Final Results

30 June 2011

MEDILINK-GLOBAL UK LIMITED

FINAL RESULTS

Medilink-Global UK Limited (AIM: MEDI), the electronic health card network service provider, is pleased to announce its final results for the year ended 31 December 2010.

FINANCIAL HIGHLIGHTS

·; Revenue increased by 44% to £1.79 million (Revenue for the 12 months ended 31 December 2009: £1.24 million).

·; Loss before tax reduced by 26% to £696,000 (Loss before tax for the 12 months ended 31 December 2009: £942,000).

OPERATIONAL HIGHLIGHTS

·; Renewal of Third Party Administrator ("TPA") contracts and new TPA contracts secured in China, including:

(i) 1 February 2010 - Three year contract with Global Benefits Group;

(ii) 12 February 2010 - Two year contract with America International Assurance Company (Bermuda) Limited;

(iii) 1 June 2010 - Rolling 12 month contract with CIGNA and CMC Life Insurance Company Ltd.;

(iv) 1 July 2010 - Rolling 12 months contract with HSBC Life Insurance Company Ltd;

(v) 20 October 2010 - Three year contract with Taikang Life Insurance Company Ltd;

(vi) 14 February 2011 - Three year contract with Ping An Health Insurance Company Ltd;

(vii) In April 2011 - Rolling 12 months contract with Canadian International School of Beijing;

(viii)9 March 2010 - the contract with Winterthur Insurance (Asia) Company Ltd. was renewed for one year; and

(ix) 12 October 2010 - the contract with LAMP was renewed for one year.

·; On 1 January 2011, the Company renewed the contract with ING Employee Benefits Sdn Bhd ("INGEB") for a further five year period up to 31 December 2015. Estimated value of the renewal is RM5 million (approximately £1 million).

·; The Company launched a new service offering Medical Tourism programs in Malaysia.

POSTING OF ANNUAL REPORT AND NOTICE OF AGM

A copy of the annual report and accounts and notice of the Company's annual general meeting, to be held at No. 9, Persiaran Industri, Bandar Sri Damansara, 52200 Kuala Lumpur, Malaysia, on 25 July 2011 at 10.00 am (Malaysia time) has been posted to shareholders today and will be available shortly from the Company's website, www.medilink-global.com.

Enquiries:

CHAIRMAN'S STATEMENT

Medilink-Global UK Limited ("Medilink" or "MGL UK" or "the Company") is pleased to present the consolidated results of the Company and its subsidiaries ("the Group") for the year ended 31 December 2010.

OVERVIEW

The 2010 financial year saw Medilink gain increased traction in China whilst the business activities in Malaysia continued to expand. Medilink won six additional TPA contracts in China and launched a new service in Malaysia, offering Medical Tourism programs to foreigners travelling in the country.

FINANCIAL REVIEW

The Group recorded revenues of £1.79 million (2009: £1.24 million) and a loss after taxation of £0.69 million (2009: loss after taxation £0.92 million) for the year ended 31 December 2010. This out-turn is in line with market expectations. Revenues increased by 44% compared to the previous year as the result of the overall increase in activities across South East Asia and China operations. Stronger market uptake in China led to a 170% increase in revenues from the region compared to the previous year, whilst revenues from Singapore and Malaysia increased by 20% and 1% respectively. The increase in revenues was offset by a corresponding increase in operating costs for the China and Malaysia operations, in tandem with the pace of expansion in those regions. As a result, the loss after taxation of £0.69 million for the year under review has only improved marginally compared to previous year's loss after taxation of £0.92 million.

GROUP'S OPERATIONS REVIEW

China

Revenues from our operations in China increased by 170% in 2010 compared to 2009. This was driven mainly by strong organic growth in the TPA contracts signed in previous years, with just two of the contracts signed in 2010 contributing to revenues. As a result of this significant uptake, the operating costs in China were higher than initially planned as we had to step up the expansion programme. This led to our China operations recording a loss for the year.

The average monthly revenue per employee during the year for China operations of £627 has improved compared to the previous year of £312. We expect the monthly average revenue per employee for China to continue to improve as the business matures.

