Edvance International Announces Positive Profit Alert for Interim Results Expecting Net Profit Jumps Over Fivefold YoY

HKbitEX Investment Contributes to First Fair Value Gain and Potential Synergies to Accelerate Business Innovation and Development

(Hong Kong – 23 September 2021) The leading cybersecurity and fintech innovation company in Hong Kong, Edvance International Holdings Limited (“Edvance International” or the “Company”, together with the Company’s subsidiaries, collectively the “Group”) (SEHK stock code: 01410.HK), is pleased to announce its positive profit alert for the six months ended 30 September 2021 (the “Period”, “FY2022 1H”).

Based on the preliminary assessment of the unaudited consolidated management accounts of the Group and currently available information, it is expected that for the six months ending on 30 September 2021, the Group’s net profit attributable to owners of the company will increase by at least 500% over the same period last year. Such significant increases in net profit are primarily driven by the fair value gain on financial assets at fair value through profit and loss (“Fair Value Gain”) in relation to the unlisted investment of Tykhe Capital Group Limited (“Tykhe”), the holding company of Hong Kong Digital Asset Ex Limited (HKbitEX).

Edvance International completed the subscription of the Series A2 Preference Shares of Tykhe in December 2020, which the Group held approximately 6% of the enlarged issued shares (on an as-converted basis) of the Tykhe, the HKbitEX’s holding company. The Company has been notified on 15 September 2021 that, Tykhe had entered into a subscription agreement with several investors with respect to issuance of Pre-Series B Preference Shares of Tykhe at a post money valuation of USD300 million, and such subscriptions were completed on 27 July 2021. Therefore, based on the post money valuation of the Group’s holding of its Series A2 Preference Shares, the Fair Value Gain is approximately HK$100 million, which will be recognised in FY2022 1H, while there was no such similar gain occurred in FY2021 1H.

Mr. Raymond Liu, Chairman and Group CEO of Edvance International commented, “The investment in HKbitEX through Axion Global Investment Limited was our first step to tap into fintech industry. The Group has the utmost confidence in the prospects of HKbitEX and consider it as a long-term investment to seize the greater opportunities and returns. Riding on the essential advantages of HKbitEX, the Group believes that it can revolutionize the local financial market ecology. Its investment prospects have also been recognised by the capital market by HKbitEX’s successful fund-raising in Pre-Series B Preference Shares and the valuation appreciation.”

Edvance International has been actively building up the digital asset ecosystem with great progress in three aspects: venture capital, asset management and innovation. As for asset management, the Group submitted application to the Hong Kong Securities and Futures Commission (“SFC”) for a virtual asset manager license; the Group’s innovation projects through its subsidiary, Axion Global Innovation Centre, have also seen satisfactory progress. We believe that the Group can give full play to the synergies, to further create capital returns for shareholders.