HiSoft Issues Corporate Deposit Account List and Cash Flow Statements

Additional disclosures illustrate HiSoft's commitment to investor transparency, integrity and corporate governance

News provided by

HiSoft Technology International Limited

May 25, 2011, 09:17 ET

BEIJING, May 25, 2011 /PRNewswire-Asia-FirstCall/ -- HiSoft Technology International Limited, ("HiSoft" or the "Company") (NASDAQ: HSFT), a leading China-based provider of outsourced information technology and research and development services headquartered in Dalian, China, today issued an unaudited corporate deposit account list identifying each corporate cash account and the balance and location of each account. The Company also issued an unaudited quarterly cash flow statement disclosing the amount of cash used for operating, investing and financing activities.

"Given recent industry developments, investors may have general concerns regarding the financial integrity and corporate governance practices of Chinese companies listed in the United States," said HiSoft Chief Financial Officer Christine Lu-Wong. "In an effort to further instill investor confidence in our business and prove our dedication to transparency and financial integrity, we have decided to proactively issue additional cash-related disclosures. Going forward, we will continue to disclose our cash flow statement on a quarterly basis, as we position ourselves as a Company with a strong track record for performance, sound corporate governance and financial integrity."

HISOFT TECHNOLOGY INTERNATIONAL LIMITED

Corporate Deposit Account List

(in US dollars in thousands)






March 31, 2011(1)


December 31, 2010(2)

(Unaudited)

Cash in hand

$69

$59

Bank of America, South Carolina, United States

2,868

4,778

Bank of Beijing, Beijing, PRC

502

1,593

Bank of China, Chengdu, PRC

70

135

Bank of Communications, Dalian, PRC

13

58

Bank of Communications, Shanghai, PRC

-

240

Bank of East Asia, Offshore Accounts

6,215

-

Bank of East Asia, Beijing, PRC

15,103

9,925

Bank of Jiangsu, Wuxi, PRC

796

134

Bank of Tokyo-Mitsubishi UFJ, Tokyo, Japan

4,264

2,746

China Merchants Bank, Offshore Accounts

30,001

62,068

China Construction Bank, Dalian, PRC

2,318

1,458

China Merchants Bank, Beijing, PRC

3,531

9,879

China Merchants Bank, Dalian, PRC

49,612

50,000

China Merchants Bank, Guangzhou, PRC

12

208

China Merchants Bank, Shanghai, PRC

439

-

China Merchants Bank, Shenzhen, PRC

2,169

2,342

China Merchants Bank, Wuxi, PRC

3,874

4,405

China Minsheng Banking, Beijing, PRC

2,564

608

Citi Bank, Singapore

1,001

1,186

DBS Bank, Singapore

16

142

Industrial and Commercial Bank of China, Dalian, PRC

94

72

Shenzhen Development Bank, Dalian, PRC

242

242

Standard Chartered Bank, Hong Kong

1,168

14,839

Sumitomo Mitsui Banking Corporation, Tokyo, Japan

394

421

United Overseas Bank, Singapore

771

1,264

Wells Fargo Bank, Virginia, United States

138

1,091

Total

$128,244

$169,893









(1) Amounts shown that are not held in U.S. dollars have been converted at the relevant exchange rates as of March 31, 2011.

(2) Amounts shown that are not held in U.S. dollars have been converted at the relevant exchange rates as of December 31, 2010.


HISOFT TECHNOLOGY INTERNATIONAL LIMITED

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in U.S. dollars in thousands)










Three-Month Periods Ended March 31,


2011

2010

Cash flows from operating activities:

(Unaudited)

(Unaudited)








Net income


2,817

2,967

Adjustments to reconcile net income to net cash (used in) provided by operating activities:





     Provision for doubtful accounts

356

100

Loss on disposal of property, plant and equipment

32

340

Depreciation

918

753

Change in fair value of foreign-currency forward contract

(4)

(17)

Amortization of intangible assets

411

163

Interest expense (income)

64

(38)

Share-based compensation expenses

1,177

589

Changes in fair value of contingent consideration

350

144








Changes in operating assets and liabilities:





Accounts receivable

(1,243)

(3,532)

Other current assets

(1,095)

287

Other assets

(41)

(427)

Accounts payable

134

(415)

Other liabilities

(3,653)

556







Net cash provided by operating activities

223

1,470







Cash flows from investing activities:





Purchase of property, plant and equipment

(1,491)

(918)

Restricted cash

(15)

(19)

Cash received from non-controlling

908

-

Payment for business acquisition

(2,200)

(2,430)







Net cash used in investing activities

$　

(2,798)

$

(3,367)



HISOFT TECHNOLOGY INTERNATIONAL LIMITED

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - continued

(in U.S. dollars in thousands)


Three-Month Periods Ended March 31,

2011

2010



          (Unaudited)

 (Unaudited)







Cash flows from financing activities:





Repayment of bank loan

$

(40,064)

$

-

Cash received from share subscription receivables

-

1

Proceeds from issuance of common share under employee option plan

-

511

Prepayment for initial public offering expenses

-

(590)

Payment on capital lease obligations

-

(9)







Net cash used in financing activities

(40,064)

(87)







Effect of exchange rate changes

990

5







Net decrease in cash and cash equivalents

(41,649)

(1,979)

Cash and cash equivalents at beginning of period

169,893

54,842







Cash and cash equivalents at end of period

$

128,244

$

52,863

About HiSoft Technology International Limited

HiSoft Technology International Limited (NASDAQ: HSFT) is a leading China-based provider of outsourced information technology and research and development services headquartered in Dalian, China. HiSoft provides its services to leading companies around the world through a combination of onshore and offshore delivery capabilities. HiSoft leverages its skilled technology specialists and client-centric delivery centers to offer customers reliable and high-quality technology solutions. For more information about HiSoft, please visit http://www.hisoft.com    

Safe Harbor Statement

This press release contains forward-looking statements. These statements constitute "forward-looking" statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "target," "going forward," "outlook" and similar statements. Such statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond HiSoft's control, which may cause HiSoft's actual results, performance or achievements to differ materially from those in the forward-looking statements. Further information regarding these and other risks, uncertainties or factors is included in HiSoft's filings with the U.S. Securities and Exchange Commission. HiSoft does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

For investor and media inquiries please contact:

In China:

Mr. Ross Warner

HiSoft Technology International Limited

Tel: +86-10-5987-5865

Email: [email protected]

Mr. Agustin Bautista

Ogilvy Financial, Beijing

Tel: +86-10-8520-6166

Email: [email protected]

In the U.S.:

Ms. Jessica Barist Cohen

Ogilvy Financial, New York

Phone: +1-646-460-9989

Email: [email protected]

SOURCE HiSoft Technology International Limited

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