MIRA INFORM REPORT

 

 

Report Date :

04.09.2013

 

IDENTIFICATION DETAILS

 

Name :

KLK PREMIER OILS SDN. BHD.

 

 

Formerly Known As :

LELUASA UNTUNG SDN BHD

 

 

Registered Office :

Wisma Taiko, 1, Jalan S.P. Seenivasagam, 30000 Ipoh, Perak,

 

 

Country :

Malaysia.

 

 

Financials (as on) :

30.09.2012

 

 

Date of Incorporation :

28.07.1994

 

 

Com. Reg. No.:

309579-H

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Processing of Palm Kernels and Crude Palm Oil

 

 

No. of Employees :

130 [2013]

 

 

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 :

Good

Payment Behaviour :

Regular

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)

 Malaysia

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

MALAYSIA - ECONOMIC OVERVIEW

 

Malaysia, a middle-income country, has transformed itself since the 1970s from a producer of raw materials into an emerging multi-sector economy. Under current Prime Minister NAJIB, Malaysia is attempting to achieve high-income status by 2020 and to move farther up the value-added production chain by attracting investments in Islamic finance, high technology industries, biotechnology, and services. NAJIB's Economic Transformation Program (ETP) is a series of projects and policy measures intended to accelerate the country's economic growth. The government has also taken steps to liberalize some services sub-sectors. The NAJIB administration also is continuing efforts to boost domestic demand and reduce the economy''s dependence on exports. Nevertheless, exports - particularly of electronics, oil and gas, palm oil and rubber - remain a significant driver of the economy. As an oil and gas exporter, Malaysia has profited from higher world energy prices, although the rising cost of domestic gasoline and diesel fuel, combined with strained government finances, has forced Kuala Lumpur to begin to reduce government subsidies. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplies about 35% of government revenue in 2011. Bank Negera Malaysia (central bank) maintains healthy foreign exchange reserves, and a well-developed regulatory regime has limited Malaysia''s exposure to riskier financial instruments and the global financial crisis. Nevertheless, Malaysia could be vulnerable to a fall in commodity prices or a general slowdown in global economic activity because exports are a major component of GDP. In order to attract increased investment, NAJIB has raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but he has encountered significant opposition, especially from Malay nationalists and other vested interests.

 

Source : CIA

 

 

* Adopted abbreviations :

SC - Subject Company (the company enquired by you)

 

 

N/A - Not Applicable

 

 

EXECUTIVE SUMMARY

 

 

REGISTRATION NO.

:

309579-H

COMPANY NAME

:

KLK PREMIER OILS SDN. BHD.

FORMER NAME

:

LELUASA UNTUNG SDN BHD (10/11/2008)

INCORPORATION DATE

:

28/07/1994

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED (LIMITED BY SHARE)

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

WISMA TAIKO, 1, JALAN S.P. SEENIVASAGAM, 30000 IPOH, PERAK, MALAYSIA.

BUSINESS ADDRESS

:

MDLD 5897, LOT 85, TENGAH NIPAH, JALAN KASTAM BARU, 91100 LAHAD DATU, SABAH, MALAYSIA.

TEL.NO.

:

089-882177

FAX.NO.

:

089-880177

CONTACT PERSON

:

TIANG KON TANG ( GENERAL MANAGER )

 

 

 

INDUSTRY CODE

:

10401

PRINCIPAL ACTIVITY

:

PROCESSING OF PALM KERNELS AND CRUDE PALM OIL

AUTHORISED CAPITAL

:

MYR 30,000,000.00 DIVIDED INTO
ORDINARY SHARE 25,000,000.00 OF MYR 1.00 EACH.
PREFERENCE SHARE 500,000,000.00 OF MYR 0.01 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 20,000,620.00 DIVIDED INTO
ORDINARY SHARES 20,000,000 CASH OF MYR 1.00 EACH.
PREFERENCE SHARES 62,000 CASH OF MYR 0.01 EACH.

 

 

 

SALES

:

MYR 1,872,389,139 [2012]

NET WORTH

:

MYR 173,066,821 [2012]

M1000 OVERALL RANKING

:

277[2011]

M1000 INDUSTRY RANKING

:

10[2011]

 

 

 

STAFF STRENGTH

:

130 [2013]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

FAIR

PAYMENT

:

PROMPT

MANAGEMENT CAPABILITY

:

GOOD

 

 

 

COMMERCIAL RISK

:

LOW

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

GOOD

INDUSTRY OUTLOOK

:

MATURE

 

 

 

 

 

 

 

 

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) processing of palm kernels and crude palm oil.

