MIRA INFORM REPORT

Report Date :

26.03.2012

IDENTIFICATION DETAILS

Name :	KLOECKNER PENTAPLAST [THAILAND] LIMITED
Registered Office :	64/48 Moo 4, Eastern Seaboard, Industrial Estate, Pluakdaeng, Rayong 21140
Country :	Thailand
Financials (as on) :	30.09.2011
Date of Incorporation :	2001
Com. Reg. No.:	0105544028493
Legal Form :	Private Limited Company
Line of Business :	Manufacturer, Exporter and Distributor of Plastic Film
No. of Employees :	180

RATING & COMMENTS

MIRA’s Rating :

B

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Maximum Credit Limit :	US$ 1,000,000.
Status :	Moderate
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 – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
Thailand	B1	B1

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

Company name

KLOECKNER PENTAPLAST [THAILAND] LIMITED

SUMMARY

BUSINESS ADDRESS : 64/48 MOO 4, EASTERN SEABOARD

INDUSTRIAL ESTATE, PLUAKDAENG,

RAYONG 21140, THAILAND

TELEPHONE : [66] 38 927-400

FAX : [66] 38 955-462

E-MAIL ADDRESS : kpasia.salesupport@kpfilms.com

REGISTRATION ADDRESS : SAME AS BUSINESS ADDRESS

ESTABLISHED : 2001

REGISTRATION NO. : 0105544028493

CAPITAL REGISTERED : BHT. 780,000,000

CAPITAL PAID-UP : BHT. 780,000,000

SHAREHOLDER’S PROPORTION : FOREIGN : 100%

FISCAL YEAR CLOSING DATE : SEPTEMBER 30

LEGAL STATUS : PRIVATE LIMITED COMPANY

EXECUTIVE : MR. KIATTISAK BOONRUANGTHAVORN, THAI

MANAGING DIRECTOR

NO. OF STAFF : 180

LINES OF BUSINESS : PLASTIC FILM MANAFACTURER, EXPORTER AND DISTRIBUTOR

CORPORATE PROFILE

OPERATING TREND : STABLE

PRESENT SITUATION : OPERATING NORMALLY

REPUTATION : FAIR WITH NORMAL BUSINESS ENGAGEMENT

MANAGEMENT STANDARD : MANAGEMENT WITH LOW PERFORMANC

HISTORY

The subject was established on March 21, 2001 as a private limited company under the name style KLOECKNER PENTAPLAST [THAILAND] LIMITED, by Dutch groups, in order to manufacture hard plastic film mainly for exports. Its production facilities are located in Rayong province. It currently employs approximately 180 staff.

The subject was granted a promotional privilege from Thailand’s Board of Investment [BOI] for the production.

The subject’s registered address was initially located at 10^th Flr., Lake Ratchada Office Complex, 193/36 Ratchadapisek Rd., Klongtoey, Bangkok 10110.

In 2009, the registered address was relocated to 64/48 Moo 4, Eastern Seaboard Industrial Estate, Pluakdaeng, Rayong 21140, and this is the subject’s current operation address.

THE BOARD OF DIRECTORS

Name	Nationality	Age
Mr. Walter Stroeder	German	46
Mr. Kiattisak Boonruangthavorn	Thai	47
Mr. Yongyuth Taweekulwat	Thai	74
Mr. Kamphol Natheethanasarn	Thai	44
Mr. Markus Karl Josef Hoelzl	German	54
Mr. Christian Holtmann	German	54
Mr. Hans Joakim Kogelnic	German	-
Mr. Jean Claude Chendoney	French	-

AUTHORIZED PERSON

Any two of the above directors can jointly sign on behalf of the subject with company’s affixed.

MANAGEMENT

Mr. Kiattisak Boonruangthavorn is the Managing Director.

He is American nationality with the age of 47 years old.

Mr. Kamphol Natheethanasarn is the Sales & Marketing Director.

He is Thai nationality with the age of 44 years old.

Mr. Sonthaya Rajniyom is the Logistics Manager.

He is Thai nationality.

Mr. Nopporn Tankulsawas is the Factory Manager.

He is Thai nationality.

Mr. Nitithep Wongmuneepitak is the Finance Manager.

He is Thai nationality.

BUSINESS OPERATIONS

The subject is engaged in manufacturing and exporting various kinds of hard plastic films including PVC film, PET film, PVC shrinkage and PVC coated film, used in foods, consumer goods, printing and packaging, electronics industries and etc.

