MIRA
INFORM REPORT
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Report Date : |
9th March, 2007 |
IDENTIFICATION
DETAILS
|
Name : |
SINLYGWAN
ENTERPRISE SDN BHD |
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Registered Office : |
13-7a, The Boulevard, Mid Valley City. Lingkaran Syed, Putra, 59200 Kuala Lumpur, Malaysia. |
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Country : |
Malaysia |
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Financials (as on) : |
31.12.2005 |
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Date of Incorporation : |
24.02.1990 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Trading in fastener product and machinery |
RATING &
COMMENTS
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MIRA’s Rating : |
Ca |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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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Status : |
Moderate |
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Payment Behaviour : |
Slow |
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Litigation : |
Clear |
EXECUTIVE SUMMARY
LOCAL NO : 193983-W
COMPANY NAME : SINLYGWAN ENTERPRISE SDN BHD
FORMER NAME : N/A
INCORPORATION DATE : 24/02/1990
COMPANY STATUS : EXIST
LEGAL STATUS : PRIVATE LIMITED COMPANY
LISTED STATUS : NO
REGISTERED ADDRESS : 13-7A, THE BOULEVARD, MID VALLEY CITY. LINGKARAN
SYED, PUTRA, 59200 KUALA LUMPUR, MALAYSIA.
BUSINESS ADDRESS : LOT 11543, JLN TAMAN IMPIAN EHSAN, 43300 SERI
KEMBANGAN, SELANGOR, MALAYSIA.
TEL NO : 03 - 89617204
FAX NO : 03 - 89610648
CONTACT PERSON : LEE KOK SENG (MANAGING DIRECTOR)
INDUSTRY CODE : 51591 51432
PRINCIPAL ACTIVITY : TRADING IN FASTENER PRODUCT AND MACHINERY
AUTHORISED CAPITAL : MYR300,000.00 DIVIDED INTO
ORDINARY SHARE 300,000 OF MYR1.00 EACH.
ISSUED AND PAID UP CAPITAL : MYR250,000.00 DIVIDED INTO
ORDINARY SHARE 250,000 CASH OF MYR1.00 EACH.
SALES : MYR6,596,742 [2005]
NET WORTH : MYR235,517 [2005]
STAFF STRENGTH : 8 [2007]
BANKER (S) : HONG LEONG BANK BHD
: BUMIPUTRA-COMMERCE BANK BHD
: PUBLIC BANK BHD
LITIGATION : CLEAR
FINANCIAL CONDITION : POOR
PAYMENT : POOR
MANAGEMENT CAPABILITY : AVERAGE
COMMERCIAL RISK : MODERATE
CURRENCY EXPOSURE : HIGH
GENERAL REPUTATION : SATISFACTORY
INDUSTRY OUTLOOK : MARGINAL GROWTH
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) trading in fastener
product and machinery.
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 :
|
Name |
Address |
IC/PP/Loc No: |
Shareholding |
|
LEE SIU YET + |
106, BATU 11, CHERAS, 43200 CHERAS, SELANGOR, MALAYSIA. |
A1637552 700820-10-5148 |
127,500.00 |
|
CHANG TSAE TWU + |
2, JALAN SL 2/5A, BANDAR SUNGAI LONG BATU 9, CHERAS, 43200 CHERAS,
SELANGOR, MALAYSIA. |
650929-67-5088 |
122,500.00 |
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250,000 |
+ Also Director
DIRECTORS
DIRECTOR 1
Name of Subject : MS. LEE SIU YET
Address : 106, BATU 11, CHERAS, 43200 CHERAS, SELANGOR, MALAYSIA.
