MIRA INFORM REPORT

Report Date :

20.06.2012

IDENTIFICATION DETAILS

Name :	DIRECT GROUP PTY LIMITED
Formerly Known As :	INTERFINE HOLDINGS PTY LIMITED
Registered Office :	431 Warringah Road, Frenchs Forest, New South Wales, Zip/postal code 2086
Country :	Australia
Financials (as on) :	30.06.2011
Date of Incorporation :	29.06.1994
Com. Reg. No.:	065432199
Legal Form :	Australian Proprietary Company
Line of Business :	Multi-channel retailer.
No. of Employees :	248 employees

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 :	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 – March 31^st, 2012

Country Name	Previous Rating (31.12.2011)	Current Rating (31.03.2012)
Australia	a1	a1

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

Bottom of Form

Identification details Bottom of Form

Verified Address

Subject name : DIRECT GROUP PTY LIMITED

Business address : 431 Warringah Road

Town : Frenchs Forest

Province : New South Wales

Zip/postal code : 2086

Country : Australia

Tel : +61 2 90044111

Fax : +61 2 90044239

Website : www.directgroup.com.au

Registered address : 431 Warringah Road

Town : Frenchs Forest

Province : New South Wales

Zip/postal code : 2086

Country : Australia

Summary details

Executive Summary

Date founded or registered : 29/06/1994

Legal form : Australian Proprietary Company

Chief executive : Christopher Robert Shaw

Issued & paid up capital : AUD 17,795,404

Sales turnover : AUD 169,009,000 (Consolidated 12 months, 30/06/2011)

Net income : AUD 10,893,000 (Consolidated 12 months, 30/06/2011)

Total fixed assets : AUD 78,587,000 (Consolidated 12 months, 30/06/2011)

Line of business : Multi-channel retailer.

Staff employed : 248 employees (Subject)

Credit risk opinion

Company Analysis

Country risk : Country risk is minimal

Operation trend : Operational trend is steady

Management experience : Management is adequately experienced

Financial performance : Financial performance is good

Organization structure : Organizational structure is stable

Detrimental : No detrimental records found

Payment history : No payment delays noted

Statutory details

Registry Data

Registration date : 29/06/1994

Legal form : Australian Proprietary Company

Registration no Australian Company Number: 065432199

Registered authority : Australian Securities and Investments Commission

Fiscal/ Tax no : Australian Business Number: 45065432199

Registry status : Live/Active

Previous name : INTERFINE HOLDINGS PTY LIMITED

INNOVATIONS HOLDINGS PTY LIMITED

VAREDON PTY. LIMITED (initial)

Change of legal form : None reported.

Management / directors

Key Management

Name : Christopher Robert Shaw

Designation : Managing Director

Name : Graham Alexander Shaw

Designation : Director

Board of directors / other appointments

Appointments

Name : Christopher Robert Shaw

Designation : Director

Appointment date : 29/06/94

Address : 73 Muston Street

Mosman, NSW 2088

Australia

Biography : Born on 29/01/1949 in Durban, South Africa.

Name : Peter Gordon Watts

Designation : Director

Appointment date : 15/12/95

Address : Maidensgrove Farm, Maidensgrove

Henley-On Thames

Oxon RG9 6HA

United Kingdom

Biography : Born on 23/03/1938 in Henley, United Kingdom.

Name : Graham Alexander Shaw

Designation : Director

Appointment date : 04/05/06

Address : Unit 2, 31 Dress Circle Drive

Lennox Head, NSW 2478

Australia

Biography : Born on 06/10/1946 in Durban, South Africa.

Name : Robert Thane Ewing

Designation : Company Secretary

Appointment date : 20/05/96

Address : Unit 3, 10 Badajoz Road

North Ryde, NSW 2113

Biography : Born on 05/10/1938 in Sydney, New South Wales, Australia.

Name : Steven John Hodgson

Designation : Company Secretary

Appointment date : 17/11/04

Address : 19 Baringa Road

Northbridge, NSW 2063

Australia

Biography : Born on 11/11/1963 in York, United Kingdom.

