MIRA
INFORM REPORT
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Report Date : |
23.11.2013 |
IDENTIFICATION DETAILS
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Name : |
ARAD TEXTILE INDUSTRIES LTD. |
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Registered Office : |
P.O. Box 1092 (7019802), 1 Kinneret Street, AirPort City
Park, Airport City 7019900 |
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Country : |
Israel |
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Date of Incorporation : |
27.04.1981 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturers, exporters and marketers of towels. |
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No. of Employees : |
500 employees |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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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
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Country Name |
Previous Rating (31.12.2012) |
Current Rating (31.03.2013) |
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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.
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Source
: CIA |
compnay nmae and address
ARAD TEXTILE INDUSTRIES LTD.
Telephone 972
3 519 37 77
Fax 972
3 519 37 85
P.O. Box 1092 (7019802)
1 Kinneret Street
AirPort City Park
Airport City 7019900 Israel
HISTORY & LEGAL FORMATION
Originally established in 1976, and incorporated as a private limited
company as per file No. 51-088494 on the 27.04.1981.
Converted into a public limited liability company as per file No.
52-003955-3 on the 27.06.1993.
In July 1993 published a prospectus offering shares to the public on the
Tel Aviv Stock Exchange.
In October 2001, following a successful tender offer, subject’s shares
were de-listed from trade in the Tel Aviv Stock Exchange.
Originally registered under the name ARAD TOWELS LTD., which changed to
the present name on the 01.01.2003.
SHARE CAPITAL
Authorized share capital NIS 41,250,000.00 divided into -
41,250,000 ordinary shares of NIS 1.00 each,
of which 40,267,551 shares amounting to NIS 40,267,551.00 were issued.
SHAREHOLDERS
Subject is fully owned by STANDARD TEXTILE (EUROPE) LTD., controlled by
STANDARD TEXTILE CO. INC, USA, controlled by Gary Heyman & family, of the
USA.
STANDARD TEXTILE acquired the public shares in subject in October 2001.
DIRECTORS
1. Gary Heyman, Chairman,
President & CEO of STANDARD TEXTILE,
2. David Mizrahi, General
Manager (since August 2013).
BUSINESS
Manufacturers, exporters and marketers of towels.
Also manufacturers, exporters and marketers of fabrics (mainly apparel
and accessories for the operation rooms).
Manufacturing is also via affiliated Jordanian plant (C.I.G.) and
subcontractors in Israel (Mitzpe Ramon) and in Jordan.
Local customers are mainly institutional: hotels, hospitals, Israel
Defense Force, Israel Prisons Service, Health Ministry, etc.
87% of sales are for export. Some 60% of sales are to parent company in
the USA.
Subject produces approximately 70 million towels annually, mainly to
Europe and the USA. Amongst subject's customers are major U.S. hotel chains
such as MARRIOTT, STARWOOD, GAYLORD, HARRAHS, DIAMOND RESORTS, MGM, high-end
Las Vegas casino hotels, the French hotel chain ACCOR and most of Europe's
large industrial laundries, which provide towels for hotels and health care
facilities.
Among local suppliers: P.A.T. COMPRESSED AIR TECHNOLOGY, CARGAL,
FRIDENSON LOGISTIC SERVICES TRANSPORT, HAMENIA PUMPS, TCHELET DYEING &
FINISHING, etc.
Operating from headquarters offices, on an area of over 400 sq. meters,
in 1 Kinneret Street, AirPort City Park, situated near the Ben
Gurion International Airport, and from 2 plants in Migdal Haemek (owned, on an
area of 4,000 sq. meters) and Arad (one third owned, on an area of 50,000 sq.
meters).
Also operating from several retail stores throughout Israel.
Having 500 employees (similar to 2012).
MEANS
Current stock is valued at NIS 36 million (was valued at NIS 35 million
in end of 2012).
Subject is an “Approved Enterprise” and as such enjoys State incentives
and tax benefits.
In July 1997, the Israeli Investment Center (IIC) approved a US$ 2
million investment plan for the expansion of subject’s plant.
In August 2001 and in January 2005 the IIC approved further investment plans
of US$ 9.6 million and US$ 5.4 million respectively for the expansion of
subject’s plant.
There are 7 charges for unlimited amounts registered on the company’s
assets (financial, fixed and other assets), in favor of the State of Israel,
Mizrahi Tefahot Bank Ltd., The First International Bank of Israel Ltd., Bank
Leumi Le’Israel Ltd., Bank Hapoalim Ltd. and Israel Discount Bank Ltd. (last
charge placed in 2007).
REVENUES
Consolidated 2007 sales claimed to be US$ 100,000,000, 90% for export.
Estimated pre-tax profit according to reports from October 2007, stand
on US$ 11-12,000,000. Net profit estimated at 9% of turnover annually.
Consolidated 2008 sales claimed to be US$ 110,000,000, 90% for export.
Consolidated 2009 sales claimed to be US$ 80,000,000, 90% for export.
Consolidated 2010 sales claimed to be US$ 98,000,000, 85% for export.
Consolidated 2011 sales claimed to be US$ 111,000,000, 87% for export.
Consolidated 2012 sales claimed to be US$ 110,000,000, 87% for export.
Consolidated sales for the first half of 2013 claimed to be US$
56,000,000, 87% for export.
OTHER COMPANIES
ARAD TOWELS ASSETS (1986) LTD.,
STANDARD TEXTILE (EUROPE) LTD., a holding company,
C.I.G., 50% controlled by STANDARD TEXTILE USA and 50% by a Jordanian
company, a sewing plant located in Irbid, Jordan.