IC / PP No : A1637552
New IC No : 700820-10-5148
Date of Birth : 20/08/1970
Nationality : MALAYSIAN CHINESE
DIRECTOR 2
Name of Subject : MS. CHANG TSAE TWU
Address : 2, JALAN SL 2/5A, BANDAR SUNGAI LONG, BATU 9, CHERAS,
43200 CHERAS, SELANGOR, MALAYSIA.
IC / PP No : N/A
New IC No : 650929-67-5088
Date of Birth : 29/09/1965
Nationality : MALAYSIAN CHINESE
DIRECTOR 3
Name of Subject : MR. LEE KOK SENG
Address : 2, JALAN SL 2/5A, BANDAR SUNGAI LONG, BATU 9, CHERAS,
43200 CHERAS, SELANGOR, MALAYSIA.
IC / PP No : A0276753
New IC No : 650330-10-5943
Date of Birth : 30/03/1965
Nationality : MALAYSIAN CHINESE
MANAGEMENT
1) Name of Subject : LEE KOK SENG
Position : MANAGING DIRECTOR
AUDITOR
Auditor : SC LIM, NG & CO
Auditors' Address : 13-7, THE BOULEVARD, MID VALLEY CITY, LINGKARAN SYED PUTRA,
59200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
COMPANY SECRETARY
1) Company Secretary : MS. LIM LI CHUAN
IC / PP No. : 5509124
New IC No. : 580729-01-5156
Address : 22, LORONG JELAWAT 6, TAMAN SUNGAI ABONG, 84000
MUAR, JOHOR, MALAYSIA.
2) Company Secretary : MS. MARION LIM GAIK BEE
New IC No. : 770803-14-5758
Address : 8, LORONG IBU KOTA 4, TAMAN IBU KOTA, BATU 5, JALAN
GOMBAK, 53100 KUALA LUMPUR, WILAYAH PERSEKUTUAN,
MALAYSIA.
BANKING
Banking relations are maintained principally with :
1) Banker Name : HONG LEONG BANK BHD
2) Banker Name : BUMIPUTRA-COMMERCE BANK BHD
3) Banker Name : PUBLIC BANK BHD
The SC enjoys normal banking routine with above mentioned banker(s).
The SC has bank charges with above mentioned banker(s).
ENCUMBRANCE (S)
ENCUMBRANCE 1
Date of Creation : 25 Apr 1997
Description of Charge : CHARGE
Amount Secured : RM 910,000.00
Description of Property Affected : HS(M) 2431, PT 11542, MK KAJANG, SELANGOR
Name & Address of Chargee : BANK BUMIPUTRA MALAYSIA BHD
BLK B, BGN PUSAT PELAJAR, UNIVERSITI PERTANIAN
MALAYSIA, GRD FLR, 43400 SERDANG, SELANGOR.
Form 40 Dated 01 Jul 1997
Registered and Numbered 2 In The Register of Charges
ENCUMBRANCE 2
Date of Creation : 05 Jun 1997
Description of Charge : CHARGE
Amount Secured : RM 910,000.00
Description of Property Affected : HS(M) 2432, PT 11543, MK KAJANG, SELANGOR
Name & Address of Chargee : BANK BUMIPUTRA MALAYSIA BHD
BLK B, BGN PUSAT PELAJAR, UNIVERSITI PERTANIAN
MALAYSIA, GRD FLR, 43400 SERDANG, SELANGOR.
Form 40 Dated 07 Jul 1997
Registered and Numbered 3 In The Register of Charges
ENCUMBRANCE 3
Date of Creation : 06 May 1998
Description of Charge : AGREEMENT & 1ST PARTY 1ST CHARGE
Amount Secured : RM 650,000.00
Description of Property Affected : HS(M) 03242, PT 4129, MK SEMENYIH, DIST ULU LANGAT,
SELANGOR
Name & Address of Chargee : HONG LEONG BANK BHD
WISMA HONG LEONG, 18 JLN PERAK, LEVEL 5, 50450
KUALA LUMPUR.
Form 40 Dated 09 May 1998
Registered and Numbered 4 In The Register of Charges
ENCUMBRANCE 4
Date of Creation : 02 Jan 2002
Description of Charge : CHARGE
Amount Secured : RM 2,677,500.00
Description of Property Affected : HS(M) 2431, PT 11542, MK KAJANG, SELANGOR
Name & Address of Chargee : BUMIPUTRA-COMMERCE BANK BHD
WISMA HONG LEONG, 18 JLN PERAK, LEVEL 5, 50450
KUALA LUMPUR.
