MIRA INFORM REPORT

 

 

Report Date :

11.07.2014

 

IDENTIFICATION DETAILS

 

Name :

MALAYAN SUGAR MANUFACTURING COMPANY BERHAD

 

 

Formerly Known As :

MALAYAN SUGAR MANUFACTURING CO LTD

 

 

Registered Office :

Menara Felda, Platinum Park, 11, Persiaran KLCC, Level 42, 50088 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2012

 

 

Date of Incorporation :

06.10.1959

 

 

Com. Reg. No.:

3573-D

 

 

Legal Form :

Public

 

 

Line of Business :

Manufacture and Trade of Sugar Refining

 

 

No. of Employees :

400 [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 – March 31, 2014

 

Country Name

Previous Rating

(31.12.2013)

Current Rating

(31.03.2014)

Malaysia

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low Risk

 

A2

Moderately Low Risk

 

B1

Moderate Risk

 

B2

Moderately High Risk

 

C1

High Risk

 

C2

Very High Risk

 

D

 


 

MALAYSIA - ECONOMIC OVERVIEW

 

Malaysia, a middle-income country, has transformed itself since the 1970s from a producer of raw materials into an emerging multi-sector economy. Under current Prime Minister NAJIB, Malaysia is attempting to achieve high-income status by 2020 and to move farther up the value-added production chain by attracting investments in Islamic finance, high technology industries, biotechnology, and services. NAJIB's Economic Transformation Program (ETP) is a series of projects and policy measures intended to accelerate the country's economic growth. The government has also taken steps to liberalize some services sub-sectors. The NAJIB administration also is continuing efforts to boost domestic demand and reduce the economy's dependence on exports. Nevertheless, exports - particularly of electronics, oil and gas, palm oil and rubber - remain a significant driver of the economy. As an oil and gas exporter, Malaysia has profited from higher world energy prices, although the rising cost of domestic gasoline and diesel fuel, combined with 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.

:

3573-D

COMPANY NAME

:

MALAYAN SUGAR MANUFACTURING COMPANY BERHAD

FORMER NAME

:

MALAYAN SUGAR MANUFACTURING CO LTD (09/04/1975)

MALAYAN SUGAR MANUFACTURING CO SDN BHD

INCORPORATION DATE

:

06/10/1959

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PUBLIC

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

MENARA FELDA, PLATINUM PARK, 11, PERSIARAN KLCC, LEVEL 42, 50088 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

LEVEL 44 MENARA FELDA PLATINUM PARK, 11 PERSIARAN KLCC, 50088 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

TEL.NO.

:

03-21814818

FAX.NO.

:

03-21814827

EMAIL

:

MSMSUGAR@FELDAMSM.NET.MY

WEB SITE

:

WWW.MSM.COM.MY

CONTACT PERSON

:

AHMAD TIFLI BIN MOHD TALHA ( DIRECTOR )

INDUSTRY CODE

:

10721

PRINCIPAL ACTIVITY

:

MANUFACTURE AND TRADE OF SUGAR REFINING

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 36,360,000.00 DIVIDED INTO
ORDINARY SHARES 6,060,000 CASH AND 30,300,000 OTHERWISE OF MYR 1.00 EACH.

SALES

:

MYR 2,005,011,536 [2012]

NET WORTH

:

MYR 464,570,838 [2012]

M1000 OVERALL RANKING

:

262[2011]

M1000 INDUSTRY RANKING

:

17[2011]

STAFF STRENGTH

:

400 [2014]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

STABLE

PAYMENT

:

PROMPT

MANAGEMENT CAPABILITY

:

GOOD

COMMERCIAL RISK

:

LOW

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

GOOD

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

 

 

HISTORY / BACKGROUND

 

As a public limited company, the Subject must have at least one shareholder but there is no limit on the maximum number of shareholders. The Subject must have at least two directors. A public 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, suing or be sued by other companies. The liabilities of the shareholders are only up 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 must file in its annual return, together with its financial statements with the Registrar of Companies. In Malaysia, all the companies seeking listing on the Bursa Malaysia (Malaysia Stock Exchange) must be public limited companies.

