Telecom Service One : Final Results Announcement for the year ended 31 March 2016

44339-01A 1..20

Telecom Service One Holdings Limited

電 訊 首 科 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 8145)

FINAL RESULTS ANNOUNCEMENT

FOR THE YEAR ENDED 31 MARCH 2016

CHARACTERISTICS OF THE GROWTH ENTERPRISE MARKET (''GEM'') OF THE STOCK EXCHANGE OF HONG KONG LIMITED (THE ''STOCK EXCHANGE'')

GEM has been positioned as a market designed to accommodate companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors.

Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board of the Stock Exchange and no assurance is given that there will be a liquid market in the securities traded on GEM.

Hong Kong Exchanges and Clearing Limited and the Stock Exchange take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

This announcement, for which the directors of Telecom Service One Holdings Limited (the ''Company'') collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on GEM of the Stock Exchange (the ''GEM Listing Rules'') for the purpose of giving information with regard to the Company. The directors of the Company (the ''Directors''), having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this announcement is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this announcement misleading.

FINAL RESULTS

The board of Directors (the ''Board'') of the Company announces the audited consolidated results of the Company and its subsidiaries (collectively referred to as the ''Group'') for the year ended 31 March 2016, together with the comparative figures for the year ended 31 March 2015:

Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the year ended 31 March 2016

Notes	2016 HK$'000	2015 HK$'000
Revenue	3	122,494	126,415
Cost of sales	(68,102)	(67,265)
Gross profit	54,392	59,150
Other income	5	2,747	2,308
Other operating expenses, net	6	(14,655)	(15,250)
Administrative expenses	(15,281)	(16,315)
Finance costs	7	(285)	(170)
Profit before tax	26,918	29,723
Income tax expense	8	(4,537)	(5,243)
Profit for the year	9	22,381	24,480
Other comprehensive (expense) income
Items that will not be reclassified to profit or loss:
Remeasurement of long service payment obligations	32	28
Items that may be reclassified subsequently to profit or loss:
Exchange differences arising on translation of foreign operations	(40)	-
Other comprehensive (expense) income for the year	(8)	28
Total comprehensive income for the year	22,373	24,508
Earnings per share (HK$)	11
Basic	0.186	0.204
Diluted	0.183	0.203

Consolidated Statement of Financial Position At 31 March 2016
2016	2015
Notes	HK$'000	HK$'000
Non-current assets
Plant and equipment	3,827	4,424
Deferred tax asset	514	437
4,341	4,861
Current assets
Inventories	6,381	4,295
Trade and other receivables	12	21,539	28,179
Amounts due from related companies	1,206	1,154
Tax recoverable	804	-
Pledged bank deposits	29,972	30,220
Bank balances and cash	16,908	14,265
76,810	78,113
Current liabilities
Trade and other payables	13	6,151	9,967
Amounts due to related companies	2,273	79
Tax payables	-	1,703
Bank overdrafts	-	349
Bank borrowings	18,600	15,736
27,024	27,834
Net current assets	49,786	50,279
Total assets less current liabilities	54,127	55,140
Non-current liability
Long service payment obligations	-	-
Net assets	54,127	55,140
Capital and reserves
Share capital	14	12,001	12,000
Reserves	42,126	43,140
Total equity	54,127	55,140

Notes to the Consolidated Financial Statements

For the year ended 31 March 2016

1. GENERAL

   Telecom Service One Holdings Limited (the ''Company'') is a company incorporated in the Cayman Islands as an exempted company with limited liability under Companies Law, Chapter 22 (Law 3 of 1961, as consolidated and revised) of the Cayman Islands on 3 August 2012 and its shares are listed on the Growth Enterprise Market (the ''GEM'') of The Stock Exchange of Hong Kong Limited (the ''Stock Exchange'') on 30 May 2013. The address of the registered office of the Company is Clifton House, 75 Fort Street, P.O. Box 1350, Grand Cayman KY1-1108, the Cayman Islands and the principal place of business of the Company is Units 1805-1807, 18/F., Riley House, 88 Lei Muk Road, Kwai Chung, New Territories, Hong Kong.

   The directors of the Company consider the immediate holding company is East-Asia Pacific Limited (''East-Asia''), a company incorporated in the British Virgin Islands (''BVI'') and the ultimate parent is Cheung Family Trust.

   The Company is principally engaged in investment holding. The principal activities of its subsidiaries are provision of mobile phones and consumer electronic devices repair service and sales of consumer electronic devices related products.

   The functional currency of the Company is Hong Kong dollars (''HK$'') while the functional currencies for certain subsidiaries are Renminbi (''RMB''), New Taiwan dollars (''NT$'') and Macau Patacas (''MOP''). For the purpose of presenting the consolidated financial statements, the Company and its subsidiaries (hereinafter collectively referred to as the ''Group'') adopted HK$ as its presentation currency which is the same as the functional currency of the Company.

2. BASIC OF PREPARATION

   The consolidated financial statements have been prepared on the historical cost basis at the end of each reporting period, as explained in the accounting policies set out below.

   Historical cost is generally based on fair value of the consideration given in exchange for goods and services.

   Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Group takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial statements is determined on such a basis, except for share-based payment transactions that are within the scope of HKFRS 2, leasing transactions that are within the scope of HKAS 17, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in HKAS 2 or value in use in HKAS 36.

   In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:

   • Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;