Form 40 Dated
Registered and Numbered 5 In The Register of Charges
ENCUMBRANCE 5
Date of Creation : 26 Jun 2006
Description of Charge : FACILITIES AGREEMENT, 1ST PARTY 1ST LEGAL CHARGE,
JOINT & SEVERAL GUARANTEE
Amount Secured : RM 450,000.00
Description of Property Affected : ALL THAT PIECE OF FREEEHOLD LAND HELD UNDER GRN
60020, LOT 3223, MUKIM LENGGENG, SEREMBAN NEGERI
SEMBILAN & MEASURING APPROXIMATE 2.6962 HECTARES
Name & Address of Chargee : PUBLIC BANK BHD
10 & 11, JALAN RAJA HAROUN, PO BOX 18, 43000 KAJANG,
SELANGOR, MALAYSIA.
Form 40 Dated 03 Aug 2006
Registered and Numbered 6 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 : NO Percentage : 0 %
Overseas : YES Percentage : 100%
Import Countries : TAIWAN.
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 [ ]
Fair [ ] Poor [ X ]
CLIENTELE
Local : YES Percentage : 70%
Domestic Markets : MALAYSIA.
Overseas : YES Percentage : 30%
Export Market : GERMANY , AUSTRALIA , UNITED STATES , SINGAPORE , THAILAND ,
INDONESIA.
Credit Term : 30 - 60 DAYS.
Payment Mode : CHEQUES , LETTER OF CREDIT (LC).
Type of Customer : CORPORATES , CONSTRUCTION INDUSTRY , AUTOMOTIVE
INDUSTRIES , HARDWARE SHOP , ELECTRICAL & ELECTRONIC
INDUSTRIES , STATIONERY SHOP , FURNITURE INDUSTRY , DEALERS .
OPERATIONS
Brand Name : SINLYGWAN
Ownership of premises : OWNED
Total Number of Employees :
YEAR 2007 2006 2005
GROUP N/A N/A N/A
COMPANY 8 8 10
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 : N/A
Current Telephone Number : 03-89617204
Match : N/A
Address Provided By Client : LOT 11543 JALAN TAMAN IMPIAM EHSAN
BALAKONG 43300 SERI KEMBANGAN SELANGOR
DAHRUL EHSAN MALAYSIA
Current Address : LOT 11543, JLN TAMAN IMPIAN EHSAN, 43300 SERI
KEMBANGAN, SELANGOR, MALAYSIA.
Match : YES
Latest Financial Accounts : YES
Other Investigations
On 2nd March 2007, we conducted an interview with one of the SC's staff from Human Resource Department. She provided some information on the SC.
Besides that, we conducted an interview with one of the SC's staff from Accounts Department. He revealed some relevant information on the SC.
FINANCIAL COMMENTS
Profitability :
Turnover : Increased [ 4.59% ]
Profit / ( Loss ) before tax : Increased [ 10.22% ]
Return on Shareholder Funds : Unfavourable [ 3.18% ]
Return on Net Assets : Acceptable [ 15.93% ]
The higher turnover could be attributed to the favourable market condition. The SC's management have been efficient in controlling its operating costs. The unfavourable return on shareholders' funds and net assets could indicate that the SC's management was inefficient in utilising its assets to generate returns.
Working Capital Control :
Stocks Ratio : Acceptable [ 60 Days ]
Debtors Ratio : Unfavourable [ 117 Days ]
Creditors Ratio : Unfavourable [ 208 Days ]
The SC kept adequate stocks to meet its normal business transactions without incurring excessive storage costs. The SC's debtors ratio was high. The SC should tighten its credit control and improve its collection period. The unfavourable creditors' ratio could be due to the SC taking advantage of the credit granted by its suppliers. However this may affect the goodwill between the SC and its suppliers and the SC may inadvertently have to pay more for its future supplies.
