MIRA INFORM REPORT

 

 

Report Date :

01.11.2013

 

IDENTIFICATION DETAILS

 

Name :

GEMTEK TECHNOLOGY CO., LTD.

 

 

Registered Office :

No.15-1, Zhonghua Rd., Hukou Township, Hsinchu County 30352

 

 

Country :

Taiwan

 

 

Financials (as on) :

31.12.2012

 

 

Date of Incorporation :

29.06.1988

 

 

Com. Reg. No.:

22960571

 

 

Legal Form :

Joint Stock Company

 

 

Line of Business :

Manufacture and sales of communication product

 

 

No. of Employees :

About 1200 Employees

 

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 – March, 31st, 2013

 

Country Name

Previous Rating

(31.12.2012)

Current Rating

(31.03.2013)

Taiwan

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 


 

Taiwan - ECONOMIC OVERVIEW

 

Taiwan has a dynamic capitalist economy with gradually decreasing government guidance of investment and foreign trade. Exports, led by electronics, machinery, and petrochemicals have provided the primary impetus for economic development. This heavy dependence on exports exposes the economy to fluctuations in world demand. In 2009, Taiwan's GDP contracted 1.8%, due primarily to a 13.1% year-on-year decline in exports. In 2010 GDP grew 10.7%, as exports returned to the level of previous years, and in 2011, grew 4.0%. In 2012, however, growth fell to 1.3%, because of softening global demand. Taiwan's diplomatic isolation, low birth rate, and rapidly aging population are major long-term challenges. Free trade agreements have proliferated in East Asia over the past several years, but except for the landmark Economic Cooperation Framework Agreement (ECFA) signed with China in June 2010, so far Taiwan has been excluded from this greater economic integration in part because of its diplomatic status. Negotiations continue on such follow-on components of ECFA regarding trade in goods and services. The MA administration has said that the ECFA will serve as a stepping stone toward trade pacts with other key trade partners, which Taiwan subsequently launched with Singapore and New Zealand. Taiwan's Total Fertility rate of just over one child per woman is among the lowest in the world, raising the prospect of future labor shortages, falling domestic demand, and declining tax revenues. Taiwan's population is aging quickly, with the number of people over 65 accounting for 11.2% of the island's total population as of 2012. The island runs a large trade surplus largely because of its surplus with China, and its foreign reserves are the world's fifth largest, behind China, Japan, Saudi Arabia, and Russia. In 2006 China overtook the US to become Taiwan's second-largest source of imports after Japan. China is also the island's number one destination for foreign direct investment. Three financial memorandums of understanding, covering banking, securities, and insurance, took effect in mid-January 2010, opening the island to greater investments from the mainland's financial firms and institutional investors, and providing new opportunities for Taiwan financial firms to operate in China. In August 2012, Taiwan Central Bank signed a memorandum of understanding on cross-Strait currency settlement with its Chinese counterpart. The MOU allows for the direct settlement of Chinese RMB and the New Taiwan dollar across the Strait, which could help develop Taiwan into a local RMB hub. Closer economic links with the mainland bring greater opportunities for the Taiwan economy, but also poses new challenges as the island becomes more economically dependent on China while political differences remain unresolved.

 

Source : CIA

 


Contact Points

 

Company Name:

Gemtek Technology Co., Ltd.

Supplied Name:

GEMTEK Technology

Trading Address:

No.15-1, Zhonghua Rd., Hukou Township, Hsinchu County 30352, Taiwan R.O.C.

Supplied Address:

No.15-1 Zhonghua Road, Hsinchu Industrial Park, Hukou, Hsinchu, Taiwan (R.O.C.) ,30352

Telephone Number:

+886-3-598-5535

Fax Number:

+886-3-597-6663

E-mail:

ru_lu@gemtek.com.tw

Website:

www.gemtek.com.tw/investors.html

Notes: The exact name and address are as above.

 

 

Company Identification Details

 

Registered Name:

GEMTEK TECHNOLOGY CO., LTD.

Registered Address:

No.15-1, Zhonghua Rd., Hukou Township, Hsinchu County 30352, Taiwan R.O.C.

Date of Foundation:

1988-6-29

Registration Number:

22960571

Registry:

Department of Commerce, Ministry of Economic Affairs, R.O.C.

