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1 GET HOLDINGS LIMITED * 8100 GEM GEM * * 1

2 GEM GEMwww.hkgem.com 2

3 CHARACTERISTICS OF GEM OF THE STOCK EXCHANGE OF HONG KONG LIMITED (THE STOCK EXCHANGE ) GEM has been positioned as a market designed to accommodate small and mid-sized companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration. Given that the companies listed on GEM are generally small and mid-sized companies, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board of the Stock Exchange and no assurance is given that there will be a liquid market in the securities traded on GEM. Hong Kong Exchanges and Clearing Limited and the Stock Exchange take no responsibility for the contents of this report, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this report. This report, for which the directors (the Directors ) of GET Holdings Limited (the Company ) collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on GEM (the GEM Listing Rules ) for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief: (1) the information contained in this report is accurate and complete in all material respects and not misleading or deceptive; (2) there are no other matters the omission of which would make any statement in this report misleading; and (3) all opinions expressed in this report have been arrived at after due and careful consideration and are founded on bases and assumptions that are fair and reasonable. GEM GEM GEMGEM GEM GEM GEM (1) (2)(3)

4 CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS UNAUDITED For the three months and six months ended 30 June 2018 The board of Directors (the Board ) of GET Holdings Limited (the Company ) is pleased to announce the unaudited condensed consolidated results of the Company and its subsidiaries (collectively referred to as the Group ) for the three months and six months ended 30 June 2018, together with the comparative unaudited figures for the corresponding periods in 2017, as follows: Three months ended 30 June Six months ended 30 June Note HK$ 000 HK$ 000 HK$ 000 HK$ 000 Continuing operations Revenue 4 32,414 44,046 69,438 99,754 Cost of sales and services rendered (12,450) (15,197) (26,048) (37,900) Gross profit 19,964 28,849 43,390 61,854 Other revenue and other gains and losses, net 5 (170,111) 31,131 (169,488) (5,628) Selling and administrative expenses (17,871) (18,431) (39,079) (37,676) (Loss)/profit from operations (168,018) 41,549 (165,177) 18,550 Finance costs 6(a) (3,720) (9,089) Share of (loss)/profit of an associate (12,899) 4,507 (13,581) 5,209 Share of loss of a joint venture (765) (1,174) (Loss)/profit before taxation 6 (181,682) 42,336 (179,932) 14,670 Income tax expense 7 (1,242) (2,468) (2,752) (5,324) (Loss)/profit for the period from continuing operations Discontinued operation Profit for the period from discontinued operation (182,924) 39,868 (182,684) 9, ,123 (Loss)/profit for the period (182,924) 39,868 (182,684) 12,469 2 GET Holdings Limited Interim Report 2018

5 CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS UNAUDITED For the three months and six months ended 30 June 2018 Three months ended 30 June Six months ended 30 June Note HK$ 000 HK$ 000 HK$ 000 HK$ 000 Attributable to: Owners of the Company (Loss)/profit from continuing operations (184,634) 35,698 (186,667) 483 Profit from discontinued operation 2,497 (Loss)/profit attributable to owners of the Company (184,634) 35,698 (186,667) 2,980 Non-controlling interests Profit from continuing operations 1,710 4,170 3,983 8,863 Profit from discontinued operation 626 Profit attributable to non-controlling interests 1,710 4,170 3,983 9,489 (Loss)/profit for the period (182,924) 39,868 (182,684) 12,469 (Loss)/earnings per share 9 From continuing and discontinued operations Basic HK(41.54) cents HK8.03 cents HK(42.00) cents HK0.73 cent Diluted HK(41.54) cents HK7.38 cents HK(42.00) cents HK0.73 cent From continuing operations Basic HK(41.54) cents HK8.03 cents HK(42.00) cents HK0.12 cent Diluted HK(41.54) cents HK7.38 cents HK(42.00) cents HK0.12 cent From discontinued operation Basic N/A N/A N/A HK0.61 cent Diluted N/A N/A N/A HK0.55 cent

6 CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME UNAUDITED For the three months and six months ended 30 June 2018 Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Loss)/profit for the period (182,924) 39,868 (182,684) 12,469 Other comprehensive income for the period: Items that will be reclassified to profit or loss: Fair value (loss)/gain on available-for-sale financial assets, net (11,686) 2,484 Exchange difference on translation of financial statements of overseas subsidiaries and an associate (6,452) (1,098) Reclassification adjustment to profit or loss on disposal of available-for-sale financial assets 2,733 2,733 Items that will not be reclassified to profit or loss: Change in fair value of equity investments at fair value through other comprehensive income 1,223 4,342 Disposal of equity investments at fair value through other comprehensive income (16,322) (16,322) Reclassification adjustment to other comprehensive income on disposal of equity investments at fair value through other comprehensive income 15,842 15,842 Other comprehensive income for the period, net of tax (5,709) (8,953) 2,764 5,217 Total comprehensive income for the period (188,633) 30,915 (179,920) 17,686 Attributable to: Owners of the Company (190,343) 26,745 (183,903) 8,197 Non-controlling interests 1,710 4,170 3,983 9,489 (188,633) 30,915 (179,920) 17,686 4 GET Holdings Limited Interim Report 2018

7 CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 30 June June December 2017 HK$ 000 HK$ 000 Note (Unaudited) (Audited) Non-current assets Property, plant and equipment 1,215 1,877 Investment properties 12 38,000 38,300 Intangible assets 81,427 79,777 Goodwill , ,356 Investment in an associate 13,503 28,182 Investment in a joint venture 3,418 Available-for-sale financial assets 37,149 Financial assets at fair value through other comprehensive income 14 37, , ,059 Current assets Inventories 1, Trade and other receivables 15 67,866 78,846 Financial assets at fair value through profit or loss 16 6,466 9,656 Tax recoverable 2,067 5,391 Pledged bank deposits 1,633 2,645 Cash and cash equivalents 114, , , ,621 Current liabilities Trade and other payables 17 16,785 17,721 Current tax liabilities 26,755 26,825 43,540 44,546 Net current assets 150, ,075 Total assets less current liabilities 472, ,134 Non-current liabilities Deferred tax liabilities 11,946 12,301 11,946 12,301 NET ASSETS 460, ,

8 CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 30 June June December 2017 HK$ 000 HK$ 000 Note (Unaudited) (Audited) Capital and reserves Share capital 19 4,444 4,444 Reserves , ,919 Equity attributable to owners of the Company 427, ,363 Non-controlling interests 33,078 37,470 TOTAL EQUITY 460, ,833 6 GET Holdings Limited Interim Report 2018

9 CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY UNAUDITED Attributable to owners of the Company Share capital Share premium Contributed surplus Share option reserve Convertible note equity reserve Exchange reserve Investment revaluation reserve Accumulated losses Total Noncontrolling interests Total equity HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 At 1 January , , ,154 2,839 25,555 (26) 3,072 (423,344) 1,047,535 34,915 1,082,450 Profit for the period 2,980 2,980 9,489 12,469 Other comprehensive income for the period 5,217 5,217 5,217 Total comprehensive income for the period 5,217 2,980 8,197 9,489 17,686 Disposal of a subsidiary (1,990) (1,990) Rights issue of shares on 15 February ,481 72,859 74,340 74,340 Changes in equity for the period 1,481 72,859 74,340 (1,990) 72,350 At 30 June , , ,154 2,839 25,555 (26) 8,289 (420,364) 1,130,072 42,414 1,172,486 At 1 January , , ,154 1,420 4,861 (908,697) 611,363 37, ,833 Adjustment on initial application of HKFRS 9 (Note 3) 93 (36,250) 36,250 Restated balance at 1 January , , ,154 1,420 4,861 (36,250) (872,447) 611,363 37, ,833 Profit for the Period (186,667) (186,667) 3,983 (182,684) Other comprehensive income for the Period (1,098) 20,184 (16,322) 2,764 2,764 Total comprehensive income for the Period (1,098) 20,184 (202,989) (183,903) 3,983 (179,920) Dividends paid to non-controlling interests Deconsolidation of subsidiaries (note 18(a)) (9,458) (9,458) 18(a) 1,083 1,083 Changes in equity for the Period (8,375) (8,375) At 30 June , , ,154 1,420 3,763 (16,066) (1,075,436) 427,460 33, ,

10 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS UNAUDITED Six months ended 30 June HK$ 000 HK$ 000 Net cash generated from operating activities 28,212 37,894 Net cash used in investing activities (6,192) (44,083) Net cash used in financing activities (9,458) (11,039) Net increase/(decrease) in cash and cash equivalents 12,562 (17,228) Cash and cash equivalents at 1 January 101,548 87,350 Cash and cash equivalents at 30 June 114,110 70,122 Analysis of cash and cash equivalents: Cash and bank balances 114,110 70,122 8 GET Holdings Limited Interim Report 2018

11 1. CORPORATE INFORMATION 1. The Company was incorporated as an exempted company with limited liability in the Cayman Islands on 30 July 2001 and continued in Bermuda on 9 January 2014 (Bermuda time). The registered office of the Company is Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda. The principal place of business of the Company in Hong Kong is located at 21/F., China Hong Kong Tower, 8-12 Hennessy Road, Wanchai, Hong Kong. Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda The Company is listed on GEM ( GEM ) of The Stock Exchange of Hong Kong Limited ( Stock Exchange ). The principal activity of the Company is investment holding. The Group is principally engaged in (i) research, development and distribution of personal computer performance software, anti-virus software, mobile phone applications and toolbar advertisements; (ii) securities investment; (iii) money lending; and (iv) provision of corporate management solutions and information technology ( I.T. ) contract services during the six months ended 30 June 2018 ( Period ). GEM GEM (i) (ii) (iii)(iv) In view of the instabilities lurking in the global economy as well as the volatile financial market in Hong Kong, after careful consideration, the Board decided to suspend the operation of the Money Lending Business and the Securities Investment Business (both as defined below) with effect from 11 May On 21 March 2017, after the completion of disposal of approximately 32% of the issued shares of GET Mdream Wealth Management Limited ( GET Mdream ), the Group s shareholding in GET Mdream was reduced from approximately 51% to approximately 19%. Accordingly, GET Mdream became an investment of the Group without control and the provision of insurance and mandatory provident fund schemes brokerage services was classified as a discontinued operation during the six months ended 30 June On 1 February GET Mdream allotted and issued 5,882,353 new shares to another existing shareholder. Upon completion of this allotment, the Group held approximately 2.5% of the issued share capital of GET Mdream. 32% 51%19% 5,882, % This unaudited condensed consolidated interim financial information is presented in thousands of units of Hong Kong Dollars ( HK$ 000 ), unless otherwise stated. Hong Kong dollars ( HK$ ) is the Company s functional and the Group s presentation currency

12 2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS 2. The unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the Hong Kong Accounting Standard 34 Interim Financing Reporting issued by the Hong Kong Institute of Certified Public Accountants ( HKICPA ), accounting principles generally accepted in Hong Kong and the Rules Governing the Listing of Securities on GEM ( GEM Listing Rules ) of the Stock Exchange. 34 GEM GEM The Group s 2018 interim unaudited condensed consolidated financial statements should be read in conjunction with the annual consolidated financial statements for the year ended 31 December 2017 and have been prepared under the historical cost convention, except for investment properties, contingent consideration receivable and certain financial instruments that are measured at fair values. The principal accounting policies used in the preparation of these unaudited condensed consolidated financial statements are consistent with those used in the annual consolidated financial statements for the year ended 31 December 2017 except for the new and revised standards, amendments and interpretations ( new and revised HKFRSs ) issued by the HKICPA that are adopted for the first time for the current period s financial statements and the accounting treatment of deconsolidation as a result of the loss of control over AP Group Investment Holdings Limited ( AP Group Investment, together with its subsidiaries, referred to as the AP Group ) as mentioned below. Deconsolidation Reference is made to the announcements of the Company dated 27 July 2018 and 10 August As disclosed in the said announcements, legal action has been taken by the Group against Mr. Chan Sze Long ( 1st Defendant ) as the 1st defendant and Ms. Lim Wah Elsa ( 2nd Defendant, together with the 1st Defendant, referred to as the Defendants ) as the 2nd defendant. The 1st Defendant and the 2nd Defendant are former directors of AP Group Investment until their respective resignations on 18 July The 1st Defendant and/or his controlled company, and the controlled company of the 2nd Defendant, are also former directors of the other members of the AP Group at all material times. After their resignations as director of AP Group Investment on 18 July 2018, the Defendants failed to deliver up all the accounting books and financial records of, and all businesses records in connection with, the running of the AP Group to the Group for it to prepare the condensed consolidated financial statements for the Period. Details relating to the Group s loss of control over the AP Group are set out in note 23(b). 23(b) 10 GET Holdings Limited Interim Report 2018

13 2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS (continued) Deconsolidation (continued) No response has been received from the Defendants regarding the full business records of the AP Group. As such, the Company is not able to compile proper consolidated financial statements of the Group involving the financial information of the AP Group for the purpose of preparing the interim results announcement and the interim report of the Group for the Period by the prescribed deadline in compliance with the requirements of the GEM Listing Rules. Although legal action had been instituted against the Defendants, the management of the Company considered that control over the AP Group had been lost and therefore it is appropriate for these subsidiaries to be deconsolidated from the Group s condensed consolidated financial statements. The Board resolved to deconsolidate the financial results of the AP Group from the Group s condensed consolidated financial statements with effect from 1 April Financial impact on deconsolidating the AP Group The deconsolidation of the AP Group resulted in a net loss on deconsolidation of subsidiaries of approximately HK$3,454,000 for the Period. As the Board was of the view that the amounts due from the AP Group were most likely not recoverable, an impairment loss on the amounts due from the AP Group of approximately HK$570,000 was also incurred for the Period. 3. ADOPTION OF NEW AND REVISED HONG KONG FINANCIAL REPORTING STANDARDS During the Period, the Group has adopted all the new and revised HKFRSs issued by the HKICPA that are relevant to its operations and effective for its accounting period beginning on 1 January HKFRSs comprise Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards, and Interpretations. The adoption of these new and revised HKFRSs did not result in significant changes to the Group s accounting policies and presentation of the Group s unaudited condensed consolidated financial statements, except for the adoption of HKFRS 9 Financial Instruments. Upon the adoption of HKFRS 9, the Group elected to classify all equity investments of the Group which were previously classified as available-for-sale financial assets ( AFS Financial Assets ) into financial assets at fair value through other comprehensive income ( FVTOCI Financial Assets ) because these investments have been held as long-term strategic investments that are not expected to be sold in the short term. As a result, the impairment loss on AFS Financial Assets previously recognised in profit or loss of approximately HK$36,250,000 was reclassified from accumulated losses to accumulated investment revaluation reserve on 1 January The reserve will no longer be reclassified to profit or loss upon impairment or disposal of equity investments. The Group has not early applied new and revised HKFRSs that have been issued but are not yet effective for the financial period beginning 1 January The Directors anticipate that the new and revised HKFRSs will be adopted in the Group s unaudited condensed consolidated financial statements when they become effective. The Group is in the process of assessing, where applicable, the potential effect of all new and revised HKFRSs that will be effective in future periods but is not yet in a position to state whether these new and revised HKFRSs would have a material impact on its results of operations and financial position. 2. GEM 3,454, , ,250,