The Subject is principally engaged in the (as a / as an) manufacture and trade of sugar refining.

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

2008

2005

2004

 

OVERALL RANKING

262

306

318

290

240

 

INDUSTRY RANKING

17

21

22

23

16

 

 

The immediate holding company of the Subject is MSM MALAYSIA HOLDINGS BERHAD, a company incorporated in MALAYSIA.

The ultimate holding company of the Subject is FELDA GLOBAL VENTURES HOLDINGS 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 36,360,000.00

 

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

 

Name

Address

IC/PP/Loc No

Shareholding

(%)

MSM MALAYSIA HOLDINGS BERHAD

MENARA FELDA, PLATINUM PARK, 11, PERSIARAN KLCC, LEVEL 42, 50088 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

935722K

36,360,000.00

100.00

 

 

 

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

------

 

 

 

36,360,000.00

100.00

 

 

 

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

=====

+ Also Director

The Subject's interest in other companies (Subsidiaries/Associates) are shown as follow :

 

Local No

Country

Company

(%)

As At

208409P

MALAYSIA

ASTAKONAS SDN. BHD.

100.00

29/03/2013

 

 

 

 

 

365077D

MALAYSIA

MSM PROPERTIES SDN. BHD.

100.00

29/03/2013

 

 

 

 

 

100562V

MALAYSIA

PARI SHIPPING SDN BHD

99.60

29/03/2013

 

 

 

 

 



DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. AHMAD TIFLI BIN MOHD TALHA

Address

:

9, JALAN PUALAM TIGA 7/32C, 40000 SHAH ALAM, SELANGOR, MALAYSIA.

IC / PP No

:

A0137167

New IC No

:

650627-10-6437

Date of Birth

:

27/06/1965

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

01/10/2012

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 2

 

Name Of Subject

:

DATO' DR SHEIKH AWAB BIN SHEIKH ABOD

Address

:

14, JALAN 3/67, 48000 RAWANG, SELANGOR, MALAYSIA.

IC / PP No

:

5855380

New IC No

:

600221-01-5273

Date of Birth

:

21/02/1960

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

01/01/2014

 

 

 

 

 

 

 

 

 

 

 

 



MANAGEMENT

 

 

 

1)

Name of Subject

:

AHMAD TIFLI BIN MOHD TALHA

 

Position

:

DIRECTOR

 

 

 

 

 

2)

Name of Subject

:

MAK FOOI CHOI

 

Position

:

FINANCE MANAGER

 

 

 

 

 

3)

Name of Subject

:

TAN SIEW TONG

 

Position

:

SALES MANAGER

 

 

 

 

 

4)

Name of Subject

:

NOOR HALILAH

 

Position

:

HUMAN RESOURCE MANAGER

 

 

AUDITOR

 

Auditor

:

PRICEWATERHOUSECOOPERS

Auditor' Address

:

1 SENTRAL, JALAN TRAVERS, K.L. CENTRAL, P.O.BOX 10192, LEVEL 15, 50706 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. KOO SHUANG YEN

 

IC / PP No

:

6770467

 

New IC No

:

620820-06-5246

 

Address

:

35, JALAN BU4/9, BANDAR UTAMA, 47800 PETALING JAYA, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

2)

Company Secretary

:

MS. SHAHNIZA ANOM BINTI ELIAS

 

IC / PP No

:

A1172646

 

New IC No

:

680929-01-5802

 

Address

:

26, JALAN UNGU U9/35, SUNWAY KAYANGAN, SEKSYEN U9, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

 

 

 

 

 

 

 

 

 

 

 


ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

27/04/2011

MEMORANDUM OF DEPOSIT CUM DEED OF ASSIGNMENT OF FIXED DEPOSIT RECEIPT AND/OR NEGOTIABLE INSTRUMENTS OF DEPOSIT (FIRST PARTY) AND LETTER OF SET-OFF (FIRST PARTY) DATED 27TH APRIL 2011N

MAYBANK ISLAMIC BERHAD

MYR 150,000,000.00

Satisfied

 

LEGAL CHECK AGAINST SUBJECT


* A check has been conducted in our databank againt the Subject whether the subject has been involved in any litigation. Our databank consists of 99% of the wound up companies in Malaysia.


