Cash and bank balances were approximately HK$489 million (2008: HK$124 million) and the Company had HK$1.8 million bank borrowings as at 31 December 2009. The Board did not recommend a payment of any interim dividend for the nine months ended 31 December 2009 (2008: Nil).

The new core business, MIDS is already contributing to the Company’s revenue. Mr. Bonny Au, Executive Director of Xing Lin, said, “MIDS, which the Company acquired in October 2009, is expected to have rolled out to ten hospitals by the first quarter of 2010. Since the PRC government is determined to mandate the digitalization of hospitals and medical system to minimize medical errors and improve medical efficiency and accuracy, the space for information technology systems in the healthcare sector is expected to be expanded in a very significant manner. Under this backdrop, the Company will continue with its strategy to focus on the medical IT area in the PRC.”

Eyeing on accelerating the development of MIDS as well as expanding its product line, the Company entered into a sale and purchase agreement on 21 January 2010, pursuant to which and upon completion it will acquire 20% of the total registered capital of Redart Digital Technology Co., Ltd. (“Redart”).

Redart has entered into a co-operation agreement which sets out the framework for the digitalization programme of the medical and healthcare system in Chengde city in the PRC. The programme will cover, amongst others, the establishing of network for medical and healthcare data transmission amongst the villages, counties and the cities area so as to enable distant medical consultation; upgrading of the network of each hospital; establishing of data centres for storage of electronic medical records; and introducing “medical card” to individuals. Personal medical history will be stored in such medical card and therefore people will be able to attend any hospital for medical consultation.

Redart has also entered into a five-year MOU with Tianjin Microsoft Technology Centre (“Tianjin Microsoft”) and agreed to provide financial support for the large scale marketing and operation platform of the healthcare digitalized products of Tianjin Microsoft which is a total solution provider for the hospital and medical digitalisation services, public healthcare and hygiene digitalisation services and online medical and consultation services. Under the MOU, Tianjin Microsoft has agreed to procure not less than five cities in the PRC for co-operation during the term of the MOU and not less than two cities for co-operation in 2010.

Mr. Au commented, “the acquisition of Redart offers prospects for the Company to market and provide MIDS to more than 200 hospitals/clinics in Chengde, Hebei Province, PRC, therefore enabling the Company in further extending its business in healthcare information system and Wi-Fi/RFID based identification application system and related computerized data-backup solutions to the healthcare sector in the PRC. Furthermore, the acquisition presents an opportunity for us to accelerate the pilot of MIDS phase 2 – healthcare collaboration platform in Chengde.”

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