14 4. REVENUE 4. Revenue represents the sales value of goods supplied and services provided to customers. An analysis of the Group s revenue for the periods is as follows: Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Continuing operations Sales of computer and mobile phone software and toolbar advertisement 19,598 26,258 43,115 56,844 Provision of corporate management solutions and I.T. contract services 11,372 13,458 20,334 33,619 Provision of kindergarten education 1,444 2,827 Provision of self-improvement and selfenhancement training programs 4,103 3,112 8,832 Loan interest income Other ,414 44,046 69,438 99, GET Holdings Limited Interim Report 2018

15 5. OTHER REVENUE AND OTHER GAINS AND LOSSES, NET 5. Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Continuing operations Other revenue Bank interest income Rental income Other loan interest income Dividend income Others ,641 Other gains and losses, net Loss on disposal of available-for-sale financial assets (2,775) (2,775) Gain on disposal of financial assets at fair value through profit or loss Loss on disposal of a joint venture (1,144) (1,144) Loss on deconsolidation of subsidiaries (Note 18(a)) 18(a) (3,454) (3,454) Loss on disposal of property, plant and equipment (1) Fair value (loss)/gain on financial assets at fair value through profit or loss (2,207) 37,495 (2,167) 15 Fair value loss on investment properties (300) (4,608) (300) (4,608) Fair value gain on contingent consideration receivable Impairment loss on amount due from deconsolidated subsidiaries (570) (570) Impairment loss on goodwill (Note 13) 13 (163,000) (163,000) Foreign exchange gains/(losses), net (47) (170,458) 30,232 (170,343) (7,269) Other revenue and other gains and losses, net (170,111) 31,131 (169,488) (5,628)

16 6. (LOSS)/PROFIT BEFORE TAXATION 6. (Loss)/profit before taxation has been arrived at after (crediting)/ charging: Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Continuing operations (a) Finance costs: (a) Effective interest on convertible notes 855 1,710 Interest on loan notes 2,865 7,379 3,720 9,089 (b) Staff costs (including directors remuneration): (b) Salaries, wages and other benefits 7,681 6,679 17,376 14,171 Retirement scheme contributions ,972 6,927 18,014 14,685 (c) Other items: (c) Amortisation of intangible assets 5,701 5,238 11,228 10,924 Auditor s remuneration Depreciation Operating lease charges: hire of office premises 1,350 1,521 3,674 3,042 Loss on disposal of available-for- # sale financial assets # 2,775 2,775 Loss on deconsolidation of subsidiaries # (Note 18(a)) # 18(a) 3,454 3,454 Loss on disposal of a joint venture 1,144 1,144 Gain on disposal of financial assets at fair value through # profit or loss # (24) (92) (69) (122) Loss on disposal of property, plant and equipment # # 1 Fair value gain on contingent # consideration receivable # (25) (25) Impairment loss on goodwill # (Note 13) # , ,000 Impairment loss on amount due from deconsolidated subsidiaries # # Legal and professional fees 1,322 1,922 1,539 2,886 Provision for/(reversal) of impairment loss on trade receivables 40 (173) 40 (208) Fair value loss on investment properties # # 300 4, ,608 # Included in other gains and losses. # 14 GET Holdings Limited Interim Report 2018

17 7. INCOME TAX EXPENSE 7. Income tax in the unaudited condensed consolidated statement of profit or loss represents: Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Continuing operations Current tax Hong Kong Profits Tax Provision for the period (Note 1) 1 1,371 2,675 3,194 5,761 Over-provision in respect of prior periods (148) (189) (158) Withholding tax for the period (Note 2) Deferred tax (Note 3) 3 (176) (185) (354) (448) 1,242 2,468 2,752 5,324 Note 1: The provision for Hong Kong Profits Tax is calculated at 16.5% of the estimated assessable profit for the periods % Taxation for overseas subsidiaries is charged at the appropriate current rates of taxation ruling in the relevant countries in which the Group operates based on existing legislation, interpretation and practices in respect thereof. Note 2: Withholding tax regarding the external sales for which customers are located outside Hong Kong, is charged at the appropriate current rates of taxation ruling in relevant countries. 2 Note 3: Deferred tax is arising from the tax effect on the temporary difference on intangible assets of the Group for the periods. 3 The Group s share of loss of an associate of approximately HK$13,581,000 (2017: share of profit of approximately HK$5,209,000) for the Period included share of the associate s taxation of approximately HK$151,000 (2017: approximately HK$26,000). The Group s share of loss of a joint venture of approximately HK$1,174,000 for the Period did not include any share of the joint venture s taxation. 13,581,0005,209, ,000 26,000 1,174,

18 8. DISCONTINUED OPERATION 8. On 21 March 2017, the Group disposed of approximately 32% of the issued share capital of GET Mdream to two independent third parties at an aggregate consideration of HK$3,000,000 in cash. After the completion of the disposal, the Group retained approximately 19% of the issued share capital of GET Mdream. GET Mdream became an investment of the Group without control and was classified as an available-for-sale financial asset accordingly. Immediately after the completion of the disposal, the Group discontinued its operation in Insurance and MPF Schemes Brokerage Business (as defined below) as one of its principal business activities. Details of the disposal are set out in the Company s announcement dated 21 March ,000,000 32% 19% On 1 February 2018, GET Mdream allotted and issued 5,882,353 new shares to another existing shareholder. Upon completion of this allotment, the Group held approximately 2.5% of the issued share capital of GET Mdream. 5,882, % The results of the discontinued operation for the periods are presented below: Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Revenue 29,940 Cost of sales and services rendered (23,768) Gross profit 6,172 Other revenue and other gains and losses, net 41 Selling and administrative expenses (4,935) Profit before taxation 1,278 Gain on disposal of discontinued operation 1,845 Profit for the period from discontinued operation 3,123 Profit for the period from discontinued operation (attributable to owners of the Company) 2, GET Holdings Limited Interim Report 2018

19 8. DISCONTINUED OPERATION (continued) 8. Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Profit for the period from discontinued operation includes the following: Staff costs: Salaries, wages and other benefits 2,041 Retirement scheme contributions 76 2,117 Other items: Depreciation 101 Auditor s remuneration 75 Operating lease charges: hire of office premises 1,094 Cash flows from discontinued operation Net cash inflows from operating activities 5,229 Net cash outflows from investing activities (2,125) Net cash inflows 3,

20 9. (LOSS)/EARNINGS PER SHARE 9. (a) Basic (loss)/earnings per share (a) The calculation of basic (loss)/earnings per share is based on the (loss)/profit attributable to owners of the Company and the weighted average number of ordinary shares in issue during the periods. Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (i) For continuing and discontinued operations (i) (Loss)/earnings (Loss)/profit attributable to owners of the Company and (loss)/earnings for the purpose of calculating basic (loss)/earnings per share (184,634) 35,698 (186,667) 2, Number of shares Weighted average number of ordinary shares for the purpose of calculating basic (loss)/earnings per share 444, , , ,002 Basic (loss)/earnings per share (HK cents) (41.54) 8.03 (42.00) GET Holdings Limited Interim Report 2018

21 9. (LOSS)/EARNINGS PER SHARE (continued) 9. (a) Basic (loss)/earnings per share (continued) (a) Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (ii) For continuing operations (ii) (Loss)/earnings (Loss)/profit attributable to owners of the Company and (loss)/earnings for the purpose of calculating basic (loss)/earnings per share (184,634) 35,698 (186,667) 483 Number of shares Weighted average number of ordinary shares for the purpose of calculating basic (loss)/earnings per share , , , ,002 Basic (loss)/earnings per share (HK cents) (41.54) 8.03 (42.00) 0.12 (iii) For discontinued operation Earnings Profit attributable to owners of the Company and earnings for the purpose of calculating basic earnings per share (iii) N/A N/A N/A 2,497 Number of shares Weighted average number of ordinary shares for the purpose of calculating basic earnings per share N/A N/A N/A 407,002 Basic earnings per share (HK cents) N/A N/A N/A

22 9. EARNINGS PER SHARE (continued) 9. (b) Diluted earnings per share (b) No adjustment has been made to the basic (loss)/earnings per share presented for (i) continuing operations and discontinued operation and (ii) continuing operations for the six months ended (i) 30 June 2018 and 2017 and three months ended 30 June 2018 (ii) in respect of a dilution as the share options outstanding as at 30 June 2018 and 2017 had no dilutive effect and impact of the convertible notes outstanding as at 30 June 2017 had anti- dilutive effect. The calculation of diluted earnings per share (i) continuing and (i) discontinued operations and (ii) continuing operations for the (ii) three months ended 30 June 2017; and discontinued operation for the six months ended 30 June 2017 was based on the profit attributable to owners of the Company and the weighted average number of ordinary shares in issue during the periods. Three months ended 30 June 2017 HK$ 000 (Unaudited) (i) For continuing and discontinued operations (i) Earnings Profit attributable to owners of the Company and earnings for the purpose of calculating diluted earnings per share Finance cost saving on conversion of convertible notes outstanding 35, Profit attributable to owners of the Company and earnings for the purpose of calculating diluted earnings per share 36, GET Holdings Limited Interim Report 2018

23 9. EARNINGS PER SHARE (continued) 9. (b) Diluted earnings per share (continued) (b) 000 (i) For continuing and discontinued operations (continued) (i) Number of shares Weighted average number of ordinary shares for the purpose of calculating basic earnings per share 444,448 Effect of dilutive potential ordinary shares from: Convertible notes 50,766 Weighted average number of ordinary shares for the purpose of calculating diluted earnings per share 495,214 Diluted earnings per share (HK cents)

24 9. EARNINGS PER SHARE (continued) 9. (b) Diluted earnings per share (continued) (b) Three months ended 30 June 2017 HK$ 000 (Unaudited) (ii) For continuing operations (ii) Earnings Profit attributable to owners of the Company and earnings for the purpose of calculating diluted earnings per share Finance cost saving on conversion of convertible notes outstanding 35, Profit attributable to owners of the Company and earnings for the purpose of calculating diluted earnings per share 36, Number of shares Weighted average number of ordinary shares for the purpose of calculating basic earnings per share 444,448 Effect of dilutive potential ordinary shares from: Convertible notes 50,766 Weighted average number of ordinary shares for the purpose of calculating diluted earnings per share 495,214 Diluted earnings per share (HK cents) GET Holdings Limited Interim Report 2018

25 9. EARNINGS PER SHARE (continued) 9. (b) Diluted earnings per share (continued) (b) Six months ended 30 June 2017 HK$ 000 (Unaudited) (iii) For discontinued operation (iii) Earnings Profit attributable to owners of the Company and earnings for the purpose of calculating diluted earnings per share 2, Number of shares Weighted average number of ordinary shares for the purpose of calculating basic earnings per share 407,002 Effect of dilutive potential ordinary shares from: Convertible notes 50,766 Weighted average number of ordinary shares for the purpose of calculating diluted earnings per share 457,768 Diluted earnings per share (HK cents)

26 10. SEGMENT REPORTING The Group manages its businesses by divisions, which are organised by a mixture of both business lines and geographical locations. In a manner consistent with the way in which information is reported internally to the Group s most senior executive management for the purposes of resources allocation and performance assessment, the Group had five reportable segments during the Period (2017: five): Continuing operations: 10. Research, development and distribution of personal computer performance software, anti-virus software, mobile phone applications and toolbar advertisement ( Software Business ) Securities investment ( Securities Investment Business ) Money lending ( Money Lending Business ) Provision of corporate management solutions and I.T. contract services ( Corporate Management Solutions and I.T. Contract Services Business ) Discontinued operation: Provision of insurance and MPF schemes brokerage services ( Insurance and MPF Schemes Brokerage Business ) The segment information reported does not include any amount for discontinued operation which is described in more detail in note 8 to the unaudited condensed consolidated financial statements contained in this report. The Group s other operating segments include (i) the provision of online shopping business; (ii) the provision of training programs for self-improvement and self-enhancement; and (iii) the provision of kindergarten education, which do not meet any of the quantitative thresholds for determining as reportable segments. The information of these other operating segments is included in the Others column. 8 (i)(ii) (iii) (a) Segment results (a) For the purposes of monitoring segment performances and allocating resources among segments: Segment profit/(loss) represents profit earned by/ (loss from) each segment without allocation of central administration costs, finance costs and income tax expense and did not include share of (loss)/profit of an associate and share of loss of a joint venture. Segment revenue reported below represents revenue generated from external customers. Inter-segment revenue is priced with reference to prices charged to external customers for similar orders. 24 GET Holdings Limited Interim Report 2018

27 10. SEGMENT REPORTING (continued) 10. (a) Segment results (continued) (a) Information regarding the Group s reportable segments from continuing operations for the six months ended 30 June 2018 is set out below. Software Business Securities Investment Business Six months ended 30 June 2018 Money Lending Business Corporate Management Solutions and I.T. Contract Services Business Others Consolidated HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) Revenue Revenue from external customers 43, ,334 5,939 69,438 Inter-segment revenue Reportable segment revenue 43, ,430 5,939 69,534 Reconciliation: Elimination of inter-segment revenue (96) Revenue 69,438 Results Segment results (146,354) (2,005) 23 (3,539) (1,521) (153,396) Reconciliation: Interest income 121 Unallocated income Rental income 498 Loss on disposal of a joint venture (1,144) Loss on deconsolidation of subsidiaries (3,454) Fair value loss on investment property (300) Unallocated expenses Corporate expenses (7,502) Loss from operations (165,177) Finance costs Share of loss of an associate (13,581) Share of loss of a joint venture (1,174) Loss before taxation (179,932) Income tax expense (2,752) Loss for the Period from continuing operations (182,684)

28 10. SEGMENT REPORTING (continued) 10. (a) Segment results (continued) (a) Software Business Securities Investment Business Six months ended 30 June 2018 Money Lending Business Corporate Management Solutions and I.T. Contract Services Business Others Consolidated HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) Other segment information: Amortisation of intangible assets (10,439) (789) (11,228) Depreciation (10) (118) (414) (542) Gain on disposal of financial assets at fair value through profit or loss Fair value loss on financial assets at fair value through profit or loss (2,167) (2,167) Impairment loss on amount due from deconsolidated subsidiaries (570) (570) Impairment loss on goodwill (Note 13(a)) 13(a) (163,000) (163,000) Legal and professional fees (17) (1,522) (1,539) Loss on deconsolidation of subsidiaries (3,454) (3,454) 26 GET Holdings Limited Interim Report 2018

29 10. SEGMENT REPORTING (continued) 10. (a) Segment results (continued) (a) Information regarding the Group s reportable segments from continuing operations for the six months ended 30 June 2017 is set out below. Software Business Securities Investment Business Six months ended 30 June 2017 Money Lending Business Corporate Management Solutions and I.T. Contract Services Business Others Consolidated HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) Revenue Revenue from external customers 56, ,619 8,842 99,754 Inter-segment revenue Reportable segment revenue 56, ,728 8,842 99,863 Reconciliation: Elimination of inter-segment revenue (109) Revenue 99,754 Results Segment results 28,339 (2,780) 538 2,348 1,967 30,412 Reconciliation: Interest income 4 Unallocated income Rental income 960 Other loan interest income 412 Fair value gain on contingent consideration receivable 25 Fair value loss on investment properties (4,608) Unallocated expenses Corporate expenses (8,655) Profit from operations 18,550 Finance costs (9,089) Share of profit of an associate 5,209 Profit before taxation 14,670 Income tax expense (5,324 ) Profit for the period from continuing operations 9,

