MIRA INFORM REPORT

 

 

Report Date :

19.11.2012

 

IDENTIFICATION DETAILS

 

Name :

WEAR SAFE (MALAYSIA) SDN BHD

 

 

Registered Office :

82-F, Jalan Pulasan, 41000 Klang, Selangor

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2010

 

 

Date of Incorporation :

18.09.1990

 

 

Com. Reg. No.:

204396-X

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Manufacturing Of Surgical, Procedure And Examination Gloves

 

 

No. of Employees :

500

 

 

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 – June 30th, 2012

 

Country Name

Previous Rating

(31.03.2012)

Current Rating

(30.06.2012)

Malaysia

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

malaysia - ECONOMIC OVERVIEW

 

Malaysia, a middle-income country, has transformed itself since the 1970s from a producer of raw materials into an emerging multi-sector economy. Under current Prime Minister NAJIB, Malaysia is attempting to achieve high-income status by 2020 and to move farther up the value-added production chain by attracting investments in Islamic finance, high technology industries, biotechnology, and services. The NAJIB administration also is continuing efforts to boost domestic demand and reduce the economy's dependence on exports. Nevertheless, exports - particularly of electronics, oil and gas, palm oil and rubber - remain a significant driver of the economy. As an oil and gas exporter, Malaysia has profited from higher world energy prices, although the rising cost of domestic gasoline and diesel fuel, combined with strained government finances, has forced Kuala Lumpur to begin to reduce government subsidies. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplies more than 40% of government revenue. The central bank maintains healthy foreign exchange reserves, and a well-developed regulatory regime has limited Malaysia''s exposure to riskier financial instruments and the global financial crisis. Nevertheless, Malaysia could be vulnerable to a fall in commodity prices or a general slowdown in global economic activity because exports are a major component of GDP. In order to attract increased investment, NAJIB has raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but he has encountered significant opposition, especially from Malay nationalists and other vested interests.

 

Source : CIA

EXECUTIVE SUMMARY

 

 

 

REGISTRATION NO.

:

204396-X

COMPANY NAME

:

WEAR SAFE (MALAYSIA) SDN BHD

FORMER NAME

:

WUHRLIN SOPLAMED (M) SDN BHD (06/12/1996)
VECTRON SDN BHD (20/11/1990)

INCORPORATION DATE

:

18/09/1990

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

82-F, JALAN PULASAN, 41000 KLANG, SELANGOR, MALAYSIA.

BUSINESS ADDRESS

:

LOT 13726, JALAN HAJI SALLEH, BATU 5 1/4, OFF JALAN MERU, 41050 KLANG, SELANGOR, MALAYSIA.

TEL.NO.

:

03-33923088

FAX.NO.

:

03-33928126

CONTACT PERSON

:

LIM LENG BUNG ( DIRECTOR )

 

 

 

INDUSTRY CODE

:

25193

PRINCIPAL ACTIVITY

:

MANUFACTURING OF SURGICAL, PROCEDURE AND EXAMINATION GLOVES

AUTHORISED CAPITAL

:

MYR 6,000,000.00 DIVIDED INTO 
ORDINARY SHARE 6,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 5,000,000.00 DIVIDED INTO 
ORDINARY SHARES 2,300,002 CASH AND 2,699,998 OTHERWISE OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 237,012,492 [2010]

NET WORTH

:

MYR 43,141,659 [2010]

 

 

 

STAFF STRENGTH

:

500 [2012]

BANKER (S)

:

EON BANK BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

FAIR

PAYMENT

:

AVERAGE

MANAGEMENT CAPABILITY

:

GOOD

 

 

 

COMMERCIAL RISK

:

MODERATE

CURRENCY EXPOSURE

:

HIGH

GENERAL REPUTATION

:

GOOD

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

 

 

HISTORY / BACKGROUND

 

The SC is a private limited company and is allowed to have a minimum of one and a maximum of forty-nine shareholders. As a private limited company, the SC must have at least two directors. A private limited company is a separate legal entity from its shareholders. As a separate legal entity, the SC is capable of owning assets, entering into contracts, sue or be sued by other companies. The liabilities of the shareholders are to the extent of the equity they have taken up and the creditors cannot claim on shareholders' personal assets even if the SC is insolvent. The SC is governed by the Companies Act, 1965 and the company must file its annual returns, together with its financial statements with the Registrar of Companies.

 

The SC is principally engaged in the (as a / as an) manufacturing of surgical, procedure and examination gloves.

The SC is not listed on Bursa Malaysia (Malaysia Stock Exchange).

The immediate holding company of the SC is ENVI-CARE SDN BHD, a company incorporated in MALAYSIA.