The SC is not listed on Bursa Malaysia (Malaysia Stock Exchange).

According to the Malaysia 1000 publication, the SC's ranking are as follows:

 

 

 

 

YEAR

2011

 

 

OVERALL RANKING

277

 

 

INDUSTRY RANKING

10

 

 

 

The immediate holding company of the SC is KUALA LUMPUR KEPONG BERHAD, a company incorporated in MALAYSIA.

The major shareholder(s) of the SC are shown as follows :

 

Name

Address

IC/PP/Loc No

Shareholding

(%)

KUALA LUMPUR KEPONG BERHAD

WISMA TAIKO, NO.1,JALAN S.P. SEENIVASAGAM, 30000 IPOH, PERAK, MALAYSIA.

15043V

17,052,700.00

85.00

MITSUBISHI CORPORATION

2-3-1 MARUNOUCHI CHIYODA-KU, TOKYO 100-8086 JAPAN, FOREIGN, JAPAN.

XLZ00212218

3,009,300.00

15.00

 

 

 

---------------

------

 

 

 

20,062,000.00

100.00

 

 

 

============

=====

+ Also Director

 

The SC interest in other companies (Subsidiaries/Associates) are shown as follow :

 

Local No

Country

Company

(%)

As At

51360W

MALAYSIA

GOLDEN YIELD SDN. BHD.

100.00

01/04/2013

 

 

 

 

 

 

DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. TIANG KON TANG

Address

:

LOT 20, MDLD 593, TAMAN EXECUTIVE, JALAN TENGAH NIPAH, 91100 LAHAD DATU, SABAH, MALAYSIA.

 

 

 

New IC No

:

610319-08-5797

Date of Birth

:

19/03/1961

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

22/11/2012

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 2

 

Name Of Subject

:

MS. KHOO SAW LOOI

Address

:

11, PERSIARAN GOPENG 9, TAMAN GOLF, 31350 IPOH, PERAK, MALAYSIA.

 

 

 

New IC No

:

590830-05-5004

Date of Birth

:

30/08/1959

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

22/11/2012

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 3

 

Name Of Subject

:

MR. LEONG SEAN MENG

Address

:

9, HALA BANDAR BARU TAMBUN 17, DESA TAMBUN INDAH, 31400 IPOH, PERAK, MALAYSIA.

 

 

 

New IC No

:

581219-08-5319

Date of Birth

:

19/12/1958

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

11/07/2011

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 4

 

Name Of Subject

:

YUJI YAMAGUCHI

Address

:

20-8-E, AZAMINO 3-CHOME, AOBA-KU YOKOHAMA, KANAGAWA, 225-0011, JAPAN.

IC / PP No

:

TZ0403792

 

 

 

 

 

 

 

 

 

Nationality

:

JAPANESE

Date of Appointment

:

27/09/2011

 

 

 

 

 

 

 

 

 

 

 

 



MANAGEMENT

 

 

 

1)

Name of Subject

:

CHOY MING HAW

 

Position

:

ACCOUNTANT

 

 

 

 

 

2)

Name of Subject

:

TIANG KON TANG

 

Position

:

GENERAL MANAGER

 

 

 

 

 

 

AUDITOR

 

Auditor

:

KPMG

Auditor' Address

:

WISMA GEK POH, JALAN DUNLOP, 2ND FLOOR, 91000 TAWAU, SABAH, MALAYSIA.

 

 

 

 

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. YAP MIOW KIEN

 

IC / PP No

:

A1171235

 

New IC No

:

681220-05-5334

 

Address

:

12, LINGKARAN MERU VALLEY 1A, LAKEVIEW VILLA, MERU VALLEY GOLF RESORT, JALAN BUKIT MERU, 30020 IPOH, PERAK, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

2)

Company Secretary

:

MR. LAU YONG HOOI

 

 

 

 

 

New IC No

:

560605-08-5963

 

Address

:

3293, TAMAN MAJU JAYA, JALAN CHONG THIEN VUN, 91000 TAWAU, SABAH, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

 

 

 

 

 

 

 

 

 

 

 

ENCUMBRANCE (S)


No encumbrance was found in our databank at the time of investigation.

