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MIRA
INFORM REPORT
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Report Date : |
8th
February, 2007 |
IDENTIFICATION
DETAILS
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Name : |
ELEKTRISOLA (MALAYSIA) SDN BHD |
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Registered Office : |
Jalan Damai Satu, Janda Baik, 28750 Bentong, Pahang, Malaysia. |
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Country : |
Malaysia |
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Financials (as on) : |
31.12.2005 |
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Date of Incorporation : |
07/02/1990 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturer
of Copper Wires. |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal.
Capable to meet normal commitments. |
Satisfactory |
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Status : |
Satisfactory |
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Payment Behaviour : |
Usually
Correct |
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Litigation : |
Clear |
EXECUTIVE SUMMARY
COMPANY NAME : ELEKTRISOLA (MALAYSIA) SDN BHD
FORMER NAME : N/A
INCORPORATION DATE : 07/02/1990
COMPANY STATUS : EXIST
LEGAL STATUS : PRIVATE LIMITED COMPANY
LISTED STATUS : NO
REGISTERED ADDRESS : JALAN DAMAI SATU, JANDA BAIK, 28750 BENTONG, PAHANG,
MALAYSIA.
BUSINESS ADDRESS : JLN DAMAI SATU, JANDA BAIK, 28750 BENTONG, PAHANG,
MALAYSIA.
TEL NO : 09 - 2210888
FAX NO : 09 - 2210800
CONTACT PERSON : THILO JOCHEN WESTERHAUSEN (EXECUTIVE DIRECTOR)
INDUSTRY CODE : 28992
PRINCIPAL ACTIVITY : TO PRODUCE AND TRADE IN MAGNET WIRE
AUTHORISED CAPITAL : MYR100,000,000.00 DIVIDED INTO
ORDINARY SHARE 100,000,000 OF MYR1.00 EACH.
ISSUED & PAID UP CAPITAL : MYR48,000,000.00 DIVIDED INTO
ORDINARY SHARE 48,000,000 CASH OF MYR1.00 EACH.
SALES : MYR247,083,524 [2005]
NET WORTH : MYR131,074,605 [2005]
STAFF STRENGTH : 900 [2007]
BANKER (S) : CIMB BANK BERHAD
LITIGATION : CLEAR
FINANCIAL CONDITION : FAIR
PAYMENT : AVERAGE
MANAGEMENT CAPABILITY : AVERAGE
COMMERCIAL RISK : MODERATE
CURRENCY EXPOSURE : HIGH
GENERAL REPUTATION : SATISFACTORY
INDUSTRY OUTLOOK : DECLINING
CREDIT RATING : Ba (please refer to appendix)
HISTORY / BACKGROUND
The SC is a private limited company and is allowed to have a minimum of one and a maximum of forty-nine shareholders. As a private limited company, the SC must have at least two directors. A private limited company is a separate legal entity from its shareholders. As a separate legal entity, the SC is capable of owning assets, entering into contracts, sue or be sued by other companies. The liabilities of the shareholders are to the extent of the equity they have taken up and the creditors cannot claim on shareholders' personal assets even if the SC is insolvent. The SC is governed by the Companies Act, 1965 and the company must file its annual returns, together with its financial statements with the Registrar of Companies.
The SC is principally engaged in the (as a / as an) to produce and trade in magnet wire.
The SC is not listed on Bursa Malaysia (Malaysia Stock Exchange).
The SC is not qualified to be one of the Top Corporate Performers in the Malaysia 1000 (M1000) publication, a directory jointly published by Companies Commission of Malaysia (The Registrar Office), Minister of Domestic Trade and Consumer Affairs and our publication arm, BASIS Publications House Sdn Bhd.
The major shareholder(s) of the SC are shown as follows :
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Name |
Address |
IC/PP/Loc No: |
Shareholding |
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DR SCHILDBACH FINANZ-GMBH |
HRB 1553 INDER HUTTENWIESE, 51574, WEST GERMANY |
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48,000,000 |
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48,000,000 |
+ Also Director
DIRECTORS
DIRECTOR 1
Name of Subject : ZAINAL ABIDIN BIN JAMAL
Address : 4 JALAN 2, TAMAN SRI UKAY, 68100 BATU CAVES, SELANGOR,
MALAYSIA.