The ultimate holding company of the SC is KOSSAN HOLDINGS (M) SDN BHD, a company incorporated in MALAYSIA.

 

The major shareholder(s) of the SC are shown as follows :

Name

Address

IC/PP/Loc No

Shareholding

(%)

ENVI-CARE SDN BHD

LOT 782, JALAN SUNGAI PUTUS, OFF BATU 3 3/4, JALAN KAPAR, 42100 KLANG, SELANGOR, MALAYSIA.

203470

5,000,000.00

100.00

 

 

 

---------------

------

 

 

 

5,000,000.00

100.00

 

 

 

============

=====

 

 

DIRECTORS

 

+ Also Director

 

DIRECTOR 1

 

Name Of Subject

:

MR. LIM KWAN HWA

Address

:

4, JALAN PJS 9/1C, BANDAR SUNWAY, 46150 PETALING JAYA, SELANGOR, MALAYSIA.

IC / PP No

:

3676243

New IC No

:

500801-10-5963

Date of Birth

:

01/08/1950

 

 

 

Nationality

:

MALAYSIAN CHINESE

Date of Appointment

:

26/08/2003

 

 

 

 

 

 

Working Experience

:

JOINED KOSSAN LATEX INDUSTRIES (M) S/B IN 1988 & WAS IN CHARGE OF PRODUCTION & FACTORY MAINTENANCE. CURRENTLY HE IS IN CHARGE OF THE GLOVE PRODUCTION OF THE GROUP WITH SPECIAL RESPONSIBILITY IN PLANNING & CONTROL.

 

 

 

 

DIRECTOR 2

 

Name Of Subject

:

MR. LIM LENG BUNG

Address

:

1, JALAN SENTOSA 64, OFF JALAN MERU, 41050 KLANG, SELANGOR, MALAYSIA.

IC / PP No

:

6988137

New IC No

:

630105-10-6917

Date of Birth

:

05/01/1963

 

 

 

Nationality

:

MALAYSIAN CHINESE

Date of Appointment

:

26/08/2003

 

 

 

 

 

 

Working Experience

:

HEAD OF PRODUCTION & FACTORY ADMIN IN KOSSAN RUBBER INDUSTRIES BHD. JOINED THE CO IN NOV 1983 AS A TRAINEE IN THE PRODUCTION SHOP FLOOR & ACQUIRED EXTENSIVE SKILLS & KNOWLEDGE IN PRODUCTION PROCESSES & FACTORY MGTE WHILE SERVING IN THE VARIOUS POSITIONS

 

 

 

 

DIRECTOR 3

 

Name Of Subject

:

MR. LIM SIENG BING

Address

:

12A, JALAN COKMAR 2D, MUTIARA BUKIT RAJA, 41050 KLANG, SELANGOR, MALAYSIA.

 

 

 

New IC No

:

811003-02-5799

Date of Birth

:

03/10/1981

 

 

 

Nationality

:

MALAYSIAN CHINESE

Date of Appointment

:

03/01/2003

 

 

 

 

 

 

 

 

 

 

 

 


MANAGEMENT

 

 

 

1)

Name of Subject

:

LIM LENG BUNG

 

Position

:

DIRECTOR

 

 

 

 

 

 

 

AUDITOR

 

Auditor

:

KPMG

Auditor' Address

:

KPMG TOWER, 8 FIRST AVENUE, BANDAR UTAMA, LEVEL 10, 47800 PETALING JAYA, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. CHIA ONG LEONG

 

IC / PP No

:

4963056

 

New IC No

:

560317-10-5405

 

Address

:

10,LEBOH JERANGOR, TAMAN CHI LIUNG, 41200 KLANG, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

2)

Company Secretary

:

MS. HIAN BEE GEOK

 

IC / PP No

:

5611529

 

New IC No

:

590118-10-6840

 

Address

:

10,LEBUH JERANGOR, TAMAN CHI LIUNG, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

3)

Company Secretary

:

MR. CHIA KIA HOCK

 

IC / PP No

:

6312148

 

New IC No

:

611105-10-5005

 

Address

:

3T,JALAN SUNGAI BERTIK, 41100 KLANG, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

EON BANK BHD

 

 

 

 

 

The SC enjoys normal banking routine with above mentioned banker(s). The SC has bank charges with above mentioned banker(s).

 

 

ENCUMBRANCE (S)


No encumbrance was found in our databank at the time of investigation. 

 

 

LEGAL CHECK AGAINST SC


* A check has been conducted in our databank againt the SC whether the subject has been involved in any litigation. Our databank consists of 99% of the wound up companies in Malaysia.

No legal action was found in our databank. 

No winding up petition was found in our databank. 

