• Ongoing industry recovery and positive momentum in Galaxy-related activities underpinned robust revenue growth

• Gross profit margin of 69% at higher end of pre-crisis range; net profit margin of 32%

• Galaxy service center opened in Belgium and Galaxy™ 1000 system deliveries continuing on a very select basis, as planned

• More deliveries of Galaxy™ 1000 systems and further roll out into other diamond centres expected in upcoming quarters

 

Singapore, 10 May 2010 – Singapore Exchange Mainboard-listed Sarin Technologies Ltd (“Sarin” or “the Group”) (U77:SI), a worldwide leader in the development, manufacturing and marketing and sale of precision technology products for the planning, processing, evaluation and measurement of diamonds and gems, is pleased to announce its financial results for the quarter ended 31 March 2010.


Q1 2010 Results Summary (US$’m)

	Q1 2010	Q1 2009	% Change
Revenue	13.6	1.1	+ 1,178%
Gross profit	9.4	0.1	+ 11,946%
- Gross profit margin	69%	7%	-
Net profit	4.4	(2.5)	NM
- Net profit margin	32%	NM	-

Driven by ongoing recovery of the diamond manufacturing industry and positive momentum of Galaxy-related activities, Sarin achieved record quarterly revenue of US$13.6 million in Q1 2010. Compared to the depressed level in Q1 2009, revenue rose 1,178% and the increase was broad-based across all geographical segments. In particular, revenue from India and Africa surged 1,429% and 2,347% to US$11.0 million and US$0.9 million, respectively. On a sequential basis, the revenue growth was a healthy 31% compared to US$10.4 million in Q4 2009.


Revenue by Geographical Segments (US$ ‘000)

Due to significantly higher revenue and a change in the sales mix, coupled with a leaner cost structure, as a result of the Group’s active cost management efforts since Q4 2008, gross profit jumped sharply to US$9.4 million, with a gross profit margin of 69%, which is at the higher end of the Group’s pre-crisis historical range. Q1 2010 net profit totaled US$4.4 million as compared to the net loss of US$2.5 million in Q1 2009 and in line with the net profit reported in Q4 2009.

“We recorded a sterling performance in Q1. We are pleased that the roll-out of our Galaxy™ 1000 product is progressing well, with deliveries in the first quarter of 2010 continuing on a very select basis, as planned. We achieved a number of notable milestones in Q1 2010, including the opening of a full service centre in Belgium and BHP Billiton’s decision to adopt the Galaxy™ 1000 to aid in the sale of its rough diamonds to customers in upcoming spot market auctions. With these, Galaxy-related activities continued to contribute over 10% of Group revenue during the quarter,” commented Mr. Uzi Levami, Chief Executive Officer of the Group.

“In view of the growing demand for Galaxy™ 1000 from leading customers from all major diamond centres, additional installations in existing and new service centres such as the USA, Africa and China are planned and continuing and accelerated deliveries of systems to customers are expected in the upcoming quarters,” Mr. Levami added.

The roll out of Galaxy™ 1000 also enhances the demand for Sairn’s manual inclusion mapping systems, such as the DiaExpert Eye, and contributes to entrenching the Group’s leadership position in rough planning products. As for polished planning products, the Group is encouraged by the robust sales for its new products, namely the Instructor™ and DiaMension™ HD. These products are expected to be significant growth drivers for FY2010 and onwards.

The recovery of the diamond industry continues to gain momentum, with the Asian markets, particularly China and India, as the driving force. Higher levels of manufacturing activities are evident across all main manufacturing centres, including Russia. Backed by these favourable business conditions, the Group intends to leverage on the Galaxy™ 1000 technology for the expansion of market share in all related product lines, as well as in all markets, while increasing overall revenues and profits.

This press release should be read in conjunction with Sarin’s Q1 2010 results announcement released on 10 May 2010 to the Singapore Exchange.


About Sarin Technologies:
Established in 1988, Sarin Technologies Ltd. is a worldwide leader in the development and manufacturing of advanced planning, evaluation and measurement systems for diamond and gemstone production. Sarin products include diamond cut and color grading tools, the Galaxy™ 1000 inclusion mapping system, rough diamond optimisation systems, laser cutting and shaping systems and laser-marking and inscription machines. Sarin systems have become an essential gemology tool in every properly equipped gem lab, diamond appraisal business and manufacturing plant, and are today considered essential items by both diamond dealers and retailers.


For more information about Sarin and its products and services, visit http://www.sarin.com