FY2008 Message to Shareholders
Dear Shareholders
On behalf of the Board and Management, I am delighted to report that 2008 was another successful year for Yaan. The Company achieved record revenue, operating income and earning per share in FY2008,and also achieved highest cash flow from operations in the Company’s history. Our clear growth strategies, focused execution and new products have all played a part in helping the Company to achieve record revenue, operating income, earning per share and operating cash flow in FY2008.
For the year ended 31 December 2008, Revenue increased by 42% to RMB 182.4million, and our profit before tax increased by 7% to RMB 19.4million. Earning per share was RMB Cents 29.34,an increase of 7% from FY2007. Net asset value per ordinary share was RMB1.37, an increase of 27% from FY2007. The strong demand in the security and surveillance market coupled with the introduction of our new proprietary products contributed to the increase in sales. However the profit before tax did not increase in tandem with the growth in revenue. This was mainly due to the
reduction in selling price for some of our products to ensure their competitiveness in the market, the increase in research and development expense and the increase in other operating expense. We have been more conservative in evaluating the potential risk for doubtful debts current economic financial environment.
We had a good first half year in FY 2008, revenue increased by 73% and operating profit after tax increased by 160% compared to the same period of last year. However in the second half year, our growth in revenue declined and inspite of the revenue increased by 26%, the operating profit after tax decreased by 19% compared to the same period of last year. We have taken a more cautions outlook for our business due to expected weak economic conditions through 2009.