MIRA INFORM REPORT

 

 

Report Date :

26.08.2014

 

IDENTIFICATION DETAILS

 

Name :

MFE FORMWORK TECHNOLOGY SDN. BHD.

 

 

Formerly Known as :

MIVAN FAR EAST SDN BHD

 

 

Registered Office :

Lot 824, Komplek Sun, Jalan Bukit Bintang, Tingkat 8, 55100 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2012

 

 

Date of Incorporation :

05.09.1990

 

 

Com. Reg. No.:

203754-U

 

 

Legal Form :

Private Limited Company

 

 

Line of Business :

·         Subject is a revolutionary aluminum formwork construction system

Engaged in manufacturing of formwork system for civil engineering

Engaged in manufacturing of industrial frameworks in metal

 

 

No of Employees :

600 [2014]

 

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 – June 01, 2014

 

Country Name

Previous Rating

(31.03.2014)

Current Rating

(01.06.2014)

Malaysia

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low Risk

 

A2

Moderate Low Risk

 

B1

Moderate Risk

 

B2

Moderate High Risk

 

C1

High Risk

 

C2

Very High Risk

 

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.

:

203754-U

COMPANY NAME

:

MFE FORMWORK TECHNOLOGY SDN. BHD.

FORMER NAME

:

MIVAN FAR EAST SDN BHD (03/12/2007)
SPIRE FAR EAST SDN BHD (12/03/1992)

INCORPORATION DATE

:

05/09/1990

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

LOT 824, KOMPLEK SUN, JALAN BUKIT BINTANG, TINGKAT 8, 55100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

NO 501, 4TH FLOOR, BLOCK B, GLOMAC BUSINESS CENTRE, 10 JALAN SS 6/1, KELANA JAYA,, 47301 PETALING JAYA, SELANGOR, MALAYSIA.

TEL.NO.

:

03-78032806

FAX.NO.

:

03-78033437

WEB SITE

:

WWW.MFEFORMWORK.COM

CONTACT PERSON

:

JAMES ROBINSON ( MANAGING DIRECTOR )

 

 

 

INDUSTRY CODE

:

25111 25111

PRINCIPAL ACTIVITY

:

·         Subject is a revolutionary aluminum formwork construction system

Engaged in manufacturing of formwork system for civil engineering

Engaged in manufacturing of industrial frameworks in metal

AUTHORISED CAPITAL

:

MYR 11,000,000.00 DIVIDED INTO 
ORDINARY SHARE 10,000,000.00 OF MYR 1.00 EACH.
PREFERENCE SHARE 1,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 1,000,000.00 DIVIDED INTO 
ORDINARY SHARES 1,000,000 CASH OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 144,850,455 [2012]

NET WORTH

:

MYR 19,992,974 [2012]

 

 

 

STAFF STRENGTH

:

600 [2014]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

STABLE

PAYMENT

:

AVERAGE

MANAGEMENT CAPABILITY

:

GOOD

 

 

 

COMMERCIAL RISK

:

LOW

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

GOOD

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

 

HISTORY / BACKGROUND

 

The Subject 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 Subject must have at least two directors. A private limited company is a separate legal entity from its shareholders. As a separate legal entity, the Subject 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 Subject is insolvent. The Subject 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 Subject is principally engaged in the (as a / as an) manufacturing of formwork system for civil engineering construction.

 

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

                                 

The immediate holding company of the Subject is MFE SYSTEM FORMWORK TECHNOLOGY LIMITED, a company incorporated in VIRGIN ISLANDS, BRITISH.

 

The ultimate holding company of the Subject is MFE HOLDINGS LIMITED, a company incorporated in VIRGIN ISLANDS, BRITISH.

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

11/06/2012

MYR 11,000,000.00

MYR 1,000,000.00

30/01/1991

MYR 10,000,000.00

MYR 1,000,000.00

06/09/1990

MYR 10,000,000.00

MYR 2.00

 

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

Name

Address

IC/PP/Loc No

Shareholding

(%)

MFE SYSTEM FORMWORK TECHNOLOGY LIMITED

C/O 171, MAIN STREET ROAD, TOWN TORTOLA, VGI 110, VIRGIN ISLANDS, BRITISH.