 

DEFAULTER CHECK AGAINST SC


* We have checked through the SC in our defaulters' database which comprised of debtors that have been blacklisted by our customers and debtors that have been placed or assigned to us for collection since 1990. Information was provided by third party where the debt amount can be disputed. Please check with creditors for confirmation as alleged debts may have been paid since recorded or are being disputed. 

No blacklisted record & debt collection case was found in our defaulters' databank. 

 

PAYMENT RECORD

 

 

SOURCES OF RAW MATERIALS:

 

Local

:

YES

Percentage

:

70%

Overseas

:

YES

Percentage

:

30%

Import Countries

:

ASIA


The SC refused to provide any name of trade/service supplier and we are unable to conduct any trade enquiry. However, from financial historical data we conclude that :

OVERALL PAYMENT HABIT

Prompt 0-30 Days

[

 

]

 

Good 31-60 Days

[

 

]

 

Average 61-90 Days

[

X

]

 

Fair 91-120 Days

[

 

]

 

Poor >120 Days

[

 

]

 

 

 

 

 

 

 

 

CLIENTELE

 

Local

:

NO

Percentage

:

0%

 

 

 

 

 

 

Overseas

:

YES

Percentage

:

100%

Export Market

:

UNITED STATES, EUROPE

Credit Term

:

30 DAYS

 

 

 

 

 

 

Payment Mode

:

LETTER OF CREDIT (LC)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Products manufactured

:

MEDICAL GLOVES

 

 

 

Competitor(s)

:

KOSSAN RUBBER INDUSTRIES BHD
LATEXX PARTNERS BHD
SUPERMAX CORPORATION BHD
TOP GLOVE CORPORATION BHD
WRP ASIA PACIFIC SDN BHD

 

 

 

 

 

 

 

 

Member(s) / Affiliate(s)

:

MALAYSIAN RUBBER GLOVE MANUFACTURERS ASSOCIATION (MRGMA)

SMI ASSOCIATION OF MALAYSIA

 

 

 

Ownership of premises

:

OWNED

 

Shifts

:

3 (24 HOURS OPERATING)

 

 

 

 

 

Total Number of Employees:

 

YEAR

2012

2011

2010

2009

2008

2007

 

 

 

 

GROUP

N/A

N/A

N/A

N/A

N/A

N/A

 

 

 

COMPANY

500

500

500

450

380

250

 

 

 

 

Branch

:

NO

 

Other Information:


The SC is principally engaged in the (as a / as an) manufacturing of surgical, procedure and examination gloves.

The SC is principally involved in the manufacturing of high quality medical gloves.

The SC produces a wide range of products including surgical gloves, nitrile gloves, clean room gloves, examination gloves etc.

The SC also produces surgeon's glove powdered or powder free, sterile and other surgical gloves.


PROJECTS


No projects found in our databank 

 

CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the SC indicated that :

Telephone Number Provided By Client

:

333923984

Current Telephone Number

:

03-33923088

Match

:

NO

 

 

 

Address Provided by Client

:

LOT 13726, JALAN HAJI SALLEH, BATU 5 1/4, OFF JALAN MERU,41050,KLANG,SELANGOR.

Current Address

:

LOT 13726, JALAN HAJI SALLEH, BATU 5 1/4, OFF JALAN MERU, 41050 KLANG, SELANGOR, MALAYSIA.

Match

:

YES

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations


On 8th November 2012 we contacted Ms Wong from the Accounts Department. She provided some information on the SC.


FINANCIAL ANALYSIS

 

 

Profitability

 

 

 

 

 

 

Turnover

:

Increased

[

2007 - 2010

]

 

Profit/(Loss) Before Tax

:

Increased

[

2007 - 2010

]

 

Return on Shareholder Funds

:

Favourable

[

36.23%

]

 

Return on Net Assets

:

Favourable

[

43.32%

]

 

 

 

 

 

 

 

 

The SC's turnover increased steadily as the demand for its products / services increased due to the goodwill built up over the years.The higher profit could be attributed to the increase in turnover. Generally the SC was profitable. The favourable return on shareholders' funds and return on net assets indicate that the SC's management was efficient in utilising the assets to generate returns.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Favourable

[

26 Days

]

 

Debtor Ratio

:

Favourable

[

37 Days

]

 

Creditors Ratio

:

Favourable

[

15 Days

]

 

 

 

 

 

 

 

 

The SC's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. The favourable debtors' days could be due to the good credit control measures implemented by the SC. The SC had a favourable creditors' ratio as evidenced by its favourable collection days. The SC could be taking advantage of the cash discounts and also wanting to maintain goodwill with its creditors.

