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Report Date : |
09.06.2014 |
IDENTIFICATION DETAILS
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Name : |
ENERGY RESOURCES LLC |
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Registered Office : |
Central Tower, 16th Floor, 2 Sukhbaatar Square, 8 Khoroo, Sukhbaatar
District, Ulaanbaatar 14200 |
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Country : |
Mongolia |
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Financials (as on) : |
31.12.2013 |
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Date of Incorporation : |
22.04.2005 |
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Legal Form : |
Limited Liability Company |
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Line of Business : |
Producers, distributors and exporters of coal. |
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No. of Employees : |
2,200 |
RATING & COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
|
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively below
average. |
Small |
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Status : |
Moderate |
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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 – March 31, 2014
|
Country Name |
Previous Rating (31.12.2013) |
Current Rating (31.03.2014) |
|
Mongolia |
C1 |
C1 |
|
Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low Risk |
A2 |
|
Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
|
Moderately High Risk |
C1 |
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High Risk |
C2 |
|
Very High Risk |
D |
MONGOLIA - ECONOMIC OVERVIEW
Mongolia's extensive mineral deposits
and attendant growth in mining-sector activities have transformed Mongolia's
economy, which traditionally has been dependent on herding and agriculture.
Mongolia's copper, gold, coal, molybdenum, fluorspar, uranium, tin, and
tungsten deposits, among others, have attracted foreign direct investment.
Soviet assistance, at its height one-third of GDP, disappeared almost overnight
in 1990 and 1991 at the time of the dismantlement of the USSR. The following
decade saw Mongolia endure both deep recession, because of political inaction
and natural disasters, as well as economic growth, because of reform-embracing,
free-market economics and extensive privatization of the formerly state-run
economy. The country opened a fledgling stock exchange in 1991. Mongolia joined
the World Trade Organization in 1997 and seeks to expand its participation in
regional economic and trade regimes. Growth averaged nearly 9% per year in
2004-08 largely because of high copper prices globally and new gold production.
By late 2008, Mongolia was hit hard by the global financial crisis. Slower
global economic growth hurt the country's exports, notably copper, and slashed
government revenues. As a result, Mongolia's real economy contracted 1.3% in
2009. In early 2009, the International Monetary Fund reached a $236 million
Stand-by Arrangement with Mongolia and the country has largely emerged from the
crisis with better regulations and closer supervision. The banking sector
strengthened but weaknesses remain. In October 2009, Mongolia passed
long-awaited legislation on an investment agreement to develop the Oyu Tolgoi
mine, considered to be among the world's largest untapped copper-gold deposits.
Mongolia's ongoing dispute with a foreign investor over Oyu Tolgoi, however,
has called into question the attractiveness of Mongolia as a destination for
foreign direct investment. Negotiations to develop the massive Tavan Tolgoi
coal field also have stalled. The economy has grown more than 10% per year
since 2010, largely on the strength of commodity exports to nearby countries
and high government spending domestically. Mongolia's economy, however, faces
near-term economic risks from the government's loose fiscal and monetary
policies, which are contributing to high inflation, and from uncertainties in
foreign demand for Mongolian exports. Trade with China represents more than
half of Mongolia's total external trade - China receives more than 90% of
Mongolia's exports and is Mongolia's largest supplier. Mongolia has relied on
Russia for energy supplies, leaving it vulnerable to price increases; in the
first 11 months of 2013, Mongolia purchased 76% of its gasoline and diesel fuel
and a substantial amount of electric power from Russia. A drop in foreign
direct investment and a decrease in Chinese demand for Mongolia's mineral
exports are putting pressure on Mongolia's balance of payments. Remittances
from Mongolians working abroad, particularly in South Korea, are significant.
|
Source
: CIA |
CO. NAME : ENERGY RESOURCES LLC
(Correct)
ENERGY RESOURCES CO LTD (Requested)
Building : Central Tower, 16th Floor
Area : 2 Sukhbaatar Square, 8
Khoroo, Sukhbaatar District
Town : Ulaanbaatar 14200
Country : Mongolia
Telephone: (976 70) 122 279 / 132 279 / Mobile (976 88) 101 111 (Z.
Sugarmaa)
Fax : (976 70) 111 399 / 132
279
E-Mail :
batbayasakh.a@energyresources.mn /
khandmaa.z@energyresources.mn / contact@energyresources.mn
/
bayarmaa.ts@energyresources.mn /
sugarmaa.z@energyresources.mn
Website : www.energyresources.mn
Also known as : Energy Resources XXK / Energy Resources Co. Ltd
Name Position
1. B. Ariunaa Vice President
2. G. Battsengel Executive Director
3. Oyunbat Lkhagvatsend
Chief Executive Officer
4. Ts. Bayarmaa (Ms.) Procurement Manager
5. A. Batbayasakh Human Resources Manager
6. Z. Khandmaa (Ms.) Public Relation Manager
7. Z. Sugarmaa (Ms.) Public Relations Officer
Total Employees : 2,200 (subject)
8,000 (parent)
No complaints have been heard regarding payments from local suppliers or
banks.
