|
Report Date : |
04.09.2012 |
IDENTIFICATION DETAILS
|
Name : |
KONG LONG HUAT CHEMICALS SDN BHD |
|
|
|
|
Registered Office : |
23, Jalan 3/3c, Sri Utara, Off Jalan Ipoh, Mukim Batu,
68100 Batu Caves, Selangor |
|
|
|
|
Country : |
Malaysia |
|
|
|
|
Financials (as on) : |
31.12.2010 |
|
|
|
|
Date of Incorporation : |
31.01.1975 |
|
|
|
|
Com. Reg. No.: |
21731-K |
|
|
|
|
Legal Form : |
Private Limited |
|
|
|
|
Line of Business : |
Trading Of Industrial Chemicals |
|
|
|
|
No. of Employees : |
300 |
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 – March 31st, 2012
|
Country Name |
Previous Rating (31.12.2011) |
Current Rating (31.03.2012) |
|
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
REGISTRATION NO. : 21731-K
COMPANY NAME : KONG
LONG HUAT CHEMICALS SDN BHD
FORMER NAME : N/A
INCORPORATION DATE : 31/01/1975
COMPANY STATUS : EXIST
LEGAL STATUS : PRIVATE LIMITED
LISTED STATUS : NO
REGISTERED ADDRESS : 23,
JALAN 3/3C, SRI UTARA, OFF JALAN IPOH, MUKIM BATU, 68100 BATU CAVES, SELANGOR,
MALAYSIA.
BUSINESS ADDRESS : 23,
JALAN 3/3C, SRI UTARA, OFF JALAN IPOH, MUKIM BATU, 68100 BATU CAVES, SELANGOR,
MALAYSIA.
TEL.NO. : 03-62548688 / 78888
FAX.NO. : 03-62523377
EMAIL : marketing@klhchem.com.my
WEB SITE : www.klhchem.com.my
CONTACT PERSON : HENG HONG LEE ( DIRECTOR )
INDUSTRY CODE : 51499
PRINCIPAL ACTIVITY : TRADING OF INDUSTRIAL CHEMICALS
AUTHORISED CAPITAL : MYR
10,000,000.00 DIVIDED INTO
ORDINARY SHARE 10,000,000.00 OF MYR 1.00 EACH.
ISSUED AND PAID UP CAPITAL: MYR 10,000,000.00 DIVIDED INTO
ORDINARY SHARES 1,148,000 CASH AND 8,852,000 OTHERWISE OF MYR 1.00 EACH.
SALES : MYR 285,370,159 [2010]
NET WORTH : MYR 87,074,677 [2010]
M1000 OVERALL RANKING : 835[2009]
M1000 INDUSTRY RANKING : 42[2009]
STAFF STRENGTH : 300 [2012]
BANKER
(S) : RHB
BANK BHD
LITIGATION : CLEAR
DEFAULTER CHECK : CLEAR
FINANCIAL CONDITION : FAIR
PAYMENT : PROMPT
MANAGEMENT CAPABILITY : AVERAGE
COMMERCIAL RISK : LOW
CURRENCY EXPOSURE : MODERATE
GENERAL REPUTATION : GOOD
INDUSTRY OUTLOOK : AVERAGE GROWTH
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) trading of
industrial chemicals.
The SC is not listed on Bursa Malaysia (Malaysia Stock
Exchange).
According
to the Malaysia 1000 publication, the SC's ranking are as follows:
YEAR 2009 2008
OVERALL RANKING 835 857
INDUSTRY RANKING 42 44
The immediate holding company of the SC is KLH CORPORATION
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 (%)
KLH CORPORATION SDN BHD
MENARA HAP SENG, 701167 10,000,000.00 100.00
1 & 3 JALAN P RAMLEE, 10TH
FLOOR, 50250 KUALA LUMPUR,
WILAYAH PERSEKUTUAN,
MALAYSIA.
--------------- ------
10,000,000.00 100.00
============ =====
+ Also Director
DIRECTOR
1
Name Of Subject : DATO' HENG HONG HIM
Address : 6, PERSIARAN TITIWANGSA 1, 53200 KUALA LUMPUR,
WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No : 4950879
New IC No : 560413-10-5923
Date of Birth : 13/04/1956
Nationality : MALAYSIAN CHINESE
Date of Appointment : 10/04/1991
DIRECTOR
2
Name Of Subject : MR. HENG HONG LEE
Address : 39B, JALAN ELITIS DAHINA, VALENCIA SOUTH
PRECINCT, 47000 SUNGAI BULOH, SELANGOR, MALAYSIA.
IC / PP No : 6310996
New IC No : 610626-10-5743
Date of Birth : 26/06/1961
Nationality : MALAYSIAN CHINESE
DIRECTOR
3
Name Of Subject : DATIN HENG LEE HUANG
Address : 14, PERSIARAN TITIWANGSA, OFF JALAN PAHANG,
53200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No : 4737102
New IC No : 541220-10-5560
Date of Birth : 20/12/1954
Nationality : MALAYSIAN CHINESE
Date of Appointment : 10/04/2012
1) Name
of Subject : HENG HONG LEE
Position : DIRECTOR
Auditor : KPMG
Auditor' Address : KPMG TOWER, 8 FIRST AVENUE, BANDAR UTAMA, LEVEL
10, 47800 PETALING JAYA, SELANGOR, MALAYSIA.
1) Company
Secretary : MR. LIM MING TOONG
IC
/ PP No : 6864620
New
IC No : 620916-08-5727
Address : 42, JALAN BK5B/1D, BANDAR KINRARA, 47180 PUCHONG, SELANGOR,
MALAYSIA.
2) Company
Secretary : MS. PANG CHIA TYNG
IC
/ PP No : A3440307
New
IC No : 760917-01-6904
Address : 16, JALAN 11, TAMAN CAHAYA, 68000 AMPANG, SELANGOR, MALAYSIA.
Banking relations are maintained principally with :
1) Name : RHB
BANK BHD
The SC
enjoys normal banking routine with above mentioned banker(s). No adverse record
was found during our investigation.
No encumbrance was found in our databank at the time of investigation.
* 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.
* 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.
SOURCES
OF RAW MATERIALS:
Local : YES
Overseas : YES
Import Countries : GERMANY,NEW ZEALAND,ASIA,EUROPE,UNITED STATES
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 [ X ] Good 31-60 Days [ ] Average
61-90 Days [ ]
Fair
91-120 Days [ ] Poor
>120 Days [ ]
Local : YES
Domestic Markets : MALAYSIA
Overseas : YES
Export
Market : ASIA
Credit Term : 30 - 60 DAYS
Payment Mode : CASH,CHEQUES,TELEGRAPHIC TRANSFER (TT),LETTER
OF CREDIT (LC)
Type of Customer : CHEMICAL INDUSTRY
Goods Traded : INDUSTRIAL CHEMICALS
Member(s) / Affiliate(s) : MALAYSIAN
INTERNATIONAL CHAMBER OF COMMERCE AND INDUSTRY (MICCI)
CHEMICAL INDUSTRIES COUNCIL OF MALAYSIA (CICM)
Ownership of premises : OWNED
Production Capacity : DEPEND
ON ITS CUSTOMERS' ORDERS AND REQUIREMENTS
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 300 250 230 240 200 150
Branch : YES
Other Information:
The SC is principally engaged in the (as a / as an) trading of industrial
chemicals.
The SC offers a wide range of organic and in-organic chemicals for industries
such as Oil and Gas, Electronics, Metal, Food and Beverage, Textile,
Oleochemicals, Rubber, Water and Waste treatment, Ceramic, Feedmills and
others.
Besides that, the SC repacks the products based on the customers' requirements.
The SC's chemicals comes in both powder and liquid forms and it sells in
bottles, drums as well as jars.
The SC has trucks, road tankers, bulk storage facilities to transport and keep
its products safely for timely delivery to its clients.
We were informed that the SC has branches located in Penang, Perak, Johor,
Sarawak and Pahang.
No projects found in our databank
Latest fresh investigations carried out on the SC indicated
that :
Telephone Number Provided By Client : +603 6257 8888
Current Telephone Number : 03-62548688 / 78888
Match : YES
Address Provided by Client : NO 23 JALAN 3/3C, SRI UTARA OFF JALAN IPOH,
MUKIM BATU, 68100 KUALA MALAYSIA
Current Address : 23, JALAN 3/3C, SRI UTARA, OFF JALAN IPOH,
MUKIM BATU, 68100 BATU CAVES, SELANGOR, MALAYSIA.
Match : YES
Latest Financial Accounts : YES
Other
Investigations
On 29th August 2012 we contacted one of the staff from the SC and she provided
some information on the SC.
Profitability
Turnover : Increased [ 3.38% ]
Profit/(Loss)
Before Tax : Decreased [ 12.31% ]
Return
on Shareholder Funds : Acceptable [ 12.51% ]
Return
on Net Assets : Acceptable [ 18.11% ]
The higher
turnover could be attributed to the favourable market condition.The dip in
profit could be due to the stiff market competition which reduced the SC's
profit margin. The SC's management had generated acceptable return for its
shareholders using its assets.
Working
Capital Control
Stock
Ratio : Favourable [ 42 Days ]
Debtor
Ratio : Acceptable [ 62 Days ]
Creditors
Ratio : Favourable [ 27 Days ]
The
SC's stocks were moving fast thus reducing its holding cost. This had reduced
funds being tied up in stocks. The SC's management was quite efficient in
handling its debtors. The SC's debtors days were at an acceptable range, thus
the risk of its debts turning bad was minimised. 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 : Acceptable [ 0.98 Times ]
Current
Ratio : Unfavourable [ 1.42 Times ]
The
SC's liquid ratio was slightly low. This could indicate that the SC's working
capital was slightly deficient. The SC will have to improve its liquidity
position either by obtaining short term financing or increase its paid up
capital so that it can meet all its short term obligations as and when they
fall due.
Solvency
Interest
Cover : Favourable [ 22.07 Times ]
Gearing
Ratio : Favourable [ 0.01 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 had no gearing and hence it had
virtually no financial risk. The SC was financed by its shareholders' funds and
internally generated fund. During the economic downturn, the SC, having a zero
gearing, will be able to compete better than those which are highly geared in
the same industry.
Overall
Assessment :
Although
the SC's turnover had increased, its profits had declined over the same
corresponding period. This could be due to the stiffer market competition and /
or higher operating costs which lowered the SC's profit margin. The SC's
liquidity was at an acceptable range. If the SC is able to obtain further short
term financing, it should be able to meet all its short term obligations. 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
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)
MSIC
CODE
51499
: Wholesale of other intermediate products, waste and scrap n.e.c.
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
Incorporated in 1975, the SC is a Private Limited company, focusing on trading of
industrial chemicals. With experiences for about 37 years in the industry, the
SC's operation has been running relatively stable since it has built up a
relatively sound and stable clientele base which has contributed to its good
business growth. Having strong support from its holding company has enabled the
SC to remain competitive despite the challenging business environment.
Moreover, with a large issued and paid up capital of MYR 10,000,000, the SC's
business has been expanding comfortably over the years. We are confident with
the SC's business and its future growth prospect.
Over the years, the SC has penetrated into both the local and overseas market.
Besides catering to the local market, the SC has ventured into global market.
We believe that this global approach has minimised its commercial risk and
better growth prospects can be expected. The SC is a fairly large and rapidly
growing company with over 300 staff in its operations. Overall, we regard that
the SC's management capability is average. This indicates that the SC has
greater potential to improve its business performance and raising income for
the SC.
Financially, the SC registered a higher turnover compared to previous year.
However, its profits showed a reverse trend. The lower profit achieved was a
result of higher operating cost and increased competition. Return on
shareholders' funds of the SC was at an acceptable range which indicated that
the management was efficient in utilising its funds to generate income. The SC
managed to maintain an adequate liquidity level, indicating that the SC has the
ability to meet its financial obligations. 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. Given a positive net worth standing at MYR
87,074,677, 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. Investigation revealed that the SC's raw materials are
sourced from both local and overseas suppliers. Hence, the SC is subjected to
currency fluctuation risk and high operating costs. Overall the SC has a good
control over its resources.
We regard that the SC's overall payment habit is prompt. The SC had a
favourable creditors' ratio as evidenced by its favourable collection days.
The industry shows an upward trend and this trend is likely to sustain in the
near future. With the promising outlook of the industry performance, the SC
business potential should be favourable.
Based on the above condition, we recommend credit be granted to the SC
promptly.
THE
FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIAN FINANCIAL
REPORTING STANDARDS(FRS)
KONG
LONG HUAT CHEMICALS SDN BHD
Financial Year End 31/12/2010 31/12/2009
Months 12 12
Consolidated Account Company Company
Audited Account YES YES
Unqualified Auditor's Report (Clean Opinion) YES YES
Financial Type FULL FULL
Currency MYR MYR
TURNOVER 285,370,159 276,034,933
---------------- ----------------
Total Turnover 285,370,159 276,034,933
Costs of Goods Sold <242,410,634> <235,086,999>
---------------- ----------------
Gross Profit 42,959,525 40,947,934
---------------- ----------------
PROFIT/(LOSS) FROM OPERATIONS 15,101,707 17,221,130
---------------- ----------------
PROFIT/(LOSS) BEFORE TAXATION 15,101,707 17,221,130
Taxation <4,211,746> <4,470,028>
---------------- ----------------
PROFIT/(LOSS) AFTER TAXATION 10,889,961 12,751,102
---------------- ----------------
RETAINED PROFIT/(LOSS) BROUGHT FORWARD
As previously reported 63,371,036 54,622,434
---------------- ----------------
As restated 63,371,036 54,622,434
---------------- ----------------
PROFIT AVAILABLE FOR APPROPRIATIONS 74,260,997 67,373,536
DIVIDENDS - Ordinary (paid & proposed) <1,650,000> <4,002,500>
---------------- ----------------
RETAINED PROFIT/(LOSS) CARRIED FORWARD 72,610,997 63,371,036
============= =============
INTEREST EXPENSE (as per notes to
P&L)
Bank overdraft 5,583 5,318
Lease interest - 79,966
Term loan / Borrowing - 57
Others 711,003 590,116
---------------- ----------------
716,586 675,457
KONG
LONG HUAT CHEMICALS SDN BHD
ASSETS EMPLOYED:
FIXED ASSETS 46,961,327 52,062,602
LONG TERM INVESTMENTS/OTHER ASSETS
Investment properties 7,416,407 1,901,750
Investments 440,750 276,188
Deferred assets 1,204,474 1,270,000
---------------- ----------------
TOTAL LONG TERM INVESTMENTS/OTHER ASSETS 9,061,631 3,447,938
---------------- ----------------
TOTAL LONG TERM ASSETS 56,022,958 55,510,540
CURRENT ASSETS
Stocks 32,891,187 28,073,564
Trade debtors 48,626,630 40,314,122
Other debtors, deposits & prepayments 1,161,730 1,269,166
Short term deposits 14,200,000 9,000,000
Cash & bank balances 8,610,520 9,737,999
---------------- ----------------
TOTAL CURRENT ASSETS 105,490,067 88,394,851
---------------- ----------------
TOTAL ASSET 161,513,025 143,905,391
============= =============
CURRENT LIABILITIES
Trade creditors 18,010,868 20,330,998
Other creditors & accruals 7,953,320 8,948,020
Hire purchase & lease creditors 203,659 467,487
Bill & acceptances payable 31,951,000 20,488,000
Amounts owing to holding company 12,779,972 13,093,249
Amounts owing to director 106,320 106,320
Provision for taxation 1,528,851 461,250
Dividends payable/proposed 1,650,000 1,402,500
---------------- ----------------
TOTAL CURRENT LIABILITIES 74,183,990 65,297,824
---------------- ----------------
NET CURRENT ASSETS/(LIABILITIES) 31,306,077 23,097,027
---------------- ----------------
TOTAL NET ASSETS 87,329,035 78,607,567
============= =============
SHARE CAPITAL
Ordinary share capital 10,000,000 10,000,000
---------------- ----------------
TOTAL SHARE CAPITAL 10,000,000 10,000,000
RESERVES
Share premium 4,463,680 4,463,680
Retained profit/(loss) carried forward 72,610,997 63,371,036
---------------- ----------------
TOTAL RESERVES 77,074,677 67,834,716
---------------- ----------------
SHAREHOLDERS' FUNDS/EQUITY 87,074,677 77,834,716
LONG TERM LIABILITIES
Lease obligations 254,358 772,851
---------------- ----------------
TOTAL LONG TERM LIABILITIES 254,358 772,851
---------------- ----------------
87,329,035 78,607,567
============= =============
KONG
LONG HUAT CHEMICALS SDN BHD
TYPES OF FUNDS
Cash 22,810,520 18,737,999
Net Liquid Funds 22,810,520 18,737,999
Net Liquid Assets <1,585,110> <4,976,537>
Net Current Assets/(Liabilities) 31,306,077 23,097,027
Net Tangible Assets 87,329,035 78,607,567
Net Monetary Assets <1,839,468> <5,749,388>
BALANCE SHEET ITEMS
Total Borrowings 458,017 1,240,338
Total Liabilities 74,438,348 66,070,675
Total Assets 161,513,025 143,905,391
Net Assets 87,329,035 78,607,567
Net Assets Backing 87,074,677 77,834,716
Shareholders' Funds 87,074,677 77,834,716
Total Share Capital 10,000,000 10,000,000
Total Reserves 77,074,677 67,834,716
LIQUIDITY (Times)
Cash Ratio 0.31 0.29
Liquid Ratio 0.98 0.92
Current Ratio 1.42 1.35
WORKING CAPITAL CONTROL (Days)
Stock Ratio 42 37
Debtors Ratio 62 53
Creditors Ratio 27 32
SOLVENCY RATIOS (Times)
Gearing Ratio 0.01 0.02
Liabilities Ratio 0.85 0.85
Times Interest Earned Ratio 22.07 26.50
Assets Backing Ratio 8.73 7.86
PERFORMANCE RATIO (%)
Operating Profit Margin 5.29 6.24
Net Profit Margin 3.82 4.62
Return On Net Assets 18.11 22.77
Return On Capital Employed 18.07 22.63
Return On Shareholders' Funds/Equity 12.51 16.38
Dividend Pay Out Ratio (Times) 0.15 0.31
NOTES TO ACCOUNTS
Contingent Liabilities 0 0
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.55.45 |
|
|
1 |
Rs.87.98 |
|
Euro |
1 |
Rs.69.69 |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.