MIRA INFORM REPORT

 

 

Report Date :

28.02.2014

 

IDENTIFICATION DETAILS

 

Name :

QL FEED SDN. BHD.

 

 

Formerly Known As :

QL DISTRIBUTION SDN BHD

 

 

Registered Office :

16A, Jalan Astaka U8/83, Bukit Jelutong, 40150 Shah Alam, Selangor,

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.03.2013

 

 

Date of Incorporation :

16.05.2001

 

 

Com. Reg. No.:

547781-V

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Subject is principally engaged in the distribution of animal feed raw material and food grain

 

 

No. of Employees :

40 [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 – September 30, 2013

 

Country Name

Previous Rating

(30.06.2013)

Current Rating

(30.09.2013)

Malaysia

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 


 

MALAYSIA - ECONOMIC OVERVIEW

 

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

 

Source : CIA

 

 

 

 


EXECUTIVE SUMMARY

 

REGISTRATION NO.

:

547781-V

COMPANY NAME

:

QL FEED SDN. BHD.

FORMER NAME

:

QL DISTRIBUTION SDN BHD (22/05/2007)
CSM DISTRIBUTION SDN BHD (10/06/2003)

INCORPORATION DATE

:

16/05/2001

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

16A, JALAN ASTAKA U8/83, BUKIT JELUTONG, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

BUSINESS ADDRESS

:

16A, JALAN ASTAKA U8/83, BUKIT JELUTONG, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

TEL.NO.

:

03-78012282

FAX.NO.

:

03-78012226

WEB SITE

:

WWW.QL.COM.MY

CONTACT PERSON

:

CHIA SONG KUN ( MANAGING DIRECTOR )

INDUSTRY CODE

:

46902

PRINCIPAL ACTIVITY

:

DISTRIBUTION OF ANIMAL FEED RAW MATERIAL AND FOOD GRAIN

AUTHORISED CAPITAL

:

MYR 50,000,000.00 DIVIDED INTO
ORDINARY SHARE 50,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 26,000,000.00 DIVIDED INTO
ORDINARY SHARES 2 CASH AND 25,999,998 OTHERWISE OF MYR 1.00 EACH.

SALES

:

MYR 950,196,000 [2013]

NET WORTH

:

MYR 76,309,000 [2013]

M1000 OVERALL RANKING

:

517[2011]

M1000 INDUSTRY RANKING

:

2[2011]

STAFF STRENGTH

:

40 [2014]

BANKER (S)

:

RHB BANK BHD

LITIGATION

:

TRACED

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

FAIR

PAYMENT

:

PROMPT

MANAGEMENT CAPABILITY

:

AVERAGE

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) distribution of animal feed raw material and food grain.

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

 

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

YEAR

2011

2009

OVERALL RANKING

517

568

INDUSTRY RANKING

2

3

 

The immediate holding company of the Subject is QL FEEDINGSTUFFS SDN. BHD., a company incorporated in MALAYSIA.

The ultimate holding company of the Subject is QL RESOURCES BERHAD, a company incorporated in MALAYSIA.

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

15/02/2013

MYR 50,000,000.00

MYR 26,000,000.00

 

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

 

Name

Address

IC/PP/Loc No

Shareholding

(%)

QL FEEDINGSTUFFS SDN. BHD.

16A, JALAN ASTAKA U8/83, BUKIT JELUTONG, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

147366A

26,000,000.00

100.00

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

------

26,000,000.00

100.00

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

=====

+ Also Director



DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. CHIA SEONG POW

Address

:

19, JALAN KELAB GOLF 13/3, SEKSYEN 13, 40000 SHAH ALAM, SELANGOR, MALAYSIA.