Subject is a member of the MCS Group of Companies - one of the
largest private sector. The Group has more than 32 subsidiaries covering
diversified business activities including : energy & infrastructure,
general manufacturing & services, information & communications,
property development, and - food, beverage & alcohol. The Group had annual
sales turnover $US 250 million in 2008.
We consider it is acceptable to deal with subject for LARGE amounts,
although it is normal accepted practice for international suppliers to
deal on secured terms with Mongolian importers.
Trade risk assessment : Normal
NAME : GOLOMT BANK OF MONGOLIA
Branch : Bodi Tower, Sukhbaatar
Square
Town : Ulaanbaatar
Telephone: (976 11) 311 530
Fax : (976 11) 312 307
The company also has an account with the following banks :
1. Trade and Development Bank Mongolia Ltd
Juulnchny Gudamj 7
Ulaanbaatar 210646
Telephone: (976 11) 312 362 /
331 133
Fax : (976 11) 325 449
2. Khan Bank of Mongolia
Peace Avenue
Ulaanbaatar
Telephone: (976 11) 457 880
Fax : (976 11) 457 880
Subject does not compile its own financial statements nor issue invoices in its own name. Its financial
statements are consolidated with its parent and invoices are issued in the name
of its parent.
Balance sheets as
at 31 December of 2013 showed applies to Mongolian Mining Corporation (MMC) :
31/12/2013 31/12/2012
31/12/2011
(in
thousands HKD)
ASSETS
Current
Assets
Cash
And Cash Equivalents 77,000 284,000
228,000
Net
Receivables 145,000 131,000
92,000
Inventory 106,000 90,000 58,000
Other
Current Assets 58,000 12,000 -
Total
Current Assets 449,000 583,000
395,000
Long
Term Investments 2,000 4,000 4,000
Deferred
Long Term Asset Charges 22,000 19,000 10,000
Total
Assets 1,899,000 2,177,000 1,628,000
LIABILITES
& EQUITY
Liabilities
Current
Liabilities
Accounts
Payable 93,000 46,000
19,000
Short/Current
Long Term Debt 991,000
1,114,000 562,000
Other
Current Liabilities 72,000
81,000 94,000
Total
Current Liabilities 433,000
418,000 554,000
Long
Term Debt 744,000 842,000
145,000
Total
Liabilities 1,338,000 1,425,000
859,000
Common
Stock 646,000 646,000
646,000
Retained
Earnings 120,000 177,000
180,000
Treasury
Stock (205,000) (71,000) (57,000)
INCOME STATEMENT
Total
Revenue 437,000 474,000
543,000
Cost
of Revenue 335,000 386,000
288,000
Gross
Profit 102,000 89,000
254,000
Total
Operating Expenses 414,000
463,000 397,000
Operating
Income or Loss 23,000
11,000 146,000
Earnings
Before Interest & Taxes 23,000 11,000 146,000
Interest
Expense (61,000) (49,000) (13,000)
Income
Tax Expense 3,000 3,000 36,000
Net
Income From Continuing Ops (58,000)
(3,000) 119,000
Net
Income (58,000)
(3,000) 119,000
Financial year ends 31 December.
Date Started : 22 April 2005
History : The Company was
established in Mongolia on 22 April 2005.
Tax No.: 2887746
Government Resolution No. 299
Authorised Capital : US DLRS 150,000,370 (divided into 75,000,185
shares of US DLRS 2 each)
Paid-Up Capital : US DLRS 150,000,370 (divided into 75,000,185 shares
of US
DLRS 2 each)
Limited Liability Company with the following sole shareholder :
Mongolian Mining Corporation 100%
Central Tower, 16th Floor
Sukhbaatar District
Ulaanbaatar 14200
Telephone : (976 70) 122 279 /
132 279
Fax : (976 11) 322 279
E-Mail : contact@mmc.mn /
investor@mmc.mn / gantulga.bu@mmc.mn
Website : www.mmc.mn
Hong Kong Stock Exchange Code No.: 975
UHG mining license No.: MV-11952
Ultimate shareholder :
MCS Holding Co Ltd, founded in 1993 as the first Mongolian private
consulting company in the energy sector, the MCS Group has
successfully expanded its business operations in such diversified
fields, as energy and infrastructure, information and communication
technology, beverage manufacturing and distribution, wholesale and
retail, property development, construction and printing. The MCS
Group has 4,000 employees and has been ranked as one of the top five
taxpayers for the last consecutive years.
Personal Profile on Oyunbat Lkhagvatsend :
Oyunbat Lkhagvatsend, aged 35, is the Vice President and Chief Logistics
Officer of the Mongolian Mining Corporation. On 8 February 2011, Mr.