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

Overseas

:

YES

 

 

 



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

[

X

]

 

Good 31-60 Days

[

 

]

 

Average 61-90 Days

[

 

]

 

Fair 91-120 Days

[

 

]

 

Poor >120 Days

[

 

]

 

 

 

 

 

 

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

 

 

 

Export Market

:

ASIA

EUROPE

Credit Term

:

30 - 60 DAYS

 

 

 

 

 

 

Payment Mode

:

CHEQUES
TELEGRAPHIC TRANSFER (TT)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Products manufactured

:

PALM KERNELS AND CRUDE PALM OIL

 

 

 

Ownership of premises

:

OWNED

 

 

Total Number of Employees:

 

YEAR

2013

2011

2010

 

GROUP

N/A

N/A

N/A

 

 

 

 

 

 

COMPANY

130

130

130

 

 

 

 

 

 

 

Branch

:

NO

 

Other Information:


The SC is principally engaged in the (as a / as an) processing of palm kernels and crude palm oil.

The SC is the related company of KUALA LUMPUR KEPONG BERHAD ("KLK"), is a Malaysian multinational company involved in plantation, manufacturing, property development and retailing.

The SC undertakes the following business operations:

1) Kernel crushing

2) Manufacturing of crude palm oil


CURRENT INVESTIGATION

Latest fresh investigations carried out on the SC indicated that :

Telephone Number Provided By Client

:

605 2417844

Current Telephone Number

:

089-882177

Match

:

NO

 

 

 

Address Provided by Client

:

WISMA TAIKO,NO.1 JALAN S.P. SEENIVASAGAM,30000 IPOHO-PERAK MALAYSIA

Current Address

:

MDLD 5897, LOT 85, TENGAH NIPAH, JALAN KASTAM BARU, 91100 LAHAD DATU, SABAH, MALAYSIA.

Match

:

NO

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations


On 27th August 2013 we contacted one of the staff from the SC and she provided some information on the SC.

The address provided belongs to the SC's registered office.

FINANCIAL ANALYSIS

 

 

Profitability

 

 

 

 

 

 

Turnover

:

Erratic

[

2008 - 2012

]

 

Profit/(Loss) Before Tax

:

Decreased

[

2008 - 2012

]

 

Return on Shareholder Funds

:

Acceptable

[

13.72%

]

 

Return on Net Assets

:

Acceptable

[

19.19%

]

 

 

 

 

 

 

 

 

The fluctuating turnover reflects the fierce competition among the existing and new market players.The management had succeeded in turning the SC into a profit making company. The profit could be due to better control of its operating costs and efficiency in utilising its resources. The SC's management had generated acceptable return for its shareholders using its assets.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Favourable

[

17 Days

]

 

Debtor Ratio

:

Favourable

[

31 Days

]

 

Creditors Ratio

:

Favourable

[

8 Days

]

 

 

 

 

 

 

 

 

The SC's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. The favourable debtors' days could be due to the good credit control measures implemented by the SC. The SC had a favourable creditors' ratio where the SC could be taking advantage of the cash discounts and also wanting to maintain goodwill with its creditors.

 

 

 

 

 

 

 

Liquidity

 

 

 

 

 

 

Liquid Ratio

:

Favourable

[

1.23 Times

]

 

Current Ratio

:

Unfavourable

[

1.83 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

:

Favourable

[

11.70 Times

]

 

Gearing Ratio

:

Favourable

[

0.03 Times

]

 

 

 

 

 

 

 

 

The interest cover showed that the SC was able to service the interest. The favourable interest cover could indicate that the SC was making enough profit to pay for the interest accrued. The SC was lowly geared thus it had a low financial risk. The SC was mainly financed by its shareholders' funds and internally generated funds. In times of economic slowdown / downturn, the SC being a lowly geared company, will be able to compete better than those companies which are highly geared in the same industry.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall Assessment :

 

 

 

 

 

 

The SC's turnover showed a volatile trend but its losses were lower when compared to the previous corresponding period. This could suggest that the SC was more efficient in its operating cost control and was more competitive. 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. With the favourable interest cover, the SC could be able to service all the accrued interest without facing any difficulties. The SC as a lowly geared company, will be more secured compared to those highly geared companies. It has the ability to meet all its long term obligations.

