MIRA INFORM REPORT

 

 

Report Date :

05.12.2014

 

IDENTIFICATION DETAILS

 

Name :

TAB FRESH SDN. BHD.

 

 

Formerly Known As :

RIMBA SEPAKAT SDN BHD (29/06/1998)

 

 

Registered Office :

157A, Jalan Sri Pelangi, Taman Pelangi, 80400 Johor Bahru, Johor

 

 

Country :

Malaysia

 

 

Financials (as on) :

30.06.2012

 

 

Date of Incorporation :

02.02.1983

 

 

Com. Reg. No.:

97084-P

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Subject is principally engaged in the trading of fruits, vegetables and other grocery items.

 

 

No of Employees :

7 [2014]

 

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Status :

Moderate

Payment Behaviour :

Slow

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 1, 2014

 

Country Name

Previous Rating

(31.03.2014)

Current Rating

(01.06.2014)

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 sustained budget deficits, has forced Kuala Lumpur to begin to address fiscal shortfalls, through initial reductions in energy and sugar subsidies and the announcement of the 2015 implementation of a 6% goods and services tax. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplies about 32% of government revenue in 2013. Bank Negara 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 earlier raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but retreated in 2013 after he encountered significant opposition from Malay nationalists and other vested interests. In September 2013 NAJIB launched the new Bumiputra Economic Empowerment Program (BEEP), policies that favor and advance the economic condition of ethnic Malays.

 

Source : CIA

EXECUTIVE SUMMARY

 

 

REGISTRATION NO.

:

97084-P

COMPANY NAME

:

TAB FRESH SDN. BHD.

FORMER NAME

:

RIMBA SEPAKAT SDN BHD (29/06/1998)

INCORPORATION DATE

:

02/02/1983

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

157A, JALAN SRI PELANGI, TAMAN PELANGI, 80400 JOHOR BAHRU, JOHOR, MALAYSIA.

BUSINESS ADDRESS

:

29, JALAN ARUNG, PERINDUSTRIAN TAMAN JOHOR, 81200 JOHOR BAHRU, JOHOR, MALAYSIA.

TEL.NO.

:

07-2384151

FAX.NO.

:

07-2343600

CONTACT PERSON

:

TEOH AH BAH ( MANAGING DIRECTOR )

INDUSTRY CODE

:

46313

PRINCIPAL ACTIVITY

:

TRADING OF FRUITS, VEGETABLES AND OTHER GROCERY ITEMS

AUTHORISED CAPITAL

:

MYR 500,000.00 DIVIDED INTO 

ORDINARY SHARE 500,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 300,000.00 DIVIDED INTO 

ORDINARY SHARES 300,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 11,579,439 [2012]

NET WORTH

:

MYR 116,090 [2012]

STAFF STRENGTH

:

7 [2014]

BANKER (S)

:

OCBC BANK (MALAYSIA) BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

POOR

PAYMENT

:

SLOW

MANAGEMENT CAPABILITY

:

WEAK

COMMERCIAL RISK

:

MODERATE

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

SATISFACTORY

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) trading of fruits, vegetables and other grocery items.

 

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

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

15/02/2013

MYR 500,000.00

MYR 300,000.00

 

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

Name

Address

IC/PP/Loc No

Shareholding

(%)

MR. TEOH AH BAH +

8, LORONG 4, JALAN SRI PELANGI 1, TAMAN PELANGI, 80400 JOHOR BAHRU, JOHOR, MALAYSIA.

510523-08-5139

299,999.00

100.00

MR. LEE SOOK CHIN +

61 JALAN BUNGA TANJUNG 12, TAMAN SARAYA, 56100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

750822-14-5501 A3140801

1.00

0.00

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

------

300,000.00

100.00

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

=====

+ Also Director

 

 

DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. LEE SOOK CHIN

Address

:

61 JALAN BUNGA TANJUNG 12, TAMAN SARAYA, 56100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

A3140801

New IC No

:

750822-14-5501

Date of Birth

:

22/08/1975

Nationality

:

MALAYSIAN

Date of Appointment

:

15/01/2002

 

DIRECTOR 2

 

Name Of Subject

:

MR. TEOH AH BAH

Address

:

8, LORONG 4, JALAN SRI PELANGI 1, TAMAN PELANGI, 80400 JOHOR BAHRU, JOHOR, MALAYSIA.

