About DIRECTEL Company

The Group is a mobile virtual network operator with MVNO and ETS licenses in Hong Kong, China. The Group has been mainly engaged in providing outstanding “one-card multi-number” services in Hong Kong, China under the “China-HK Telecom/China Hong Kong Stock Connect” and “Directel/Direct Connect” brands. The service allows its users to simultaneously have mobile phone numbers in different designated regions (especially mainland China and Hong Kong, China) with a single SIM card, so that they can easily make and receive long-distance calls from Hong Kong, China and other designated regions at a lower cost than roaming services. The Group also provides users with international long-distance telephone services from Hong Kong, China to all parts of the world and local mobile services in Hong Kong, China. The Group has prepaid and postpaid plans for mobile phone services. In addition, the Group provides telemarketing agency services to a number of major mobile network operators in Hong Kong, China to maintain the Group's strategic relationships with its major customers (one of which is the Group's airtime service provider). The Group adopts a low-cost strategy for its business and operations. One characteristic of the Group's low-cost business model is that, with the exception of a relatively small amount of core equipment related to the provision of “one card multiple number” services, the Group provides mobile communication services through mobile networks of third parties that it does not own or operate. Instead, the Group purchases airtime from major mobile network operators in Hong Kong, China at the agreed rate, purchased mainland China airtime from major mobile network operators in mainland China, and resold the purchased airtime to its users or distributors or to its corporate customers under its own brand name. This model saved the Group's own investment in the time and huge amount of money required to build a complete mobile communication network infrastructure. Furthermore, the Group is not required to maintain a team composed entirely of technical staff to continuously repair and maintain such network infrastructure. In addition, the Group also minimizes the size of its company and reduces general expenses by outsourcing many non-core business operations or administrative functions such as data processing and billing management services and call center services to third parties. Through these initiatives, the Group has been able to focus its efforts on investing in its “one card multi-number” service and developing and maintaining its business relationships with mobile network operators in various regions such as mainland China, Hong Kong, and Taiwan, and developing new products or services for its customers. Despite fierce competition in the mobile communications market and the global financial crisis, the Group's low-cost strategy helped it maintain profits during the record period. The sales and distribution channels for the Group's mobile communication services are mainly wholesale to dealers and mobile network operators and retail to end users. Most of the call time of the Group's mobile communication services is distributed to dealers by prepaid SIM cards and recharge vouchers. The sales network of these dealers covers a wide range of stores and stores in Hong Kong, China, including convenience store chains, mobile phone stores and other convenient places for users to buy. In addition to purchasing Hong Kong airtime from major mobile network operators in Hong Kong, China, the Group has also been selling mainland China airtime from a mobile network operator in mainland China. Similarly, in addition to purchasing mainland China airtime from mainland China mobile network operators, the Group has also been selling Hong Kong, China airtime from a major mobile network operator in Hong Kong, China. Since the Group has its own system infrastructure to support the “One Card Multiple Number” service, the Group has successfully sold a large amount of mainland China airtime and Hong Kong airtime to major mobile network operators in Hong Kong, China and a mobile network operator in mainland China, respectively. Additionally, a portion of the Group's airtime is directly retailed to its end users through its service plans. In order to further expand its market share and enhance profitability, the Group will cover its “One Card Multiple Number” service to Taiwan, China, and plans to expand this service to other regions in the Asia-Pacific region after the Taiwan business matures. The Group also plans to develop 3G mobile data services by upgrading its existing system infrastructure to increase the variety of services provided to its users. Furthermore, the Group plans to introduce RF-SIM (a mobile phone SIM card and a contactless smart card) to provide its users with more value-added services, such as entering and leaving parking lots and housing estates, and receiving promotional materials or promotional coupons through mobile phones. Continuing the past and creating another brilliance, the Group continuously improves customer service standards and stabilizes market profits in the field of traditional communications. Looking forward to the future, the Group will enter the mobile internet market through various apps such as new roaming, softphones, and encrypted contacts. By developing integrated communications, we will continue to forge ahead courageously towards the goal of developing a new type of mobile Internet.