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Report Date : |
11.01.2014 |
IDENTIFICATION DETAILS
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Name : |
FOX-WIZEL LTD. |
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Registered Office : |
P.O. Box 76, Lod Airport (7015002) 6 Hermon Street AirPort City Park Airport City 7019900 |
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Country : |
Israel |
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Financials (as on) : |
30.09.2013 |
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Date of Incorporation : |
01.06.1995 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Importers, manufacturers, marketers, exporters and retailers of apparel and fashion accessories |
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No. of Employees : |
2,540 |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Good |
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Payment Behaviour : |
No complaints |
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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) |
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Israel |
A2 |
A2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
ISRAEL - ECONOMIC OVERVIEW
Israel has a technologically advanced market economy. Its major imports include crude oil, grains, raw materials, and military equipment. Cut diamonds, high-technology equipment, and pharmaceuticals are among the leading exports. Israel usually posts sizable trade deficits, which are covered by tourism and other service exports, as well as significant foreign investment inflows. The global financial crisis of 2008-09 spurred a brief recession in Israel, but the country entered the crisis with solid fundamentals - following years of prudent fiscal policy and a resilient banking sector. The economy has recovered better than most advanced, comparably sized economies. In 2010, Israel formally acceded to the OECD. Israel's economy also has weathered the Arab Spring because strong trade ties outside the Middle East have insulated the economy from spillover effects. Natural gasfields discovered off Israel's coast during the past two years have brightened Israel''s energy security outlook. The Leviathan field was one of the world''s largest offshore natural gas finds this past decade, and production from the Tama field is expected to meet all of Israel''s natural gas demand beginning mid-2013. In mid-2011, public protests arose around income inequality and rising housing and commodity prices. The government formed committees to address some of the grievances but has maintained that it will not engage in deficit spending to satisfy populist demands
|
Source
: CIA |
FOX-WIZEL LTD.
Telephone 972 3 905 01 00
Fax 972 3 905 02 06; 905 02 00
P.O. Box 76, Lod Airport (7015002)
6 Hermon Street
AirPort City Park
Airport City 7019900 Israel
Originally incorporated as a sole proprietorship in 1990.
Converted into a private limited company, registered as per file No. 51-215760-3 on the 01.06.1995.
Originally registered under the name WIESEL TEXTILE MARKETING LTD., which changed to the present name on 23.01.2002.
On 15.04.2002 published a prospectus offering shares to the public on the Tel Aviv Stock Exchange (raising a sum of NIS 48 million) and on 1.8.2002 converted into a public limited company (Registration number remain as before).
Authorized share capital NIS 150,000.00, divided into -
15,000,000 ordinary shares of NIS 0.01 each,
of which 13,033,709 shares amounting to NIS 130,337.09 were issued.
WIESEL HOLDINGS A.I.H LTD., 25.9%, equally owned by Harel Eliezer Wiesel, Iftach Wiesel and Assaf Wiesel,
Avraham Dov Fuchs (through TRICO FOX LTD.), 25.5%,
Lev Levayev (through MEMORAND MANAGEMENT (1998) LTD.), 19.4%,
CLAL HOLDINGS, 7.2%, an institutional investor,
Shares are also traded on the Tel Aviv Stock Exchange.
Avraham Zeldman, Chairman
Harel Wiesel, General Manager,
Avraham Dov Fuchs,
Shai Levin,
Israel Maimon,
Alon Cohen,
Ms. Osnat Ronen.
Designers, importers, manufacturers, marketers, exporters and retailers of apparel and fashion accessories under the brand name “Fox”, under 4 categories: "Fox Men", "Fox Women", "Fox Kids" and "Fox Baby"., as well as stores under the brand name "American Eagle" and "Aerie" ("AE" Brand). Also Operating "Marsha" shoe brand.
Also importers and marketers of household product branded "Fox Home".
Sales are to subject's shops, to wholesalers, institutional organs, as well as to subject’s concessionaires overseas.
Manufacturing is carried out through some 20 suppliers and subcontractors abroad (though working mostly with 2 large subcontractors). Until 2008 subject operated also its own manufacturing line in Israel, but decided to close it down.
Major foreign supplier: WINGSRICH, Hong Kong/ China.
