Pursuant to Listing Rule 1313(2), the Company wishes to provide an update on the Company and the Group for the quarter ended 30 September 2011 ("3Q FY2011").

1. Update on unaudited Financial Performance and Position
   1. Comparison of 3rd Quarter of 2011 ("3Q 2011") against 3rd Quarter of 2010 ("3Q 2010)
      

      Group revenue grew by 30.0% from S$4.7 million in 3Q 2010 to S$6.1 million in 3Q 2011. A write-back of provision for inventory obsolescence of S$0.1 million and S$0.5 million were included in 3Q 2011 and 3Q 2010 respectively. Excluding the write-back of provision for inventory obsolescence, the gross margin improved to 25.2% for 3Q 3011 as compared to 24.7% for 3Q 2010.

      Other income in 3Q 2011 included a write-back of provision for doubtful debts of $0.3 million and foreign exchange gain of S$0.2 million. Other income in 3Q 2010 included a write-back of provision for doubtful debts of S$0.6 million and foreign exchange gain of S$44,000.

      Total operating expenses, comprising distribution, administration and other expenses, decreased by S$0.2 million, mainly due to the improved operating efficiency and reductions in headcount, office rentals and professional fees.

   2. Comparison of 9 months ending 30 September 2011 ("YTD 2011") against 9 months ending 30 September 2010 ("YTD 2010)
      

      Comparing YTD 2011 against YTD 2010, revenue increased by 19.9% from $14.1 million to S$16.9 million with gross profit increasing by 33.6%, from S$4.0 million to S$5.3 million. Write-back of provision for inventory obsolescence for YTD 2011 was S$0.2 million, while for YTD 2010 it was S$0.8 million. Excluding the writeback of provision for inventory obsolescence, gross profit margin improved from 22.7% in YTD 2010 to 29.9% in YTD 2011, as in YTD 2011 the Group had undertaken more projects with proportionately higher services revenue content, which tend to yield higher gross profit margins than hardware revenue content.

      Write-back of provision for doubtful debts of $0.6 million and S$0.7 million were included in other income in YTD 2011 and YTD 2010 respectively.

      Total expenses – comprising distribution, administration and other expenses – decreased by 19.7% or S$1.4 million, due to the Group’s continuous efforts to manage and rationalize its operating cost.

      The Group recorded a profit of S$365,000 for the 9 months ended 30 September 2011 as compared to a loss of S$2.3m for the corresponding period in FY2010

2. Material Development and Future Direction

   Some disruption to the Group’s operations in Thailand may be expected in November and December 2011 due to the floods in Bangkok. However, we do not foresee that this will have a major adverse impact on the Group’s full-year result for FY2011.

   The Group’s subsidiary company in South Korea, incorporated in June 2011, is set to commence operations in the last quarter of FY2011. The set up of a new subsidiary in Malaysia is also in progress and it is foreseen that its operations will commence in FY2012. In addition, steps are being taken to revive the Group’s Shanghai operations, which have been inactive since FY2010.

   Given the current uncertainties in the global economic situation, business conditions remain challenging and competitive. The Group remains cautiously optimistic on the prospects of its business for the remainder of FY2011 and has recently announced its proposal for a 1 for 2 renounceable rights issue to raise working capital.