BRAND NAME

“KP”

PRODUCTIONS

PVC film : 11,500 tons/year

PET film : 8,500 tons/year

PVC coated film : 3,800 tons/year

PVC shrinkage : 7,500 tons/year

PURCHASE

70% of raw materials mainly resin and chemical are purchased from local suppliers,

the remaining 30% are imported from Japan, Taiwan, Singapore, India and

Republic of China.

MAJOR SUPPLIER

IRPC Public Company Limited : Thailand

EXPORT

90% of the products is exported to over 100 customers mainly in Asia such as Japan, Republic of China, Singapore, Malaysia, Taiwan, Bangladesh, Brunei, India, Laos, Philippines, Vietnam, Cambodia, Myanmar, Indonesia, U.S.A., and etc.

SALES [LOCAL]

10% of the products is also sold locally to manufactures.

MAJOR CUSTOMER

Cloeren Incorporated : U.S.A.

PARENT COMPANY

Kloeckner Pentaplast Netherlands B.V. : Netherlands

SUBSIDIARY AND AFFILIATED COMPANY

The subject is not found to have any subsidiary or affiliated company here in Thailand.

LITIGATION

Bankruptcy and Receivership

There are no litigation on bankruptcy and receivership cases filed against the subject found at Legal Execution Department for the past five years.

Others

There are no legal suits filed against the subject for the past two years.

CREDIT

Sales are by cash or on the credit term of 30 days.

Local bills are paid by cash or on the credit term of 30-60 days.

Imports are by L/C at sight or T/T.

Exports are against L/C at sight or T/T on negotiated term.

BANKING

Bangkok Bank Public Co., Ltd.

[Head Office : 333 Silom Rd., Silom, Bangrak, Bangkok]

Kasikornbank Public Co., Ltd.

[Head Office : 1 Kasikorn Lane, Rajburana Rd., Rajburana, Bangkok]

EMPLOYMENT

The subject employs approximately 180 staff.

LOCATION DETAILS

The premise is rented for administrative office, factory and warehouse at the heading address. Premise is located in industrial area.

Sales Office:

15^th Floor, Lake Ratchada Office Complex, 193/59 Ratchadapisek Rd., Klongtoey, Bangkok 10110. Tel.: [66] 2264-0450, 2264-0105 Fax: [66] 2264-0451

REMARK

MAXIMUM CREDIT SHOULD BE GRANTED AT US$ 1,000,000.

COMMENT

The subject’s operating performance in 2011 was sluggish with a decrease in both sales revenue and net profit comparing to previous year due to shrinkage in demand of the products from various industries and higher cost of goods sold. However, the subject’s sales started picking up in the first quarter of 2012. Moreover, the subject has increased its registered capital & paid-up capital to Bht. 780,000,000 which would also assist the company’s liquidity. Generally, the subject’s business is still promising with a good prospect this year.

FINANCIAL INFORMATION

The capital was registered at Bht. 2,100,000 divided into 21,000 shares of Bht. 100 each.

The capital was increased later as following:

Bht. 150,000,000 on August 15, 2001

Bht. 250,000,000 on November 6, 2003

Bht. 430,000,000 on August 7, 2006

Bht. 630,000,000 on March 28, 2011

Bht. 780,000,000 on October 7, 2011

The latest registered capital was increased to Bht. 780,000,000 divided into 7,800,000 shares of Bht. 100 each with fully paid.

THE SHAREHOLDERS LISTED WERE

[as at January 12, 2012]

NAME	HOLDING	%
Kloeckner Pentaplast Netherlands B.V. Nationality: Dutch Address : Netherlands	7,799,800	100.00
Kloeckner Pentaplast of America Nationality: American Address : Virginia, U. S. A.	100	-
Mr. Kiattisak Boonruangthavorn Nationality: Thai Address : 25/10 Moo 9, Nongprue, Bnaglamung, Chonburi	100	-

Total Shareholders : 3

Share Structure [as at January 12, 2012]

Nationality	Shareholders	No. of Share	% Shares
Thai	1	100	-
Foreign	2	7,799,900	100.00
Total	3	7,800,000	100.00

NAME OF AUDITOR & CERTIFIED PUBLIC ACCOUNTANT NO. :

Mr. Anurak Leelapiyamit No. 3462

BALANCE SHEET [BAHT]

