China Ventures Inc.: Board Approves US$1,875,000 Investment in China and Announces Year-end Financial Results.Business Editors VANCOUVER, B.C.--(BUSINESS WIRE)--Feb. 28, 2001 China Ventures Inc. (the "Company") (CDNX CDNX See Canadian Venture Exchange (CDNX). :CHV CHV canine herpesvirus. ) today announced that its Board of Directors has approved the investment of US$1,875,000 to fund two of its business ventures. US$1,200,000 of the investment will go to finance Ether ether, in chemistry ether, any of a number of organic compounds whose molecules contain two hydrocarbon groups joined by single bonds to an oxygen atom. Circumplex Networks Co., Ltd. (ECN (Electronic Communications Network) A computerized, private financial trading system. Terra Nova Trading (www.terranovatrading.com) and Instinet (www.instinet.com) are examples. ), a joint venture company involved in network infrastructure and integration in China. The remaining US$675,000 will be used to advance the Company's education subsidiary, CEN CEN - Conseil Européen pour la Normalisation. A body coordinating standardisation activities in the EEC and EFTA countries. China Education Network Ltd. (CEN), which is developing a computer and information technology training platform for deployment in China's primary and middle schools. "After careful analysis and due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. , the Company has chosen to further invest in two of the most rapidly growing sectors of China's new economy, information technology infrastructure and education, both of which receive the highest level of support from the Chinese government Ever since Republic of China founded in January 1st, 1912, China has had several regional and national governments. List
Ether Circumplex Networks Co., Ltd. ECN's initial focus will be on providing systems integration and valued added network services to China's financial service sector, which has a strong demand for technology. The demand is backed up by dedicated resources and is a result of financial institutions having to compete on the world stage when China enters the World Trade Organization (WTO). In addition to providing network solutions, ECN will distribute Proxim, Inc.'s wire-free broadband technology broadband technology Telecommunications devices, lines, or technologies that allow communication over a wide band of frequencies, and especially over a range of frequencies divided into multiple independent channels for the simultaneous transmission of different signals. into the Chinese marketplace. Proxim is the world leader in the development of wire-free LAN (Local Area Network) A communications network that serves users within a confined geographical area. The "clients" are the user's workstations typically running Windows, although Mac and Linux clients are also used. technology. Incorporating their wireless building-to-building products into ECN's network solutions will give the company a competitive advantage. ECN's first network installation, in the final stages of contract negotiation, will link all 78 branches of the Yantai Housing and Savings Bank savings bank, financial institution that, until recently, performed only the following functions: receiving savings deposits of individuals, investing them, and providing a modest return to its depositors in the form of interest. . The Bank is located in Shandong, one of China's richest provinces. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the Bank, it has approximately US$1.2billion in assets and is typical of at least 100 other regional banks in China with a similar need for network services. ECN's ability to help prepare the Yantai Housing and Savings Bank for the new era of banking will be closely monitored by its competitors, and ideally will become a model for other institutions. Upon establishing itself as a dependable and cost-effective cost-effective, n the minimal expenditure of dollars, time, and other elements necessary to achieve the health care result deemed necessary and appropriate. network solution provider, ECN intends to expand its business base to providing e-business solutions to commercial enterprise, which is a burgeoning market in China. CEN China Education Network Ltd. The Company's education subsidiary, CEN China Education Network Ltd., is developing an innovative online and offline education technology and learning system to be deployed in the primary and middle schools of China. With over 700,000 schools in this market (according to the China Statistical Yearbook 1999), most of which lack the ability to deliver newly mandated computer and IT training courses, there is a sizeable demand for cost-effective learning solutions. The system has as its backbone a proprietary learning platform which consists of a software system that turns traditional computer laboratories into interactive learning centers with training programs and educational resources. CEN's interactive platform will also be available on a series of CD-Rom titles, providing students with the opportunity to learn and use the educational resources at home. According to conservative estimates, the national potential for education outlays Outlays Payments on obligations in the form of cash, checks, the issuance of bonds or notes, or the maturing of interest coupons. by private citizens is about 250 billion RMB RMB Right Mouse Button RMB