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Report Date : |
23.05.2014 |
IDENTIFICATION DETAILS
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Name : |
SCOPE METALS
GROUP LTD. |
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Formerly Known As : |
SCOPE METALS TRADING AND TECHNICAL SERVICES LTD |
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Registered Office : |
P.O. Box 3, 3 Hamerkava Street, Re'em Industrial Zone, Bnei Ayish 6086000 |
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Country : |
Israel |
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Financials (as on) : |
31.03.2014 (Consolidated) |
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Date of Incorporation : |
27.04.1980 |
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Com. Reg. No.: |
52-003742-5 |
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Legal Form : |
Public Limited Liability Company |
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Line of Business : |
· Subject is a global distributor and industrial metal supply center, handling a wide range of metals & engineering plastic products under one roof. Subject operate as trades, importers, exporters and
marketers in the alloys “white metal” area, including Steel & Stainless
Steel, Aluminum, Copper, Bronze, Brass, Titanium, Lead and Zinc. Subject product ranges include pipes, bolts & nuts,
fittings, welding equipment, nets and cables, fasteners & plates, for the
various industries and construction. |
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No of Employees : |
624 employees
serving whole SCOPE Group (had 595 employees in end of 2012), of which 310
employees in subject itself, in Israel. |
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 : |
Satisfactory |
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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
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Country Name |
Previous Rating (31.12.2013) |
Current Rating (31.03.2014) |
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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 Risk |
A2 |
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Moderate Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderate High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
Israel ECONOMIC OVERVIEW
Israel has a technologically advanced market economy. Cut
diamonds, high-technology equipment, and pharmaceuticals are among the leading
exports. Its major imports include crude oil, grains, raw materials, and
military equipment. Israel usually posts sizable trade deficits, which are
covered by tourism and other service exports, as well as significant foreign
investment inflows. Between 2004 and 2011, growth averaged nearly 5% per year,
led by exports. 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. 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. The economy has recovered better
than most advanced, comparably sized economies, but slowing demand domestically
and internationally, and a strong shekel, have reduced forecasts for the next
decade to the 3% level. Natural gas fields discovered off Israel's coast since
2009 have brightened Israel's energy security outlook. The Tamar and Leviathan
fields were some of the world's largest offshore natural gas finds this past
decade. The massive Leviathan field is not due to come online until 2018, but
production from Tamar provided a one percentage point boost to Israel's GDP in
2013 and is expected to contribute 0.5% growth in 2014. In mid-2011, public
protests arose around income inequality and rising housing and commodity
prices. Israel's income inequality and poverty rates are among the highest of
OECD countries and there is a broad perception among the public that a small
number of "tycoons" have a cartel-like grip over the major parts of
the economy. 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. In May 2013 the Israeli government, in a politically difficult
process, passed an austerity budget to reign in the deficit and restore
confidence in the government's fiscal position. Over the long term, Israel
faces structural issues, including low labor participation rates for its
fastest growing social segments - the ultra-orthodox and Arab-Israeli
communities. Also, Israel's progressive, globally competitive, knowledge-based
technology sector employs only 9% of the workforce, with the rest employed in
manufacturing and services - sectors which face downward wage pressures from
global competition.
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Source : CIA |
SCOPE METALS GROUP LTD.
Telephone 972 8 863 10 00
Fax 972 8 863 10 20
Email: info@scope.co.il
P.O. Box 3
3 Hamerkava Street
Re'em Industrial
Zone
BNEI AYISH 6086000 ISRAEL
Originally
incorporated as a private limited company, registered as per file No.
51-084980-5 on the 27.04.1980.
Converted into a public limited liability
company, registered as per file No. 52-003742-5 on the 30.04.1992 and in
parallel published a prospectus, offering shares to the public, raising a sum
of US$ 2.5 million.
Originally
registered under the name SCOPE TRADING & FOOD MARKETING LTD., which
changed to SCOPE METALS TRADING AND TECHNICAL SERVICES LTD. on the 05.04.1981,
which changed to the present name on the 19.08.2007.