Lkhagvatsend was appointed as the Chief Executive Officer of Energy Resources
Rail LLC, Transgobi LLC, Tavan Tolgoi Airport LLC, Energy Resources Road LLC
and Gobi Road LLC. Mr. Lkhagvatsend has about 11 years of experience in the
business sector of Mongolia, holding senior positions in various businesses in
the country. From 2003 to 2005, Mr. Lkhagvatsend was the chief executive
officer of Newcom Group and was responsible for strategy planning and business
development. From May 2005 to December 2006, he was the president and chief
executive officer of Eznis Airways and was in charge of strategy planning,
project management and other corporate affairs. He joined the Group in 2008 as
the chief executive officer of Energy Resources Rail LLC and was responsible
for overall business strategy and planning. Mr. Lkhagvatsend was awarded a
bachelor’s degree in law from the National University of Mongolia, Mongolia. He
also underwent executive trainings held by the Michigan Business School, United
States, in 2004.
Subject is a member of the Mongolian Mining
Corporation group of companies, Mongolia, which also includes the following companies :
1. Mongolian Coal Corporation Limited
Three Pacific Place, Level 28
1 Queen’s Road East
Hong Kong
Capital : HK DLRS 1
2. Khangad Exploration LLC
Mongolia
(Holder of the mining license
MV-14493 for the BN coking coal
deposit)
3. Mongolian Coal Corporation S.A.
Luxemburg
Capital : EURO 31,000
4. Baruun Naran Limited
Gibraltar
5. Energy Resources Corporation LLC
Mongolia
Capital : US DLRS 100,000
6. Baruun Naran S.A.
Luxemburg
7. Energy Resources Rail LLC
Central Tower, 16th Floor
2 Sukhbaatar Square, 8 Khoroo,
Sukhbaatar District
Ulaanbaatar 14200
Telephone: (976 70) 122 279 /
132 279
Fax : (976 70) 111 399 / 132 279
Chief Executive Officer :
Oyunbat Lkhagvatsend
Employees: 100
Est.: 8 July 2008
Tax No.: 5241111
Capital : TUGRIK 10,700,000,000
Sole shareholder : Energy
Resources LLC
(Engages in management of
railway project and responsible for the
implementation of the
construction of the railway base
infrastructure)
8. Enrestechnology LLC
Central Tower, 16th Floor, West Wing
2 Sukhbaatar Square, 8 Khoroo,
Sukhbaatar District
Ulaanbaatar 210620a
Telephone: (976 70) 122 279
Fax : (976 70) 132 279
Chief Executive Officer :
Davaakhuu Chultem
Est.: 25 June 2009
Tax No.: 3614107
Capital : 3,466,163,000
9. Energy Resources Mining LLC
Central Tower, 15th Floor
2 Sukhbaatar Square, 8 Khoroo,
Sukhbaatar District
Ulaanbaatar 210620a
Telephone: (976 70) 122 279
Fax : (976 70) 132 279
Est.: 23 December 2008
Capital : US DLRS 1,000
(Responsible for the mining and
technical operations of the UHG
deposit)
10.Transgobi LLC
Mongolia
Capital : TUGRIK 9,122,641,836
11.Tavan Tolgoi Airport LLC
Mongolia
Capital : TUGRIK 3,475,379,000
12.Energy Resources Road LLC
Mongolia
Capital : TUGRIK 1,000,000
13.International Medical Center LLC
Mongolia
14.International Technical College LLC
Mongolia
15.Ukhaa Khudag Water Supply LLC (frmly United Water LLC)
Mongolia
Est.: 24 June 2009
Capital : TUGRIK 1,000,000
16.United Power LLC
Mongolia
Capital : TUGRIK 3,025,219,000
17.Gobi Road LLC
Mongolia
Capital : TUGRIK 1,000,000
18.Public Service LLC
Mongolia
Capital : TUGRIK 20,000,000
The Company is involved in the following activities :
Producers, distributors and exporters of coal.
NACE Code : 510
Annual production capacity :
- 2009 : 1.8 Million Tons;
- 2010 : 3.9 Million Tons;
- 2011 : 7.1 Million Tons;
- 2012 : 8.6 Million Tons;
- 2013 : 9.7 Million Tons.
Imports from China and South Korea.
Exports mainly to China.
The Company has the following facilities :
Owned administrative offices located at the heading address as well as
two offices located in Ummgobi Aimag and Beijing (see ‘Branch Offices’ below).
1. Ukhaa Khudag Branch
Ukhaa Khudag
Tsogttsetsii soum
Umnugobi Aimag 46040
Mongolia
Telephone: (976 77) 202 279
2. Beijing Representative Office
Beijing Yintai Center, Tower C,
Jianguomenwai No.2, 22nd Floor
2203A, Chaoyang District,
Beijing
China 100022
Telephone: (86 10) 6506 8528 /
7722 2282
Fax : (86 10) 6506 8598
You enquired on : ENERGY RESOURCES CO LTD. Please note
that subject is also known by this name. Subject's correct registered name is
as per heading.
Interviewed : Z.
Sugarmaa (Ms.) (Public Relations Officer).
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.59.20 |
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|
1 |
Rs.99.52 |
|
Euro |
1 |
Rs.80.83 |
INFORMATION DETAILS
|
Analysis Done by
: |
DIV |
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Report Prepared by
: |
NNA |
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or
its officials.