New IC No

:

510523-08-5139

Date of Birth

:

23/05/1951

Nationality

:

MALAYSIAN

Date of Appointment

:

16/11/1987

 

 

 

MANAGEMENT

 

 

1)

Name of Subject

:

TEOH AH BAH

Position

:

MANAGING DIRECTOR

 

 

AUDITOR

 

Auditor

:

HUANG YAN TEO & CO.

Auditor' Address

:

157B, JALAN SRI PELANGI, TAMAN PELANGI, 80400 JOHOR BAHRU, JOHOR, MALAYSIA.

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. LILIAN LOW

IC / PP No

:

6226525

New IC No

:

610912-01-5968

Address

:

157A, JALAN SRI PELANGI, TAMAN PELANGI, 80400 JOHOR BAHRU, JOHOR, MALAYSIA.

 

2)

Company Secretary

:

MS. CHONG HAN CHIN

IC / PP No

:

A1655221

New IC No

:

700803-08-5472

Address

:

157A, JALAN SRI PELANGI, TAMAN PELANGI, 80400 JOHOR BAHRU, JOHOR, MALAYSIA.

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

OCBC BANK (MALAYSIA) BHD

 

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

04/11/2010

CASH-BACKED OVERDRAFT FACILITY APPLICATION FORM

OCBC BANK (MALAYSIA) BHD

-

Unsatisfied

 

 

LITIGATION CHECK AGAINST SUBJECT


* A check has been conducted in our databank againt 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.


No blacklisted record & debt collection case was found in our defaulters' databank.



PAYMENT RECORD

 

 

SOURCES OF RAW MATERIALS:

Local

:

YES

Overseas

:

YES

Import Countries

:

AUSTRALIA,NEW ZEALAND,INDIA


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

[

X

]

Average 61-90 Days

[

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

 

CLIENTELE

 

Local

:

YES

Percentage

:

90%

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Percentage

:

10%

Export Market

:

SINGAPORE

Credit Term

:

30 - 60 DAYS

Payment Mode

:

TELEGRAPHIC TRANSFER (TT)
LETTER OF CREDIT (LC)

Type of Customer

:

SUPERMARKETS,HYPERMARKETS

 

OPERATIONS

 

Goods Traded

:

FRUITS, VEGETABLES AND OTHER GROCERY ITEMS

Competitor(s)

:

AGROQUIVIR FRUITS (M) SDN BHD

Ownership of premises

:

LEASED/RENTED

 

Total Number of Employees:

 

YEAR

2014

2013

2012

2011

2010

 

GROUP

N/A

N/A

N/A

N/A

N/A

COMPANY

7

7

5

5

5

 

Branch

:

NO

Other Information:


The Subject is principally engaged in the (as a / as an) trading of fruits, vegetables and other grocery items. 


The Subject's tropical fruits includes mango, papaya, pineapple, water melon, orange, banana, apple and others.

Besides that, the Subject also sells onion, potato, red chillie and condiments such as oyster sauce, oregano


The Subject normally sells in large quantity. It has its own transport to deliver the goods to its customers' destinations. 


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

07-2384151

Match

:

N/A

Address Provided by Client

:

29, JALAN ARUNG, PERINDUSTRIAN TAMAN JOHOR,81200,JOHOR BAHRU,JOHOR.