The latest financial figures published for September 30, 2011 & 2010 were:

ASSETS

[Thousand Baht]

Current Assets	2011	2010
Cash in hand & at Bank	147,149	10,394
Trade Accounts Receivable	182,843	162,857
Trade Accounts Receivable-Person & Related Company	55,379	22,131
Person or Related Company Receivable	65,430	7,970
Inventories	184,472	102,435
Prepayment for Assets under Construction	-	143,729
Other Current Assets	28,079	19,201
Total Current Assets	663,352	468,717
Fixed Assets	1,395,585	857,453
Deferred Income Tax	34,271	35,189
Deposit	1,075	1,131
Total Assets	2,094,283	1,362,490

LIABILITIES & SHAREHOLDERS' EQUITY [BAHT]

[Thousand Baht]

Current Liabilities	2011	2010
Bank Overdraft & Short-term Loan from Financial Institution	153,934	136,500
Trade Accounts Payable	147,995	154,594
Trade Accounts Payable - Related Company	31,242	36,416
Person or Related Company Payable	193,913	115,141
Current Portion of Other Long-term Loan	200,000	100,000
Pre-received Share from Person or Related Company	153,300	-
Construction Payable	12,330	44,042
Accrued Expenses	42,565	40,451
Other Current Liabilities	21,563	28,973
Total Current Liabilities	956,842	656,117
Other Long-term Loan - Net of Current Portion	450,000	120,000
Total Liabilities	1,406,842	776,117
Shareholders' Equity
Share capital : Baht 100 par value authorized, issued and fully paid share capital 6,300,000 & 4,300,000 shares in 2011 & 2010 respectively	630,000	430,000
Capital Paid	630,000	430,000
Unrealized Gain [ Loss] Surplus on Assets Appraisal	62,489	71,244
Retained Earning - Unappropriated [Deficit]	[5,048]	85,129
Total Shareholders' Equity [Deficit]	687,441	586,373
Total Liabilities & Shareholders' Equity	2,094,283	1,362,490

PROFIT & LOSS ACCOUNT

[Thousand Baht]

Revenue	2011	2010
Sales	1,328,522	1,408,464
Other Income	14,910	8,469
Total Revenues	1,343,432	1,416,933
Expenses
Cost of Goods Sold	1,216,440	1,157,216
Selling Expenses	115,518	112,519
Administrative Expenses	82,064	76,980
Total Expenses	1,414,022	1,346,715
Profit / [Loss] before Interest Expenses & Income Tax	[70,590]	70,218
Interest Expenses	[27,424]	[16,616]
Profit/[Loss] before Income Tax	[98,014]	53,602
Income Tax	[918]	[208]
Net Profit / [Loss]	[98,932]	53,394

FINANCIAL ANALYSIS

ITEM	UNIT	2011	2010
LIQUIDITY RATIO
CURRENT RATIO	TIMES	0.69	0.71
QUICK RATIO	TIMES	0.47	0.53
ACTIVITY RATIO
FIXED ASSETS TURNOVER	TIMES	0.95	1.64
TOTAL ASSETS TURNOVER	TIMES	0.63	1.03
INVENTORY CONVERSION PERIOD	DAYS	55.35	32.31
INVENTORY TURNOVER	TIMES	6.59	11.30
RECEIVABLES CONVERSION PERIOD	DAYS	50.23	42.20
RECEIVABLES TURNOVER	TIMES	7.27	8.65
PAYABLES CONVERSION PERIOD	DAYS	44.41	48.76
CASH CONVERSION CYCLE	DAYS	61.18	25.75
PROFITABILITY RATIO
COST OF GOODS SOLD	%	91.56	82.16
SELLING & ADMINISTRATION	%	14.87	13.45
INTEREST	%	2.06	1.18
GROSS PROFIT MARGIN	%	9.56	18.44
NET PROFIT MARGIN BEFORE EX. ITEM	%	(5.31)	4.99
NET PROFIT MARGIN	%	(7.45)	3.79
RETURN ON EQUITY	%	(14.39)	9.11
RETURN ON ASSET	%	(4.72)	3.92
EARNING PER SHARE	BAHT	(15.70)	12.42
LEVERAGE RATIO
DEBT RATIO	TIMES	0.67	0.57
DEBT TO EQUITY RATIO	TIMES	2.05	1.32
TIME INTEREST EARNED	TIMES	(2.57)	4.23
ANNUAL GROWTH
SALES GROWTH	%	(5.68)
OPERATING PROFIT	%	(200.53)
NET PROFIT	%	(285.29)
FIXED ASSETS	%	62.76
TOTAL ASSETS	%	53.71