Registered Capital:

NTD 5,000,000,000 (USD 169,500,000)

(As of 2013.10, 1 NTD = 0.0339 USD)

Paid-up Capital:

NTD 3,093,098,910 (USD 104,856,053)

Legal Representatives:

Hongwen Chen

Legal Form:

Joint Stock Company

Principal Activities:

Manufacture and sales of communication product

Staff:

About 1200 Employees

Listed at Stock Exchange:

Yes; Stoke Symbol:4906

Date of Last Annual Return:

2013-8-23

 

 

History

 

Subject was incorporated on 1988-6-29 with registered number 22960571 as Joint Stock Company in Taiwan.

 

Subject listed on Taiwan Stock Exchange on 2003-6-30

 

 

Shareholders

 

Name

Subscription Shares

Hongwen Chen

3,852,937

Fuzan Cai

996,732

Zhengren Yang

1,095,269

Ronghui Xu

927

Yueji Zhang

3,000,715

Liheng investment limited(literal translation)

800,000

Bangmao Investment Co., Ltd. iteral translation)

800,000

Xiucheng Shen

770,795

Zhengtong Wu

200,000

 

The information above is that of subject’s major shareholders.

 

 

Subsidiaries & Branches

 

Related Companies

1

Registered Name:

Liheng investment limited(literal translation)

Registered Address:

7/F, No. 59, Songjiang Road, Zhongshan District, Taipei City

Date of Foundation:

2007-4-23

Registration Number:

28489277

Registry:

Taipei City Goverment

Registered Capital:

NTD 10,000,000 (USD 339,000)

(As of 2013.10, 1 NTD = 0.0339 USD)

Legal Representatives:

Luode Fu

Legal Form:

Private Limited Liability Company

Principal Activities:

General Investment

Listed at Stock Exchange:

No

Date of Last Annual Return:

2011-5-11

2

Registered Name:

Bangmao Investment Co., Ltd. iteral translation)

Registered Address:

3/F, No. 27, Yanyi Road, Xinzhu City

Date of Foundation:

1998-4-27

Registration Number:

16329374

Registry:

MOEA Central Office

Registered Capital:

NTD 400,000,000 (USD 13,560,000)

(As of 2013.10, 1 NTD = 0.0339 USD)

Paid-up Capital:

NTD 370,000,000 (USD 12,543,000)

Legal Representatives:

Maozhen Cai

Legal Form:

Joint Stock Company

Principal Activities:

General Investment

Listed at Stock Exchange:

No

Date of Last Annual Return:

2011-10-13

3

Name:

Gemtek Electronics (Kunshan) Co., Ltd

Address:

No.88, Xinzhu Road, Export Processing Zone Suzhou, Jiangsu 215300. China

Date of Registration:

2005-4-6

Factory Registration Number:

99700207

 

Factories

1

Name:

Hukou Factory

Address:

No. 15-1, Zhonghua Road, Fengshan Village, Hukou Alley, Xinzhu Country

Date of Registration:

2005-4-6

Factory Registration Number:

99700207

Factory Manager:

Hongwen Chen

Status:

In Production

Date of Last Annual Return:

2005-4-6

2

Name:

Xinzhu Factory

Address:

1, 2, 4, 5, F, No. 1, Renai Road, Fengshan Village, Hukou Township, Xinzhu County

Date of Foundation:

1998-9-16

Factory Registration Number:

99630148

Factory Manager:

Hongwen Chen

Status:

In Production

Date of Last Annual Return:

2009-10-27

3

Name:

Zhubei Factory

Address:

No. 41, Manbei Road, Xiangxing Alley, Zhubei City, Xinzhu County

Date of Foundation:

1997-12-31

Date of Registration:

1998-1-14

Date Of Closing Business

1999-10-14

Factory Registration Number:

99196189

Factory Manager:

Hongwen Chen

Status:

Close Business

Date of Last Annual Return:

1999-10-14

4

Name:

Datong factory

Address:

6/F, No. 276, 1 Sec, Datong Road, Xizhi Town, New Taipei City

Date of Foundation:

1995-7-10

Date of Registration:

1996-10-1

Date of Announcement abolished

2004-9-16

Factory Registration Number:

99185016

Factory Manager:

Hongwen Chen

Status:

Announcement abolished

Date of Last Annual Return:

2004-9-16

 

 

Personnel Information

 

Core Management

 

Directors

1

Name

Hongwen Chen

Position

Board Chairman

2

Name

Fuzan Cai

Position

Director

3

Name

Zhengren Yang

Position

Director

4

Name

Ronghui Xu

Position

Director

5

Name

Yueji Zhang

Position

Director

6

Name

Yaogeng Zhao

Position

Independent Director

7

Name

Xiaoyun Teng

Position

Independent Director

8

Name

Xiucheng Shen

Position

Supervisor

9

Name

Zhengtong Wu

Position

Supervisor

10

Name

Limei Huang

Position

Supervisor

 

Personnel Structure

 

Total Employees

About 1200 Employees

 

 

Operation Information

 

Offices & Factories

 

 

Headquarters

Add

No.15-1, Zhonghua Rd., Hukou Township, Hsinchu County 30352, Taiwan R.O.C.

