Sinotel Technologies responds to SGX queries on financial statements

The discrepancies in the company’s decrease in revenue and trade receivables got SGX concerned.

In a release, the Board of Directors of Sinotel Technologies Ltd. provided additional information in relation to its Financial Statements and Dividend Announcement for the nine months period ended 30 September 2011 which was released on 4 November 2011.

The information is provided in response to SGX’s queries as follows:

The decrease in revenue was mainly arising from a decrease in revenue from Heibei Province and Shanxi Province as well as a decrease in sales of equipment as the Group’s business strategy was to focus on other segment, i.e. service related projects, which generated higher profit margin.

The average trade receivables turnover was 379 days as at 30 September 2011 (31 December 2010: 266 days).

The increase in average trade receivables turnover was mainly due to the delay in payment from customers, mainly because of the internal restructuring and the change of personnel within the telcos (“PRC telecommunication carriers”). However, the customers have good track record and have no history of default.