GuangZhou Global Telecom

overview

Guangzhou Global Telecom, Inc. is a U.S. company that is publicly traded on the NASDAQ OTC_BB under the ticker symbol GZGT.

Guangzhou Global Telecom, Inc. operates in China through Guangzhou Global Telecom Co., Ltd. (GGT), a wholly owned subsidiary of Global Telecom Holding Limited, which is a wholly owned subsidiary of Guangzhou Global Telecom, Inc.

What We Do

Mobile has always been the heart of our business, but the group is moving towards new avenues of growth potential in emerging markets and portfolio diversification which are essential to constantly keep up with today’s ever changing market.

Guangzhou Global Telecom is a retailer and distributor of wireless products and services. Operating in Guangzhou, the heart of one of China’s leading commercial and manufacturing regions, Guangzhou Global Telecom has established itself as a leading distributor, having formed partnerships with top Chinese telecom providers China Telecom, China Unicom and China Mobile as well as handset manufacturers Nokia, Rowa, Gionee, and Konka. The telecommunications portfolio provides a steady stream of revenue and recurring income for GGT.

The company also currently owns and operates ten retail locations in Guangzhou.

The company has achieved rapid revenue growth since its inception in 2004. In 2005, its first full year in existence, Guangzhou Global Telecom had revenues of $6.7 million. Then in 2006 revenues rose by 91%, to $12.8 million. By 2009, revenues are projected to grow to more than $48 million. Year 2007 is an expanding year for Guangzhou Global Telecom with the setting up and expansion of operations in the following places: -

Singapore will hold its 1st Formula One racing in September 2008, affectionately known as “2008 FORMULA 1TM SingTel Singapore Grand Prix”. It is the 1st street race in Asia and subjected to final safety clearances, will also be the 1st night race in F1TM history. (Source: http://www.singaporegp.sg)

In the year 2005, the Government of Singapore has approved plans to legalize casino gambling and the casinos, also known as Integrated Resorts (IR), with the 1st to be operational in Year 2009 and the 2nd to be completed by Year 2010. (Source: http://www.singaporerocks.com)

On 21st February 2008, Singapore has been appointed to host the inaugural Youth Olympic Games in Year 2010, after beating close rivals Moscow, Athens, Bangkok and Turin. (Source: http://www.singapore2010.sg)

Moreover, GGT has also entered into preliminary talks with the following companies of immense high growth potential with the intention of co-operation: -

Market Background

China is the world’s largest mobile telecommunications market; 500 million Chinese (37% of the population) use mobile phones. By 2010, it is projected that half of China’s 1.3 billion people will be using mobile phones.

The dollar value of the China mobile market is staggering. Academic models project a total value of $110 billion by 2013, rising to $250 billion by 2023 and $336 billion by 2030, with a subscriber base of 1.2 billion users.

Guangzhou Global Telecom: Perfectly Positioned

Guangzhou Global Telecom is leveraging its unique position in the Chinese market to maximize its advantage going forward. Building on its success as a distributor and retailer, the company is now implementing an aggressive plan to open fixed and virtual retail outlets throughout rural China. These outlets will enable the company to directly sell its current product line as well as mobile phone value-added services and consumer electronics products. Guangzhou Global Telecom’s value-added services will operate exclusively with Guangzhou Global Telecom-distributed products.

The Group’s strategy addresses changing customer needs, the availability of new technologies, and the high growth potential of emerging markets. This strategy is positioning us well in an increasingly competitive environment together with rising costs and as our customers have greater choice in communications.

Guangzhou Global Telecom’s strategies for future growth in the Chinese market include:

Prospects for the Year Ahead

For 2008, expansion plans are underway, firstly with the re-location of the present headquarter premise to JinKe Building (金科大厦) which is in the heart of Guangzhou’s commercial district, with effect from April onwards.

GGT expanded operations with the setting up of Huantong Telecom Singapore Company Pte Ltd (Singapore) in August 2007. The subsidiary will study the various market segments in South-East Asia (mainly Malaysia, Indonesia, Vietnam, etc.) and will also serve as the SEA regional hub for GGT.

Concurrently, GGT is looking at opportunities in the Middle-East, specifically, the United Arab Emirates and the rest of the Gulf region. With a population estimated at 4.44 million (2007 estimate) but a GDP of US$189.6 billion (2007 estimate), these statistics show the fast growing economic potential of the UAE and GGT wants to capitalize on this and increase the return on investment for shareholders of the company.

GGT continues to identify and acquire highly potential small and medium enterprises in developing markets as well as setting up more branches in China. With this move to significantly increase our presence in China, GGT plans to further reach the population of over 1.2 billion consumers in the country.

GGT has projected the sales revenue for the 2008 accounting fiscal period to reach a conservative figure of 300 million Yuan (US$42 million), in mind of the uncertainty in global economies which will affect consumer demand. Revenues are mainly from the core business distribution of mobile phones, phone cards, accessories, value added services and lineless messaging systems. The acquirement of new business markets and collaborations in 2007 are also expected to contribute to the projected figure.

The management is constantly looking for new growth opportunities to further expand and to diversify the group’s portfolio. Current shareholders and potential investors in GZGT will ride on the professionalism and acute business sentiments of the company’s management.

By delivering and executing the Group’ strategy, it has generated positive results and the Group’s forecast for the future is poised to leap to greater heights in terms of revenue growth and maximizing returns.

The company is confident that the groundwork laid down in 2007 will pave the way for a more successful 2008 and the years ahead in terms of revenue and profit growth and also realize the high growth value of GZGT.

Guangzhou Global Telecom was established in March of 2004. It aims to be a principal distribution agent for China Telecom, China Unicom, and China Mobile, and become the largest sales and distribution centre of mobile phones, mobile phone parts and cards in China.