Current Address

:

29, JALAN ARUNG, PERINDUSTRIAN TAMAN JOHOR, 81200 JOHOR BAHRU, JOHOR, 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

:

Decreased

[

2009 - 2012

]

Profit/(Loss) Before Tax

:

Decreased

[

2009 - 2012

]

Return on Shareholder Funds

:

Unfavourable

[

(46.76%)

]

Return on Net Assets

:

Unfavourable

[

(0.43%)

]

The continuous fall in turnover could be due to the lower demand for the Subject's products / services.The Subject incurred losses during the year due to the inefficient control of its operating costs. The Subject's unfavourable returns on shareholders' funds indicate the management's inefficiency in utilising its assets to generate returns.

Working Capital Control

Stock Ratio

:

Nil

[

0 Days

]

Debtor Ratio

:

Favourable

[

50 Days

]

Creditors Ratio

:

Favourable

[

24 Days

]

As the Subject is a service oriented company, the Subject does not need to keep stocks. The favourable debtors' days could be due to the good credit control measures implemented by the Subject. The Subject had a favourable creditors' ratio where the Subject could be taking advantage of the cash discounts and also wanting to maintain goodwill with its creditors.

Liquidity

Liquid Ratio

:

Favourable

[

1.11 Times

]

Current Ratio

:

Unfavourable

[

1.11 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

:

Unfavourable

[

(0.04 Times)

]

Gearing Ratio

:

Unfavourable

[

10.40 Times

]

The Subject incurred losses in the year. It did not generate sufficient income to service its interest.  If the situation does not improve, the Subject may be vulnerable to default in servicing the interest. 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's losses could be attributed to the lower turnover which in turn could be the result of unfavourable market conditions. 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. The Subject's interest cover was negative, indicating that it did not generate sufficient income to service its interest. If its result does not show impressive improvements or succeed obtaining short term financing or capital injection, it may not be able to service its interest and repay the loans. 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 : POOR

 

 

 

MALAYSIA ECONOMIC / INDUSTRY OUTLOOK

 

Major Economic Indicators:

2011

2012

2013

2014*

2015**

Population ( Million)

28.7

29.3

29.8

30.3

30.5

Gross Domestic Products ( % )

5.1

5.6

5.3

6.0

6.0

Domestic Demand ( % )

8.2

9.4

5.6

6.4

6.2

Private Expenditure ( % )

8.2

8.0

8.6

7.9

6.9

Consumption ( % )

7.1

1.0

5.7

6.5

5.6

Investment ( % )

12.2

11.7

13.3

12.0

10.7

Public Expenditure ( % )

8.4

13.3

4.4

2.3

4.2

Consumption ( % )

16.1

11.3

(1.2)

2.1

3.8

Investment ( % )

(0.3)

15.9

4.2

2.6

4.7

Balance of Trade ( MYR Million )

116,058

106,300

71,298

52,314

-

Government Finance ( MYR Million )

(45,511)

(42,297)

(39,993)

(37,291)

-

Government Finance to GDP / Fiscal Deficit ( % )

(5.4)

(4.5)

(4.0)

(3.5)

(3.0)

Inflation ( % Change in Composite CPI)

3.1

1.6

2.5

3.3

4.0

Unemployment Rate

3.3

3.2

3.0

3.0

3.0

Net International Reserves ( MYR Billion )

415

427

-

417

-

Average Risk-Weighted Capital Adequacy Ratio ( % )

3.50

2.20

-

-

-

Average 3 Months of Non-performing Loans ( % )

14.80

14.70

-

-

-

Average Base Lending Rate ( % )

6.60

6.53

6.53

-

-

Business Loans Disbursed( % )

15.3

32.2

-

-

-

Foreign Investment ( MYR Million )

23,546.1

26,230.4

38,238.0

-

-

Consumer Loans ( % )

-

-

-

-

-

Registration of New Companies ( No. )

45,455

45,441

46,321

-

-

Registration of New Companies ( % )

3.0

(0.0)

1.9

-

-

Liquidation of Companies ( No. )

132,485

17,092

26,430

-

-

Liquidation of Companies ( % )

417.8

(87.1)

54.6

-

-

Registration of New Business ( No. )