No legal action was found in our databank.


No winding up petition was found in our databank.

 

 

DEFAULTER CHECK AGAINST SUBJECT


* We have checked through the Subject in our defaulters' database which comprised of debtors that have been blacklisted by our customers and debtors that have been placed or assigned to us for collection 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

:

60%

Overseas

:

YES

Percentage

:

40%

Import Countries

:

JAPAN


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

:

80%

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Percentage

:

20%

Export Market

:

SINGAPORE

NEW ZEALAND


ASIA

Credit Term

:

30 - 60 DAYS

 

 

 

 

 

 

Payment Mode

:

CHEQUES
TELEGRAPHIC TRANSFER (TT)

Type of Customer

:

FOOD MANUFACTURERS,HOTELS,RESTAURANTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Products manufactured

:

SUGAR REFINING

 

 

 

Product Brand Name

:

PRAI SUGAR

 

 

 

Certification of Products

:

1) ISO 9002 Year :1994 2) ISO 9001 : 2000 Year :2002 3) HAZARD ANALYSIS AND CRITICAL CONTROL POINT (HACCP) CERTIFICATION Year :2002

 

 

 

 

 

 

Competitor(s)

:

CENTRAL SUGARS REFINERY SDN BHD
GULA PADANG TERAP SDN BHD
GULA PERAK BHD
KILANG GULA FELDA PERLIS SENDIRIAN BERHAD
SHARIKAT PUTRA PUTRI SDN BHD

 

 

 

 

 

 

 

 

Member(s) / Affiliate(s)

:

FEDERATION OF MALAYSIAN MANUFACTURERS (FMM)

SMI ASSOCIATION OF MALAYSIA

MALAYSIA FOOD & BEVERAGE INDUSTRY

 

 

 

Ownership of premises

:

OWNED

 

Factory / Premises

:

798 MAIN ROAD, 13600 PRAI, PULAU PINANG, MALAYSIA.
Tel No: 04-3902611
Fax No: 04-3908122

 

 

 

 

 

Total Number of Employees:

 

YEAR

2014

2013

2012

2011

2010

 

 

 

 


 

GROUP

N/A

N/A

N/A

N/A

N/A

 

 

 

 

COMPANY

400

400

400

400

370

 

 

 

 

 

Branch

:

NO

 

Other Information:


The Subject is principally engaged in the (as a / as an) manufacture and trade of sugar refining.

The Subject officially incorporated year 1959.


The Subject is a sugar refinery located in Prai, Penang, on the northwest coast of Peninsular Malaysia.

The Facility is the largest sugar refinery in Malaysia and has an annual production capacity of 960,000 mt of refined sugar, representing approximately 86% of our total capacity.


Over the years, the Subject has achieved a number of major certification for its product and manufacturing process.


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

0321814818

Current Telephone Number

:

03-21814818

Match

:

YES

 

 

 

Address Provided by Client

:

LEVEL 44 MENARA FELDA PLATINUM PARK, 11 PERSIARAN KLCC,50088,KUALA LUMPUR,WILAYAH PERSEKUTUAN.

Current Address

:

LEVEL 44 MENARA FELDA PLATINUM PARK, 11 PERSIARAN KLCC, 50088 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Match

:

YES

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations


On 10th July 2014, we contacted one of the staff from the Subject and she provided some information.


