MIRA INFORM REPORT

Report No. :	313831
Report Date :	09.04.2015

IDENTIFICATION DETAILS

Name :	LEVI STRAUSS JAPAN
Registered Office :	1-1-1 Minamiaoyama Minatoku Tokyo 107-0062
Country :	Japan
Financials (as on) :	30.11.2013
Date of Incorporation :	November 1972
Legal Form :	Limited Company (Kabushikikaisha)
Line of Business :	Import/ Wholesale/Mfg of clothing
No. of Employee :	82

RATING & COMMENTS

MIRA’s Rating :

B

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Status :	Moderate
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 – December 31, 2014

Country Name	Previous Rating (30.09.2014)	Current Rating (31.12.2014)
Japan	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

JAPAN ECONOMIC OVERVIEW

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A small agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. While self-sufficient in rice production, Japan imports about 60% of its food on a caloric basis. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient INVESTMENT and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession three times since 2008. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan into recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake and the ensuing tsunami in March disrupted manufacturing. The economy has largely recovered in the two years since the disaster, but reconstruction in the Tohoku region has been uneven. Prime Minister Shinzo ABE has declared the economy his government's top priority; he has overturned his predecessor's plan to permanently close nuclear power plants and is pursuing an economic revitalization agenda of fiscal stimulus, monetary easing, and structural reform. Japan joined the Trans Pacific Partnership negotiations in 2013, a pact that would open Japan's economy to increased foreign competition and create new export opportunities for Japanese businesses. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2013 stood as the fourth-largest economy in the world after second-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. The new government will continue a longstanding debate on restructuring the economy and reining in Japan's huge government debt, which is exceeding 230% of GDP. To help raise government revenue and reduce public debt, Japan decided in 2013 to gradually increase the consumption tax to a total of 10% by the year 2015. Japan is making progress on ending deflation due to a weaker yen and higher energy costs, but reliance on exports to drive growth and an aging, shrinking population pose other major long-term challenges for the economy.