Authorized share
capital NIS 30,000,000.00, divided into: -
30,000,000 ordinary shares of
NIS 1.00 each,
of which 10,893,871
shares amounting to NIS 10,893,871.00 were issued.
1. Shmuel Shiloh (via fully owned
company), 45%,
2. Institutional Investors: MIGDAL
INSURANCE (10%), MEITAV DASH (6.5%), YELIN LAPIDOT (7%), PSAGOT (5%),
3. Shares are also traded on the
Tel Aviv Stock Exchange.
In 2006, FIMI
Investment Fund acquired some 30% in subject, for NIS 157 million. During 2013
FIMI Fund sold its stake in subject (sold 9% to Shmuel Shiloh in May for NIS
45.1 million, then gradually sold the rest of its holdings.
1.
Shmuel Shiloh, Chairman,
2.
Matityahu (Mati) Dov,
3.
Amiram Boehm,
4.
Shalom Singer,
5.
Ms. Orna Lichtenstein,
6.
Uzi Nethanel,
7.
Dan Sion.
Gil Haver.
A global distribution
and industrial metal supply center, handling a wide range of metals &
engineering plastic products under one roof. Subject & Group operate as
trades, importers, exporters and marketers in the alloys “white metal” area,
including Steel & Stainless Steel, Aluminum, Copper, Bronze, Brass,
Titanium, Lead and Zinc.
Products include
pipes, bolts & nuts, fittings, welding equipment, nets and cables,
fasteners & plates, for the various industries and construction. Having an
inventory of over 80,000 different items.
Subject provides
also stock storage facilities, cutting and sawing services
("one-stop-shop" model).
Also operate in
the real estate field (very low volume).
Group operates via
subsidiaries abroad (USA, Czech Republic, Poland, Romania and China). 46% of
Groups sales were export (2013). Exports are to Romania, Bulgaria, Moldova,
Russia, Greece, India, Cyprus, Kenya, Egypt, Turkey and Ukraine.
95% of purchase is
import.
Among local suppliers: BETH EL ZIKHRON YAAQOV INDUSTRIES, KIDRON TRADING
& AGENCIES, etc.
Sole local agents of:
COLOMBUS STAINLESS
(PTY) LTD., ALMAC STAINLESS TUBE (PTY) LTD.,
ANDREW MENTIS
(PTY) LTD., all of South Africa,
ROLDAN S.A., of
Spain,
STAR STAINLESS
SCREW CO., of the U.S.A.,
REDAELLI TECNA
SPA, of Italy.
Subject has over
4,500 clients in Israel and some 30 customers abroad (of subject). The Group as
a whole has over 8,000 active clients abroad.
Among clientele
are: ISRAEL AEROSPACE INDUSTRIES, SIEMENS CONCENTRATED SOLAR POWER, RAFAEL
ADVANCED DEFENSE SYSTEMS, INCOMAC, GOLD BAR, M.G.T. ISRAEL TASIYOT-
MIFALEI TRIFMAN, ENERGETICA GENERAL ENGINEERING & HEAT SYSTEMS, BERMAD, A.Z. INDUSTRIES, SHATAL ENGINEERING, SELA ELECTRONICS SYSTEMS, ALUM
ESHET (OMAN), VERED EROSIA, HATECHOF ISI YOGEV, A.B.M PLASTIC INDUSTRIES, ELCON
MAMAB CONTROL INSTRUMENTS, INCO ENGIENERING SERVICES, AHARON YOSEF & SONS
PACKAGING INDUSTRIES, K & K PLASTIC ENGINEERING, MODOTEC, etc.
Operating from
premises, a site which includes owned area of 50,366 sq. meters and leased area
of 27,500 sq. meters (of which 45,000 sq. meters are built), in 3 Hamerkava
Street, Re'em Industrial Zone, Bnei Ayish, and from branches in the USA, China,
Romania, Poland, Korea and the Czech Republic.
Having 624
employees serving whole SCOPE Group (had 595 employees in end of 2012), of
which 310 employees in subject itself, in Israel.
