MIRA INFORM REPORT

 

 

Report Date :

19.01.2011

 

IDENTIFICATION DETAILS

 

Name :

QATAR FERTILISER COMPANY SAQ (QAFCO)

 

 

Registered Office :

Mesaieed Industrial Area, Umm Said, P O Box 50001, Doha

 

 

Country :

Qatar

 

 

Financials (as on) :

31.12.2009

 

 

Date of Incorporation :

29.09.1969

 

 

Com. Reg. No.:

29, Umm Said

 

 

Legal Form :

Qatari Joint Stock Company

 

 

Line of Business :

Production of ammonia and urea

 

RATING & COMMENTS

 

MIRA’s Rating :

A

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

Maximum Credit Limit :

US$ 10,000,000

Status :

Good

Payment Behaviour :

No Complaints

Litigation :

Clear

 

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

 

ECGC Country Risk Classification List – June 30, 2010

 

Country Name

Previous Rating

                   (01.04.2010)                  

Current Rating

(30.06.2010)

Qatar

a2

a2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

SUMMARY

 

Company Name                                     : QATAR FERTILISER COMPANY SAQ (QAFCO)

Country of Origin                                    : Qatar

Legal Form                                            : Qatari Joint Stock Company

Registration Date                                   : 29th September 1969

Commercial Registration Number                        : 29, Umm Said

Issued Capital                                        : QR 250,000,000

Paid up Capital                                      : QR 250,000,000

Total Workforce                                     : 950

Activities                                               : Production of ammonia and urea.

Financial Condition                                 : Good

Payments                                             : Nothing detrimental uncovered

Operating Trend                                     : Steady

Recommended Credit Limit                     : US$ 10,000,000

 

COMPANY NAME

 

QATAR FERTILISER COMPANY SAQ (QAFCO)

 

 

company ADDRESS

 

Registered & Physical Address

Location            : Mesaieed Industrial Area, Umm Said

PO Box             : 50001

Town                 : Doha

Country             : Qatar

Telephone         : (974) 44228888 / 44779779 / 44770252

Facsimile          : (974) 44770347 / 44770374

Email                : admin@qafco.com

 

Premises

 

Subject operates from a large suite of offices and manufacturing facilities that are owned and located in the Industrial Area of Doha.

 

Branch Office (s)

 

     Location                                                                                          Description

 

·       Al Bida Tower, 2nd Floor                                                                     Sales Office

     PO Box: 23111

     Doha

     Tel: (974) 44358686

     Fax: (974) 44358484

     Email: mktg@qafco.com

 

 

KEY PRINCIPALS

 

     Name                                                                                              Position

 

·       Abdullah Hussain Salatt                                                                     Chairman

 

·       Faisal Mohamed Al Suwaidi                                                               Vice Chairman

 

·       Khalifa Abdulla Al Suwaidi                                                                  Managing Director

 

·       Abdul Aziz Ahmed Al Malki                                                                Director

 

·       Jassim Mohamed Nama                                                                    Director

 

 

·       Meshaal Mohamed Abdulla Al Mahmoud                                             Director

 

·       Thorlief Enger                                                                                    Director

 

·       Edward Cavazuti                                                                               Director

 

·       Ali M. Mubarak                                                                                 Finance Manager

 

·       G. Hegerland                                                                                    Production Manager

 

·       Ali Al Ghareeb                                                                                  Marketing Manager

 

·       Arne Hellenes                                                                                   Chief Accountant

 

·       Salman Al Kuwari                                                                              Personnel Manager

 

·       Hakam Gran                                                                                     Maintenance Manager

 

 

LEGAL FORM & OWNERS

 

Date of Establishment  : 29th September 1969

 

History                         : Qafco was incorporated in 1969 as a joint venture between Qatar General Petroleum Corp and a number of leading multinational companies, in order to utilize Qatar's abundant gas resources for producing ammonia and urea fertilizer. The manufacturing plant was built at Umm Said with an initial capital of QR 57 million which was later raised to QR 92 million. The shares were held by the following concerns :

 

                                      1. Qatar General Petroleum Corp           70 %

                                      2. Norsk Hydro AS                               25 %

                                      3. Power Gas Corp                                 3 %

                                      4. Hambros Bank                                   2 %

 

                                      In 1990, Power Gas Corp and Hambros Bank withdrew from the company after   assigning all their shares to Qatar General Petroleum Corp. Subsequently the   capital was increased to QR 100 million and the company was re-organised under its current structure. Qatar General Petroleum Corp has since transferred its stake in the subject to its subsidiary, Industries Qatar, whilst Norsk Hydro AS has transferred its shares to Yara Netherlands BV and Fertiliser Holdings AS.

