MIRA INFORM REPORT

Report Date :

17.03.2011

IDENTIFICATION DETAILS

Name :	AXSTORES FAR EAST LTD.
Registered Office :	16/F., The Cameron, 33 Cameron Road, Tsimshatsui, Kowloon
Country :	Hong Kong
Date of Incorporation :	10.10.1986
Com. Reg. No.:	10713566
Legal Form :	Private Limited Company
Line of Business :	Importer, Exporter, Re-exporter, Agent and Representative of Garments, other textile products, electronic equipment, cosmetics, and general merchandises.

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 :	Good
Payment Behaviour :	Regular
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 – December 31, 2010

Country Name	Previous Rating (30.09.2010)	Current Rating (31.12.2010)
Hong Kong	A2	A2

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

Name and address

AXSTORES FAR EAST LTD.

ADDRESS: 16/F., The Cameron, 33 Cameron Road, Tsimshatsui, Kowloon, Hong Kong.

PHONE: 2367 7122

FAX: 2311 2483, 2368 6642

E-MAIL: angie.chu@afe.ahlens.com.hk

MANAGEMENT

General Manager: Ms. Angie Chu

SUMMARY

Incorporated on: 10th October, 1986.

Organization: Private Limited Company.

Capital: Nominal: HK$10,000.00

Issued: HK$20.00

Business Category: Agent and Representative.

Group Net Sales:- (Year ended 31-12-2010)

SEK 6,657 million (Axstores Group)

SEK 20,899 million (Axel Johnson Group)

Group Employees: 3,583. (Axstores Group average number of full-time employees as at 31-12-2010)

Employees: 25. (Hong Kong)

Main Dealing Banker: Skandinaviska Enskilda Banken AB (publ), Hong Kong Branch.

Banking Relation: Good.

ADDRESS

Registered Head Office:-

16/F., The Cameron, 33 Cameron Road, Tsimshatsui, Kowloon, Hong Kong.

Branch Offices: China (Shanghai) and India (New Delhi).

Holding Company:-

Axstores AB

Ringvägen 100, SE-118 90 Stockholm, Sweden.

[Tel: 46 (8) 402 8000; Fax: 46 (8) 402 8008]

Ultimate Holding Company:-

Axel Johnson AB, Sweden.

Affiliated Companies:-

Axstores Group of Companies

Associated with:-

Axel Johnson Group of Companies

Åhléns AB, Sweden.

Axel Johnson Inc., USA.

Axel Johnson International AB, Sweden.

AxFast AB, Sweden.

AxFlow Holding AB, Sweden.

Axfood AB, Sweden.

AxImage AB, Sweden.

AxIndustries AB, Sweden.

Kinetico Inc., USA.

Lagerhaus AB, Sweden.

Mekonomen AB, Sweden.

Nordstjernan AB, Sweden.

Novax AB, Sweden.

Parkson Corporation, USA.

Servera R&S AB, Sweden.

Sprague Energy Corporation, USA.

Svensk BevakningsTjänst AB, Sweden.

etc.

BUSINESS REGISTRATION NUMBER

10713566

COMPANY FILE NUMBER

0176235

MANAGEMENT

General Manager: Ms. Angie Chu

CAPITAL

Nominal Share Capital: HK$10,000.00 (Divided into 1,000 shares of HK$10.00 each)

Issued Share Capital: HK$20.00

SHAREHOLDER

(As per registry dated 10-10-2010)

Name	No. of shares
Axstores AB Ringvägen 100, S-118 90 Stockholm, Sweden.	2 =

DIRECTORS

(As per registry dated 10-10-2010)

Name (Nationality)	Address
Birgitta Christina OLIVENSJÖ	Toivovägen 57, 134 32 Gustavsberg, Sweden.
Leif Åke GÖRANSSON	Egilsvägen 8, SE-191 45 Sollentuna, Sweden.

SECRETARY

(As per registry dated 10-10-2010)

Name	Address	Co. No.
Secreco Ltd.	8/F., Gloucester Tower, The Landmark, 15 Queen’s Road Central, Hong Kong.	0139490

HISTORY

The subject was incorporated on 10th October, 1986 as a private limited liability company under the Hong Kong Companies Ordinance.

Originally the subject was registered under the name of Tareena Trading Ltd., name changed to Ahlens Far East Ltd. on 15th January, 1988, and further to the present style on 23rd November, 2010.

Formerly the subject was located at Room 1001-1002, 10/F., Kimberley Plaza, 45-47 Kimberley Road, Tsimshatsui, Kowloon, Hong Kong, moved to Room 908-909, 9/F., Tower 1, China Hong Kong City, 33 Canton Road, Tsimshatsui, Kowloon, Hong Kong on 15th December, 1997, and further to the present address with effect from 18th December, 2010.

Apart from these, neither material change nor amendment has been ever traced and noted.

OPERATIONS

Activities: Importer, Exporter, Re-exporter, Agent and Representative.

Lines: Garments, other textile products, electronic equipment, cosmetics, and general merchandises.

Group Employees: 3,583. (Axstores Group average number of full-time employees as at 31-12-2010)

Employees: 25. (Hong Kong)

Commodities Imported: Imported from Taiwan, India, Japan, Southeast Asia, China.

Markets: Sweden (main), other European countries, etc.

Group Net Sales:-

Period	Axstores Group	Axel Johnson Group
Year ended 31-12-2007	SEK 5,683 million	SEK 19,557 million
Year ended 31-12-2008	SEK 5,789 million	SEK 19,881 million
Year ended 31-12-2009	SEK 6,202 million	SEK 20,073 million
Year ended 31-12-2010	SEK 6,657 million	SEK 20,899 million

Terms/Sales: Various terms.