FINANCIAL ANALYSIS

 

 

Profitability

 

 

 

 

 

 

Turnover

:

Increased

[

2008 - 2012

]

 

Profit/(Loss) Before Tax

:

Decreased

[

2008 - 2012

]

 

Return on Shareholder Funds

:

Favourable

[

43.87%

]

 

Return on Net Assets

:

Favourable

[

58.96%

]

 

 

 

 

 

 

 

 

The Subject's turnover increased steadily as the demand for its products / services increased due to the goodwill built up over the years.The dip in profit could be due to the stiff market competition which reduced the Subject's profit margin. 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

:

Unfavourable

[

67 Days

]

 

Debtor Ratio

:

Favourable

[

33 Days

]

 

Creditors Ratio

:

Favourable

[

1 Days

]

 

 

 

 

 

 

 

 

The Subject could be incurring higher holding cost. As its capital was tied up in stocks, it could face liquidity problems. 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

:

Acceptable

[

0.86 Times

]

 

Current Ratio

:

Unfavourable

[

1.74 Times

]

 

 

 

 

 

 

 

 

The Subject's liquid ratio was slightly low. This could indicate that the Subject's working capital was slightly deficient. The Subject will have to improve its liquidity position either by obtaining short term financing or increase its paid up capital so that it can meet all its short term obligations as and when they fall due.

 

 

 

 

 

 

 

Solvency

 

 

 

 

 

 

Interest Cover

:

Favourable

[

25.77 Times

]

 

Gearing Ratio

:

Acceptable

[

0.81 Times

]

 

 

 

 

 

 

 

 

The interest cover showed that the Subject was able to service the interest. The favourable interest cover could indicate that the Subject was making enough profit to pay for the interest accrued. The Subject's gearing was slightly high. The Subject is utilising the leverage concept to fund its expansion. However, the high gearing has added financial risks to the Subject. It will be more vulnerable in times of economy downturn.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall Assessment :

 

 

 

 

 

 

Although the Subject's turnover had increased, its profits had declined over the same corresponding period. This could be due to the stiffer market competition and / or higher operating costs which lowered the Subject's profit margin. 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. With the favourable interest cover, the Subject could be able to service all the accrued interest without facing any difficulties. The Subject's gearing was slightly high and its financial risk was also high. If no plans are made to reduce its gearing, the Subject's performance may deteriorate in the coming year.

 

 

 

 

 

 

 

Overall financial condition of the Subject : STABLE

 

 


MALAYSIA ECONOMIC / INDUSTRY OUTLOOK

 

Major Economic Indicators:

2009

2010

2011

2012*

2013**

 

 

 

 

 

 

Population ( Million)

28.13

28.35

28.70

29.30

29.80

Gross Domestic Products ( % )

(0.5)

7.2

5.1

5.6

5.3

Domestic Demand ( % )

2.9

6.3

8.2

9.4

5.6

Private Expenditure ( % )

(2.7)

8.1

8.2

8.0

7.4

Consumption ( % )

0.7

6.7

7.1

1.0

5.7

Investment ( % )

(17.2)

17.7

12.2

11.7

13.3

Public Expenditure ( % )

5.2

3.8

8.4

13.3

1.2

Consumption ( % )

3.1

0.2

16.1

11.3

(1.2)

Investment ( % )

8.0

2.8

(0.3)

15.9

4.2

 

 

 

 

 

 

Balance of Trade ( MYR Million )

89,650

118,356

116,058

106,300

110,700

Government Finance ( MYR Million )

(28,450)

(40,482)

(45,511)

(42,297)

(39,993)

Government Finance to GDP / Fiscal Deficit ( % )

(4.8)

(5.6)

(5.4)

(4.5)

(4.0)

Inflation ( % Change in Composite CPI)

(5.2)

5.1

3.1

1.6

2.5

Unemployment Rate

4.5

3.9

3.3

3.2

3.0

 

 

 

 

 

 

Net International Reserves ( MYR Billion )

331

329

415

427

-

Average Risk-Weighted Capital Adequacy Ratio ( % )

2.87

2.20

3.50

2.20

-

Average 3 Months of Non-performing Loans ( % )

11.08

15.30

14.80

14.70

-

Average Base Lending Rate ( % )

5.53

6.30

6.60

6.53

-

Business Loans Disbursed( % )

10.5

14.7

15.3

32.2

-

Foreign Investment ( MYR Million )