 

 

 

 

 

 

 

Overall financial condition of the SC : FAIR

 

 

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

10401 : Manufacture of crude palm oil

 

 

INDUSTRY :

PALM OIL

 

 

 

Oil palm is one of the main drivers of Malaysia's agriculture sector where it has accounting for 71% of its agricultural land bank. Malaysia is the one of the biggest producers and exporters of palm oil prodcuts in the growing global need for oils and fats. The palm oil industry is expected to grow about 7.1% over the next 10 years where it is driven by new plantation expansion, venture of large plantation companies into high potential downstream activities such as processed food, biodiesel, second generation biofuel and oleochemicals. Malaysia currently accounts for 39 % of world palm oil production and 44% of world exports. Taken into account of other oils & fats produced in the country, Malaysia accounts for 12% and 27% of the world's total production and exports of oils and fats. Being one of the biggest producers and exporters of palm oil and palm oil products, Malaysia has an important role to play in fulfilling the growing global need for oils and fats sustainably.

 

In year 2013, the production of crude palm oil is envisaged to rebound 2.5% to 18.9 million tonnes on account of expanded matured areas to 4.44 million hectares. However Malaysian palm oil’s supply and demand for February 2013 with palm oil stocks continued to be lower for the consecutive two months at 2.444 million tonnes, a decrease of 5.23% from January 2013 and was slightly above the average estimation at 2.42 million tonnes. The exports in February 2013 fell 13.98% to 1.398 million tonnes while the palm oil production reduced 19.15% to 1.296 million tonnes. The palm oil production would be expected to be in dismal as the oil palm had entered a low yield cycle currently.

 

According to the 2013 Budget, the palm oil sector contracted 8.6% during the first half of the year 2012 due to the less favourable weather conditions and natural production down cycle that constrained the output of fresh fruit bunches. However, the yield is expected to improve in the later part of the year, with the subsector registering a smaller contraction of 2.8% in 2012. Total planted areas of oil palm increased substantially by 77,106 hectares to five million hectares as at end-June 2012. Of the total planted areas, 28.4% or 1.5 million hectares are located in Sabah. With the acceleration of planting activity, total planted areas are expected to increase to 5.1 million hectares in 2012.

 

According to the Performance Management and Delivery Unit (Pemandu), the Palm Oil National Key Economic Area (NKEA), Malaysia's most important commodity is expected to contribute from RM125 billion to RM178 billion to the Gross National Income (GNI) and create about 41,600 jobs by 2020, with the government's focus on eight Entry Point Projects (EPPs). As part of the government's efforts to accelerate the country's replanting and new planting programme and manage stock levels, the government has allocated an additional RM432 million as funds for independent smallholders' replanting and new planting initiatives in 2013. According to Pemandu, the government will also accelerate the replanting of oil palm by plantations and smallholders as well as new planting by independent smallholders to 130,000 ha. and raise the area complying with best practices by an additional 200,000 ha. in 2013.

 

However, the future performance of the industry is unpredictable as with many factors that can give impact to the industry is still unknown. Nationally, the sentiments seem positive, internation­ally there are mixed signals but with the current growth rate, an expected increase in demand, a recovering glo­bal economy, analysts and industry sources are reckoning that the bull may be able to hold the bear back.

 

Under the palm oil National Key Economic Areas (NKEAs) in 2011, the launches of the Oil Palm Replanting and New Planting Smallholders Schemes ware improved the smallholders agricultural practices in 2012.The oil extraction rate is set to improve to 21.05% in three-year from 2012 to low of 19.70% as 1.35 more.

 

In driving speedier harvesting of oil palm fruits, the government has introduced the RM1,000 discount scheme to encourage the use of motorised sickle called Cantas and diamond blade sharpeners to enhance the palm oil industry. MPOB appointed 100 enforcement officers to visit mills to ensure the only good quality crops are processed. Since 2007, the palm oil industry has grown at an average of 14.5 per cent annualy until 2012. If the momentum is maitained for next 5 to 8 years, malaysia will achive its target of two million of hecters palm oil.

