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Report Date : |
20.06.2013 |
IDENTIFICATION DETAILS
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Name : |
HARSA
STUDIO – SANITARYWARE MANUFACTURERS LTD. |
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|
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Registered Office : |
P.O.
Box 30 Hebron Road Industrial Zone Beer Sheva 8410001 |
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Country : |
Israel |
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Financials (as on) : |
31.03.2013 |
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Date of Incorporation : |
20.01.1985 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturers,
exporters and marketers of ceramic and sanitary tools, including: toilet
bowls, mono-blocks for sinks, urinals, basins and ancillary accessories
(under the brand name "Harsa"), as well as plastic
installation products (under the brand name "Lipski"). |
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No. of Employees : |
Having 348
employees serving HAMAT GROUP as (had
373 employees in the end of 2011), of which some 110
serving subject itself (had some 130 in the end of 2011, number decresed due
to stramlining). |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Good |
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Payment Behaviour : |
No Complaints |
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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, 2013
|
Country Name |
Previous Rating (31.12.2012) |
Current Rating (31.03.2013) |
|
Israel |
A2 |
A2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
ISRAEL - ECONOMIC OVERVIEW
Israel has a technologically advanced market economy. Its
major imports include crude oil, grains, raw materials, and military equipment.
Cut diamonds, high-technology equipment, and pharmaceuticals are among the
leading exports. Israel usually posts sizable trade deficits, which are covered
by tourism and other service exports, as well as significant foreign investment
inflows. The global financial crisis of 2008-09 spurred a brief recession in
Israel, but the country entered the crisis with solid fundamentals - following
years of prudent fiscal policy and a resilient banking sector. The economy has
recovered better than most advanced, comparably sized economies. In 2010,
Israel formally acceded to the OECD. Israel''s economy also has weathered the
Arab Spring because strong trade ties outside the Middle East have insulated
the economy from spillover effects. Natural gasfields discovered off Israel''s
coast during the past two years have brightened Israel''s energy security
outlook. The Leviathan field was one of the world''s largest offshore natural
gas finds this past decade, and production from the Tama field is expected to
meet all of Israel''s natural gas demand beginning mid-2013. In mid-2011,
public protests arose around income inequality and rising housing and commodity
prices. The government formed committees to address some of the grievances but
has maintained that it will not engage in deficit spending to satisfy populist
demands.
Source
: CIA
HARSA STUDIO – SANITARYWARE MANUFACTURERS LTD.
Telephone
972 8 646 43 11
Fax 972 8 646 43 67
P.O. Box 30
Hebron Road
Industrial Zone
BEER SHEVA 8410001 ISRAEL
A private limited company, incorporated as per file No.
51-105240-9 on the 20.01.1985, under the name of H.I.S. HOUSEHOLD GOODS AND
GIFTS MARKETING CO. LTD.
Until 1989 subject served as an importing and marketing
arm for some of the ceramic enterprises (known as MERHAV Group) of KOOR Group
(former owner of MERHAV). In 1989 it sold its business activities, becaming
non-active.
Company was re-activated in January 1993 when it took over
the business activities of SOLCOOR ARAD MARKETING AND PURCHASING CO. (1965)
LTD., which operated a bathroom and household accessories chain store, and as a
result changed its name to SOLCOOR CENTER LTD. on the 04.01.1993.
In December 1998, it was decided to cease the activities
of SOLCOOR, and following that, subject became a holding company.
In 1999 MERHAV Group (including HARSA plant) was sold by
KOOR to new investors, L.M. LIPSKY. During 2000, MERHAV Group transferred all
manufacturing and marketing activities of HARSA ISRAEL CERAMIC WORKS LTD. (established
in early 1950s) to subject. Consequently name changed to the present one on the
07.03.2000.
Authorized share capital NIS 25,000,000.00 and (old)
NIS 5,000,000.00, divided into -
5,000,000,000
ordinary shares of NIS 0.001 each (4,949,004,900 shares issued),
25,000,000
ordinary shares of NIS 1.00 each (22,463,000 shares issued) ,
of which shares amounting to NIS 27,412,004.90 were
issued.
(Note: The currency in share capital was
originally in Old Israeli Shekel whose nominal value was 1 thousandth of
the current New Israeli Shekel (NIS), converted in 1986).
Subject is fully controlled by HAMAT GROUP LTD. (formerly MERHAV - CERAMIC
AND BUILDING MATERIALS CENTER LTD. - name changed in May 2013), 99.8%, a public
limited company whose shares are traded on the Tel Aviv Stock Exchange,
controlled (64%) by Yoav Golan (via NIOR HOLDINGS (1994) LTD.).
Note: The remaining 0.2% is held by NOFET TZOFIM
LTD., a private limited company owned by 3rd parties, erased from
the Registrar of Companies.
In July 2012 a
transaction, which was divided into 3 phases, was completed, in which Yoav
Golan (via NIOR) acquired 64% of HAMAT
GROUP
shares from the previous controlling shareholders KETER PLASTIC LTD. and FIMI
Fund, for total sum of around NIS 202 million (see more CHARACTER).