As of 30.09.2013, operating 185 branches in Israel of which 156 "Fox" brands including 29 stores of "Fox Home" brand and 4 combined "Fox" apparel and "Fox Home" stores, as well as 29 branches of "American Eagle" apparel and "Aerie" lingerie brand.
In addition, operating via concessionaires through 250 branches and Points of Sale abroad under the name "Fox" in 11 countries: Singapore, Romania, Thailand, Panama, The Philippines, Moldavia, Cyprus, Kazakhstan, Serbia, Mongolia and Russia. Sales are also via distributors in Russia, Kazakhstan, Panama, Georgia, Greece, Belgium and Germany.
Subject, via its subsidiaries, also marketers clothes and fashion accessories under the brand name “Sacks” – 16 branches, "Billabong" – 35 branches, and home care and body care products under the name "Lalin" – 84 branches (as well as 19 "Lalin" concessionaire stores abroad).
Also operating 15 points of sales in local malls of "Marsha" + 2 points of sale in London.
Advertising agency: GITAM BBDO.
Operating from rented premises (headquarters and offices, warehouse and logistics center), on an area of 15,680 sq. meters (12,600 sq. meters built), in 6 Hermon Street, Fox House, Airport City Park (near Ben Gurion Airport, Lod), and from retail stores nationwide (as of end of 2012 rents 172 active shops, situated mainly in shopping malls and centers – Note: some stores are combined stores which are considered 2 stores).
Landlord in Airport City: TNUVOT KESHET.
Having 2,540 employees in subject as of end of 2012 (had 1,950 employees at the end of 2011) and further 865 employees in subsidiaries.
In June 2006 subject issued bonds to the public through the Tel Aviv Stock Exchange, raising a sum of NIS 70 million. In December 2008 subject announced on self purchase of its bonds (issued May 2006) up to total of NIS 10 million.
Consolidated B/S shows:
NIS (thousands)
ASSETS 31.12.2012 30.09.2013
Current assets:
Cash and cash equivalents 59,740 36,080
Sort term investments & financial assets 77,155 119,818
Customers 112,055 95,353
Other debtors 11,082 21,612
Stock 182,940 201,021
442,972 473,884
Non-current assets:
Financial assets 63,322 58,027
Fixed assets (net) 156,669 180,132
Intangible assets 5,827 8,456
Other non-current assets 117,128 130,271
342,946 376,886
785,918 850,770
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LIABILITIES
Current liabilities 215,486 171,748
Non-current liabilities 123,024 209,596
Equity 447,408 469,426
785,918 850,770
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Current market value US$ 402 million.
In August 2012 subject's bonds rating was upgraded to A1 (from A2).
There are 8 charges for unlimited amounts, as well as 2 charges for the total sum of US$ 16,100,000 registered on the company's assets, in favor of Bank Leumi Le’Israel Ltd., HSBC Bank Plc. and Bank Hapoalim Ltd. (last 2 charges placed July-November 2013).
Consolidated
Statement of Income
NIS
(thousands)
Year
ended in 31.12
2010 2011 2012
Sales 727,146 819,124 924,533
Gross profit 416,307 476,546 515,626
Operating income 86,265 104,824 111,977
Pre-tax income 76,297 100,287 102,389
Net income 58,080 75,465 81,668
======= ======= =======
2013 consolidated first 9 months sales were NIS 747,868,000 (17% increase
compared to the parallel period in 2012), making a gross profit of
NIS 438,216,000, an operating income of NIS 90,893,000, making a net
profit of NIS 64,188,000.
FOX - WIESEL CHINA LTD., 100%, a subsidiary in China,
FOX - WIESEL CYPRUS LTD., 100%, Cyprus, operating branches in Europe.
FOX-LEVIEV LLC, 50%, Russia, operating Group's stores in Russia.
BILLY HOUSE LTD. ("Billabong Israel"), 50%, agents and marketers of Billabong surfing apparel and goods. holds 66.7% of MARSHA BALERINA LTD., import and marketing of shoes.
LALIN CANDLES AND SOAPS LTD., 50%, manufacturers and marketers of home care and body care products and accessories, including soaps, candles, body care items, toiletries, ambiance products, etc.
LALIN INTERNATIONAL LTD., 50%.
A.H. FASHION MANUFACTURE AND MARKETING 3020 LTD. (known as "Sack's"), 50%..