30 10. SEGMENT REPORTING (continued) 10. (a) Segment results (continued) (a) Software Business Securities Investment Business Six months ended 30 June 2017 Money Lending Business Corporate Management Solutions and I.T. Contract Services Business Others Consolidated HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) Other segment information: Amortisation of intangible assets (10,135) (789) (10,924) Depreciation (30) (107) (806) (943) Loss on disposal of available-for-sale financial assets (2,775) (2,775) Gain on disposal of financial assets at fair value through profit or loss Fair value gain on financial assets at fair value through profit or loss Loss on disposal of property, plant and equipment (1) (1) Legal and professional fees (570) (36) (2) (2,278) (2,886) (b) Segment assets and liabilities (b) For the purpose of monitoring segment performances and allocating resources among segments: Segment assets include all tangible, intangible assets and current assets with the exception of other corporate assets. Segment liabilities include all current and noncurrent liabilities with the exception of accrued central administration costs, loan notes and convertible notes. 28 GET Holdings Limited Interim Report 2018

31 10. SEGMENT REPORTING (continued) 10. (b) Segment assets and liabilities (continued) (b) Information regarding the Group s reportable segments as at 30 June 2018 is set out below. Software Business Securities Investment Business 30 June 2018 Money Lending Business Corporate Management Solutions and I.T. Contract Services Business Others Consolidated HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) Assets Segment assets 232,737 51, ,858 2, ,704 Reconciliation: Unallocated assets Property, plant and equipment 144 Investment property 38,000 Investment in an associate 13,503 Trade and other receivables 48,175 Cash and cash equivalents 70,498 Total assets 516,024 Liabilities Segment liabilities 38, , ,483 Reconciliation: Unallocated liabilities Trade and other payables 1,815 Current tax liabilities 188 Total liabilities 55,486 Other segment information: Additions to property, plant and equipment (4) (4) Development costs capitalised (12,878) (12,878)

32 10. SEGMENT REPORTING (continued) 10. (b) Segment assets and liabilities (continued) (b) Information regarding the Group s reportable segments as at 31 December 2017 is set out below. Software Business Securities Investment Business 31 December 2017 Money Lending Business Corporate Management Solutions and I.T. Contract Services Business Others Consolidated HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) Assets Segment assets 410,170 47,358 12,775 57,313 11, ,553 Reconciliation: Unallocated assets Property, plant and equipment 190 Investment properties 38,300 Investments in associates 28,182 Investment in a joint venture 3,418 Trade and other receivables 48,474 Cash and cash equivalents 47,563 Total assets 705,680 Liabilities Segment liabilities 39, ,313 5,713 54,669 Reconciliation Unallocated liabilities Trade and other payables 2,178 Total liabilities 56,847 Other segment information: Additions to property, plant and equipment (354) (127) (481) Development costs capitalised (27,107) (27,107) 30 GET Holdings Limited Interim Report 2018

33 10. SEGMENT REPORTING (continued) 10. (c) Geographical information (c) The following tables set out information about the geographical location of (i) the Group s revenue from external customers and (ii) the Group s property, plant and equipment, investment properties, intangible assets and goodwill ( Specified non-current assets ). The geographical location of customers is based on the location at which the services were provided or the goods delivered. The geographical location of the Specified non-current assets is based on the physical location of the assets, in the case of property, plant and equipment and investment properties, and the location of the operation to which they are allocated, in the case of intangible assets and goodwill. (i)(ii) Three months ended 30 June Six months ended 30 June HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Continuing operations Revenue from external customers Hong Kong 12,256 17,309 25,302 38,029 United States of America 6,621 9,738 14,502 21,550 Russia 1,784 1,692 3,753 7,324 Germany 992 1,399 2,007 2,956 United Kingdom 1,027 1,473 2,271 3,299 Japan 1,657 1,676 3,561 3,389 Australia ,266 1,847 Canada ,973 1,766 Others (including Mainland China) 6,636 9,078 14,803 19,594 32,414 44,046 69,438 99, June 2018 HK$ 000 (Unaudited) 31 December 2017 HK$ 000 (Audited) Specified non-current assets Hong Kong 271, ,

34 10. SEGMENT REPORTING (continued) 10. (d) Information about major customers (d) and 30 June 2017, no individual customer contributed over 10% of total revenue from continuing operations of the Group. 10% 11. DIVIDENDS 11. The Board does not recommend the payment of any dividend for the Period (2017: HK$ nil). 12. INVESTMENT PROPERTIES 12. On 29 March 2016, the Group entered into a sale and purchase agreement with an independent third party to acquire additional 51% interest of Dragon Oriental Investment Limited ( Dragon Oriental ) at a cash consideration of HK$17,340,000. Completion of the acquisition took place on 31 March Immediately after completion of the acquisition, Dragon Oriental becomes an indirect wholly-owned subsidiary of the Company. Dragon Oriental is principally engaged in property investment and its principal asset is a property located in Hong Kong. The property is located at Shop F, Ground Floor, Yenfu Mansion, Nos , , 139 and 141, Hip Wo Street and Nos Shui Wo Street, Kowloon, Hong Kong. In accordance with HKFRS 3 (Revised) Business Combinations, this transaction is accounted as an asset acquisition. Details of the acquisition are set out in the Company s announcements dated 29 March 2016 and 31 March Dragon Oriental Investment Limited Dragon Oriental 51% 17,340,000 Dragon Oriental Dragon Oriental F 3 The investment property was revalued at 30 June 2018 on the market value basis by making reference to recent transactions of similar properties by an external independent valuer. 32 GET Holdings Limited Interim Report 2018

35 13. GOODWILL 13. Total HK$ 000 Cost At 1 January ,955 Arising on acquisition of a subsidiary 762 Derecognised on disposal of a subsidiary (865) At 31 December ,852 Derecognised on deconsolidation of subsidiaries (4,581) At 30 June ,271 Accumulated impairment losses At 1 January ,496 Impairment loss recognised 182,000 At 31 December ,496 Impairment loss recognised (Note 5/6(c)) 5/6(c) 163,000 At 30 June ,496 Carrying amount At 30 June ,775 At 31 December ,356 Impairment on goodwill In accordance with Hong Kong Accounting Standard 36, an impairment loss shall be recognised for the cash-generating unit ( CGU ) if the recoverable amount of the CGU is less than the carrying amount of the CGU. The Company should conduct goodwill impairment review annually or more frequently if events or changes in circumstances indicate a potential impairment. Subsequent to the publication of the first quarterly results of the Company for the three months ended 31 March 2018, the Board noted that the financial performance of the Software Business did not pick up as expected and has further declined. In view of the decrease in revenue from the Software Business of approximately HK$43.1 million for the Period as compared to that of approximately HK$56.8 million for the corresponding period in 2017, representing a decrease of approximately 24.2%, the Board considered that this may be an indicator of potential impairment on the carrying amount of the goodwill of Boom Max International Limited and its subsidiaries ( Boom Max Group ), the CGU of the Software Business. Accordingly, the Company appointed Ascent Partners Valuation Service Limited as independent valuer in assisting in the valuation of the CGU in relation to the Boom Max Group as at 30 June 2018 ( Valuation Date ) ,800,000 43,100, % Boom Max International Limited Boom Max Boom Max

36 13. GOODWILL (continued) 13. Impairment on goodwill (continued) During the Period, the Group recorded an impairment loss on goodwill (the Impairment Loss on Goodwill ) of approximately HK$163 million (2017: nil) in relation to the Boom Max Group. The Impairment Loss on Goodwill, which was non-cash in nature, did not affect the Group s working capital condition during the Period. Boom Max 163,000,000 Calculation of impairment loss As at 30 June 2018, the carrying amount of the Boom Max Group before impairment was approximately HK$521 million (31 December 2017: HK$521 million) which comprised (i) goodwill of approximately HK$288 million (31 December 2017: HK$288 million) attributable to the Group s % interest in the Boom Max Group; (ii) goodwill of approximately HK$154 million (31 December 2017: HK$154 million) attributable to the non-controlling interests in the Boom Max Group; and (iii) net operating assets of approximately HK$79 million (31 December 2017: HK$79 million) of the Boom Max Group. Boom Max 521,000, ,000,000 (i) Boom Max65.177% 288,000, ,000,000 (ii) Boom Max 154,000, ,000,000(iii) Boom Max 79,000,000 79,000,000 As at 30 June 2018, the recoverable amount of the Boom Max Group was approximately HK$271 million (31 December 2017: HK$584 million) (equivalent to approximately US$34.9 million (31 December 2017: US$75.3 million)), being an amount shown in the valuation report on the Boom Max Group as at 30 June 2018 prepared by the independent valuer, which was determined based on the value in use ( VIU ) using the valuation method of discounted cash flow. It requires estimates concerning future cash flows and associated discount rate and growth rate assumptions which are based on the management s expectation of future business performance and prospects of the Boom Max Group. Boom Max 271,000, ,000,000 34,900,000 75,300,000 Boom Max Boom Max The impairment loss on goodwill of 100% interest of the Boom Max Group of approximately HK$250 million for the Period reduces the carrying amount of the Boom Max Group from approximately HK$521 million as at 30 June 2018 to its recoverable amount of approximately HK$271 million as at 30 June After the allocation of impairment loss to non-controlling interests, the Group recognised the Impairment Loss on Goodwill of approximately HK$163 million in relation to the Boom Max Group for the Period with reference to its holding of % interest in the Boom Max Group. Boom Max100% 250,000,000 Boom Max 521,000, ,000,000 Boom Max %Boom Max 163,000, GET Holdings Limited Interim Report 2018

37 13. GOODWILL (continued) 13. Impairment on goodwill (continued) Key basis and assumptions adopted for projected cash flow of the Software Business The expected average sales growth rate during the forecast period from 2019 to 2023 ( Forecast Period ) in 2018 was approximately 5.51% while the expected average sales growth rate during the forecast period from 2018 to 2022 ( Previous Forecast Period ) in 2017 was approximately 13.77%. As a result of the declining financial performance and the decrease in the revenue of the Software Business for the Period by approximately 24.2% as compared to that for the corresponding period in 2017 due to various factors which included the slower-than-expected development pace in the Asian market, the volatility of the global economy, the keen market competition in the I.T. market, the decline in the demand for personal computers ( PCs ), the management of the Group revised the 5-year cash flow forecast of the Boom Max Group with reference to the actual financial results of the Boom Max Group for the Period and the projected financial results of the Boom Max Group for the six months ending 31 December 2018, which resulted in the decrease in the recoverable amount of the CGU of the Software Business. As a result, the projected average sales growth rate for the Forecast Period in 2018 was lower than the projection for the Previous Forecast Period made in % 13.77% 24.2%Boom Max Boom Max Boom Max There were no significant changes in the basis adopted in the preparation of the projected cash flow for the Forecast Period in 2018 as compared with those adopted for the Previous Forecast Period in 2017, except for the application of the declining revenue of the Boom Max Group in the Period as a base for the projected cash flow for the Forecast Period in The expected average sales growth rate during the Forecast Period was determined with reference to a research on software industry conducted on an international research platform for companies, industries and M&A deals analysis while similar approach was adopted for determining the expected average sales growth rate during the Previous Forecast Period in The expected annual gross profit margins and annual net profit margins during the Forecast Period in 2018 were predicted to be maintained at the historical levels in 2017 and 2018 given that the I.T. market and the global economy have not changed significantly. Boom Max

38 13. GOODWILL (continued) 13. Impairment on goodwill (continued) Key basis and assumptions adopted for projected cash flow of the Software Business (continued) The VIU of the CGU of the Software Business was developed through the application of the weighted-average-cost-of-capital ( WACC ) to discount the free cash flows to the CGU. The WACC was calculated by taking into account the cost of equity and the cost of debt. The cost of equity was calculated according to the Capital Asset Pricing Model. 30 June December 2017 Risk-free Rate 2.25% 1.83% Levered Beta Market Risk Premium 11.81% 12.56% Size Premium 5.59% 5.60% Cost of Equity 16.89% 19.52% 36 GET Holdings Limited Interim Report 2018

39 13. GOODWILL (continued) Impairment on goodwill (continued) Key basis and assumptions adopted for projected cash flow of the Software Business (continued) The 10-year Hong Kong Sovereign Bond Yield as at 30 June 2018, (i.e. the Valuation Date), was used as the risk-free rate of Hong Kong because government bonds are regarded as risk-free. This rate, as obtained from an international research database, was approximately 2.25% (31 December 2017: 1.83%). As the Company is listed on the Stock Exchange and the principal operating subsidiaries of the Boom Max Group are located in Hong Kong, reference was made to the Hang Seng Index annualised expected return when determining the expected market return of Hong Kong. The expected market return of Hong Kong, a forward-looking rate, was approximately 14.05% (31 December 2017: 14.39%). It is the annualised expected rate of return of Hong Kong equity market proxied as the market capitalisation weighted average of the expected internal rate of return of each company in the Hang Seng Index. The internal rate of return is derived by using the dividend discount model based on estimates from market consensus taking into account the dividend yield, growth rate and payout ratio by an international research database. Therefore, the market risk premium, which was the difference between the expected market return and the risk-free rate, was taken to be approximately 11.81% (31 December 2017: 12.56%) based on the rate quoted from an international research database. The market risk premium is the additional required return over the risk free rate when investing in equity market. A small company risk premium of 5.59% (31 December 2017: 5.60%), suggested by an international consulting firm based on its research and database, was applied to the relatively small size of the Boom Max Group. The small company risk premium can be added to cost of capital estimation models as an adjustment for the additional risk of smaller companies relative to large companies. The research done by the international consulting firm provides different size premiums for different companies with various range of market capitalisation. In the research, all companies on the New York Stock Exchange ( NYSE ) were ranked by the combined market capitalisation of their eligible equity securities. The companies were then split into 10 equally populated groups or deciles. Eligible companies traded on the NYSE and the Nasdaq National Market ( NASDAQ ) were then assigned to the appropriate deciles according to their capitalisation in relation to the NYSE breakpoints. The market capitalisation of the Boom Max Group falls within the smallest range stated in the research and the small company risk premium was accordingly applied. The small company risk premium was calculated over the years from 1926 to 2016 during which the actual return in excess of risk free rate minus the return in excess of risk free rate as predicted by Capital Asset Pricing Model. The levered beta of approximately (31 December 2017: 0.963) was derived from the average of unlevered beta of approximately (31 December 2017: 0.852) guideline public companies in similar industries % 1.83%Boom Max 14.05% 14.39% 11.81% 12.56% 5.59% 5.60% Boom Max Boom Max

