ITE : Quarterly Results Announcement for the Nine Months Ended 31 December 2016

ITE (HOLDINGS) LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 8092) QUARTERLY RESULTS ANNOUNCEMENT FOR THE NINE MONTHS ENDED 31 DECEMBER 2016 CHARACTERISTICS OF THE GROWTH ENTERPRISE MARKET ("GEM") OF THE STOCK EXCHANGE OF HONG KONG LIMITED (THE "STOCK EXCHANGE") GEM has been positioned as a market designed to accommodate companies to which a high 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. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors. Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board and no assurance is given that there will be a liquid market in the securities traded on GEM.

The Hong Kong Exchanges and Clearing Limited and the Stock Exchange take no responsibility for the contents of this announcement, 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 this announcement.

This announcement, for which the directors (the "directors") of ITE (Holdings) Limited (the "company") collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on the GEM (the "GEM Listing Rules") of the Stock Exchange 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 the information contained in this announcement is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this announcement misleading.

HIGHLIGHTS

Turnover of the group for the nine months ended 31 December 2016 was approximately HK$14,704,000 representing a decrease of approximately 20% over the turnover of approximately HK$18,481,000 for the same period in 2015.

Loss attributable to owners of the company for the nine months ended 31 December 2016 amounted to approximately HK$1,184,000 compared to that of profit attributable to owners of the company approximately HK$320,000 for the same period in 2015.

The directors do not recommend the payment of an interim dividend for the nine months ended 31 December 2016 (nine months ended 31 December 2015: HK$nil).

CHAIRMAN'S STATEMENT

Dear Shareholders,

On behalf of the board (the "board") of directors (the "directors"), I hereby present the unaudited consolidated quarterly results of ITE (Holdings) Limited (the "company") and its subsidiaries (together, "ITE" or the "group") for the nine months ended 31 December 2016 (the "period").

Mission

The mission of the group is to become the leading provider of smartcard, radio frequency identification ("RFID"), biometrics product and solution and professional services in the world. ITE has been pioneering and has achieved outstanding performance in the areas of smartcard system solutions and integration services in the Hong Kong Special Administrative Region ("Hong Kong" or "HKSAR"), the Macao Special Administrative Region ("Macao") and the People's Republic of China ("PRC"). With profound expertise, strong research and development ("R&D") capability, proven track record and excellent reputation, the group has established a leading profile in our industry and has adopted a proactive approach to introduce innovative and customized smartcard, RFID and biometrics applications to our clients. Leveraging on our extensive industry experience and intellectual assets, ITE will continue to develop innovative products and multi-applications solutions for clients coming from different industries and to expand our businesses to more overseas countries.

Appreciation

I would like to take this opportunity to express my deepest thanks to my directors, management and staff for their dedication and hard work, and shareholders, financiers and business partners for their continued support.

Hong Kong, 8 February 2017

By order of the Board ITE (Holdings) Limited Lau Hon Kwong, Vincent Chairman

BUSINESS REVIEW

The Management of the group has continued to utilize our professional and committed workforce and financial resources to achieve maximum return to our shareholders.

During the period, we were very pleased to announce that our innovative product, HOMAC SPM-10A Smart ePayment Meter, was awarded with a Certificate of Merit in the 2016 Hong Kong Awards for Industries.

HOMAC SPM-10A has been designed and developed to meet the requirements and needs of Smart City development. Leveraging on our extensive industry knowledge and intellectual assets, we successfully developed and launched this intelligent Smart ePayment Meter product which is the first of its kind and the most advanced one in the world. It supports the latest financial payment technologies and related applications for now and the coming decades. Many intellectual property rights and assets have been created and protected during the development of this innovative product, they include patents, software and firmware copyrights, registered design and service trademarks.

HOMAC SPM-10A Smart ePayment Meter incorporates the latest technologies from 'FinTech' (Financial Technology), 'IoT' (Internet of Things), 'RFID' (Radio Frequency Identification), 'Sensor' and 'Sustainability and Green'.It supports RFID technologies of ISO14443 and Near Field Communication ("NFC") and all contactless FinTech stored value payment facilities (smart cards and smart devices). For contactless smart card, it supports Octopus, Visa payWave, MasterCard Contactless, UnionPay QuickPass and MacauPass. For smart phones and devices, it supports through NFC interfaces for Apple Pay, Samsung Pay and Android Pay. It can also support internet payment schemes' settlement through wireless connectivity of smart devices using Bluetooth/Wi-Fi/3/4G networks. The wireless connectivity allows remote supervisory control and data acquisition of thousands of meters installed across cities and country. It is an 'Internet of Things' approach.

Sophisticated sensor technologies for light, temperature/humidity and tilt/vibration are used to monitor, protect and manage the Smart ePayment Meter. HOMAC SPM-10A has been built with artificial intelligence to communicate and function with each other through ZigBee/Bluetooth. It can operate as a standalone off-grid smart city product which requires no live power source. Intelligent battery management system was also developed and tested for the use of the most advanced lithium battery cells in the world. It carries high energy density battery packs to support unattended remote usage for months. To support the IoT and "Track and Trace" requirements, HOMAC SPM-10A is equipped with Global Positioning System feature which provides real time location data to the central management system.

The new parking meter system trial of the Transport Department HKSAR has successfully started in Yuen Long and Mong Kok since October 2016. Twenty sets of HOMAC SPM-10A were delivered and commissioned to assess the new features and functions. We are very pleased to bring the trial to life.

During the period, we were awarded with new contracts for the supply and delivery of hardware, software and related professional services for the electronic payment and information technology infrastructures of electric vehicle DC fast charging stations of two local utility companies. The systems support the use of Octopus Card for spot payment or direct debit of electricity bill of user. More than ten ePayment kiosks will be delivered and integrated with the latest DC fast charging stations supplied by our technology partners. The DC fast charging stations are all equipped with CHAdeMO and Combined Charging Standard interfaces to support all local electric vehicle models like Nissan Leaf, BMW i3, Volkswagen e-Golf and Tesla.

We also successfully delivered for The Education University of Hong Kong ("EdUHK") the contract for the Supply and Installation of Hostel Octopus Payment Air Conditioner System of EdUHK. Within three months after the contract award, we completed the delivery of the Octopus payment system for seven hundred fifty units of air conditioners installed across three hostels of the campus.

We are very proud to serve our clients and the general public and to enhance the sustainability of Hong Kong through the provision of environmental engineering solutions. As our slogan spells, we bring Smart Life!

Financial Performance

For the period, the group had recorded a total revenue of approximately HK$15 million, representing a decrease of 20% over the same period of 2015. Loss attributable to owners of the company for the nine months ended 31 December 2016 was approximately HK$1.18 million as compared to that of profit attributable to owners of the company approximately HK$0.32 million for the corresponding period of 2015.