Looking forward, we were pleased with the number of new insurance companies that were signed up during the year. It usually takes several months before we generate significant revenues from a new TPA contract and the 2010 signings will therefore provide the basis for the growth anticipated in 2011, alongside the continuing growth expected from the older TPA contracts.

During 2010 and 2011 to date, Medilink has won seven new TPA contracts in China and had two TPA contracts renewed as follows: -

(i) 1 February 2010 - Three year contract with Global Benefits Group;

(ii) 12 February 2010 - Two year contract with America International Assurance Company (Bermuda) Limited;

(iii) 9 March 2010 - the contract with Winterthur Insurance (Asia) Company Ltd. was renewed for one year;

(iv) 1 June 2010 - Rolling 12 month contract with CIGNA and CMC Life Insurance Company Ltd.;

(v) 1 July 2010 - Rolling 12 months contract with HSBC Life Insurance Company Ltd;

(vi) 12 October 2010 - the contract with LAMP was renewed for one year;

(vii) 20 October 2010 - Three year contract with Taikang Life Insurance Company Ltd;

(viii) 14 February 2011 - Three year contract with Ping An Health Insurance Company Ltd; and

(ix) In April 2011 - Rolling 12 months contract with Canadian International School of Beijing.

To date the number of healthcare providers operating in our network in China has reached 288 (2009: 226).

The Chinese healthcare insurance market offers a huge opportunity for growth and is expected to more than double over the next 5 years. Medilink now has a strong presence in China. Our clients represent 30% of the Chinese insurance market and we have a widespread network of healthcare providers in strategic locations. With a very credible operation in place, our wealth of experience and leading technology we believe Medilink is well positioned to exploit this market.

Malaysia

The prevailing service agreement between Medilink and the Malaysian insurance company, ING Employee Benefits Sdn Bhd ("INGEB"), which expired on 31 December 2010, was renewed for a further five year period with effect from 1 January 2011 to 31 December 2015. INGEB is a wholly owned entity of ING Insurance Berhad, which is currently the industry leader in providing Group Health Insurance and Employee Benefits Administration in Malaysia.

The renewal of the five year contract with INGEB signifies the importance and strategic values of Medilink's Electronic Healthcard Network that forms part of the essential tools for INGEB to process its medical claims efficiently. Medilink's services shall continue to provide INGEB with the competitive edge to differentiate itself from its competitors in the industry.

During the year, Medilink launched a new service offering Medical Tourism programs to foreigners travelling in Malaysia. This service offers individuals the opportunity to secure expert medical advice as part of a travel package. The impetus behind this offering is that healthcare services can be offered in Malaysia at an affordable cost without compromising quality of care and patient safety. Medilink recently showcased the country's healthcare facilities, expertise and state-of-the-art medical technology to a panel of Chinese government delegates, with a view of demonstrating the quality of Malaysia's healthcare services to them and in turn to promote Medilink's new Medical Tourism offering.

To support the expanded business activities and maintain the quality of service provided we decided to increase our headcount in Malaysia. This led to a lower average monthly revenue per employee during the year of £1,410 as compared to previous year of £1,431, in spite of revenues in Malaysia marginally increasing by 1% compared to the previous year. The 1% increase in revenue was attributed to existing TPA business whilst the new Medical Tourism program has yet to generate significant revenue. With the new infrastructure now in place we expect that the Group's monthly average revenue per employee for Malaysia to improve as the business continues to grow.

Singapore

Medilink's operations in Singapore have been progressing well with revenues increasing by 20% over the previous year and the number of healthcare providers in our network increasing to 146, compared to 126 in the previous year. The average monthly gross profit per employee increased to £2,211, compared to £1,784 in the previous year and the trend is expected to continue.

Thailand

The progress of Medilink's associated company in Thailand slowed down due to the political upheaval and we expect that the Group's operations in Thailand will continue to sustain minor losses before moving into profitability in 2013. The healthcare providers in our network in Thailand remained at 101 (2009: 101).