22,156.8

22,517.9

23,546.1

26,230.4

-

Consumer Loans ( % )

-

-

-

-

-

 

 

 

 

 

 

Registration of New Companies ( No. )

41,578

44,148

45,455

45,441

-

Registration of New Companies ( % )

(0.1)

6.2

3.0

(0.0)

-

Liquidation of Companies ( No. )

39,075

25,585

132,476

-

-

Liquidation of Companies ( % )

39.6

(34.5)

417.8

-

-

 

 

 

 

 

 

Registration of New Business ( No. )

312,581

271,414

284,598

324,761

-

Registration of New Business ( % )

-

-

-

-

-

Business Dissolved ( No. )

19,345

19,738

20,121

-

-

Business Dissolved ( % )

2.4

2.0

1.9

-

-

 

 

 

 

 

 

Sales of New Passenger Cars (' 000 Unit )

486.3

543.6

535.1

552.2

-

Cellular Phone Subscribers ( Million )

30.1

32.8

35.3

38.5

-

Tourist Arrival ( Million Persons )

23.6

24.6

24.7

25.0

-

Hotel Occupancy Rate ( % )

58.0

63.0

60.6

62.4

-

 

 

 

 

 

 

Credit Cards Spending ( % )

12.8

14.1

15.6

12.6

-

Bad Cheque Offenders (No.)

36,667

33,568

32,627

26,982

-

Individual Bankruptcy ( No.)

16,228

18,119

19,167

19,575

-

Individual Bankruptcy ( % )

16.7

11.7

5.8

2.1

-



INDUSTRIES ( % of Growth ):

2009

2010

2011

2012*

2013**

 

 

 

 

 

 

Agriculture

0.4

2.1

5.9

0.6

2.4

Palm Oil

(1.1)

(3.4)

10.8

(2.8)

-

Rubber

(19.8)

9.9

6.1

(0.6)

-

Forestry & Logging

(5.9)

(3.3)

(7.6)

(2.2)

-

Fishing

5.5

5.6

2.1

(0.7)

-

Other Agriculture

9.0

7.9

7.1

6.4

-

Industry Non-Performing Loans ( MYR Million )

413.7

508.4

634.1

-

-

% of Industry Non-Performing Loans

1.3

2.1

3.2

-

-

 

 

 

 

 

 

Mining

(3.8)

0.2

(5.7)

1.5

2.7

Oil & Gas

2.1

0.5

(1.7)

-

-

Other Mining

-

-

-

-

-

Industry Non-performing Loans ( MYR Million )

44.2

49.7

46.5

-

-

% of Industry Non-performing Loans

0.1

0.1

0.1

-

-

 

 

 

 

 

 

Manufacturing #

(9.4)

11.4

4.7

4.2

4.9

Exported-oriented Industries

(19.0)

12.1

2.8

4.1

-

Electrical & Electronics

(30.3)

28.4

(4.9)

1.6

-

Rubber Products

(10.1)

25.3

15.4

3.6

-

Wood Products

(24.1)

20.1

(4.9)

4.6

-

Textiles & Apparel

(19.5)

(0.4)

14.8

(7.1)

-

Domestic-oriented Industries

(9.8)

16.3

6.5

8.6

-

Food, Beverages & Tobacco

0.2

3.0

4.2

-

-

Chemical & Chemical Products

(7.7)

16.2

5.5

9.9

-

Plastic Products

(9.1)

2.4

3.8

-

-

Iron & Steel

(32.7)

29.3

2.4

-

-

Fabricated Metal Products

(2.5)

14.9

25.2

-

-

Non-metallic Mineral

(15.5)

20.2

27.1

6.6

-

Transport Equipment

(13.5)

36.5

(10.4)

13.7

-

Paper & Paper Products

(5.0)

18.7

14.8

(7.8)

-

Crude Oil Refineries

0.2

(11.4)

9.3

-

-

Industry Non-Performing Loans ( MYR Million )

6,007.3

6,217.5

6,537.2

-

-

% of Industry Non-Performing Loans

18.3

23.8

25.7

-

-

 

