MIRA INFORM REPORT

 

 

Report Date :

13.12.2014

 

IDENTIFICATION DETAILS

 

Name :

LEADER UNIVERSAL ALUMINIUM SDN. BHD.

 

 

Formerly Known As :

CHONG SHING CABLES & ELECTRICAL INDUSTRY SDN BHD

 

 

Registered Office :

Suite 7A, Menara Northam, 55 Jalan Sultan Ahmad Shah, 10050 Pulau Pinang, Pulau Pinang

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2013

 

 

Date of Incorporation :

15.11.1977

 

 

Com. Reg. No.:

36093-H

 

 

Legal Form :

Private Limited (Limited By Share)

 

 

Line of Business :

·         Engaged in Manufacturing and Sale of Cables

·         Engaged in manufacturing High Voltage as well as Upstream Products such as Copper and Aluminium Rods and Wires.

 

 

No. of Employees :

200 [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 :

Slow but correct

 

 

Litigation :

Clear

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – September 30, 2014

 

Country Name

Previous Rating

(30.06.2014)

Current Rating

(30.09.2014)

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.

:

36093-H

COMPANY NAME

:

LEADER UNIVERSAL ALUMINIUM SDN. BHD.

FORMER NAME

:

CHONG SHING CABLES SDN BHD (28/11/2007)
CHONG SHING CABLES & ELECTRICAL INDUSTRY SDN BHD (02/03/1981)

INCORPORATION DATE

:

15/11/1977

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED (LIMITED BY SHARE)

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

SUITE 7A, MENARA NORTHAM, 55 JALAN SULTAN AHMAD SHAH, 10050 PULAU PINANG, PULAU PINANG, MALAYSIA.

BUSINESS ADDRESS

:

2, JALAN TAHANA, KAWASAN PERINDUSTRIAN TAMPOI, 81200 JOHOR BAHRU, JOHOR, MALAYSIA.

TEL.NO.

:

07-2381888

FAX.NO.

:

07-2386333

CONTACT PERSON

:

LIM WENG SOON ( DIRECTOR )

 

 

 

INDUSTRY CODE

:

27320

PRINCIPAL ACTIVITY

:

·         Engaged in Manufacturing and Sale of Cables

·         Engaged in manufacturing high voltage as well as upstream products such as copper and aluminium rods and wires.

AUTHORISED CAPITAL

:

MYR 25,000,000.00 DIVIDED INTO
ORDINARY SHARE 25,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 22,000,000.00 DIVIDED INTO
ORDINARY SHARES 21,650,000 CASH AND 350,000 OTHERWISE OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 500,473,000 [2013]

NET WORTH

:

MYR 22,717,155 [2013]

 

 

 

STAFF STRENGTH

:

200 [2014]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

FAIR

PAYMENT

:

N/A

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) manufacture & sale of cables.

 

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

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

07/01/2013

MYR 25,000,000.00

MYR 22,000,000.00

31/12/2011

MYR 25,000,000.00

MYR 7,000,000.00

 

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

 

Name

Address

IC/PP/Loc No

Shareholding

(%)

MALAYSIA NOMINEES (TEMPATAN) SENDIRIAN BERHAD

14TH.FLR.,WISMA LEE RUBBER, JLN.MELAKA, KUALA LUMPUR, MALAYSIA.

6193K

22,000,000.00

100.00

 

 

 

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

------

 

 

 

22,000,000.00

100.00

 

 

 

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

=====

+ Also Director



DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. LIM WENG SOON

Address

:

18, TAMAN HUTCHINGS, GREEN LANE, 11600 PULAU PINANG, PULAU PINANG, MALAYSIA.

IC / PP No

:

A2171115

New IC No

:

720425-07-5979

Date of Birth

:

25/04/1972

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

01/01/2014

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 2

 

Name Of Subject

:

MR. KON TED LIUK

Address

:

168-21-03 FETTES RESIDENCES, CONDOMINUM, JALAN TANJUNG TOKONG, 10470 PULAU PINANG, PULAU PINANG, MALAYSIA.

 

 

 

New IC No

:

540928-13-5613

Date of Birth

:

28/09/1954

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

03/01/2005

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 3

 

Name Of Subject

:

DATIN H'NG HSIEH LING

Address

:

15, JALAN TUNKU ABD RAHMAN, 10350 PULAU PINANG, PULAU PINANG, MALAYSIA.