FOX WIZEL (BVI) LTD., 100%.
WIESEL REAL ESTATE A.I.H. (1999) LTD., sister company.
TRICO FOX LTD., leasers of real estate.
Bank Leumi Le’Israel
Ltd., Allenby Business Branch (No. 802), Tel Aviv,
account No. 60600/34.
HSBC Bank Plc., Main Branch (No. 101), Tel Aviv, account No. 500494.
A check with the Central Banks' database did not reveal anything detrimental regarding subject a/m accounts.
In February 2010 a motion was submitted to the court for the approval as a class action lawsuit against LALIN, for NIS 109 million, currently in the process of compromise.
Apart from that, nothing unfavorable learned.
FOX – WIESEL is a leading vendor in fashion wear for women, men and kids in Israel, with impressive growth rates over the last years, including expansion to overseas markets.
In September 2004, subject
signed a deal to grant MEMORAND MANAGEMENT (1998) LTD., a company owned
by businessman Lev Leviev, a license to open stores in Russia under subject’s
brand. MEMORAND was also allocated 10% in subject and further options for
another 10%, which were later fully realised. Lev Leviev controls the AFRICA ISRAEL Group, which is involved
in real estate, energy, hotels, industry & hi-tech and many other
investments in Israel and abroad. It should be mentioned that the AFRICA
ISRAEL Group was adversely hit by the
global economic crisis, accumulating huge losses (mainly due to its real estate
holdings in Russia and the USA) which forced them to reach a settlement with
its creditors and bonds holders in December
A new company FOX-LEVIEV
LLC was established by subject and MEMORAND in
Russia, and since 2006 8 stores were opened.
In August 2005, subject
signed a deal to give HE MIAN of China a license to open stores in China under
subject’s brand. In September 2005 subject established a new subsidiary in
China.
Since 2005/6 subject (via concessionaires) also began expansion into the Eastern and Central European markets, starting with Bulgaria and Romania, as well as to the Far East (Singapore, Thailand).
Since 2007/8 also expanded to Panama. In the 4th quarter of 2008 new FOX retai
stores were opened in Canada and furthre planned to be launched during 2009.
Subject signed concession agreement with Canadian SHERSON Group. In September
2009 the Canadian activities were closed.
In July 2009 subject opened a store in Puerto Rico. The Group intends to open branches in Serbia and other countries as well.
In October 2006 subject acquired 50% of BILLY HOUSE LTD.
("Billabong Israel"), agents and marketers of "Billabong"
and "Rif" surfing apparel and goods in Israel since
In March 2007, subject completed the acquisition of 50% of LALIN CANDLES AND SOAPS LTD. and LALIN INTERNATIONAL LTD., manufacturers and marketers of candles and soaps, in consideration of NIS 12.87 million, in cash.
In June 2007, subject acquired 50% of fashion retail store in chain (then, 4 boutiques) Sack's (company name is A.H. FASHION MANUFACTURE AND MARKETING 3020 LTD.), for NIS 24.6 million. Sack's manufactures and markets women fashion to wholesalers, on top of the retail stores.
In mid 2007 subject launched streamlining measures in order to improve the financial status, including closing down non-profitable shops abroad in Australia, Germany and Italy.
In view of the economic slow-down in the local market during
2009-2010, especially in the fashion retail business, subject took further
measures designed to cut costs. As part of the re-organization it erased its
sub-chain brands Fox-Kids, Fox-Man and Fox-Baby and unified all under a new
logo design.
In
November 2009 it was reported that subject is launching a new line of maternity
clothing, which will operate under the brand name "Fox Maternity".
In 2010 subject entered a new
segment under the brand name “Fox Home” for home textile and accessories. The
household products market is estimated at NIS 1 billion annually and is
considered saturated and highly competitive. Total investment in 2010-2011 in
this segment was estimated at NIS 22 million.
In March 2010 LALIN signed an agremment with BRAND EMPIRE to open 30 LALIN store in the UK. However during 2011 the concessionaire did not meet his obligations, and in June 2011 subject reported it terminated the agreement with the concessionaire, who will pay FOX £ 200,000.
During 2010 subject signed a line of agreements with foreign concessionaires, in the USA (for California region), in Virgin Islands (for The Caribbean) and in Japan. Each concessionaire committed to open a number of branches (not less than 18 in California, 15 in The Caribbean and 30 branches in Japan) within the next several years, each with investment of around US$ 2 million.