PROSPECTS

Medilink is to continue with its expansion plans into the next financial year and we anticipate the Group to sustain minor losses in 2011 as the expected increase in revenues in 2011 will not be sufficient to cover the Group's operating costs. The Board remain confident of being able to move into profitability during 2012.

We will continue to strengthen all areas of the organisation and maintain our position as a leading regional TPA with a global servicing capacity.

However, as explained earlier, we believe that greater impetus will be made in China where the potential revenue returns per membership obtained are significant, and in this regard, the Company is striving to be the leading TPA in the country.

ACKNOWLEDGMENTS

On behalf of the board, I should like to extend our heartfelt thanks to our business partners, customers, associates, healthcare providers and valued shareholders for their support throughout the year. We also wish to thank the management and staff of the entire Group for their continued loyalty and commitment in discharging their duties.

Norman Lott

Chairman

30 June 2011

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

* In accordance with IAS 33 "Earnings per share" and as the Group has reported a loss for the period the shares are not diluted. The Group has not issued any instruments with dilutive effects.

All operations of the Group are continuing.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

CONSOLIDATED STATEMENT OF CASH FLOWS

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

SELECTED NOTES TO THE FINANCIAL INFORMATION

FOR THE YEAR ENDED 31 DECEMBER 2010

1. Basis of preparation

The financial information has been prepared in accordance with International Financial Reporting Standards as adopted by the European Union and using accounting policies which are consistent with those adopted in the financial statements, with the following comment in respect of going concern made in note 2(v) to the financial statements:

"The financial statements have been prepared on a going concern basis. The Group's ability to continue as a going concern is reliant upon continuing shareholder support or successfully obtaining alternative means of funding as it moves towards self-sustainability and to finance its on-going expansion. In considering the appropriateness of this basis of preparation, the Directors have reviewed the Company's working capital forecasts and performed sensitivity analysis thereon and the key inputs into these can be found in note 10 in the annual report and accounts. They believe that the recently received shareholder loan of £308,000 together with increasing revenues from trading activities will be sufficient for the Group's purposes for a minimum of 12 months from the date of the approval of these financial statements. Furthermore, in order to develop the Group further, the Directors have sought and obtained the assurances of key shareholders who have committed to provide unconditional financial support to the Group. The Directors have considered and assessed the letter of support provided by these key shareholders and are satisfied that they will and can, if required, provide the support for the development of the growth over at least the next twelve months from signing these financial statements. If the Group was unable to secure sufficient funding to enable it to continue on a going concern basis then adjustments would be necessary to write down assets to their recoverable amounts, reclassify fixed assets and long-term liabilities as current and provide for additional liabilities. Furthermore, assuming a commitment of the key shareholders of approximately £200,000, a 10% reduction in the planned revenue growth forecasts of 78% in the next twelve months would reduce the headroom in the forecasts by £318,000.

The financial information set out in this announcement does not constitute the Group's statutory financial statements for the period ended 31 December 2009, but was derived from those financial statements. The auditors have reported on the statutory financial statements for the period ended 31 December 2010; this report was unqualified but included the following emphasis of matter:

"In forming our opinion on the financial statements, which is not modified, we have considered the adequacy of the disclosure made in note 2 (v) to the financial statements concerning the company's ability to continue as a going concern. The financial statements have been prepared on the going concern basis, which depends on the continued shareholder support and the generation of increased revenues. These conditions, along with the other matters explained in note 2 (v) to the financial statements, indicate the existence of a material uncertainty which may cast significant doubt about the company's ability to continue as a going concern. The financial statements do not include the adjustments that would result if the company was unable to continue as a going concern."

The financial information set out in this announcement was approved by the board on 30 June 2011.

The directors do not recommend the payment of a dividend.

