SOURCE: Global Innovative Systems Inc.

July 19, 2006 13:04 ET

Global Innovative Announces Strong and Growing Sales From Subsidiary Beijing Illumination (Hong Kong) Limited

HONG KONG -- (MARKET WIRE) -- July 19, 2006 -- Global Innovative Systems Inc. (OTCBB: GBSY) is pleased to announce that its majority-owned subsidiary, Beijing Illumination (Hong Kong) Limited ("Beijing Illumination"), expects strong sales results for its fiscal Q1 2007 ended June 30, 2006, and expects sales to increase in the coming quarters due to robust demand for Metal Halide Lamps and High-Pressure Sodium Lamps in both the China and international export markets.

Revenue for Beijing Illumination during its fiscal Q1 is projected to exceed HK$12,000,000 (approximately US$1,600,000), with net income of not less than HK$3,500,000 (approximately US$450,000). Global Innovative is the major shareholder of Beijing Illumination, holding a 76.8% ownership interest. As a result, the strong performance of Beijing Illumination is expected to contribute no less than HK$9,000,000 (approximately US$1,150,000) of Q1 revenue to Global Innovative, and approximately HK$2,700,000 (approximately US$340,000) of net income to Global Innovative's financial results for fiscal Q1 2007.

"Global Innovative's acquisition of a majority ownership interest in Beijing Illumination was one our company's key corporate developments in its recently completed fiscal year 2006," said Bondy Tan, President and Chief Executive Officer of Global Innovative. "Through this acquisition, Global Innovative expanded its business into the manufacturing and sale of specialty lighting source products, and gained access to Beijing Illumination's solid capabilities in advanced lighting equipment research, development, manufacturing, intellectual property and sales."

Continued Mr. Tan, "Beijing Illumination's fiscal Q1 results exceeded our forecasts, and we find the future growth prospects for Beijing Illumination very encouraging. To meet the strong and growing demand experienced by Beijing Illumination in fiscal Q1, production lines have recently been expanded for both Metal Halide Lamps and High-Pressure Sodium Lamps. Additionally, Beijing Illumination's new production lines for its Ultra High-Pressure Mercury Lamps and Special Application HID Lamps for projectors and projection TVs are now ready to commence full production, and its new production line for Automobile HID Xenon Lamps is expected to begin production later in 2006."

"Beijing Illumination's new Ultra High-Pressure Mercury Lamp production lines incorporate advanced lighting technology developed internally, and enhanced by technology of our strategic partner eele Laboratories, LLC, a U.S.-based developer and manufacturer of advanced lighting products," said Mr. Michael Ko, Chief Executive Officer of Beijing Aihua New Enterprise Lighting Appliance Company Ltd., the main operational subsidiary of Beijing Illumination. "The combination of these technologies means that the Ultra High-Pressure Mercury Lamps we manufacture within our new production lines will have much lower production costs. This is expected to enable us to generate attractive profits by offering selling prices as low as US$35 per unit to start with, as compared to approximately US$200-350 per unit for traditionally-manufactured Ultra High-Pressure Mercury Lamps of similar quality."

Concluded Mr. Ko, "Our strong lighting technologies, our strong brand recognition for quality and our new ability to achieve significant reductions in manufacturing costs within the mass production of high-quality Ultra High-Pressure Mercury Lamps has opened up many new sales opportunities for Beijing Illumination. To capitalize on these opportunities, Beijing Illumination has engaged in negotiations to supply several major computer and lighting system manufacturers with long-term, guaranteed volume contracts, both within China and for export internationally. The closing of anticipated contracts and ramp-up of all new production lines within the next two quarters is expected to increase our annual production capacity to 3,000,000 Metal Halide Lamps and Special Application HID Lamps, 3,000,000 High-Pressure Sodium Lamps and 30,000 Ultra High-Pressure Mercury Lamps, so the future looks bright."