PROFITABILITY RATIO

Gross Profit Margin	9.56	Acceptable	Industrial Average	14.47
Net Profit Margin	(7.45)	Deteriorated	Industrial Average	2.07
Return on Assets	(4.72)	Deteriorated	Industrial Average	2.75
Return on Equity	(14.39)	Deteriorated	Industrial Average	6.20

Gross Profit Margin used to assess a firm's financial health by revealing the proportion of money left over from revenues after accounting for the cost of goods sold. Gross profit margin serves as the source for paying additional expenses and future savings. The company's figure is 9.56%. When compared with the industry average, the ratio of the company was lower. This indicated that company was originated from the problems with control over its costs.

Net Profit Margin is the indicator of the company's efficiency in that net profit takes into consideration all expenses of the company. A low profit margin indicates a low margin of safety, higher risk that a decline in sales will erase profits and result in a net loss. The company's figure is -7.45%. When compared with the industry average, the ratio of the company was lower.

Return on Assets measures how efficiently profits are being generated from the assets employed in the business when compared with the ratios of firms in a similar business. A low ratio in comparison with industry averages indicates an inefficient use of business assets. When compared with the industry average, it was lower, the company's figure is -4.72%.

Return on Equity indicates how profitable a company is by comparing its net income to its average shareholders' equity, ROE measures how much the shareholders earned for their investment in the company. When compared with the industry average, it was lower, the company's figure is -14.39%.

Trend of the average competitors in the same industry for last 5 years

Return on Assets Uptrend

Return on Equity Downtrend

LIQUIDITY RATIO

Current Ratio	0.69	Risky	Industrial Average	1.26
Quick Ratio	0.47
Cash Conversion Cycle	61.18

The Current Ratio is to ascertain whether a company's short-term assets are readily available to pay off its short-term liabilities. The company's figure is 0.69 times in 2011, decrease from 0.71 times, then the company may not be efficiently using its current assets. When compared with the industry average, the ratio of the company was lower.

The Quick Ratio is a liquidity indicator that further refines the current ratio by measuring the amount of the most liquid current assets there are to cover current liabilities. The company's figure is 0.47 times in 2011, decrease from 0.53 times, then the company has not enough current assets that presumably can be quickly converted to cash for pay financial obligations.

The Cash Conversion Cycle measures the number of days a company's cash is tied up in the production and sales process of its operations and the benefit from payment terms from its creditors. It meant the company could survive when no cash inflow was received from sale for 62 days.

Trend of the average competitors in the same industry for last 5 years

Current Ratio Uptrend

LEVERAGE RATIO

Debt Ratio	0.67	Acceptable	Industrial Average	0.56
Debt to Equity Ratio	2.05	Risky	Industrial Average	1.26
Times Interest Earned	(2.57)	Risky	Industrial Average	2.85

Debt to Equity Ratio a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. A lower the percentage means that the company is using less leverage and has a stronger equity position.

Times Interest Earned measuring a company's ability to meet its debt obligations. Ratio is -2.58 lower than 1, so the company is not generating enough cash from EBIT to meet its interest obligations.

Debt Ratio shows the proportion of a company's assets which are financed through debt. The company's figure is 0.67 greater than 0.5, most of the company's assets are financed through debt.

Trend of the average competitors in the same industry for last 5 years

Debt Ratio Downtrend

Times Interest Earned Uptrend

ACTIVITY RATIO

Fixed Assets Turnover	0.95	Deteriorated	Industrial Average	2.61
Total Assets Turnover	0.63	Deteriorated	Industrial Average	1.28
Inventory Conversion Period	55.35
Inventory Turnover	6.59	Impressive	Industrial Average	6.32
Receivables Conversion Period	50.23
Receivables Turnover	7.27	Impressive	Industrial Average	4.79
Payables Conversion Period	44.41

Trend of the average competitors in the same industry for last 5 years

Fixed Assets Turnover Uptrend

Total Assets Turnover Downtrend

Inventory Turnover Uptrend

Receivables Turnover Uptrend

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.50.90
UK Pound	1	Rs.80.77
Euro	1	Rs.67.40

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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