 

 

 

 

 

 

 

Liquidity

 

 

 

 

 

 

Liquid Ratio

:

Unfavourable

[

0.53 Times

]

 

Current Ratio

:

Unfavourable

[

0.73 Times

]

 

 

 

 

 

 

 

 

A low liquid ratio means that the SC may be facing working capital deficiency. If the SC cannot obtain additional financing or injection of fresh capital, it may face difficulties in meeting its short term obligations.

 

 

 

 

 

 

 

Solvency

 

 

 

 

 

 

Interest Cover

:

Favourable

[

32.82 Times

]

 

Gearing Ratio

:

Favourable

[

0.14 Times

]

 

 

 

 

 

 

 

 

The interest cover showed that the SC was able to service the interest. The favourable interest cover could indicate that the SC was making enough profit to pay for the interest accrued. The SC was lowly geared thus it had a low financial risk. The SC was mainly financed by its shareholders' funds and internally generated funds. In times of economic slowdown / downturn, the SC being a lowly geared company, will be able to compete better than those companies which are highly geared in the same industry.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall Assessment :

 

 

 

 

 

 

Generally, the SC's performance has improved with higher turnover and profit. Due to its weak liquidity position, the SC will be faced with problems in meeting all its short term obligations if no short term loan is obtained or additional capital injected into the SC. With the favourable interest cover, the SC could be able to service all the accrued interest without facing any difficulties. The SC as a lowly geared company, will be more secured compared to those highly geared companies. It has the ability to meet all its long term obligations.

 

 

 

 

 

 

 

Overall financial condition of the SC : FAIR

 

 

 

MALAYSIA ECONOMIC / INDUSTRY OUTLOOK

 

Major Economic Indicators:

2008

2009

2010

2011*

2012**

 

 

 

 

 

 

Population ( Million)

27.73

28.13

28.35

28.70

29.10

Gross Domestic Products ( % )

4.6

<0.5>

7.2

5.5

5.3

Domestic Demand ( % )

6.9

2.9

6.3

4.8

7.6

Private Expenditure ( % )

7.1

<2.7>

8.1

7.0

8.7

Consumption ( % )

8.4

0.7

6.7

6.3

7.1

Investment ( % )

1.5

<17.2>

17.7

16.2

15.9

Public Expenditure ( % )

6.5

5.2

3.8

7.6

4.7

Consumption ( % )

11.6

3.1

0.2

8.9

3.0

Investment ( % )

0.7

8.0

2.8

0.6

7.0

 

 

 

 

 

 

Balance of Trade ( MYR Million )

129,563

89,650

118,356

116,058

-

Government Finance ( MYR Million )

<34,462>

<28,450>

<40,482>

<45,511>

<43,021>

Government Finance to GDP / Fiscal Deficit ( % )

<4.8>

<4.8>

<5.6>

<5.4>

<4.7>

Inflation ( % Change in Composite CPI)

<3.3>

<5.2>

5.1

3.1

-

Unemployment Rate

3.7

4.5

3.9

3.3

-

 

 

 

 

 

 

Net International Reserves ( MYR Billion )

388

331

329

415

-

Average Risk-Weighted Capital Adequacy Ratio ( % )

1.91

2.87

2.20

3.50

-

Average 3 Months of Non-performing Loans ( % )

13.24

11.08

15.30

14.80

-

Average Base Lending Rate ( % )

6.72

5.53

6.30

6.60

-

Business Loans Disbursed( % )

11.6

10.5

14.7

15.3

-

Foreign Investment ( MYR Million )

23,261.4

22,156.8

22,517.9

23,546.1

-

Consumer Loans ( % )

-

-

-

-

-

 

 

 

 

 

 

Registration of New Companies ( No. )

41,599

41,578

44,148

-

-

Registration of New Companies ( % )

<4.0>

<0.1>

6.2

-

-

Liquidation of Companies ( No. )

27,992

39,075

25,585

-

-

Liquidation of Companies ( % )

23.7

39.6

<34.5>

-

-

 

 

 

 

 

 

Registration of New Business ( No. )

269,866

312,581

271,414

-

-

Registration of New Business ( % )

-

-

-

-

-

Business Dissolved ( No. )

18,885

19,345

19,738

-

-

Business Dissolved ( % )

<7.6>

2.4

2.0

-

-

 

 

 

 

 

 

Sales of New Passenger Cars (' 000 Unit )

497.5

486.3

543.6

363.0

-

Cellular Phone Subscribers ( Million )

25.1

30.1

32.8

35.3

-

Tourist Arrival ( Million Persons )

21.5

23.6

24.6

25.3

-

Hotel Occupancy Rate ( % )

68.0

58.0

63.0

51.3

-

 

 

 

 

 

 

Credit Cards Spending ( % )

17.1

12.8

14.1

15.6

-

Bad Cheque Offenders (No.)

34,834

36,667

33,568

27,208

-

Individual Bankruptcy ( No.)