IC / PP No : A1889493
New IC No : 540225-71-5355
Date of Birth : 25/02/1954
Nationality : MALAYSIAN
Date of Appointment : 07/02/1990
Qualification :
HE READ LAW AT THE UNIVERSITY OF SINGAPORE
WHERE HE
GRADUATED WITH
LLB (HONS) IN 1979.
Working Experience : HE WAS AN ADVOCATE AND SOLICITOR OF THE HIGH COURT OF
MALAYA , ADVOCATE & SOLICITOR OF THE SUPREME COURT OF
SINGAPORE IN 1980 AND THE HIGH COURT OF BRUNEI IN 1982 AND
HAD SERVED AS A FIRST CLASS MAGISTRATE IN THE JUDICIAL
DEPARTMENT,BRUNEI. HE WAS COMPANY SECRETARY OF HARRISON
MALAYSIAN PLANTATIONS BERHAD.
Other Info : MEMBER OF THE RATING REVIEW COMMITTEE OF MALAYSIAN RATING
CORPORATION BERHAD SINCE 16 OCTOBER 1996 , MEMBER OF THE
AUDIT COMMITTEE.
DIRECTOR 2
Name of Subject : DR DETLEF SCHILDBACH
Address : AM FEHLBERG 29, REICHSHOF-ECKENHAGEN, D51580, WEST
GERMANY.
IC / PP No : P5335093574
Nationality : GERMAN
Date of Appointment : 24/08/1990
DIRECTOR 3
Name of Subject : DR OLIVER SCHILDBACH
Address : WARTHSRABE 47, D51674 WIEHL, WEST GERMANY.
IC / PP No : P5337125279
Nationality : GERMAN
Date of Appointment : 24/08/1990
DIRECTOR 4
Name of Subject : THILO JOCHEN WESTERHAUSEN
Address : JALAN DAMAI SATU, JANDA BAIK, 28750 BENTONG, PAHANG,
MALAYSIA.
IC / PP No : P3326028529
Nationality : N/A
Date of Appointment : 21/05/1992
MANAGEMENT
1) Name of Subject : THILO JOCHEN WESTERHAUSEN
Position : EXECUTIVE DIRECTOR
2) Name of Subject : KHAIRI
Position : FINANCE MANAGER
AUDITOR
Auditor : PRICEWATERHOUSECOOPERS
Auditors' Address : WISMA SIME DARBY, JALAN RAJA LAUT, 11TH FLOOR, 50350 KUALA
LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
COMPANY SECRETARY
1)Company Secretary : SEE SIEW CHENG
IC / PP No. : A0735809
New IC No. : 670505-10-5880
Address : 17 JALAN ARA SD 7/4G, BANDAR SRI DAMANSARA, 52200
KUALA LUMPUR, SELANGOR, MALAYSIA.
BANKING
Banking relations are maintained principally with :
1) Banker Name : CIMB BANK BERHAD
The SC enjoys normal banking routine with above mentioned banker(s).
No adverse record was found during our investigation.
ENCUMBRANCE (S)
ENCUMBRANCE 1
Date of Creation : 15 Jun 1994
Description of Charge : FIXED AND FLOATING CHARGE
Amount Secured : RM 6,000,000.00
Description of Property Affected : N/A
Name & Address of Chargee : BANK OF COMMERCE (M) BHD
6 JLN TUN PERAK, 50050 KUALA LUMPUR.
Form 40 Dated 15 Jun 1994
Registered and Numbered 1 In The Register of Charges
ENCUMBRANCE 2
Date of Creation : 15 Jun 1994
Description of Charge : FIXED AND FLOATING CHARGE
Amount Secured : RM 4,000,000.00
Description of Property Affected : N/A
Name & Address of Chargee : HONGKONG BANK (M) BHD
6 JLN TUN PERAK, 50050 KUALA LUMPUR.
Form 40 Dated 15 Jun 1994
Registered and Numbered 2 In The Register of Charges
LEGAL CHECK AGAINST THE SC
*A check has been conducted in our databank against the SC whether the subject has been involved in any litigation. Our databank consists of 99% of the wound up companies in Malaysia back dated since 1900.
No legal action was found in our databank.
No winding up petition was found in our data bank
PAYMENT RECORD
SOURCES
OF RAW MATERIALS :
Local : YES Percentage : 80%
Overseas : YES Percentage : 20%
Import Countries : EUROPE.