 

Legal Form                  : Qatari Joint Stock Company

 

Commercial Reg. No.  : 29, Umm Said

 

Issued Capital              : QR 250,000,000

 

Paid up Capital            : QR 250,000,000

Name of Shareholder (s)                                                         Percentage

 

·       Industries Qatar *                                                                       75%

West Bay

PO Box: 3212

Doha

Tel: (974) 44491491

 

·       Yara Netherlands BV                                                                 15%

The Netherlands

 

·       Fertiliser Holdings ASA                                                               10%

Norway

 

*    Industries Qatar is a subsidiary of Qatar Petroleum (QP)

 

 

OPERATIONS

 

Activities: Engaged in the production of ammonia and urea, Qafco operates four plants – Qafco I, Qafco II, Qafco III, and Qafco IV, which began production in 1972, 1979, 1997, and 2004 respectively.

 

QAFCO inaugurated its first plant in 1973 with a design capacity of 900 tonnes of Ammonia and 1000 Tonnes of Urea daily. Through the years, QAFCO plants have been extensively developed and they are regularly modified and modernized to be compatible with the latest technology in order to ensure continuous supply of high quality products. Presently the QAFCO complex comprises three completely integrated trains and each train comprises two units, one for production of Ammonia and the other for Urea.

 

Subject was awarded the ISO9002 certificate on 29th May 1996 and the ISO14001 on the 30th December 1997.

 

In September 2004, Qafco signed a deal with Jordan Phosphate Mines Company (JPMC), under which it will supply 130,000 tonnes of ammonia to the Jordanian firm.

 

On 3rd February 2005, Qafco signed an a letter of intent (LOI) that paves the way for phase-5 growth at what has become one of the world’s largest fertilizer plants.

 

On 26th April 2008, HH Sheikh Tamim Bin Hamad Bin Khalifa Al-Thani, the Heir Apparent, laid the foundation stone for the QAFCO-V project. The project will raise the Company’s annual ammonia output to 3.8 million MT and its urea production to 4.3 million MT per annum, thus making QAFCO the world’s largest single site producer of ammonia.

 

Production Capacity :  QAFCO I           Ammonia – 368,203 metric tonnes

                                                            Urea        – 423,209 metric tonnes

 

                                    QAFCO II          Ammonia – 434,665 metric tonnes

                                                            Urea        – 511,515 metric tonnes

 

                                    QAFCO III         Ammonia – 637,398 metric tonnes

                                                            Urea        – 830,034 metric tonnes

 

                                    QAFCO IV         Ammonia – 742,286 metric tonnes

                                                            Urea        – 1,231,380 metric tonnes

 

Import Countries: The United States of America, Norway and Germany.

 

Export Countries: Subject’s main markets are in South and East Asia, although the company now exports to over 35 countries around the world, including India (53% of ammonia sales), Australia (33% of ammonia sales), Argentina, Bangladesh, Burundi, Canada, China, Egypt, Eritrea, Ethiopia, Greece, Indonesia, Iran, Italy, Japan, Jordan, Kenya, Korea, La Reunion, Malaysia, Mexico, Mozambique, Myanmar, Nepal, Oman, Pakistan, Philippines, Qatar, Singapore, Sri Lanka, South Africa, Sudan, Taiwan, Tanzania, Thailand, Turkey, UAE, Uruguay, USA, Vietnam, Yemen, Zambia, and Zimbabwe.

 

Operating Trend: Steady

 

Subject has a workforce of approximately 950 employees.

