MIRA INFORM REPORT

 

 

Report Date :

20.07.2007

 

IDENTIFICATION DETAILS

 

Name :

PENTA-OCEAN CONSTRUCTION CO LTD

 

 

Registered Office :

2-2-8 Koraku Bunkyoku Tokyo 112-8576

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2007

 

 

Date of Incorporation :

Apr 1950

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Marine civil engineering works

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Maximum Credit Limit :

Yen 4049.1 millions

 

 

Status :

Satisfactory

 

 

Payment Behaviour :

Regular

 

 

Litigation :

--

 

 

name

 

PENTA-OCEAN CONSTRUCTION CO LTD

 

 

REGD NAME

 

Goyo Kensetsu KK

 

 

MAIN OFFICE

 

2-2-8 Koraku Bunkyoku Tokyo 112-8576 JAPAN

Tel        : 03-3816-7111

Fax       : 03-3817-7642

URL      : http://www.penta-ocean.co.jp/

E-Mail address: (through the URL)

 

 

ACTIVITIES

 

Marine civil engineering works

 

 

BRANCHES

 

Sapporo, Yokohama, Osaka, Hiroshima, Fukuoka, other (Tot 98)

 

 

OVERSEAS

 

Singapore, Hong Kong, Indonesia, Malaysia, Egypt, Colombo, Manila, Bangkok, Hanoi, Myanmar, Micronesia, Phnom Penh, Dubai, Taiwan

 

 

CHIEF EXEC

 

YOSHIO MURASHIGE, PRES & CEO

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                             A/SALES          Yen 323,264 M

PAYMENTS      REGULAR                     CAPITAL           Yen 28,070 M

TREND             SLOW                          WORTH            Yen 57,605 M

STARTED         1950                             EMPLOYES      3,464

 

COMMENT

 

MARINE CIVIL ENGINEERING WORKS.  FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

           

MAX CREDIT LIMIT: YEN 4,049.1 MILLION, 30 DAYS NORMAL TERMS.

 

                        Forecast (or estimated) figures for 31/03/2008 fiscal term

 

 

HIGHLIGHTS

 

The subject company was established originally in 1896 in Kure by Jinjiro Mizuno, as Mizuno Gumi, in order to engage in reclamation and seawall construction works, on his account.  Won reputation as master marine engineering firm which led the firm to be marine civil engineering firm.  A pioneer in large-scale waterfront projects overseas and earned reputation for technology in Suez Canal construction.  Tops in water-front dredging works.  Aiming at becoming general contractor by bolstering building construction div.  The firm is shifting overseas operations from Mid East to Asia.  Jobs were slashed particularly in Singapore and Hong Kong.   With cuts continuing for domestic public works projects, the firm is focusing on finding work abroad.

 

(Reported)  The firm built an artificial tideland in Kuwait jointly with other firms to test the water purification capacity of reeds.  Reeds will be planted in the tideland to discover the optimal conditions for water purification.  Test results will be presented to the Kuwait government.  The project was requested by Japan’s Ministry of Economy, Trade & Industry, and will be fully funded by the Japan External Trade Organization.  Reports cited from The Nikkei Business Daily dated 15/June/2007.

           

 

FINANCIAL INFORMATION

 

The sales volume for Mar/7fiscal term amounted to Yen 323,264 million, an 8.9% drop from Yen 354,657 million in the previous term.  Works in private sector was solid, but affect of bid-rigging scandal on public works of Defense Facility Administration Agency was heavy, still remaining a key concern.  By divisions, construction was down by 8.5% to Yen 287,500 million (domestic down by 7.8%, while overseas up by 31.2%).  Domestic work completion decreased with profitability down due to hike in materials & fuel costs.  The recurring profit was posted at Yen 2,078 million, resulting in Yen 5,858 million net losses for the term.  Extraordinary losses are registered: Yen 8,678 million development work losses; Yen 7,955 million real assets assessment losses, etc.  This compares with Yen 11,341 million recurring profit and Yen 3,875 million net profit, respectively, a year ago.

 

For the current term ending Mar 2008 the recurring profit is projected at Yen 6,500 million and the net profit at Yen 2,000 million, respectively, on a 14.5% recovery in turnover, to Yen 370,000 million.  First quarter results to 30/06/2006 released: sales Yen 47,242 million (up 17.1), recurring loss Yen 3,361 million, net loss Yen 2,164 million.  Losses will be recovered by the completion of works.  Works for private sector will likely be solid.  Works in Haneda Airport may contribute (totaling Yen 16,000 million).

 

The financial situation is considered maintained FAIR and good for ORDINARY business engagements.  Max credit limit is estimated at Yen 4,049.1 million, on 30 days normal terms.

