Global Lock Safety (Intl) Grp CoLtd Update - new business line - major new contract (2985S)
29 November 2012 - 7:20PM
UK Regulatory
TIDMGLOK
RNS Number : 2985S
Global Lock Safety (Intl) Grp CoLtd
29 November 2012
Global Lock Safety (International) Group Co., Limited
("Global Lock" or the "Company")
Update - new business line - major new contract
Global Lock, the provider of security solutions to retail stores
and other organisations in China, is pleased to announce that its
operating subsidiary, Shenzhen Global Lock Security System
Engineering Co., Limited ("Shenzhen Global Lock"), has signed its
first system integration project. Under this contract Global Lock
will provide a comprehensive security system based on its
intelligent IT technology, utilising internet and mobile
technology, to be incorporated as part of a new development of
public and private areas at the Xiangtan Jiuhua Economic
Development Zone in Hunan province, China. The Xiangtan Jiuhua
Economic Development Zone area covers approximately 30 km2 and
includes residential areas, office buildings, construction plants
and factories.
Unlike Global Lock's traditional model of one contract per
customer, the system integration contract covers the entire
development and, as such, the customer acquisition costs are
reduced.
The main parties to this agreement contract are Chengdu Shuguang
Optical Fibre Network Co., Ltd, a domestic Chinese company with
experience electronic engineering projects, and the state run Hunan
Xiangtan Economic Development Management Committee (the
"Developer"). Shenzhen Global Lock is acting as sub-contractor to
Chengdu Shuguang Optical Fibre Network Co., Ltd. The project is
scheduled to be completed by 28 February 2013.
The Directors anticipate that the contract will make a positive
revenue contribution to its accounts for the period ending 31
December 2013 as 50% of the contract fee will be paid into an
escrow account controlled by Chengdu Shuguang Optical Fibre Network
Co., Ltd and the Developer and this will be released at the
completion of the project. An additional 30% of the contract fee
will be paid one year after acceptance of the completion of testing
phase of the project by the Developer (expected to be in 28
February, 2013) with the remaining 20% of the contract fee to be
paid two years after final acceptance and completion of the project
by the Developer.
Under the terms of the sub-contracting arrangement, Shenzhen
Global Lock will pay Chengdu Shuguang Optical Fibre Network Co.,
Ltd a 3% management fee on all sums received by Shenzhen Global
Lock from the Developer. All of Shenzhen Global Lock's expenses
will be recharged to the Developer.
Under the terms of the contract, Shenzhen Global Lock is
required to pay a RMB2.0 million performance deposit (approximately
GBP 200,000) (the "Deposit"), via Chengdu Shuguang Optical Fibre
Network Co., Ltd, to the Developer which is fully refundable upon
successful completion of the project. The Deposit was loaned to
Shenzhen Global Lock by its Chairman, Li Mo Xiang, in August 2012
and is covered by the terms of the loan facility from Mr Li,
further details of which were announced on 24 September 2012.
Following the successful signing of the Xiangtan Jiuhua Economic
Development Zone smart system integration contract, Shenzhen Global
Lock is currently working on other similar projects and further
announcements will be made at the appropriate time.
Li Mo Xiang, Chairman of Global Lock, commented: "I am extremely
pleased to be able to announce our first security system
integration contract. We feel that contracts which cover a number
of customers simultaneously represent an extremely efficient use of
our resources and also lowers our customer acquisition costs. These
type of contracts have the potential to make a positive
contribution to our revenue in future years and also help to
diversify our business. I look forward to being able to make
further positive contract win announcements in the future".
Enquiries:
Global Lock Safety (International) Group
Li Mo Xiang, Chairman Tel: +86 755 8366 0755
Robert Zhang, Director and Tel. +86 755 8655 6705 (IDD)
Chief Investor Relations Officer E-mail:
robertzh@globallock.com
Andrew Gee, Non-executive Director Tel: + 44 777 565 3564
Allenby Capital Limited Tel: + 44 20 3328 5656
Nick Naylor
Alex Price
This information is provided by RNS
The company news service from the London Stock Exchange
END
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