The SC refused to provide any name of trade/service supplier and we are unable to conduct any trade enquiry. However, from financial historical data we conclude that :
OVERALL
PAYMENT HABIT
Prompt [ ] Good [ ] Average [ X ]
Fair [ ] Poor [ ]
CLIENTELE
Local : YES Percentage : 5%
Domestic Markets : MALAYSIA.
Overseas : YES Percentage : 95%
Export Market : ASIA.
Credit Term : 30 - 60 DAYS.
Payment Mode : CHEQUES , TELEGRAPHIC TRANSFER (TT).
Type of Customer : ELECTRICAL & ELECTRONIC INDUSTRIES , TELECOMMUNICATION
INDUSTRY .
OPERATIONS
Products Manufactured : COPPER WIRES
Award : 1 ) ISO/ TS 16949 : 2002 Year : 2004
2 ) MS ISO 14001 Year : 2002
Competitor(s) : SOUTH MALAYSIA INDUSTRIES BHD
FE MAGNET WIRE (MALAYSIA) SDN BHD
KISWIRE SDN BHD
METROD (MALAYSIA) BHD
FUJIKURA (MALAYSIA) SDN BHD
Total Number of Employees :
YEAR 2007
GROUP N/A
COMPANY 900
Branch : NO
RECENT DEVELOPMENT
We have checked with the Malaysian National News Agency's (BERNAMA) database, but no latest development was noted in our investigation.
CURRENT INVESTIGATION
Latest fresh investigations carried out on the SC indicated that :
Telephone Number Provided By Client : 09-2210888
Current Telephone Number : 09-2210888
Match : YES
Address Provided By Client : JALAN DAMAI SATU, JANDA BAIK, 28750 BENTONG,
PAHANG.
Current Address : JLN DAMAI SATU, JANDA BAIK, 28750 BENTONG,
PAHANG, MALAYSIA.
Match : YES
Latest Financial Accounts : YES
Other Investigations
On 5th February 2007 we contacted Mr Khairi, the SC's Finance Manager. He furnished some information on the SC.
FINANCIAL COMMENTS
Profitability :
Turnover : Increased [ 2003-2005 ]
Profit / ( Loss ) before tax : Increased [ 2003-2005 ]
Return on Shareholder Funds : Acceptable [ 22.00% ]
Return on Net Assets : Acceptable [ 14.74% ]
The SC's turnover increased steadily as the demand for its products / services increased due to the goodwill built up over the years. The higher profit could be attributed to the increase in turnover. The SC's management had generated acceptable return for its shareholders using its assets.
Working Capital Control :
Stocks Ratio : Unfavourable [ 99 Days ]
Debtors Ratio : Acceptable [ 62 Days ]
Creditors Ratio : Favourable [ 30 Days ]
The SC could be incurring higher holding cost. As its capital was tied up in stocks, it could face liquidity problems. The SC's management was quite efficient in handling its debtors. The SC's debtors days were at an acceptable range, thus the risk of its debts turning bad was minimised. The SC had a favourable creditors' ratio as evidenced by its favourable collection days. The SC could be taking advantage of the cash discounts and also wanting to maintain goodwill with its creditors.
Liquidity :
Liquid Ratio : Unfavourable [ 0.55 Times ]
Current Ratio : Unfavourable [ 1.15 Times ]
A low liquid ratio means that the SC may be facing working capital deficiency. If the SC cannot obtain additional financing or injection of fresh capital, it may face difficulties in meeting its short term obligations.
Solvency :
Interest Cover : Acceptable [ 6.19 Times ]
Gearing Ratio : Favourable [ 0.12 Times ]
The SC's interest cover was slightly low. If there is no sharp fall in its profit or sudden increase in the interest rates, we believe the SC is able to generate sufficient income to service its interest and repay the loans. The SC was lowly geared thus it had a low financial risk. The SC was mainly financed by its shareholders' funds and internally generated funds. In times of economic slowdown / downturn, the SC being a lowly geared company, will be able to compete better than those companies which are highly geared in the same industry.
Overall Assessment :
Generally, the SC's performance has improved with higher turnover and profit.Due to its weak liquidity position, the SC will be faced with problems in meeting all its short term obligations if no short term loan is obtained or additional capital injected into the SC.The SC had an acceptable interest cover. If there is no sudden sharp increase in interest rate or fall in the SC's profit, we do believe the SC is able to generate sufficient cash flow to service its interest payment.The SC, as a lowly geared company, will be more secured compared to those highly geared companies. It has the ability to meet all its long term obligations.
