MIRA INFORM
REPORT
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Report Date : |
29.01.2011 |
IDENTIFICATION DETAILS
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Name : |
FRUTAROM LTD. |
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Registered Office : |
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Country : |
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Financials (as on) : |
30.09.2010 |
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Date of Incorporation : |
04.02.1955 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Subject operates in the field of flavors and fragrances |
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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Status : |
Good |
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Payment
Behaviour : |
No Complaints |
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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
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Country Name |
Previous Rating (01.04.2010) |
Current Rating (30.06.2010) |
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a2 |
a2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
Company name & address
FRUTAROM LTD.
Telephone 972
4 846 24 62
Fax 972
4 872 25 17
Haifa Bay Industrial Zone
HISTORY & LEGAL FORMATION
A private limited
company, incorporated as per file No. 51-013293-9 on the 04.02.1955, continuing
activities which were originally established in 1933.
In February 2005
BALTIMOR SPICE ISRAEL LTD., was merged into subject
In November 2009
RAYCHAN BEEROT ITZCHAK FOOD INDUSTRIES LTD. was merged into subject.
SHARE CAPITAL
Authorized share
capital
27,000,000 ordinary shares of
of which
23,972,645 shares amounting to
SHAREHOLDERS
Company is fully
owned by FRUTAROM INDUSTRIES LTD., a public limited company, shares of which
are traded on the Tel Aviv Stock Exchange and London Stock Exchange, controlled
(around 37%) by I.C.C. HANDELS A.G., of Switzerland, controlled by Dr. John
Farber.
DIRECTORS
1. Ori Yehudai, President and
Chief Business Manager,
2. Alon Granot, Vice President
and CFO.
Dr. John Farber is
the Chairman of FRUTAROM INDUSTRIES.
BUSINESS
Subject operates
in the field of flavors and fragrances, in 2 lines:
·
Flavors Division (constituting some two thirds of the
company's sales volume) which develops, produces and markets flavors, savory
solutions, seasonings and food systems.
·
Fine Ingredients Division, which develops,
produces and markets natural flavor extracts, functional food ingredients,
natural pharmaceutical/ nutraceutical extracts, specialty essential oils,
citrus products and aroma chemicals.
Also traders,
importers and marketers of raw materials for the food and beverages industries.
Over 75% of the
goods are exported to over 13,000 clients in over 120 countries worldwide.
Main Customers: COCA-COLA, PEPSICO, NESTLE,
UNILEVER, JOHNSON & JOHNSON, etc.
Among local suppliers: SAM-ON LABORATORIES,
NEGEV SPICES, DORMEX TRADING & INVESTMENTS CO., DAGAL FOOD ADDITIVES,
DEPOTCHEM, HADAR 2000 PLATFORMS, OROKIA
Operating from
partly owned premises (headquarters and plant), on an area of 35,490 sq. meters
in 25 Hashayish Street, Industrial Zone, Haifa Bay, Haifa and from an owned
plant, on an area of 9,273 sq. meters in the Acre Industrial Zone. The Group
operates also from plants in
Having 1,448
employees serving the whole FRUTAROM Group, of which
MEANS
Parent FRUTAROM
INDUSTRIES current market value US$ 600 million.
Subject is an
“Approved Enterprise” and as such enjoys tax benefits and State incentives.
In 2000, the
Israeli Investment Center (IIC) approved a
In May 2002, IIC approved
further US$ 2.54 million investment to in the expansion of subject’s plant.
In December 2002,
IIC approved a
In
February 2005, parent published a prospectus offering shares to the public on
the
There are 4
charges for unlimited amounts registered on the company's assets, in favor of
Bank Leumi Le'Israel Ltd., Bank Hapoalim Ltd., Mizrahi Tefahot Bank Ltd., The
First International Bank of Israel Ltd.
Financial data is
included in the consolidated B/S of parent company,
FRUTAROM
INDUSTRIES LTD., which shows:
(Note: All of
FRUTAROM INDUSTRIES business and production activities are concentrated and
held by subject hence the financial statements practically reflects subject's
status):
US$
(thousands)
31.12.2009 30.09.2010
ASSETS
Current assets:
Cash and cash
equivalents 42,940 45,878
Customers 65,194 79,007
Other debtors 13,380 10,526
Pre-paid expenses 3,018 4,459
Stock 79,113 85,202
203,645 225,072
Non-current assets:
Fixed assets, net 127,549 124,912
Intangible assets, net 191,145 180,076
Other non-current assets 3,774 1,646
322,468 306,634
526,113 531,706
======= =======
LIABILITIES
Current liabilities 101,396 106,632
Non-current liabilities 106,242 73,545
Equity 318,475 351,529
526,113 531,706
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ANNUAL SALES
· Subject ended 2007 with a net profit of US$ 14,701,000.