IC / PP No

:

4863224

New IC No

:

550909-10-6285

Date of Birth

:

09/09/1955

Nationality

:

MALAYSIAN

Date of Appointment

:

01/06/2001

Qualification

:

DIP IN BUILDING TECHNOLOGY FROM TUANKU ABDUL RAHMAN COLLEGE

Profile

:

MORE THAN 15 YEARS OF EXPERIENCE IN THE LIVESTOCK & FOOD INDUSTRY COVERING LAYER FARMING, MANUFACTURING, TRADING & SHIPPING

 

DIRECTOR 2

 

Name Of Subject

:

MR. CHIA SONG SWA

Address

:

8, JALAN SETIA NUSANTARA U13/19B, SETIA ECO PARK, SETIA ALAM, SECTION U13, 40170 SHAH ALAM, SELANGOR, MALAYSIA.

IC / PP No

:

5886688

New IC No

:

600215-10-5723

Date of Birth

:

15/02/1960

Nationality

:

MALAYSIAN

Date of Appointment

:

24/05/2007

Qualification

:

DEGREE IN CHEMISTRY & STATISTICS FROM UNIVERSITY OF CAMPBELL

Profile

:

MGTE TRAINEE AT GENTING BHD FROM 1984-1986 JOINED QL RESOURCES AS A SALES EXE IN 1987 12 YEARS EXPERIENCE IN FEED RAW MATERIAL DISTRIBUTION

 

DIRECTOR 3

 

Name Of Subject

:

MR. CHIA SONG KUN

Address

:

17, JALAN KELAB GOLF 13/3, SEKSYEN 13, 40000 SHAH ALAM, SELANGOR, MALAYSIA.

IC / PP No

:

2301518

New IC No

:

491208-10-6007

Date of Birth

:

08/12/1949

Nationality

:

MALAYSIAN

Date of Appointment

:

01/06/2001

Qualification

:

B.SC (HONOURS) IN MATHEMATICS, UM IN 1972 & M.B.A., UM IN 1988.

Profile

:

TUTOR IN UM IN 1973 & LECTURER AT ITM FOR 11 YEARS UNTIL 1984 INCORPORATE CBG HOLDING SDN BHD IN 1984 TO COMMENCE THE BUSS OF DISTRIBUTING FISHMEAL & OTHER FEED-MEAL RAW MATERIALS

Other Info

:

ACTIVE IN KLANG CHINESE CHAMBER OF COMMERCE & INDUSTRY WHERE HEAD OF THE COMMERCE COMMITTEE SINCE EARLY 1999

 

DIRECTOR 4

 

Name Of Subject

:

MR. CHIA MAK HOOI

Address

:

29, JALAN KUBAH U8/59, BUKIT JELUTONG, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

IC / PP No

:

A0187626

New IC No

:

650605-08-6113

Date of Birth

:

05/06/1965

Nationality

:

MALAYSIAN

Date of Appointment

:

02/06/2003

Qualification

:

DEGREE IN ACCOUNTING & FINANCE FROM ARIZONA STATE UNIVERSITY IN 1988

Profile

:

WITH LOCAL AUDIT FIRM IN LOS ANGELASFOR 1 YEAR JOINED CONCEPT ENTERPRISES INC. USA AS AN ASSISTANT ACCOUNTANT FOR 2 YEARS JOINED QL FEEDINGSTUFFS SDN BHD AS FINANCE MANAGER IN 1991



MANAGEMENT

 

1)

Name of Subject

:

CHIA SONG KUN

Position

:

MANAGING DIRECTOR

 

2)

Name of Subject

:

CHIA SONG SWA

Position

:

SALES DIRECTOR

 

3)

Name of Subject

:

JOSK SUI

Position

:

HEAD OF HUMAN RESOURCE

 

4)

Name of Subject

:

YVONNE NG

Position

:

GENERAL SECRETARY

 

 

AUDITOR

 

Auditor

:

KPMG

Auditor' Address

:

KPMG TOWER, 8, FIRST AVENUE, BANDAR UTAMA, LEVEL 10, 47800 PETALING JAYA, SELANGOR, MALAYSIA.