13,907

16,228

18,119

16,155

-

Individual Bankruptcy ( % )

5.1

16.7

11.7

<10.8>

-

 

 

 

 

 

 



INDUSTRIES ( % of Growth ):

2008

2009

2010

2011*

2012**

 

 

 

 

 

 

Agriculture

3.6

0.4

2.1

4.7

4.1

Palm Oil

7.0

<1.1>

<3.4>

7.3

-

Rubber

<1.1>

<19.8>

9.9

6.4

-

Forestry & Logging

<1.5>

<5.9>

<3.3>

<4.7>

-

Fishing

4.0

5.5

5.6

2.8

-

Other Agriculture

5.9

9.0

7.9

8.5

-

Industry Non-Performing Loans ( MYR Million )

393.0

413.7

508.4

634.1

-

% of Industry Non-Performing Loans

<2.0>

1.3

2.1

3.2

-

 

 

 

 

 

 

Mining

<0.8>

<3.8>

0.2

<2.4>

2.5

Oil & Gas

12.7

2.1

0.5

<1.7>

-

Other Mining

-

-

-

-

-

Industry Non-performing Loans ( MYR Million )

36.0

44.2

49.7

46.5

-

% of Industry Non-performing Loans

0.1

0.1

0.1

0.1

-

 

 

 

 

 

 

Manufacturing #

1.3

<9.4>

11.4

5.6

4.5

Exported-oriented Industries

2.7

<19.0>

12.1

2.8

-

Electrical & Electronics

2.4

<30.3>

28.4

<4.9>

-

Rubber Products

4.2

<10.1>

25.3

15.4

-

Wood Products

<6.0>

<24.1>

20.1

<7.3>

-

Textiles & Apparel

1.9

<19.5>

<0.4>

14.8

-

Domestic-oriented Industries

9.9

<9.8>

16.3

6.3

-

Food, Beverages & Tobacco

9.5

0.2

3.0

4.2

-

Chemical & Chemical Products

1.4

<7.7>

16.2

5.6

-

Plastic Products

6.5

<9.1>

2.4

3.8

-

Iron & Steel

16.8

<32.7>

29.3

2.4

-

Fabricated Metal Products

14.7

<2.5>

14.9

25.2

-

Non-metallic Mineral

8.3

<15.5>

20.2

16.3

-

Transport Equipment

27.1

<13.5>

36.5

<9.4>

-

Paper & Paper Products

8.6

<5.0>

18.7

15.6

-

Crude Oil Refineries

7.8

0.2

<11.4>

9.3

-

Industry Non-Performing Loans ( MYR Million )

5,729.4

6,007.3

6,217.5

6,537.2

-

% of Industry Non-Performing Loans

16.8

18.3

23.8

25.7

-

 

 

 

 

 

 

Construction

2.1

5.8

5.1

4.4

7.0

Industry Non-Performing Loans ( MYR Million )

4,149.8

3,241.8

4,038.5

3,856.9

-

% of Industry Non-Performing Loans

12.2

9.9

10.7

10.2

-

 

 

 

 

 

 

Services

7.3

2.6

6.5

6.4

6.5

Electric, Gas & Water

5.0

0.4

8.5

5.6

4.8

Transport, Storage & Communication

7.8

1.6

7.7

6.5

7.3

Wholesale, Retail, Hotel & Restaurant

10.0

2.8

4.7

5.2

6.9

Finance, Insurance & Real Estate

9.2

3.8

6.1

6.3

6.5

Government Services

8.6

2.0

6.7

7.6

5.6

Other Services

5.9

4.4

4.2

5.4

5.7

Industry Non-Performing Loans ( MYR Million )

8,281.4

6,631.3

7,384.6

6,825.2

-

% of Industry Non-Performing Loans

24.3

20.2

25.7

23.4

-

 

 

 

 

 

 

 

 

 

 

 

 

* Estimate / Preliminary

 

 

 

 

 

** Forecast

 

 

 

 

 

# Based On Manufacturing Production Index 
(Source : Department of Statistics / Economic Report / Bank Negara Report)

 

 

 

 

 

 



INDUSTRY ANALYSIS

 

MSIC CODE

25193 : Manufacture of rubber gloves

 

 

INDUSTRY :

MANUFACTURING

 

 

 


The manufacturing sector is expected to be driven by higher value-added activities in Malaysia.The GDP growth for first quarter 2012 indicating manufacturing maintain its growth of 4.5%, similar to year 2011.Malaysia recorded a 12% jump in approved investments in the manufacturing sector in the first quarter of 2012 compared with the corresponding period 2011. According to Federation of Malaysian Manufacturers (FMM), manufacturing sector expected to improve in the third quarter 2012 despite concerns over external developments and the rising cost of production.


