MIRA INFORM REPORT

Report Date :

03.05.2007

IDENTIFICATION DETAILS

Name :	QUANG NAM PHARMACEUTICAL MEDICAL MATERIAL JOINT STOCK COMPANY
Registered Office :	No. 120 Huynh Thuc Khang Str., Xuan An Ward, Tam Ky Town, Quang Nam Province
Country :	Vietnam
Date of Incorporation :	1997
Legal Form :	Joint Stock Company
Line of Business :	Manufacture, trading, export and import of pharmaceutical products, medicine, medical material, chemical and cosmetic.

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

Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear

SUBJECT IDENTIFICATION & LEGAL FORM
English Name		QUANG NAM PHARMACEUTICAL MEDICAL MATERIAL JOINT STOCK COMPANY
Known as		QUANG NAM PHARMACEUTICAL MEDICAL EQUIPMENT JOINT STOCK COMPANY
Vietnamese name		CONG TY CO PHAN DUOC VAT TU Y TE QUANG NAM
Trade Name		QUANAPHARCO
Type of Business		Joint Stock Company
Founded		1997
Establishment Decision		No. 1776/QD-UB
Issued on		September 16^th 1997
Issued by		Quang Nam People’s Committee
Equitization Decision		No. 4962/QD-UB
Issued on		November 29^th 2004
Issued by		Quang Nam People’s Committee
Business Registration		No. 3303070106
Issued on		January 31^st 2005
Issued by		Quang Nam Department of Planning and Investment
Registered Capital		6,900,000,000 VND
Tax Code		4000101252
Total Employees		287 persons
Qualification		Fairly Good
ADDRESS
Head Office
Address		No. 120 Huynh Thuc Khang Str., Xuan An Ward, Tam Ky Town, Quang Nam Province, Vietnam
Tel		(84-510) 812010
Fax		(84-510) 828189
Note: The subject has 12 branches in all districts of Quang Nam Province.
DIRECTORS
1. NAME		Mr. LE VAN QUANG
Position		Director
Contact Address		No. 120 Huynh Thuc Khang Str., Xuan An Ward, Tam Ky Town, Quang Nam Province
Nationality		Vietnamese
2. NAME		Mr. NGUYEN DINH TANG
Position		Vice Director
Contact Address		No. 120 Huynh Thuc Khang Str., Xuan An Ward, Tam Ky Town, Quang Nam Province
Nationality		Vietnamese
3. NAME		Mr. BUI VAN TRINH
Position		Vice Director
Contact Address		No. 120 Huynh Thuc Khang Str., Xuan An Ward, Tam Ky Town, Quang Nam Province
Nationality		Vietnamese
BUSINESS NATURE AND ACTIVITIES
The subject registered in the following lines of business:
- Manufacture, trading, export and import of pharmaceutical products, medicine, medical material, chemical, and cosmetic.
Note: The subject mainly imports and trades in pharmaceutical from foreign markets. The subject is also producing some basics chemical for healthcare.
IMPORT & EXPORT ACTIVITIES
IMPORT: The subject imports from India, Germany, Philippines, China …
EXPORT: N/A
BANKERS
1. NAME	VIETNAM BANK FOR AGRICULTURAL & RURAL DEVELOPMENT - QUANG NAM BRANCH
Address	No.6 Phan Boi Chau Str., Tam Ky Town, Quang Nam Province, Vietnam
Tel	(84-510) 852265
Fax	(84-510) 851812
Account No.	431101000149
2. NAME	INCOMBANK – QUANG NAM BRANCH
Address	No.22 Phan Boi Chau Str, Tam Ky Town, Quang Nam Province, Vietnam
Tel	(84-510) 851414
Fax	(84-510) 851080
Account No	10020000044702
3. NAME	BIDV – QUANG NAM BRANCH
Address	No.4 Phan Boi Chau Str, Tam Ky Town, Quang Nam Province
Country	Vietnam
Tel	(84-510) 834030
Fax	(84-510) 859064
SHAREHOLDERS
1. NAME		QUANG NAM PEOPLE’S COMMITTEE
Represented by		Mr. LE VAN QUANG
Position		Director
Contact Address		No. 120 Huynh Thuc Khang Str., Xuan An Ward, Tam Ki Town, Quang Nam Province
Nationality		Vietnamese
Share		51 percent
2. NAME		STAFFS AND OTHER SHAREHOLDERS
Position		Shareholders
Share		49 percent
PAYMENT HISTORY AND EXPERIENCES
Trade Morality		Fair
Liquidity		Average
Payments		Fair prompt
Financial Situation		Fairly good
Development trend		Good
Litigation Data		No reported
Bankruptcy		No reported
Payment Method		TT, L/C
Sale Method		Supplying For Customer And Projects
FINANCIAL DATA
According to Chief accountant of the subject, in 2006, revenue is about 188,000,000,000 VND and its profit is 889,000,000 VND. The full financial statement in 2005 is not available, following is financial highlight.
Unit: 1,000,000VND
Description				2005
Current assets & Short term Investment				74,282
Fixed assets & Long term investment				3,570
Total Assets				77,852
Payables				69,623
Owner’s Equity				8,229
Total Liability And Equity				77,852
Total revenue				142,877
Deductions Items				1,594
Net revenue				141,283
Net income from business activity				396
Net income from financial operation				-1,452
Irregular Profit				1,888
Total pre-tax profit				832
BALANCE SHEET
Unit: VND million
Balance sheet date			31/12/2004		31/12/2003
Number of weeks			52		52
ASSETS
A. Working assets & short-term Investment			55,078		43,992
I. Cash and cash equivalents			2,073		2,654
II. Short-term investment			0		0
1. Short-term securities investment			0		0
2. Other short-term investment			0		0
3. Provision for short-term investment			0		0
III. Receivables			27,285		21,777
1. Receivables from customers			9,523		10,870
2. Prepayment for providers			0		1
3. Value-added tax deducted			977		236
4. Internal receivables			16,239		10,497
5. Other receivables			546		173
6. Provision for bad receivables			0		0
IV. Inventory			24,783		18,985
1. Purchased goods in transit			0		6
2. Raw materials			31		22
3. Instrument, tools			93		3
4. Cost for production and business in process			0		0
5. End products			0		0
6. Goods			24,659		18,955
7. Goods on consignment			0		-1
8. Provision for devaluation of stocks			0		0
V. Other current assets			937		576
1. Advances			198		473
2. Prepaid expenses			55		51
3. Pending expenses for transfer			633		1
4. Pending assets			0		0
5. Mortgage, collateral and short run collateral			51		51
VI. Administrative			0		0
1. Administrative expenses for previous year			0		0
2. Administrative expenses for current year			0		0
B. Fixed assets & Long term investment			3,461		4,639
I. Fixed assets			2,777		4,614
1. Tangible fixed assets			2,777		4,609
+ Original cost			4,701		6,210
+ Accumulated depreciation value			-1,924		-1,601
2. Financial leasing fixed assets			0		5
+ Original cost			0		5
+ Accumulated depreciation value			0		0
3. Intangible fixed assets			0		0
+ Original cost			0		0
+ Accumulated depreciation value			0		0
II. Long term investment			0		3
1. Long-term securities investment			0		0
2. Joint-venture capital contribution			0		0
3. Other long-term investment			0		3
4. Provision for long-term investment devaluation			0		0
III. Capital construction in process			668		9
IV. Other			16		13
TOTAL ASSETS			58,539		48,631
LIABILITIES
A. Payable loans			51,268		43,088
I. Short term payables			50,725		42,168
1. Short-term borrowings			17,678		17,986
2. Due long-term liabilities			0		0
3. Payables to supplier			15,939		11,947
4. Prepayment of buyer			10		437
5. Taxes and accounts dutiable			43		570
6. Employee payments			297		554
7. Internal payables			16,239		10,498
8. Other payables			519		176
II. Long term loans			114		633
1. Long-term borrowings			114		633
2. Long-term payables			0		0
III. Other payables			429		287
1. Payable expenses			271		128
2. Pending assets			0		0
3. Receipts long-term collateral and deposit			158		159
B. Owner’s Equity			7,271		5,543
I. Capital and Funds			7,151		5,329
1. Working capital			6,344		4,572
2. Differences from asset revaluation			0		0
3. Exchange rate differences			0		0
4. Development investment funds			690		690
5. Reserved funds			0		0
6. Retained profit			50		0
7. Construction capital sources			67		67
II. Other administrative and fund sources			120		214
1. Provident funds for unemployment			0		0
2. Reward and welfare funds			120		214
3. Management funds of higher level			0		0
4. Functional operation funds			0		0
5. Fund sources formed by fixed assets			0		0
TOTAL LIABILITY AND EQUITY			58,539		48,631