· Subject ended 2007 with a net profit of US$ 14,701,000.
· Subject ended 2008 with a net profit of US$ 35,956,000.
· Subject ended 2009 with a net profit of US$ 33,436,000.
FRUTAROM
INDUSTRIES LTD.
Consolidated
Statement of Income
US$
(thousands)
Year
ended 31.12
2007 2008 2009
Sales 368,261 473,286 425,179
Gross profit 130,755 176,271 155,502
Operating income 34,526 56,611 47,285
Profit before taxes
on income 31,603 46,061 42,941
Net income 24,193 27,229 33,220
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Parent FRUTAROM
INDUSTRIES consolidated first 3 quarters of 2010 sales were US$ 338,692,000 (7%
increase compared to the parallel period in 2009), making a gross profit of US$
133,523,000, an operating income of
US$ 50,912,000 and a net income of US$ 35,283,000.
OTHER COMPANIES
FRUTAROM
INDUSTRIES LTD., a holding company. Also holds:
FRUTAROM TRUSTEE LTD., 100%.
Subject's
subsidiaries (all wholly owned, unless otherwise mentioned):
FRUTAROM TRADE
AND MARKETING (1990) LTD.
FRUTAROM
FRUTROM MEXICO
S.A.
FRUTAROM RUSSIA
LTD.
FRUTAROM
KAZAKHSTAN LTD.
FRUTAROM UKRAINE
LTD.
FRUTAROM FLAVOURS
(KUNSHAN) COMPANY LTD.,
FRUTAROM DO
GALIL ESSENCES
LTD., non active
INTERNATIONAL
FRUTAROM CORP.,
FRUTAROM INC. (formerly ACATRIS), ABACO
INC., ABACO MANUFACTURING LLC.
NUTRA LIZ LTD.,
55%
FRUTAROM (U.K.)
LTD. holds: TURKISH HOLDINGS LTD.,
FRUTAROM
SWITZERLAND LTD. holding:
FRUTAROM NORDIC
A/S, FRUTAROM (MARKETING) SRL, FRUTAROM FRANCE SARL, FRUTROM NETHERLANDS B.V.
holding:
FRUTAROM BELGIUM N.V. and FRUTAROM USA
HOLDINGS INC., non-active
FRUTAROM
GEWURZMUHLE NESSE GmbH,
FOOD VENTURE GMBH, 75%
GEWURMUHLE NESSE GEBR. KRAUSE
NESSEPOL SP.Z.O.O.,
BLESSING BIOTECH GMBH
GEWURZMULLER GMBH, holds: E-BUSINESS &
TELEMARKETING GMBH, SELL-4-U.COM AGENTUR FUR MARKETING, GEWURZMULLER AG.
BELMAY LTD.,
holds: BELMAY PACIFIC PTE LTD.
FAR AROMATIK GIDA
URUNLERI SANAYE VE TICARET LTD.,
FRUTAROM F&F (SHANGHAI) TRADING CO.
LTD.
FRUTROM
BANKERS
·
Bank Leumi Le’Israel Ltd.,
·
Bank Hapoalim Ltd.,
·
The
First International Bank of Israel Ltd., Kiryat Bialik Branch (No. 008), Kiryat
Bialik.
CHARACTER AND REPUTATION
There are several
environmental claims and procedures subject is involved in, including a motion for
a class action lawsuit. Most claims are on environmental grounds against
subject's plant in
In September 2009
the Ministry of Environment said subject has not complied to the environmental
restrictions and the Ministry will deliver a closing order to subject’s
relevant plant, in case the matter not resolved.
Nothing
unfavorable learned apart of that.
Until 1996,
subject's parent, FRUTAROM INDUSTRIES, was part of ELECTRO-MECHANICAL INDS.
(1952) LTD., when FRUTAROM's activities were split from the latter's and has
been operating completely independently since.
In December 2002,
FRUTAROM acquired an essence plant in the
In June 2003,
FRUTAROM announced it signed a deal to acquire FLACHSMANN of Switzerland, for a
sum of US$ 20 million.
In May 2004,
subject signed a deal to acquire the Food Systems division (fruit preparation
activity) in
In second half of
2004 the IFF deal was completed.
