MIRA INFORM REPORT

 

 

Report Date :

23.07.2014

 

IDENTIFICATION DETAILS

 

Name :

WESCAST INDUSTRIES INC.

 

 

Registered Office :

150 Savannah Oak Drive, Brantford, Ontario N3V 1E7

 

 

Country :

Canada

 

 

Year of Incorporation :

1901

 

 

Legal Form :

Corporation – Profit

 

 

Line of Business :

·         Engaged in designs, engineers, casts, machines, and assembles exhaust system components for automotive original equipment manufacturers and other customers of the car and light truck markets in North America, Europe, Asia, Africa, South America, and Australia.

Subject offers exhaust manifolds, turbocharger housings, catalytic converter containers, integrated turbo manifolds, and other components.

 

 

No of Employees :

2,000

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Status :

Satisfactory 

 

 

Payment Behaviour :

Slow but Correct

 

 

Litigation :

Clear 

 

 

NOTES :

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

 

ECGC Country Risk Classification List – March 31, 2014

 

Country Name

Previous Rating

(31.12.2013)

Current Rating

(31.03.2014)

Canada

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low Risk

 

A2

Moderate Low Risk

 

B1

Moderate Risk

 

B2

Moderate High Risk

 

C1

High Risk

 

C2

Very High Risk

 

D

 

CANADA - ECONOMIC OVERVIEW

 

As a high-tech industrial society in the trillion-dollar class, Canada resembles the US in its market-oriented economic system, pattern of production, and high living standards. Since World War II, the impressive growth of the manufacturing, mining, and service sectors has transformed the nation from a largely rural economy into one primarily industrial and urban. The 1989 US-Canada Free Trade Agreement (FTA) and the 1994 North American Free Trade Agreement (NAFTA) (which includes Mexico) touched off a dramatic increase in trade and economic integration with the US, its principal trading partner. Canada enjoys a substantial trade surplus with the US, which absorbs about three-fourths of Canadian merchandise exports each year. Canada is the US's largest foreign supplier of energy, including oil, gas, uranium, and electric power. Given its abundant natural resources, highly skilled labor force, and modern capital plant, Canada enjoyed solid economic growth from 1993 through 2007. Buffeted by the global economic crisis, the economy dropped into a sharp recession in the final months of 2008, and Ottawa posted its first fiscal deficit in 2009 after 12 years of surplus. Canada's major banks, however, emerged from the financial crisis of 2008-09 among the strongest in the world, owing to the financial sector's tradition of conservative lending practices and strong capitalization. Canada achieved marginal growth in 2010-13 and plans to balance the budget by 2015. In addition, the country's petroleum sector is rapidly expanding, because Alberta's oil sands significantly boosted Canada's proven oil reserves. Canada now ranks third in the world in proved oil reserves behind Saudi Arabia and Venezuela.

Source : CIA

Company name & address

 

Company name:            WESCAST INDUSTRIES INC.

Address:                                   150 Savannah Oak Drive, Brantford, Ontario N3V 1E7 - Canada

Telephone:                    +1 519-750-0000

Fax:                              +1 519-720-1629

Website:                                   www.westcast.com

 

 

Company summary

 

Corporate ID#:               ON-001102475

State:                           Ontario

Judicial form:                 Corporation – Profit

Date incorporated:          10-31-1994

Name of manager:          Edward G. FRACKOWIAK

 

 

ACTIVITIES & OPERATIONS

 

History:

Business started in 1901

 

A former WESCAST INDUSTRIES INC. was incorporated in Ontario on 11-20-1946 under ID# ON-000054210, merged into the new WESCAST INDUSTRIES INC. on 10-31-1994.

 

The Company was formerly listed with the Toronto Stock Exchange and became private in September 2012.

 

Business:

Wescast Industries Inc. designs, engineers, casts, machines, and assembles exhaust system components for automotive original equipment manufacturers and other customers of the car and light truck markets in North America, Europe, Asia, Africa, South America, and Australia.

 

It offers exhaust manifolds, turbocharger housings, catalytic converter containers, integrated turbo manifolds, and other components.

 

The company was founded in 1901 and is headquartered in Brantford, Canada.

 

As of March 27, 2013, Wescast Industries Inc. operates as a subsidiary of Sichuan Bohong Industry Co. Ltd.

