mainly to increase in revenue from indoor & outdoor of RMB39.5 million, sales of equipment of RMB18.1 million and system integration of RMB19.9 million. The increase was mainly due to increase in sales to China Mobile in Shanxi Province. The increase was offset by the decrease in revenue from emergency mobile communication station (EMCS) of RMB31.2 million.
Gross profit for 1Q11 decreased by RMB4.0 million (8.8%) compared to 1Q10. The decrease was mainly due to decrease in gross profit margin from 38.2% in 1Q10 to 24.8% in 1Q11. The decrease was mainly due to higher contribution from sales of equipment and system integration which have a lower gross profit margin. The percentage of contribution from sales of equipment and system integration increased from 15.9% in 1Q10 to 22.3% in 1Q11 and from 5.4% in 1Q10 to 15.9% in 1Q11 respectively.
Also, decrease in gross profit margin due to the pressure on the selling price since the Telco implemented the central procurement policy. In view of this, the Group has mitigated this downward trend by focusing on higher margin products and services as well as expanding its recurring income business.
As a result of the above, our net profit for 1Q11 decreased by RMB1.0 million (3.5%) compared to1Q10.
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