Staff employed : 248 employees (Subject)

Key Advisors

Auditors : ERNST & YOUNG

680 George Street

Sydney, NSW 2000

Australia

Share capital

Composition

Authorized Capital : AUD 17,795,404

No of shares : 82,202,340 Ordinary Shares

Share par value : No par value

Issued capital : AUD 17,795,404

Paid up capital : AUD 17,795,404

ownership / shareholders

How listed : Full List

Composition

Shareholder name : ITF EMPLOYEE SHARE PLAN MANAGERS PTY LTD

Address : Level 11, 99 York Street

Sydney, NSW 2000

Australia

No. of shares : 6,247,500 Ordinary Shares

Shareholder name : INTERFINE INVESTMENTS PTY LIMITED

Address : 431 Warringah Road

Frenchs Forest, NSW 2086

Australia

No. of shares : 36,609,920 Ordinary Shares

Shareholder name : ROTHERLEIGH HOLDINGS BV

Address : Herikerbergweg 238, Luna Arena

1101 CM Amsterdam-Zuidoost

The Netherlands

No. of shares : 36,444,920 Ordinary Shares

Shareholder name : HEDMAR INVESTMENTS PTY. LTD.

Address : C/O GMK PARTNERS PTY LTD

Level 27, 150 Lonsdale Street

Melbourne, VIC 3000

Australia

No. of shares : 2,900,000 Ordinary Shares

Related companies & corporate Affiliations

Structure

Name : TVSN CHANNEL PTY LTD

Affiliation type : Wholly-owned Subsidiary

Address : 431 Warringah Road

Frenchs Forest, NSW 2086

Australia

Name : INNOVATIONS DIRECT PTY LTD

Affiliation type : Wholly-owned Subsidiary

Address : 431 Warringah Road

Frenchs Forest, NSW 2086

Australia

Name : HOMECARE DIRECT SHOPPING PTY LTD

Affiliation type : Wholly-owned Subsidiary

Address : 431 Warringah Road

Frenchs Forest, NSW 2086

Australia

Name : DAMART AUSTRALIA PTY LIMITED

Affiliation type : Wholly-owned Subsidiary

Address : 431 Warringah Road

Frenchs Forest, NSW 2086

Australia

Name : EXPO NETWORK PTY LIMITED

Affiliation type : Wholly-owned Subsidiary

Address : 431 Warringah Road

Frenchs Forest, NSW 2086

Australia

Bank & mortgages

Bank Details

Name of bank : Commonwealth Bank Of Australia

Address : Australia

Account details : Current Account

Comments : It is generally not the policy of local banks to provide credit status information to

non related parties, however interested parties would be advised to consult first

with the Subject if banker's references are required.

Mortgages : None reported.

Legal Fillings

Bankruptcy fillings : None reported.

Court judgements : None reported.

Tax liens : None reported.

Others : None reported.

financial data

Description

Source of financial statement : Commercial Registry Filings

Financial statement date : 30/06/11

Type of accounts : Full audited

Currency : Australia Dollar (AUD)

Exchange rate : 1 USD = AUD 0.98 as of 20-06-2012

Summarized Financial Information

Consolidation type : Consolidated Consolidated

Currency : Australia Dollar (AUD) Australia Dollar (AUD)

Denomination : (x1) One (x1) One

Date of financial year end : 30/06/11 30/06/10

Length of accounts : 12 months 12 months

Sale turnover / Income : 169,009,000 161,329,000

Gross profit : 81,994,000 74,361,000

Profit before tax : 13,148,000 8,857,000

Net income : 10,893,000 6,305,000

Non current assets : 37,870,000 39,202,000

Current assets 40,717,000 46,360,000

Inventories : 17,978,000 16,818,000

Total assets : 78,587,000 85,562,000

Current liabilities : 27,534,000 30,306,000

Non current liabilities : 4,347,000 5,405,000

Total liabilities : 31,881,000 35,711,000

Share equity : 46,706,000 49,851,000

Reserve : 249,000 462,000

Retained earning : 27,952,000 31,159,000

Comments : The consolidated financial information above relates to the Subject and its subsidiaries.

Operation details

Main activities :

The Subject is a multi-channel retailer in Australia and New Zealand.

The key emphasis of the group is to interact directly with its customers,

utilizing websites, emails, catalogues and other printed material, television

and distributors.

Subject's business is divided into 3 - Direct Marketing, Direct Selling and Direct Television

Direct Marketing

The Group’s original business unit, Innovations, has since expanded to

include an additional five brands - Damart, Fox Collection, Victoria Hill,

Entertainment Masters and Gaiam. Each brand offers unique product

ranges servicing different customer demographics through their Australian

and New Zealand websites supported by catalogues, emails, online

promotions and other marketing activities.