PROFIT & LOSE STATEMENT
Description	FY 2004	FY 2003
Total revenue	134,801	124,278
Deductions Items	1,912	1,589
- Discount	1,552	1,197
- Devaluation	1	0
- Return of sold goods	359	11
- Turnover tax, Luxury tax & Export tax	0	381
1. Net revenue	132,889	122,689
2. Cost of goods sold	121,916	111,201
3. Gross Profit	10,973	11,488
4. Sales expenses	6,287	6,148
5. Enterprise administrative expenses	4,245	4,192
6. Net income from business activities	441	1,148
Income from financial activities	552	742
Expenditure from financial activities	1,908	1,645
7. Net income from financial operation	-1,356	-903
Irregular income	1,170	358
Irregular expenditure	35	3
8. Irregular Profit	1,135	355
9. Total pre-tax profit	220	600
10. Income tax	61	192
11. After tax profit	159	408
FINANCIAL FACTORS
Description	FY 2004	FY 2003
Current liquidity ratio	1.09	1.04
Quick Liquidity ratio	0.60	0.59
Inventory circle	5.57	11.71
Average receive period	74.94	64.79
Utilizing Asset Performance	2.27	2.52
Liability/ Total Asset (%)	87.58	88.60
Liability/ Owner's equity (%)	705.10	777.34
Income before tax/ Total asset (%) ROA	0.38	1.23
Income before tax/ Owner's equity (%) ROE	3.03	10.82
Gross Profit / Total revenue (%) GPM	8.14	9.24
Income before tax/ Total revenue (%) NPM	0.16	0.48
INTERPRETATION
The subject was a State owned company. It was established in 1997 under the decision of Quang Ngai People’s Committee. The business of the subject was to trade in pharmaceutical products and produced basic chemical medicines to supply for local market. In January 2005, the subject was officially transformed to a Joint stock company but the State is still keeping right of control with 51 percent of shares. The position in the industry of the subject is good. The premises of the subject are average. The subject now focuses on trading in pharmaceutical for local market such as village hospitals, and district hospitals. The subject has already won a contract to supply medial materials and pharmaceuticals for local hospital. The market share of the subject seems fairly good. It mainly distributes products in Quang Nam province. The business activities of the subject are average. Its management capacity is normal. Turnover of the subject is increasing but at a slow rate. The future prosperity of the subject seems bright. In general, the financial and operational status of the subject is regarded rather good. Its business operation is stable but with a slow rate of development. The subject has capacity to meet financial commitments. No caution needed for small and normal business transactions.

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%)

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