 

Production Information

 

Subject is engaged in manufacturing of communication product, etc.

Subject has factories in Taiwan and the mainland of China for production.

Subject obtained the certification of ISO9001, ISO 14001.

 

Purchase Information

 

The registered activities of subject:

Business Code

Details

--

Electronic components, semi-finished and finished products of research and development, manufacture and sale

--

Computer software, hardware and peripheral equipment research and development, manufacture and sale

--

The import and export trade business above

CC01101

Controlled telecommunications radio-frequency devices manufacturing

F401021

The controlled telecommunications radio-frequency devices of input industry

E701030

The controlled telecommunications radio-frequency devices installed engineering

F113070

Telecommunications equipment wholesale business

F213060

Telecommunications equipment retail

 

The components and raw material for production are purchased from both home and abroad.

 

Sales Information

 

The subject is mainly engaged in sales of communication product, etc.

The major products sold by subject include wireless networking products, broadband systems, network security systems, voice over internet protocol, worldwide interoperability for microwave access, digital home products, UWB and wireless SIP, bluetooth and GPS module, etc.

The subject sales regions include Asia, America, Europe, etc.

 

Import and export right:

Import right

Yes

Export right

Yes

 

 

 

Settlements

 

Purchase

 

Domestic Purchase

Product

Terms

Proportion

Components And Raw Material

Cash, T/T, etc

100%

 

Foreign Purchase

Product

Terms

Proportion

Components And Raw Material

L/C, etc

100%

 

Sales

 

Domestic Markets

Product

Terms

Proportion

Communication product, etc.

T/T, Cash, etc

100%

 

Export

Product

Terms

Proportion

Communication product, etc.

L/C, etc

100%

 

 

Balance Sheet

 

Unit: NTD/000

 

2012-12-31

2011-12-31

Assets

 

 

Current Assets

 

 

Cash and cash equivalents

1,141,298.00

502,470.00

Financial assets measured at fair value through profit or loss - current

149,877.00

42,712.00

Notes receivable - net

15,044.00

2,677.00

Accounts receivable - net

3,344,405.00

4,479,882.00

Other receivables - related parties

439,183.00

1,163,225.00

Inventories

245,441.00

382,815.00

Other current assets

239,654.00

238,590.00

Current assets

5,574,902.00

6,812,371.00

Funds and Investments

 

 

Available-for-sale financial assets - non current

110,979.00

6,276.00

Financial assets carried at cost - non current

135,960.00

20,991.00

Investments

4,925,664.00

5,274,186.00

Funds and long-term investments

5,172,603.00

5,301,453.00

Fixed Assets

 

 

Cost

 

 

Land

328,168.00

328,168.00

Buildings and structures

1,516,702.00

1,515,435.00

Machinery and equipment

228,317.00

277,198.00

Other facilities

263,218.00

232,391.00

Fixed assets cost

2,336,405.00

2,353,192.00

Accumulated depreciation

-701,775.00

-630,693.00

Construction in process and prepayment for equipments

144.00

0.00

Fixed assets

1,634,774.00

1,722,499.00

Intangible Assets

 

 

OtherAssets

 

 

Other assets - other

128,532.00

151,861.00

Other assets

128,532.00

151,861.00

Assets

12,510,811.00

13,988,184.00

Liabilities and Stockholders' Equity

 

 

Liabilities

 

 

Current Liabilities

 

 

Short-term borrowings

203,280.00

1,180,725.00

Financial liabilities measured at fair value through profit or loss - current

29,919.00

0.00

Notes payable

30,860.00

58,888.00

Accounts payable

256,927.00

346,751.00

Accounts payable - related parties

377,529.00

1,600,020.00

Income tax payable

130,781.00

41,535.00

Accrued expenses

316,387.00

249,295.00

Other payables - related parties

37,970.00

73,147.00

Advance receipts

124,485.00

75,176.00

Other current liabilities

48,801.00

57,981.00

Current liabilities

1,556,939.00

3,683,518.00

Long term Liabilities

 

 

Financial liabilities measured at fair value through profit or loss - non current