 

 

FINANCIAL DATA

 

Financial highlights provided by local sources are given below:

 

Currency: Qatari Riyals (QR)

 

Consolidated Balance Sheet                                                      31/12/08                         31/12/09

 

ASSETS

Non-current assets

Property, plant and equipment                                                     4,931,598,323                9,949,112,643

Project under development                                                          1,352,590,814                990,968,858

Catalysts                                                                                  25,087,826                    41,557,884

6,309,276,963                10,981,639,385

Current assets

Inventories                                                                                 307,093,108                  331,500,709

Accounts receivable and prepayments                                         675,648,292                  564,898,452

Other financial assets                                                                 161,006,487                  3,035,827

Bank balances and cash                                                            5,018,916,534                1,907,800,697

6,162,664,421                2,807,235,685

TOTAL ASSETS                                                                        12,471,941,384 13,788,875,070

 

EQUITY AND LIABILITIES

Equity attributable to equity holders of the parent

Share capital                                                                             1,000,000,000                1,000,000,000

Legal reserve                                                                             204,258,219                  205,354,707

Cumulative changes in fair values                                                (446,409,569)                (128,196,557)

Retained earnings                                                                      7,713,985,307                8,255,631,605

8,471,833,957                9,332,789,755

Minority interest                                                                         15,324,657                    17,114,121

Total equity                                                                               8,487,158,614                9,349,903,876

Non-current liabilities

Term loan                                                                                  1,780,273,519                3,594,067,629

Other financial liability                                                                386,414,545                  129,977,389

Employees’ end of service benefits                                              64,502,340                    69,789,957

2,231,190,404                3,793,834,975

Current liabilities

Accounts payable and accruals                                                   1,286,421,161                575,574,309

Other financial liability                                                                221,001,511                  1,254,994

Income tax payable                                                                    246,169,694                  68,306,916

1,753,592,366                645,136,219

Total liabilities                                                                            3,984,782,770                4,438,971,194

TOTAL EQUITY AND LIABILITIES                                               12,471,941,384 13,788,875,070

 

Consolidated Income Statement

 

Sales -net                                                                                 6,119,548,364                3,306,600,136

Cost of sales                                                                             (1,447,416,950) (1,549,770,292)

GROSS PROFIT                                                                        4,672,131,414                1,756,829,844

Other income                                                                             312,840,221                  214,376,793

Selling and distribution costs                                                      (113,378,612)                (55,118,244)

Administrative expenses                                                             (185,470,866)                (220,056,143)

PROFIT FOR THE YEAR                                                            4,686,122,157                1,696,032,250

Attributable to:

Equity holders of the parent                                                        4,684,025,699                1,692,742,786

Minority interest                                                                         2,096,458                      3,289,464

PROFIT FOR THE YEAR                                                            4,686,122,157                1,696,032,250

 

Local sources consider subject’s financial condition to be Good.

 

 

BANKERS

 

·       Qatar National Bank

PO Box: 50050

Umm Said

Tel: (974) 44771529

Fax: (974) 44771062

 

·       Doha Bank Ltd

Umm Said

PO Box: 50111

Doha

Tel: (974) 44771984

Fax: (974) 44770639

 

·       HSBC Bank Middle East

Abdulla Bin Jassim Street

PO Box: 57

Doha

Tel: (974) 44423124

Fax: (974) 44416353

 

PAYMENT HISTORY

 

No complaints regarding subject’s payments have been reported.

 

 

GENERAL COMMENTS

 

Qafco is the only fertilizer producer in Qatar and specialises in the production of Ammonia and Urea. It is the largest single fertilizer producer in the Middle East and puts Qatar among the leading exporters of Ammonia and Urea in the world, indeed when Qafco-4, a US$ 470 million project - went onstream in 2004 it made Qafco the world's largest producer of urea.

 

Qafco has been one of the most successful local / foreign industrial ventures in Qatar. It has recorded substantial profits since 1980. Experts see this as a result of several factors, including the local cost of feedstock, its US$ 0.36 million British Thermal Units (BTUs), and the priority given to maintenance work.

 

During the course of this investigation nothing detrimental was uncovered regarding subject’s operating history or the manner in which payments are fulfilled. As such the company is considered to be a fair trade risk.

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.45.53

UK Pound

1

Rs.72.56

Euro

1

Rs.60.62

 

 

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

Capability to overcome financial difficulties seems comparatively below average.

 

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

----

NB

New Business

----

 

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

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.