284,598

324,761

329,895

-

-

Registration of New Business ( % )

5.0

14.0

2.0

-

-

Business Dissolved ( No. )

20,121

20,380

18,161

-

-

Business Dissolved ( % )

1.9

1.3

(10.9)

-

-

Sales of New Passenger Cars (' 000 Unit )

535.1

552.2

576.7

598.4

610.3

Cellular Phone Subscribers ( Million )

35.3

38.5

43.0

43.8

-

Tourist Arrival ( Million Persons )

24.7

25.0

25.7

28.0

-

Hotel Occupancy Rate ( % )

60.6

62.4

62.6

-

-

Credit Cards Spending ( % )

15.6

12.6

-

-

-

Bad Cheque Offenders (No.)

32,627

26,982

28,876

-

-

Individual Bankruptcy ( No.)

19,167

19,575

21,984

-

-

Individual Bankruptcy ( % )

5.8

2.1

12.3

-

-

 

INDUSTRIES ( % of Growth ):

2011

2012

2013

2014*

2015**

Agriculture

5.8

1.0

2.1

3.8

3.1

Palm Oil

10.8

(0.3)

2.6

6.7

-

Rubber

6.1

(7.9)

(10.1)

(10.4)

-

Forestry & Logging

(7.6)

(4.5)

(7.8)

(4.2)

-

Fishing

2.1

4.3

1.6

2.7

-

Other Agriculture

7.1

6.4

8.2

6.2

-

Industry Non-Performing Loans ( MYR Million )

634.1

-

-

-

-

% of Industry Non-Performing Loans

3.2

-

-

-

-

Mining

(5.4)

1.4

0.9

(0.8)

2.8

Oil & Gas

(1.7)

-

-

-

-

Other Mining

-

-

-

-

-

Industry Non-performing Loans ( MYR Million )

46.5

-

-

-

-

% of Industry Non-performing Loans

0.1

-

-

-

-

Manufacturing #

4.7

4.8

3.4

6.6

5.5

Exported-oriented Industries

4.1

6.5

3.3

5.6

-

Electrical & Electronics

(4.0)

12.7

6.9

13.3

-

Rubber Products

20.7

3.0

11.7

(0.3)

-

Wood Products

(5.1)

8.7

(2.7)

5.1

-

Textiles & Apparel

13.2

(7.1)

(2.6)

11.5

-

Domestic-oriented Industries

10.7

1.7

6.8

9.4

-

Food, Beverages & Tobacco

4.80

2.70

3.60

6.13

6.13

Chemical & Chemical Products

10.0

10.8

5.6

-

-

Plastic Products

3.8

-

-

-

-

Iron & Steel

2.2

(6.6)

5.0

0.1

-

Fabricated Metal Products

21.8

13.8

9.9

2.9

-

Non-metallic Mineral

12.1

2.9

(2.0)

5.4

-

Transport Equipment

12.0

3.4

13.8

22.9

-

Paper & Paper Products

9.5

3.1

1.8

4.7

-

Crude Oil Refineries

9.3

-

-

-

-

Industry Non-Performing Loans ( MYR Million )

6,537.2

-

-

-

-

% of Industry Non-Performing Loans

25.7

-

-

-

-

Construction

4.7

18.6

10.9

12.7

10.7

Industry Non-Performing Loans ( MYR Million )

3,856.9

-

-

-

-

% of Industry Non-Performing Loans

10.2

-

-

-

-

Services

7.1

6.4

5.9

5.9

5.6

Electric, Gas & Water

3.5

4.4

4.2

3.6

3.9

Transport, Storage & Communication

6.50

7.10

7.30

7.50

7.15

Wholesale, Retail, Hotel & Restaurant

5.2

4.7

5.9

6.9

6.5

Finance, Insurance & Real Estate

6.90

9.70

3.70

4.65

4.25

Government Services

12.4

9.4

8.3

6.1

5.6

Other Services

5.1

3.9

5.1

4.8

4.5

Industry Non-Performing Loans ( MYR Million )