40 13. GOODWILL (continued) 13. Impairment on goodwill (continued) Key basis and assumptions adopted for projected cash flow of the Software Business (continued) Unlevered Beta 30 June December 2017 Guideline Public Companies Absolute Software Corp Absolute Software Corp F-Secure OYJ F-Secure OYJ Trend Micro Inc Trend Micro Inc Advenica AB Advenica AB Check Point Software Technologies Ltd. Check Point Software Technologies Ltd Link Motion Inc. (NQ Mobile Inc. previous name) Link Motion Inc.NQ Mobile Inc Symantec Corporation Symantec Corporation Average of unlevered beta The levered beta is calculated by multiplying the unlevered beta to the multiple of (1 minus 16.50% of Hong Kong tax rate) and the ratio of debt to equity and then plus 1. As at the Valuation Date, the average debt to equity ratio of the comparable companies of approximately 11.82% (31 December 2017: 15.60%) was adopted as proxy to estimate the debt to equity ratio of the Boom Max Group. The amount of cost of debt adopted was 7.00% (31 December 2017: 7.00%) which was the sum of International Monetary Fund (IMF) Hong Kong lending rate as at the Valuation Date of 5.00% (31 December 2017: 5.00%) and an additional percentage of 2.00% (31 December 2017: 2.00%). International Monetary Fund (IMF) Hong Kong lending rate of 5.00% was Hong Kong prime lending rate that banks generally charged the most creditworthy clients as at the Valuation Date. An additional percentage of 2.00% was added to the cost of debt because of the credit risk for lending money to the Group. The WACC of the Boom Max Group as at 30 June 2018 was approximately 15.72% (31 December 2017: 17.67%). The terminal growth rate of approximately 3.08% (31 December 2017: 3.08%), which was the average of the inflation rates of Hong Kong from 2008 to 2017, was applied in the valuation as of the Valuation Date % % 15.60% Boom Max 7.00% 7.00%(IMF) 5.00%5.00% 2.00% 2.00%(IMF) 5.00% 2.00% Boom Max 15.72% 17.67% 3.08% 3.08% 38 GET Holdings Limited Interim Report 2018

41 13. GOODWILL (continued) Impairment on goodwill (continued) Key basis and assumptions adopted for projected cash flow of the Software Business (continued) There are no significant changes in the methodology and sources of market data applied in the valuation for the Period except for the market risk premium of approximately 11.81% as at 30 June 2018 dropped from approximately 12.56% as at 31 December Such change in the market risk premium led to a decrease in the WACC from approximately 17.67% as at 31 December 2017 to approximately 15.72% as at 30 June Companies satisfying the following criteria, are adopted as comparable companies for the valuation: (1) the comparable company is principally engaged in corporate management solutions and I.T. contract services related business; (2) the principal business of the comparable company is diversified geographically; (3) the shares of the comparable company are listed on major stock exchange and have been actively traded for a reasonable period of time; and (4) detailed financial and operational information in respect of the comparable company are publicly available. The valuation method of discounted cash flow was adopted for the calculation of the VIU of the CGU of the Software Business. In accordance with Hong Kong Accounting Standard 36 Impairment of Assets, a CGU to which goodwill has been allocated shall be tested for impairment annually, and whenever there is an indication that the CGU may be impaired, by comparing the carrying amount of the CGU, including the goodwill, with the recoverable amount of the CGU, which is the higher of the VIU and the fair value less costs of disposal. The valuation method of fair value less costs of disposal was not adopted as there were limited transactions of comparable CGU available in the market for the determination of fair value after having researched on an international research database, all announcements on the websites of the Stock Exchange, the Shenzhen Stock Exchange and the Shanghai Stock Exchange and the financial reports and publicly available information of listed companies in Hong Kong. In accordance with Hong Kong Accounting Standard 36, it will not be possible to measure fair value less costs of disposal because there is no reasonable basis for making a reliable estimate of the price at which an orderly transaction to sell the CGU would take place between market participants at the measurement date under the then prevailing current market condition. On the other hand, costs of disposal of transactions can be various on a case-by-case basis and such information is not easily assessable. As such, VIU was adopted as the recoverable amount of the CGU. The valuation method of discounted cash flow has been consistently applied in the valuation on the CGU of the Software Business since (i)avg Technologies (ii) 12.56% 11.81% 17.67% 15.72% (1) (2) (3) (4)

42 13. GOODWILL (continued) Impairment on goodwill (continued) Key basis and assumptions adopted for projected cash flow of the Software Business (continued) 13. The Company engaged Ascent Partners Valuation Service Limited, an independent valuer, as the valuer to perform the valuation on the CGU of the Software Business of the Group as at 31 December 2017 and 30 June FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME June 2018 HK$ 000 (Unaudited) 31 December 2017 HK$ 000 (Audited) Listed investments, at fair value Equity securities listed in Hong Kong 37,063 Unlisted equity securities ,205 Analysed as: Non-current assets 37,205 The fair values of listed equity securities traded in active market are based on current closing prices on the Stock Exchange. The fair value of listed equity securities which were suspended or halted in trading in an active market were estimated by using the index return method by an independent valuer which was consistent with method adopted as at 31 December These investments were classified as available-for-sale financial assets as at 31 December GET Holdings Limited Interim Report 2018

43 15. TRADE AND OTHER RECEIVABLES June 2018 HK$ 000 (Unaudited) 31 December 2017 HK$ 000 (Audited) Trade receivables (Note (b)) (b) 13,181 24,133 Less: Allowance for doubtful debt (Note (c)) (c) (60) (20) 13,121 24,113 Prepayments, deposits and other receivables (Note (d)) (d) 27,376 27,286 Amounts due from brokers Amounts due from non-controlling interests of a subsidiary (Note (e)) (e) Loan receivable from an associate (Note (f)) (f) 27,230 27,230 67,866 78,

44 15. TRADE AND OTHER RECEIVABLES (continued) 15. (a) Ageing analysis (a) According to the credit rating of different customers and service providers, the Group normally allows credit periods ranged from 0 to 90 days (31 December 2017: 0 to 90 days) to its trade customers and service providers The ageing analysis of the Group s trade receivables (net of allowance for impairment loss) based on due date is as follows: 30 June 2018 HK$ 000 (Unaudited) 31 December 2017 HK$ 000 (Audited) Not due 10,387 19,715 Less than 1 month past due 1 1,437 1,561 More than 1 month but less than 13 3 months past due 1,130 1,796 More than 3 months but less than months past due More than 12 months past due Amounts past due 2,734 4,398 13,121 24, GET Holdings Limited Interim Report 2018

45 15. TRADE AND OTHER RECEIVABLES (continued) 15. (b) Loan receivables (b) As of 30 June 2018, included in the Group s trade receivables were loans to customers of HK$nil (31 December 2017: approximately HK$6,177,000) for the Money Lending Business. 6,177,000 The detailed analysis of loan receivables is as follows: 30 June 2018 Secured Unsecured Total 31 December June December June December 2017 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Audited) (Unaudited) (Audited) (Unaudited) (Audited) Current 6,177 6,177 As at 31 December 2017, the loan receivables of approximately HK$6,177,000 were secured by the personal guarantees given 6,177,000 by a director of a former subsidiary of the Company. (c) Impairment (c) The Group applies the simplified approach permitted by HKFRS 9 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables. Impairment losses are recorded using an allowance account unless the Group is satisfied that recovery of the amount is remote, in which case the impairment loss is written off against trade and other receivables directly. (d) Other receivables (d) As of 30 June 2018, the Group s prepayments, deposits and other receivables included the contingent consideration receivables of HK$20,400,000 (31 December 2017: HK$20,400,000) arising from the profit guarantee for the 20,400,000 acquisition of AP Group Investment during the year ended 31 20,400,000 December

46 15. TRADE AND OTHER RECEIVABLES (continued) 15. (e) Amounts due from non-controlling interests of a subsidiary (e) The amounts due are unsecured, interest free and with no fixed repayment terms. (f) Loan receivables from an associate (f) The loan due from Jun Yang Energy Holdings Limited ( Jun Yang Energy ) is unsecured, interest free and is repayable upon demand subject to the consent of all shareholders of Jun Yang Energy. 16. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS June 2018 HK$ 000 (Unaudited) 31 December 2017 HK$ 000 (Audited) Equity securities held for trading, at fair value, listed in Hong Kong 6,310 9,656 Unlisted investment fund 156 Analysed as: Current assets 6,466 9,656 The investments represent listed equity securities investments that offer the Group the opportunity for return through dividend income and fair value gains. They have no fixed maturity or coupon rate. The fair values of listed securities were based on market prices at the end of reporting period. The fair value of listed equity securities which are suspended or halted in trading in an active market were estimated by using the index return method by an independent valuer. The fair value of the unlisted investment fund has been determined by reference to the latest quotation provided by the administrator of the investment fund on the reporting date. The directors believe that the estimated fair value provided by the administrator of the investment fund is reasonable, and that is the most appropriate value at the end of the reporting period. 44 GET Holdings Limited Interim Report 2018

47 16. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS (continued) 16. Financial assets at fair value through profit or loss are denominated in Hong Kong dollars. As a result of the adoption of the HKFRS 9, unlisted investment fund of approximately HK$156,000 which had been previously classified as available-for-sale financial assets was reclassified to financial assets at fair value through profit or loss on 1 January TRADE AND OTHER PAYABLES 9 156, June 2018 HK$ 000 (Unaudited) 31 December 2017 HK$ 000 (Audited) Trade payables 3,391 3,366 Deferred income 6,834 2,672 Amounts due to non-controlling interests of a subsidiary 971 Accrued expenses and other payables 6,560 10,712 16,785 17,721 The ageing analysis of trade payables, based on the date of receipt of goods/services, is as follows: 30 June 2018 HK$ 000 (Unaudited) 31 December 2017 HK$ 000 (Audited) Less than 3 months 3 3,347 3,316 More than 3 months but less than 12 months More than 12 months ,391 3,

48 18. DECONSOLIDATION OF SUBSIDIARIES 18. Due to the circumstances that the Group was unable to locate complete set of books and records of the AP Group ( Deconsolidated Subsidiaries ), in the opinion of the Board, the control over the Deconsolidated Subsidiaries was lost. Accordingly, the financial results, assets and liabilities of the Deconsolidated Subsidiaries have been deconsolidated from the condensed consolidated financial statements of the Group with effective from 1 April 2018 and the Group recorded a loss on deconsolidation of the Deconsolidated Subsidiaries of approximately HK$3,454,000 for the Period. 3,454,000 The following is the financial information, before intra-group balances and transactions elimination, of the Deconsolidated Subsidiaries. (a) Loss on deconsolidation of the Deconsolidated Subsidiaries (a) Net liabilities of AP Group at the date of deconsolidation were as follows: HK$ 000 (Unaudited) Property, plant and equipment 124 Trade and other receivables 1,599 Tax recoverable 267 Inventories 612 Cash and bank balances 409 Trade and other payables (4,865) Amount due to group companies (356) Non-controlling interests 1,083 Net liabilities of the Deconsolidated Subsidiaries (1,127) Goodwill 4,581 Loss on deconsolidation 3, GET Holdings Limited Interim Report 2018

49 18. DECONSOLIDATION OF SUBSIDIARIES (continued) 18. (b) Transactions of the Deconsolidated Subsidiaries included in the condensed consolidated statement of profit or loss of the Group for the three months ended 31 March 2018 (b) Deconsolidated Subsidiaries HK$ 000 (Unaudited) Revenue 3,112 Cost of sales (350) Other revenue and the other gains and losses, net 13 Administrative expenses (2,548) Income tax expense (12) Profit for the period SHARE CAPITAL 19. Nominal value per share Number of shares Amount HK$ 000 HK$ 000 Authorised: Ordinary shares At 1 January 2018 and 30 June 2018 (Unaudited) ,000, ,000 Issued and fully paid: Ordinary shares At 1 January 2018 and 30 June 2018 (Unaudited) ,448 4, RESERVES 20. The amounts of the Group s reserves and the movements therein for the Period and the same period of previous year are presented in the unaudited condensed consolidated statement of changes in equity

50 21. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS 21. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following disclosures of fair value measurements use a fair value hierarchy that categorises into three levels the inputs to valuation techniques used to measure fair value: Level 1 inputs: quoted prices (unadjusted) in active markets for identical assets or liabilities that the Group can access at the measurement date. Level 2 inputs: inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs: unobservable inputs for the asset or liability. The Group s policy is to recognise transfers into and transfers out of any of the three levels as of the date of the event or change in circumstances that caused the transfer. (a) Disclosures of level in fair value hierarchy at 30 June 2018 and 31 December 2017: (a) Fair value measurements using: Level 1 Level 2 Level 3 30 June 2018 DESCRIPTION HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Total Recurring fair value measurements: Financial assets Financial assets at fair value through profit or loss Listed equity securities 1,664 4,646 6,310 Unlisted investment fund Financial assets at fair value through other comprehensive income Listed equity securities 35,590 1,473 37,063 Unlisted equity securities Investment properties Commercial unit Hong Kong 38,000 38,000 Total 37,254 38,000 6,417 81, GET Holdings Limited Interim Report 2018

51 21. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS (continued) 21. (a) Disclosures of level in fair value hierarchy at 30 June 2018 and 31 December 2017: (continued) (a) Fair value measurements using: Level 1 Level 2 Level 3 31 December 2017 DESCRIPTION HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Audited) (Audited) (Audited) (Audited) Total Recurring fair value measurements: Financial assets Financial assets at fair value through profit or loss Listed equity securities 3,236 6,420 9,656 Available-for-sale financial assets Listed equity securities 35,216 1,635 36,851 Unlisted equity securities Unlisted investment fund Investment properties Commercial unit Hong Kong 38,300 38,300 Total 38,452 38,300 8,353 85,105 There were no transfers between levels 1, 2 and 3 during the Period. During the year ended 31 December 2017, two listed equity securities which were classified as financial assets at fair value through profit or loss and available-for-sale financial assets were transferred from measurement based on Level 1 to Level 3 as these listed equity securities were suspended or halted in trading on the Stock Exchange and the Group no longer possible to determine the fair value of these equity securities using quoted prices or observable market data

52 21. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS (continued) 21. (b) Reconciliation of assets measured at fair value based on level 3: (b) 30 June 2018 Financial assets Financial assets at fair value at fair value through other through profit or loss comprehensive income Listed equity securities Unlisted investment funds Listed equity securities Unlisted equity securities HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) At 1 January ,420 Adjustment on initial application of HKFRS , Restated balance at 1 January , , Total gains/(losses) recognised in profit or loss (#) (#) (1,774) in other comprehensive income (162) At 30 June , , GET Holdings Limited Interim Report 2018

53 21. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS (continued) 21. (b) Reconciliation of assets measured at fair value based on level 3: (continued) (b) 31 December 2017 Derivative financial instruments Financial assets at fair value through profit or loss Available-for-sale financial assets Contingent consideration receivables Listed equity securities Listed equity securities Unlisted equity securities Unlisted investment funds HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) At 1 January ,147 18,710 Purchases/additions 1,781 Transfer into Level 3 6,420 1,635 Transfer to other receivables (20,400) Total gains/(losses) recognised in profit or loss (#) (#) (959) 1,690 in other comprehensive income (1,639) (1,991) At 31 December ,420 1, (#) Included in other gains or losses (#) The total losses recognised in other comprehensive income are presented in fair value losses on financial assets at fair value through other comprehensive income (2017: available-forsale financial assets) in the unaudited condensed consolidated statement of profit or loss and other comprehensive income. The total gains/(losses) recognised in profit or loss including those for assets held at the end of reporting periods are presented in Other revenue and other gains and losses in the unaudited condensed consolidated statement of profit or loss

