International Elite : Annual Report 2018 【PDF file】

CONTENTS

Corporate Information	2
Chairman's Statement	3
Management Discussion and Analysis	4
Report of Directors	14
Corporate Governance Report	35
Profile of Directors and Senior Management	45
Independent Auditor's Report	47
Consolidated Income Statement	52
Consolidated Statement of Comprehensive Income	53
Consolidated Statement of Financial Position	54
Consolidated Statement of Changes in Equity	55
Consolidated Statement of Cash Flows	56
Notes to the Consolidated Financial Statements	57
Five-Year Financial Summary	124

CORPORATE INFORMATION

EXECUTIVE DIRECTORS

Zhao John Huan (Chairman) (appointed on 28 December 2018)

Lu Yan (appointed on 28 December 2018 and resigned on 23 April 2019)

Lin Tun (Chief Executive Officer) (appointed on 28 December 2018)

Yuan Bing (appointed on 28 December 2018) Li Yin

Li Kin Shing (Chairman and Chief Executive Officer) (resigned on 28 December 2018)

Wong Kin Wa (resigned on 28 December 2018) Li Wen (resigned on 28 December 2018)

INDEPENDENT NON-EXECUTIVE DIRECTORS

Chen Xue Dao

Cheung Sai Ming

Liu Chun Bao

AUTHORIZED REPRESENTATIVES

Lin Tun (appointed on 28 December 2018)

Chan Wai Ching (appointed on 28 December 2018) Li Kin Shing (resigned on 28 December 2018) Wong Kin Wa (resigned on 28 December 2018)

COMPLIANCE OFFICER

Wong Kin Wa (resigned on 28 December 2018)

COMPANY SECRETARY

Chan Wai Ching

AUDIT COMMITTEE

Cheung Sai Ming (Chairman)

Chen Xue Dao

Liu Chun Bao

REMUNERATION COMMITTEE

Yuan Bing (Chairman)

(appointed on 28 December 2018)

Chen Xue Dao

Cheung Sai Ming

Wong Kin Wa (resigned on 28 December 2018)

NOMINATION COMMITTEE

Zhao John Huan (Chairman)

(appointed on 28 December 2018)

Chen Xue Dao Cheung Sai Ming

Li Kin Shing (resigned on 28 December 2018)

REGISTERED OFFICE

The Grand Pavilion Commercial Centre

Oleander Way, 802 West Bay Road

Grand Cayman KY1-1208

Cayman Islands

HEAD OFFICE AND PRINCIPAL PLACE OF BUSINESS IN HONG KONG

Suite 2701, One Exchange Square

Central

Hong Kong

PRINCIPAL BANKERS

Bank of China (Hong Kong) Limited

Gilman Street Branch

136 Des Voeux Road

Central, Hong Kong

Citibank N.A.

21/F Tower 1, The Gateway

Harbour City, Tsimshatsui

Kowloon, Hong Kong

PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE

Royal Bank of Canada Trust Company (Cayman) Limited 4th Floor, Royal Bank House

24 Shedden Road, George Town Grand Cayman KY1-1110 Cayman Islands

BRANCH SHARE REGISTRAR AND TRANSFER OFFICE IN HONG KONG

Tricor Investor Services Limited

Level 22, Hopewell Centre

183 Queen's Road East

Hong Kong

AUDITOR

PricewaterhouseCoopers

Certified Public Accountants

22nd Floor, Prince's Building

Central

Hong Kong

STOCK CODE

1328

2 International Elite Ltd.Annual Report 2018

CHAIRMAN'S STATEMENT

On behalf of the board of directors (the "Board") of International Elite Ltd. (the "Company"), I am pleased to present the consolidated results of the Company and its subsidiaries (collectively, the "Group") for the year ended 31 December 2018.

In 2018, the Group has broadened its customer base and successfully entered into a number of customer relationship management ("CRM") agreements with customers, including but not limited to China United Network Communications Co., Ltd. Meizhou Branch (中國聯合網路通信有限公司梅州市分公司), China United Network Communications Co., Ltd. Shenzhen Branch (中國聯合網路通信有限公司深圳市分公司) and China United Network Communications Co., Ltd. Guangxi Branch (中國聯合網路通信有限公司廣西壯族自治區分公司). With the success in the broadening of customer base and the development of various solutions, the leading position of the Group in both service and technology is affirmed and acknowledged through industry awards and certification granted.

The directors of the Company ("Director(s)") believe that the Group will continue to benefit from the opportunities arising from the favorable government policies in China including the growth in 4G mobile communications, the rapid development of 5G mobile communications technology, the "Internet Plus" strategy, the increase in domestic demand and China's 13th Five- Year Plan for the development of "Smart City". The Group is confident that in 2019, it will win more contracts from customers of both telecommunications and non-telecommunications segments in the provinces outside Guangdong, China. The Group is confident that it will achieve continuous business growth as it is well positioned to take the advantage of market expansion with its strong reputation, transparency and solid customer portfolio.