The rubber products sub-sector is expected to remain resilient supported by continuous improvements in medical and healthcare standards in emerging markets as well as demand from niche markets such as the oil and gas sector for rubber hoses. Malaysia rubber exports are forecast to grow at 10%, at the end of 2012 driven by global demand for medical gloves as well as rubber tyres and tubes.Rubber glove exports make up 70 % of total rubber shipments in Malaysia due to hospitals and clinics place more intrest on rising health and hygiene awareness.


The Malaysia government has growth target of 6.5% for wood based furniture where estimated to reach up to RM53 billion by year 2020.The government providing pioneer status for tax exemption and investment tax allowance for this industry as a boost up step towards produce good quality product and to meet the world demand.


Chemical production are expected to show 6.2% in year 2012 and 7.5 % in year 2013 inline with Malaysia as one of the largest contributor in world Chemicals & Chemical industries.


According to Malaysian Iron and Steel Industry Federation, first half of 2012 would remain weak for the local steel industry due to eurozone crisis, slowdown in China's economy and less robust construction activities in the developed countries. At first quarter 2012, the average local steel price is trading atRM2,300 per tonne compared with the average international price of US$740 (RM2,331) per tonne.


According to the Department of Statistics, Malaysia during the first quarter 2012, the manufacturing output increased due to activities in major sub-sectors such as petroleum, chemical, rubber and plastic products (10.5 %), and non-metallic mineral products, basic metal and fabricated metal products (3.9 %). Meanwhile, it's also announced that the manufacturing sector's sales grew by 10 % in May 2012 to record RM52.5 billion compared with RM47.7 billion in May 2011. The Industrial Production Index (IPI ) increased 7.6 % in May (2012) due to increases in manufacturing (6.5 %). 


Tax and non-tax incentives provided by goverment encourage manufacturers to move up the value chain of manufacturing industry. The new growth initiatives by goverment in the manufacturing sector such as solar and medial services can be important drivers of growth apart from helping to diversify the manufacturing base and contributing to the resilience of the sector.

 

 

OVERALL INDUSTRY OUTLOOK : Average Growth




CREDIT RISK EVALUATION & RECOMMENDATION

 

 


Incorporated in 1990, the SC is a Private Limited company, focusing on manufacturing of surgical, procedure and examination gloves. The SC has been in business for over two decades. It has built up a strong clientele base and good reputation will enable the SC to further enhance its business in the near term. The SC is expected to enjoy a stable market shares. Having strong support from its holding company has enabled the SC to remain competitive despite the challenging business environment. The capital standing of the SC is fair. With an adequate share capital, the SC has the potential of expanding its business in future.


The SC focuses only on overseas market. This global approach has enabled the SC to generate a better growth sales. Being an export-oriented company, the SC however is subjected to certain inherent risk of global economy slowdown, foreign currencies fluctuations and stiff competition in the international market. Being a large entity, the SC has a steady workforce of 500 personnel to support its business operations. Its future prospects seem to be fairly good as its business operations are running relatively stable. The SC has a good management capability. Its capable management team has enabled the SC to keep its business on going. Hence, the future prospect of the SC is bright.


We noted that both the turnover and profits have increased compared to the previous year. The higher profit could be due to increase in turnover and better control over its operating costs. Based on the higher profitability, the SC has generated a favourable return based on its existing shareholders' funds which indicated that the management was efficient in utilising its funds to generate income. Being a lowly geared company, the SC is exposed to low financial risk as it is mainly dependent on its internal funds to finance its business needs. However, due to its weak liquidity position, the SC may face working capital deficiency in meeting its short term financial obligations if no fresh capital are injected into the SC. Given a positive net worth standing at MYR 43,141,659, the SC should be able to maintain its business in the near terms.


Having a strong assets backing, the SC possesses latent assets as collateral for further financial extension. Hence, it has good chance of getting loans if the needs arises. The SC's supplier are from both the local and overseas countries. This will eliminates the risk of dependency on deliveries from a number of key suppliers and insufficient quantities of its raw materials. Overall the SC has a good control over its resources.


The SC's payment habit is average. With its adequate working capital, the SC should be able to pay its short term debts.


The industry shows an upward trend and this trend is very likely to sustain in the near terms. Hence, the SC is expected to benefit from the favourable outlook of the industry.


Based on the above condition, we recommend credit be granted to the SC promptly.

