Half Yearly Report

1 October 2015

MediLink-Global UK Limited

("MediLink" or "the Company")

HALF-YEARLY REPORT for the six months to 30 june 2015

MediLink, the provider of electronic healthcard network services to insurance companies and corporate organisations to help them facilitate the administration of medical claims and healthcare data management, announces its interim results for the six months ended 30 June 2015.

Financial highlights

· Revenue increased by 2.3% to £704,000 (H1 2014: £688,000);

· Revenue contribution from Malaysia operations increased by 4.6% to £412,000 (H1 2014: £394,000);

· Operating loss for continuing operations reduced by 11% to £112,000 (H1 2014: £126,000); and

· The marginal improvement in operating performance was attributable to revenue growth in Malaysia and continued cost saving measures within MediLink's operations.

Operational highlights

Medilink Malaysia

· The Directors continue to believe there is growing demand in Malaysia for Third Party Administration ("TPA") services in the Small and Medium Enterprises Sector as well as Government-link agencies, Government-link bodies and Government-link corporations. Medilink Global (M) Sdn Bhd ("MGMY") is now focusing its business development effort in these growing market segments.

· During the period under review, Medilink Malaysia has won contracts with several clients including those detailed below:

TPA Services:

v January 2015: ERL Maintenance Support Sdn Bhd (E-MAS)

E-MAS, established in 1999 to commission, operate and maintain the Express Rail Link (ERL), Malaysia's fastest, and most intensive railway system.

Medilink Malaysia was appointed to provide TPA services, serving its 1100 employees and dependents

v January 2015: Global Educare Sdn Bhd

Medilink Malaysia was appointed to provide TPA services, serving its 500 employees

v June 2015: Tekun Nasional

Medilink Malaysia was appointed to provide TPA services, to Tekun Nasional, a Malaysian Government-Link Agency, serving its 3300 employees and dependents, for a period of 2 years, ending May 2017

v June 2015: MY E.G Services Berhad (MYEG)

MYEG, a concessionaire for Malaysian Electronic-Government ("E-Government") MSC Flagship Application, appointed Medilink Malaysia to provide TPA services to its 2000 employees and dependents

System and Network Infrastructure services:

In collaboration with Qualitas Medical Group Sdn Bhd, a Malaysian based primary healthcare provider group with operations in Malaysia and several countries in the Asia Pacific region, Medilink Malaysia licensed the use of its Claims Management system and front-end electronic healthcard network infrastructure, to facilitate on-line-real-time member's eligibility validation and submission of primary care claims.

Through this collaboration, an additional 12,000 members from a total of 58 employers newly acquired, were added to the Medilink service platform as of September 2015.

· AIA Bhd (AIA) contributed an additional 63,000 members to the membership growth of Medilink Malaysia; during the period under review.

The Board of Directors' of MediLink are confident that there will be a continuous positive effect for Medilink Malaysia in the years to come.

Enquiries: 

CHAIRMAN'S STATEMENT

The Board of MediLink is pleased to present the Group's unaudited results for the six month period ended 30 June 2015, which show an encouraging trend in improved operating performance compared with the comparative period for the six months ended 30 June 2014.

FINANCIAL REVIEW

The Group recorded revenues of £708,000 (H1 2014: £688,000) and a reduced loss after tax of £112,000 (H1 2014: £126,000) for the six months ended 30 June 2015 for continuing operations

Growth in revenues increased marginally by 2.3% over the same period last year, with revenue from Malaysia growing by 4.56% and TPA income increasing by 6.4%. The Malaysian operating entities continued to make the largest contribution of 59% (H1 2014: 57%) of the Group's revenues for the period under review, whilst Singapore contributed 41% (H1 2014: 43%).

The operating loss for the period was lower compared to the same period last year as a result of revenue growth in Malaysia and the cost saving measures taken across all the subsidiaries of Medilink resulting in a 7% reduction in administrative costs. In addition the losses from Medilink China were marginally lower than the corresponding period in 2014

PERIOD IN FOCUS

The first half of 2015 witnessed another increase in revenue in Malaysia from £394,000 in the first half of last year to £412,000 for the six months to 30 June 2015, representing a 4.7% growth over the same period last year. The number of enrolled members in Malaysia as at the end of August 2015 was approximately 1,000,000 (1 September 2014 - 900,000) while the number of corporate clients contracted stands at 225 compared to 210 at the same stage last year. The number of healthcare providers operating in our network in Malaysia now stands at 1,500 (1480 at this stage last year). Maintaining overheads at the same levels as the corresponding period last year combined with the growth in membership levels has helped to increase the operating profit in Malaysia significantly, by approximately 90%, for the first half of 2015 compared with the first half of 2014. Management are not anticipating a significant increase in operating costs in the second half of 2015.

Further to the completion and deployment of the Claims Management System licensing to Great Eastern Life Assurance Co., Ltd on September 11, 2015, the Malaysia entity is currently finalizing an 18 months contract with an established Malaysian insurance company.

