Pax Global Technology : Sales Announcement

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PAX Global Technology Limited

百富環球科技有限公 司 *

(Incorporated in Bermuda with limited liability)

(Stock Code: 327) SALES ANNOUNCEMENT

This announcement is made by PAX Global Technology Limited (the "Company", together with its subsidiaries, the "Group") to provide the investors and shareholders of the Company with operational update on the Group's business. The unaudited consolidated revenue of the Group for the nine months ended 30 September 2016 (the "Period") is set out as follows.

TURNOVER FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2016

The unaudited consolidated revenue of the Group increased by approximately 4.3% or HK$87.2 million to approximately HK$2,117.7 million for the Period when compared to HK$2,030.5 million for the corresponding period in 2015.

Major operational data (unaudited) of the Group by geographical region for the Period is set out as follows:

Turnover For the nine months ended 30 September

+/(-)

(Local

2016 (HK$ million)	2015 (HK$ million)	+/(-) (HK$ Basis)	Currency Basis)
Overseas markets	1,189.4	1,028.3	+15.7%	+15.7%
China Market	928.3	1,002.2	-7.4%	-3.0%
Total turnover	2,117.7	2,030.5	+4.3%	N/A

* For identification purpose only

1. Overseas markets

   Turnover generated from overseas markets increased by approximately 15.7% or HK$161.1 million to approximately HK$1,189.4 million for the Period, from HK$1,028.3 million for the corresponding period in 2015. In the United States of America and Canada Region ("USCA"), benefitting from the Company's diversified product line (including multimedia payment terminals and mobile E-payment terminals (the "mPOS")), the region has recorded impressive sales growth despite the slowing down of the Europay, MasterCard and Visa (EMV) migration. In the Asia Pacific Region (except for Mainland China) ("APAC"), sales continued to grow following the Group's entrance to the India and Indonesia markets with the mPOS, bringing positive impact to the results of APAC. The management expects to attain a considerable and sustainable market share in Europe in the coming years. Overseas markets turnover contributed to approximately 56% of the total turnover of the Group for the Period, as compared to 51% for the corresponding period in 2015. Major operational data (unaudited) attributable to each respective overseas market for the Period is set out as follows:

   Turnover For the nine months ended 30 September 2016 2015

   (HK$ million) (HK$ million)

   +/(-)

   (HK$ Basis)

   Europe, Middle East and Africa 444.6 370.3 +20.1% Latin America and Commonwealth

   Independent States 475.6 492.7 -3.5%

   APAC 127.5 101.3 +25.9%

   USCA 141.7 64.0 +121.4%

   Total turnover in overseas markets 1,189.4 1,028.3 +15.7%

2. China Market

Turnover generated from the People's Republic of China (excluding Hong Kong, Macau and Taiwan) ("China Market") decreased by approximately 7.4% or HK$73.9 million to approximately HK$928.3 million for the Period, when compared to HK$1,002.2 million for the corresponding period in 2015. During the Period, the drop in the Group's sales in China Market was mainly due to Renminbi ("RMB") depreciation and the implementation of new debit card and credit card interchange rate payment policies in China. As the average exchange rate of RMB to Hong Kong Dollar ("HK$") depreciated by 4.7% in the Period as compared to the corresponding period in 2015, such devaluation affected the Group's consolidated revenue which was denominated in HK$. China Market turnover contributed to approximately 44% of the total turnover of the Group for the Period, as compared to 49% for the corresponding period in 2015.

The Impact of Exchange Rates:

Despite the aforesaid effect of RMB depreciation on China Market turnover, RMB depreciation would however be beneficial to the operation of the Group, especially in the overseas markets, as most of the cost of sales, selling expenses and administrative expenses (including research and development expenses) are denominated in RMB.

The Group adopts a merger and acquisition strategy to proactively seek service income in developed markets and sales channels in major overseas markets, with an aim of becoming the forerunner in the payment industry. Turnover for a particular quarter is not representative for full year performance as sales of E-payment Terminals is associated with seasonality, policy changes and the concentration of customers' order book. It should be noted that the information contained in this announcement is only based on a preliminary review of the unaudited consolidated management accounts of the Group, which have not been reviewed or audited by the Company's auditors. The above operating data does not constitute, represent or indicate the full picture of the Group's total revenue or financial performance and the information contained in this announcement may be subject to change and adjustment. The Company's shareholders and potential investors are advised to exercise caution when dealing in the shares of the Company.

By Order of the Board

PAX Global Technology Limited Li Wenjin

Executive Director

Hong Kong, 26 October 2016

As at the date of this announcement, the Board comprises three executive directors, namely Mr. Nie Guoming, Mr. Lu Jie and Mr. Li Wenjin and three independent non-executive directors, namely Mr. Yip Wai Ming, Dr. Wu Min and Mr. Man Kwok Kuen, Charles.