6,825.2

-

-

-

-

% of Industry Non-Performing Loans

23.4

-

-

-

-

* Estimate / Preliminary

** Forecast

# Based On Manufacturing Production Index 



INDUSTRY ANALYSIS

 

MSIC CODE

46313 : Wholesale of fruits

INDUSTRY :

TRADING

The wholesale and retail trade is expected to increase 7.1% in 2015 (2014: 7.7%) driven by strong domestic consumption and higher tourist arrivals following the Malaysia Year of Festivals 2015. Besides, in 2014, the wholesale and retail trade subsector is expected to increase 7.7% (2013: 6.4%) supported by strong domestic consumption.

According to Retail Group Malaysia (RGM), the pharmacy and personal care sub-sector had slow growth rate of 2.6% for the first quarter of 2014, while "other specialty stores" grew at a rate of 3.5%. During the first quarter of 2014, fashion and fashion accessories recorded a sustainable growth of 6.3% as compared with the same period last year (3.6%).

The retail segment increased 10.1% (January - June 2013: 7.1%) attributed to brisk sales in retail outlets such as hypermarkets and large-scale superstores. Since the launch of the Small Retailer Transformation programme (TUKAR) in January 2011 up to end-July 2014, 1,761 small retailer stores (end-July 2013: 1,381) have been modernized to improve their competitiveness. In addition, the strong growth of the retail segment was supported by 1Malaysia Unified Sales held from 29 June 2014 to 1 September 2014 to attract foreign and local tourists to shop in Malaysia. Meanwhile, the wholesale segment expanded 8.2% (January - June 2013: 4.9%) due to higher sales of non-agricultural intermediate products, such as petrol, diesel, lubricants and household goods. Furthermore, food and beverage outlets, laundry outlets, car wash centres, abd health and beauty outlets took a hit from the water rationing in the Klang Valley since February this year.

On the other hand, in 2014, Malaysia's total trade is expected to grow 5.2% to RM1.44 trillion (2013: 4.5%; RM1.37 trillion) underpinned by recovery in key advanced economies, resilient regional demand, and partly due to the base effect arising from sluggish exports in the corresponding period last year. Gross exports are anticipated to expand 6% to RM762.8 billion while import decreased 4.3% to RM677.2 billion (2013: 2.4%; RM719.8 billion; 7%; RM 649.1 billion). Consequently, the trade surplus is expected to be higher at RM85.6 billion or 7.9% of GDP in 2014 (2013: RM70.7 billion; 7.2%).

Furthermore, gross exports rebounded by 10.7% to RM441.3 billion during the first seven months of 2014 (January - July 2013: -2.8%; RM398.5 billion), with manufactured and mining exports rising at a double digit pace of 11.4% and 12.5%. Shipment of agriculture products grew at a slower pace of 2.7%, primarily due to lower receipts of crude rubber (-24.6%) while export growth of other commodities remained steady. Consequently, exports of manufactured and mining products are expected to grow 6.1% and 6.4% in 2014 (2013: 5.1%; 3.3%). Meanwhile, agriculture exports are expected to rebound sharply by 4.5% in 2014 (2013: -14.4%) despite moderating commodity prices. Malaysia's top 3 trading partners are China, Singapore, and Japan. 

Over 60% of Gross Domestic Product (GDP) is contributed by domestic consumption. Therefore the wholesale and retail sector plays a crucial role in driving Malaysia's growth over the next decade despite the ongoing global economic slowdown. By 2020, Malaysia's wholesale and retail sector is expected to boost the country's total Gross National Income (GNI) by RM156 billion, creating 454,190 new jobs.