976.00

20,976.00

Bonds payable

1,873,497.00

1,839,316.00

Long-term liabilities

1,874,473.00

1,860,292.00

Reserves

 

 

Other Liabilities

 

 

Other liabilities - other

240,596.00

212,542.00

Other liabilities

240,596.00

212,542.00

Liabilities

3,672,008.00

5,756,352.00

Stockholders' Equity

 

 

Capital

 

 

Common stock

3,050,853.00

3,098,602.00

Capital Surplus

 

 

Capital surplus - additional paid-in capital

4,141,356.00

4,299,152.00

Capital surplus - long-term equity investments

60,350.00

58,076.00

Capital surplus - other

161,455.00

161,455.00

Capital surplus

4,363,161.00

4,518,683.00

Retained Earnings

 

 

Legal reserve

484,093.00

648,213.00

Unappropriated retained earnings

854,267.00

-164,120.00

Retained earnings

1,338,360.00

484,093.00

Stockholders' Equity and Other adjustmen

 

 

Cumulative translation adjustments

142,851.00

308,813.00

Unrealized gains (losses) on financial instruments

-56,422.00

-40,434.00

Treasure stock

0.00

-137,925.00

Equity adjustments

86,429.00

130,454.00

Stockholdersˉ equity

8,838,803.00

(USD 299,635,421.70)

8,231,832.00

(USD 279,059,104.80)

Number of treasury stock acquired by the company and subsidiaries (unit: share)

0.00

3,057.00

 

0.00

0.00

(As of 2013.10, 1 NTD = 0.0339 USD)

 

 

Profit and loss account

 

Unit: NTD/000

 

2012

2011

Sales

24,070,973.00

(USD 816,005,984.70)

25,993,264.00

(USD 881,171,649.60)

Operating income

24,070,973.00

25,993,264.00

Cost of sales

21,012,770.00

23,794,220.00

Operating costs

21,012,770.00

23,794,220.00

Gross profit (loss) from operations

3,058,203.00

2,199,044.00

Selling expense

603,084.00

811,954.00

General and administrative expenses

247,850.00

228,804.00

Research and development expenses

1,011,534.00

997,781.00

Operating expenses

1,862,468.00

2,038,539.00

Operating income (loss)

1,195,735.00

160,505.00

Non-Operating Income

 

 

Interest income

2,287.00

6,107.00

Dividends

3,543.00

3,540.00

Investment income

3,543.00

3,540.00

Gains on disposal of fixed assets

0.00

460.00

Gains on sale of investments

2,391.00

0.00

Foreign exchange gains

0.00

115,083.00

Revaluation gain on financial assets

64,965.00

0.00

Miscellaneous income

59,383.00

49,239.00

Non-operating revenues and gains

132,569.00

174,429.00

Non-Operating Expenses

 

 

Interest expense

50,090.00

56,286.00

Losses from long-term equity investments under the equity method

223,491.00

145,513.00

Investment loss

223,491.00

145,513.00

Loss on disposal of fixed assets

1,510.00

0.00

Loss on sale of investments

0.00

34,320.00

Foreign exchange losses

39,452.00

0.00

Impairment loss on assets

20,000.00

0.00

Revaluation loss on financial assets

0.00

15,218.00

Miscellaneous disbursements

31.00

5,125.00

Non-operating expenses and losses

334,574.00

256,462.00

Income from continuing operations before income tax

993,730.00

78,472.00

Income tax expense (benefit)

71,506.00

66,910.00

Income from continuing operations

922,224.00

11,562.00

Net income (loss)

922,224.00

(USD 31,263,393.60)

11,562.00

(USD 391,951.80)

Primary Earnings per Share

 

 

Primary earnings per share

3.01

0.04

Diluted earnings per share

 

 

Diluted earnings per share

2.53

0.04

 

 

Cash flow

 

Unit: NTD/000

 

2012

2011

Cash Flows from Operating Activities - Indirect Method

 

 

Net Income (Loss)

922,224.00

11,562.00

Adjustments to Reconcile Net Income to Net Cash Provided by (Used in) Operating Activities

 

 

Depreciation Expense

117,506.00

136,036.00

Amortization Expense

106,975.00

116,167.00

Provision (Reversal of Provision) for Bad Debts Losses

0.00

129,458.00

Amortization of Discounts (Premiums) on Bonds Payable

34,181.00

24,696.00

Effects of Exchange Rate Changes Of Bonds Payable

0.00

44,060.00

Loss (Gain) on Decline (Recovery) in Market Value, Scrap and Obsolescence of Inventories