54 22. CAPITAL COMMITMENTS Capital commitments at the end of the reporting periods are as follows: June 2018 HK$ 000 (Unaudited) 31 December 2017 HK$ 000 (Audited) Contracted but not provided for: capital contribution to a joint venture 645 development cost for intangible assets 12,878 25,757 12,878 26, SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD 23. (a) AP Acquisition Litigation (a) Reference is made to the announcements of Company dated 13 June 2016, 23 June 2016 and 1 July 2016 in relation to, among other matters, the acquisition of 51% equity interest in AP Group Investment ( Acquisition ) and the announcements of the Company dated 12 June 2018, 26 June 2018 and 16 July 2018 in relation to the adjustment to consideration for the Acquisition. 51% On 13 June 2016, Lucky Famous Limited ( Lucky Famous ) ( Purchaser ), a wholly-owned subsidiary of the Company, entered into a sale and purchase agreement ( SP Agreement ) with Fragrant River Entertainment Culture (Holdings) Limited ( Vendor ) and Universe International Holdings Limited (now known as Universe International Financial Holdings Limited) ( Guarantor ), pursuant to which the Group conditionally agreed to acquire, and the Vendor conditionally agreed to sell 51% equity interest of AP Group Investment, at the consideration of HK$20,400,000, subject to downward adjustments as described below, which shall be settled by way of allotment and issue of 40,800,000 new ordinary shares of the Company, credited as fully paid, at the issue price of HK$0.50 per share to the Vendor (or its nominee), on the date of completion. The AP Group was principally engaged in the provision of self-improvement and selfenhancement training programmes in Hong Kong. Completion of the Acquisition took place on 1 July Lucky Famous Limited Lucky Famous 51% 20,400, ,800, GET Holdings Limited Interim Report 2018

55 23. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD (continued) 23. (a) AP Acquisition Litigation (continued) (a) In accordance with the terms and conditions of the SP Agreement, in the event that the audited consolidated profit after tax of AP Group Investment attributable to its owners from 1 January 2016 to 31 December 2017 ( FY 2016 & 2017 ) (which will only include income or gain generated by activities in the ordinary and usual course of business of the AP Group) ( FY 2016 & 2017 Net Profit ) is less than HK$16,000,000, the Vendor 16,000,000 shall, and the Guarantor shall procure the Vendor to, pay to the Purchaser (or to its order) an adjustment amount ( Adjustment Amount ) in cash within 14 days after the audited consolidated financial statements of AP Group Investment for FY2016 & 2017 ( FY2016 & 2017 Audited Accounts ) are available. The Adjustment Amount shall be determined in accordance with the formula set out below: A = HK$20,400,000 (NP/2) x 5 x 51% A = 20,400,000 (NP/2) x 5 x 51% Where: A means the amount of the Adjustment Amount in HK$; and A NP means the FY2016 & 2017 Net Profit. Where the FY2016 & NP 2017 Net Profit is a negative figure, NP shall be deemed to be zero. NP The FY2016 & 2017 Net Profit shall be based on the FY2016 & 2017 Audited Accounts which shall be prepared in accordance with the Hong Kong Financial Reporting Standards and audited, adjusted for any non-recurring items. Based on the FY2016 & 2017 Audited Accounts, the AP Group recorded a net loss of HK$189,799. In accordance with the SP 189,799 Agreement, the FY2016 & 2017 Net Profit of the AP Group shall be deemed to be zero. Accordingly, the Group has requested the Vendor and the Guarantor to pay the Adjustment Amount of HK$20,400,000 on or before 26 June 2018 according to the terms and conditions of the SP Agreement. On 22 June 2018, 20,400,000 the Group received a letter from the legal adviser acting for the Vendor and the Guarantor that they will defend the purported claim of the Group for the payment of the Adjustment Amount alleged by the Group

56 23. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD (continued) 23. (a) AP Acquisition Litigation (continued) (a) Up to 26 June 2018, i.e. the last date on which the Vendor and the Guarantor shall pay the Adjustment Account after the FY2016 & 2017 Audited Accounts were made available to them, the Group had not received any payment of the Adjustment Amount from any of the Vendor and the Guarantor. The Board considered that the Vendor and the Guarantor have potentially breached their contractual obligations by failing to repay the Group the Adjustment Amount in accordance with the terms and conditions of the SP Agreement. In order to safeguard the legitimate rights and interests of the Group, after seeking legal advice, the Group has commenced legal proceeding ( AP Acquisition Litigation ) against the Vendor as the 1st defendant and the Guarantor as the 2nd defendant. A writ of summons with an indorsement of claim were filed by Lucky Famous as plaintiff at the Court of First Instance of the High Court of Hong Kong on 16 July Based on the writ, the Group claimed against the Vendor and the Guarantor for (a) the Adjustment Amount of HK$20,400,000; (b) interests; (c) costs; and (d) further and/or other reliefs. Lucky Famous (a) 20,400,000(b)(c)(d) Details of the AP Acquisition Litigation are set out in the Company s announcements dated 12 June 2018, 26 June 2018 and 16 July (b) AP Management Litigation (b) On 26 July 2018, the Company as the 1st plaintiff and AP Group Investment as the 2nd plaintiff, issued a writ of summons in the High Court of Hong Kong against Mr. Chan Sze Long (i.e. 1st Defendant) as the 1st defendant and Ms. Lim Wah Elsa (i.e. 2nd Defendant) as the 2nd defendant for the matters as detailed below ( AP Management Litigation ). The 1st Defendant and the 2nd Defendant are former directors of AP Group Investment until their respective resignations on 18 July The 1st Defendant and/or his controlled company, and the controlled company of the 2nd Defendant, are also former directors of the other members of the AP Group at all material times. 54 GET Holdings Limited Interim Report 2018

57 23. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD (continued) 23. (b) AP Management Litigation (continued) (b) The Company is a majority shareholder holding 51% interest Lucky Famous in AP Group Investment through its wholly-owned subsidiary, 51% Lucky Famous. As a result of the 51% shareholding in AP Group 51% Investment, all members of the AP Group are subsidiaries of the Company and their financial results have been consolidated into the Group s consolidated financial statements prior to the deconsolidation of the AP Group becoming effective on 1 April The AP Group was principally engaged in the provision of education and training programs in relation to self-improvement and self-enhancement in Hong Kong at all material times. At all material times and during the tenure of office of the Defendants as directors of AP Group Investment, in reliance of the experience and expertise of the Defendants in running the AP Group, it was agreed by the parties that the Defendants were wholly responsible for the efficient and proper management and operation of the AP Group, including but not limited to, the efficient daily operations of the AP Group, keeping proper books and records of the AP Group at all times for inspection by 15 the Group and the provision of weekly cash and bank balance reports, annual budget and monthly financial reports of AP Group Investment including that of all the other members of the AP Group to the Company within 15 days after each month s end. After the resignations of the Defendants as directors of AP Group Investment on 18 July 2018 and up to the date of this report, the Defendants failed to deliver up all the accounting books and financial records of, and all businesses records in connection with, the running of the AP Group, including but not limited to records in relation to the students records, instructors records and information on potential litigations, for the period of seven years immediately prior to the date of their resignations as director of AP Group Investment on 18 July 2018 ( Full Business Records ) to the Group

58 23. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD (continued) 23. (b) AP Management Litigation (continued) (b) In order to safeguard the legitimate rights and interests of the Group, after seeking legal advice, the Group has commenced legal proceeding against the Defendants. The Group claimed against the Defendants for the reliefs, including but not limited to, delivering up of the Full Business Records, accounting for the assets of the AP Group for the period from 1 April 2018 to 18 July 2018 that were in the power, possession or control of the Defendants and damages to be assessed. Details of the AP Management Litigation are set out in the Company s announcement dated 27 July (c) Perfect Growth Litigation (c) On 3 July 2018, Perfect Growth Limited ( Perfect Growth ), a wholly-owned subsidiary of the Company, received an amended writ of summons ( Amended Writ ) with an amended statement of claim ( Amended Statement of Claim ) issued in the Court of First Instance of the High Court of Hong Kong by Convoy Global Holdings Limited ( 1st Plaintiff ), Convoy Collateral Limited ( 2nd Plaintiff ) and CSL Securities Limited ( 3rd Plaintiff ) (1st Plaintiff, 2nd Plaintiff and 3rd Plaintiff collectively referred to as the Plaintiffs ) against, among other defendants, Perfect Growth as one of the defendants ( Perfect Growth Litigation ). Perfect Growth was joined as one of the defendants by way of the Amended Writ. Pursuant to the Amended Statement of Claim attached to the Amended Writ, Perfect Growth is named as one of the Alleged Independent Placees (being placees of the placing of shares of the 1st Plaintiff carried out in around October 2015 ( October 2015 Placing )) and has been allotted with some of the Wrongfully Allotted Shares (being shares of the 1st Plaintiff allotted in the October 2015 Placing). 56 GET Holdings Limited Interim Report 2018

59 23. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD (continued) 23. (c) Perfect Growth Litigation (continued) (c) Pursuant to the Amended Writ, the reliefs claimed by the Plaintiffs against Perfect Growth are as follows: (1) the 1st Plaintiff seeks a declaration and an order as (1) against, among others, Perfect Growth, that the allotment of the Wrongfully Allotted Shares by the 1st Plaintiff to, among others, Perfect Growth is null and void, or has been rescinded and be set aside; (2) the 1st Plaintiff seeks an account of profits and an order (2) for payment of any sums found to be due, equitable compensation to be assessed and/or damages to be assessed for dishonest assistance, unlawful means conspiracy and/or lawful means conspiracy as against, among others, Perfect Growth, in relation to, among other matters, the October 2015 Placing and the allotment of the Wrongfully Allotted Shares; and (3) the Plaintiffs seek as against, among others, Perfect (3) Growth (a) general or special damages; (b) interests; (c) (a)(b) costs; (d) further and/or other reliefs. (c)(d) Details of Perfect Growth Litigation are set out in the Company s announcement dated 5 July COMPARATIVE FIGURES 24. Certain comparative figures have been reclassified and/or re-presented to conform with the current period s presentation

60 MANAGEMENT DISCUSSION AND ANALYSIS BUSINESS REVIEW Continuing Operations Software Business During the Period, the Group s Software Business recorded a revenue of approximately HK$43,115,000 (2017: approximately HK$56,844,000), representing a decrease of approximately 24.2% as compared to that of the corresponding period in This business segment also recorded a change from a segment profit of approximately HK$28,339,000 for the six months ended 30 June 2017 to a segment loss of approximately HK$146,354,000 for the same period in 2018, including the Impairment Loss on Goodwill of approximately HK$163,000,000 (2017: nil) in relation to the CGU of the Software Business. Details of the Impairment Loss on Goodwill are set out in note 13 to the condensed consolidated financial statements. The macroenvironment also had a key role to play in the performance of the Software Business. In the first half of 2018, the volatility and uncertainties of global economy doubled, including the U.S. Federal Reserve s two interest rate hikes, the outbreak of Sino-US trade wars, and the political instability in Europe. Such volatility and uncertainties carried the global economy into smoggy atmosphere, which not only slowed down the pace of recovery in the Euro-zone countries, but also shaked the business environment of China and other countries in Asia. In addition, the continued global downtrend in demand for personal computers ( PC ) as well as the escalating competition in the I.T. market resulted in a decrease in the sales volume of the Software Business. Taking all aforementioned into conclusion, the Group s continuous weak performance of the Software Business was mainly due to the growth of business expansion in the emerging markets failing to meet expectation, coupled with the decline of sales in the traditional market like the Europe and the U.S.. 43,115,000 56,844, % 28,339, ,354, ,000, In recent years, the cyber world is engulfed in a quiet revolution, with growing popularity of Artificial Intelligence ( AI ) technologies re-defining the order of the cyberspace. With various electronic devices, such as PC, mobile and tablet, extensively penetrating every part of people s daily life and work, humans and the cyber world are never as closely tied together. Boom Max International Limited ( Boom Max ) and its subsidiaries (collectively known as Boom Max Group ) has continuously paid close attention to the development trend of the I.T. market, developed the core software business and accelerated research and development ( R&D ) process to plug the security breaches in a bid to defend the user s network security. During the Period, the Boom Max Group endeavoured to launch updates on optimisation software namely Advanced SystemCare, optimisation and anti-virus software namely Advanced SystemCare Ultimate, mobile optimisation and protection software namely Advanced Mobile Care Security and random password software namely Random Password Generator in an effort to step up to pervasive internet security threats across the board. In addition, the Boom Max Group launched a new version of the anti-hacker software namely IObit Malware Fighter 6 during the Period. At the same time, computer users and fans of computer games have more and more discerning requirements. Such needs for smooth and quality experience are met by the Boom Max Group s softwares, including the automatic PC driver updater namely Driver Booster, the automatic hard disk defrag software namely Smart Defrag, and MAC system cleaning and maintenance software namely MacBooster. Boom Max International Limited Boom Max Boom Max Boom Max Advanced SystemCare Advanced SystemCare Ultimate Advanced Mobile Care Security Random Password Generator Boom Max IObit Malware Fighter 6 Boom Max Driver BoosterSmart Defrag MACMacBooster 58 GET Holdings Limited Interim Report 2018

61 MANAGEMENT DISCUSSION AND ANALYSIS All aforementioned softwares are now available for users worldwide at or other software downloading directory websites and affiliate websites. Dedicated to building and reinforcing distribution channels, the Boom Max Group has been extending its distribution and sales channels from the U.S. and Europe to Asian markets, building distribution channels in countries along the Belt and Road like the Philippines, Myanmar and Thailand and selling software products through distribution channels of local dealers and affiliates. To attract users in Asian regions to download and use its products, in April 2018, the Boom Max Group has launched product websites in Hindi, Malay and Bahasa Indonesia to tap the huge demand of the emerging markets. However, while the European and American Markets have been greatly affected by the downtrend of global economy, the growth in the emerging markets was also not as good as expected. The overall performance of this segment was not satisfactory. Boom Max Boom Max As at 30 June 2018, according to Boom Max Group s internal sales data, Boom Max Group s products had more than 29 million users in total, including new non-paying and active paying users (users who had subscribed the product for at least once during the Period) (2017: over 28 million). Boom Max Boom Max 29,000,000 28,000,000 Over the years, the Boom Max Group has amassed profound hands-on experience in network security, groomed a professional and creative R&D team, built a mature and diversified software business system and established cross-border and effective marketing channels. Looking ahead, the Boom Max Group will keep abreast of the information technology development trend, proactively explore new technological application realm and seek a sustainable development mode. Boom Max Boom Max Corporate Management Solutions and I.T. Contract Services Business The Group provides corporate management solutions, I.T. contract services, network infrastructure solutions, network professional services and I.T. project implementation services to corporate clients mainly in Hong Kong through its indirect wholly-owned subsidiaries e-perfect IT Limited and Wafer Systems (Hong Kong) Limited. During the Period, revenue derived from this business segment was approximately HK$20,334,000 (2017: approximately HK$33,619,000), decreased by approximately 39.5% as compared to that of the same period last year. This business segment result also recorded a change from a segment profit of approximately HK$2,348,000 for the six months ended 30 June 2017 to a segment loss of approximately HK$3,539,000 for the Period. The plunge was primarily attributable to the completion of some sizeable contract projects in 2017 and the increasing competition in the I.T. market. The Group shall keep enhancing its competitiveness, boosting its technological capability, maintaining its service quality standards, and actively bidding for government and corporate contract projects, so as to overcome adversity and challenges in the industry. 20,334,00033,619, % 2,348,000 3,539,