All concessionaires have already opened their first branches in their territories.
In
July 2010 subject signed an an agreement with American AEO MANAGEMENT CO. in
which subject will be the sole local representatives of "American
Eagle" and "Aerie" brands.
In
January 2012 it was reported the subject intends to open a flag oncept retail
store called "Fox House", on an area of 7,000 sq. meters, with all of
the Group's brands.
In
July 2012 subject reported it is negotiating to receive the local
representation of the "New Yorker" brand. Innitial checks of
subject's financial and logistic abilities were successful.
In March 2013 subject started operating the "Marsha" shoe pointy of sale in malls throughout Israel, and in August 2013 opened 2 points of sale in London.
According to a report from April 2013, subject intends to significantly increase its shop reaching 435 shops.
In July 2013 subject received the franchise of the children's apparel brand "The Children's Place", and is intending to open the first shop in March 2014, and reach up to 10 shops, investing NIS 2 million in each shop.
In November 2013 it was reported that subject is intending to open 5 "Aerie" lingerie shops, investing NIS 1 million in each shop.
In the end of December 2013 subject confirmed the existence of early stage negotiations for the APAX Fund, a leading international equity fund, also with significant local investments, to invest in subject, though at presently it is still too early to know if and when this will consolidate into a deal.
According
to reports from the end of 2012, total
revenues of the local fashion market are NIS 11 billion per annum. 40% of sales
are in the large fashion chains, 34% in other smaller chains, and the rest in
private shops.
According to the fashion
market survey, which monitors sales by the local fashion chains, 2012 marked
almost a freeze in revenues, with mere 0.7% increase from 2011. The data
reveals that in 2012 41 fashion chains (out of 72 chains with total of over
1,600 shops) noted decrease in sales of aparel and footwear.
Based
on surveys, around 50% and more is women's fashion. Moreover, 40% of fashion
stores in Israel belong to fashion chains, the rest being private shops.
According to the Central Bureau of Statistics (CBS), import of Clothing and Footwear in 2012 marked 13.3% rise (in NIS terms, rose by 5.1% in $ currency terms), summing up to NIS 6,792 million. That data shows on the continuing growing trend from the last couple of years – by 19% and by 13.4% in 2011 and 2010, respectively, in comparison to the previous year. Most import comes from China. Main other countries of origin for textile goods are France, Italy, Hong Kong and Turkey, Spain and the U.S.A.
In the first 10 month of 2013 import of Clothing and Footwear rose by mere 1.2% comparing to the parallel period in 2012 (5.3% in $ terms).
The local fashion market has been significantly influenced by the entrance of new international fashion players to the already highly competitive local market (GAP, H&M in 2009/2010, Forever 21 in 2011).
Sources in the local fashion branch noted that over the last periods the branch re-entered slow-down and stagnation, resulting in drop in revenues. There have been also few collapses of veteran and big players in some niches, including in the ladies fashion and children's apparel. The is explained by several factors, including the present slow-down in local economy, and the fierce competition where the entrance of the strong international chains are dragging prices down but do not bring to expansion of the fashion market.
Moreover, senior figures in the local fashion and apparel branch, as well as from the shopping malls sector, commented in November 2013 that few more chains are on the verge of collapse.
From the CBS National Accounts for 2012, it turns that expenditure by local households on private consumption grew by 2.7% from 2011, after rising by 3.8% in 2010. Expenditure on clothing, footwear and personal effects rose by 7.2% (after 2.4% rise in 2011). Expenditure on private consumption continued to grow in 2013: it rose by 5.6% in 3rdQ 2013, after a 6.2% increase in the 2ndQ 2013.
Per-capita expenditure increased by 0.9% (1.9% rise in 2011).
Per capita expenditure for private consumption on non-durable goods rose in 2012 by 1.4% per-capita (1.3% rise in 2011). This rise reflects increases by 1.3% in expenditure on food, beverage and tobacco and 4.5% expenditure on clothing, footwear and personal effects.
Good for trade engagements.
Maximum unsecured credit of up to several US$ millions.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.61.94 |
|
|
1 |
Rs.102.06 |
|
Euro |
1 |
Rs.84.31 |
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 |
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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 |
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<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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.