-12,530.00

8,000.00

Loss (Gain) on Physical Inventory

265.00

-1.00

Investment Loss (Income) Recognized under Equity Method

223,491.00

145,513.00

Cash Dividends Received from Investments Accounted for under Equity Method

0.00

175,000.00

Loss (Gain) on Disposal of Property, Plan and Equipment

1,510.00

-460.00

Loss (Gain) on Disposal of Investments

-281.00

0.00

Unrealized Revaluation Loss (Gain) on Financial Assets and Liabilities

-64,965.00

15,218.00

Impairment Loss on Non-Financial Assets

20,000.00

0.00

Loss (Gain) on Deferred Income Tax

-63,697.00

17,175.00

Other Adjustments to Reconcile Net Income

0.00

-1,381.00

Changes in Operating Assets and Liabilities

 

 

Decrease (Increase) in Financial Assets Held for Trading

-32,000.00

0.00

Decrease (Increase) in Accounts Receivable

1,123,110.00

880,694.00

Decrease (Increase) in Other Receivable- Related Parties

724,042.00

-764,840.00

Decrease (Increase) in Inventories

149,639.00

138,215.00

Decrease (Increase) in Other Current Assets

85,413.00

37,813.00

Increase (Decrease) in Accounts Payable

-1,340,343.00

-1,874,981.00

Increase (Decrease) in Income Tax Payable

89,246.00

38,462.00

Increase (Decrease) in Accrued Expenses

67,092.00

-54,547.00

Increase (Decrease) in Other Payable - Related Parties

-35,177.00

73,147.00

Increase (Decrease) in Receipts in Advance

49,309.00

-14,679.00

Increase (Decrease) in Other Current Liabilities

-9,180.00

46,797.00

Net Cash Provided by (Used in) Operating Activities

2,155,830.00

-672,876.00

Cash Flows from Investing Activities

 

 

Acquisition of Available-for-sale Financial Assets

-123,191.00

0.00

Proceeds from Disposal of Available-for-sale Financial Assets

-134,969.00

0.00

Acquisition of Investments Accounted for by Equity Method

-30,883.00

-227,393.00

Purchase of Property, Plant and Equipment

-37,235.00

-40,029.00

Proceeds from Disposal of Property, Plant and Equipment

5,944.00

3,396.00

Decrease (Increase) in Refundable Deposits

-962.00

184.00

Increase in Deferred Charges

-79,750.00

-84,001.00

Decrease (Increase) in Other Assets

-2,934.00

-3,609.00

Net Cash Provided by (Used in) Investing Activities

-403,980.00

-351,452.00

Cash Flows from Financing Activities

 

 

Increase (Decrease) in Short-term Loans

(977,445)    (

1,158,590)

Proceeds from Issuance of Bonds

0.00

1,994,820.00

Repayments of Bonds

0.00

-4,400.00

Cash Dividends Paid

-92,041.00

-260,965.00

Exercise of Employee Stock Options

0.00

61,382.00

Purchase of Treasury Stock

-43,536.00

0.00

Net Cash Provided by (Used in) Financing Activities

-1,113,022.00

632,247.00

Net Increase (Decrease) in Cash and Cash Equivalents

638,828.00

-392,081.00

Cash and Cash Equivalents, Beginning of year

502,470.00

894,551.00

Cash and Cash Equivalents, End of year

1,141,298.00

502,470.00

Supplemental Cash Flow Information

 

 

Interest Paid

16,316.00

33,083.00

Interest Paid- Excluding Capitalized Interest

16,316.00

33,083.00

Income Tax Paid

45,958.00

8,954.00

Non-cash Investing and Financing Activities

 

 

Conversion of Bonds to Common Stock

0.00

821,729.00

Accounts Receivable - Related Parties Transferred to Investments

0.00

291,300.00

Treasury Stock Retired

181,461.00

0.00

 

 

Bankers

 

Subject declined to disclose its bank details; from other source we cannot obtain the relevant information, either.

 

 

Public Record

 

Mortgage

 

No chattel mortgage record of subject has been found within the recent 3 months.

 

Lawsuit

 

1

Trial Number:

2011,Zhongsu, 137

Date of Trial:

2012-12-7

Reason:

Payment for damages

2

Trial Number:

2010, Bu, 982

Date of Trial:

2010-11-29

Reason:

Payment for damages

 

 

Interview Details

 

Department

Sales Department

 

 


 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.61.41

UK Pound

1

Rs.98.29

Euro

1

Rs.84.12

 

 

INFORMATION DETAILS

 

Report Prepared by :

SDA

 

 

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.