In April 2005,
subject raised NIS 40 million by issuing shares to institutional investors.
In March 2007, subject
completed a raise of NIS 150 million by issuing bonds to institutional
investors.
Subject intended
to offer some 26% of its shares and raise US $100 million through the New York
Stock Exchange, and already submitted draft prospectus to the American SEC,
however it decided to back-off the issuance the public offering due to
unfavorable market condition.
There are no
charges registered on the company's assets.
Consolidated B/S
shows:
NIS
(thousands)
31.12.2013 31.03.2014
ASSETS
Current assets
Cash
& cash equivalents 154,663 183,484
Negotiable
securities 9,467 10,290
Customers 360,829 393,353
Other debtors 16,292 22,532
Stock 525,527 516,479
1,066,778 1,126,138
Non-current assets
Fixed assets (net) 277,391 274,900
Goodwill & intangible assets 16,222 15,837
Other non-current assets 5,644 5,886
299,257 296,623
1,366,035 1,422,761
======== ========
LIABILITIES
Current liabilities
Short-term credit from banks & current
maturities of loans from banks, bonds 227,928 260,640
Other current liabilities 173,053 186,464
400,981 447,104
Non-current liabilities
Credit from banks & others 395,644 448,674
Debentures 34,317 -
Deferred taxes 34,629 34,399
464,590 483,073
Equity 500,464 492,584
1,366,035 1,422,761
======== ========
Current market
value US$ 155 million.
REVENUES
Consolidated
Statements of Income
NIS
(thousands)
Year
ended December 31st
2011 2012 2013
Revenues 1,049,285 1,158,382 1,292,551
Gross profit 265,567 262,924 296,304
Operating income 63,473 60,199 90,679
Profits before
taxes on income 24,146 31,063 64,454
Net income 1,121 20,724 46,913
======== ======== ========
Consolidated sales for 2014 1st
quarter of were NIS 343,018,000 (7.5% increase compared to 1stQ
2013), making a gross profit of NIS 75,390,000, an operating profit of NIS
22,545,000 and a net profit of NIS 12,816,000.
ADIT INDUSTRY
BUILDINGS LTD., 100%, real estate holdings,
ILERLI TIN
PROCESSING LTD., 100%,
EL-ZON HOLDINGS
LTD., 100%, non-active,
GILINOX S.R.L.,
100%, Romania,
PRIMAPOL METAL
SPOT S.R.O., 100%, Czech Republic, owns ALINOX POLSKA Sp.z.o.o., of Poland and
ALINOX UKRAINE LTD. of Ukraine,
DALIAN BEST METALS
CO. LTD. (D.B.M.), 100%, China,
SCOPE METALS USA
INC. (formerly SHINTU), 100%, USA, fully owns 2 U.S. subsidiaries: MATERIALS
TECHNOLOGY SOLUTIONS LLC. (M.T.S.) and HADCO METAL TRADING LLC., which owns
HADCO METAL KOREA LLC.
Bank Leumi
Le’Israel Ltd., Tel Aviv Central Branch (No. 800), Tel Aviv.
Bank Hapoalim
Ltd., Rehovot Business Branch (No. 412), Rehovot.
Israel Discount
Bank Ltd., Main Branch (No. 010), Tel Aviv.
Mizrahi Tefahot
Bank Ltd., Main Business Center Branch (No. 461), Tel Aviv.
The First International
Bank of Israel Ltd., Tel Aviv Main Branch (No. 046), Tel Aviv.
Union Bank of
Israel Ltd., Ashdod Branch (No. 071), Ashdod.
Also working with:
Mercantile Discount Bank Ltd., Beit Maiya Branch (No. 656), Tel Aviv, account
No. 56782 (a check with the Central Banks' data base did not reveal negative
information regarding subject’s a/m account).
Nothing
unfavorable learned.
Subject is
considered a local leading company in the "white metals" sector.
Subject is ISO
9002 certified.
