MIRA
INFORM REPORT
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Report Date : |
15th
June 2006 |
IDENTIFICATION
DETAILS
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Name : |
HENKEL LOCTITE CHINA CO., LTD. |
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Registered Office : |
No. 90, Zhujiang Road, Yantai City Shandong Province, 264006 Pr China |
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Country : |
China |
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Financials (as on) : |
31/12/2006 |
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Date of Incorporation : |
sep. 9,
1987 |
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Com. Reg. No.: |
000034 |
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Legal Form : |
Wholly
Foreign-Owned Enterprise |
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Line of Business : |
Engaged
in manufacturing cementing and sealant |
RATING & COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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56-70 |
A |
Financial & operational base are
regarded healthy. General unfavourable factors will not cause fatal effect.
Satisfactory capability for payment of interest and principal sums |
Fairly Large |
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Status : |
Good |
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Payment Behaviour : |
Regular
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Litigation : |
Clear |
NAME & ADDRESS
HENKEL LOCTITE CHINA CO., LTD.
no. 90,
zhujiang road, yantai city
shandong
province, 264006 PR CHINA
TEL: 86
(0) 535-6372999
FAX: 86
(0) 535-6371999
EXECUTIVE SUMMARY
INCORPORATION
DATE : sep. 9, 1987
REGISTRATION
NO. : 000034
REGISTERED
LEGAL FORM : wholly foreign-owned enterprise
CHIEF
EXECUTIVE :
MR. shen weikang (CHAIRMAN)
STAFF
STRENGTH : 285
REGISTERED
CAPITAL : USD3,000,000
BUSINESS
LINE :
manufacturing
TURNOVER : rmb
511,310,000 (AS OF DEC. 31, 2005)
EQUITIES :
RMB 487,700,000 (AS OF DEC. 31, 2005)
PAYMENT : AVERAGE
RECOMM.
CREDIT RANGE : up to usd
3,000,000
MARKET
CONDITION :
COMPETITIVE
FINANCIAL
CONDITION : fairly
good
OPERATIONAL
TREND : upward
GENERAL
REPUTATION : well-known
EXCHANGE
RATE : RMB
8.00 = US$1 AS OF 2006-06-15
SC was
registered as a wholly foreign-owned enterprise at local Administration for
Industry & Commerce (The official body of issuing and renewing business
license) on Sep. 9, 1987.
Company Status: Wholly foreign-owned
enterprise. This
form of business in PR China is defined as a legal person. It is a limited
co. established within the territories of PR China with capital provided
totally by the foreign investors. More than one foreign investors may
jointly invest in a wholly foreign-owned enterprise. The investing
party/parties solely exercise management, reap profit and bear risks and
liabilities by themselves. This form of companies usually have a limited
duration is extendible upon approval of Examination and Approval
Authorities.
SC’s
registered business scope includes manufacturing and selling all kinds anaerobic
sealer and sealant, industrial sealer and sealant, washing agent, accelerant, electrowelding
wire, soldering flux
and associated equipment.
SC is
mainly engaged in manufacturing cementing and sealant.
Mr. Shen
Weikang has been chairman of SC since 2004.
SC owns
about 285 staff at present.
SC is
currently operating at the above stated address, and this address houses its
operating office and factory in the development zone of Yantai. Our checks
reveal that SC owns the total premise about 7,800 square meters.
SC is
not known to host web site of its own at present.
In 2004,
SC changed its legal representative from Mr. Steve Ellis to Mr. Shen Weikang
(沈伟康), and in 2005, SC changed its shareholder from
America Loctite Inc. to the present one.
MAIN
SHAREHOLDERS:
Name % of Shareholding
(Ireland)
Loctite Inc. 100
Chairman:
Mr. Shen
Weikang, 46 years old with university education. He is currently responsible
for the overall management of SC.
Working
Experience(s):
From
2004 to present Working in
SC as chairman.
General Manager:
Mr. Wang
Ping, 44 years old with university education. He is currently responsible for
the daily management of SC.
Working
Experience(s):
From
2001 to present Working in
SC as general manager.
SC is
mainly engaged in manufacturing cementing and sealant.
SC’s
products mainly include: cementing and sealant, etc.
SC’s
brand is “Loctite”.
SC
sources its materials 100% from domestic market, mainly from Zhejiang province;
SC sells its products 75% in domestic market, mainly in Shanghai, and 25% to
international market.
The
buying terms of SC include T/T and Credit of 30-90 days. The payment terms of
SC include T/T, L/C and Credit of 30-90 days.
*Major
supplier:
=============
Zhejiang
Yuyao Luojiang Plastic Plant Branch
*Major Customer:
==============
Shanghai
GM Co., Ltd.
SC is
not known to have subsidiary at present.