XLZ00215698

1,000,000.00

100.00

 

 

 

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

------

 

 

 

1,000,000.00

100.00

 

 

 

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

=====

+ Also Director

 

DIRECTORS

 

DIRECTOR 1

Name Of Subject

:

PATRICK GERARD GORHAM

Address

:

B27-2, KIARAMAS SUTERA CONDOMINIUM, 7, JALAN DESA KIARA, BUKIT KIARA, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

LT0009566

 

 

 

 

 

 

 

 

 

Nationality

:

IRISH

Date of Appointment

:

09/06/2010

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 2

Name Of Subject

:

JASON ALEKSANDER KARDACHI

Address

:

162, WATTEN ESTATE ROAD, 287611, SINGAPORE.

IC / PP No

:

E4035148

 

 

 

 

 

 

 

 

 

Nationality

:

AUSTRALIAN

Date of Appointment

:

23/08/2011

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 3

Name Of Subject

:

JAMES ROBINSON

Address

:

A-19-5, MONT KIARA AMAN, 4, JALAN KIARA 2, MONT KIARA, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

761327682

 

 

 

 

 

 

 

 

 

Nationality

:

BRITISH

Date of Appointment

:

28/09/2009

 

 

 

 

 

 

 

 

 

 

 

 



MANAGEMENT

 

 

 

1)

Name of Subject

:

JAMES ROBINSON

 

Position

:

MANAGING DIRECTOR

 

 

 

 

 

2)

Name of Subject

:

ELAINE LAI

 

Position

:

HUMAN RESOURCE MANAGER

 

 

 

 

 

3)

Name of Subject

:

JAMES TEO

 

Position

:

OPERATIONS MANAGER

 

 

 

AUDITOR

 

Auditor

:

KPMG

Auditor' Address

:

KPMG TOWER, 8, FIRST AVENUE, BANDAR UTAMA, 47800 PETALING JAYA, SELANGOR, MALAYSIA.

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. LAI SOOK HEAN

 

IC / PP No

:

A1854741

 

New IC No

:

710503-08-6122

 

Address

:

164, JELAPANG N/V, 30020 IPOH, PERAK, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

2)

Company Secretary

:

MR. TAN BENG HOCK

 

IC / PP No

:

4086144

 

New IC No

:

361028-07-5295

 

Address

:

80, JALAN USJ 6/2B, SUBANG JAYA, 46100 PETALING JAYA, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

 

 

 

 

 

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

2

29/10/1992

N/A

THE PACIFIC ABNK BHD

MYR 1,000,000.00

Satisfied

1

04/11/1992

N/A

PUBLIC INVESTMENT BANK BERHAD

-

Satisfied

3

26/12/1992

N/A

THE PACIFIC BANK BHD

MYR 1,000,000.00

Satisfied

4

16/06/1993

N/A

THE PACIFIC BANK BERHAD

MYR 1,000,000.00

Satisfied

5

07/07/1995

N/A

NATIONAL AUSTRALIA MERCHANT BANK SINGAPORELTD

-

Satisfied

6

06/07/1999

N/A

MALAYAN BANKING BERHAD

MYR 1,200,000.00

Satisfied

7

01/11/2007

DEBENTURE

ABN AMRO BANK N.V. LABUAN BRANCH

MYR 5,000,000.00

Satisfied

8

08/06/2012

DEBENTURE

THE ROYAL BANK OF SCOTLAND BERHAD

MYR 8,300,000.00

Unsatisfied

9

08/06/2012

DEBENTURE

THE ROYAL BANK OF SCOTLAND, PLC, LABUAN BRANCH

USD 5,000,000.00

Unsatisfied

10

08/06/2012

DEBENTURE

PATRICK GERARD GORHAM

JAMES ROBINSON

USD 300,000.00

Unsatisfied

 

