MIRA
INFORM REPORT
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Report Date : |
24.01.2008 |
IDENTIFICATION
DETAILS
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Name : |
WENZHOU OUHUA FOREIGN TRADE CO., LTD. |
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Registered Office : |
14-15f, Development Zone
Building, No. 350 West Yandang Raod, Wenzhou, 325000 |
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Country : |
China |
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Financials (as on) : |
31.12.2006 |
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Date of Incorporation : |
13.06.1985 |
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Com. Reg. No.: |
3303001004129 |
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Legal Form : |
State-Owned Enterprise |
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Line of Business : |
International Trade |
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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Maximum Credit Limit : |
USD 300,000 |
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Status : |
Satisfactory |
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Payment Behaviour : |
No Complaints |
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Litigation : |
Clear |
name and address of the company
WENZHOU OUHUA FOREIGN TRADE CO., LTD.
14-15f, Development
Zone Building,
No. 350 WEST YANDANG
RAOD, WENZHOU, 325000 PR CHINA
350 14-15
TEL: 86 (0)
577-88955086 FAX: 86 (0)
577-88955086
EXECUTIVE SUMMARY
INCORPORATION DATE : JUN. 13, 1985
REGISTRATION NO. : 3303001004129
REGISTERED LEGAL FORM : STATE-OWNED ENTERPRISE
STAFF STRENGTH :
45
REGISTERED CAPITAL : cny 2,669,000
BUSINESS LINE : TRADE
TURNOVER :
CNY 754,280,000 (AS OF DEC. 31, 2006)
EQUITIES :
CNY 36,740,000 (AS OF DEC. 31, 2006)
PAYMENT :
AVERAGE
RECOMM. CREDIT RANGE : up to USD 300,000
MARKET CONDITION : COMPETITIVE
FINANCIAL CONDITION : stable
OPERATIONAL TREND : STEADY
GENERAL REPUTATION : AVERAGE
EXCHANGE RATE :
CNY
7.24 =USD
Adopted abbreviations:
ANS - amount not stated
NS - not stated
SC - subject company (the company inquired by you)
NA - not available
CNY - China Yuan Renminbi
SC was registered as a state-owned enterprise at
local Administration for Industry & Commerce (AIC - The official body of issuing
and renewing business license) on Jun. 13, 1985.
Company Status: State-owned enterprise This form of business in PR China is defined as a
commodity production or operational units of a socialist character which in
accordance with the law, have autonomy in management, and take full
responsibility for its profits and losses and practices independent
business accounting. It is a legal person established directly by central /
local government or enterprise owned by central or local government. In
theory, the liabilities of this form of enterprise are ultimately borne by
the government, since the adoption of company law in mid-1994, the Chinese
government has planned to separate the ownership from management and
liabilities bearing.
SC’s registered
business scope includes importing and exporting
commodities and technologies, excluding the goods controlled to export under
state-unified operation and the goods controlled to import by the
state-designated companies; importing and exporting commodity & technology;
processing with imported materials, processing with imported samples,
assemblying with imported parts, and compensation trade in agreement; barter trade & transiting trade;
SC is mainly
engaged in international trade.
Mr. You
Bingxing has been chairman of SC since
2000.
SC owns
approximately 45 staff at present.
SC is
currently operating at the above stated address, and this address houses its
operating office in the commercial zone of Wenzhou. Our checks reveal that SC
owns the total premise about 1,000 square meters.
SC is not known to host website of its own at present.
Changes of its registered information:
|
Date of change |
Item |
Before the change |
After the change |
|
2005-12-26 |
Address |
2F Suite A, Shuanglian Building, Xiaonan Road, |
14-15F,
Development Zone, Building, No. 350 West
Yandang Road |
|
2007-3-30 |
Registered capital |
CNY 2,000,000 |
CNY 2,669,000 |
MAIN SHAREHOLDERS:
Name %
of Shareholding
State-owned Assets Supervision and
Administration 100
Commission of Wenzhou
l
General Manager:
Mr. You Bingxing, born in 1953, with senior high school education. He is
currently responsible for the overall management of SC.
Working Experience(s):
From 2000 to present Working
in SC as general manager.
SC is mainly
engaged in international trade.
SC’s products mainly include: scarves, hats, gloves and shawls.
SC sources its materials 80% from domestic
market, and 20% from overseas market, mainly USA and Europe. SC sells 80% of
its products in domestic market, and 20% to overseas market, mainly Southeast
Asian market.
