The troubled Irish security software firm, Baltimore Technologies, is expanding its Hong Kong operations in a bid to target the greater China market.

As part of its planned expansion, the company is tendering for a lucrative new contract to provide an upgraded e-certification to Hongkong Post for use with a new smart identity card.

Baltimore chief executive, Mr Bijan Khezri, said in a newspaper interview that the company had enjoyed success in the Hong Kong market, including a partnership with the post office, and planned to use the Special Administrative Region as a launching point into the rest of China.

"From Hong Kong we can drive business into the region," he told the South China Morning Post newspaper.

The decision to expand in Hong Kong comes as Baltimore's future is uncertain. The collapse of the technology sector and the subsequent downturn has seen the company cut more than half its workforce during the past year. Baltimore employs 500 people, down from a high of 1,100.

Mr Khezri said Baltimore was concentrating on its core products and was moving away from providing services such as content management in an effort to cut its losses.

The company has reported a preliminary pre-tax loss for last year of 7.5 billion Hong Kong dollars (€1.06 billion).

Analysts say Baltimore has enough funds to make it to the end of this year at its current rate of losses. But that will leave it out of money long before its projected break-even point in the second quarter of next year.

In March, the company pushed the date of expected profitability back from its initial estimate of this summer.

However, Mr Khezri rejected assessments of Baltimore's prospects, saying analysts and media commentators had been wrong when they over-hyped the tech industry during the boom, and were still getting it wrong after the collapse by being too negative.

The Baltimore vice-president for North Asia, Irish-born Mr Greg Leniston, said the company was optimistic it would be able to use its relationship with the Hong Kong Post Office to secure the e-cert upgrading contract.

The e-certs serve as a means of online identity authentication using public key infrastructure (PKI) technology, which ensures messages and documents are not tampered with or viewed during transit. Similar technology from Baltimore is used in Hong Kong by companies such as Jetco.