Liquidity :
Liquid Ratio : Unfavourable [ 0.60 Times ]
Current Ratio : Unfavourable [ 0.83 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 : Unfavourable [ 1.21 Times ]
Gearing Ratio : Unfavourable [ 6.20 Times ]
The SC's interest cover was low. If its profits fall or when interest rate rises, it may not be able to meet all its interest payment. The SC was highly geared, thus it had a high financial risk. The SC was dependent on loans to finance its business needs. In times of economic downturn and / or high interest rate, the SC will become less profitable and competitive than other firms in the same industry, which are lowly geared. This is because the SC has to service the interest and to repay the loan, which will erode part of its profits. The profits will fluctuate depending on the SC's turnover and the interest it needs to pay.
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.If there is a fall in the SC's profit or any increase in interest rate, the SC may not be able to generate sufficient cash-flow to service its interest.The SC's gearing level was high and its going concern will be in doubt if there is no injection of additional shareholders' funds in times of economic downturn and / or high interest rates.
Overall financial condition of the SC: POOR
COMMENTS
Established in 1990,
as a private limited company the SC is principally engaged in the trading in
fastener product and machinery. With its long presence in the industry coupled
with its vast experiences in the business, the SC should have built up a
certain goodwill with its client over times. At present the paid
up capital of the SC stands at RM250,000.
Our investigation
revealed that the SC serves both local and overseas clients. Penetrating into
the overseas countries such as Germany, Australia, United States, Singapore,
Thailand and Indonesia has well diversified its business risk and at the same
time added strength to its capabilities in capturing higher market shares. At
present the workforce of the SC is 8 and the group's business activities are
overseen by its Managing Director, Lee Kok Seng and its management capability
is average.
For the financial
year ended 31 December 2005, turnover of the SC grew by 4.59% to RM6,596,742.
The SC recorded a pre-tax profit of RM30,749 for the year, an increase of 10.22% over the previous
year. Return on shareholders' funds of the SC is relatively low, indicating
that the SC did not generate an acceptable amount of profits based on its
existing shareholders' funds. Beside this 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 has high gearing ratio and it may face financial difficulties if no
additional capital is injected. Overall the financial standing of the SC is
POOR.
We are aware that
all the SC's products are imported from Taiwan. Therefore, the SC is exposed to
the high currency fluctuation risk.
Based on our
historical financial data, the SC's payment is poor. The SC is clear of
litigation.
The industry is reaching its maturity stage and only
marginal growth is expected. With the
normal outlook of the industry performance, the SC has the ability to compete
with other players in the market to sustain its growth momentum.
In view of the above
and based on our assessment we recommend credit be granted to the SC with
guarantee.
THE FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIA ACCOUNTING STANDARD.
PROFIT AND LOSS ACCOUNT
For The Year Ended 31-December-2005
2005 2004
MYR MYR
TURNOVER 6,596,742 6,307,086
=========== ===========
PROFIT/(LOSS)
FROM OPERATIONS 30,749 27,897
SHARE OF PROFITS/(LOSSES) OF
ASSOCIATED
------------------- -------------------
PROFIT/(LOSS)
BEFORE TAXATION 30,749 27,897
Taxation <23,266> <7,528>
------------------- -------------------
PROFIT/(LOSS)
AFTER TAXATION 7,483 20,369
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PROFIT/(LOSS)