2. Operating segments

The Group has adopted IFRS 8 Operating Segments with effect from 1 January 2009. Per IFRS 8 operating segments are based on internal reports about components of the group, which are regularly reviewed and used by the Board of Directors being the Chief Operating Decision Maker ("CODM") for strategic decision making and resource allocation, in order to allocate resources to the segment and to assess its performance. The Group's reportable operating segments are as follows:

i) Third party administrator

ii) Software licensing

The CODM monitors the operating results of each segment for the purpose of performance assessments and making decisions on resource allocation. The management has organised the entity based on differences in products and services. Third party administrator segment is derived from aggregating China, Malaysia and Singapore entity while Software licensing segment represent a single entity from Malaysia. Performance is based on external and internal revenue generations and profit before tax, which the CODM believes are the most relevant in evaluating the results relative to other entities in the industry. Segment assets and liabilities are presented inclusive of inter segment balances, as inter-segment pricing. Information regarding each of the operations of each reportable segment is included below.

(i) The assets of third party administrator are including the goodwill on consolidation of £4,138,000 (2009: £4,138,000)

Revenues from two customers amounted to £450,000: ING Insurance Bhd £296,000 and AXA Insurance Bhd £154,000 (2009: £349,000: ING Insurance Bhd £204,000 and AXA Insurance Bhd £145,000), arising from sales by third party administrator segment.

(i) The assets of third party administrator are including the goodwill on consolidation of £4,138,000.

The geographical split of revenue and non-current assets arises as follows:

3. Taxation

The applicable tax of the Group is derived from the consolidation of all Group companies applicable tax band on their domestic tax rates.

4. Intangible assets

The amortisation recognised in respect of intellectual property has been included in the line item, administrative expenses in the consolidate statement of income.

Description of intangible assets

Goodwill arising on the acquisition of the subsidiaries represents the excess of the cost of acquisition over the Group's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the subsidiaries recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. The carrying value of goodwill is allocated to the respective segments as follows: -

System software comprises Electronics Claims Clearance System and Loyalty Programme software. The system software is initially recognised based on the cost that would be incurred in re-creating the asset and is subsequently amortised based on straight-line method over a period of three years. Contracted customers are the existing customers of the acquired subsidiaries. The contracted customers are initially recognised based on the estimated net present value of the service contracts entered into between the customers and subsidiaries acquired and is subsequently amortised based on straight-line method over a period of five years. The recoverable amount of cash generating unit is determined based on value in use calculation as set out below.

The goodwill and other intangible assets are reviewed for impairment annually or more frequently if events or changes in circumstances indicate that the assets might be impaired. The 2010 review was undertaken in the last month of the year in conjunction with our annual business planning process and no goodwill and intangible asset impairments were identified (2009: Nil).

Management have approved the forecast for 2011 and have prepared additional projection based on the 2011 numbers for the next four years. This was used as the basis for determining the recoverable amount of each CGU.

In conducting the review we used a growth rate 10% to 50% and a market beta of 4.

Management are satisfied that there are no reasonably possible changes in key assumptions, which would cause the recoverable amount of any of our GGUs to be below their carrying amount.

The key assumptions used in the forecast are as follows:

Sensitivity analysis

A sensitivity analysis has been carried out for each CGU. The results of the analysis can be summarises as follow:

If the estimated growth rate to forecast the revenue had been 10 percent point lower than the basis assumption, total recoverable amount would be 12 percent lower.

If the estimated discount rate used for the Group's discount cash flow had been one percentage point higher than the starting assumption of 25%, total recoverable amount would be 3 percent lower.

These calculations are hypothetical and should not be viewed as an indication that these figures are any more or less likely to be changed. The sensitivity analysis should therefore be interpreted with caution.

5. Share capital

The Company has one class of ordinary share capital which carries no rights to fixed income, any preferences or restrictions.

During the year, 1,784,433 and 13,270,000 ordinary of 5p each were issued at 18p and 10p respectively.

6. Loss per share

Basic loss per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period. In accordance with IAS 33, and as the Group has reported a loss for the year, the shares are not diluted.

7. Related party transactions

Related party transactions during the year were as follow:

The term of the loan from a shareholder is interest free and with fixed term of repayment as follow:

1st repayment of £200,000 on 31 August 2011; and

Final remaining balance repayment on 28 February 2012.