LEGAL CHECK AGAINST SUBJECT


* A check has been conducted in our databank against the Subject 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 SUBJECT


* We have checked through the Subject 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 Subject 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

[

 

]

 

Good 31-60 Days

[

 

]

 

Average 61-90 Days

[

X

]

 

Fair 91-120 Days

[

 

]

 

Poor >120 Days

[

 

]

 

 

 

 

 

 

 

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

 

 

 

Export Market

:

HONG KONG

INDIA

MIDDLE EAST

CHINA

Credit Term

:

AS AGREED

 

 

 

 

 

 

Payment Mode

:

TELEGRAPHIC TRANSFER (TT)
LETTER OF CREDIT (LC)
CHEQUES

Type of Customer

:

CONSTRUCTION INDUSTRY

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Products manufactured

:

FORMWORK SYSTEM FOR CONSTRUCTION

 

 

 

Ownership of premises

:

OWNED

 

Factory / Premises

:

AL 121, BATU 13, JALAN SUBANG, 47000 SUNGAI BULOH, SELANGOR, MALAYSIA. 
Tel No: 03-61560901 
Fax No: 03-61560952

 

 

 

 

 

Total Number of Employees:

 

YEAR

2014

2013

2012

2011

2010

2009

 

 

 

 

GROUP

N/A

N/A

N/A

N/A

N/A

N/A

 

 

 

COMPANY

600

600

650

650

625

615

 

 

 

 

Branch

:

NO

 

 

Other Information:

The Subject is principally engaged in the (as a / as an) manufacturing of formwork system for civil engineering construction. 

MFE Formwork Technology is a revolutionary aluminum formwork construction system.

The Subject has many experiences for forming cast in place reinforced concrete building structures. Using this unique system, all walls, floor slabs, columns, beams, stairs, balconies, together with door and window openings are cast in place in a single site based operation.

 

CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

03-78032806

Match

:

N/A

 

 

 

Address Provided by Client

:

NO 501, 4TH FLOOR, BLOCK B, GLOMAC BUSINESS CENTRE, 10 JALAN SS 6/1, KELANA JAYA,,47301,PETALING JAYA,SELANGOR.

Current Address

:

NO 501, 4TH FLOOR, BLOCK B, GLOMAC BUSINESS CENTRE, 10 JALAN SS 6/1, KELANA JAYA,, 47301 PETALING JAYA, SELANGOR, MALAYSIA.

Match

:

YES

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations

we contacted one of the staff from the Subject and she provided some information.

FINANCIAL ANALYSIS

 

 

Profitability

 

 

 

 

 

 

Turnover

:

Erratic

[

2008 - 2012

]

 

Profit/(Loss) Before Tax

:

Decreased

[

2008 - 2012

]

 

Return on Shareholder Funds

:

Favourable

[

37.70%

]

 

Return on Net Assets

:

Favourable

[

30.36%

]

 

 

 

 

 

 

 

 

The fluctuating turnover reflects the fierce competition among the existing and new market players.The Subject's profit fell sharply because of the high operating costs incurred. Generally the Subject was profitable. The favourable return on shareholders' funds and return on net assets indicate that the Subject's management was efficient in utilising the assets to generate returns.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Favourable

[

49 Days

]

 

Debtor Ratio

:

Unfavourable

[

114 Days

]

 

Creditors Ratio

:

Unfavourable

[

76 Days

]

 

 

 

 

 

 

 

 

The Subject's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. The Subject's debtors ratio was high. The Subject should tighten its credit control and improve its collection period. The unfavourable creditors' ratio could be due to the Subject taking advantage of the credit granted by its suppliers. However this may affect the goodwill between the Subject and its suppliers and the Subject may inadvertently have to pay more for its future supplies.

 

 

 

 

 

 

 

Liquidity

 

 

 

 

 

 

Liquid Ratio

:

Favourable

[

1.06 Times

]

 

Current Ratio

:

Unfavourable

[

1.42 Times

]

 

 

 

 

 

 

 

 

A minimum liquid ratio of 1 should be maintained by the Subject in order to assure its creditors of its ability to meet short term obligations and the Subject was in a good liquidity position. Thus, we believe the Subject is able to meet all its short term obligations as and when they fall due.