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. NG GEOK PING

IC / PP No

:

A1165996

New IC No

:

681230-10-6772

Address

:

29, JALAN MERBUK 3, BANDAR PUCHONG JAYA, 47100 PUCHONG, SELANGOR, MALAYSIA.

 

2)

Company Secretary

:

MS. WEE PEK SAW

IC / PP No

:

A2781595

New IC No

:

740710-03-5050

Address

:

37, JALAN BP14/3, BANDAR BUKIT PUCHONG 2, 47120 PUCHONG, SELANGOR, MALAYSIA.

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

RHB BANK BHD

 

 

ENCUMBRANCE (S)


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

 

 

LEGAL CHECK AGAINST SUBJECT


* A check has been conducted in our databank against the Subject whether the subject has been involved in any litigation.

LEGAL ACTION

 

 

Code No

:

22

Case No

:

1061

Year

:

2004

Place

:

KUALA LUMPUR

Court

:

HIGH COURT

Solicitor

:

CHEW BIMAN & CO

Solicitor Tel. No.

:

03-20787544/5712

Plaintiff

:

MOM MARKETING SDN BHD

Defendants

:

QL DISTRIBUTION SDN BHD (547781)

5 LRG BKT KUDA, OFF JLN BT 3 LAMA, 41300 KLANG, SELANGOR, MALAYSIA.

Amount Claimed

:

3000000.62

Nature of Claim

:

GDS SOLD & DELIVERED

Remark

:

LIST

 

NOTE:

Please check with creditors for confirmation as alleged debts may have been paid since recorded or are being disputed. The person wo has been sued has the same name as the subject. However, we are unable to determine whether the person sued is the one and the same person.

 

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

Percentage

:

40%

Overseas

:

YES

Percentage

:

60%


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

[

X

]

Good 31-60 Days

[

]

Average 61-90 Days

[

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]



CLIENTELE

 

Local

:

YES

Percentage

:

100%

Domestic Markets

:

MALAYSIA

Overseas

:

NO

Credit Term

:

30 DAYS

Payment Mode

:

CHEQUES

Type of Customer

:

END USERS,RETAIL

 

 

OPERATIONS

 

Goods Traded

:

ANIMAL FEED RAW MATERIALS AND FOOD GRAIN

Competitor(s)

:

DANBERG (M) SDN. BHD.
GLADRON CHEMICALS SDN. BHD.
PERKHIDMATAN KARGO TUMPATAN SDN BHD
PETERLABS SDN BHD
RITMA PRESTASI SDN BHD

Member(s) / Affiliate(s)

:

MALAYSIA EXTERNAL TRADE DEVELOPMENT CORPORATION (MATRADE)

MALAYSIA FOOD & BEVERAGE INDUSTRY

Ownership of premises

:

OWNED

 

Total Number of Employees:

 

YEAR

2014

2013

2012

2011

2010


GROUP

N/A

N/A

N/A

N/A

N/A

COMPANY

40

40

40

35

33

 

Branch

:

NO

Other Information:


The Subject is principally engaged in the (as a / as an) distribution of animal feed raw material and food grain.

We were informed that the Subject is under the QL Resources Group of Companies.

The QL Group is a diversified agri-based group of companies. The Group is principally involved in marine products manufacturing, integrated livestock farming and oil palm related activities.

According to the Subject, it offers a wide range of raw materials for animal feed.

The products are including corn, fish meal, soya bean and others.