 

REGISTRATION

           

Date Registered:            Apr 1950

Legal Status:                 Limited Company (Kabushiki Kaisha)

Authorized:                    599,135,000 shares

Issued:                          491,527,820 shares

Sum:                            Yen 28,070 million

Major shareholders (%): Japan Trustee Services Bank, T (4.4), Mizuho Corporate Bank       (2.8), Japan Securities Finance (2.8), Meiji Yasuda Life Ins (2.7), Sompo Japan Ins (2.4), Bank of New York GCM Client (2.4), Trust & Custody Services, Trust (2.2), Master Trust Bank of Japan, T (2.0), Tokio Marine & Nichido Fire Ins (1.6), HSBC Bank Clients Nontax Treaty 740 (1.5); foreign owners (9.4)

No. of shareholders:       48,993

Listed on the S/Exchange (s) of: Tokyo, Osaka, Nagoya

Managements: Yoshio Murashige, pres; Kazuyuki Kawakami, rep dir; Hayuru Tsuda, rep dir; Jun’ichi Kamise, dir; Kosuke Kondo, dir; Yoshihisa Takimoto, dir; Masafumi Saito, dir; Yoshihisa Tomoda, dir

           

Nothing detrimental is known as to the commercial morality of executives.

 

 

Related companies

 

Penta-Ocean Dredging, Yoshin Construction, Penta Builders, other (Tot     27 as of Mar/07)

           

 

OPERATION

 

Activities: Civil engineering works: construction (96%), real estate development (1%), others (3%).  Overseas sales ratio 11.4%: Asia 10.4%, others 1%).

 

Clients: Municipal offices, government & public agencies, business firms, other

 

No. of accounts: 2,000

 

Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Itochu Corp, Mitsubishi Corp, Sojitz Corp, Mitsui & Co, Marubeni Corp, other.

 

Payment record: Regular

 

Location: Business area in Tokyo.  Office premises at the caption address are owned and maintained satisfactorily.

 

 

Bank References

 

Mizuho Corporate Bank (H/O)

Resona Bank (Tokyo)

 

Relations: Satisfactory

 

 

FINANCES

(Consolidated in million yen)

 

　

　

Terms Ending:

31/03/2007

31/03/2006

INCOME STATEMENT

 

 

 

  Annual Sales

　

323,264

354,657

 

  Cost of Sales

299,498

320,398

 

      GROSS PROFIT

23,766

34,258

 

  Selling & Adm Costs

19,122

20,081

 

      OPERATING PROFIT

4,644

14,176

 

  Non-Operating P/L

-2,566

-2,835

 

      RECURRING PROFIT

2,078

11,341

　

      NET PROFIT

-5,858

3,875

BALANCE SHEET

 

 

 

 

  Cash

　

49,247

64,873

 

  Receivables

 

122,088

108,409

 

  Inventory

 

18,728

36,458

 

  Securities, Marketable

102

91

 

  Other Current Assets

59,619

67,867

 

      TOTAL CURRENT ASSETS

249,784

277,698

 

  Property & Equipment

63,950

67,971

 

  Intangibles

 

589

532

 

  Investments, Other Fixed Assets

40,746

43,165

 

      TOTAL ASSETS

355,069

389,366

 

  Payables

 

113,136

110,201

 

  Short-Term Bank Loans

63,847

80,704

 

　

 

　

　

 

  Other Current Liabs

58,731

57,689

 

      TOTAL CURRENT LIABS

235,714

248,594

 

  Debentures

 

　

　

 

  Long-Term Bank Loans

46,615

54,995

 

  Reserve for Retirement Allw

7,015

7,202

 

  Other Debts

　

8,119

11,675

 

      TOTAL LIABILITIES

297,463

322,466

 

      MINORITY INTERESTS

 

8

 

Common stock

28,070

28,070

 

Additional paid-in capital

20,106

20,106

 

Retained earnings

4,102

9,939

 

Evaluation p/l on investments/securities

4,276

7,724

 

Others

 

1,066

1,065

 

Treasury stock, at cost

(15)

(13)

 

      TOTAL S/HOLDERS` EQUITY

57,605

66,891

　

      TOTAL EQUITIES

355,069

389,366

CONSOLIDATED CASH FLOWS

 

 

 

 

Terms ending:

31/03/2007

31/03/2006

 

Cash Flows from Operating Activities

　

4,721

9,771

 

Cash Flows from Investment Activities

5,558

2,319

 

Cash Flows from Financing Activities

-25,670

-14,965

　

Cash, Bank Deposits at the Term End

　

49,124

64,677

ANALYTICAL RATIOS            Terms ending:

31/03/2007

31/03/2006

 

 

Net Worth (S/Holders' Equity)

57,605

66,891

 

 

Current Ratio (%)

105.97

111.71

 

 

Net Worth Ratio (%)

16.22

17.18

 

 

Recurring Profit Ratio (%)

0.64

3.20

 

 

Net Profit Ratio (%)

-1.81

1.09

 

 

Return On Equity (%)

-10.17

5.79

 

 

RATING EXPLANATIONS

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

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

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

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.

 

Small

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

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

NR

In view of the lack of information, we have no basis upon which to recommend credit dealings

No Rating

 

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

 

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions