|
* Adopted abbreviations :
|
SC - Subject Company (the company enquired by you)
|
|
|
|
N/A - Not Applicable
|
|
|
|
EXECUTIVE SUMMARY
|
REGISTRATION NO.
|
:
|
744068-T
|
|
COMPANY NAME
|
:
|
HOONG QIAN TRADING SDN. BHD.
|
|
FORMER NAME
|
:
|
N/A
|
|
INCORPORATION DATE
|
:
|
13/08/2006
|
|
|
|
|
|
|
|
|
|
COMPANY STATUS
|
:
|
EXIST
|
|
LEGAL FORM
|
:
|
PRIVATE LIMITED (LIMITED BY SHARE)
|
|
LISTED STATUS
|
:
|
NO
|
|
|
|
|
|
|
|
|
|
REGISTERED ADDRESS
|
:
|
130, PEKELILING DATARAN KLEDANG, INDUSTRI CHANDAN RAYA, 31450 MENGLEMBU,
PERAK, MALAYSIA.
|
|
BUSINESS ADDRESS
|
:
|
130, PEKELILING DATARAN KLEDANG, INDUSTRI CHANDAN RAYA, 31450
MENGLEMBU, PERAK, MALAYSIA.
|
|
TEL.NO.
|
:
|
05-2828060
|
|
FAX.NO.
|
:
|
05-2828060
|
|
CONTACT PERSON
|
:
|
LEW KWOK KEONG ( MANAGING DIRECTOR )
|
|
|
|
|
|
INDUSTRY CODE
|
:
|
47712
|
|
PRINCIPAL ACTIVITY
|
:
|
TRADING OF FOOTWEAR
|
|
AUTHORISED
CAPITAL
|
:
|
MYR 500,000.00
DIVIDED INTO
ORDINARY SHARE 500,000.00 OF MYR 1.00 EACH.
|
|
ISSUED AND PAID
UP CAPITAL
|
:
|
MYR 200,000.00
DIVIDED INTO
ORDINARY SHARES 200,000 CASH OF MYR 1.00 EACH.
|
|
|
|
|
|
SALES
|
:
|
MYR 2,395,698 [2011]
|
|
NET WORTH
|
:
|
MYR 272,220 [2011]
|
|
|
|
|
|
STAFF STRENGTH
|
:
|
9 [2013]
|
|
BANKER (S)
|
:
|
|
PUBLIC
BANK BHD
OCBC BANK (MALAYSIA) BHD
|
|
|
|
LITIGATION
|
:
|
CLEAR
|
|
DEFAULTER CHECK
|
:
|
CLEAR
|
|
FINANCIAL CONDITION
|
:
|
LIMITED
|
|
PAYMENT
|
:
|
FAIR
|
|
MANAGEMENT CAPABILITY
|
:
|
AVERAGE
|
|
|
|
|
|
COMMERCIAL RISK
|
:
|
HIGH
|
|
CURRENCY EXPOSURE
|
:
|
MODERATE
|
|
GENERAL REPUTATION
|
:
|
SATISFACTORY
|
|
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) trading of footwear.
The SC is not
listed on Bursa Malaysia (Malaysia Stock Exchange).
The major shareholder(s) of the SC are shown as follows :
|
Name
|
Address
|
IC/PP/Loc No
|
Shareholding
|
(%)
|
|
MS. CHEN SOW WAN +
|
20, LALUAN MENGLEMBU TIMUR 2, TAMAN MENGLEMBU TIMUR, 31450
MENGLEMBU, PERAK, MALAYSIA.
|
740412-08-6626
|
110,000.00
|
55.00
|
|
MR. LEW KWOK KEONG +
|
20, LALUAN MENGLEMBU TIMUR 2, TAMAN MENGLEMBU TIMUR, 31450
MENGLEMBU, PERAK, MALAYSIA.
|
690304-08-6087
|
90,000.00
|
45.00
|
|
|
|
|
---------------
|
------
|
|
|
|
|
200,000.00
|
100.00
|
|
|
|
|
============
|
=====
|
+ Also Director
DIRECTORS
DIRECTOR 1
|
Name Of Subject
|
:
|
MR. LEW KWOK KEONG
|
|
Address
|
:
|
20, LALUAN MENGLEMBU TIMUR 2, TAMAN MENGLEMBU TIMUR, 31450
MENGLEMBU, PERAK, MALAYSIA.
|
|
|
|
|
|
New IC No
|
:
|
690304-08-6087
|
|
Date of Birth
|
:
|
04/03/1969
|
|
|
|
|
|
Nationality
|
:
|
MALAYSIAN
|
|
Date of Appointment
|
:
|
13/08/2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DIRECTOR 2
|
Name Of Subject
|
:
|
MS. CHEN SOW WAN
|
|
Address
|
:
|
20, LALUAN MENGLEMBU TIMUR 2, TAMAN MENGLEMBU TIMUR, 31450
MENGLEMBU, PERAK, MALAYSIA.
|
|
|
|
|
|
New IC No
|
:
|
740412-08-6626
|
|
Date of Birth
|
:
|
12/04/1974
|
|
|
|
|
|
Nationality
|
:
|
MALAYSIAN
|
|
Date of Appointment
|
:
|
13/08/2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1)
|
Name of Subject
|
:
|
LEW KWOK KEONG
|
|
|
Position
|
:
|
MANAGING DIRECTOR
|
|
|
|
|
|
|
Auditor
|
:
|
T.H.YEW & CO
|
|
Auditor' Address
|
:
|
21, JALAN CHEW BOON JUAN, OFF JALAN KAMPAR, 30250 IPOH, PERAK,
MALAYSIA.
|
|
|
|
|
|
|
|
|
COMPANY SECRETARIES
|
1)
|
Company Secretary
|
:
|
MS. NG SU-YI
|
|
|
|
|
|
|
|
New IC No
|
:
|
650315-08-5008
|
|
|
Address
|
:
|
37, SRI KLEBANG A/11, BANDAR BARU SRI KLEBANG, 31200 CHEMOR, PERAK,
MALAYSIA.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BANKING
Banking relations are maintained principally with :
|
1)
|
Name
|
:
|
PUBLIC BANK BHD
|
|
|
|
|
|
|
|
|
|
|
|
2)
|
Name
|
:
|
OCBC BANK (MALAYSIA) BHD
|
|
|
|
|
|
|
|
|
|
|
ENCUMBRANCE (S)
|
Charge No
|
Creation Date
|
Charge
Description
|
Chargee Name
|
Total Charge
|
Status
|
|
1
|
04/07/2007
|
N/A
|
PUBLIC BANK BERHAD
|
MYR 370,000.00
|
Unsatisfied
|
|
2
|
26/07/2010
|
N/A
|
PUBLIC BANK BERHAD
|
MYR 150,000.00
|
Satisfied
|
|
3
|
19/09/2012
|
N/A
|
OCBC BANK (MALAYSIA) BERHAD
|
N/A
|
Unsatisfied
|
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
|
:
|
40%
|
|
Overseas
|
:
|
YES
|
Percentage
|
:
|
60%
|
|
|
|
|
|
|
|
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
|
[
|
|
]
|
|
|
Fair 91-120 Days
|
[
|
X
|
]
|
|
Poor >120 Days
|
[
|
|
]
|
|
|
|
|
|
|
CLIENTELE
|
Local
|
:
|
YES
|
Percentage
|
:
|
100%
|
|
Domestic Markets
|
:
|
MALAYSIA
|
|
Overseas
|
:
|
NO
|
|
|
|
|
|
|
|
|
|
|
|
Credit Term
|
:
|
15 - 30 DAYS
|
|
|
|
|
|
|
|
|
Payment Mode
|
:
|
CHEQUES
CASH
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATIONS
|
Total Number of Employees:
|
|
YEAR
|
2013
|
2011
|
|
|
|
|
GROUP
|
N/A
|
N/A
|
|
|
|
|
|
|
|
|
COMPANY
|
9
|
5
|
|
|
|
|
|
|
|
Other Information:
The SC is principally engaged in the (as a / as an) trading of footwear.
The Sc is dealing with trading in footwear.
The SC's main product is ladies footwear.
PROJECTS
No projects found in our databank
CURRENT INVESTIGATION
Latest fresh
investigations carried out on the SC indicated that :
|
Telephone Number Provided By Client
|
:
|
5 282 8060
|
|
Current Telephone Number
|
:
|
05-2828060
|
|
Match
|
:
|
YES
|
|
|
|
|
|
Address Provided by Client
|
:
|
NO.130 PEKELILING DATARAN KLEDA-NG, INDUSTRI CHANDAN RAYA, 31450 MENGLEMBU,PERAK,WEST
MALAYSIA
|
|
Current Address
|
:
|
130, PEKELILING DATARAN KLEDANG, INDUSTRI CHANDAN RAYA, 31450
MENGLEMBU, PERAK, MALAYSIA.
|
|
Match
|
:
|
NO
|
|
|
|
|
|
Latest Financial Accounts
|
:
|
YES
|
Other Investigations
We contacted one of the staff from the SC and she provided some information
on the SC.
The address provided is incorrect.
FINANCIAL ANALYSIS
|
Profitability
|
|
|
|
|
|
|
|
Turnover
|
:
|
Increased
|
[
|
2008 - 2011
|
]
|
|
|
Profit/(Loss) Before Tax
|
:
|
Increased
|
[
|
2008 - 2011
|
]
|
|
|
Return on Shareholder Funds
|
:
|
Acceptable
|
[
|
10.95%
|
]
|
|
|
Return on Net Assets
|
:
|
Acceptable
|
[
|
15.35%
|
]
|
|
|
|
|
|
|
|
|
|
|
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. The SC's management
had generated acceptable return for its shareholders using its assets.
|
|
|
|
|
|
|
|
|
|
Working Capital Control
|
|
|
|
|
|
|
|
Stock Ratio
|
:
|
Favourable
|
[
|
22 Days
|
]
|
|
|
Debtor Ratio
|
:
|
Unfavourable
|
[
|
69 Days
|
]
|
|
|
Creditors Ratio
|
:
|
Unfavourable
|
[
|
91 Days
|
]
|
|
|
|
|
|
|
|
|
|
|
The SC's stocks were moving fast thus reducing its holding cost.
This had reduced funds being tied up in stocks. The high debtors' ratio
could indicate that the SC was weak in its credit control. However, the SC
could also giving longer credit periods to its customers in order to boost
its sales or to capture / retain its market share. The unfavourable
creditors' ratio could be due to the SC taking advantage of the credit
granted by its suppliers. However this may affect the goodwill between the
SC and its suppliers and the SC may inadvertently have to pay more for its
future supplies.
|
|
|
|
|
|
|
|
|
|
Liquidity
|
|
|
|
|
|
|
|
Liquid Ratio
|
:
|
Favourable
|
[
|
1.04 Times
|
]
|
|
|
Current Ratio
|
:
|
Unfavourable
|
[
|
1.15 Times
|
]
|
|
|
|
|
|
|
|
|
|
|
A minimum liquid ratio of 1 should be maintained by the SC in order
to assure its creditors of its ability to meet short term obligations and the
SC was in a good liquidity position. Thus, we believe the SC is able to
meet all its short term obligations as and when they fall due.
|
|
|
|
|
|
|
|
|
|
Solvency
|
|
|
|
|
|
|
|
Interest Cover
|
:
|
Unfavourable
|
[
|
1.64 Times
|
]
|
|
|
Gearing Ratio
|
:
|
Unfavourable
|
[
|
5.31 Times
|
]
|
|
|
|
|
|
|
|
|
|
|
The SC's interest cover was low. If its profits fall or when
interest rate rises, it may not be able to meet all its interest payment. The
SC was highly geared, thus it had a high financial risk. The SC was
dependent on loans to finance its business needs. In times of economic
downturn and / or high interest rate, the SC will become less profitable
and competitive than other firms in the same industry, which are lowly
geared. This is because the SC has to service the interest and to repay the
loan, which will erode part of its profits. The profits will fluctuate
depending on the SC's turnover and the interest it needs to pay.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overall Assessment :
|
|
|
|
|
|
|
|
Generally, the SC's performance has improved with higher turnover
and profit. The SC was in good liquidity position with its total current liabilities
well covered by its total current assets. With its current net assets, the
SC should be able to repay its short term obligations. If there is a fall
in the SC's profit or any increase in interest rate, the SC may not be able
to generate sufficient cash-flow to service its interest. The SC's gearing
level was high and its going concern will be in doubt if there is no
injection of additional shareholders' funds in times of economic downturn
and / or high interest rates.
|
|
|
|
|
|
|
|
|
|
Overall financial condition of the SC : LIMITED
|
MALAYSIA ECONOMIC / INDUSTRY OUTLOOK
|
Major Economic Indicators:
|
2009
|
2010
|
2011
|
2012*
|
2013**
|
|
|
|
|
|
|
|
|
Population ( Million)
|
28.13
|
28.35
|
28.70
|
29.30
|
29.80
|
|
Gross Domestic Products ( % )
|
<0.5>
|
7.2
|
5.1
|
5.6
|
5.3
|
|
Domestic Demand ( % )
|
2.9
|
6.3
|
8.2
|
9.4
|
5.6
|
|
Private Expenditure ( % )
|
<2.7>
|
8.1
|
8.2
|
8.0
|
7.4
|
|
Consumption ( % )
|
0.7
|
6.7
|
7.1
|
1.0
|
5.7
|
|
Investment ( % )
|
<17.2>
|
17.7
|
12.2
|
11.7
|
13.3
|
|
Public Expenditure ( % )
|
5.2
|
3.8
|
8.4
|
13.3
|
1.2
|
|
Consumption ( % )
|
3.1
|
0.2
|
16.1
|
11.3
|
<1.2>
|
|
Investment ( % )
|
8.0
|
2.8
|
<0.3>
|
15.9
|
4.2
|
|
|
|
|
|
|
|
|
Balance of Trade ( MYR Million )
|
89,650
|
118,356
|
116,058
|
106,300
|
110,700
|
|
Government Finance ( MYR Million )
|
<28,450>
|
<40,482>
|
<45,511>
|
<42,297>
|
<39,993>
|
|
Government Finance to GDP / Fiscal Deficit ( % )
|
<4.8>
|
<5.6>
|
<5.4>
|
<4.5>
|
<4.0>
|
|
Inflation ( % Change in Composite CPI)
|
<5.2>
|
5.1
|
3.1
|
1.6
|
2.5
|
|
Unemployment Rate
|
4.5
|
3.9
|
3.3
|
3.2
|
3.0
|
|
|
|
|
|
|
|
|
Net International Reserves ( MYR Billion )
|
331
|
329
|
415
|
427
|
-
|
|
Average Risk-Weighted Capital Adequacy Ratio ( % )
|
2.87
|
2.20
|
3.50
|
2.20
|
-
|
|
Average 3 Months of Non-performing Loans ( % )
|
11.08
|
15.30
|
14.80
|
14.70
|
-
|
|
Average Base Lending Rate ( % )
|
5.53
|
6.30
|
6.60
|
6.53
|
-
|
|
Business Loans Disbursed( % )
|
10.5
|
14.7
|
15.3
|
32.2
|
-
|
|
Foreign Investment ( MYR Million )
|
22,156.8
|
22,517.9
|
23,546.1
|
26,230.4
|
-
|
|
Consumer Loans ( % )
|
-
|
-
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
Registration of New Companies ( No. )
|
41,578
|
44,148
|
45,455
|
45,441
|
-
|
|
Registration of New Companies ( % )
|
<0.1>
|
6.2
|
3.0
|
<0.0>
|
-
|
|
Liquidation of Companies ( No. )
|
39,075
|
25,585
|
132,476
|
-
|
-
|
|
Liquidation of Companies ( % )
|
39.6
|
<34.5>
|
417.8
|
-
|
-
|
|
|
|
|
|
|
|
|
Registration of New Business ( No. )
|
312,581
|
271,414
|
284,598
|
324,761
|
-
|
|
Registration of New Business ( % )
|
-
|
-
|
-
|
-
|
-
|
|
Business Dissolved ( No. )
|
19,345
|
19,738
|
20,121
|
-
|
-
|
|
Business Dissolved ( % )
|
2.4
|
2.0
|
1.9
|
-
|
-
|
|
|
|
|
|
|
|
|
Sales of New Passenger Cars (' 000 Unit )
|
486.3
|
543.6
|
535.1
|
552.2
|
-
|
|
Cellular Phone Subscribers ( Million )
|
30.1
|
32.8
|
35.3
|
38.5
|
-
|
|
Tourist Arrival ( Million Persons )
|
23.6
|
24.6
|
24.7
|
25.0
|
-
|
|
Hotel Occupancy Rate ( % )
|
58.0
|
63.0
|
60.6
|
62.4
|
-
|
|
|
|
|
|
|
|
|
Credit Cards Spending ( % )
|
12.8
|
14.1
|
15.6
|
12.6
|
-
|
|
Bad Cheque Offenders (No.)
|
36,667
|
33,568
|
32,627
|
26,982
|
-
|
|
Individual Bankruptcy ( No.)
|
16,228
|
18,119
|
19,167
|
19,575
|
-
|
|
Individual Bankruptcy ( % )
|
16.7
|
11.7
|
5.8
|
2.1
|
-
|
|
|
|
|
|
|
|
|
INDUSTRIES ( % of Growth ):
|
2009
|
2010
|
2011
|
2012*
|
2013**
|
|
|
|
|
|
|
|
|
Agriculture
|
0.4
|
2.1
|
5.9
|
0.6
|
2.4
|
|
Palm Oil
|
<1.1>
|
<3.4>
|
10.8
|
<2.8>
|
-
|
|
Rubber
|
<19.8>
|
9.9
|
6.1
|
<0.6>
|
-
|
|
Forestry & Logging
|
<5.9>
|
<3.3>
|
<7.6>
|
<2.2>
|
-
|
|
Fishing
|
5.5
|
5.6
|
2.1
|
<0.7>
|
-
|
|
Other Agriculture
|
9.0
|
7.9
|
7.1
|
6.4
|
-
|
|
Industry Non-Performing Loans ( MYR Million )
|
413.7
|
508.4
|
634.1
|
-
|
-
|
|
% of Industry Non-Performing Loans
|
1.3
|
2.1
|
3.2
|
-
|
-
|
|
|
|
|
|
|
|
|
Mining
|
<3.8>
|
0.2
|
<5.7>
|
1.5
|
2.7
|
|
Oil & Gas
|
2.1
|
0.5
|
<1.7>
|
-
|
-
|
|
Other Mining
|
-
|
-
|
-
|
-
|
-
|
|
Industry Non-performing Loans ( MYR Million )
|
44.2
|
49.7
|
46.5
|
-
|
-
|
|
% of Industry Non-performing Loans
|
0.1
|
0.1
|
0.1
|
-
|
-
|
|
|
|
|
|
|
|
|
Manufacturing #
|
<9.4>
|
11.4
|
4.7
|
4.2
|
4.9
|
|
Exported-oriented Industries
|
<19.0>
|
12.1
|
2.8
|
4.1
|
-
|
|
Electrical & Electronics
|
<30.3>
|
28.4
|
<4.9>
|
1.6
|
-
|
|
Rubber Products
|
<10.1>
|
25.3
|
15.4
|
3.6
|
-
|
|
Wood Products
|
<24.1>
|
20.1
|
<4.9>
|
4.6
|
-
|
|
Textiles & Apparel
|
<19.5>
|
<0.4>
|
14.8
|
<7.1>
|
-
|
|
Domestic-oriented Industries
|
<9.8>
|
16.3
|
6.5
|
8.6
|
-
|
|
Food, Beverages & Tobacco
|
0.2
|
3.0
|
4.2
|
-
|
-
|
|
Chemical & Chemical Products
|
<7.7>
|
16.2
|
5.5
|
9.9
|
-
|
|
Plastic Products
|
<9.1>
|
2.4
|
3.8
|
-
|
-
|
|
Iron & Steel
|
<32.7>
|
29.3
|
2.4
|
-
|
-
|
|
Fabricated Metal Products
|
<2.5>
|
14.9
|
25.2
|
-
|
-
|
|
Non-metallic Mineral
|
<15.5>
|
20.2
|
27.1
|
6.6
|
-
|
|
Transport Equipment
|
<13.5>
|
36.5
|
<10.4>
|
13.7
|
-
|
|
Paper & Paper Products
|
<5.0>
|
18.7
|
14.8
|
<7.8>
|
-
|
|
Crude Oil Refineries
|
0.2
|
<11.4>
|
9.3
|
-
|
-
|
|
Industry Non-Performing Loans ( MYR Million )
|
6,007.3
|
6,217.5
|
6,537.2
|
-
|
-
|
|
% of Industry Non-Performing Loans
|
18.3
|
23.8
|
25.7
|
-
|
-
|
|
|
|
|
|
|
|
|
Construction
|
5.8
|
5.1
|
4.4
|
15.5
|
11.2
|
|
Industry Non-Performing Loans ( MYR Million )
|
3,241.8
|
4,038.5
|
3,856.9
|
-
|
-
|
|
% of Industry Non-Performing Loans
|
9.9
|
10.7
|
10.2
|
-
|
-
|
|
|
|
|
|
|
|
|
Services
|
2.6
|
6.5
|
6.4
|
5.5
|
5.6
|
|
Electric, Gas & Water
|
0.4
|
8.5
|
5.6
|
4.8
|
-
|
|
Transport, Storage & Communication
|
1.6
|
7.7
|
6.5
|
7.3
|
-
|
|
Wholesale, Retail, Hotel & Restaurant
|
2.8
|
4.7
|
5.2
|
6.9
|
-
|
|
Finance, Insurance & Real Estate
|
3.8
|
6.1
|
6.3
|
6.5
|
-
|
|
Government Services
|
2.0
|
6.7
|
7.6
|
5.6
|
-
|
|
Other Services
|
4.4
|
4.2
|
5.4
|
5.7
|
-
|
|
Industry Non-Performing Loans ( MYR Million )
|
6,631.3
|
7,384.6
|
6,825.2
|
-
|
-
|
|
% of Industry Non-Performing Loans
|
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
|
|
47712 : Retail sale of footwear
|
|
|
|
|
INDUSTRY :
|
TRADING
|
|
|
|
|
|
|
According to the Retail Group Malaysia (RGM), the wholesale and
retail trade sector forecast to grow to 6% in year 2013. During the first quarter
of year 2013, RGM is estimating the retail industry to grow 6.9%. Many
retailers have been enjoying better sales since the government handed out
cash from mid-January of 2013 under the second round of Bantuan Rakyat
1Malaysia to more than 12 million Malaysians. Bookstores and related retail
stores have also started enjoying rising sales since the RM250 1Malaysia
Book Voucher was distributed to 1.3 million private and public university
students. Besides, since early February 2013, handphone traders and
retailers selling smartphone accessories have started to benefit from the
RM200 rebate on smartphones for 1.5 million young adults aged between 21
and 30 years with a monthly income of not more than RM3,000.
|
|
|
|
The wholesale and retail trade sector grew 6.1% in the first half of
the year 2012 driven by strong domestic consumption and the increasing
number of large format stores operating in Malaysia, including 180 foreign
hypermarkets, superstores and departmental stores as at end of August 2012.
In addition, other indicators such as imports of consumption goods were
higher by 15.2%.
|
|
|
|
In 2012, the wholesale and retail trade sector growth to 5.5% driven
by higher consumption which benefited from Government initiatives under the
2012 Budget such as BR1M, Baucar Buku 1Malaysia (BB1M) and the RM100
assistance for all primary and secondary school students. The performance
of the sector will also be supported by ongoing efforts to modernise the
retail segment under the ETP. In 2012, 500 retail shops and 50 workshops
are targeted to be modernised under the Retail Shop Transformation (TUKAR)
and Automotive Workshop Modernisation (ATOM) programmes, respectively. As
at end of July 2012, 95 workshops have been modernised, surpassing the yearly
target, while 393 retail shops have been modernised.
|
|
|
|
Growth of the sector is anticipated to remain encouraging with
ongoing efforts by the Government to increase its contribution to the
economy. Major initiatives include increasing the number of large format
stores such as hypermarkets, superstores and departmental stores are
carried out to boost the economy.
|
|
|
|
Over 60% of Gross Domestic Product (GDP) is contributed by domestic consumption,
therefore the wholesale and retail sector plays a crucial role in driving
Malaysia's growth over the next decade despite the ongoing global economic
slowdown. By 2020, Malaysia's wholesale and retail sector is expected to
boost the country's total Gross National Income (GNI) by RM156 billion,
creating 454,190 new jobs.
|
|
|
|
|
|
|
OVERALL INDUSTRY OUTLOOK : Average Growth
|
CREDIT RISK EVALUATION &
RECOMMENDATION
|
Incorporated in 2006, the SC is a Private Limited company, focusing on
trading of footwear. Having been in business for 7 years, the SC has
established a remarkable clientele base for itself which has contributed to
its business growth. With a weak shareholders' backing, the SC's capital
position is weak. Inadequate capital may be a constraint to the SC as it
limits its ability to expand its business in future. The capital standing
of the SC is weak. The SC may face difficulties to expand its business compared
to other large corporation. Without a strong capital, the business
expansion opportunities of the SC is limited.
Investigation revealed that the SC concentrates only on the local market.
This narrow market segment has placed the SC at high business risk and
limits its business expansion opportunities. Any adverse changes to the
local economy might have a negative impact on the SC's business
performance. Being a small company, the SC's business operation is
supported by 9 employees. Overall, we regard that the SC's management
capability is average.
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. 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 is in good
liquidity position with its current liabilities well covered by it current
assets. Hence, it has sufficient working capital to meet its short term
financial obligations. However, the high gearing ratio clearly implied that
the SC was supported by more debt than equity. Thus, the SC is exposed to
high financial risk.
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.
The SC's overall payment habit is fair and this clearly implied a weak
credit control of the SC.
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. Nonetheless, the SC should adopt better
competitive strategies in order to sustain its business position and to
compete with other well established players in the same industry.
In view of the above, we recommend credit be granted to the SC with close
monitoring.
|
|
|
PROFIT AND LOSS ACCOUNT
|
THE FINANCIAL
STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIAN FINANCIAL REPORTING
STANDARDS(FRS)
|
|
HOONG QIAN
TRADING SDN. BHD.
|
|
Financial Year End
|
31/12/2011
|
31/12/2010
|
31/12/2009
|
31/12/2008
|
|
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
|
SUMMARY
|
SUMMARY
|
|
Currency
|
MYR
|
MYR
|
MYR
|
MYR
|
|
|
|
|
|
|
|
TURNOVER
|
2,395,698
|
2,394,458
|
1,543,254
|
1,423,697
|
|
Other Income
|
15,780
|
4,367
|
-
|
-
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
Total Turnover
|
2,411,478
|
2,398,825
|
1,543,254
|
1,423,697
|
|
Costs of Goods Sold
|
<1,868,868>
|
<1,887,482>
|
-
|
-
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
Gross Profit
|
542,610
|
511,343
|
-
|
-
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
|
|
|
|
|
|
PROFIT/(LOSS) FROM OPERATIONS
|
59,335
|
37,241
|
23,440
|
20,341
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
PROFIT/(LOSS) BEFORE TAXATION
|
59,335
|
37,241
|
23,440
|
20,341
|
|
Taxation
|
<29,525>
|
<18,419>
|
<10,708>
|
<8,338>
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
PROFIT/(LOSS) AFTER TAXATION
|
29,810
|
18,822
|
12,732
|
12,003
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
RETAINED PROFIT/(LOSS) BROUGHT FORWARD
|
|
|
|
|
|
As previously reported
|
42,410
|
23,588
|
10,856
|
<1,147>
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
As restated
|
42,410
|
23,588
|
10,856
|
<1,147>
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
PROFIT AVAILABLE FOR APPROPRIATIONS
|
72,220
|
42,410
|
23,588
|
10,856
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
RETAINED PROFIT/(LOSS) CARRIED FORWARD
|
72,220
|
42,410
|
23,588
|
10,856
|
|
|
=============
|
=============
|
=============
|
=============
|
|
|
|
|
|
|
|
INTEREST EXPENSE (as per notes to P&L)
|
|
|
|
|
|
Bank overdraft
|
17,259
|
18,042
|
-
|
-
|
|
Hire purchase
|
4,268
|
-
|
-
|
-
|
|
Term loan / Borrowing
|
48,363
|
36,649
|
-
|
-
|
|
Others
|
22,998
|
20,759
|
-
|
-
|
|
|
----------------
|
----------------
|
|
|
|
|
92,888
|
75,450
|
|
|
BALANCE SHEET
|
HOONG QIAN
TRADING SDN. BHD.
|
|
ASSETS EMPLOYED:
|
|
|
|
|
|
FIXED ASSETS
|
798,360
|
701,894
|
307,181
|
296,112
|
|
|
|
|
|
|
|
LONG TERM INVESTMENTS/OTHER ASSETS
|
|
|
|
|
|
TOTAL LONG TERM INVESTMENTS/OTHER ASSETS
|
-
|
-
|
0
|
-
|
|
|
|
|
|
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
TOTAL LONG TERM ASSETS
|
798,360
|
701,894
|
307,181
|
296,112
|
|
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
Stocks
|
147,650
|
89,765
|
-
|
-
|
|
Trade debtors
|
453,214
|
699,425
|
-
|
-
|
|
Other debtors, deposits & prepayments
|
201,825
|
278,325
|
-
|
-
|
|
Short term deposits
|
272,286
|
261,586
|
-
|
-
|
|
Amount due from director
|
339,481
|
118,164
|
-
|
-
|
|
Cash & bank balances
|
28,156
|
14,287
|
-
|
-
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
TOTAL CURRENT ASSETS
|
1,442,612
|
1,461,552
|
1,103,042
|
640,621
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
TOTAL ASSET
|
2,240,972
|
2,163,446
|
1,410,223
|
936,733
|
|
|
=============
|
=============
|
=============
|
=============
|
|
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
Trade creditors
|
465,394
|
342,229
|
-
|
-
|
|
Hire purchase & lease creditors
|
14,749
|
-
|
-
|
-
|
|
Bank overdraft
|
204,212
|
224,205
|
-
|
-
|
|
Short term borrowings/Term loans
|
109,367
|
87,903
|
-
|
-
|
|
Bill & acceptances payable
|
398,000
|
520,000
|
-
|
-
|
|
Other liabilities & accruals
|
36,726
|
104,288
|
-
|
-
|
|
Provision for taxation
|
20,871
|
11,852
|
-
|
-
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
TOTAL CURRENT LIABILITIES
|
1,249,319
|
1,290,477
|
854,881
|
622,478
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
NET CURRENT ASSETS/(LIABILITIES)
|
193,293
|
171,075
|
248,161
|
18,143
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
TOTAL NET ASSETS
|
991,653
|
872,969
|
555,342
|
314,255
|
|
|
=============
|
=============
|
=============
|
=============
|
|
|
|
|
|
|
|
SHARE CAPITAL
|
|
|
|
|
|
Ordinary share capital
|
200,000
|
200,000
|
100,000
|
100,000
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
TOTAL SHARE CAPITAL
|
200,000
|
200,000
|
100,000
|
100,000
|
|
|
|
|
|
|
|
RESERVES
|
|
|
|
|
|
Retained profit/(loss) carried forward
|
72,220
|
42,410
|
23,588
|
10,856
|
|
Others
|
-
|
-
|
10,856
|
-
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
TOTAL RESERVES
|
72,220
|
42,410
|
23,588
|
10,856
|
|
|
|
|
|
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
SHAREHOLDERS' FUNDS/EQUITY
|
272,220
|
242,410
|
123,588
|
110,856
|
|
|
|
|
|
|
|
LONG TERM LIABILITIES
|
|
|
|
|
|
Long term loans
|
650,414
|
629,072
|
-
|
-
|
|
Hire purchase creditors
|
67,678
|
-
|
-
|
-
|
|
Deferred taxation
|
1,341
|
1,487
|
-
|
-
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
TOTAL LONG TERM LIABILITIES
|
719,433
|
630,559
|
431,754
|
203,399
|
|
|
----------------
|
----------------
|
----------------
|
----------------
|
|
|
991,653
|
872,969
|
555,342
|
314,255
|
|
|
=============
|
=============
|
=============
|
=============
|
|
|
|
|
|
|
FINANCIAL RATIO
|
HOONG QIAN
TRADING SDN. BHD.