 

 

OVERALL INDUSTRY OUTLOOK : Mature

 

CREDIT RISK EVALUATION & RECOMMENDATION

 


Incorporated in 1994, the SC is a Private Limited company, focusing on processing of palm kernels and crude palm oil. With its long establishment in the market, the SC has received strong support from its stable customers base. Its business position in the market is quite stable and it is expected to enjoy better market shares over its rivals. The SC is well backed by a listed company shareholders which would stimulate further growth for the SC. Hence, the potential growth of the SC is positive. The SC is a large entity with strong capital position. We are confident with the SC's business and its future growth prospect.

Over the years, the SC has penetrated into both the local and overseas market. The SC has positioned itself in the global market and is competing in the industry. Its stable clientele base will enable the SC to further enhance its business in the near term. The SC is a fairly large and rapidly growing company with over 130 staff in its operations. Overall, we regard that the SC's management capability is good.

Despite the lower turnover, the SC's pre-tax profit have increased compared to the previous year. The higher profit could be due to better control of its operating costs and efficiency in utilising its resources. 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. Being a lowly geared company, the SC is exposed to low financial risk as it is mainly dependent on its internal funds to finance its business needs. Given a positive net worth standing at MYR 173,066,821, the SC should be able to maintain its business in the near terms.

Having a strong assets backing, the SC possesses latent assets as collateral for further financial extension. Hence, it has good chance of getting loans if the needs arises. 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. Overall the SC has a good control over its resources.

We regard that the SC's overall payment habit is prompt. The SC had a favourable creditors' ratio as evidenced by its favourable collection days.

The industry has reached its optimum level and is generally stable. It is saturated and very competitive. However, with the SC's favourable conditions, it should have acquired competitive edge from its competitors.

Based on the above condition, we recommend credit be granted to the SC promptly.

 



PROFIT AND LOSS ACCOUNT

 

 

THE FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIAN FINANCIAL REPORTING STANDARDS(FRS)

KLK PREMIER OILS SDN. BHD.

 

Financial Year End

2012-09-30

2011-09-30

2010-09-30

2009-09-30

2008-09-30

Months

12

12

12

12

12

Consolidated Account

Company

Company

Company

Company

Company

Audited Account

YES

YES

YES

YES

YES

Unqualified Auditor's Report (Clean Opinion)

YES

YES

YES

YES

YES

Financial Type

FULL

FULL

FULL

FULL

FULL

Currency

MYR

MYR

MYR

MYR

MYR

 

 

 

 

 

 

TURNOVER

1,872,389,139

2,169,233,320

1,406,025,299

1,337,656,533

1,615,954,279

 

----------------

----------------

----------------

----------------

----------------

Total Turnover

1,872,389,139

2,169,233,320

1,406,025,299

1,337,656,533

1,615,954,279

Costs of Goods Sold

<1,805,364,962>

<2,116,305,715>

<1,355,501,918>

-

-

 

----------------

----------------

----------------

----------------

----------------

Gross Profit

67,024,177

52,927,605

50,523,381

-

-

 

----------------

----------------

----------------

----------------

----------------

 

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

31,279,719

<12,562,270>

22,474,042

20,335,570

32,178,429

 

----------------

----------------

----------------

----------------

----------------

PROFIT/(LOSS) BEFORE TAXATION

31,279,719

<12,562,270>

22,474,042

20,335,570

32,178,429

Taxation

<7,535,182>

7,167,174

<17,793>

<2,700,433>

<7,146,431>

 

----------------

----------------

----------------

----------------

----------------

PROFIT/(LOSS) AFTER TAXATION

23,744,537

<5,395,096>

22,456,249

17,635,137

25,031,998

 

----------------

----------------

----------------

----------------

----------------

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

 

As previously reported

59,321,984

62,437,398

39,981,349

22,346,212

<2,685,786>

Prior year adjustment

-

2,279,782

-

-

-

 

----------------

----------------

----------------

----------------

----------------

As restated

59,321,984

64,717,180

39,981,349

22,346,212

<2,685,786>

 

----------------

----------------

----------------

----------------

----------------

PROFIT AVAILABLE FOR APPROPRIATIONS

83,066,521

59,322,084

62,437,598

39,981,349

22,346,212

TRANSFER TO RESERVES - General

-

<100>

<200>

-

-

 

----------------

----------------

----------------

----------------

----------------

RETAINED PROFIT/(LOSS) CARRIED FORWARD

83,066,521

59,321,984

62,437,398

39,981,349

22,346,212

 

=============

=============

=============

=============

=============

 

 

 

 

 

 

INTEREST EXPENSE (as per notes to P&L)

 

 

 

 

 

Others

2,922,693

3,615,320

957,309

2,210,060

-

 

----------------

----------------

----------------

----------------

 

 

2,922,693

3,615,320

957,309

2,210,060

 

 

 

BALANCE SHEET

 

 

KLK PREMIER OILS SDN. BHD.