OVERALL INDUSTRY OUTLOOK : Average Growth



CREDIT RISK EVALUATION & RECOMMENDATION

 


Incorporated in 1983, the Subject is a Private Limited company, focusing on trading of fruits, vegetables and other grocery items. The Subject has been in business for over two decades. It has built up a strong clientele base and satisfactory reputation will enable the Subject to further enhance its business in the near term. The Subject is expected to enjoy a stable market shares. Being a small company with an issued and a paid up capital of MYR 300,000 contributed from individual shareholders, the Subject does not have strong shareholders' backing. Without a strong backing, the Subject may face difficulties in its attempt to further expand its business in the future. 

Apart from supplying its products to the local market, the Subject also exports to overseas countries. Its ability to penetrate into the global market has benefited the Subject in terms of higher profitability and well diversified its business risk. Hence, better growth prospect can be expected. The Subject is considered as a small company with only 7 employees in its operation. Overall, we regard that the Subject's management capability is weak. Without capable management, the Subject is unlikely to be successful and often contribute to unacceptable levels of accountability. Weak management can affect productivity, profitability, sales growth and ultimately can result in the failure of a business. 


Due to the challenging market conditions, the Subject's business performance seems to be deteriorating and losses incurred. The Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. 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. Thus, the Subject is exposed to high financial risk. 


Without a strong assets backing, the Subject may face difficulties in getting loans for its future expansion and continued growth . 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. 


Overall, the Subject's payment habit is good as the Subject has a good credit control and it could be taking advantage of the cash discounts while maintaining a good reputation with its creditors. 


The industry shows an upward trend and this trend is very likely to sustain in the near terms. 


In view of the above, we only recommend credit be proceeded to the Subject with guarantee.

 



PROFIT AND LOSS ACCOUNT

 

 

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

TAB FRESH SDN. BHD.

 

Financial Year End

2012-06-30

2011-06-30

2010-06-30

2009-06-30

Months

12

12

12

12

Consolidated Account

Company

Company

Company

Company

Audited Account

YES

YES

YES

YES

Unqualified Auditor's Report (Clean Opinion)

YES

YES

YES

YES

Financial Type

FULL

FULL

FULL

FULL

Currency

MYR

MYR

MYR

MYR

TURNOVER

11,579,439

13,697,758

14,079,039

13,301,941

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

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

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

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

Total Turnover

11,579,439

13,697,758

14,079,039

13,301,941

Costs of Goods Sold

(10,218,186)

(12,421,973)

(12,604,043)

-

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

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

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

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

Gross Profit

1,361,253

1,275,785

1,474,996

-

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

(47,657)

65,125

61,959

2,312

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

(47,657)

65,125

61,959

2,312

Taxation

(6,632)

(8,302)

149

(3,154)

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

(54,289)

56,823

62,108

(842)

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

(129,621)

(186,444)

(248,553)

(247,711)

Prior year adjustment

-

-

1

-

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

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

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

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

As restated

(129,621)

(186,444)

(248,552)

(247,711)

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

(183,910)

(129,621)

(186,444)

(248,553)

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

(183,910)

(129,621)

(186,444)

(248,553)

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Bank overdraft

31,180

24,337

8,680

18,089

Hire purchase

14,681

11,531

11,033

23,551

Others

-

-

-

1,269

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

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

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

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

45,861

35,868

19,713

42,909

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

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

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

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE SHEET

 

 

TAB FRESH SDN. BHD.

 

ASSETS EMPLOYED:

FIXED ASSETS

208,034

315,851

249,179

259,043

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

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

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

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

TOTAL LONG TERM ASSETS

208,034

315,851

249,179

259,043

Trade debtors

1,581,033

1,958,645

3,326,620

3,296,683

Other debtors, deposits & prepayments

230,704

245,118

577,560

293,086

Short term deposits

209,122

368,858

385,777

381,825

Cash & bank balances

9,911

9,548

18,600

11,927

Others

-

-

2,400

-

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

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

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

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

TOTAL CURRENT ASSETS

2,030,770

2,582,169

4,310,957

3,983,521

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

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

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

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

TOTAL ASSET

2,238,804

2,898,020

4,560,136

4,242,564

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

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

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

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

CURRENT LIABILITIES

Trade creditors

659,857

794,543

2,981,410

2,816,787

Other creditors & accruals

254,943

323,326

259,544

234,732

Hire purchase & lease creditors

80,863

80,863

52,062

58,400

Bank overdraft

699,162

894,293

498,984

323,045

Short term borrowings/Term loans

127,828

122,656

119,887

115,313

Provision for taxation

542

202

-

208

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

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

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

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

TOTAL CURRENT LIABILITIES

1,823,195

2,215,883

3,911,887

3,548,485

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

207,575

366,286

399,070

435,036

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

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

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

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

TOTAL NET ASSETS

415,609

682,137

648,249

694,079

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

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

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

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

SHARE CAPITAL

Ordinary share capital

300,000

300,000

250,000

250,000

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

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

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

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

TOTAL SHARE CAPITAL

300,000

300,000

250,000

250,000

Retained profit/(loss) carried forward

(183,910)

(129,621)

(186,444)

(248,553)

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

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

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

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

TOTAL RESERVES

(183,910)

(129,621)

(186,444)

(248,553)

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

116,090

170,379

63,556

1,447

Long term loans

192,546

323,922

447,994

569,122

Hire purchase creditors

106,973

187,836

136,699

123,510

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

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

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

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

TOTAL LONG TERM LIABILITIES

299,519

511,758

584,693

692,632

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

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

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

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

415,609

682,137

648,249

694,079

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

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

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

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

 

 

 

 

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

TAB FRESH SDN. BHD.

 

TYPES OF FUNDS

Cash

219,033

378,406

404,377

393,752

Net Liquid Funds

(480,129)

(515,887)

(94,607)

70,707

Net Liquid Assets

207,575

366,286

399,070

435,036

Net Current Assets/(Liabilities)

207,575

366,286

399,070

435,036

Net Tangible Assets

415,609

682,137

648,249

694,079

Net Monetary Assets

(91,944)

(145,472)

(185,623)

(257,596)

BALANCE SHEET ITEMS

Total Borrowings

1,207,372

1,609,570

1,255,626

1,189,390

Total Liabilities

2,122,714

2,727,641

4,496,580

4,241,117

Total Assets

2,238,804

2,898,020

4,560,136

4,242,564

Net Assets

415,609

682,137

648,249

694,079

Net Assets Backing

116,090

170,379

63,556

1,447

Shareholders' Funds

116,090

170,379

63,556

1,447

Total Share Capital

300,000

300,000

250,000

250,000

Total Reserves

(183,910)

(129,621)

(186,444)

(248,553)

LIQUIDITY (Times)

Cash Ratio

0.12

0.17

0.10

0.11

Liquid Ratio

1.11

1.17

1.10

1.12

Current Ratio

1.11

1.17

1.10

1.12

WORKING CAPITAL CONTROL (Days)

Stock Ratio

0

0

0

0

Debtors Ratio

50

52

86

90

Creditors Ratio

24

23

86

77

SOLVENCY RATIOS (Times)

Gearing Ratio

10.40

9.45

19.76

821.97

Liabilities Ratio

18.29

16.01

70.75

2,930.97

Times Interest Earned Ratio

(0.04)

2.82

4.14

1.05

Assets Backing Ratio

1.39

2.27

2.59

2.78

PERFORMANCE RATIO (%)

Operating Profit Margin

(0.41)

0.48

0.44

0.02

Net Profit Margin

(0.47)

0.41

0.44

(0.01)

Return On Net Assets

(0.43)

14.81

12.60

6.52

Return On Capital Employed

(0.15)

6.09

6.81

4.20

Return On Shareholders' Funds/Equity

(46.76)

33.35

97.72

(58.19)

Dividend Pay Out Ratio (Times)

0.00

0.00

0.00

0.00

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

0

 

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.61.88

UK Pound

1

Rs.97.02

Euro

1

Rs.76.13                                 

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

Report Prepared by :

SMN

 

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.