|
|
TYPES OF FUNDS
|
|
|
|
|
|
Cash
|
300,442
|
275,873
|
-
|
-
|
|
Net Liquid Funds
|
<301,770>
|
<468,332>
|
-
|
-
|
|
Net Liquid Assets
|
45,643
|
81,310
|
248,161
|
18,143
|
|
Net Current Assets/(Liabilities)
|
193,293
|
171,075
|
248,161
|
18,143
|
|
Net Tangible Assets
|
991,653
|
872,969
|
555,342
|
314,255
|
|
Net Monetary Assets
|
<673,790>
|
<549,249>
|
<183,593>
|
<185,256>
|
|
BALANCE SHEET ITEMS
|
|
|
|
|
|
Total Borrowings
|
1,444,420
|
1,461,180
|
-
|
-
|
|
Total Liabilities
|
1,968,752
|
1,921,036
|
1,286,635
|
825,877
|
|
Total Assets
|
2,240,972
|
2,163,446
|
1,410,223
|
936,733
|
|
Net Assets
|
991,653
|
872,969
|
555,342
|
314,255
|
|
Net Assets Backing
|
272,220
|
242,410
|
123,588
|
110,856
|
|
Shareholders' Funds
|
272,220
|
242,410
|
123,588
|
110,856
|
|
Total Share Capital
|
200,000
|
200,000
|
100,000
|
100,000
|
|
Total Reserves
|
72,220
|
42,410
|
23,588
|
10,856
|
|
LIQUIDITY (Times)
|
|
|
|
|
|
Cash Ratio
|
0.24
|
0.21
|
-
|
-
|
|
Liquid Ratio
|
1.04
|
1.06
|
-
|
-
|
|
Current Ratio
|
1.15
|
1.13
|
1.29
|
1.03
|
|
WORKING CAPITAL CONTROL (Days)
|
|
|
|
|
|
Stock Ratio
|
22
|
14
|
-
|
-
|
|
Debtors Ratio
|
69
|
107
|
-
|
-
|
|
Creditors Ratio
|
91
|
66
|
-
|
-
|
|
SOLVENCY RATIOS (Times)
|
|
|
|
|
|
Gearing Ratio
|
5.31
|
6.03
|
-
|
-
|
|
Liabilities Ratio
|
7.23
|
7.92
|
10.41
|
7.45
|
|
Times Interest Earned Ratio
|
1.64
|
1.49
|
-
|
-
|
|
Assets Backing Ratio
|
4.96
|
4.36
|
5.55
|
3.14
|
|
PERFORMANCE RATIO (%)
|
|
|
|
|
|
Operating Profit Margin
|
2.48
|
1.56
|
1.52
|
1.43
|
|
Net Profit Margin
|
1.24
|
0.79
|
0.83
|
0.84
|
|
Return On Net Assets
|
15.35
|
12.91
|
4.22
|
6.47
|
|
Return On Capital Employed
|
12.57
|
10.27
|
4.22
|
6.47
|
|
Return On Shareholders' Funds/Equity
|
10.95
|
7.76
|
10.30
|
10.83
|
|
Dividend Pay Out Ratio (Times)
|
0.00
|
0.00
|
-
|
-
|
|
NOTES TO ACCOUNTS
|
|
|
|
|
|
Contingent Liabilities
|
0
|
0
|
|
|
|