The operations in Singapore recorded a marginal decrease in revenues by 0.7% to £292,000 (2014: £294,000) compared with the same period last year.

On 1 August 2014, the Group entered into a Sales and Purchase Agreement with Selfdoctor (Beijing) Technology Co. Limited to divest 51% of its interest in Medilink (Beijing) TPA Services Co Limited. The divestment was fully completed on 10 July 2015 when the transfer of ownership took place. With a strategic local partner in place and with enhanced financial support it is believed this will add value to the China business and help expand Medilink China's business activities.

PROSPECTS

The revenues are expected to be stronger particularly with the impact of continued growth in TPA membership as well as system licensing in our Malaysia operations, the Directors are confident that the Group's financial performance should continue to improve in the second half of 2015 and during the financial years thereafter.

Norman Lott

Chairman

Consolidated Statement of Comprehensive Income

Six month period ended 30 June 2015

* In accordance with IAS33 "Earnings per share" and where the Group has reported a loss for the period, the potential shares are not dilutive. The Group has not issued any instrument with dilutive effect.

Consolidated Statement of Financial Position

As at 30 June 2015

Consolidated Statement of Cash Flows

Six months ended 30 June 2015

Consolidated Statement of Changes in Equity

Six months ended 30 June 2015

Notes to the Interim Financial Information

Six month period ended 30 June 2015

1. Basis of preparation

The financial information has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. The principal accounting policies used in preparing the interim results are consistent with those the group expects to apply in its financial statements for the year ending 31 December 2015 and are consistent with those disclosed in the group's Report and Financial Statements for the year ended 31 December 2014.

The interim results have not been reviewed nor audited by the Company's auditors. The comparatives for the year ended 31 December 2014 are not the Company's full statutory financial statements for that period. A copy of the statutory financial statements for that period, which were prepared under IFRS, have been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified, but included an emphasis of matter in respect of going concern:

"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."

Whilst the financial information included in this Interim Financial information has been prepared in accordance with the recognition and measurement criteria of IFRS, it does not include sufficient information to comply with IFRS.

The interim results announcement was approved by the board on 30 September 2015.

2. Basic and diluted loss per ordinary 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 where the Group has reported a loss for the period, the shares are not dilutive.

3. Discontinued operations

On 1 August 2014, the Group publicly announced the divestment of 51% interest in Medilink (Beijing) TPA Services Co Limited ("Medilink China"), a wholly owned subsidiary, to Selfdoctor (Beijing) Technology Co Limited ("Selfdoctor") for a nominal consideration of RMB 10.00 (approximately £1.00) (the "Divestment"). The Group retain a 49% interest in Medilink China.

The completion of the divestment took place on 10 July 2015, when the transfer of ownership actually took place. At 31 December 2014, Medilink China was classified as a disposal group held for sale and as discontinued operations.

The business of Medilink China represents the entirety of the Group's operating segment in China. With Medilink China being classified as discontinued operations, the China operating segment is no longer presented as an operating segment. The results of Medilink China for the year are presented below:

 The major classes of assets and liabilities of Medilink China classified as assets held for sale as at 30 June 2015 are, as follow:

The net cash flows incurred by Medilink China are, as follow:

4. Dividend

The Directors do not propose a dividend in the period.

5. Taxation

No charge to taxation arises in the six months ended 30 June 2015.

6. Turnover and segmental analysis

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 include the goodwill on consolidation of £1,338,000.

Revenues from the Group's major customer AIA Bhd amounted to £276,621: (H1 2014: £282,485) arising from sales in the third party administrator segment.

The assets of third party administrator include the goodwill on consolidation of £3,038,000.

The assets of third party administrator are including the goodwill on consolidation of £1,338,000 (2013: £3,038,000)

Revenues from customers amounted to £263,249: AIA Bhd (Previously known as ING Insurance Bhd) compared with year 2013: £243,685: AIA Bhd, arising from sales by third party administrator segment.

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

7. Share capital

MGL have one class of ordinary share capital which carry no rights to fixed income, any preferences or restrictions.

Authorised share capital (unaudited):

8. Foreign currency exchange rate

The following significant exchange rates applied during the period:

9. Post Balance Sheet Event

On 1 August 2014, the Group entered into a Sales and Purchase Agreement with Selfdoctor (Beijing) Technology Co. Limited to divest 51% of its interest in Medilink (Beijing) TPA Services Co Limited. The divestment was fully completed on 10 July 2015 when the transfer of ownership took place. With a strategic local partner in place and with enhanced financial support it is believed this will add value to the China business and help expand Medilink China's business activities

10. Nature of financial information

These interim results will be available shortly on the Company's website, www.medilink-global.com in accordance with the AIM Rules. Further copies can be obtained from the registered office at Queensway House, Hilgrove Street, St Helier, Jersey JE1 1ES.

11. Seasonality of the group business

There are no seasonal factors that materially affect the operations of any company in the Group.

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