 

ASSETS EMPLOYED:

 

 

 

 

 

FIXED ASSETS

51,147,680

59,662,851

66,419,951

68,785,686

77,146,604

 

 

 

 

 

 

LONG TERM INVESTMENTS/OTHER ASSETS

 

 

 

 

 

Subsidiary companies

1,292,443

-

-

-

-

Deferred assets

-

2,261,470

-

-

-

Others

3,936,661

4,008,721

4,080,783

6,520,145

6,594,748

 

----------------

----------------

----------------

----------------

----------------

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

5,229,104

6,270,191

4,080,783

6,520,145

6,594,748

 

 

 

 

 

 

 

----------------

----------------

----------------

----------------

----------------

TOTAL LONG TERM ASSETS

56,376,784

65,933,042

70,500,734

75,305,831

83,741,352

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

Stocks

87,569,164

124,812,012

124,564,367

77,996,199

133,290,199

Trade debtors

160,637,435

120,293,977

50,137,772

89,571,500

43,483,710

Other debtors, deposits & prepayments

2,900,188

12,262,099

4,361,033

6,831,564

3,939,855

Short term deposits

-

-

-

2,500,000

6,700,000

Deposits with financial institutions

3,100,000

17,700,000

2,300,000

-

-

Amount due from holding company

-

-

3,634

-

-

Amount due from subsidiary companies

71,777

-

-

-

-

Amount due from related companies

-

6,625,188

-

-

-

Cash & bank balances

6,835,659

716,430

1,198,841

807,306

6,838,474

Others

7,733,451

-

-

-

-

 

----------------

----------------

----------------

----------------

----------------

TOTAL CURRENT ASSETS

268,847,674

282,409,706

182,565,647

177,706,569

194,252,238

 

----------------

----------------

----------------

----------------

----------------

TOTAL ASSET

325,224,458

348,342,748

253,066,381

253,012,400

277,993,590

 

=============

=============

=============

=============

=============

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Trade creditors

40,481,869

24,630,123

26,328,593

20,131,346

41,328,839

Other creditors & accruals

5,060,608

4,174,060

3,149,724

3,298,013

5,327,413

Other borrowings

5,000,000

-

-

-

-

Bill & acceptances payable

74,000,000

99,000,000

-

55,000,000

-

Other liabilities & accruals

-

30,563,885

-

-

-

Amounts owing to holding company

546,503

1,636,861

-

54,458

-

Amounts owing to related companies

21,904,633

39,001,241

30,127,248

9,509,620

100,364,475

Provision for taxation

-

14,294

37,308

13,651

51,271

Other liabilities

-

-

26,000,000

-

-

 

----------------

----------------

----------------

----------------

----------------

TOTAL CURRENT LIABILITIES

146,993,613

199,020,464

85,642,873

88,007,088

147,071,998

 

----------------

----------------

----------------

----------------

----------------

NET CURRENT ASSETS/(LIABILITIES)

121,854,061

83,389,242

96,922,774

89,699,481

47,180,240

 

----------------

----------------

----------------

----------------

----------------

TOTAL NET ASSETS

178,230,845

149,322,284

167,423,508

165,005,312

130,921,592

 

=============

=============

=============

=============

=============

 

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

 

Ordinary share capital

20,000,700

20,000,700

20,000,800

20,001,000

20,000,000

 

----------------

----------------

----------------

----------------

----------------

TOTAL SHARE CAPITAL

20,000,700

20,000,700

20,000,800

20,001,000

20,000,000

 

 

 

 

 

 

RESERVES

 

 

 

 

 

Share premium

69,999,300

69,999,300

79,999,200

99,999,000

-

Retained profit/(loss) carried forward

83,066,521

59,321,984

62,437,398

39,981,349

22,346,212

Capital redemption reserve

300

300

200

-

-

 

