China Innovationpay : 2016 First Quarterly Report

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Stock Code: 8083

First Quarterly Report

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 report, 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 report.

This report, for which the directors (the "Directors") of China Innovationpay Group Limited (the "Company") collectively and individually accept full responsibility, includes particulars given in compliance with the GEM Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this report 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 report misleading.

China Innovationpay Group Limited

中國創新支付集團有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 8083)

HIGHLIGHTS

The Group recorded a revenue of approximately HK$8,287,000 for the three months period ended 31 March 2016. Of this revenue, (i) approximately HK$312,000 from general trading, representing approximately 4% of the total revenue of the Group; (ii) approximately HK$5,534,000 from the prepaid card and related operations, representing approximately 67% of the total revenue of the Group; and (iii) approximately HK$1,347,000 from travellers related services, representing approximately 16% of the total revenue of the Group; and (iv) approximately HK$1,094,000 from Onecomm, representing approximately 13% of the total revenue of the Group.

The Group's turnover for the three months ended 31 March 2016 decreased 55%. In order to further expand our market share, the Group hired more business development personnel and related supporting staff. This led to an increase in general and administrative expense by approximately HK$9,825,000 million to approximately HK$24,428,000 million when compared with the same period in 2015. The Group recorded an unaudited loss after taxation of approximately HK$24,463,000.

China Innovationpay Group Limited 01 First Quarterly Report 2016

FINANCIAL RESULTS

The board of directors (the "Board") of China Innovationpay Group Limited (the "Company") announces the unaudited condensed consolidated results of the Company and its subsidiaries (the "Group") for the three months ended 31 March 2016 together with the comparative unaudited figures for the corresponding periods in 2015 as follows:

Condensed Consolidated Statement of Comprehensive Income

For the three months ended 31 March

2016 (Unaudited)	2015 (Unaudited)
Notes	HK$'000	HK$'000
Turnover	2	8,287	18,319
Cost of sales	(3,556)	(9,514)
Gross profit	4,731	8,805
Other revenue	3	2,686	656
Selling and marketing expenses	(6,516)	(6,635)
General & administrative expenses	(24,428)	(14,603)
Loss from operations	(23,527)	(11,777)
Finance cost	(936)	(1)
Loss before taxation	(24,463)	(11,778)
Taxation	4	-	(81)
Loss for the period	(24,463)	(11,859)
Other comprehensive income/(loss) for
the period, exchange difference on
translation of foreign operations	-	-

Total comprehensive income/(loss) for the

period, net of tax (24,463) (11,859)

02 China Innovationpay Group Limited

First Quarterly Report 2016