 

 

 

 

 

Construction

5.8

5.1

4.4

15.5

11.2

Industry Non-Performing Loans ( MYR Million )

3,241.8

4,038.5

3,856.9

-

-

% of Industry Non-Performing Loans

9.9

10.7

10.2

-

-

 

 

 

 

 

 

Services

2.6

6.5

6.4

5.5

5.6

Electric, Gas & Water

0.4

8.5

5.6

4.8

-

Transport, Storage & Communication

1.6

7.7

6.5

7.3

-

Wholesale, Retail, Hotel & Restaurant

2.8

4.7

5.2

6.9

-

Finance, Insurance & Real Estate

3.8

6.1

6.3

6.5

-

Government Services

2.0

6.7

7.6

5.6

-

Other Services

4.4

4.2

5.4

5.7

-

Industry Non-Performing Loans ( MYR Million )

6,631.3

7,384.6

6,825.2

-

-

% of Industry Non-Performing Loans

20.2

25.7

23.4

-

-

 

 

 

 

 

 

 

 

 

 

 

 

* Estimate / Preliminary

 

 

 

 

 

** Forecast

 

 

 

 

 

# Based On Manufacturing Production Index



INDUSTRY ANALYSIS

 

MSIC CODE

10721 : Manufacture of sugar

 

 

INDUSTRY :

MANUFACTURING

 

 

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

 

OVERALL INDUSTRY OUTLOOK : Average Growth



CREDIT RISK EVALUATION & RECOMMENDATION

 


Incorporated in 1959, the Subject is a Public Limited Company company, focusing on manufacture and trade of sugar refining. With its long track record in the industry, the Subject should have set up pretty sound supply channels and is able to meet the demands of its customers to a large extent. The Subject is well backed by a listed company shareholders which would stimulate further growth for the Subject. Hence, the potential growth of the Subject is positive. 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 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 400 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.

Financially, the Subject registered a higher turnover compared to previous year. However, its profits showed a reverse trend. The lower profit achieved was a result of higher operating cost and increased competition. 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 managed to maintain an adequate liquidity level, indicating that the Subject has the ability to meet its financial obligations. The gearing level of the Subject is slightly high, therefore it faces moderate financial risk. Given a positive net worth standing at MYR 464,570,838, the Subject should be able to maintain its business in the near terms.

Having a strong assets backing, the Subject possesses latent assets as collateral for further financial extension. Hence, it has good chance of getting loans if the needs arises. The Subject's supplier are from both the local and overseas countries. This will eliminates the risk of dependency on deliveries from a number of key suppliers and insufficient quantities of its raw materials. Overall the Subject has a good control over its resources.


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)

 

Financial Year End

2012-12-31

2011-12-31

2010-12-31

2009-12-31

2008-12-31

Months

12

12

12

12

12

Consolidated Account

GROUP

GROUP

GROUP

GROUP

GROUP

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

2,005,011,536

1,973,724,286

1,850,618,700

1,380,137,865

954,658,936

 

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

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

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

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

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

Total Turnover

2,005,011,536

1,973,724,286

1,850,618,700

1,380,137,865

954,658,936

Costs of Goods Sold

(1,655,894,936)

(1,561,461,055)

(1,451,269,722)

-

-

 

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

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

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

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

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

Gross Profit

349,116,600

412,263,231

399,348,978

-

-

 

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

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

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

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

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

 

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

271,296,000

346,373,943

313,222,572

443,420,720

203,587,323

 

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

271,296,000

346,373,943

313,222,572

443,420,720

203,587,323

Taxation

(67,474,581)

(91,800,842)

(71,609,301)

(57,316,371)

(44,359,814)

 

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

203,821,419

254,573,101

241,613,271

386,104,349

159,227,509

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

 

As previously reported

343,164,979

439,495,878

353,879,819

616,346,607

832,441,562

Prior year adjustment

-

-

-

183,827

-

 

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

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

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

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

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

As restated

343,164,979

439,495,878

353,879,819

616,530,434

832,441,562

 