----------------

----------------

----------------

----------------

----------------

TOTAL RESERVES

153,066,121

129,321,584

142,436,798

139,980,349

22,346,212

 

 

 

 

 

 

 

----------------

----------------

----------------

----------------

----------------

SHAREHOLDERS' FUNDS/EQUITY

173,066,821

149,322,284

162,437,598

159,981,349

42,346,212

 

 

 

 

 

 

LONG TERM LIABILITIES

 

 

 

 

 

Deferred taxation

5,164,024

-

4,985,910

5,023,963

2,373,470

Others

-

-

-

-

86,201,910

 

----------------

----------------

----------------

----------------

----------------

TOTAL LONG TERM LIABILITIES

5,164,024

-

4,985,910

5,023,963

88,575,380

 

----------------

----------------

----------------

----------------

----------------

 

178,230,845

149,322,284

167,423,508

165,005,312

130,921,592

 

=============

=============

=============

=============

=============

 

 

FINANCIAL RATIO

 

 

KLK PREMIER OILS SDN. BHD.

 

TYPES OF FUNDS

 

 

 

 

 

Cash

6,835,659

716,430

1,198,841

3,307,306

13,538,474

Net Liquid Funds

6,835,659

716,430

1,198,841

3,307,306

13,538,474

Net Liquid Assets

34,284,897

<41,422,770>

<27,641,593>

11,703,282

<86,109,959>

Net Current Assets/(Liabilities)

121,854,061

83,389,242

96,922,774

89,699,481

47,180,240

Net Tangible Assets

178,230,845

149,322,284

167,423,508

165,005,312

130,921,592

Net Monetary Assets

29,120,873

<41,422,770>

<32,627,503>

6,679,319

<174,685,339>

BALANCE SHEET ITEMS

 

 

 

 

 

Total Borrowings

5,000,000

0

0

0

0

Total Liabilities

152,157,637

199,020,464

90,628,783

93,031,051

235,647,378

Total Assets

325,224,458

348,342,748

253,066,381

253,012,400

277,993,590

Net Assets

178,230,845

149,322,284

167,423,508

165,005,312

130,921,592

Net Assets Backing

173,066,821

149,322,284

162,437,598

159,981,349

42,346,212

Shareholders' Funds

173,066,821

149,322,284

162,437,598

159,981,349

42,346,212

Total Share Capital

20,000,700

20,000,700

20,000,800

20,001,000

20,000,000

Total Reserves

153,066,121

129,321,584

142,436,798

139,980,349

22,346,212

LIQUIDITY (Times)

 

 

 

 

 

Cash Ratio

0.05

0.00

0.01

0.04

0.09

Liquid Ratio

1.23

0.79

0.68

1.13

0.41

Current Ratio

1.83

1.42

2.13

2.02

1.32

WORKING CAPITAL CONTROL (Days)

 

 

 

 

 

Stock Ratio

17

21

32

21

30

Debtors Ratio

31

20

13

24

10

Creditors Ratio

8

4

7

5

9

SOLVENCY RATIOS (Times)

 

 

 

 

 

Gearing Ratio

0.03

0.00

0.00

0.00

0.00

Liabilities Ratio

0.88

1.33

0.56

0.58

5.56

Times Interest Earned Ratio

11.70

<2.47>

24.48

10.20

0.00

Assets Backing Ratio

8.91

7.47

8.37

8.25

6.55

PERFORMANCE RATIO (%)

 

 

 

 

 

Operating Profit Margin

1.67

<0.58>

1.60

1.52

1.99

Net Profit Margin

1.27

<0.25>

1.60

1.32

1.55

Return On Net Assets

19.19

<5.99>

14.00

13.66

24.58

Return On Capital Employed

19.19

<5.99>

14.00

13.66

24.58

Return On Shareholders' Funds/Equity

13.72

<3.61>

13.82

11.02

59.11

Dividend Pay Out Ratio (Times)

0.00

0.00

0.00

0.00

0.00

NOTES TO ACCOUNTS

 

 

 

 

 

Contingent Liabilities

0

0

0

0

0



 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.66.88

UK Pound

1

Rs.103.94

Euro

1

Rs.88.09

 

INFORMATION DETAILS

 

Report Prepared by :

NLM

 

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.