 

 

 

 

 

 

 

Solvency

 

 

 

 

 

 

Interest Cover

:

Favourable

[

12.04 Times

]

 

Gearing Ratio

:

Unfavourable

[

1.29 Times

]

 

 

 

 

 

 

 

 

The interest cover showed that the Subject was able to service the interest. The favourable interest cover could indicate that the Subject was making enough profit to pay for the interest accrued. The Subject was highly geared, thus it had a high financial risk. The Subject was dependent on loans to finance its business needs. In times of economic downturn and / or high interest rate, the Subject will become less profitable and competitive than other firms in the same industry, which are lowly geared. This is because the Subject has to service the interest and to repay the loan, which will erode part of its profits. The profits will fluctuate depending on the Subject's turnover and the interest it needs to pay.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall Assessment :

 

 

 

 

 

 

The Subject recorded lower profits as its turnover showed a erratic trend. The Subject's management was unable to control its costs efficiently as its profit showed a downward trend. The Subject was in good liquidity position with its total current liabilities well covered by its total current assets. With its current net assets, the Subject should be able to repay its short term obligations. With the favourable interest cover, the Subject could be able to service all the accrued interest without facing any difficulties. The Subject's gearing level was high and its going concern will be in doubt if there is no injection of additional shareholders' funds in times of economic downturn and / or high interest rates.

 

 

 

 

 

 

 

Overall financial condition of the Subject : STABLE

 

 

 

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

25111 : Manufacture of industrial frameworks in metal

25111 : Manufacture of industrial frameworks in metal

 

 

INDUSTRY :

MANUFACTURING

 

 

 

The Manufacturing sector is one of the important sectors to the growth of the Malaysian economy. According to Ministry of Finance, the manufacturing sector is expected to grow 4.9% in year 2013. Export oriented-industries are expected to benefit from the higher growth of global trade, while domesticoriented industries expand in line with the better consumer sentiment and business confidence. The resource-based industries are envisaged to grow steadily attributed to improved demand for petroleum, chemical, rubber and plastic products. With better job prospects and higher disposable income, the transportation equipment subsector, in particular, the passenger car segment is expected to expand. 

 

Value-added of the manufacturing sector expanded 5% during the first half of 2012. Output of the sector rose 5.2% during the first sevenmonths of 2012 in line with the increase in sales value of manufactured products by 6.5% to RM363.1 billion. Output from domesticoriented industries continued to expand 8.6% while export-oriented industries grew 4.1%.

 

According to the Department of Statistics, the sales value of the Manufacturing sector in January 2013 posted a growth of 7.4% (RM3.6 billion) to record RM52.4 billion as compared to RM48.8 billion reported in year 2012. Meanwhile, month-on-month basis, the sales value has decreased by 0.4% (RM0.2 billion) as compared with the preceding month. The sales value in December 2012 has been revised positive 7.5% year-on-year to record RM52.6 billion. 

 

Output of rubber products increased 3.6% in the first seven month of 2012 mainly supported by continuous demand for rubber gloves. Output of rubber gloves grew 5.9% on account of the expansion in the global healthcare industry and wider usage of gloves in other sectors. Similarly, output of catheters, especially for use in medical appliances, also registered a strong growth of 12.6%. Nevertheless, production of rubber tyres and tubes reduced 10.9% in tandem with slowing external demand from the automotive industry, especially China. 

 

Meanwhile, production of wood and wood products rebounded 4.6% largely supported by higher demand for wooden and cane furniture (33.5%). The positive performance was attributed to vibrant higher demand from major export destinations such as China and the United States (US) for Malaysian-made furniture. Demand from China accelerated further following the country’s rising income level and the implementation of zero import duty on Malaysian made-furniture. Malaysia government has growth target of 6.5% for wood based furniture where estimated to reach up to RM53 billion by year 2020.The government providing pioneer status for tax exemption and investment tax allowance for this industry as a boost up step towards produce good quality product and to meet the world demand.