Overall financial condition of the SC:
FAIR
COMMENTS
Established in 1990 as a private limited company, the SC is principally engaged in the production and trading of magnet wire. With a huge issued and paid up capital of RM48 million, the SC is a fairly large company with over 16 years of experience in the business.
Over the years, the SC's business has expanded steadily in the international arena. As part of its global marketing strategy, the SC's main focus in on the overseas countries as exports contribute approximately to 95% of its total sales. We noted that the SC's products are highly demanded in electrical & electronic and telecommunication industries. As the SC's products are used in myriad of businesses, it eliminates the risk of dependency on one business line. Currently, with a manpower strength of 900 employees, the SC's management is led by its Executive Director, Thilo Jochen Westerhausen.
During the financial year 2005, the SC's turnover grew 21.33% from RM203,640,759 to RM247,083,524.
Its pre-tax profit rose in tandem by 76.19% to RM29,033,738 compared to RM16,478,294 previously. Return on shareholders' funds of the SC is high at 22% which indicated that the management was efficient in utilising its funds to generate income. However, due to low liquidity position, the SC may face working capital deficiency in meeting its short term financial obligations. Being a lowly geared company, the SC has low financial risk as it is mainly dependent on its internal funds to finance its business needs.
Overall, the SC's financial standing is fair.
Investigation revealed that the SC's raw materials are sourced locally and imported from Europe. As the SC is an export oriented company, its forex exposure is high. A small movement in currency exchange rates would result in a change in operating profit or costs.
Based on the historical financial data, we concluded that the SC's payment record is average. The SC is clear of litigation.
The SC's growth is largely determined by the electrical & electronic and telecommunication industries. As both industry is rapidly expanding, we believe that the SC should be able to further enhance its business in the near terms.
In view of the above, we recommend credit be granted to the SC normally.
THE FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIA ACCOUNTING STANDARD.
PROFIT AND LOSS ACCOUNT
For The Year Ended 31-December-2005
2005 2004 2003
MYR MYR MYR
TURNOVER 247,083,524 203,640,759 133,385,929
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PROFIT/(LOSS) FROM OPERATIONS 29,033,738 16,478,294 6,100,134
SHARE
OF PROFITS/(LOSSES) OF ASSOCIATED
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PROFIT/(LOSS)
BEFORE TAXATION 29,033,738 16,478,294 6,100,134
Taxation <194,362> <182,729> <96,730>
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PROFIT/(LOSS)
AFTER TAXATION 28,839,376 16,295,565 6,003,404
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PROFIT/(LOSS)
BEFORE EXTRAORDINARY ITEMS 28,839,376 16,295,565 6,003,404
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PROFIT/(LOSS)
ATTRIBUTABLE TO SHAREHOLDERS 28,839,376 16,295,565 6,003,404
RETAINED
PROFIT/(ACCUMULATED LOSS) BROUGHT
FORWARD
As previously reported 54,235,229 37,939,664 31,936,260
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As restated 54,235,229 37,939,664 31,936,260
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PROFIT
AVAILABLE FOR APPROPRIATIONS 83,074,605 54,235,229 37,939,664
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RETAINED
PROFIT/(ACCUMULATED LOSS) CARRIED
FORWARD 83,074,605 54,235,229 37,939,664
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RETAINED BY:
The Company 83,074,605 54,235,229 37,939,664
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83,074,605 54,235,229 37,939,664
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INTEREST
EXPENSE (as per notes to P&L)
Term loan 922,500 - -
Bank overdraft 39,295 - -
Loans from related companies 4,154,508 - -
Bankers' acceptance & other borrowings 477,403 - -
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5,593,706 - -
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BALANCE SHEET
As At 31-December-2005
2005 2004 2003
MYR MYR MYR
ASSETS
EMPLOYED:
FIXED
ASSETS 213,840,239 222,558,069 174,286,015