 

 

PROFIT AND LOSS ACCOUNT

 

 

THE FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIAN FINANCIAL REPORTING STANDARDS(FRS)

WEAR SAFE (MALAYSIA) SDN BHD

 

Financial Year End

31/12/2010

31/12/2009

31/12/2008

31/12/2007

Months

12

12

12

12

Consolidated Account

Company

Company

Company

Company

Audited Account

YES

YES

YES

YES

Unqualified Auditor's Report (Clean Opinion)

YES

YES

YES

YES

Financial Type

FULL

FULL

FULL

FULL

Currency

MYR

MYR

MYR

MYR

 

 

 

 

 

TURNOVER

237,012,492

217,322,694

153,326,805

61,830,969

 

----------------

----------------

----------------

----------------

Total Turnover

237,012,492

217,322,694

153,326,805

61,830,969

 

----------------

----------------

----------------

----------------

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

20,488,236

5,469,698

15,255,038

4,958,078

 

----------------

----------------

----------------

----------------

PROFIT/(LOSS) BEFORE TAXATION

20,488,236

5,469,698

15,255,038

4,958,078

Taxation

<4,856,959>

<501,590>

<5,003,388>

3,851,204

 

----------------

----------------

----------------

----------------

PROFIT/(LOSS) AFTER TAXATION

15,631,277

4,968,108

10,251,650

8,809,282

 

----------------

----------------

----------------

----------------

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

As previously reported

24,406,846

20,563,738

10,312,088

2,002,806

Prior year adjustment

<1,896,464>

-

-

-

 

----------------

----------------

----------------

----------------

As restated

22,510,382

20,563,738

10,312,088

2,002,806

 

----------------

----------------

----------------

----------------

PROFIT AVAILABLE FOR APPROPRIATIONS

38,141,659

25,531,846

20,563,738

10,812,088

DIVIDENDS - Ordinary (paid & proposed)

-

<1,125,000>

-

<500,000>

 

----------------

----------------

----------------

----------------

RETAINED PROFIT/(LOSS) CARRIED FORWARD

38,141,659

24,406,846

20,563,738

10,312,088

 

=============

=============

=============

=============

 

 

 

 

 

INTEREST EXPENSE (as per notes to P&L)

 

 

 

 

Bank overdraft

511

3,660

9,788

2,049

Bankers' acceptance

464,002

310,115

-

-

Hire purchase

21,628

183,958

415,226

138,171

Revolving loans

31,710

40,024

48,180

43,165

Term loan / Borrowing

126,026

398,521

462,000

520,053

Others

-

-

614,286

273,650

 

----------------

----------------

----------------

----------------

 

643,877

936,278

1,549,480

977,088

 

 

 

BALANCE SHEET

 

 

WEAR SAFE (MALAYSIA) SDN BHD

 

ASSETS EMPLOYED:

 

 

 

 

FIXED ASSETS

71,154,976

45,567,055

51,767,281

51,921,054

 

 

 

 

 

LONG TERM INVESTMENTS/OTHER ASSETS

 

 

 

 

Deferred assets

-

-

235,436

5,235,874

 

----------------

----------------

----------------

----------------

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

-

-

235,436

5,235,874

 

 

 

 

 

 

----------------

----------------

----------------

----------------

TOTAL LONG TERM ASSETS

71,154,976

45,567,055

52,002,717

57,156,928

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

Stocks

16,825,928

10,821,579

15,545,399

25,984,239

Trade debtors

24,133,183

30,737,746

18,414,858

3,174,315

Other debtors, deposits & prepayments

303,653

180,593

305,444

340,576

Short term deposits

458,000

458,000

458,000

458,000

Amount due from related companies

18,951,429

16,822,754

8,817,036

1,159,045

Cash & bank balances

134,067

1,631,670

900,808

1,191,943

Others

929,316

-

-

-

 

----------------

----------------

----------------

----------------

TOTAL CURRENT ASSETS

61,735,576

60,652,342

44,441,545

32,308,118

 

----------------

----------------

----------------

----------------

TOTAL ASSET

132,890,552

106,219,397

96,444,262

89,465,046

 

=============

=============

=============

=============

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

Trade creditors

9,487,883

5,096,733

7,200,335

9,193,696

Other creditors & accruals

5,156,138

3,558,819

4,004,915

2,577,149

Hire purchase & lease creditors

206,134

1,233,209

4,436,197

4,052,310

Bank overdraft

1,279,694

-

-

-

Short term borrowings/Term loans

1,028,580

1,028,580

1,028,580

1,536,243

Other borrowings

1,000,000

1,000,000

1,000,000

1,000,000

Bill & acceptances payable

16,976,677

10,706,290

16,931,616

11,941,071

Amounts owing to holding company

-

-

12,057,100

12,432,928

Amounts owing to related companies

45,241,202

39,754,957

18,732,973

20,795,711

Provision for taxation

1,194,249

100,335

-

-

Other liabilities

2,543,952

10,977,555

-

-

 