 

CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

03-78012282

Match

:

N/A

Address Provided by Client

:

16 A JALAN ASTAKA U8/83 BUKIT JELUTONG 40150 SHAH ALAM SELANGOR DARUL EHSAN

Current Address

:

16A, JALAN ASTAKA U8/83, BUKIT JELUTONG, 40150 SHAH ALAM, 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

:

Increased

[

2009 - 2013

]

Profit/(Loss) Before Tax

:

Increased

[

2009 - 2013

]

Return on Shareholder Funds

:

Favourable

[

32.33%

]

Return on Net Assets

:

Favourable

[

48.68%

]

The Subject's turnover increased steadily as the demand for its products / services increased due to the goodwill built up over the years.The higher profit could be attributed to the increase in turnover. 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

[

14 Days

]

Debtor Ratio

:

Favourable

[

32 Days

]

Creditors Ratio

:

Favourable

[

2 Days

]

The Subject's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. The favourable debtors' days could be due to the good credit control measures implemented by the 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

[

1.20 Times

]

Current Ratio

:

Unfavourable

[

1.38 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

:

Acceptable

[

6.93 Times

]

Gearing Ratio

:

Unfavourable

[

2.24 Times

]

The Subject's interest cover was slightly low. If there is no sharp fall in its profit or sudden increase in the interest rates, we believe the Subject is able to generate sufficient income to service its interest and repay the loans. 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 :

Generally, the Subject's performance has improved with higher turnover and profit. 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 had an acceptable interest cover. If there is no sudden sharp increase in interest rate or fall in the Subject's profit, we do believe the Subject is able to generate sufficient cash flow to service its interest payment. 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 : FAIR

 

 

MALAYSIA ECONOMIC / INDUSTRY OUTLOOK

 

Major Economic Indicators:

2009

2010

2011

2012*

2013**

Population ( Million)

28.13

28.35

28.70

29.30

29.80

Gross Domestic Products ( % )

(0.5)

7.2

5.1

5.6

5.3

Domestic Demand ( % )

2.9

6.3

8.2

9.4

5.6

Private Expenditure ( % )

(2.7)

8.1

8.2

8.0

7.4

Consumption ( % )

0.7

6.7

7.1

1.0

5.7

Investment ( % )

(17.2)

17.7

12.2

11.7

13.3

Public Expenditure ( % )

5.2

3.8

8.4

13.3

1.2

Consumption ( % )

3.1

0.2

16.1

11.3

(1.2)

Investment ( % )

8.0

2.8

(0.3)

15.9

4.2

Balance of Trade ( MYR Million )

89,650

118,356

116,058

106,300

110,700

Government Finance ( MYR Million )

(28,450)

(40,482)

(45,511)

(42,297)

(39,993)

Government Finance to GDP / Fiscal Deficit ( % )

(4.8)

(5.6)

(5.4)

(4.5)

(4.0)

Inflation ( % Change in Composite CPI)

(5.2)

5.1

3.1

1.6

2.5

Unemployment Rate

4.5

3.9

3.3

3.2

3.0

Net International Reserves ( MYR Billion )

331

329

415

427

-

Average Risk-Weighted Capital Adequacy Ratio ( % )

2.87

2.20

3.50

2.20

-

Average 3 Months of Non-performing Loans ( % )

11.08

15.30

14.80

14.70

-

Average Base Lending Rate ( % )

5.53

6.30

6.60

6.53

-

Business Loans Disbursed( % )

10.5

14.7

15.3

32.2

-

Foreign Investment ( MYR Million )

22,156.8

22,517.9

23,546.1

26,230.4

-

Consumer Loans ( % )

-

-

-

-

-

Registration of New Companies ( No. )

41,578

44,148

45,455

45,441

-

Registration of New Companies ( % )

(0.1)

6.2

3.0

(0.0)

-

Liquidation of Companies ( No. )

39,075

25,585

132,476

-

-

Liquidation of Companies ( % )

39.6

(34.5)

417.8

-

-

Registration of New Business ( No. )

312,581

271,414

284,598

324,761

-

Registration of New Business ( % )

-

-

-

-

-

Business Dissolved ( No. )

19,345

19,738

20,121

-

-

Business Dissolved ( % )

2.4

2.0

1.9

-

-

Sales of New Passenger Cars (' 000 Unit )

486.3

543.6

535.1

552.2

-

Cellular Phone Subscribers ( Million )

30.1

32.8

35.3

38.5

-

Tourist Arrival ( Million Persons )

23.6

24.6

24.7

25.0

-

Hotel Occupancy Rate ( % )

58.0

63.0

60.6

62.4

-

Credit Cards Spending ( % )

12.8

14.1

15.6

12.6

-

Bad Cheque Offenders (No.)