IC / PP No

:

A0359721

New IC No

:

660325-71-5068

Date of Birth

:

25/03/1966

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

09/07/2012

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 4

 

Name Of Subject

:

DATO' H'NG CHUN HSIANG

Address

:

15, JALAN TUNKU ABD RAHMAN, 10350 PULAU PINANG, PULAU PINANG, MALAYSIA.

IC / PP No

:

A1728499

New IC No

:

700802-07-5037

Date of Birth

:

02/08/1970

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

01/10/2010

 

 

 

Qualification

:

BACHELOR OF APPLIED SCIENCE DEGREE IN ELECTRICAL ENGINEERING FROM THE UNIVERSITY OF BRITISH COLUMBIA, VANCOUVER, CANADA IN 1993.

Profile

:

HE BEGAN HIS CAREER AS A MANAGEMENT TRAINEE IN CITIBANK, N.A. HONG KONG. HE JOINED THE LEADER GROUP AS THE PERSONAL ASSISTANT TO THE THEN GROUP MANAGING DIRECTOR. HE WAS APPOINTED AS THE GROUP DIRECTOR, SALES AND MARKETING, IN CHARGE OF THE OVERALL GROUP SALES AND MARKETING FUNCTION FOR CABLE AND WIRE PRODUCTS. HE WAS SUBSEQUENTLY PROMOTED AS THE EXECUTIVE DIRECTOR OF TELECOMMUNICATION AND POWER DIVISION IN 1998. CURRENTLY, HE IS IN CHARGE OF CORPORATE PLANNING AND INVESTMENT OF THE GROUP, A POSITION HE HAS HELD SINCE 2000.

 

 

 

 

DIRECTOR 5

 

Name Of Subject

:

DATO' SERI H'NG BOK SAN @ H'NG AH BA

Address

:

15, JALAN TUNKU ABD RAHMAN, 10350 PULAU PINANG, PULAU PINANG, MALAYSIA.

IC / PP No

:

3087837

New IC No

:

391115-07-5303

Date of Birth

:

15/11/1939

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

01/10/2010

 

 

 

Qualification

:

ATTENDED COURSE N BUSINESS ADMINISTRATION AND ACCOUNTING IN SINGAPORE.

Profile

:

HE BEGAN HIS CAREER AS A MARKETING REPRESENTATIVE FOR AN INTERNATIONAL TRADING COMPANY IN PENANG FOR FOUR YEARS AND SUBSEQUENTLY JOINED A TAIWANESE CABLE MANUFACTURING COMPANY IN SINGAPORE WHERE HE WAS IN CHARGE OF THE SINGAPOREAN AND MALAYSIAN MARKETS. HE HELPED TO SETTING UP OF FEDERAL CABLES WIRE AND METAL MANUFACTURING BHD IN 1967 AND WAS SUBSEQUENTLY PROMOTED TO THE POSITION OF DEPUTY GENERAL MANAGER 3 YEARS LATER AND HELD THE POSITION FOR 5 YEARS.

 

 

 


MANAGEMENT

 

 

 

 

1)

Name of Subject

:

LIM WENG SOON

 

Position

:

DIRECTOR

 

 

AUDITOR

 

Auditor

:

ERNST & YOUNG

Auditor' Address

:

MENARA MILENIUM, JALAN DAMANLELA, PUSAT BANDAR DAMANSARA, DAMANSARA HEIGHTS, LEVEL 23A, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

 

 

COMPANY SECRETARIES

 

 

 

1)

Company Secretary

:

MS. ONG SWAD SARN

 

IC / PP No

:

A0044712

 

New IC No

:

650104-07-5790

 

Address

:

3, LORONG SENTOSA 5, 14000 BUKIT MERTAJAM, PULAU PINANG, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

2)

Company Secretary

:

MR. KON TED LIUK,PKT

 

 

 

 

 

New IC No

:

540928-13-5613

 

Address

:

168-21-03 FETTES RESIDENCES, CONDOMINUM, JALAN TANJUNG TOKONG, 10470 PULAU PINANG, PULAU PINANG, 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

1

19/04/1979

N/A

THE CHASE MANHATAN BANK

MYR 200,000.00

Satisfied

2

04/05/1984

N/A

CHASE MANHATTAN BANK NA

MYR 1,000,000.00

Satisfied

3

12/08/1993

LETTER OF PLEDGE & AGREEMENT

HONGKONG BANK MALAYSIA BHD

MYR 2.00

Satisfied

 

 

LITIGATION 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.

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

 

PAYMENT RECORD

 

 

SOURCES OF RAW MATERIALS:

Local

:

YES

Overseas

:

YES

 

 

 

 

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

 

 

 

Export Market

:

NEW ZEALAND

ASIA

Credit Term

:

N/A

 

 

 

 

 

 

Payment Mode

:

CHEQUES
TELEGRAPHIC TRANSFER (TT)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Products manufactured

:

CABLES

 

 

 

 

Total Number of Employees:

YEAR

2014

 

GROUP

N/A

 

 

 

 

 

 

 

 

COMPANY

200

 

 

 

 

 

 

 

 

 

Branch

:

NO

 

 

Other Information:


The Subject is principally engaged in the (as a / as an) manufacture & sale of cables.

The Subject manufactures high voltage as well as upstream products such as copper and aluminium rods and wires.


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

 

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

07-2381888

Match

:

N/A

 

 

 

Address Provided by Client

:

2 JALAN TAHANA KAWASAN PERINDUSTRIA TAMPOI 81200 JOHAR BAHRA JOHOR

Current Address

:

2, JALAN TAHANA, KAWASAN PERINDUSTRIAN TAMPOI, 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

[

14.75%

]

 

Profit/(Loss) Before Tax

:

Increased

[

21.76%

]

 

Return on Shareholder Funds

:

Favourable

[

30.25%

]

 

Return on Net Assets

:

Acceptable

[

26.52%

]

 

 

 

 

 

 

 

 

The lower turnover could be due to the intense market competition.The Subject's management have been efficient in controlling its operating costs. 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.

 

 

 

 

 

 

 

Liquidity

 

 

 

 

 

 

Current Ratio

:

Unfavourable

[

0.84 Times

]

 

 

 

 

 

 

 

 

Due to its weak liquidity position, the Subject will be faced with problems in meeting all its short term obligations if no short term loan is obtained or additional capital injected into the Subject.

 

 

 

 

 

 

 

Solvency

 

 

 

 

 

 

Liability Ratio

:

Unfavourable

[

6.55 Times

]

 

 

 

 

 

 

 

 

The Subject has high liabilities ratio and it may face financial difficulties if no additional capital is injected.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall Assessment :

 

 

 

 

 

 

Due to the efficient control of its operating costs, the Subject was able to remain profitable despite lower turnover achieved during the year. The Subject's liquidity was at an acceptable range. If the Subject is able to obtain further short term financing, it should be able to meet all its short term obligations. The Subject's liabilities 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 : FAIR

 

 

 

 

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

27320 : Manufacture of other electronic and electric wires and cables

 

 

INDUSTRY :

MANUFACTURING

 

 

 

The manufacturing sector is expected to grow by 5.5% in 2015. It will be bolstered by strong domestic and export-oriented industries in line with growing investment activities and favorable external demand. Moreover, in 2014, the manufacturing sectors have spearheading growth. The manufacturing sector is estimated to grow at a faster pace in 2014 on higher exports of electronics and electrical (E&E) products as external demand improves.

 

The manufacturing sector expanded strongly during the first half of 2014, the highest growth in three years, spurred by higher global semiconductor sales. Value-added of the manufacturing sector expanded 7.1% during the first half of 2014. Production of the sector rose 6.6% in the first seven months of 2014 supported by resilient domestic demand and recovery in the external sector during the first seven months of the years. The sales value of manufactured products rebounded by 7.7% in the first seven months of 2014. The strong performance of the sector was on account of higher output at 9.4% from the domestic-oriented industries, particularly transport equipment, food and beverage.

 

The manufacturing sector continued to attract domestic and foreign investment with investment approved by Malaysian Investment Development Authority (MIDA) totaling RM47.4 billion during the first six months of 2014, mainly from Japan, China and Germany. Meanwhile, the capacity utilization rate remained steady at 80.4% during the second quarter of 2014 while average wage per employee and productivity improved to RM2,772 per month and 5.9%, respectively during the first seven months of 2014. Boosted by favorable domestic economic activity and recovery in the external sector, the manufacturing sector is expected to record a better performance with growth of 6.4% in 2014.

 

In the meantime, production of wood products rebounded by 5.1% largely supported by higher output in the saw-milling and planning of wood segment at 25.9% during the first seven months of 2014. The positive performance was attributed to vibrant residential and commercial construction activities which contributed to increased use of timber frame and glued laminated timber for cost savings compared to the use of concrete and steel. Increased demand from major export destination such as the US, Japan and Australia for Malaysian made furniture contributed to the higher output, particularly wooden and cane furniture which rebounded by 2.2%.

 

Production of rubber products contracted 0.3% in the first seven months of 2014 on account of slower demand for rubber gloves and rubber tyres. The decline in rubber tyres for vehicles was due to the weaker external demand from the automotive industry, particularly from China. Output of other rubber products contracted 3.8% following the product shift from rubber-based to plastics, silicones and metal alloys in the manufacture of medical devices.

 

Besides, exports of manufactured products are expected to grow 6.1% in 2014 boosted by the growing demand from advanced economies. However, during the first seven months of 2014, manufactured exports surged 11.4%. The robust growth was buoyed by strengthening demand in the US and EU, reflecting significant exposure of Malaysian exports to the economic performance in the advance economies. The strength in export was broad-based with robust growth in both E&E and non- E&E subsectors.

 

Under budget 2015, the Government will provide incentive in the form of capital allowance on automation expenditure to encourage automation in the manufacturing sector, which may help in the manufacturing sector.

 

 

OVERALL INDUSTRY OUTLOOK : Average Growth



CREDIT RISK EVALUATION & RECOMMENDATION

 

 


Incorporated in 1977, the Subject is a Private Limited company, focusing on manufacture & sale of cables. 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. The Subject is a large entity with strong capital position of MYR 22,000,000. We are confident with the Subject's business and its future growth prospect. Having strong support from its shareholder has enabled the Subject to remain competitive despite the challenging business environment.

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. The Subject is a fairly large and rapidly growing company with over 200 staff in its operations 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.

We noted that both the turnover and profits have increased compared to the previous year. The higher profit could be due to increase in turnover and better control over its operating costs. Return on shareholders' funds of the Subject was at a favourable range which indicated that the management was efficient in utilising its funds to generate income. Due to its weak liquidity position, the Subject may face working capital deficiency in meeting its short term financial obligations if no fresh capital are injected into the Subject. The Subject has high liabilities ratio and it may face financial difficulties if no additional capital is injected. Given a positive net worth standing at MYR 24,922,000, the Subject should be able to maintain its business in the near terms.

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 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 normally.

 

 

 

PROFIT AND LOSS ACCOUNT

 

 

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

LEADER UNIVERSAL ALUMINIUM SDN. BHD.

 

Financial Year End

2013-12-31

2012-12-31

2011-12-31

2010-12-31

2009-12-31

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

SUMMARY

SUMMARY

SUMMARY

SUMMARY

SUMMARY

Currency

MYR

MYR

MYR

MYR

MYR

 

 

 

 

 

 

TURNOVER

500,473,000

587,046,000

-

-

-

 

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

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

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

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

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

Total Turnover

500,473,000

587,046,000

-

-

-

 

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

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

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

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

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

 

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

11,581,000

9,511,000

(981,763)

(812,276)

(828,136)

 

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

11,581,000

9,511,000

(981,763)

(812,276)

(828,136)

Taxation

(4,708,000)

(1,735,000)

0

-

-

 

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

6,873,000

7,776,000

(981,763)

(812,276)

(828,136)

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

 

As previously reported

(2,442,845)

(10,218,845)

(9,237,082)

(8,424,806)

(7,596,670)

 

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

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

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

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

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

As restated

(2,442,845)

(10,218,845)

(9,237,082)

(8,424,806)

(7,596,670)

 

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

4,430,155

(2,442,845)

(10,218,845)

(9,237,082)

(8,424,806)

DIVIDENDS - Ordinary (paid & proposed)

(3,713,000)

-

-

-

-

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

717,155

(2,442,845)

(10,218,845)

(9,237,082)

(8,424,806)

 

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

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

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

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

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

 

 

 

 

 

 

 

 

 

BALANCE SHEET

 

 

LEADER UNIVERSAL ALUMINIUM SDN. BHD.