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

546,986,398

694,068,979

595,493,090

1,002,634,783

991,669,071

DIVIDENDS - Ordinary (paid & proposed)

(118,775,560)

(350,904,000)

(155,997,212)

(648,754,964)

(375,322,464)

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

428,210,838

343,164,979

439,495,878

353,879,819

616,346,607

 

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

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

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

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

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

 

 

 

 

 

 

INTEREST EXPENSE (as per notes to P&L)

 

 

 

 

 

Bank overdraft

-

-

217

-

137

Bankers' acceptance

8,712,490

7,811,454

5,544,219

1,262,400

3,112,360

Loan from holding company

2,238,904

1,361,096

-

-

-

Revolving loans

-

2,662,080

-

-

-

Others

-

-

13,370

19,030

20,115

 

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

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

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

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

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

 

10,951,394

11,834,630

5,557,806

1,281,430

3,132,612

 

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

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

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

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

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

 

 

 


BALANCE SHEET

 

 

 

ASSETS EMPLOYED:

 

 

 

 

 

FIXED ASSETS

169,905,179

169,637,773

168,879,208

182,114,227

146,522,991

 

 

 

 

 

 

Investment properties

-

-

-

-

3,910,205

Investments

-

-

-

-

131,172,252

Others

781,852

851,522

921,192

-

-

 

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

781,852

851,522

921,192

-

135,082,457

 

 

 

 

 

 

 

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

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

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

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

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

TOTAL LONG TERM ASSETS

170,687,031

170,489,295

169,800,400

182,114,227

281,605,448

 

 

 

 

 

 

Stocks

367,718,913

240,806,271

285,855,390

263,273,989

248,916,321

Trade debtors

178,753,534

177,749,234

157,221,614

81,121,912

70,556,498

Other debtors, deposits & prepayments

24,052,135

22,409,785

37,632,679

62,747,689

1,053,956

Short term deposits

127,414,349

131,289,588

43,234,946

135,701,310

87,219,182

Amount due from holding company

4,744

7,195

-

-

126,627,122

Amount due from related companies

2,334,043

2,436,176

252,000

-

-

Cash & bank balances

21,830,464

38,805,440

20,616,403

7,711,058

15,728,702

Others

560,825

2,052,669

20,509,253

6,033,725

-

 

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

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

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

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

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

TOTAL CURRENT ASSETS

722,669,007

615,556,358

565,322,285

556,589,683

550,101,781

 

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

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

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

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

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

TOTAL ASSET

893,356,038

786,045,653

735,122,685

738,703,910

831,707,229

 

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

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

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

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

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

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Trade creditors

4,026,360

2,791,555

5,027,213

75,731,606

3,527,726

Other creditors & accruals

24,892,428

19,118,866

12,633,807

22,829,902

20,215,330

Bill & acceptances payable

375,000,000

245,000,000

207,000,000

126,000,000

138,000,000

Amounts owing to holding company

1,147,905

100,907,397

-

61,951

-

Amounts owing to related companies

4,316,601

6,580,294

-

533,542

1,016,164

Provision for taxation

5,239,624

13,348,915

11,895,229

31,064,461

9,939,811

 

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

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

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

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

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

TOTAL CURRENT LIABILITIES

414,622,918

387,747,027

236,556,249

256,221,462

172,699,031

 

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

308,046,089

227,809,331

328,766,036

300,368,221

377,402,750

 

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

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

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

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

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

TOTAL NET ASSETS

478,733,120

398,298,626

498,566,436

482,482,448

659,008,198

 

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

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

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

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

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

 

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

 

Ordinary share capital

36,360,000

36,360,000

36,360,000

36,360,000

36,360,000

 

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

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

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

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

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

TOTAL SHARE CAPITAL

36,360,000

36,360,000

36,360,000

36,360,000

36,360,000

 

 

 

 

 

 

Exchange equalisation/fluctuation reserve

-

-

-

-

(1,539,725)