62 MANAGEMENT DISCUSSION AND ANALYSIS Money Lending Business Citi Profit Finance Limited, an indirect wholly-owned subsidiary of the Group, holds a money lender licence granted under the Money Lenders Ordinance (Chapter 163 of the Laws of Hong Kong). The Group has in place a money lending policy and a procedural manual, both of which serve as a guidance in handling and/or monitoring money lending procedures in accordance with the Money Lenders Ordinance. In light of all sorts of instabilities lurking in the global economy and the potential risks of the Money Lending Business, after careful consideration, the Board has circumspectly decided to suspend operation of the Money Lending Business with effect from 11 May The Money Lending Business recorded an interest income of approximately HK$50,000 for the Period (2017: approximately HK$449,000), representing a decrease of approximately 88.9% as compared with that of the same period in During the Period, the Money Lending Business recorded a profit of approximately HK$23,000 (2017: approximately HK$538,000), representing a drop of approximately 95.7% as compared to that of the same period in The decline was mainly attributable to scale-down of the business. As at 30 June 2018, the Group did not have any loan receivables. During the Period, the Group did not record any doubtful or bad debt in relation to the Money Lending Business. Securities Investment Business As stated in the 2017 annual report of the Company, in view of the volatile financial market in Hong Kong, the business segment carries material price risk in its nature. As further reported in the 2018 first quarterly report of the Company, due to the escalating trade conflicts between the U.S. and China which brought all sorts of instabilities to the stock market and the potential price risk of this business segment, the Board, after careful consideration, decided to suspend operation of the Securities Investment Business with effect from 11 May 2018, and will, taking into account market situations, seek to dispose of assets entailed in the business in due course. During the Period, the Securities Investment Business recorded a segment loss of approximately HK$2,005,000 (2017: loss of approximately HK$2,780,000), representing a decrease of approximately 27.9% as compared with that of the corresponding period in Such loss was mainly attributable to the reduced returns from the Group s securities investment in the volatile financial market. As at 30 June 2018, the financial assets at fair value through profit or loss ( FVTPL Financial Assets ) and FVTOCI Financial Assets of the Group of fair value of approximately HK$6,466,000 (as at 31 December 2017: approximately HK$9,656,000) and approximately HK$37,205,000 (as at 31 December 2017: AFS Financial Assets of approximately HK$37,149,000) respectively consisted of eight investment items (2017: nine items), of which six are shares listed on the Stock Exchange, one is shares of an unlisted company and the remaining one is an unlisted investment fund , , % 23,000538, % 2,005,000 2,780, % 6,466,000 9,656,000 37,205,000 37,149, GET Holdings Limited Interim Report 2018

63 MANAGEMENT DISCUSSION AND ANALYSIS Below are the securities investments held by the Group as at 30 June 2018: Name of investee company Notes Place of incorporation Number of shares held by the Group Percentage of total issued share capital of the investee company as at 30 June 2018 Fair value as at 30 June 2018 Percentage to the Group s net assets as at 30 June 2018 Percentage to the Group s total assets as at 30 June 2018 Unrealised gain/(loss) on change in fair value for the Period Dividend income for the Period (Note 1) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) 1) (HK$ 000) (HK$ 000) (HK$ 000) (Approximately) (Approximately) (Approximately) (Approximately) (Approximately) FVTOCI Financial Assets China Parenting Network Holdings Limited ( China Parenting ) 2 Cayman Islands 450, % % 0.03% (2,174) Convoy Global Holdings Limited ( Convoy Global ) 3 Cayman Islands 13,512, % 1, % 0.29% (162) Target Insurance (Holdings) Limited ( Target Insurance ) 4 Hong Kong 3,500, % 3, % 0.65% (1,715) 175 Finsoft Financial Investment Holdings Limited ( Finsoft ) 5 Cayman Islands 186,492, % 32, % 6.22% 8,393 GET Mdream 6 Hong Kong 167, % % 0.028% FVTPL Financial Assets Convoy Global 3 Cayman Islands 10, % % % Hydra Capital SPC SP#1 ( Hydra Capital SPC ) 7 Cayman Islands 1, % % 0.03% Hydra Capital SPC SP#1 Hydra Capital SPC First Credit Finance Group Limited ( First Credit ) 8 Bermuda 84,460, % 4, % 0.90% (1,774) CK Hutchison Holdings Limited ( CK Hutchison ) 9 Cayman Islands 20, % 1, % 0.32% (298)

64 MANAGEMENT DISCUSSION AND ANALYSIS Notes 1. The percentages were calculated taking reference of the then latest monthly return or next day disclosure of return of the investee companies publicly available on the website of the Stock Exchange (where applicable) China Parenting (stock code: 8361) and its subsidiaries (collectively referred to as the China Parenting Group ) operate an online platform focusing on the Children-Babies-Maternity market in the People s Republic of China (the PRC or China ) and are mainly engaged in the provision of marketing and promotional services and e-commerce business. As disclosed in the annual report of China Parenting for the year ended 31 December 2017 published on 2 April 2018, for the year ended 31 December 2017, the revenue of the China Parenting Group was approximately RMB91.1 million (2016: RMB84.9 million), representing an increase of approximately 7.3% compared to that of last year. The China Parenting Group recorded a net profit of approximately RMB37.9 million for the year ended 31 December 2017 (2016: net profit of approximately RMB42.0 million), representing a decrease of approximately 9.8% compared to that of last year. As stated in the first quarterly report of China Parenting for the three months ended 31 March 2018, China Parenting Group will continue to position itself as a smart family lifestyle service provider and expand the types of family services so as to meet the long tail demands of the increasingly expanded CBM group. On 27 April 2018, China Parenting Group resubmitted the application for transfer of listing to the Main Board of the Stock Exchange pursuant to Chapter 9A of the Rules Governing the Listing of Securities on the Stock Exchange and the definitive timetable for the transfer of listing has yet to be finalized % % 9A 3. Convoy Global (stock code: 1019) and its subsidiaries (collectively referred to as the Convoy Group ) primarily engage in independent financial advisory business, money lending business, proprietary investment business, assets management business, corporate finance business and securities dealing business. Based on the annual report of Convoy Global for the year ended 31 December 2016 published on 27 April 2017, the Convoy Group s revenue for the year ended 31 December 2016 was approximately HK$1,205.1 million (2015: HK$604.6 million), representing an increase of approximately 99.3%. The Convoy Group recorded a net loss of approximately HK$104.2 million for the year ended 31 December 2016 (2015: net loss of approximately HK$484.1 million), representing a decrease of approximately 78.5% as compared to that of last year. As disclosed in the interim report of Convoy Global for the six months ended 30 June 2017, to pursue the vision of becoming one of the leading financial groups in Asia, it had set out three short-term missions: (i) to establish a comprehensive financial service platform in Asia, with special focus on Hong Kong and Mainland China; (ii) to realise synergies among its different business segments and regions of operation; and (iii) to improve the effectiveness of its capital structure. As disclosed in the profit warning announcement of Convoy Global dated 19 March 2018, Convoy Group expected to record substantial loss for the year ended 31 December 2017, approximately eight times the loss for the year ended 31 December At the request of Convoy Global, trading in its shares on the Stock Exchange was halted since 7 December , % % (i) (ii) (iii) 62 GET Holdings Limited Interim Report 2018

65 MANAGEMENT DISCUSSION AND ANALYSIS 4. Target Insurance (stock code: 6161) and its subsidiaries (collectively referred to as the Target Insurance Group ) principally engage in the writing of motor and other general insurance business in Hong Kong. As disclosed in the annual report of Target Insurance for the year ended 31 December 2017 published on 19 April 2018, the Target Insurance Group recorded the net insurance premium revenue of approximately HK$361.6 million for the year ended 31 December 2017 (2016: HK$345.3 million), representing an increase of approximately 4.7% as compared to that of last year. The net profit of the Target Insurance Group for the year ended 31 December 2017 was approximately HK$20.1 million (2016: net loss of approximately HK$5.0 million). As disclosed in the annual report of Target Insurance for the year ended 31 December 2017, Target Insurance Group will continue to direct effort towards development of business covering other types of motor vehicles. In addition to having online business platforms for private cars and commercial vehicles, allowing it to reach out to customers directly, Target Insurance Group will also explore different distribution channels to grow its car insurance business. Target Insurance Group has been active in forming alliances with business partners to provide all-round services to customers and extend reach to target customers. The company has a dedicated customer service team which can promptly respond to all customer enquiries and provide better customer experience % Finsoft (stock code: 8018) and its subsidiaries (collectively referred to as the Finsoft Group ) principally engage in the businesses of provision of financial trading software solutions and other internet financial platforms, referral services, money lending, assets investments and provision of corporate finance advisory services. Based on the annual report of Finsoft for the year ended 31 December 2017 published on 29 March 2018, the Finsoft Group recorded the revenue from its continuing operations of approximately HK$56.9 million for the year ended 31 December 2017 (2016: HK$58.5 million), representing a decrease of 2.8% as compared to that of last year. The net loss of the Finsoft Group from its continuing operations for the year ended 31 December 2017 reached approximately HK$54.4 million, which has substantially increased as compared to a net loss of approximately HK$10.4 million for last year. As disclosed in the interim results announcement of Finsoft for the six months ended 30 June 2018, Finsoft Group will strive to further strengthen its business in the provision of financial trading software solutions and devote more financial resources to its money lending business and aim for a better revenue growth, and will continue to strive for excellence in its products and services, in order to maintain its international competitiveness and enhance its growth potential in the fintech industry % GET Mdream is an unlisted company, which was incorporated and registered in Hong Kong. GET Mdream is a member of the Professional Insurance Brokers Association and a registered MPF Intermediary of Mandatory Provident Fund Schemes Authority. It principally engages in long term (including investment linked long term) insurance and general insurance lines of business and also MPF scheme brokerage business in Hong Kong. As disclosed in the annual report of GET Mdream for the year ended 31 December 2017, the GET Mdream recorded the revenue for the year ended 31 December 2017 of approximately HK$73.0 million (2016: approximately HK$69.5 million), representing an increase of approximately 5.0% as compared to that of last year. The net loss of GET Mdream for the year ended 31 December 2017 amounted to approximately HK$4.0 million (2016: net profit of approximately HK$1.2 million). As disclosed in the GET Mdream s booklet published in July 2017, the company upholds the spirit of putting customers first and creating value and strives to develop new business in the hope of building triple-win for customers, the company and colleagues in the next decade %

66 MANAGEMENT DISCUSSION AND ANALYSIS 7. Hydra Capital SPC is an unlisted investment fund, which was incorporated in the Cayman Island and registered as a segregated portfolio company permitted to implement its investment strategy, and its investment portfolio included certain online games. Referring to the newsletter of Hydra Capital SPC dated 3 February 2017, Hydra Capital SPC held 20.2% interests in Something Big Technology Holdings Limited, which is a company carrying on the business to publish selfdeveloped games, games licensed from third-party game distributors and/ or developers in the PRC as well as overseas locations including Hong Kong, Taiwan, Malaysia, Singapore, Japan and Republic of Korea. The revenue and net loss for the year ended 31 December 2017 of Hydra Capital SPC was RMB16.5 million and RMB16.8 million respectively, representing a decrease of 74.1% and an increase of 123% compared to those of last year. As disclosed in the Hydra Capital SPC newsletter dated 29 March 2018, Hydra Capital SPC plans to dispose of its investment and distribute available proceeds to its investors and be wound up after all accrued liabilities are settled. 8. First Credit (stock code: 8215) and its subsidiaries (collectively referred to as the First Credit Group ) engage mainly in money lending business. Based on the annual report of First Credit for the year ended 31 December 2017 published on 28 March 2018, the First Credit s revenue for the year ended 31 December 2017 was approximately HK$116.2 million (2016: HK$81.6 million), representing an increase of approximately 42.4%. The Convoy Group recorded a net profit of approximately HK$52.9 million for the year ended 31 December 2017 (2016: HK$33.6 million), representing an increase of approximately 57.2% as compared to that of last year. As disclosed in the interim results announcement of First Credit for the six months ended 30 June 2018, the First Credit Group will continue to strive for maintaining revenue growth and credit quality on the basis of its experience in money lending business. In consideration of the potential development of the securities market, the First Credit Group will consider exploring the possibility of other securities related business apart from the provision of securities brokerage services. Meanwhile, the First Credit Group will closely monitor its capital base and ensure sufficient funding is maintained through various means to capture and support different potential opportunities. At the direction of the Securities and Futures Commission, the Stock Exchange had suspended all dealings in the shares of First Credit with effect from 24 November 2017 under Rule 8(1) of the Securities and Futures (Stock Market Listing) Rules (Chapter 571V of the Laws of Hong Kong). 9. CK Hutchison (stock code: 1) and its subsidiaries (collectively referred to as the CK Hutchison Group ) operate five core businesses: ports and related services, retail, infrastructure, energy, and telecommunications. As disclosed in the annual report of CK Hutchison for the year ended 31 December 2017 published on 6 April 2018, the revenue of the CK Hutchison Group was approximately HK$248,515 million (2016: HK$259,842 million), representing a decrease of approximately 4.4% compared to that of last year. The CK Hutchison Group recorded a net profit of approximately HK$43,602 million for the year ended 31 December 2017 (2016: net profit of approximately HK$41,912 million), representing an increase of approximately 4.0% compared to that of last year. As disclosed in the interim results announcement of CK Hutchison for the six months ended 30 June 2018, building on its strong foundations of business and geographic diversification, CK Hutchison Group will continue to follow the fundamental objectives of achieving strong earnings and cash flow growth without compromising financial stability and strength. CK Hutchison Group will remain its core disciplines and strategic directions for prudent capital management on all investment activities, strict financial management, as well as a healthy liquidity and debt profile which supports its current investment grade ratings. 7. Hydra Capital SPC Hydra Capital SPC Hydra Capital SPCSomething Big Technology Holdings Limited 20.2% Hydra Capital SPC % 123%Hydra Capital SPC Hydra Capital SPC % % 571V 8(1) ,515259, % 43,602 41, % 64 GET Holdings Limited Interim Report 2018