Beijing Illumination, a 76.8% majority-owned subsidiary of Global Innovative, is a holding company whose subsidiaries are engaged in the manufacture, sale, research and development of lighting equipment. Beijing Illumination, through its wholly-owned subsidiary Beijing Aihua New Enterprise Lighting Appliance Company Ltd., manufactures and sells the following main categories of High-Intensity Discharge, or HID, related lighting products under the "AIHUA" brand name: (1) Metal Halide Lamps; (2) High-Pressure Sodium Lamps; and (3) Special Application HID Lamps. In addition to HID lamps, Beijing Illumination also produces and sells Ultra High-Pressure Mercury Lamps under the brand name "MHP". Beijing Illumination's seven sales offices throughout Mainland China and its sales network of over 100 distributors and agents currently derive approximately 60% of sales from Greater China and 40% from international exports. Beijing Illumination has achieved ISO9001-2000 certification, it is recognized governmentally as a "Beijing New Hi-Tech Enterprise", it is represented on the executive unit of the "Torch Program" in China, and it is a member of the National Lighting Appliance Association, the National Lighting Institute and the National Electrical Video Association of China.

About Global Innovative

Global Innovative Systems Inc. (OTCBB: GBSY) delivers customized energy management solutions, lighting products and innovative lighting solutions. Since 1999, over 100 commercial, industrial, government and multi-residential clients have benefited from Global Innovative's solutions. Through wholly owned subsidiary Tech Team Holdings Limited, Global Innovative provides total energy management products and solutions which optimize energy consumption, lower costs, and enhance competitiveness for clients. Through subsidiary Beijing Illumination (Hong Kong) Limited, Global Innovative manufactures and sells HID (High-Intensity Discharge) lighting products and Ultra High-Pressure Mercury Lamps. Through joint venture subsidiary Lightscape Technologies (Macau) Ltd., Global Innovative provides full service lighting design solutions including interior set design and fabrication, computer-controlled special effects, intelligent lighting, laser and multimedia technologies. Our headquarters are in Hong Kong, and we have offices in Singapore, China, Macau and Canada.

Safe Harbor Provision

The Private Securities Litigation Reform Act of 1995 provides a "Safe Harbor" for forward-looking statements. This Press Release may contain, in addition to historical information, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are identified by their use of terms and phrases such as "believe," "expect," "plan," "anticipate" and similar expressions identifying forward-looking statements. Investors should not rely on forward-looking statements because they are subject to a variety of risks, uncertainties and other factors that could cause actual results to differ materially from Global Innovative's expectations, and Global Innovative expressly does not undertake any duty to update forward-looking statements. These factors include, but are not limited to: Beijing Illumination's ability to achieve actual fiscal Q1 financial statement results totaling or exceeding the projected HK$12,000,000 (approximately US$1,600,000) of revenue and HK$3,500,000 (approximately US$450,000) of net income; Global Innovative's ability to achieve actual fiscal Q1 financial statement results reflecting a proportionate share of Beijing Illumination's actual fiscal Q1 financial results totaling or exceeding the projected HK$9,000,000 (approximately US$1,150,000) of revenue and HK$2,700,000 (approximately US$340,000) of net income; Global Innovative's ability to fully reflect the fiscal Q1 projected revenue and net income deriving from its proportionate ownership interest in Beijing Illumination within its Q1 financial statements; Beijing Illumination's ability to close, secure sufficient working capital to deliver upon, and collect revenue from potential sales contracts under negotiation with computer and lighting equipment manufacturers; Beijing Illumination's ability to achieve a lower pricing for Ultra High-Pressure Mercury Lamps at a minimum of approximately US$35 per unit; Beijing Illumination's ability to ramp-up all new production lines within the next two quarters and to increase its annual production capacity to 3,000,000 Metal Halide Lamps and Special Application HID Lamps, 3,000,000 High-Pressure Sodium Lamps and 30,000 Ultra High-Pressure Mercury Lamps; and other factors which may cause the actual results, performance or achievements of Global Innovative to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Information concerning potential factors that could affect the company is detailed from time to time in the company's reports filed with the Securities and Exchange Commission.

Contact Information

  • For more information, please contact:
    Global Innovative Systems Inc.
    Investor Relations
    1-888-852-8838
    Website www.gistt.com
    Email: Email Contact