Half Yearly Report

28 September 2012

MediLink-Global UK Limited

("MediLink" or "the Company")

HALF-YEARLY REPORT for the six months to 30 june 2012

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 2012.

Financial highlights

·; Revenue increased by 10% to £958,000 (H1 2011: £871,000);

·; Revenue contribution from China operations was £235,000 (H1 2011: £175,000);

·; Operating loss reduced to £366,000 (H1 2011: £613,000 operating loss); and

·; Improvement in trading performance was mainly attributable to revenue growth in Malaysia and China and the cost saving measures taken particularly in relation to MediLink's operations in Singapore.

Operational highlights

·; On 2 January 2012, AXA Affin Life Insurance Berhad ("AXA-Life") launched its health insurance product and appointed Datalink Healthcard Network Sdn Bhd ("Datalink Healthcard") (a wholly owned subsidiary of the Company) as the Third Party Administrator in administering and processing the medical claims for this business portfolio. An addendum to the existing service agreement between AXA Affin General Insurance Berhad and the Company was concluded on April 20, 2012.

·; As at 31 August 2012 Datalink Healthcard had signed up 29 new self-insured corporate clients in 2012 with the estimated annualised value of these contracts being RM425,000 (approximately £85,000). Out of this total Bank Muamalat Malaysia Berhad, with an enrolled membership of 6,285, made a significant contribution in this regard.

·; The renewal of Third Party Administrator ("TPA") contracts and new TPA contracts secured in China included the following:

o On 1 January 2012, the Company renewed their existing contract with CITIC Prudential for a further year.

o On 30 April 2012, the Company entered into a one year contract with Aetna International Inc.

o On 1 July 2012, the Company entered into a one year contract with Liberty Insurance.

o On 1 August 2012, the Company renewed their existing contract with Generali China Life Insurance Co. Ltd for a further three years.

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 2012 which show an encouraging trend of improved operating performance compared to the comparative period for the six months ended 30 June 2011.

FINANCIAL REVIEW

The Group recorded revenues of £958,000 (H1 2011: £871,000) and a loss after tax of £367,000 (H1 2011: £622,000) for the six months ended 30 June 2012.

Growth in revenues, which increased by 10% over the same period last year, with revenue from Malaysia and China increased by 16% and 34% respectively. The Malaysian operating entities continued to make the largest contribution of 47% (H1 2011: 45%) of the Group revenues for the period under review, whilst China and Singapore contributed 24% (H1 2011: 20%) and 29% (H1 2011: 35%) respectively.

The operating loss for the period was lower compared to the same period last year as a result of revenue growth in Malaysia and China and the cost saving measures taken particularly in relation to operations in Singapore.

PERIOD IN FOCUS

The first half of 2012 witnessed another increase in revenue in China from £175,000 in the first half of last year to £235,000 representing a 34% growth over the same period last year. The number of enrolled members in China as at the end of August was approximately 17,500 (August 2011 - 11,000) while the number of insurance companies contracted stands at 25 compared to 15 at the same stage last year. The number of healthcare providers operating in our network in China now stands at 294 (255 at this stage last year). The loss incurred in MediLink's operations in China remains consistent with the comparative period last year due to the corresponding increase in staff costs. Management are not anticipating a significant increase in operating costs in the second half of 2012.

The increase in revenue from our Malaysia operations compared with the same period last year was due to the continuous growth in member enrollment especially from our self insured corporate clients. As a result, a lower loss of £5,000 in Malaysia was recorded compared to loss of £101,000 in the same period last year as the region moves in to profitability.

The Group relocated its Singapore operations to Malaysia in the last quarter of 2011, in order to improve the efficiency of the Group and as a cost saving measure. This has effectively reduced our operating costs in this division by 42%.

PROSPECTS

With the steady increase in member enrollment numbers in all regions, the Directors are confident that the Group's financial performance should continue to improve in the second half of 2012.

Norman Lott

ChairmanConsolidated Statement of Comprehensive Income

Period ended 30 June 2012

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

Consolidated Statement of Financial Position

As at 30 June 2012

Consolidated Statement of Cash Flows

Six months ended 30 June 2012

Consolidated Statement of Changes in Shareholder' Equity

Notes to the Interim Financial Information

Period ended 30 June 2012

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 those the group expects to apply in its financial statements for the year ending 31 December 2012 and are unchanged from those disclosed in the group's Report and Financial Statements for the year ended 31 December 2011.

The interim results have not been reviewed nor audited by the Company's auditors. The comparatives for the year ended 31 December 2011 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 28 September 2012.

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 diluted

3 Dividend

The Directors do not propose a dividend in the period.

4 Taxation

The interim tax credit reflects an estimate of the likely effective tax rate for the period.

5 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 £3,038,000.

Revenues from two customers amounted to £265,000 : ING Insurance Bhd £158,000 and AXA Insurance Bhd £107,000 (1H 2011: £244,000: ING Insurance Bhd £158,000 and AXA Insurance Bhd £86,000), arising from sales in the third party administrator segment.

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

(i) The assets of third party administrator are including the goodwill on consolidation of £3,038,000.

Revenues from two customers amounted to £506,000 : ING Insurance Bhd £310,000 and AXA Insurance Bhd £196,000, arising from sales by third party administrator segment.

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

6 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):

7 Foreign currency exchange rate

The following significant exchange rates applied during the period:

8 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.

- Ends -