Terms/Buying: As per contracted.

FINANCIAL INFORMATION

Nominal Share Capital: HK$10,000.00 (Divided into 1,000 shares of HK$10.00 each)

Issued Share Capital: HK$20.00

Group Net Profit:-

Period	Axstores Group	Axel Johnson Group
Year ended 31-12-2007	SEK 188 million	SEK 880 million
Year ended 31-12-2008	SEK 187 million	SEK 515 million
Year ended 31-12-2009	SEK 216 million	SEK 601 million
Year ended 31-12-2010	SEK 164 million	SEK 650 million

Profit or Loss: Made small profits in the past years.

Condition: Keeping in an active condition.

Facilities: Making active use of general banking facilities.

Payment: Met as contracted.

Commercial Morality: Satisfactory.

Banker: Skandinaviska Enskilda Banken AB (publ), Hong Kong Branch.

Standing: Good.

GENERAL

Axstores Far East Ltd. is a wholly-owned subsidiary of Axstores AB [Axstores] which is a Sweden-based firm.

Formerly known as Ahlens Far East Ltd., the subject was incorporated in October 1986 under the name of Tareena Trading Ltd., name changed to Ahlens Far East Ltd. in January 1988 and became a subsidiary of Åhléns AB [Åhléns] which is a Sweden-based firm. Further changed to the present style on 23 November, 2010. Accordingly, Åhléns changed name to Axstores.

In turn, Axstores is a wholly-owned subsidiary of Axel Johnson AB [Axel Johnson], also a Sweden-based firm.

The subject has just issued 2 ordinary shares of HK$10.00 each. Formerly it was jointly owned by Åhléns and Mr. Joakim Foresell on equal basis. At that time, the subject had two directors including Mr. Joakim Foresell and Mr. Frank Stig Exner. In March 1998, Mr. Foresell transferred his single share to Mr. Dan Thomas Ekberg who was appointed director on 1st January, 1998. Mr. Foresell resigned on 15th February, 1998 accordingly. On 1st March, 2000, Mr. Dan Thomas Ekberg transferred his share to Ms. Eva Susanne Margaret Iding who was immediately appointed director while Mr. Ekberg resigned. On 5th December, 2001, Ms. Iding resigned and she transferred her share to Mr. Bjarne Mumm on 30th January, 2002. Mr. Bjarne Mumm was appointed as director on 9th January, 2002 but now he has resigned. The subject’s current directors are Leif Åke Göransson and Birgitta Christina Olivensjö.

The subject is a regional office of Axstores. It is a buying office for its Swedish parent. It acquires a variety of commodities in the Asia Pacific region as well as from Europe. Besides, Axstores is also a buying office for Anttila of Finland.

Commodities purchased include carpets, garments, leather products, gifts, toys, household accessories, etc. Most of these are sourced from Hong Kong, China, Southeast Asia, India and Taiwan. Prime market is Sweden.

“Åhléns” is one of the well known brands in Sweden and the leading retailer in a number of fields. Operations are focused on four business areas: Mode (Fashion), Skönhet (Beauty), Hem (Homeware) and Media. Within these product groups, Axstores offers a wide range of stylish and trendy products.

In the 90’s, Axstores began a comprehensive transformation into what would become a modern retail chain of high international standard. All its department stores nation wide are gradually being modernised to become attractive department stores.

Axel Johnson AB group is a family company now in the fourth and fifth generations that builds, transforms and develops businesses within retail trading and trading-related services in the European market, with a focus on the Nordic region. Group companies today comprise Axel Johnson International, Novax, Servera, Svensk Bevakningstjänst, Axstores and the partly owned listed companies Axfood and Mekonomen.

Every day more than a million people come into contact with employees or products and services from one of the Axel Johnson companies. The department stores and specialty stores within Axstores alone attract around 300,000 visitors daily, and Axfood, through its network of stores or via franchise-owners, offers food to a large part of Sweden’s population.

Axel Johnson AB group is one of three independent groups in the Axel Johnson Group together with the property company AxFast and the US company Axel Johnson Inc. The Group also has stakes in Nordstjernan. The Axel Johnson Group is owned by Antonia Ax:son Johnson and her family.

Axstores is one of the leading retail groups in Europe. It has about 390 department stores in Sweden, Finland and Norway. The Group has about 5,000 employees and receives over 300,000 customers every day.

In December 2009, the Group opened its first pharmacy in the Skanstull department store in Stockholm.

In FY 2010, the net sales of Axstores Group amounted to SEK 6,657 million (2009: SEK 6,202 million) and profit after financial items was SEK 164 million (2009: SEK 216 million).

For the year ended 31st December, 2010, the Axel Johnson Group’s consolidated sales amounted to SEK 20,899 million (2009: SEK 20,073 million). Group net profit was SEK 650 million (2009: SEK 601 million). The Axel Johnson Group’s financial position remains strong.

In Hong Kong, the subject’s business is mainly handled by Ms. Angie Chu who is also the Merchandise Manager. The subject has set up a branch office in Shanghai, China and New Delhi, India respectively. Business is active and lucrative, the subject is fully supported by its Swedish parent.

On the whole, consider it good for normal business engagements.

COURT CASES: None per our.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.45.24
UK Pound	1	Rs.72.57
Euro	1	Rs.63.00

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%)

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