 

The output of chemicals and chemical products rose 9.9% in the first seven month of year 2012 on account of increasing demand for plastic products (11.8%) and basic chemicals (11.1%). External demand for plastic packaging materials surged during the early part of the year 2012, particularly from Japan and Thailand, as manufacturers resumed operations, which were interrupted by natural calamities and power outages. Chemical production are expected to show 7.5 % in year 2013 inline with Malaysia as one of the largest contributor in world Chemicals & Chemical industries. 

 

Tax and non-tax incentives provided by goverment encourage manufacturers to move up the value chain of manufacturing industry. The new growth initiatives by goverment in the manufacturing sector such assolar and medial services can be important drivers of growth apart from helping to diversify the manufacturing base and contributing to the resilience of the sector.

 

 

OVERALL INDUSTRY OUTLOOK : Average Growth

 

CREDIT RISK EVALUATION & RECOMMENDATION

 

 

Incorporated in 1990, the Subject is a Private Limited company, focusing on manufacturing of formwork system for civil engineering construction. The Subject has been in business for over two decades. It has built up a strong clientele base and good reputation will enable the Subject to further enhance its business in the near term. The Subject is expected to enjoy a stable market shares. Having strong support from its holding company has enabled the Subject to remain competitive despite the challenging business environment. The capital standing of the Subject is fair. With an adequate share capital, the Subject has the potential of expanding its business in future. 

Over the years, the Subject has penetrated into both the local and overseas market. The Subject has positioned itself in the global market and is competing in the industry. Its stable clientele base will enable the Subject to further enhance its business in the near term. Being a large entity, the Subject has a steady workforce of 600 personnel to support its business operations. Its future prospects seem to be fairly good as its business operations are running relatively stable. The Subject has a good management capability. Its capable management team has enabled the Subject to keep its business on going. Hence, the future prospect of the Subject is bright. 

The Subject's business performance showed a reverse trend as both its turnover and pre-tax profit have decreased compared to the previous year. Based on the higher profitability, the Subject has generated a favourable return based on its existing shareholders' funds which indicated that the management was efficient in utilising its funds to generate income. The Subject 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. The high gearing ratio clearly implied that the Subject was supported by more debt than equity. Given a positive net worth standing at MYR 19,992,974, the Subject should be able to maintain its business in the near terms. 

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

The Subject's payment habit is average. With its adequate working capital, the Subject should be able to pay its short term debts. 

The industry shows an upward trend and this trend is very likely to sustain in the near terms. Hence, the Subject is expected to benefit from the favourable outlook of the industry. 

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

 


PROFIT AND LOSS ACCOUNT

 

 

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

MFE FORMWORK TECHNOLOGY SDN. BHD.

 

Financial Year End

2012-12-31

2011-12-31

2010-12-31

2009-12-31

2008-12-31

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

144,850,455

203,474,081

166,066,246

135,344,172

302,366,945

Other Income

-

-

4,009,906

-

-

 

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

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

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

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

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

Total Turnover

144,850,455

203,474,081

170,076,152

135,344,172

302,366,945

Costs of Goods Sold

(119,084,081)

(174,690,585)

(138,688,192)

-

-

 

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

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

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

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

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

Gross Profit

25,766,374

28,783,496

31,387,960

-

-

 

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

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

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

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

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

 

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

9,574,339

13,685,200

8,336,760

(28,977,393)

33,983,537

 

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

9,574,339

13,685,200

8,336,760

(28,977,393)

33,983,537

Taxation

(2,037,389)

(1,467,786)

(2,969,747)

(937,807)

(9,707,268)

 

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

7,536,950

12,217,414

5,367,013

(29,915,200)

24,276,269

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

 

As previously reported

27,552,037

16,659,436

14,493,811

60,440,938

51,265,339

Prior year adjustment

-

-

-

-

(9,203,743)

 

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

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

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

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

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

As restated

27,552,037

16,659,436

14,493,811

60,440,938

42,061,596

 

