Armarda 2Q 2007 results on 13th Aug 2007

At first glance

At first glance, profit was up a whopping 168%! I was thus fortunate to go in at the time its when its profit was at its trough. With the expected positive contribution from Brilliant Time Limited (BTL) and FESCO group Joint Venture, profit was surge 168% for 2nd quarter YOY from HKD 3m from 1.12m.

On closer look

There was no breakdown of the profit contribution from the associates in the financial statement. Both was stated to contribute about HKD 1.8m together. Except for 4Q 2006, BTL contribution per quarter fluctuated around HKD 1.1. It did badly in 4Q 2006, giving only 0.285m. Thus, if 4Q 2006 is an exception, the FESCO group will give a very disappointing and meagre 0.7m to this quarter. However, if BTL is unable to keep up with the good performance it had shown earlier, and hence FESCO group joint venture actually contributed majority of the 1.8m, then Armarda's future is bright indeed.

Going forward

All depend on 3 things:
1) Contributions from the associates, especially FESCO group

2) Ability to secure more Oracle financial services contracts

3) Potential usage of resouces generated from the placement of shares to Firich Enterprises Co. Ltd, hopefully resulting in formation of new joint ventures.