36,667

33,568

32,627

26,982

-

Individual Bankruptcy ( No.)

16,228

18,119

19,167

19,575

-

Individual Bankruptcy ( % )

16.7

11.7

5.8

2.1

-

 

INDUSTRIES ( % of Growth ):

2009

2010

2011

2012*

2013**

Agriculture

0.4

2.1

5.9

0.6

2.4

Palm Oil

(1.1)

(3.4)

10.8

(2.8)

-

Rubber

(19.8)

9.9

6.1

(0.6)

-

Forestry & Logging

(5.9)

(3.3)

(7.6)

(2.2)

-

Fishing

5.5

5.6

2.1

(0.7)

-

Other Agriculture

9.0

7.9

7.1

6.4

-

Industry Non-Performing Loans ( MYR Million )

413.7

508.4

634.1

-

-

% of Industry Non-Performing Loans

1.3

2.1

3.2

-

-

Mining

(3.8)

0.2

(5.7)

1.5

2.7

Oil & Gas

2.1

0.5

(1.7)

-

-

Other Mining

-

-

-

-

-

Industry Non-performing Loans ( MYR Million )

44.2

49.7

46.5

-

-

% of Industry Non-performing Loans

0.1

0.1

0.1

-

-

Manufacturing #

(9.4)

11.4

4.7

4.2

4.9

Exported-oriented Industries

(19.0)

12.1

2.8

4.1

-

Electrical & Electronics

(30.3)

28.4

(4.9)

1.6

-

Rubber Products

(10.1)

25.3

15.4

3.6

-

Wood Products

(24.1)

20.1

(4.9)

4.6

-

Textiles & Apparel

(19.5)

(0.4)

14.8

(7.1)

-

Domestic-oriented Industries

(9.8)

16.3

6.5

8.6

-

Food, Beverages & Tobacco

0.2

3.0

4.2

-

-

Chemical & Chemical Products

(7.7)

16.2

5.5

9.9

-

Plastic Products

(9.1)

2.4

3.8

-

-

Iron & Steel

(32.7)

29.3

2.4

-

-

Fabricated Metal Products

(2.5)

14.9

25.2

-

-

Non-metallic Mineral

(15.5)

20.2

27.1

6.6

-

Transport Equipment

(13.5)

36.5

(10.4)

13.7

-

Paper & Paper Products

(5.0)

18.7

14.8

(7.8)

-

Crude Oil Refineries

0.2

(11.4)

9.3

-

-

Industry Non-Performing Loans ( MYR Million )

6,007.3

6,217.5

6,537.2

-

-

% of Industry Non-Performing Loans

18.3

23.8

25.7

-

-

Construction

5.8

5.1

4.4

15.5

11.2

Industry Non-Performing Loans ( MYR Million )

3,241.8

4,038.5

3,856.9

-

-

% of Industry Non-Performing Loans

9.9

10.7

10.2

-

-

Services

2.6

6.5

6.4

5.5

5.6

Electric, Gas & Water

0.4

8.5

5.6

4.8

-

Transport, Storage & Communication

1.6

7.7

6.5

7.3

-

Wholesale, Retail, Hotel & Restaurant

2.8

4.7

5.2

6.9

-

Finance, Insurance & Real Estate

3.8

6.1

6.3

6.5

-

Government Services

2.0

6.7

7.6

5.6

-

Other Services

4.4

4.2

5.4

5.7

-

Industry Non-Performing Loans ( MYR Million )

6,631.3

7,384.6

6,825.2

-

-

% of Industry Non-Performing Loans

20.2

25.7

23.4

-

-

* Estimate / Preliminary

** Forecast



INDUSTRY ANALYSIS

 