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

35,088,987

28,876,850

19,860,824

30,525,738

66,337,865

DIVIDENDS - Ordinary (paid & proposed)

(17,096,013)

(1,324,813)

(3,201,388)

(16,031,927)

(5,896,927)

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

17,992,974

27,552,037

16,659,436

14,493,811

60,440,938

 

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

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

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

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

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

 

 

 

 

 

 

INTEREST EXPENSE (as per notes to P&L)

 

 

 

 

 

Bank overdraft

171,705

299,049

686,865

232,601

11,041

Hire purchase

9,104

4,238

8,786

14,408

16,362

Revolving loans

141,103

-

-

-

-

Term loan / Borrowing

375,132

-

-

-

-

Others

170,535

74,790

205,775

84,765

13,037

 

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

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

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

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

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

 

867,579

378,077

901,426

331,774

40,440

 

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

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

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

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

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

 

 

 

BALANCE SHEET

 

 

MFE FORMWORK TECHNOLOGY SDN. BHD.

 

ASSETS EMPLOYED:

 

 

 

 

 

FIXED ASSETS

12,040,004

8,053,641

9,180,149

4,183,750

4,603,671

 

 

 

 

 

 

Investments

7,670

7,670

7,670

7,670

7,670

 

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

7,670

7,670

7,670

7,670

7,670

 

 

 

 

 

 

 

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

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

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

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

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

TOTAL LONG TERM ASSETS

12,047,674

8,061,311

9,187,819

4,191,420

4,611,341

 

 

 

 

 

 

Stocks

19,403,505

21,087,528

18,562,350

19,432,113

38,173,946

Trade debtors

45,396,111

42,616,219

34,591,513

25,514,198

54,231,810

Other debtors, deposits & prepayments

2,565,395

3,418,518

2,401,481

1,444,876

4,292,135

Amount due from holding company

2,940,686

-

-

-

-

Amount due from related companies

-

-

120,299

25,665

20,773

Cash & bank balances

785,535

426,924

6,596,188

13,013,323

18,797,095

Others

4,448,509

5,185,981

4,458,304

2,792,223

1,147,797

 

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

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

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

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

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

TOTAL CURRENT ASSETS

75,539,741

72,735,170

66,730,135

62,222,398

116,663,556

 

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

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

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

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

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

TOTAL ASSET

87,587,415

80,796,481

75,917,954

66,413,818

121,274,897

 

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

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

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

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

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

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Trade creditors

24,904,139

29,460,910

33,990,168

32,189,311

50,245,255

Other creditors & accruals

14,965,560

11,466,706

8,532,873

7,727,650

7,220,688

Hire purchase & lease creditors

563,507

27,010

34,198

69,452

163,206

Bank overdraft

-

4,456,059

4,265,600

9,491,832

-

Other borrowings

11,326,938

5,204,014

9,025,393

-

-

Amounts owing to holding company

-

86,158

69,725

61,541

46,451

Amounts owing to related companies

531,636

238,948

198,943

-

-

Amounts owing to director

897,210

-

-

-

-

 

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

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

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

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

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

TOTAL CURRENT LIABILITIES

53,188,990

50,939,805

56,116,900

49,539,786

57,675,600

 

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

22,350,751

21,795,365

10,613,235

12,682,612

58,987,956

 

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

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

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

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

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

TOTAL NET ASSETS

34,398,425

29,856,676

19,801,054

16,874,032

63,599,297

 

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

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

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

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

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

 

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

 

Ordinary share capital

1,000,000

1,000,000

1,000,000

1,000,000

1,000,000

 

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

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

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

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

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

TOTAL SHARE CAPITAL

1,000,000

1,000,000

1,000,000

1,000,000

1,000,000

 

 

 

 

 

 

Retained profit/(loss) carried forward

17,992,974

27,552,037

16,659,436

14,493,811

60,440,938

Capital redemption reserve

1,000,000

1,000,000

1,000,000

1,000,000

1,000,000

 

