MIRA INFORM REPORT

Report Date :

30.10.2013

IDENTIFICATION DETAILS

Name :	JORDAN PAPER AND CARDBOARD FACTORIES CO LTD

Registered Office :	Military College Road, Zarqa Industrial Area, Aoujan, P O Box 1051 Zarqa 13110

Country :	Jordan

Financials (as on) :	2011

Year of Establishment :	1972

Legal Form :	Limited Liability Company

Line of Business :	Manufacture of cardboard and paper products

No. of Employees :	130

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory

Payment Behaviour :	Slow but correct

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 31^st, 2013

Country Name

Previous Rating

(31.12.2012)

Current Rating

(31.03.2013)

Jordan

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

JORDAN - ECONOMIC OVERVIEW

Jordan's economy is among the smallest in the Middle East, with insufficient supplies of water, oil, and other natural resources, underlying the government's heavy reliance on foreign assistance. Other economic challenges for the government include chronic high rates of poverty, unemployment, inflation, and a large budget deficit. Since assuming the throne in 1999, King ABDALLAH has implemented significant economic reforms, such as opening the trade regime, privatizing state-owned companies, and eliminating some fuel subsidies, which in the last decade spurred economic growth by attracting foreign investment and creating some jobs. The global economic slowdown and regional turmoil, however, have depressed Jordan''s GDP growth, impacting export-oriented sectors, construction, and tourism. In 2011 and 2012, the government approved two economic relief packages and a budgetary supplement, meant to improve the living conditions for the middle and poor classes. Jordan''s finances have also been strained by a series of natural gas pipeline attacks in Egypt, causing Jordan to substitute more expensive diesel imports, primarily from Saudi Arabia, to generate electricity. Jordan is currently exploring nuclear power generation in addition to the exploitation of abundant oil shale reserves and renewable technologies to forestall energy shortfalls. In 2012, to correct budgetary and balance of payments imbalances, Jordan entered into a $2.1 billion, multiple year International Monetary Fund Stand-By Arrangement. Jordan''s financial sector has been relatively isolated from the international financial crisis because of its limited exposure to overseas capital markets. Jordan will continue to depend heavily on foreign assistance to finance the deficit in 2013.

Source : CIA

SUMMARY

Company Name : JORDAN PAPER AND CARDBOARD FACTORIES CO LTD

Country of Origin : Jordan

Legal Form : Limited Liability Company

Registration Date : 1972

Issued Capital : JD 7,500,000

Paid up Capital : JD 7,500,000

Total Workforce : 130

Activities : Manufacture of cardboard and paper products

Financial Condition : Fair

Payments : Nothing detrimental uncovered

Operating Trend : Steady

Person Interviewed : Abdul Hafiz Yahya, Finance Manager

COMPANY NAME

JORDAN PAPER AND CARDBOARD FACTORIES CO LTD

ADDRESS

Registered & Physical Address

Street : Military College Road

Area : Zarqa Industrial Area, Aoujan

PO Box : 1051

Town : Zarqa 13110

Country : Jordan

Telephone : (962-5) 3650412 / 3650411

Facsimile : (962-5) 3650481

Email : jordanpaper@firstnet.com.jo / jopaper@nets.com.jo

Premises

Subject operates from a large suite of offices, a factory and storage facilities that are owned and located in the Industrial Area of Zarqa.

KEY PRINCIPALS

Name Position

· Dr Zayed Raouf Abu Jaber Chairman

· Mones Al Madani Managing Director

· Raed Abu Jaber Director

· Marwn Issa Director

· Nasser Al Dakheel Director

· Mahmoud Shamoor Director

· Mohamed Ali Saleh Director

· Habib Ghawie Director

· Osama Al Alami General Manager

· Hani Saadi Marketing Manager

· Abdul Hafiz Yahya Finance Manager

· Michael Al Faar Production Manager – Paper

· Khalil Al Faar Production Manager – Boxes

LEGAL FORM & OWNERS

Date of Establishment : 1972

Legal Form : Limited Liability Company

Industrial Licence No. : 76

Issued Capital : JD 7,500,000

Paid up Capital : JD 7,500,000

Name of Shareholder (s) Percentage

· Abu Jaber Investment Group 34.161%

Amman

Jordan

· Arab Investment Company 26.668%

Riyadh

Saudi Arabia

· Social Security Fund 10.000%

Amman

Jordan

· Industrial Development Bank -

Amman

Jordan

· Jordanian businessmen and private investors -

Note: Subject was formerly part owned by Jordan Investment Corp (JIC) a government controlled organisation that sold its stake in the subject during mid-2001.

OPERATIONS

Activities: Engaged in the manufacture of cardboard and paper products for the packaging industry.

Major Clients include:

· Al Hekma Jordan

· Dar Al Dawa Jordan

· Adwan Chemicals Jordan

· Arab Pharmaceuticals Jordan

Import Countries: Turkey and the United Kingdom

Operating Trend: Steady

Subject has a workforce of approximately 130 employees.