MSIC CODE

46902 : Wholesale of animal/pet food

INDUSTRY :

TRADING

According to the Retail Group Malaysia (RGM), the wholesale and retail trade sector forecast to grow to 6% in year 2013. During the first quarter of year 2013, RGM is estimating the retail industry to grow 6.9%. Many retailers have been enjoying better sales since the government handed out cash from mid-January of 2013 under the second round of Bantuan Rakyat 1Malaysia to more than 12 million Malaysians. Bookstores and related retail stores have also started enjoying rising sales since the RM250 1Malaysia Book Voucher was distributed to 1.3 million private and public university students. Besides, since early February 2013, handphone traders and retailers selling smartphone accessories have started to benefit from the RM200 rebate on smartphones for 1.5 million young adults aged between 21 and 30 years with a monthly income of not more than RM3,000.

The wholesale and retail trade sector grew 6.1% in the first half of the year 2012 driven by strong domestic consumption and the increasing number of large format stores operating in Malaysia, including 180 foreign hypermarkets, superstores and departmental stores as at end of August 2012. In addition, other indicators such as imports of consumption goods were higher by 15.2%.

In 2012, the wholesale and retail trade sector growth to 5.5% driven by higher consumption which benefited from Government initiatives under the 2012 Budget such as BR1M, Baucar Buku 1Malaysia (BB1M) and the RM100 assistance for all primary and secondary school students. The performance of the sector will also be supported by ongoing efforts to modernise the retail segment under the ETP. In 2012, 500 retail shops and 50 workshops are targeted to be modernised under the Retail Shop Transformation (TUKAR) and Automotive Workshop Modernisation (ATOM) programmes, respectively. As at end of July 2012, 95 workshops have been modernised, surpassing the yearly target, while 393 retail shops have been modernised.

Growth of the sector is anticipated to remain encouraging with ongoing efforts by the Government to increase its contribution to the economy. Major initiatives include increasing the number of large format stores such as hypermarkets, superstores and departmental stores are carried out to boost the economy.

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 2001, the Subject is a Private Limited company, focusing on distribution of animal feed raw material and food grain. Having been in the industry for over a decade, the Subject has achieved a certain market share and has built up a satisfactory reputation in the market. It should have received supports from its regular customers. Having strong support from its holding company has enabled the Subject to remain competitive despite the challenging business environment. The Subject is a large entity with strong capital position. We are confident with the Subject's business and its future growth prospect.

Over the years, the Subject should have build up its clientele base and received supports from its regular customers. Investigation revealed that the Subject's interest lies mostly in the local market. Thus, any adverse changes to the local economy might have a negative impact on the Subject's business performance. The Subject has approximately 40 employees in its business operations. Overall, we regard that the Subject's management capability is average. This indicates that the Subject has greater potential to improve its business performance and raising income for the Subject.

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. 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. Nevertheless, given a positive net worth standing at MYR 76,309,000, 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.

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

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)

QL FEED SDN. BHD.

 

Financial Year End

2013-03-31

2012-03-31

2011-03-31

2010-03-31

2009-03-31

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

950,196,000

794,157,000

792,339,000

677,882,757

635,430,045

Other Income

3,546,000

3,672,000

2,116,000

7,902,161

-

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

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

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

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

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

Total Turnover

953,742,000

797,829,000

794,455,000

685,784,918

635,430,045

Costs of Goods Sold

(911,517,000)

(773,941,000)

(749,747,000)

(650,438,943)

-

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

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

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

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

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

Gross Profit

42,225,000

23,888,000

44,708,000

35,345,975

-

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

31,787,000

15,482,000

36,345,000

29,223,794

16,308,091

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

31,787,000

15,482,000

36,345,000

29,223,794

16,308,091

Taxation

(7,114,000)

(3,091,000)

(8,135,000)

(5,217,275)

(3,416,438)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

24,673,000

12,391,000

28,210,000

24,006,519

12,891,653

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

24,573,000

26,286,000

1,006,986

(14,910,733)

(25,332,386)

Prior year adjustment

-

-

11,014

-

-

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

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

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

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

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

As restated

24,573,000

26,286,000

1,018,000

(14,910,733)

(25,332,386)

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

49,246,000

38,677,000

29,228,000

9,095,786

(12,440,733)

DIVIDENDS - Ordinary (paid & proposed)

(6,822,000)

(14,104,000)

(2,942,000)

(8,088,800)

(2,470,000)

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

42,424,000

24,573,000

26,286,000

1,006,986

(14,910,733)

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Bank overdraft

2,000

1,000

1,000

1,037

22,721

Bankers' acceptance

5,213,000

4,726,000

-

-

-

Loan from holding company

98,000

31,000

61,000

65,152

-

Revolving loans

49,000

-

-

-

-

Others

-

-

3,217,000

2,486,494

6,213,194

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

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

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

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

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

5,362,000

4,758,000

3,279,000

2,552,683

6,235,915

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

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

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

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

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

 


 

BALANCE SHEET

 

QL FEED SDN. BHD.

 

ASSETS EMPLOYED:

FIXED ASSETS

1,127,000

2,684,000

3,096,000

3,750,015

9,261,021

LONG TERM INVESTMENTS/OTHER ASSETS

Subsidiary companies

-

-

-

2

-

Investment properties

612,000

867,000

1,147,000

1,300,376

6,260,623

Deferred assets

29,000

65,000

559,000

573,000

894,000

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

641,000

932,000

1,706,000

1,873,378

7,154,623

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

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

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

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

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

TOTAL LONG TERM ASSETS

1,768,000

3,616,000

4,802,000

5,623,393

16,415,644

CURRENT ASSETS

Short term quoted/unquoted investments

-

11,496,000

13,483,000

-

-

Stocks

35,472,000

30,097,000

39,516,000

34,321,646

33,547,345

Trade debtors

83,706,000

51,441,000

130,734,000

34,307,088

36,002,586

Other debtors, deposits & prepayments

1,864,000

1,948,000

2,066,000

1,568,950

4,787,081

Short term deposits

-

2,901,000

6,000,000

7,000,384

11,242,949

Amount due from holding company

14,545,000

6,409,000

6,405,000

2,106,456

-

Amount due from subsidiary companies

-

-

1,682,000

2,240

-

Amount due from related companies

116,235,000

72,742,000

1,110,000

55,348,500

49,163,241

Cash & bank balances

19,791,000

18,030,000

15,194,000

6,329,351

7,417,920

Others

345,000

919,000

37,000

40,248,250

-

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

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

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

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

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

TOTAL CURRENT ASSETS

271,958,000

195,983,000

216,227,000

181,232,865

142,161,122

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

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

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

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

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

TOTAL ASSET

273,726,000

199,599,000

221,029,000

186,856,258

158,576,766

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

5,135,000

2,181,000

17,058,000

7,346,188

7,587,089

Other creditors & accruals

1,931,000

1,225,000

1,013,000

909,195

1,090,882

Bill & acceptances payable

170,974,000

127,708,000

139,324,000

113,480,257

105,566,555

Amounts owing to holding company

5,528,000

-

185,000

-

-

Amounts owing to related companies

11,919,000

9,738,000

29,000

11,712,167

8,880,724

Provision for taxation

1,930,000

-

2,924,000

1,850,000

1,035,716

Other liabilities

-

-

210,000

413,730

320,975

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

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

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

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

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

TOTAL CURRENT LIABILITIES

197,417,000

140,852,000

160,743,000

135,711,537

124,481,941

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

74,541,000

55,131,000

55,484,000

45,521,328

17,679,181

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

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

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

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

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

TOTAL NET ASSETS

76,309,000

58,747,000

60,286,000

51,144,721

34,094,825

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

26,000,000

26,000,000

26,000,000

26,000,000

26,000,000

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

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

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

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

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

TOTAL SHARE CAPITAL

26,000,000

26,000,000

26,000,000

26,000,000

26,000,000

RESERVES

Share premium

8,000,000

8,000,000

8,000,000

8,000,000

8,000,000

General reserve

(115,000)