The buying terms of SC include Check, L/C, T/T and Credit of 30-60 days.
The payment terms of SC include Check, L/C, T/T, and Credit of 30-60 days.
SC is
not known to have any 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.
Bank of China
Wenzhou Sub-branch
AC#: 4018090000817
Relationship:
Normal.
Balance Sheet
Unit: CNY’000
|
|
as
of Dec. 31, 2005 |
as
of Dec. 31, 2006 |
|
Cash & bank |
42,740 |
60,350 |
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Inventory |
37,350 |
43,580 |
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Accounts
receivable |
15,060 |
12,340 |
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Accounts payable
advance |
2,070 |
6,140 |
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A receivable tax
rebate of export |
22,610 |
19,310 |
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Subsidies
receivable |
0 |
950 |
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Other
receivables |
3,330 |
1,800 |
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Other current
assets |
0 |
0 |
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------------------ |
------------------ |
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Current assets |
123,160 |
144,470 |
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Fixed assets |
5,910 |
5,520 |
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Fixed assets net
value |
3,560 |
3,320 |
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Projects under
construction |
0 |
0 |
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Long term
investment |
3,180 |
3,180 |
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Other assets |
2,350 |
0 |
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------------------ |
------------------ |
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Total assets |
132,250 |
150,970 |
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============= |
============= |
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Short loans |
57,110 |
36,350 |
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Accounts payable |
11,410 |
6,950 |
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Accounts
receivable advance |
26,080 |
71,350 |
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Salary payable |
590 |
110 |
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Welfare payable |
390 |
60 |
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Tax payable |
-3,310 |
-6,350 |
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Other payable |
4,600 |
5,240 |
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Accrued expenses |
760 |
360 |
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Other current
liabilities |
-200 |
160 |
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------------------ |
------------------ |
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Current
liabilities |
97,430 |
114,230 |
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Long term
liabilities |
0 |
0 |
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------------------ |
------------------ |
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Total
liabilities |
97,430 |
114,230 |
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Equities |
34,820 |
36,740 |
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------------------ |
------------------ |
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Total
liabilities & equities |
132,250 |
150,970 |
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============= |
============= |
Income Statement
Unit: CNY’000
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|
as of Dec. 31, 2005 |
as of Dec. 31, 2006 |
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Turnover |
617,090 |
754,280 |
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Cost of goods
sold |
600,990 |
739,700 |
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Sales expense |
10,670 |
12,630 |
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Management expense |
4,380 |
5,570 |
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Finance expense |
-1,660 |
-4,540 |
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Profit before
tax |
7,750 |
5,900 |
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Less: profit tax |
0 |
0 |
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Profits |
7,750 |
5,900 |
Important Ratios
=============
|
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as
of Dec. 31, 2005 |
as
of Dec. 31, 2006 |
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*Current ratio |
1.26 |
1.26 |
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*Quick ratio |
0.88 |
0.88 |
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*Liabilities
to assets |
0.74 |
0.76 |
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*Net profit
margin (%) |
1.26 |
0.78 |
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*Return on
total assets (%) |
5.86 |
3.91 |
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*Fixed
assets/Total assets |
0.04 |
0.04 |
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*Inventory
/Turnover ×365 |
22days |
21days |
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*Accounts
receivable/Turnover ×365 |
9days |
6days |
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*Turnover/Total
assets |
4.67 |
5.00 |
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* Cost of
goods sold/Turnover |
0.97 |
0.98 |
PROFITABILITY:
FAIRLY GOOD
l
The turnover of SC appears fairly good in its line, and it increased
greatly in 2006.
l
SC’s net profit margin was decreased; but it remains at an average level
in 2006.
l
SC’s return on total assets was decreased; but it still remains at an
average level in 2006.
l
SC’s cost of goods sold is fairly high, comparing with its turnover.
LIQUIDITY: AVERAGE
l
The current ratio of SC is maintained in a normal level.
l
SC’s quick ratio is maintained in a normal level.
l
The inventory of SC appears fairly large in 2005.
l
The accounts receivable of SC appears acceptable in 2005
l
The short-term loan of SC appears fairly large.
l
SC’s turnover is in a fairly good level, comparing with the size of its
total assets.
LEVERAGE: AVERAGE
l
The debt ratio of SC is maintained in a normal level.
l
The risk for SC to go bankrupt is average.
Overall financial
condition of the SC: Stable.
Over the past 22 years, SC has made a stable growth with satisfactory
profit. It is considered a credit line up to USD 300,000 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. |
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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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%)