----------------

----------------

----------------

----------------

TOTAL CURRENT LIABILITIES

84,114,509

73,456,478

65,391,716

63,529,108

 

----------------

----------------

----------------

----------------

NET CURRENT ASSETS/(LIABILITIES)

<22,378,933>

<12,804,136>

<20,950,171>

<31,220,990>

 

----------------

----------------

----------------

----------------

TOTAL NET ASSETS

48,776,043

32,762,919

31,052,546

25,935,938

 

=============

=============

=============

=============

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

Ordinary share capital

5,000,000

5,000,000

5,000,000

5,000,000

 

----------------

----------------

----------------

----------------

TOTAL SHARE CAPITAL

5,000,000

5,000,000

5,000,000

5,000,000

 

 

 

 

 

RESERVES

 

 

 

 

Retained profit/(loss) carried forward

38,141,659

24,406,846

20,563,738

10,312,088

 

----------------

----------------

----------------

----------------

TOTAL RESERVES

38,141,659

24,406,846

20,563,738

10,312,088

 

 

 

 

 

 

----------------

----------------

----------------

----------------

SHAREHOLDERS' FUNDS/EQUITY

43,141,659

29,406,846

25,563,738

15,312,088

 

 

 

 

 

LONG TERM LIABILITIES

 

 

 

 

Long term loans

2,012,744

3,191,583

4,241,642

5,270,222

Hire purchase creditors

371,377

-

1,247,166

5,353,628

Deferred taxation

3,250,263

164,490

-

-

 

----------------

----------------

----------------

----------------

TOTAL LONG TERM LIABILITIES

5,634,384

3,356,073

5,488,808

10,623,850

 

----------------

----------------

----------------

----------------

 

48,776,043

32,762,919

31,052,546

25,935,938

 

=============

=============

=============

=============

 

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

WEAR SAFE (MALAYSIA) SDN BHD

 

TYPES OF FUNDS

 

 

 

 

Cash

592,067

2,089,670

1,358,808

1,649,943

Net Liquid Funds

<687,627>

2,089,670

1,358,808

1,649,943

Net Liquid Assets

<39,204,861>

<23,625,715>

<36,495,570>

<57,205,229>

Net Current Assets/(Liabilities)

<22,378,933>

<12,804,136>

<20,950,171>

<31,220,990>

Net Tangible Assets

48,776,043

32,762,919

31,052,546

25,935,938

Net Monetary Assets

<44,839,245>

<26,981,788>

<41,984,378>

<67,829,079>

BALANCE SHEET ITEMS

 

 

 

 

Total Borrowings

5,930,239

6,493,396

12,001,765

17,255,568

Total Liabilities

89,748,893

76,812,551

70,880,524

74,152,958

Total Assets

132,890,552

106,219,397

96,444,262

89,465,046

Net Assets

48,776,043

32,762,919

31,052,546

25,935,938

Net Assets Backing

43,141,659

29,406,846

25,563,738

15,312,088

Shareholders' Funds

43,141,659

29,406,846

25,563,738

15,312,088

Total Share Capital

5,000,000

5,000,000

5,000,000

5,000,000

Total Reserves

38,141,659

24,406,846

20,563,738

10,312,088

LIQUIDITY (Times)

 

 

 

 

Cash Ratio

0.01

0.03

0.02

0.03

Liquid Ratio

0.53

0.68

0.44

0.10

Current Ratio

0.73

0.83

0.68

0.51

WORKING CAPITAL CONTROL (Days)

 

 

 

 

Stock Ratio

26

18

37

153

Debtors Ratio

37

52

44

19

Creditors Ratio

15

9

17

54

SOLVENCY RATIOS (Times)

 

 

 

 

Gearing Ratio

0.14

0.22

0.47

1.13

Liabilities Ratio

2.08

2.61

2.77

4.84

Times Interest Earned Ratio

32.82

6.84

10.85

6.07

Assets Backing Ratio

9.76

6.55

6.21

5.19

PERFORMANCE RATIO (%)

 

 

 

 

Operating Profit Margin

8.64

2.52

9.95

8.02

Net Profit Margin

6.60

2.29

6.69

14.25

Return On Net Assets

43.32

19.55

54.12

22.88

Return On Capital Employed

42.02

18.82

47.29

19.76

Return On Shareholders' Funds/Equity

36.23

16.89

40.10

57.53

Dividend Pay Out Ratio (Times)

0.00

0.23

0.00

0.06

NOTES TO ACCOUNTS

 

 

 

 

Contingent Liabilities

0

0

0

0




 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.54.99

UK Pound

1

Rs.87.21

Euro

1

Rs.70.22

 

 

INFORMATION DETAILS

 

Report Prepared by :

PDT

 

 

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.