174,000

-

-

-

Retained profit/(loss) carried forward

42,424,000

24,573,000

26,286,000

1,006,986

(14,910,733)

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

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

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

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

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

TOTAL RESERVES

50,309,000

32,747,000

34,286,000

9,006,986

(6,910,733)

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

76,309,000

58,747,000

60,286,000

35,006,986

19,089,267

LONG TERM LIABILITIES

Others

-

-

-

16,137,735

15,005,558

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

-

-

-

16,137,735

15,005,558

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

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

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

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

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

76,309,000

58,747,000

60,286,000

51,144,721

34,094,825

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

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

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

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

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

 

 

FINANCIAL RATIO

 

QL FEED SDN. BHD.

 

TYPES OF FUNDS

Cash

19,791,000

20,931,000

21,194,000

13,329,735

18,660,869

Net Liquid Funds

(151,183,000)

(106,777,000)

(118,130,000)

(100,150,522)

(86,905,686)

Net Liquid Assets

39,069,000

25,034,000

15,968,000

11,199,682

(15,868,164)

Net Current Assets/(Liabilities)

74,541,000

55,131,000

55,484,000

45,521,328

17,679,181

Net Tangible Assets

76,309,000

58,747,000

60,286,000

51,144,721

34,094,825

Net Monetary Assets

39,069,000

25,034,000

15,968,000

(4,938,053)

(30,873,722)

BALANCE SHEET ITEMS

Total Borrowings

171,023,000

127,708,000

139,324,000

113,480,257

105,566,555

Total Liabilities

197,417,000

140,852,000

160,743,000

151,849,272

139,487,499

Total Assets

273,726,000

199,599,000

221,029,000

186,856,258

158,576,766

Net Assets

76,309,000

58,747,000

60,286,000

51,144,721

34,094,825

Net Assets Backing

76,309,000

58,747,000

60,286,000

35,006,986

19,089,267

Shareholders' Funds

76,309,000

58,747,000

60,286,000

35,006,986

19,089,267

Total Share Capital

26,000,000

26,000,000

26,000,000

26,000,000

26,000,000

Total Reserves

50,309,000

32,747,000

34,286,000

9,006,986

(6,910,733)

LIQUIDITY (Times)

Cash Ratio

0.10

0.15

0.13

0.10

0.15

Liquid Ratio

1.20

1.18

1.10

1.08

0.87

Current Ratio

1.38

1.39

1.35

1.34

1.14

WORKING CAPITAL CONTROL (Days)

Stock Ratio

14

14

18

18

19

Debtors Ratio

32

24

60

18

21

Creditors Ratio

2

1

8

4

4

SOLVENCY RATIOS (Times)

Gearing Ratio

2.24

2.17

2.31

3.24

5.53

Liabilities Ratio

2.59

2.40

2.67

4.34

7.31

Times Interest Earned Ratio

6.93

4.25

12.08

12.45

3.62

Assets Backing Ratio

2.93

2.26

2.32

1.97

1.31

PERFORMANCE RATIO (%)

Operating Profit Margin

3.35

1.95

4.59

4.31

2.57

Net Profit Margin

2.60

1.56

3.56

3.54

2.03

Return On Net Assets

48.68

34.45

65.73

62.13

66.12

Return On Capital Employed

48.65

34.45

65.73

62.13

66.12

Return On Shareholders' Funds/Equity

32.33

21.09

46.79

68.58

67.53

Dividend Pay Out Ratio (Times)

0.28

1.14

0.10

0.34

0.19

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

0

0

 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.61.94

UK Pound

1

Rs.103.31

Euro

1

Rs.85.11

 

 

INFORMATION DETAILS

 

Report Prepared by :

NIS

 

 

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.