Direct Television

The TVSN and EXPO channels broadcast 24 hour shopping content on the

Foxtel, Austar and Optus subscription TV services in Australia, as well as a

live stream to their in-house websites. TVSN provides live TV shopping,

showcasing a wide variety of merchandise in beauty, health, homewares,

jewellery, fashion and electrical. EXPO’s business model is to sell airtime

to external Direct Response TV advertisers in 30 second, 4 minute and half

hour formats.

Direct Selling

HomeCare works through a network of over 1,500 commissioned agents

distributing catalogues direct to households throughout Australia and New

Zealand. Customer orders are entered by distributors online, allowing an

accurate mapping of the customer database to support future distributor

activity.

Business Units:

Innovations - Innovative general merchandise, furniture, gifts and bedding

Damart- Mature women's apparel and thermalwear for all

The Fox Collection - Needlework and craft

Gaiam - Lifestyle of health and sustainability

Entertainment Masters - Packaged home entertainment

Victoria Hill - Women's fashion apparel, shoes and accessories

Homecare - Small kitchen appliances, homewares and personal items

TVSN - Jewellery, beauty, health, electrical and homewares

Product & services :

Consumer good

Homecare products

Apparel

Jewellery

Beauty products

General merchandise

Furniture, gifts and bedding products

Electrical products

page 12 / 16

Needlework and craft products

Health products

Purchases

International : Worldwide

Sales

Local : Yes

International : No exports

Property & Assets

Premises : The Subject operates from premises located at the verified heading address consisting of

an administrative office and warehouse.

Branches : None reported.

Summarized country risk

Central bank : Reserve Bank of Australia

Reserve of foreign exchange & gold : US$ 41.385 billion

Gross domestic product – GDP : US$ 1.235 trillion

GPP (Purchasing power parity) : 918.529 billion of International dollars

GDP per capita - current prices : US$ 55,590

GDP - composition by sector : agriculture: 4.1% industry: 26% services: 70%

Inflation : 2008: 4.4%

2009: 1.8%

2010: 2.8%

Unemployment rate 2008: 4.2 %

2009: 5.6 %

2010:5.2 %

Public debt

(General Government gross

debt as a % GDP) 2008: 11.6%

2009: 17.6%

_{2010: 22.3 %}

Government bond ratings Standard & Poor's: AAA-/Stable/A-1+

Moody's rating: Aaa

Moody's outlook: STA

Market value of publicly traded shares US$ 1.258 trillion

Largest companies in the country Commonwealth Bank (Banking), BHP Billiton (Materials), Westpac

Banking Group (Banking), Rio Tinto (Materials), National Australia Bank (Banking), ANZ Banking (Banking), Telstra (Telecommunications)

Trade & Competitiveness Overview

Total exports US$210.7 billion

Exports commodities coal, iron ore, gold, meat, wool, alumina, wheat

Total imports US$187.2 billion

Imports commodities machinery and transport equipment, computers and office machines, telecommunication equipment and parts, crude oil and petroleum products

Export - major partners Japan 18.9%, China 14.2%, South Korea 8%, US 6%, NZ 5.6%, India

5.5%, UK 4.2%

Import - major partners China 15.5%, US 12.8%, Japan 9.6%, Singapore 5.6%, Germany

5.2%, UK 4.3%, Thailand 4.2%

FDI Inflows 2007: US$45,477 million

2008: US$46,722 million

_{2009: US$22,572 million}

_{FDI Outflows} 2007: US$16,822 million

2008: US$32,819 million

2009: US$18,426 million

Best countries for doing business : 10 out of 183 countries

Global competitiveness ranking : 16 (ranking by country on a basis of 133, the first is the best)

Country and Population Overview

Total population : 22.23 million

Total area : 7,692,024 km2

Capital : Canberra

_{Currency : Australian Dollars (AUD)}

Internet users as % of total population : 74.00%

Payment history

Purchase Term

International : L/C, Bank transfer, Credit 30-90 days

Sales Term

Local : Credit card

Trade Reference/ Payment Behaviour

Comments : As local and international trade references were not supplied, the Subject's

payment track record history cannot be appropriately determined but based

on our research, payments are believed to be met without delay.

Investigation Note

Sources : Interviews and material provided by the Subject

: Other official and local business sources

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.56.01
UK Pound	1	Rs.87.85
Euro	1	Rs.70.54

INFORMATION DETAILS

Report Prepared by :

MNL

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.