1. Yoav Golan, Chairman of HAMAT GROUP,
2. Nir Golan,
3. Binyamin Saporta.
1. Yigal Moran,
General Manager of HAMAT GROUP,
2. Nir Klein, subject's
General Manager.
Manufacturers, exporters and marketers of ceramic and
sanitary tools, including: toilet bowls, mono-blocks for sinks, urinals, basins
and ancillary accessories (under the brand name "Harsa"), as well as plastic installation
products (under the brand name "Lipski").
Most sales are to the local market.
Among clients: LEVY BROS. - CERAMIC IMPORTERS, MASHIACH
CERAMICA, Y. D. DEKEL CERAMICS, TOPOLSKI & CO., OZ CERAMICS, A. A. CERAMIC,
NEGEV CERAMICS, KORESH CENTER, TUBOUL CERAMICA, SARA CERAMICS, ALONY MARBLE,
AMAR BROS., GERSHON VLOSKO, etc.
Raw materials are purchased both locally and from abroad
(England, Turkey, Bulgaria and Germany).
Operating from offices and a large plant, on a built area of
25,000 sq. meters (85,000 sq. meters plot),
owned by HAMAT GROUP, in Hebron Rd., Industrial Zone, Beer Sheva, from a rented
plastic plant ("Lipski"), on an area of 12,000 sq. meters in Barkan
Industrial Zone, as well as from a showroom in Bnei Brak and 2 customer service
centers.
Having 348
employees serving HAMAT GROUP as (had 373
employees in the end of 2011), of which some
110 serving subject itself (had some 130 in the end of 2011, number decresed
due to stramlining).
Financial data is
included in the consolidated B/S of parent company, HAMAT GROUP LTD., which shows:
Note: Parent HAMAT GROUP is a holding company, and all business activities
are conducted via its 2 subsidiaries, subject being one of them and the other is HAMAT SANITARY FITTINGS AND CASTINGS LTD.
NIS
(thousands)
ASSETS 31.12.2012 31.03.2013
Current assets
Cash and cash equivalents 2,926 3,520
Customers 105,987 106,579
Other debtors 1,948 1,563
Stock 54,178 52,326
165,039 163,988
Non-current assets
Pre-paid expenses for
operational leasing 394 349
Fixed assets (net) 112,548 113,666
112,942 114,015
277,981 278,003
======= =======
LIABILITIES
Current
liabilities 122,540 130,669
Non-current
liabilities 26,384 26,592
Equity 129,057 120,742
277,981 278,003
======= =======
Parent HAMAT GROUP current market value US$ 60.6 million.
Subject is an “Approved Enterprise” and as such enjoys tax
benefits and State incentives. In 1998, the Israeli Investment Center (IIC) has approved
the expansion of the “HARSA” plant in Beer Sheva, with investment of US$ 11.4
million.
In July 2012 subject received a notice from IIC that due
to not meeting certain goals posed by IIC for the incentives approved in 1998,
IIC decided to demand from subject grants refunds summing to NIS 6.5 million.
Subject filed an appeal to IIC (see more in CHARACTER).
There are 2 charges for unlimited amounts registered on
the company's assets, in favor of the State of Israel (charges placed in April
–June 2000).
HAMAT GROUP LTD.
Consolidated
Statement of Income
NIS
(thousands)
Year
ended 31.12
2010 2011 2012
Sales 267,681 268,532 258,937
Gross profit 90,681 90,189 85,869
Operating income 46,392 43,605 42,189
Profit before taxes on income 45,723 38,722 39,979
Net income 34,255 29,310 29,997
======= ======= =======
HAMAT
GROUP consolidated
first 3 months of 2013 sales were
NIS 63,000,000 (5.8% decrease comparing to
the parallel period in 2012), making a gross profit of NIS 19,821,000, an operating income of NIS 9,590,000 and a net profit of NIS 6,593,000.
HAMAT GROUP publishes in its financial statements the sales by the
Sanitary Tools Segment, which are attibuted to subject:
2010 sales were NIS 80,946,000.
2011 sales were NIS 76,664,000.
2012 sales were NIS 64,510,000.
Sales for the first 3 months of 2013 were NIS 16,527,000.
Sales
by the
Installation Products Segment (Lipski)
also attibuted to subject:
2010 sales were NIS 43,270,000.
2011 sales were NIS 47,835,000.
2012 sales were NIS 54,762,000.
Sales for the first 3 months of 2013 were NIS 12,938,000.
Subject ended 2008 with a net profit of NIS
8,529,000.
Subject ended 2009 with a net profit of NIS
11,233,000.
Subject ended 2010 with a net profit of NIS
12,014,000.
Subject ended 2011 with a net profit of NIS
6,315,000.
Subject ended 2012 with a net profit of NIS
8,698,000.
HARSA DESIGN AND MARKETING LTD., 100%, marketers of
subject’s products.
HAMAT GROUP LTD., an industrial holding company, engaged in
design, manufacturing, import, export and marketing of building finishing
products, divided into 3 main categories:
"Hamat" faucets & bathroom accessories; "Lipski"
plastic installation products and "Harsa" sanitary ware by subject;
also deals in showers cubicles. Also holds:
HAMAT SANITARY
FITTINGS AND CASTINGS LTD., designers, manufacturers, exporters and marketers
of faucets, bathroom accessories and related piping.