Overall payment appraisal
:
( )
Excellent ( ) Good
(X) Average ( ) Fair
( ) Poor (
) Not yet determined
The appraisal serves as a reference to reveal SC's
payments habits and ability to pay. It
is based on the 3 weighed factors:
Trade payment experience (through current enquiry with SC's suppliers),
our delinquent payment and our debt collection record concerning SC.
Trade payment experience
: SC did not provide any name of trade/service suppliers and we have no
other sources to conduct the enquiry at present.
Delinquent payment record
: None in our database.
Debt collection record : No
overdue amount owed by SC was placed to us for collection within the last 6
years.
Industrial
and Commercial Bank Development Zone Branch
AC#1606020809200103968
Relationship:
Normal.
Balance Sheet (as of Dec. 31, 2005)
Unit: RMB
thousand yuan
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Cash
& bank |
26,070 |
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Inventory |
46,010 |
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Short
investment |
364,000 |
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Accounts
receivable |
57,550 |
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Other
Accounts receivable |
13,000 |
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Accounts
payable in advance |
3,370 |
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To be
apportioned expense |
1,140 |
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Other
current assets |
0 |
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------------------ |
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Current
assets |
511,140 |
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Fixed
assets |
83,830 |
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Fixed
assets net value |
62,380 |
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Projects
under construction |
21,450 |
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Long
term investment |
0 |
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Other
assets |
0 |
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------------------ |
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Total
assets |
594,970 |
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============= |
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Short
loans |
0 |
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Accounts
payable |
75,790 |
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Accounts
receivable in advance |
2,250 |
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Other
Accounts payable |
10,050 |
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Welfares
payable |
6,220 |
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Salaries
payable |
4,740 |
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Taxes
payable |
7,880 |
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Withdraw
the expenses in advance |
330 |
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Other
current liabilities |
10 |
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------------------ |
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Current
liabilities |
107,270 |
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Long
term liabilities |
0 |
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Other
liabilities |
0 |
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------------------ |
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Total
liabilities |
107,270 |
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Equities |
487,700 |
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------------------ |
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Total
liabilities & equities |
594,970 |
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============= |
Income Statement (as of Dec. 31, 2005)
Unit: RMB
thousand yuan
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Turnover |
511,310 |
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Cost
of goods sold |
238,940 |
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Sales expense |
77,480 |
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Management expense |
42,490 |
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Finance expense |
1,510 |
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Non-operating
income |
9,350 |
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Profit
before tax |
160,240 |
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Less:
profit tax |
24,640 |
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Profits |
135,600 |
Important Ratios (as of Dec. 31, 2005)
=============================
*Current
ratio 4.76
*Quick
ratio 4.34
*Liabilities
to assets 0.18
*Net
profit margin (%) 26.52
*Return
on total assets (%) 22.79
*Inventory
/Turnover ×365 33 days
*Accounts
receivable/Turnover ×365 41 days
*Turnover/Total
assets 0.86
* Cost
of goods sold/Turnover 0.47
PROFITABILITY:
FAIRLY GOOD
The
turnover of SC appears fairly good in its line.
SC’s net
profit margin is fairly good.
SC’s
return on total assets is fairly good.
SC’s
cost of goods sold is fairly low, comparing with its turnover.
LIQUIDITY:
FAIRLY GOOD
The
current ratio of SC is maintained in a good level.
SC’s
quick ratio is maintained in a good level.
The
inventory of SC is maintained in an average level.
The
accounts receivable of SC is maintained in an acceptable level.
SC has
no short-term loan in 2005.
SC’s
turnover is in an average level, comparing with the size of its total assets.
LEVERAGE:
FAIRLY GOOD
The debt
ratio of SC is low.
The risk
for SC to go bankrupt is low.
Overall
financial condition of the SC: Fairly good.
SC is
considered medium-sized in its line with fairly good financial conditions. A
credit line up to USD 3,000,000 appears to be within SC’s capacities.
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial
base with the strongest capability for timely payment of interest and
principal sums |
Unlimited |
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71-85 |
Aa |
Possesses adequate working capital. No
caution needed for credit transaction. It has above average (strong)
capability for payment of interest and principal sums |
Large |
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56-70 |
A |
Financial & operational base are
regarded healthy. General unfavourable factors will not cause fatal effect.
Satisfactory capability for payment of interest and principal sums |
Fairly Large |
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41-55 |
Ba |
Overall operation is considered normal.
Capable to meet normal commitments. |
Satisfactory |
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26-40 |
B |
Unfavourable & favourable factors
carry similar weight in credit consideration. Capability to overcome
financial difficulties seems comparatively below average/normal. |
Small |
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11-25 |
Ca |
Adverse factors are apparent. Repayment of
interest and principal sums in default or expected to be in default upon
maturity |
Limited with full security |
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<10 |
C |
Absolute credit risk exists. Caution
needed to be exercised |
Credit not recommended |