BANKERS
Bank Leumi Le’Israel Ltd., Central Branch (No. 800), Tel Aviv, account
No. 265700/07.
Bank Hapoalim Ltd., Yahalom Branch (No. 537), Tel Aviv, account No.
76026.
A check with the Central Banks' database did not reveal anything
detrimental on subject’s a/m main accounts.
Working also with:
Mizrahi Tefahot Bank Ltd., Tel Aviv Main Business Center Branch (No.
461), Tel Aviv.
The First International Bank of Israel Ltd., Tel Aviv Main Branch (No.
061), Tel Aviv.
Israel Discount Bank Ltd., Main Branch (No. 010), Tel Aviv.
CHARACTER AND REPUTATION
Nothing unfavorable learned (please refer to NOTE 2 below).
Parent company, STANDARD TEXTILE CO. INC, is a global manufacturers of
healthcare, hospitality and institutional textiles, apparel, surgical,
incontinence care, decorative products & linen. With 3,600 employees
worldwide in 23 plants over 13 countries, customers in some 60 countries and
global annual sales of US$ 650 million.
In January 1999 subject’s parent, STANDARD TEXTILE (EUROPE) LTD.
acquired some 41% of subject's shares from D.G.M.A., of the DELTA GALIL
INDUSTRIES Group, in consideration of US$ 17.5 million.
In December 1999 STANDARD purchases further 5% of subject's shares from
Yossef Geva, in consideration of US$ 2.4 million.
Later, in October 2001, STANDARD reached full ownership in subject,
after it acquired the reminder of D.G.M.A. shares, in consideration of
allocating them 15% in STANDARD.
In March 2007 it was reported that subject is erecting a retail chain
store for home textile under the name "Bed & Bath Home
Collection".
In the first stage, 7 shops will be opened,
In February 2008 STANDARD singed an agreement for the supply of towels to the French hotel
chain ACCOR, one of the largest resort & hotel companies in the world (a continuating agreement), amounting to some € 45 million, thus
becoming the sole supplier for the Chain. Subject's share in this deal is some
€ 27 million. As a result, it was reported that subject will expand its plant
by further 3,000 sq. meters.
In April 2008 STANDARD singed a continuation agreement for the supply of towels
and beddings to the American hotel chain MARRIOTT, one of
the largest resort & hotel companies in the world, amounting to NIS 252 million, thus becoming the sole supplier for the
North America and Canadian hotels. Subject's share in this deal is production
of some 18 million towels.
In August 2008 Gary Heiman,
President & CEO of STANDARD TEXTILE CO. and subject’s Chairman was one of
the among the 12 honorees who received special awards for their contribution to
the Negev Region (south of Israel) industry promotion.
During the end of 2008 and the beginning of 2009 it was reported that
subject laid-off some 160 employees due to a sharp decline in orders from
MARRIOTT and ACCOR hotel chains, which were affected from the global economic
crisis. Since then, during 2009 subject received several large orders, main one
from billionaire Sheldon Adelson for his Casinos and hotels in Las Vegas and
Macao, for some NIS 10 million, which enabled to re-recruit back
employees.
In October 2011 it was reported in the local media, that subject
threatens in the dismissals of 550 employees from its manufacturing facilities,
if the Finance Ministry will move on with its program to higher exposure of
competing cheaper import of textile from the Far East, by lifting existing
tariffs.
Sales by local Textile,
Clothing and Fashion Industries have been experiencing decrease in sales over
the last years. The output by the local Textile and Clothing industries in 2009 fell
down by 13% from 2008. Some 60%
of the textile industry production is sold in the local market and the rest for
export.
Most exports were the North American markets (some 50%), and the industries
suffered from the global economic crisis, mainly in the USA, as well as the
slow-down in local market. In 2010 sales for export of the Textile, Clothing
& Leather industries improved just slightly, with 3.5% increase from 2009,
however also due to global markets weakness in 2011 and 2012 fell again by 6.6%
and 6.7%, respectively, reaching US$ 808 million in 2012.
The local industry has been in state
of crisis in face of amounting import from foreign competitors with cheaper
production costs, forcing streamlining process, plants closure, and mostly
resulting in the shift of textile manufacturing to low labor cost countries.
There are around 14,000 employed in the textile sector in some 130 plants. In
order to deal with the situation, the local textile industry diverted mainly to
advanced technologies production, niches and design aspects.
SUMMARY
Good for trade engagements.
Maximum unsecured credit recommended US$ 1,500,000.
NOTES
1. 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).
2. According to the
Registrar of Companies subject has a "Law Violating Company" Status.
As part of the Registrar efforts in the last period to collect fees and
supervision on meeting all duties by Companies’ law, such status notes have
been added to the registry. Registration as a "Law Violating
Company" is done due certain violation by the subject company for not
meeting the Registrar of Companies regulations promptly, mainly for not
paying Registrar fees, and/or not submitting annual reports on time. The
sanctions and penalties against the company in such case include fines up to
NIS 250,000, not allowing the company to register new charges on its favor, not
allow registration a charge on its assets (which may deprive the company from
taking new loans at their banks), cannot make changes in the Registrar, and
more.
It should be noted that this may not necessarily be connected to the
company's business activities and financial standing (although in many cases
there is a connection, it is likely not so in subject's case; It is also
possible that there is a technical or administrative problem, as such things
also happen).
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.62.89 |
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1 |
Rs.101.14 |
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Euro |
1 |
Rs.84.42 |
INFORMATION DETAILS
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Report Prepared
by : |
SDA |
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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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 |
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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 |
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41-55 |
Ba |
Overall
operation is considered normal. Capable to meet normal commitments. |
Satisfactory |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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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 |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NB |
New Business |
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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.