LONG
TERM INVESTMENTS/OTHER ASSETS
Deferred assets 4,162,251 4,340,776 4,539,471
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TOTAL
LONG TERM INVESTMENTS/OTHER ASSETS 4,162,251 4,340,776 4,539,471
INTANGIBLE
ASSETS
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TOTAL
LONG TERM ASSETS 218,002,490 226,898,845 178,825,486
CURRENT
ASSETS
Stocks 66,775,048 56,495,889 42,350,963
Trade debtors 42,280,673 27,484,199 24,299,032
Other debtors, deposits & prepayments 3,984,637 4,582,337 4,590,830
Items in transit between head office &
branches
Amount due from related companies 8,995,063 8,560,037 5,852,025
Cash & bank balances 6,243,132 2,608,708 2,242,244
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TOTAL
CURRENT ASSETS 128,278,553 99,731,170 79,335,094
CURRENT
LIABILITIES
Trade creditors 20,628,656 8,845,910 6,013,062
Other creditors & accruals 8,861,025 9,913,664 9,731,008
Bank overdraft 265,582 - -
Short term borrowings/Term loans 15,000,000 40,229,409 53,955,000
Bill & acceptances payable 412,000 - -
Amounts owing to holding company 132,874 - -
Amounts owing to related companies 4,257,863 48,834,438 37,182,604
Provision for taxation 9,537 - 25,392
Loan from related companies 61,828,386 - -
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TOTAL
CURRENT LIABILITIES 111,395,923 107,823,421 106,907,066
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NET
CURRENT ASSETS/(LIABILITIES) 16,882,630 <8,092,251> <27,571,972>
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TOTAL
NET ASSETS 234,885,120 218,806,594 151,253,514
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FINANCED
BY:
SHARE
CAPITAL
Ordinary share capital 48,000,000 48,000,000 48,000,000
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TOTAL
SHARE CAPITAL 48,000,000 48,000,000 48,000,000
RESERVES
Retained profit/(Accumulated loss) carried
forward 83,074,605 54,235,229 37,939,664
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TOTAL
RESERVES 83,074,605 54,235,229 37,939,664
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SHAREHOLDERS'
FUNDS/EQUITY 131,074,605 102,235,229 85,939,664
LONG
TERM & DEFERRED LIABILITIES & PROVISIONS
Long term loans - 15,000,000 15,000,000
Loan from related companies 103,810,515 101,571,365 50,313,850
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TOTAL LONG TERM & DEFERRED LIABILITIES
&
PROVISIONS 103,810,515 116,571,365 65,313,850
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234,885,120 218,806,594 151,253,514
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FINANCIAL RATIOS
As At 31-December-2005
2005 2004 2003
MYR MYR MYR
TYPES
OF FUNDS
Cash 6,243,132 2,608,708 2,242,244
Net Liquid Funds <9,022,450> <37,620,701> <51,712,756>
Net Liquid Assets <49,892,418> <64,588,140> <69,922,935>
Net Current Assets/(Liabilities) 16,882,630 <8,092,251> <27,571,972>
Net Tangible Assets 234,885,120 218,806,594 151,253,514
Net Monetary Assets <153,702,933> <181,159,505> <135,236,785>
BALANCE
SHEET ITEMS
Total Borrowings 15,265,582 55,229,409 68,955,000
Total Liabilities 215,206,438 224,394,786 172,220,916
Total Assets 346,281,043 326,630,015 258,160,580
Net Assets 234,885,120 218,806,594 151,253,514
Net Assets Backing 131,074,605 102,235,229 85,939,664
Shareholders'' Funds 131,074,605 102,235,229 85,939,664
Total Share Capital 48,000,000 48,000,000 48,000,000
Total Reserves 83,074,605 54,235,229 37,939,664
LIQUIDITY
(Times)
Cash Ratio 0.06 0.02 0.02
Liquid Ratio 0.55 0.40 0.35
Current Ratio 1.15 0.92 0.74
WORKING
CAPITAL CONTROL (Days)
Stock Ratio 99 101 116
Debtors Ratio 62 49 66
Creditors Ratio 30 16 16
SOLVENCY
RATIOS (Times)
Gearing Ratio 0.12 0.54 0.80
Liabilities Ratio 1.64 2.19 2.00
Times Interest Earned Ratio 6.19 0 0
PERFORMANCE
RATIO (%)
Operating Profit Margin 11.75 8.09 4.57
Net Profit Margin 11.67 8.00 4.50
Return On Net Assets 14.74 7.53 4.03
Return On Capital Employed 13.84 6.36 2.97
Return On Shareholders'' Funds/Equity 22.00 15.94 6.99
Dividend Pay Out Ratio (Times) 0 0 0
NOTES
TO ACCOUNTS
Contingent Liabilities 0 0 0
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 |
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NR |
In view of the lack of information, we
have no basis upon which to recommend credit dealings |
No Rating |
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