Yoav Golan also
holds:
ASHDOD TIMBER
TRADE LTD., importers and marketers of timber and roof tiles.
NIOR WOOD
INDUSTRIES LTD., 100%, wood processing, re-cuts timber for roofing purposes and
permeates cut wood with preservative.
POLEG TIMBER TRADE
LTD., 100%, timber & roof tiles trade and retail,
BEN BENAYMIN - NOIMAN
LTD., 50%, wood processing plant, timber trade,
LOGISTIC POINT
LTD. (formerly DANEL B
NIOR HOLDINGS
(1994) LTD., a holding company.
Group's annual consolidated
sales are around NIS 110 million (excluding subject).
Poalei Agudat
Israel Bank Ltd., Ashdod Branch (No. 186),
Ashdod, account No. 880027.
A check with the Central Banks' database did not reveal any negative
information regarding subject's a/m account.
As a/m currently there is a disute between subject and IIC
regarding IIC demand for the return of NIS 6.5 million by subject due to not
meeting meeting certain goals posed by IIC for the incentives approved in 1998,
mainly employee recruitment. HAMAT GROUP's officials claim that subject is
facing harsh copatition from abroad, and pay high energy cost due to not being
connected to the natural gas spply grid. According to a report from April 2013,
subject threatens to close down its plant in Beer Sheva and lay-off its
employees if it will be forced to give back the incentive.
Apart from that, nothing unfavorable learnt.
In March 2011 Yoav
Golan signed a deal to acquire the control (64%) of HAMAT GROUP from KETER PLASTIC LTD. and FIMI Fund in 3 gradual
phases spread over the years 2011 and 2012. The first stage was completed in
April 2011, in which Yoav Golan acquired 47.4% for NIS 147.3 million. Stages 2
& 3 (were optional) were completed in April 2012 (12.5% for NIS 42.1
million) and July 2012 (4.1% for NIS 13.7 million), respectively. Some
conflicts rose during early 2012 between the parties regarding the deal price,
eventually resolved (the selling parties may refund certain sums to the buyer
in the future).
HAMAT GROUP is one of the leading companies in Israel and the
largest exporter in their field.
Subject is ISO 9001 certified.
The veteran MERHAV Group (today HAMAT GROUP), whose
activities started originally in 1951, with its “Hamat” (sister company),
“Harsa” and “Lipski” (both subject) brands, are well-known locally.
In April 1999
former parent company L.M. LIPSKI LTD. acquired from KOOR the controlling
shares in subject’s parent (76.37%), based on a value of NIS 40.5 million.
LIPSKY's operations were later merged into subject's operations.
In November 2007
subject invested in re-branding and in new production line, reportedly NIS 3.5
million. Local market for bathroom furniture is estimated at NIS 100 million
per annum.
In May 2008 it was
reported that subject launched a prestigious bathroom furniture line with NIS 2
million investment.
In October 2009 it
was reported that subject and sister company are opening a showroom in Bnei
Brak, investing NIS 2 million.
From the Central Bureau of Statistics preliminary National Accounts for
2012, it rises that Investments in Fixed Assets rose by 3.7% from the previous
year, after rising by 16% in 2011 and by 12.2% in 2010. In 2012 there was an
increase in construction for dwelling – by 5.7% (after rising by 12.5% in 2011
and 12.8% in 2010), increase by 1.6% in construction not for dwelling and other
construction works (e.g. roads, offices, industrial, institutional), after it
grew by 6.6% in 2011.
Investment in construction for dwelling in 2011 was divided into rise of
13.1% by private building and 17.8% by public building.
Private consumption expenditure by households in
2012 on Housing and on Housing Equipment grew by 3% and fell by 2.7% from 2011,
respectively, in annual calculation (grew by 2.8% and 20%, respectively, in
2011 from 2010).
The building sector indicators show ambiguous signs in recent periods.
Volume of building starts for dwelling (which is an indicator for the trend in
the building sector) in 2012 indicated a 13% decrease from 2011, reaching close
to 40,000 new apartments, though building starts in the 4th quarter
marked a 40% rise from the previous quarter. The decline in 2012 came after a
growth trend in building starts in the previous couple of years (9% in 2011 and
7% rise in 2009).
On the other hand, after in 2011 the number of dwellings transactions
fell by 18% from 2010, an increase in acquisition of dwellings was noted in
2012 by same rate of 18%, though the Government expects the number to fall in
2013 following steps taken.
Notwithstanding the a/m dispute with IIC, considered dood
for trade engagements.
Maximum unsecured credit recommended US$ 400,000
Note: Since February 2013 Israel Post has started
using a new area code method of 7 digits (the old method of 5 digits is no
longer valid).
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.58.74 |
|
|
1 |
Rs.91.99 |
|
Euro |
1 |
Rs.78.70 |
INFORMATION DETAILS
|
Report
Prepared by : |
PRL |
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.