The Company disposed Global Link Communications Holdings Limited ("GLCH") by way of distribution in specie of shares of GLCH in October 2018. Sunward Telecom Limited and its subsidiaries ("Sunward Group") was disposed in November 2018 as well. The revenues from the two businesses were not as significant as initially expected and did not contribute much to the business and financial performance to the Group.

Upon the purchase of the entire issued share capital of Goldstream Capital Management Limited ("GCML") and Goldstream Securities Limited ("GSL") (collectively, the "Goldstream Companies") in November 2018, the companies become wholly owned subsidiaries of the Company. The Board has been from time to time exploring and identifying new business opportunities with an aim to broaden the Group's income stream and enhance the shareholders' value. The Goldstream Companies have licences to carry out Type 1 (dealing in securities) (subject to certain conditions), Type 4 (advising on securities) and Type 9 (asset management) regulated activities under the Securities and Futures Ordinance. The Group, through the acquisition, will have instant access to a readily available financial business platform which enables the Group to tap into the financial services sector.

The Group is an organisation that is fast growing and ever evolving. It imagines, conceptualizes, realizes and takes new challenges and new forms. Through business acquisitions, it has been constantly expanding its investment portfolios in an enterprising but prudent manners.

Throughout the development course of the Group, it is crucial to have the devotion of its staff. On behalf of the Board, I would like to thank all our staff for their passion and hard work in turning the Group's vision into reality. I also take this opportunity to extend my appreciation to our shareholders and business partners for their trust and support. The Group's management and staff will work cohesively under the leadership of the Board to overcome challenges in the coming year and generate returns for our shareholders.

ZHAO JOHN HUAN

Chairman

Hong Kong, 26 March 2019

International Elite Ltd.Annual Report 2018

3

MANAGEMENT DISCUSSION AND ANALYSIS

BUSINESS OVERVIEW

The Group is a customer relationship management ("CRM") outsourcing service provider with business focus in Hong Kong, Macau and the People's Republic of China (the "PRC") markets. CRM is a process of providing services to customers with the use of communication and computer networks. During the year under review, the Group continued to provide services to established telecommunications service providers, including Hutchison Telecommunications, HGC Global Communications, China Unicom Guangdong and PCCW Mobile. Besides, management continues to diversify the Group's CRM customer base to non-telecommunications industries, the clients of which include, but not limited to, KFC, Guangzhou Watsons, Wuhan Watsons, Hong Kong Watsons, Guangzhou Park'N Shop, Pizza Hut and China Guangfa Bank.

The Sunward Group was acquired in September 2010 and disposed in November 2018, during the period, the Group was also engaged in the research and development, production and sales of radio-frequency subscriber identity module ("RF-SIM") products and licensing of the RF-SIM operation rights in markets other than Hong Kong and Macau as well as the research and development and technology transfer of certificate authority-SIM("CA-SIM") application right to customers.

GLCH was acquired in April 2016 and the Company disposed GLCH by way of distribution in specie of shares of GLCH in October 2018, as a result, the Group was also engaged in the provision of passenger information management system ("PIMS") during the period.

Upon the purchase of the entire issued share capital of GCML and GSL in November 2018, the Group is also engaged in investment management ("IM") business.

The principal business of the Group is classified into the following four segments:

CRM Service ("CRMS") Business

CRMS business includes the provision of inbound services and outbound services. Inbound services comprise a range of customer hotline services, including general enquiry, technical support, broadband connection arrangement, service installation, account activation, subscriber details update, account enquiry, account termination, order placement, member registration, built-in secretary ("BIS") and super secretarial services ("Super BIS"). BIS service is a personalized message taking service, where its operators transmit messages left to the subscriber via SMS. The Super BIS service is a concierge service where the operators can provide advanced functions such as making restaurant reservation and purchasing flight tickets for high- end subscribers. Outbound services, on the other hand, include telesales services and market research services. The Group's operators run on behalf of their customers promotions and ongoing telemarketing via unsolicited phone calls (cold calls). The operators can also conduct large scale surveys to efficiently collect feedback, opinions, and in some cases, complaints for their customers.

RF-SIM Business

RF-SIM is a technology of proprietary intellectual property right that embeds a special-made radio frequency module into a mobile SIM card that complies with GSM specifications. The RF-SIM card is a combination of ordinary mobile phone subscriber identity module card and contactless smartcard. RF-SIM business covers (i) the research and development, production and sales of RF-SIM products; (ii) licensing of the RF-SIM operation rights in markets other than Hong Kong and Macau; and (iii) research and development and technology transfer of CA-SIM application rights to customers.

PIMS Business

PIMS business includes supply, development and integration of passenger information management system.

IM Business

IM business includes (i) the provision of advisory services on securities and asset management; and (ii) securities trading.

4 International Elite Ltd.Annual Report 2018