In 2002, subject
acquired all the activities (including goodwill, stock, machinery and
equipment) of 2 sister companies FEINGOLD STEEL INDUSTRIES LTD. and FEINGOLD
STEELS (1960) LTD., for a sum of US$ 3.6 million. FEINGOLD was a veteran and
well-known Group in the steel field.
In 2004 subject
acquired all stock of GLOBAL METALS, a local metal company which went into
receivership, as well as acquiring 51% of an American metal trading company
M.T.S., for a sum of US$ 500,000.
In 2004 subject
established a new subsidiary in the Czech Republic, which in 2005 acquired the
activities of a metal trading Czech company, for € 895,000.
In 2006 subject
acquired American metal trading firm through HADCO, a subsidiary established
for this purpose in the USA, for a sum of US$ 11 million.
In June 2006,
subject acquired a 10,000 sq. meters plot in Romania, for a sum of € 1 million
and invested in warehouses an additional € 1.7 million.
In December 2006 subject
reported it signed an agreement to purchase aluminum products in volume of US$
40-44 million from a European plant, in the framework of subject's
international expansion plans.
The global
economic crisis took its toll from subject during 2008/9: The decrease in the
global activity caused a decrease in demands for metals and metal’s prices fell
drastically. As a result, subject wrote-off total of NIS 42.6 million for
inventory value in its financial statements in 2008. Subject took streamlining
measures, which included a cut-back in its workforce in Israel and abroad,
salary cuts and stock decreasing. The measures, coupled with the recovery in
global and local markets lead to an improvement in subject’s performance – as
may be seen in the 2010, 2011 and 2012 results.
In December 2009 it was reported that subject will install a solar system
by GINERGIA on the roofs of its plant for NIS 1 million, and will further
install a larger system for some NIS 20 million.
According
to data by of the Metal, Electrical and Infrastructure Industries Association,
representing the local Metal and Electricity Industries, which includes large
scale export-oriented industries on one hand and family-owned plants which sell
to the local market: 2010 sales (local and export) by the said industries
amounted to NIS 70 billion, comprising 25% of Israel's industrial output. Sales for export
reached US$ 10 billion in 2010.
Some 90,000
employees serve the said industries (26% of Israel's industrial workforce).
Export by local Manufacturing
of Basic Metals continued the negative trend of 2012 (when it fell 11% in from
2011), with a decrease by 20.6% in 2013, to US$ 743 million (decrease was
sharper in local NIS currency terms – by 25.5%).
In the
Manufacturing of Fabricated Metal Products, Machinery & Equipment and
Domestic Appliances, export level rose marginally in 2013 (0.6%, though fell 6%
in local NIS currency terms) to US$ 5,101.5 million, after 10%
increase in 2012.
The
Central
Bureau of Statistics (CBS) data on import of metals raw materials to the local industries: Import of Iron and Steel
in 2013 kept the negative trend from 2012 after a remarkable recovery in the
years 2010 and 2011 from 2009 with decreased by 2.3% reaching US$ 2,127 million
(fell 11.5% in 2012, after rising by over 30% per year in 2010 and in 2011); On
the other hand, import of Precious Metals rose by 7.3% in 2013 to US$ 157
million (fell 13% in 2012 after rising by 2% in 2011 and 22.5% in 2010), and
import of Non-ferrous Metals increased by 6% to US$ 850 million (after a 13%
fall in 2012 and rise by 20% in 2011 and by 41% in 2010).
The
CBS data on investment in imported machinery and other equipment for the
manufacturing industry in 2013 (comparing to 2012): investments in the
manufacture of basic metal was NIS 157.2 million (4.5% rise, after 35% decrease
in 2012); investments in the manufacture of fabricated metal products was NIS
646.8 million, falling by 13.3%, after rising by 4.7% in 2012.
Good for trade engagements.
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.58.57 |
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UK Pound |
1 |
Rs.98.88 |
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Euro |
1 |
Rs.80.05 |
INFORMATION DETAILS
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Analysis Done by
: |
SUB |
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Report Prepared
by : |
MNL |
RATING EXPLANATIONS
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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 |
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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 |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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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 |
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-- |
NB |
New Business |
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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.