BEFORE EXTRAORDINARY ITEMS 7,483 20,369
------------------- -------------------
PROFIT/(LOSS)
ATTRIBUTABLE TO SHAREHOLDERS 7,483 20,369
RETAINED PROFIT/(ACCUMULATED LOSS)
BROUGHT
FORWARD
As
previously reported <21,966> <42,335>
------------------- -------------------
As
restated <21,966> <42,335>
------------------- -------------------
PROFIT
AVAILABLE FOR APPROPRIATIONS <14,483> <21,966>
------------------- -------------------
RETAINED PROFIT/(ACCUMULATED LOSS)
CARRIED
FORWARD <14,483> <21,966>
=========== ===========
RETAINED
BY: The Company <14,483> <21,966>
------------------- -------------------
<14,483> <21,966>
=========== ===========
INTEREST
EXPENSE (as per notes to P&L)
Bank
overdraft 19,952 18,795
Hire
purchase 7,972 10,560
trade
bill interest 118,553 85,669
------------------- -------------------
146,477 115,024
=========== ===========
BALANCE SHEET
As At 31-December-2005
2005 2004
MYR MYR
ASSETS EMPLOYED:
FIXED
ASSETS 1,935,565 2,012,780
------------------- -------------------
TOTAL
LONG TERM ASSETS 1,935,565 2,012,780
CURRENT
ASSETS
Stocks 1,083,552 842,644
Trade
debtors 2,119,149 2,531,682
Other debtors,
deposits & prepayments 717,204 1,522,092
Short
term deposits 57,002 -
Items in transit between head
office & branches
Cash
& bank balances 1,485 3,981
------------------- -------------------
TOTAL
CURRENT ASSETS 3,978,392 4,900,399
CURRENT
LIABILITIES
Trade
creditors 3,760,586 4,202,781
Other
creditors & accruals 451,781 1,118,043
Hire
purchase & lease creditors 29,524 29,208
Bank
overdraft 418,941 195,891
Short
term borrowings/Term loans 135,481 100,000
Provision
for taxation 5,154 -
------------------- -------------------
TOTAL
CURRENT LIABILITIES 4,801,467 5,645,923
------------------- -------------------
NET
CURRENT ASSETS/(LIABILITIES) <823,075> <745,524>
------------------- -------------------
TOTAL
NET ASSETS 1,112,490 1,267,256
=========== ===========
FINANCED
BY:
SHARE
CAPITAL
Ordinary
share capital 250,000 250,000
------------------- -------------------
TOTAL
SHARE CAPITAL 250,000 250,000
RESERVES
Retained
profit/(Accumulated loss) carried
forward <14,483> <21,966>
------------------- -------------------
TOTAL
RESERVES <14,483> <21,966>
------------------- -------------------
SHAREHOLDERS'
FUNDS/EQUITY 235,517 228,034
LONG
TERM & DEFERRED LIABILITIES & PROVISIONS
Long
term loans 248,787 407,646
Other
long term borrowings 567,073 542,959
Hire
purchase creditors 61,113 88,617
------------------- -------------------
TOTAL LONG TERM & DEFERRED
LIABILITIES &
PROVISIONS 876,973 1,039,222
------------------- -------------------
1,112,490 1,267,256
=========== ===========
FINANCIAL RATIOS
As At 31-December-2005
2005 2004
MYR MYR
TYPES OF FUNDS
Cash 58,487 3,981
Net
Liquid Funds <495,935> <291,910>
Net
Liquid Assets <1,906,627> <1,588,168>
Net
Current Assets/(Liabilities) <823,075> <745,524>
Net
Tangible Assets 1,112,490 1,267,256
Net
Monetary Assets <2,783,600> <2,627,390>
BALANCE
SHEET ITEMS
Total
Borrowings 1,460,919 1,364,321
Total
Liabilities 5,678,440 6,685,145
Total
Assets 5,913,957 6,913,179
Net
Assets 1,112,490 1,267,256
Net
Assets Backing 235,517 228,034
Shareholders''
Funds 235,517 228,034
Total
Share Capital 250,000 250,000
Total
Reserves <14,483> <21,966>
LIQUIDITY
(Times)
Cash
Ratio 0.01 0.00
Liquid
Ratio 0.60 0.72
Current
Ratio 0.83 0.87
WORKING
CAPITAL CONTROL (Days)
Stock
Ratio 60 49
Debtors
Ratio 117 147
Creditors
Ratio 208 243
SOLVENCY
RATIOS (Times)
Gearing
Ratio 6.20 5.98
Liabilities
Ratio 24.11 29.32
Times
Interest Earned Ratio 1.21 1.24
PERFORMANCE
RATIO (%)
Operating
Profit Margin 0.47 0.44
Net
Profit Margin 0.11 0.32
Return
On Net Assets 15.93 11.28
Return
On Capital Employed 10.45 8.98
Return
On Shareholders'' Funds/Equity 3.18 8.93
Dividend
Pay Out Ratio (Times) 0 0
NOTES
TO ACCOUNTS
Contingent
Liabilities 0 0
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%)