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Vtion Wireless Technology AG Back on Track: Revenues improve 54% over Q1 2011

2011 Q2 Results

  • Q2 revenues of EUR 19.4 million, H1 revenues of EUR 32 million;
  • First tablet PC sales realized in June 2011;
  • Share buyback in progress;
  • Guidance for 2011 confirmed

 

Frankfurt, 11 August 2011

Vtion Wireless Technology AG, one of the leading suppliers of wireless data solutions for mobile computing in China, has seen stronger results in the second quarter 2011 as compared to the first quarter. Vtion realized revenues of EUR 19.4 million for Q2, compared to EUR 12.6 million in Q1 - an increase by 54%. Q2 EBIT reached EUR 1.9 million, after EUR 1.03 million in Q1.

For the first six months of the year, the company reached an EBIT of EUR 2.9 million, representing an EBIT margin of 9%. Due to reduced working capital net cash from operations was significantly higher than EBIT and reached EUR 9.3 million in the first six months of 2011. In H1 2010 revenues amounted to EUR 55.8 million, EBIT to EUR 16.5 million and net cash from operations to EUR 18.2 million.

First half results are almost entirely attributable to the company's traditional core business in the wireless data terminal space (wireless data cards and routers). Vtion saw improvement in that sector in Q2 as compared to Q1, which it expects to continue. The company is currently in the process of expanding its product and application offerings, business areas that Vtion expects to contribute to H2 revenues and continue growing next year and beyond.

The company's management remains confident in reaching its previously stated guidance of revenues between EUR 75 - 100 million and an EBIT margin of 10% - 12%.

"We are pleased to see an uptick in our core wireless data terminals business over the course of the second quarter. This is due to the fact that China Telecom and China Unicom largely completed their CDMA 2000 EVDO Rev. B and HSPA+ upgrades respectively over the course of the quarter, which entailed increased demand for wireless data cards and routers, as well as support for our selling prices, given that we were dealing with newer technologies. We are also pleased to see good initial sales of our V7 tablet PC, and will look to develop that segment of our business further over the course of the year. We see strong opportunity in the tablet PC market, and will continue to diversify our hardware and application offerings as the year progresses," comments Guoping Chen, CEO of Vtion Wireless Technology AG.

 

Share buyback in progress

In April, Vtion commenced a share buy-back program for up to EUR 4 million or approximately 1 million shares. As of August 5, 2011 the company has bought back a total of 370,900 shares, at an average price of EUR 4.05. Its strong cash position allows Vtion to return funds to the shareholders via a dividend as well as the share buy-back, invest in new product and application offerings for short-term development, and increase its long-term competitiveness through investment in R&D.

 

New products to be introduced throughout 2011

In June, Vtion successfully began initial sales of its V7 tablet PC, which features a 7-inch display screen and operates on the Android 2.2 operating system. Vtion expects to increase sales of its tablet PC products over the remainder of the year. Vtion Anzhuo's mobile application platform is also fully online, and the company will begin selling applications through its own store, as well as in cooperation with China's major telecom operators and device manufacturers, with the first significant revenues expected to come in 2012. "Vtion has traditionally had a hardware-centric product portfolio, and we will continue to offer an array of hardware products in the wireless data terminal and wireless intelligent terminal sectors, and continue to leverage our strong connections to China's telecom operators as our sales channels. The increasing diversity in our hardware offerings, as well as our expansion into the mobile apps sector is a reflection of our efforts to adapt to and take advantage of a dynamically changing market," states Guoping Chen.

 

About Vtion

The Vtion Group is one of the three leading suppliers of wireless data cards and associated services for the mobile use of computers via broadband wireless networks in the People's Republic of China. The company also offers e-reader, 3G router and embedded module products through network operator and retail distribution channels, as well as several online services. For 2010, the company reached sales revenues of EUR 102 million. Vtion Wireless Technology AG shares are being traded in the Prime Standard on the Frankfurt Stock Exchange with the ISIN DE000CHEN993. The company's ticker symbol is V33.

 

For further information, please contact:

Kirchhoff Consult AG
Dr Kay Baden, tel.: +49 40 60 91 86 0, baden@kirchhoff.de
Janina Schumann, tel.: +49 40 60 91 86 50, janina.schumann@kirchhoff.de

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