67 MANAGEMENT DISCUSSION AND ANALYSIS Investment in Jun Yang Energy In 2016, Lucky Famous Limited (a wholly-owned subsidiary of the Company) acquired approximately 35% of the issued share capital of Jun Yang Energy at an aggregate cash consideration of HK$40,290,000. On 24 February 2017, the Group entered into a shareholder loan agreement in relation to the provision of a loan in the principal amount of US$3,500,000 (equivalent to approximately HK$27,230,000) to Jun Yang Energy. The loan was unsecured, non-interest bearing and repayable upon demand, subject to the consent of all shareholders of Jun Yang Energy. The loan was in proportion to the Group s shareholding in Jun Yang Energy when compared with those made by the other shareholders of Jun Yang Energy. Details of this shareholder loan agreement are set out in the Company s announcement dated 24 February Lucky Famous Limited 40,290,00035% 3,500,000 27,230,000 Jun Yang Energy and its subsidiaries (collectively Jun Yang Energy Group ) are principally engaged in solar energy business with a focus on development, construction, operation and maintenance of power station projects in China. During the Period, the Group recorded a share of loss of an associate of approximately HK$13,581,000 from the investment in Jun Yang Energy (2017: share of profit of an associate from the investment in Jun Yang Energy of approximately HK$5,209,000). Such loss was mainly attributable to the drop in gross profit and an increase in operating expenses and an impairment loss on the subsidies receivables from the China government. Such impairment was caused by the uncertainty in the collection time of the subsidies receivables of certain solar power stations. The liquidity of the business of Jun Yang Energy Group has recently become a pressing issue for the Board as the China government had delayed the payment of subsidies to the Jun Yang Energy Group. The management of Jun Yang Energy will continue to keep a close watch on the situation and development. 13,581,000 5,209,000 On 31 May 2018, the National Development and Reform Commission and the Ministry of Finance and National Energy Administration jointly released the Notice on matters relevant to photovoltaic power generation in 2018, which states that construction of general solar power stations will be suspended in 2018 and development of distributed solar power generation projects will be subject to standardised management. Also, guide pole on-grid power tariffs as well as subsidies to the solar power industry have been lowered. Thus, in the short term, the solar power industry supply chain will face difficult times with shrinking demand and narrowing profit. In view of the plight of delayed payment of subsidies by the PRC government to the solar power companies including Jun Yang Energy Group, the management of Jun Yang Energy will continue to keep a close watch on the situation and development and go to great lengths to solve the liquidity issue. In the long term, the industry will go through a new round of consolidation in favour of the stronger players and those less competitive players with weaker transforming and financial capability will be acquired or ousted. The management of Jun Yang Energy will watch closely on policy direction and any changes in situation and respond by adopting measures which are in line with its own pace of development

68 MANAGEMENT DISCUSSION AND ANALYSIS FINANCIAL REVIEW Revenue During the Period, the revenue of the Group s continuing operations was approximately HK$69,438,000, representing a decrease of approximately 30.4% as compared to the revenue of approximately HK$99,754,000 for the six months ended 30 June The revenue from continuing operations of the Group for the Period was mainly contributed by the revenue of (i) Software Business of approximately HK$43,115,000; (ii) Corporate Management Solutions and I.T. Contract Services Business of approximately HK$20,334,000; and (iii) other operating segments of approximately HK$5,939, ,438,000 99,754, % (i) 43,115,000(ii) 20,334,000(iii) 5,939,000 Gross Profit The gross profit from continuing operations of the Group for the Period decreased by approximately 29.9% from approximately HK$61,854,000 for the six months ended 30 June 2017 to approximately HK$43,390,000 for the Period. 61,854, % 43,390,000 Finance Costs The finance costs incurred from continuing operations of the Group decreased from approximately HK$9,089,000 for the six months ended 30 June 2017 to nil for the Period. 9,089,000 Loss for the Period The Group recorded a loss of approximately HK$182,684,000 from continuing and discontinued operations for the Period (2017: profit of approximately HK$12,469,000). The loss for the Period was primarily attributable to (i) the segment loss of the Software Business of approximately HK$146,354,000 (2017: profit of approximately HK$28,339,000), including the Impairment Loss on Goodwill of approximately HK$163,000,000 (2017: HK$Nil) for the Period; (ii) the share of loss of an associate of the Company of approximately HK$13,581,000 for the Period (2017: share of profit of an associate of approximately HK$5,209,000); (iii) the segment loss of the Corporate Management Solutions and I.T. Contract Services Business of approximately HK$3,539,000 for the Period (2017: profit of approximately HK$2,348,000); and (iv) the loss on deconsolidation of the Deconsolidated Subsidiaries of approximately HK$3,454,000 (2017: nil) for the Period. 182,684,00012,469,000 (i) 146,354,00028,339, ,000,000 (ii)13,581,000 5,209,000 (iii) 3,539,0002,348,000 (iv) 3,454,000 The loss attributable to owners of the Company was approximately HK$186,667,000 for the Period as compared with the profit attributable to owners of the Company of approximately HK$2,980,000 for the corresponding period in ,667,000 2,980, GET Holdings Limited Interim Report 2018

69 MANAGEMENT DISCUSSION AND ANALYSIS Liquidity, financial resources and capital structure As at 30 June 2018, the Group s cash and cash equivalents and pledged bank deposit amounted to approximately HK$115,743,000 (31 December 2017: approximately HK$104,193,000), which were principally denominated in United States dollars and Hong Kong dollars (2017: Renminbi, United States dollars and Hong Kong dollars). During the Period, the Group generally financed its operations with internally generated resources. There was no significant change in the capital structure of the Company during the Period. 115,743, ,193,000 Gearing Ratio As at 30 June 2018, the Group had total assets amounting to approximately HK$516,024,000 (31 December 2017: approximately HK$705,680,000) and total liabilities of approximately HK$55,486,000 (31 December 2017: approximately HK$56,847,000). The gearing ratio of the Group, calculated as total liabilities over total assets, was approximately 10.8% as at 30 June 2018 (31 December 2017: approximately 8.1%). 516,024, ,680,00055,486,000 56,847, % 8.1% Dividend The Board does not recommend any payment of dividend for the Period (2017: nil). Charges on the Group s Assets As at 30 June 2018, the Group pledged bank deposits of approximately US$80,000 and HK$1,009,000 (in aggregate equivalent to approximately HK$1,633,000) (31 December 2017: approximately US$80,000, HK$1,016,000 and HK$1,008,000 (in aggregate equivalent to approximately HK$2,645,000)) for securing banking facilities of HK$1,500,000 (31 December 2017: HK$2,500,000). The bank deposits were denominated in United States dollars with a term of six months and Hong Kong dollars with a term of 30 days and at fixed interest rates of 0.2% per annum and 0.5% per annum respectively. 80,0001,009,0001,633,000 80,0001,016,000 1,008,0002,645,000 1,500,0002,500, As at 30 June 2018, the Group had undrawn secured and unsecured banking facilities of approximately HK$1,846,000 (31 December 2017: approximately HK$2,908,000). 1,846,000 2,908,000 As at 30 June 2018 and 31 December 2017, the Group did not hold any margin trading account

70 MANAGEMENT DISCUSSION AND ANALYSIS RISK FACTORS Foreign Exchange Exposure During the Period, business activities of the Group were mainly denominated in Hong Kong dollars and United States dollars. The United States dollar is the main currency for transactions made by the Group. Since the Hong Kong dollar remains pegged to the United States dollar within a defined range, the Group is not exposed to any significant foreign exchange risk against the United States dollar and therefore has not entered into any foreign exchange contract as hedging measures. The Directors did not consider the Group as being significantly exposed to any foreign currency exchange risk. Notwithstanding the above, the Group manages its foreign currency risk against other currencies by closely monitoring the movement of foreign currency rates and may use hedging derivatives, such as foreign currency forward contracts, to manage its foreign currency risk as appropriate. Financial Risk The total assets of the Group of approximately HK$516,024,000 as at 30 June 2018 mainly included FVTOCI Financial Assets of approximately HK$37,205,000, FVTPL Financial Assets of approximately HK$6,466,000, goodwill of approximately HK$150,775,000 and intangible assets of approximately HK$81,427,000. The Group s FVTOCI Financial Assets and FVTPL Financial Assets are measured at fair value at the end of each reporting period. Therefore, the Group is exposed to equity security price risk due to fluctuation of the fair value of FVTOCI Financial Assets and FVTPL Financial Assets. The Directors regularly review exposure of the Group s FVTOCI Financial Assets and FVTPL Financial Assets to equity security price risk. Moreover, the Directors closely monitor the financial performance and operation of cash-generating units containing goodwill and intangible assets, and conduct impairment review on goodwill and intangible assets annually and more frequently should there be any unforeseeable events or changes in circumstances pointing to potential impairment. 516,024,000 37,205,000 6,466, ,775,000 81,427,000 Operation Risk The Group is exposed to the corresponding operation risks in each of its business divisions. To manage those risks, the management of each business division is responsible for monitoring the operation of their respective divisions and assessing related operation risks. They are responsible for implementing the Group s risk management policies and procedures and shall report any irregularities in connection with operation of projects to the Directors and seek direction. 68 GET Holdings Limited Interim Report 2018

71 MANAGEMENT DISCUSSION AND ANALYSIS Credit Risk To minimise credit risk, the Directors closely monitor the overall level of credit exposure and the management is responsible for determining credit approvals and monitoring the implementation of collection procedure to ensure follow-up actions are taken to recover overdue debts. In addition, the Group reviews the recoverable amount of each individual trade debt at the end of a reporting period to ensure adequate impairment losses are made for irrecoverable amounts. LITIGATIONS As at the date of this report, the Group was involved in three civil legal proceedings, namely, the AP Acquisition Litigation, the AP Management Litigation and the Perfect Growth Litigation. The details of the above litigations are set out in note 23 to the condensed consolidated financial statements. 23 TREASURY POLICY The Group adopts a conservative treasury policy. Treasury activities are centralised and the Group normally invests in portfolios comprising diverse products. It has guidelines in place to monitor and control investment risk exposure and capital management. The Board closely reviews the Group s liquidity position to ensure the liquidity structure of the assets, liabilities and other commitments of the Group can meet funding requirements at all times. UPDATES ON MATERIAL ASSET IMPAIRMENT During the Period, the Group recorded the Impairment Loss on Goodwill in relation to the Software Business. Details of the Impairment Loss on Goodwill are set out in the note 13(a) to the condensed consolidated financial statements. 13(a) UPDATES ON RESULTS OF PERFORMANCE GUARANTEE Details of results of performance guarantee in relation to the acquisition of 51% equity interest in AP Group Investment are set out in the note 23(a) to the condensed consolidated financial statements. MATERIAL TRANSACTION The Group did not make any material acquisition or disposal during the Period. 51% 23(a)

72 MANAGEMENT DISCUSSION AND ANALYSIS MANDATORY CONDITIONAL CASH OFFERS Reference is made to the announcement jointly issued by the Company and Mr. Wong Jing Shong ( Offeror ) dated 13 June 2018 ( Joint Announcement ) in relation to, among others, the mandatory conditional cash offers to acquire all the issued shares of the Company (other than those already owned or agreed to be acquired by the Offeror and parties acting in concert with him) and to cancel all the outstanding share options of the Company ( Offers ). Unless otherwise specified herein, capitalised terms used in this paragraph shall have the same meanings as those defined in the Joint Announcement. On 6 June 2018, the Company was informed by the Offeror that the Offeror had on 6 June 2018 purchased 3,600,000 Shares at prices ranging from HK$0.415 to HK$0.420 per Share from open market ( Purchase ). Immediately prior to the Purchase, the Offeror was interested in 130,680,000 Shares, representing approximately 29.40% of the issued share capital of the Company. Upon completion of the Purchase on 6 June 2018 and as at 30 June 2018, the Offeror held 134,280,000 Shares, representing approximately 30.21% of the voting rights of the Company. Pursuant to Rule 26.1 of the Takeovers Code, the Purchase triggered the obligation of the Offeror to make a mandatory conditional cash offer for all issued Shares (other than those already owned or agreed to be acquired by the Offeror and parties acting in concert with him). Pursuant to Rule 13.5 of the Takeovers Code, the Option Offer should also be made to cancel all the outstanding Share Options. The Share Offer Price for each Offer Share is HK$0.42 while the Option Offer Price for the cancellation of each outstanding Share Option is HK$ ,600, ,680, % 134,280, % As disclosed in the Joint Announcement, there were outstanding Share Options carrying rights to subscribe for 1,246,386 new Shares. Pursuant to the terms and conditions of the Shares Options, all the outstanding Share Options were exercisable until 14 July 2018 and have lapsed thereafter automatically (to the extent not already exercised). As at the date of this report, the Company has no other outstanding Share Options and the Company has no intention to grant any share options before the close of the Offers. Accordingly, it is not necessary for the Offeror to make the Option Offer and Get Nice Securities, for and on behalf of the Offeror, will continue to make the mandatory conditional cash offer to acquire all issued Shares in the share capital of the Company (other than those already owned or agreed to be acquired by the Offeror and parties acting in concert with him) pursuant to Rule 26.1 of the Takeovers Code. As at the date of this report, the relevant securities (as defined in Note 4 to Rule 22 of the Takeovers Code) of the Company comprised 444,448,237 Shares in issue. 1,246, ,448, GET Holdings Limited Interim Report 2018

73 MANAGEMENT DISCUSSION AND ANALYSIS In compliance with Rule 2.1 of the Takeovers Code, the Board has set up the Independent Board Committee, comprising all independent non-executive Directors, namely Mr. Chan Yung, Mr. Cheng Hong Kei, Professor Chui Tsan Kit, Professor Lee T.S. and Ms. Xiao Yiming, to advise the Independent Shareholders in respect of the Share Offer. Veda Capital has been appointed as the financial adviser to advise the Company in respect of the Share Offer. Veda Capital is a corporation licensed to carry on Type 6 (advising on corporate finance) regulated activity under the SFO. Hooray Capital Limited, a corporation licensed to carry on Type 6 (advising on corporate finance) regulated activity under the SFO, has been appointed as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the Share Offer and, in particular, on as to whether the Share Offer is fair and reasonable and as to acceptance of the Share Offer As at the date of this report, the Company and the Offeror are still in the process of finalising the information in the Composite Document and the same will be published in accordance with the requirements of the Takeovers Code and the GEM Listing Rules as and when appropriate. Details of the mandatory conditional cash offers are set out in the Company s announcements dated 13 June 2018, 19 June 2018, 4 July 2018, 6 August 2018 and 9 August GEM Employees and remuneration policies As at 30 June 2018, the Group had approximately 76 employees (31 December 2017: 95 employees) in Hong Kong. Its remuneration policy emphasises equality, motivation and performance, and the principle of helping it strengthen competitiveness in the market in order to comply with statutory requirements of the respective jurisdictions where the employees are stationed. Remuneration packages are normally reviewed annually. Apart from salary payments, other staff benefits include provident fund contributions, medical insurance coverage and performance-related bonuses. The Group also has a share option scheme in place to reward and motivate employees. Details of the share option scheme of the Company are set out in the section Other Information Share Option Scheme in this report Contingent liabilities As at 30 June 2018, the Group did not have any significant contingent liabilities (31 December 2017: nil). Capital commitments As at 30 June 2018, the capital commitments contracted but not provided for the development costs of intangible assets and capital contribution to a joint venture were approximately HK$12,878,000 (31 December 2017: approximately HK$26,402,000). Please refer to note 22 to the unaudited condensed consolidated financial statements for details. 12,878,000 26,402,