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

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

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

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

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

TOTAL RESERVES

18,992,974

28,552,037

17,659,436

15,493,811

61,440,938

 

 

 

 

 

 

 

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

19,992,974

29,552,037

18,659,436

16,493,811

62,440,938

 

 

 

 

 

 

Long term loans

13,159,080

-

-

-

-

Hire purchase creditors

574,870

60,734

87,737

7,192

76,644

Deferred taxation

671,501

243,905

1,053,881

373,029

1,081,715

 

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

14,405,451

304,639

1,141,618

380,221

1,158,359

 

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

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

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

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

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

 

34,398,425

29,856,676

19,801,054

16,874,032

63,599,297

 

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

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

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

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

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

 

 

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

MFE FORMWORK TECHNOLOGY SDN. BHD.

 

TYPES OF FUNDS

 

 

 

 

 

Cash

785,535

426,924

6,596,188

13,013,323

18,797,095

Net Liquid Funds

785,535

(4,029,135)

2,330,588

3,521,491

18,797,095

Net Liquid Assets

2,947,246

707,837

(7,949,115)

(6,749,501)

20,814,010

Net Current Assets/(Liabilities)

22,350,751

21,795,365

10,613,235

12,682,612

58,987,956

Net Tangible Assets

34,398,425

29,856,676

19,801,054

16,874,032

63,599,297

Net Monetary Assets

(11,458,205)

403,198

(9,090,733)

(7,129,722)

19,655,651

BALANCE SHEET ITEMS

 

 

 

 

 

Total Borrowings

25,765,498

9,747,817

13,412,928

9,568,476

239,850

Total Liabilities

67,594,441

51,244,444

57,258,518

49,920,007

58,833,959

Total Assets

87,587,415

80,796,481

75,917,954

66,413,818

121,274,897

Net Assets

34,398,425

29,856,676

19,801,054

16,874,032

63,599,297

Net Assets Backing

19,992,974

29,552,037

18,659,436

16,493,811

62,440,938

Shareholders' Funds

19,992,974

29,552,037

18,659,436

16,493,811

62,440,938

Total Share Capital

1,000,000

1,000,000

1,000,000

1,000,000

1,000,000

Total Reserves

18,992,974

28,552,037

17,659,436

15,493,811

61,440,938

LIQUIDITY (Times)

 

 

 

 

 

Cash Ratio

0.01

0.01

0.12

0.26

0.33

Liquid Ratio

1.06

1.01

0.86

0.86

1.36

Current Ratio

1.42

1.43

1.19

1.26

2.02

WORKING CAPITAL CONTROL (Days)

 

 

 

 

 

Stock Ratio

49

38

41

52

46

Debtors Ratio

114

76

76

69

65

Creditors Ratio

76

62

89

87

61

SOLVENCY RATIOS (Times)

 

 

 

 

 

Gearing Ratio

1.29

0.33

0.72

0.58

0.00

Liabilities Ratio

3.38

1.73

3.07

3.03

0.94

Times Interest Earned Ratio

12.04

37.20

10.25

(86.34)

841.34

Assets Backing Ratio

34.40

29.86

19.80

16.87

63.60

PERFORMANCE RATIO (%)

 

 

 

 

 

Operating Profit Margin

6.61

6.73

5.02

(21.41)

11.24

Net Profit Margin

5.20

6.00

3.23

(22.10)

8.03

Return On Net Assets

30.36

47.10

46.66

(169.76)

53.50

Return On Capital Employed

29.75

40.95

38.33

(108.36)

53.36

Return On Shareholders' Funds/Equity

37.70

41.34

28.76

(181.37)

38.88

Dividend Pay Out Ratio (Times)

2.27

0.11

0.60

0.54

0.24

NOTES TO ACCOUNTS

 

 

 

 

 

Contingent Liabilities

0

0

0

0

0




FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.60.42

UK Pound

1

Rs.100.11

Euro

1

Rs.79.74

 

 

INFORMATION DETAILS

 

Report Prepared by :

PDT

 

 

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.