 

Staff:     2,000

 

Operations & branches:

At the headquarters, we find a factory, warehouse and office, owned.

 

The Company maintains 13 factories/subsidiaries worldwide.

SHAREHOLDERS & MANAGERS

 

Shareholders:

Sichuan Bohong Industry Co. Ltd.

206 Airport East Road, Fucheng, Mianyang, 621051 China

 

Management:

Edward G. FRACKOWIAK is the CEO since May 27, 2004 and also been its Chairman since May 2004.

 

Mr. Frackowiak served as an Interim Chief Executive Officer of Wescast Industries Inc. since May 27, 2004 and also served as its Executive Chairman from May 1, 2003 to 2004. Prior to Wescast Industries Inc. that, he served as a Vice President and General Counsel and Canada of First American Title Insurance Company (title insurance company).

Prior to that, he was a Partner at a Toronto based law firm.

He called to the Ontario Bar in 1984.

He has been a Director of Wescast Industries Inc. since 1992.

Mr. Frackowiak is a Member of the Canadian Bar Association and the Ontario Bar Association.

 

Richard E. LEGATE has been Chief Operating Officer of Wescast Industries Inc., since January 21, 2008 and serves as Chief Executive Officer of private and public auto parts companies.

Mr. Legate serves as the President of Active Burgess Mould & Design Ltd.

He served as a Vice President of Dofasco's tubular products group.

Prior to Wescast, he held numerous operational and executive positions in the automotive industry such as Dofasco Tubular Products Inc., Tiercon

Holdings Limited, Active and Ventra Group Inc. He has been a Director of Wescast Industries Inc., since 2008. He served as a Director of the Automotive Parts Manufacturers Association.

Mr. Legate is a graduate of the University of Waterloo and of the Executive Program at Queen's University.

 

Teresa H. FOTNEY is the CFO.

 

Subsidiaries And Partnership:

 

Weslin industries Inc.

Incorporated in Ontario on September 7, 1999

ID# ON-001373011

 

Purchased from Linamar Corporation (TSX = LNR).

Price: CAD 53.75 million

This purchase in set to close on August 31, 2014.

 

 

FINANCIALS

 

In Canada, privately held corporations are not required to publish any financials.

 

On a direct call, nobody was available to answer our questions.

 

We sent a fax but no answer received.

 

However, sales estimate for year 2013 is in the range of CAD 3,000,000,000=

 

The Company reported losses in 2012 and 2013.

 

Banks:  Royal Bank of Canada

 

 

LEGAL FILINGS

 

Legal filings & complaints:

As of today date, there is no legal filing pending with the Courts.

 

Secured debts summary:   Several

 

 

COMPANY CREDIT HISTORY

 

Trade references:

Date reported:                June 2014

High credit:                    CAD 50,000+

Now owing:                    0

Past due:                      0

Last purchase:               May 2014

Line of business:            Office supply

Paying status:               3 days beyond terms

 

Date reported:                June 2014

High credit:                    CAD 2,900,000

Now owing:                    0

Past due:                      0

Last purchase:               May 2014

Line of business:            Payroll

Paying status:               As agreed

 

Date reported:                June 2014

High credit:                    CAD 1,500

Now owing:                    0

Past due:                      0

Last purchase:              May 2014

Line of business:            Telecommunications

Paying status:               2 days beyond terms

 

 

Domestic credit history:

National Credit Bureaus gave a correct credit rating.

 

According to our credit analysts, during the last 6 months, domestic payments were made with an average of 2 to 5 days beyond terms.


 

International credit history:

Payments of imports are currently made with an average of 2 to 5 days beyond terms.

 

The Company is improving its payments, but the cash is low, due to high inventories and bad conditions of the market.

 

 

Other comments:

The Company maintains a regular business.

The bank confirmed

The Company is in good standing.

This means that all local and federal taxes were paid on due date.

 

 

Our opinion:

A business connection may be conducted.

 


FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.60.23

UK Pound

1

Rs.102.86

Euro

1

Rs.81.44

 

 

INFORMATION DETAILS

 

Analysis Done by :

SUM

 

 

Report Prepared by :

MNL

 

 

RATING EXPLANATIONS

 

RATING

STATUS

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

Credit not recommended

--

NB

                                       New Business

--

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.