 

ASSETS EMPLOYED:

 

 

 

 

 

FIXED ASSETS

53,746,000

39,657,000

4,772,380

4,772,380

4,711,018

 

 

 

 

 

 

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

10,671,000

-

-

-

-

 

 

 

 

 

 

 

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

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

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

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

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

TOTAL LONG TERM ASSETS

64,417,000

39,657,000

4,772,380

4,772,380

4,711,018

 

 

 

 

 

 

TOTAL CURRENT ASSETS

107,115,000

122,770,000

107,061

107,041

107,121

 

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

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

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

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

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

TOTAL ASSET

171,532,000

162,427,000

4,879,441

4,879,421

4,818,139

 

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

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

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

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

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

 

 

 

 

 

 

TOTAL CURRENT LIABILITIES

127,858,000

141,689,000

7,764,734

6,382,151

5,107,793

 

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

(20,743,000)

(18,919,000)

(7,657,673)

(6,275,110)

(5,000,672)

 

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

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

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

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

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

TOTAL NET ASSETS

43,674,000

20,738,000

(2,885,293)

(1,502,730)

(289,654)

 

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

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

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

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

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

 

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

 

Ordinary share capital

22,000,000

22,000,000

7,000,000

7,000,000

7,000,000

 

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

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

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

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

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

TOTAL SHARE CAPITAL

22,000,000

22,000,000

7,000,000

7,000,000

7,000,000

 

 

 

 

 

 

Retained profit/(loss) carried forward

717,155

(2,442,845)

(10,218,845)

(9,237,082)

(8,424,806)

 

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

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

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

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

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

TOTAL RESERVES

717,155

(2,442,845)

(10,218,845)

(9,237,082)

(8,424,806)

 

 

 

 

 

 

 

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

22,717,155

19,557,155

(3,218,845)

(2,237,082)

(1,424,806)

 

 

 

 

 

 

TOTAL LONG TERM LIABILITIES

20,956,845

1,180,845

333,552

734,352

1,135,152

 

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

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

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

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

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

 

43,674,000

20,738,000

(2,885,293)

(1,502,730)

(289,654)

 

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

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

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

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

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

 

 

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

LEADER UNIVERSAL ALUMINIUM SDN. BHD.

 

TYPES OF FUNDS

 

 

 

 

 

Net Liquid Assets

(20,743,000)

(18,919,000)

(7,657,673)

(6,275,110)

(5,000,672)

Net Current Assets/(Liabilities)

(20,743,000)

(18,919,000)

(7,657,673)

(6,275,110)

(5,000,672)

Net Tangible Assets

43,674,000

20,738,000

(2,885,293)

(1,502,730)

(289,654)

Net Monetary Assets

(41,699,845)

(20,099,845)

(7,991,225)

(7,009,462)

(6,135,824)

 

 

 

 

 

 

BALANCE SHEET ITEMS

 

 

 

 

 

Total Liabilities

148,814,845

142,869,845

8,098,286

7,116,503

6,242,945

Total Assets

171,532,000

162,427,000

4,879,441

4,879,421

4,818,139

Net Assets

43,674,000

20,738,000

(2,885,293)

(1,502,730)

(289,654)

Net Assets Backing

22,717,155

19,557,155

(3,218,845)

(2,237,082)

(1,424,806)

Shareholders' Funds

22,717,155

19,557,155

(3,218,845)

(2,237,082)

(1,424,806)

Total Share Capital

22,000,000

22,000,000

7,000,000

7,000,000

7,000,000

Total Reserves

717,155

(2,442,845)

(10,218,845)

(9,237,082)

(8,424,806)

 

 

 

 

 

 

LIQUIDITY (Times)

 

 

 

 

 

Current Ratio

0.84

0.87

0.01

0.02

0.02

 

 

 

 

 

 

SOLVENCY RATIOS (Times)

 

 

 

 

 

Liabilities Ratio

6.55

7.31

(2.52)

(3.18)

(4.38)

Assets Backing Ratio

1.99

0.94

(0.41)

(0.21)

(0.04)

 

 

 

 

 

 

PERFORMANCE RATIO (%)

 

 

 

 

 

Operating Profit Margin

2.31

1.62

-

-

-

Net Profit Margin

1.37

1.32

-

-

-

Return On Net Assets

26.52

45.86

34.03

54.05

285.91

Return On Capital Employed

26.52

45.86

34.03

54.05

285.91

Return On Shareholders' Funds/Equity

30.25

39.76

30.50

36.31

58.12

Dividend Pay Out Ratio (Times)

0.54

-

-

-

-

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.62.44

UK Pound

1

Rs.98.15

Euro

1

Rs.77.38

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

Report Prepared by :

MNL

 

               

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.