74 MANAGEMENT DISCUSSION AND ANALYSIS OUTLOOK In the cyber world, security threats have been a continuous concern. New industries using AI technologies are emerging, and viruses and attack methods adopted by hackers come up incessantly with the evolving technological advancement. The phenomena creates a large unmet security gap which represents huge future development opportunities for the Group. Riding the evolving I.T. industry tide, the Group will actively develop and improve its diverse PC performance optimisation and anti-virus softwares, increase the variety of the products of the Software Business, focus on developing new technologies and exploring brand new realms, as well as nurture potential business drivers. Furthermore, capitalising on China s Belt and Road strategy, the Group will strive to let the Software Business go global to reach countries such as the Philippines, Myanmar and Thailand along the Belt and Road, as well as expand its marketing coverage to emerging markets in the Asia-Pacific region. The Group will also continue to consolidate and expand its software product sales channels in the European countries and the U.S. in the hope of enhancing its profitability in the long run. Other than giving major attention to the Software Business, the Group will also continue to pursue business diversification, assess at appropriate time the gain and growth prospects of different business segments, allocate resources flexibly to business segments with high operational efficiency and sustainable development. The Group will capitalise on its strong business foundation and extensive business scope to actively explore suitable investment opportunities, so as to generate more lucrative investment returns for shareholders of the Company ( Shareholders ). 72 GET Holdings Limited Interim Report 2018

75 OTHER INFORMATION DEALINGS FOR SECURITIES TRANSACTIONS BY DIRECTORS The Company has adopted Rules 5.48 to 5.67 of the GEM Listing Rules as the required standard of dealings in respect to any dealings in the Company s securities by the Directors. Specific enquiries have been made to all Directors and they all confirmed they had complied with the said GEM Listing Rules during the Period. DIRECTORS INTERESTS IN CONTRACTS OR ARRANGEMENTS GEM GEM None of the Directors or an entity connected with a Director is or was materially interested, whether directly or indirectly, in any transaction, arrangement or contract of significance subsisting during or at the end of the Period which is significant in relation to the business of the Group, nor had any Director had direct or indirect interests in any assets which have been acquired or disposed of by or leased to, or are proposed to be acquired or disposed of by or leased to, any member of the Group at the end of the Period or at any time during the Period. DIRECTORS AND CHIEF EXECUTIVE S INTERESTS OR SHORT POSITIONS IN THE SHARES, UNDERLYING SHARES OR DEBENTURES OF THE COMPANY OR ANY ASSOCIATED CORPORATIONS As at 30 June 2018, the interests or short positions of the Directors and the chief executive of the Company in the shares, underlying shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the Securities and Futures Ordinance ( SFO ) (Chapter 571 of the Laws of Hong Kong) as recorded in the register required to be kept under section 352 of the SFO, or otherwise notified to the Company and the Stock Exchange pursuant to the required standard of dealings by Directors as referred to in Rule 5.46 of the GEM Listing Rules, were as follows: 571 XV 352 GEM

76 OTHER INFORMATION Long positions in the ordinary shares ( Shares ) of the Company and underlying Shares Approximate percentage of the total issued Name of Director Capacity Number of underlying Shares held share capital of the Company (Note 1) 1 Lee Kin Fai ( Mr. Lee ) Beneficial owner 623,193 (Note 2) % Notes: 1. The total number of 444,448,237 Shares in issue as at 30 June 2018 has been used for the calculation of the approximate percentage ,448, Based on the Director s/chief Executive s Notice Interests in Shares of Listed Corporation filed by Mr. Lee dated 20 February 2017, these 623,193 underlying Shares had an exercise period from 15 July 2015 to 14 July 2018 with an exercise price of HK$2.721 per Share , Save as disclosed above, as at 30 June 2018, none of the Directors nor chief executive of the Company had or was deemed to have any interests or short positions in the shares, underlying shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) as recorded in the register required to be kept under section 352 of the SFO, or otherwise notified to the Company and the Stock Exchange pursuant to the required standard of dealings by Directors as referred to in Rule 5.46 of the GEM Listing Rules. XV 352 GEM5.46 DIRECTORS AND CHIEF EXECUTIVE S RIGHTS TO ACQUIRE SHARES OR DEBT SECURITIES Save as disclosed in the sections headed Directors and Chief Executive s Interests or Short Positions in the Shares, Underlying Shares or Debentures of the Company or any Associated Corporations and Share Option Scheme in this report, at no time during the Period was the Company or any of its subsidiaries a party to any arrangements to enable the Directors and the chief executive, their respective spouses or children under the age of 18 to acquire benefits by means of acquisition of shares in or debentures of the Company or any other body corporate GET Holdings Limited Interim Report 2018

77 OTHER INFORMATION SHARE OPTION SCHEME The share option scheme ( 2007 Share Option Scheme ) of the Company adopted pursuant to a shareholders resolution of the Company passed on 24 December 2007 has been terminated on 13 June A new share option scheme ( Share Option Scheme ) was approved by the Shareholders in the annual general meeting of the Company on 13 June 2017 and adopted on 15 June Upon termination of the 2007 Share Option Scheme, no further options shall be granted pursuant to the 2007 Share Option Scheme but the scheme shall in all other respects remain in force to the extent necessary to give effect to the exercise of any outstanding options granted prior to its termination. Any existing options shall continue to be valid and exercisable in accordance with the terms and conditions of the 2007 Share Option Scheme. The Share Option Scheme is to enable the Company to grant options to the eligible participants as incentives or rewards for their contribution to the Group and/or to enable the Group to recruit and retain high-calibre employees and attract human resources that are valuable to the Group and any entities in which any member of the Group holds equity interest. The Directors may subject to the provisions of the Share Option Scheme and the GEM Listing Rules, invite any person belonging to any of the following classes of eligible participants, to take up share options to subscribe for Shares: (a) any eligible employee (whether full time or part time, including any executive Director but excluding any non-executive Director) of the Company, any of its subsidiaries or any entity in which any member of the Group holds any equity interest ( invested entity ); (b) any non-executive Director (including independent non-executive Directors) of the Company, any of its subsidiaries or any invested entity; and (c) any adviser (professional or otherwise) or consultant to any area of business or business development of any member of the Group or any invested entity. GEM (a) (b) (c) The Share Option Scheme shall continue in force for a period of 10 years commencing on its adoption date. The Share Option Scheme will remain in force until 15 June 2027 and after such date no further options shall be offered but the provisions of the Share Option Scheme shall remain in full force and effect to the extent necessary to give effect to the exercise of any options granted before its expiry or termination but not yet exercised. The maximum number of Shares which may be allotted and issued upon exercise of all options to be granted at any time under the Share Option Scheme and any other share option schemes of the Group must not in aggregate exceed 10% of the issued Shares on the date of Shareholders approval of the Share Option Scheme or the date of Shareholders approval of a refreshment of such limit in a general meeting of the Company ( General Scheme Limit ). Previously granted options which may be outstanding, cancelled, lapsed or exercised will not be counted for the purpose of calculating the General Scheme Limit. 10%

78 OTHER INFORMATION The limit on the number of Shares which may be allotted and issued upon exercise of all outstanding options granted and yet to be exercised under the Share Option Scheme and any other share option schemes of the Group (including the 2007 Share Option Scheme) must not in aggregate exceed 30% of the total Shares in issue from time to time. 30% Each grant of options under the Share Option Scheme to any Director, chief executive of the Company or substantial Shareholder (as defined in the GEM Listing Rules) or any of their respective associates must be approved by independent non-executive Directors (excluding independent non-executive Director who or whose associate is the proposed grantee). Where any grant of options to a substantial Shareholder (as defined in the GEM Listing Rules) or an independent non-executive Director, or any of their respective associates, would result in the Shares issued and to be issued upon exercise of all options already granted and to be granted (including options exercised, cancelled and outstanding) to such person in the 12-month period up to and including the date of such grant: (a) representing in aggregate over 0.1% of the Shares in issue; and (b) having an aggregate value, based on the closing price of the Shares as at the date of each grant, in excess of HK$5,000,000, such further grant of options must be approved by the Shareholders in general meeting. GEM GEM (a)0.1%(b) 5,000,000 Upon acceptance of an option granted under the Share Option Scheme, the eligible participant shall pay HK$1.00 to the Company as consideration for the grant. Such option will be offered for acceptance within such time specified in the offer which shall not be later than 21 days from the date on which the offer is made The total number of Shares issued and to be issued upon exercise of the options granted under the Share Option Scheme and any other share option schemes of the Group (including exercised and outstanding options) to each participant in any 12-month period shall not exceed 1% of the Shares in issue. The exercise price for the options granted under the Share Option Scheme shall be determined at the discretion of the Board but in any event shall be at least the highest of: (i) the closing price of the Shares as stated in the daily quotations sheet of the Stock Exchange on the date of grant, which must be a business day; (ii) the average closing price of the Shares as stated in the daily quotations sheets of the Stock Exchange for the five business days immediately preceding the date of grant; and (iii) the nominal value of the Share. 12 1% (i) (ii) (iii) 76 GET Holdings Limited Interim Report 2018

79 OTHER INFORMATION Details of the movements in the options granted under the 2007 Share Option Scheme and the Share Option Scheme during the Period are as follows: Cancelled/ Outstanding Granted Exercised lapsed/ Outstanding Exercise price as at during during forfeited during as at Date of grant Grantees Exercise period per Share 1 January 2018 the Period the Period the Period 30 June 2018 HK$ 2 July 2015 Mr. Lee 15 July 2015 to 14 July , ,193 2 July 2015 the company secretary and the financial controller of the Company and a director of a subsidiary of the Company 15 July 2015 to 14 July , ,193 Total 1,246,386 1,246,386 Notes: 1. The vesting period of the options is from the date of grant until the commencement of the exercise period As at 30 June 2018, the number of Shares of 1,246,386 that may be issued upon full exercise of the then outstanding share options represented approximately 0.3% of the then total issued share capital of the Company, and did not have a material dilutive impact on the issued Shares, the respective shareholdings of the substantial Shareholders and earnings per Share on that date. 2. 1,246, % Details of the options granted by the Company under the 2007 Share Option Scheme have been disclosed in the Company s announcement dated 2 July As at the date of this report, all outstanding share options had lapsed. As at 30 June 2018 and the date of this report, the total number of Shares available for issue under the Share Option Scheme was 44,444,823, representing approximately 10% of the issued share capital of the Company as at the date of this report. 44,444,823 10%

80 OTHER INFORMATION INTERESTS DISCLOSEABLE UNDER THE SFO AND SUBSTANTIAL SHAREHOLDERS AND OTHER PERSONS INTEREST IN SECURITIES Substantial Shareholders As at 30 June 2018, the following persons (other than Directors or the chief executive of the Company) had, or were deemed or taken to have interests or short positions in the Shares or underlying Shares which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO or, which were recorded in the register required to be kept by the Company under Section 336 of the SFO: Long positions in the ordinary Shares XV Name Capacity Approximate percentage of the total issued Number of Shares interested share capital of the Company (Note 1) (Note 2) Notes 1 2 Ace Source International Limited ( Ace Source ) Ace Source International Limited Ace Source Beneficial owner 30,131,060 (L) 6.78% 3 Xue Qiushi ( Mr. Xue ) Interest of a controlled corporation 30,131,060 (L) 6.78% 3 Wong Jing Shong Beneficial owner 134,280,000 (L) 30.21% 78 GET Holdings Limited Interim Report 2018

81 OTHER INFORMATION Notes: 1. L denotes a long position. 1. L 2. The total number of 444,448,237 shares of the Company in issue as at 30 June 2018 has been used for the calculation of the approximate percentage ,448, Ace Source was interested in 30,131,060 Shares in the capacity of beneficial owner. Ace Source is wholly and beneficially owned by Mr. Xue. As such, Mr. Xue was deemed to be interested in all the Shares held by Ace Source pursuant to Part XV of the SFO. Mr. Xue is a director of Ace Source and certain subsidiaries of the Company. 3. Ace Source30,131,060 Ace Source XVAce Source Ace Source Save as disclosed above, the Directors were not aware of any other person (other than Directors or chief executive of the Company) who, as at 30 June 2018, had or was deemed or taken to have interests or short positions in the Shares or underlying Shares, which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO or, which were recorded in the register required to be kept by the Company under Section 336 of the SFO. XV PURCHASE, SALE OR REDEMPTION OF SHARES Neither the Company, nor any of its subsidiaries had purchased, sold or redeemed any of the Company s listed securities during the Period. COMPETING INTEREST None of the Directors, nor their respective close associates (as defined under the GEM Listing Rules) had any interest in a business, apart from the business of the Group, which competes or is likely to compete, either directly or indirectly, with the business of the Group during the Period. GEM CORPORATE GOVERNANCE Under code provision A.2.1 of the Corporate Governance Code as set out in Appendix 15 to the GEM Listing Rules, the roles of chairman and chief executive officer should be separate and should not be performed by the same individual. Since the former chairman of the Board, Mr. Kuang Hao Kun Giovanni, resigned on 31 March 2017, Ms. Hung Yvonne ( Ms. Hung ), the then chief executive officer of the Company ( Chief Executive Officer ) and executive Director, was appointed as the acting chairman of the Board and had temporarily taken up the responsibilities as the chairman of the Board for a transitional period while the Company might identify a suitable candidate. GEM A

82 OTHER INFORMATION On 12 June 2018, Ms. Hung retired as an executive Director and ceased to be the acting chairman of the Board at the annual general meeting of the Company and resigned as the Chief Executive Officer. Mr. Pon Kai Choi Phemey, an executive Director, has been appointed as the chairman of the Board in place of Ms. Hung on the same day. The Company is actively looking for suitable candidate to take up the role of the Chief Executive Officer. Save as disclosed above, during the Period, the Company has complied with the code provisions set out in Appendix 15 to the GEM Listing Rules. GEM AUDIT COMMITTEE The Company established the audit committee of the Board ( Audit Committee ) with written terms of reference in accordance with Rules 5.28 to 5.33 of the GEM Listing Rules. The Audit Committee s principal duties are to review and supervise the financial reporting process, risk management and internal control procedures of the Group. The Audit Committee currently comprises four independent non-executive Directors, namely, Mr. Cheng Hong Kei (the chairman of the Audit Committee), Mr. Chan Yung, Ms. Xiao Yiming and Professor Chui Tsan Kit. The Audit Committee meets at least quarterly each year. The Group s unaudited consolidated results for the Period have been reviewed by the Audit Committee. GEM On behalf of the Board GET Holdings Limited Pon Kai Choi Phemey Chairman and Executive Director 13 August 2018 As at the date of this report, the Board consists of three executive Directors, namely Mr. Pon Kai Choi Phemey, Mr. Lee Kin Fai and Mr. Wong Hin Shek; and five independent non-executive Directors, namely Mr. Chan Yung, Mr. Cheng Hong Kei, Professor Chui Tsan Kit, Professor Lee T. S. and Ms. Xiao Yiming. 80 GET Holdings Limited Interim Report 2018