In the framework
of FRUTAROM Group expansion strategy, in January 2006, FRUTAROM completed a
deal in which it acquire 70% of NESSE of Germany, producers of savory essences,
for a sum of €18.4 million, with an option to acquire the reminder 30%. In May
2008, FRUTAROM realized the option, paying €13.75 million for the remaining
30%.
In September
2006, it was reported that subject is adding a new product to its products
portfolio, after signing an agreement with local company D. HERB LTD., to
manufacture and market an essence extracted of a plant used for diabetics.
In October 2006
acquired from Dutch ROYAL SCHOUTEN GROUP all shares of ACATRIS (including
ACATRIS INC. of the U.S.A., ACATRIS SPECIALITIES HOLDING B.V. of the
Netherlands and ACATRIS BELGIUM N.V of Belgium, all known as ACATRIS HEALTH)
for €10.5 million in cash (ACTARIS INC’s name was changed to FRUTAROM INC. and
so names of its subsidiaries).
ACATRIS HEALTH, employing 38, specializes
in manufacturing and marketing of "LifeLine" product range. Its
primary markets are Western Europe and the
In October 2007
FRITAROM acquired 100% of RAYCHAN BEEROT ITZCHAK FOOD INDUSTRIES LTD.; local
developers, manufacturers and marketers of flavors mixtures and raw materials
for the food industry, for US$ 1 million to RAYCHAN's shareholders, as well as
assuming RAYCHAN's debt of US$ 12 million. RAYCHAN's activities were merged
into NESSE’s local activities.
In April 2007
subject's parent completed 2 acquisitions (100%); both dealing as manufacturers
and marketers of products similar to subjects for the food and beverage
industries: BELMAY LIMITED of the U.K, for US$ 17.1 million. BELMAY is a
leading British essences company.
2nd
purchase was JUPITER FLAVOURS LIMITED., also of the
JUPITER
activities were merged into BELMAY.
In August 2007
FRUTAROM completed the acquisition of the assets of local company ADUMIM FOOD
ADDITIVES LTD., in consideration of US$ 4.25 million. ADUMIM, established in
1977, was publicly traded on the Tel Aviv Stock Exchange. The activity acquired
includes the development, manufacturing and marketing of emulsifiers and additives for the food industry
and natural food ingredients to the health food industry (vitamins, essences,
etc.). The
acquired activities include the ADUMIM's 45.8% shares in NUTRA LIZ LTD.,
developers of food additives.
In July 2007,
FRUTAROM acquired 100% of ABACO (including ABACO INC. and ABACO MANUFACTURING
LLC), a private American company in consideration of US$ 4 million, as well as
carrying ABACO's debt of US$ 1.1 million. ABACO, established in 1989, had 2006
sales of US$ 3.2 million.
ABACO deals as
developers, manufacturers and marketers of unique raw materials for the flavors
industries.
In October 2007,
FRUTAROM signed an agreement to acquire 100% of 2 companies in the German
GEWURZMULLER Group (GEWURZMULLER GmbH and BLESSING BIOTECH GmbH), in
consideration of €47.3 million, in cash. The GEWURZMULLER Group, established in
1896, is an international leading Group in the manufacturing and marketing of
savory essences.
In November 2007
subject acquired all the activity of RAD NATURAL TECHNOLOGIES LTD., Israeli
company dealing in development, manufacturing and marketing of natural essences
from plants, for US$ 4.1 million.
In February 2009
FRUTAROM completed the acquisition of assets and businesses of British firm
OXFORD CHEMICALS LIMITED for US$ 12 million.
In March 2009,
FRUTAROM purchased the assets and activities of American FLAVORS SPECIALITIES
INC. (FSI), for US$ 17.2 million in cash. FSI, established in 1979,
manufactures flavors in the niche of Botanical Extracts, and had 2008 sales of
US$ 11.5 million.
In July 2009
subject purchased CHRISTIAN HANSEN of
In December 2010
FRUTAROM acquired the Industrial Savory activities of REIBER & SON ASA of
On January 23rd
2011 FRUTAROM reported that subject's subsidiary signed an agreement to
purchase the assets and activities of EAST ANGLIAN FOOD INGREDIENTS LTD., of
Subject estimates
the global market in which it operates at US$ 15 billion.
According to
research firm LEFFINGWELL & ASSOCIATES subject is ranked amongst the 10
largest companies in the world in the fields of food flavors and flavor
extracts.
SUMMARY
Good for trade
engagements and all credits
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.45.74 |
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1 |
Rs.72.73 |
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Euro |
1 |
Rs.62.73 |
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 |
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 |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.