FINANCIAL DATA

Financial highlights provided by local sources are given below:

Currency: Jordanian Dinars (JD)

Balance Sheet 2011 2010 2009

Cash on Hand & at Banks	49,812	6,907	87,486
Accounts Receivable, Net	2,227,656	1,499,818	1,839,712
Notes Receivable	0	0	0
Post Dated Cheques	554,194	783,901	728,539
Short Term Investments	0	0	0
Inventory	2,375,922	1,904,190	1,861,560
Spare Parts	0	0	0
Total Current Assets	5,640,118	4,392,854	4,735,923
Long Term Investments	0	0	0
Fixed Assets, Net	11,826,104	12,589,904	13,907,987
Lands	134,979	134,979	134,979
Projects in Progress	242,736	19,917	137,321
Total Fixed Assets	12,203,819	12,744,800	14,180,287
Other Assets	194,177	323,335	144,598
Total Assets	18,038,114	17,460,989	19,060,808

Accounts and Notes Payable	1,306,163	1,269,372	862,758
Credit Banks	1,468,460	1,217,671	1,366,133
Short Term Loans	0	0	0
Accrued Part of Long Term Loans	2,956,082	1,743,736	1,112,970
Total Current Liabilities	8,326,060	6,646,530	5,205,662
Long Term Loans & Notes Payable	1,898,887	3,100,610	4,026,580
Corporate Bonds	0	0	0
Other Liabilities	70,424	0	0
Total Liabilities	10,295,371	9,747,140	9,232,242

Authorized Capital	7,500,000	7,500,000	7,500,000
Subscribed Capital	7,500,000	7,500,000	7,500,000
Paid in Capital	7,500,000	7,500,000	7,500,000
Compulsory Reserves	1,252,830	1,237,025	1,237,025
Voluntary Reserve	596,704	596,704	596,704
Other Reserves	0	0	0
Issuance Premium	0	0	0
Issuance Discount	0	0	0
Treasury Stocks	0	0	0
Proposed Cash Dividends	0	0	0
Proposed Stock Dividends	0	0	0
Accumulated Change in Fair Value	0	0	0
Retained Earnings	-1,606,791	-1,619,880	494,837
Total Shareholders’ Equity	7,742,743	7,713,849	9,828,566
Minority Interest	0	0	0
Total Liabilities & Shareholders’ Equity	18,038,114	17,460,989	19,060,808

Income Statement

Operating Revenues	6,457,823	5,392,592	6,181,595
Operating Expenses	5,583,855	5,434,982	5,678,611
Gross Profit	873,968	-42,390	502,984
General and Administrative Expenses	419,153	365,501	368,518
Selling and Distribution Expenses	279,528	288,353	395,370
Depreciation (Period)	0	0	1,500,646
Other Operating Expenses	125,808	153,239	149,890
Net Operating Income	49,479	-849,483	-410,794
Other Revenues	604,172	1,111	238,056
Other Expenses	110,000	1,123,387	192,542
Income Before Interest & Tax	543,651	-1,971,759	-365,280
Interest Expenses	385,599	321,695	342,748
Net Income Before Tax	158,052	-2,293,454	-708,028
Income Tax (Period)	129,158	-178,737	-428
Income Tax (Previous Years)	0	0	0
Universities and Research Train Fees	0	0	0
Board of Directors Remuneration	0	0	0
Net Income	28,894	-2,114,717	-707,600
Minority Interest	0	0	0
Net Income Pertains to Shareholders	28,894	-2,114,717	-707,600

Local sources consider subject’s financial condition to be Fair.

The above financial figures were released by the subject. Please note that figures for 2012 were not available.

BANKERS

· Arab Bank Plc

King Hussein Street

PO Box: 145

Zarqa

Tel: (962-5) 3983381

Fax: (962-5) 3994522

PAYMENT HISTORY

No complaints regarding subject’s payments have been reported.

Date of transaction April 2003

Credit amount 50,000

Amount overdue 0

Payment terms 60 days

Payment Method Letters of Credit

Paying record No Complaints

Currency Euros

GENERAL COMMENTS

Jordan Paper and Cardboard Factories Co Ltd has been trading for over 40 years and is engaged in the manufacture of cardboard and paper products for the packaging industry. It serves a number of well-known clients within Jordan and has a good reputation for the quality of its products.

During the course of this investigation nothing detrimental was uncovered regarding the manner in which payment obligations are fulfilled. The operating history is clear and the financial situation is satisfactory. As such we are of the opinion that the subject is a fair trade risk and the above credit figure is within subject’s financial means.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.46
UK Pound	1	Rs.98.99
Euro	1	Rs.84.72

INFORMATION DETAILS

Report Prepared by :

NIT

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.