Retained profit/(loss) carried forward

428,210,838

343,164,979

439,495,878

353,879,819

616,346,607

Others

-

-

-

80,000,000

-

 

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

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

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

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

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

TOTAL RESERVES

428,210,838

343,164,979

439,495,878

433,879,819

614,806,882

 

 

 

 

 

 

 

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

464,570,838

379,524,979

475,855,878

470,239,819

651,166,882

 

 

 

 

 

 

Deferred taxation

14,162,282

18,773,647

22,710,558

12,242,629

7,841,316

 

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

14,162,282

18,773,647

22,710,558

12,242,629

7,841,316

 

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

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

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

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

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

 

478,733,120

398,298,626

498,566,436

482,482,448

659,008,198

 

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

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

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

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

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

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

 

TYPES OF FUNDS

 

 

 

 

 

Cash

149,244,813

170,095,028

63,851,349

143,412,368

102,947,884

Net Liquid Funds

(225,755,187)

(74,904,972)

(143,148,651)

17,412,368

(35,052,116)

Net Liquid Assets

(59,672,824)

(12,996,940)

42,910,646

37,094,232

128,486,429

Net Current Assets/(Liabilities)

308,046,089

227,809,331

328,766,036

300,368,221

377,402,750

Net Tangible Assets

478,733,120

398,298,626

498,566,436

482,482,448

659,008,198

Net Monetary Assets

(73,835,106)

(31,770,587)

20,200,088

24,851,603

120,645,113

BALANCE SHEET ITEMS

 

 

 

 

 

Total Borrowings

375,000,000

247,662,080

207,000,000

126,000,000

138,000,000

Total Liabilities

428,785,200

406,520,674

259,266,807

268,464,091

180,540,347

Total Assets

893,356,038

786,045,653

735,122,685

738,703,910

831,707,229

Net Assets

478,733,120

398,298,626

498,566,436

482,482,448

659,008,198

Net Assets Backing

464,570,838

379,524,979

475,855,878

470,239,819

651,166,882

Shareholders' Funds

464,570,838

379,524,979

475,855,878

470,239,819

651,166,882

Total Share Capital

36,360,000

36,360,000

36,360,000

36,360,000

36,360,000

Total Reserves

428,210,838

343,164,979

439,495,878

433,879,819

614,806,882

LIQUIDITY (Times)

 

 

 

 

 

Cash Ratio

0.36

0.44

0.27

0.56

0.60

Liquid Ratio

0.86

0.97

1.18

1.14

1.74

Current Ratio

1.74

1.59

2.39

2.17

3.19

WORKING CAPITAL CONTROL (Days)

 

 

 

 

 

Stock Ratio

67

45

56

70

95

Debtors Ratio

33

33

31

21

27

Creditors Ratio

1

1

1

20

1

SOLVENCY RATIOS (Times)

 

 

 

 

 

Gearing Ratio

0.81

0.65

0.44

0.27

0.21

Liabilities Ratio

0.92

1.07

0.54

0.57

0.28

Times Interest Earned Ratio

25.77

30.27

57.36

347.04

65.99

Assets Backing Ratio

13.17

10.95

13.71

13.27

18.12

PERFORMANCE RATIO (%)

 

 

 

 

 

Operating Profit Margin

13.53

17.55

16.93

32.13

21.33

Net Profit Margin

10.17

12.90

13.06

27.98

16.68

Return On Net Assets

58.96

89.93

63.94

92.17

31.37

Return On Capital Employed

58.96

89.34

63.94

92.17

31.37

Return On Shareholders' Funds/Equity

43.87

67.08

50.77

82.11

24.45

Dividend Pay Out Ratio (Times)

0.58

1.38

0.65

1.68

2.36

NOTES TO ACCOUNTS

 

 

 

 

 

Contingent Liabilities

0

0

0

0

0



FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.59.88

UK Pound

1

Rs.102.59

Euro

1

Rs.81.69

 

INFORMATION DETAILS

 

Analysis Done by :

SUB

 

 

Report Prepared by :

NNA

 

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.