Regional Management Board (USACE) RMB Rolf Maier Bode (musician, band) RMB Ren Min Bi (currency of People's Republic of China) (US $30.2 billion) annually, roughly equivalent to the national budget for education in 1997. (Source: www.Chinaonline.com) The products are being designed to meet new government curriculum requirements for computer and information technology training, allowing them to be easily incorporated into the classroom environment. The investment will be used to develop a commercial version of the software platform and establish marketing programs for both the school and home versions of the Company's products. China Ventures Announces Year End Financial Results The company also released its financial results for the year ended October 31, 2000. A loss of US$1,460,000 was incurred after amortization of US$557,000 of goodwill and before write-down of certain equipment not integral to the company's core business. The equipment was written down to its net realizable value Net realizable value (NRV) is a commonly used method of evaluating an asset's worth in the field of inventory accounting. NRV is part of GAAP rules that apply to valuing inventory, so as to not overstate or understate the value of inventory goods. of US$500,000. Accordingly, net loss for the year was US$2,750,000 (US$0.06 per share) compared to US$140,000 for the prior year. As at the fiscal year-end Fiscal Year-End The completion of a one-year, or 12-month, accounting period. Notes: The reason that a company's fiscal year often differs from the calendar year and does not close on Dec 31, is due to the nature of company's needs. , the Company had working capital of US$3,210,000, a significant portion of which will be invested in ECN and CEN as noted above. Detailed statements are attached. Extension of Warrants Due January 26, 2001 The Company previously announced that it had applied for Canadian Venture Exchange The Canadian Venture Exchange (CDNX) is now a defunct stock exchange having been acquired by the TSX Group in 2001 and renamed the TSX Venture Exchange. History of the Canadian Venture Exchange (CDNX) approval to extend the expiry date expiry date expire n → date f d'expiration; (on label) → à utiliser avant ... expiry date expire n → Ablauftermin m for the first tranche Tranche One of several related securities offered at the same time. Tranches from the same offering usually have different risk, reward, and/or maturity characteristics. tranche A class of bonds. of its share purchase warrants due January 26, 2001. As the company did not receive such regulatory approval, the warrants expired ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. January 26, 2001. The Canadian Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. This press release contains certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve a number of risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Ron Shon, President
CHINA VENTURES INC.
Consolidated Balance Sheets
(Expressed in U.S. Dollars)
October 31, 2000 and 1999
2000 1999
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Assets
Current assets:
Cash and short-term deposits $3,264,469 $266,398
Accounts receivable 20,279 680
Prepaid expenses and advances 96,050 -
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3,380,798 267,078
Investment in Anhui Richer 171,754 71,754
Mining and mill equipment 500,000 -
Computer equipment and software development
costs, net of accumulated depreciation 94,659 -
Goodwill, less accumulated amortization
of $556,925 10,581,577 -
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$14,728,788 $338,832
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Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued liabilities $173,458 $58,792
Non-controlling interest in Circumplex
Networks, Inc. 20,000 -
Shareholders' equity:
Share capital 17,566,873 560,839
Deficit (3,031,543) (280,799)
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14,535,330 280,040
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$14,728,788 $338,832
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CHINA VENTURES INC.
Consolidated Statements of Operations and Deficit
(Expressed in U.S. Dollars)
Years ended October 31, 2000 and 1999
2000 1999
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Revenues:
Interest income $16,249 $ -
Expenses:
Consulting 62,691 95,812
Foreign exchange loss 10,229 2,856
Legal and audit 379,760 23,957
Technical Services Agreement fees 85,137 -
Office and telephone 47,327 10,201
Travel 64,294 10,089
Depreciation 32,273 -
Amortization of goodwill 556,925 -
Regulatory fees 34,537 -
Directors and officers remuneration 142,495 -
Other expenses 60,944 -
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1,476,612 142,915
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Loss before the following 1,460,363 142,915
Write-down of mining and mill equipment 1,290,381 -
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Loss for the year 2,750,744 142,915
Deficit, beginning of year 280,799 137,884
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Deficit, end of year $3,031,543 $280,799
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Weighted average number of shares outstanding 46,607,330 10,768
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Loss per share $0.06 $13.27
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