Source : CIA

Company name and address

ENGLISH COMPANY NAME	LEVI STRAUSS JAPAN
Japanese company name	LEVI STRAUSS JAPAN KK
Registered Office
1. Street Number and District	1-1-1 Minamiaoyama Minatoku
2. City and Perefecture	Tokyo
3. ZIP Code	107-0062
4. Country	JAPAN
TEL	03-5786-5600
FAX	Information not available
URL	www.levistrauss.co.jp
Email Address	N/A
Activities (Services & Products)	Import/ Wholesale/Mfg of clothing.
SUMMARY OF REPORT
Annual Sales (MM YEN)	10,810
Capital Amount (MM YEN)	5,213
Net Worth (MM YEN)	1,413
FINANCES	SLOW
TREND	SLOW
EMPLOYEES	82
OTHER INFORMATION FOLLOWS:
Year Started	1972
Year Registered	Nov. 1972
Regd No	0104-01-092891
Legal Status	Limited Company (Kabushikikaisha)
Major Shareholders
1	Levi Strauss&Company (83.59%)
2	Nippin Life Insurance Company (0.57%)
3	Other
Number of Shareholders	1,241
Authorized Shares (MM)	100.8
Issued Shares (MM)	28.95
Executives
PRESIDENT	PASCAL SENKOV
Vice President	Walter Etolin
Director	Roy Bagattini
Director	Shunsuke Hasegawa
Main Banks
1	SMBC (Aoyama)
2	Mizuho Trust & Bank (Shibuya)
Relations	Satisfactory
Clients
1	Right-On
2	Jeans Mate
3	Eiko Shoji Corp
4	Aoyama Shoji Corp
5	Other
Suppliers
1	Levi Strauss Global Trading Co., Ltd.
2	Levi Strauss Asia Pacific Division Ltd.
3	Other
4
5
Branches
1	Osaka
2	Hiratsuka
Factories
1	None
Overseas
1	U.S.A.
2	Canada
3	Other
HIGHLIGHT and COMMENT	The subject company is the Japanese subsidiary of a US-based apparel maker, LEVI STRAUSS. It was founded in 1853 when Levi Strauss came from Buttenhein, Bravia, to San Francisco. It is a privately held American clothing company known worldwide for its Levi's brand of denim jeans. LEVI STRAUSS JAPAN was established in 1972 for providing Levi's brand clothes in Japan.
FINANCIAL information	The sales volume for Nov/2014 fiscal term amounted to Yen 10,810 million, a 17% up from Yen 9,205 million in the previous term. The recurring profit was posted at Yen -932 million and the net profit at Yen -1,034 million, respectively, compared with Yen -611 million recurring profit and Yen -685 million net profit, respectively, a year ago. For the term that ended Nov 2015 the recurring profit was projected at Yen -440 million and the net profit at Yen -500 million, respectively, on a 1.7% rise in turnover, to Yen 11,000 million. Final results are yet to be released. The financial situation is considered slow but still good for ORDINARY business engagements as long as the parent company, Levi Strauss & Co. in USA supports the Japan subsidiary. Key figures for Levi Strauss & Co in 2014 fiscal year are as follows: Sales: US$4,753 million Recurring Profit: US$282 million Net Profit: US$106 million Net Worth: US154 million Max credit limit is estimated at Yen 160.2 million, on 30 days normal terms.
PLEASE ATTACH THE FINANCIALS BELOW.
Terms Ending	Annual Sales*	R.Profit*		N.Profit*	S.Growth	Net Worth*
30/11/2011	8,905	-1,253		-1,711	(%)	4,415
30/11/2012	9,283	330		-1,281	4.24	3,133
30/11/2013	9,205	-611		-685	-0.84	2,447
30/11/2014	10,810	-932		-1,034	17.44	1,413
30/11/2015	11,000	-440		-500	1.76	913
Forecast (or estimated) figures for 2015 term.					*..Unit: Million Yen
FINANCES: (Consolidated in million yen)
		Terms Ending:		30/11/2014	30/11/2013
INCOME STATEMENT
	Annual Sales			10,810	9,205
	Cost of Sales			6,945	5,148
	GROSS PROFIT			3,865	4,057
	Selling & Adm Costs			4,887	4,755
	OPERATING PROFIT			-1,022	-698
	Non-Operating P/L			90	87
	RECURRING PROFIT			-932	-611
	NET PROFIT			-1,034	-685
BALANCE SHEET
	Cash			828	2,016
	Receivables			1,255	1,099
	Inventory			2,241	1,663
	Securities, Marketable
	Other Current Assets			396	271
	TOTAL CURRENT ASSETS			4,720	5,049
	Property & Equipment			210	365
	Intangibles			12	13
	Investments, Other Fixed Assets			164	161
	TOTAL ASSETS			5,106	5,588
	Payables			1,568	1,112
	Short-Term Bank Loans
	Other Current Liabs			1,872	1,727
	TOTAL CURRENT LIABS			3,440	2,839
	Debentures
	Long-Term Bank Loans
	Reserve for Retirement Allw			114	169
	Other Debts			139	133
	TOTAL LIABILITIES			3,693	3,141
	MINORITY INTERESTS
	Common stock			5,213	5,213
	Additional paid-in capital			1,541	1,541
	Retained earnings			(5,320)	(4,286)
	Evaluation p/l on investments/securities
	Others			0	0
	Treasury stock, at cost			(21)	(21)
	TOTAL S/HOLDERS` EQUITY			1,413	2,447
	TOTAL EQUITIES			5,106	5,588
CONSOLIDATED CASH FLOWS
			Terms ending:	30/11/2014	30/11/2013
	Cash Flows from Operating Activities			-1,261	n/a
	Cash Flows from Investment Activities			74	n/a
	Cash Flows from Financing Activities			0	n/a
	Cash, Bank Deposits at the Term End			527	n/a
ANALYTICAL RATIOS Terms ending:				30/11/2014	30/11/2013
			Net Worth (S/Holders' Equity)	1,413	2,447
			Current Ratio (%)	137.21	177.84
			Net Worth Ratio (%)	27.67	43.79
			Recurring Profit Ratio (%)	-8.62	-6.64
			Net Profit Ratio (%)	-9.57	-7.44
			Return On Equity (%)	-73.18	-27.99

FINANCES (Consolidated in million yen)
		Terms Ending:	30/11/2014	30/11/2013	IND/11/2014
INCOME STATEMENT
	Annual Sales		10,810	9,205
	Cost of Sales		6,945	5,148
	GROSS PROFIT		3,865	4,057	0
	Selling & Adm Costs		4,887	4,755
	OPERATING PROFIT		-1,022	-698	0
	Non-Operating P/L		90	87
	RECURRING PROFIT		-932	-611	0
	NET PROFIT		-1,034	-685
BALANCE SHEET
	Cash		828	2,016
	Receivables		1,255	1,099
	Inventory		2,241	1,663
	Securities, Marketable
	Other Current Assets		396	271	0
	TOTAL CURRENT ASSETS		4,720	5,049
	Property & Equipment		210	365
	Intangibles		12	13
	Investments, Other Fixed Assets		164	161	0
	TOTAL ASSETS		5,106	5,588
	Payables		1,568	1,112
	Short-Term Bank Loans
	Other Current Liabs		1,872	1,727	0
	TOTAL CURRENT LIABS		3,440	2,839
	Debentures
	Long-Term Bank Loans
	Reserve for Retirement Allw		114	169
	Other Debts		139	133	0
	TOTAL LIABILITIES		3,693	3,141
	MINORITY INTERESTS				..
	Common stock		5,213	5,213
	Additional paid-in capital		1,541	1,541
	Retained earnings		(5,320)	(4,286)
	Evaluation p/l on investments/securities
	Others		0	0	0
	Treasury stock, at cost		(21)	(21)
	TOTAL S/HOLDERS` EQUITY		1,413	2,447
	TOTAL EQUITIES		5,106	5,588	0
CONSOLIDATED CASH FLOWS
		Terms ending:	30/11/2014	30/11/2013	30/11/2012
	Cash Flows from Operating Activities		-1,261	n/a
	Cash Flows from Investment Activities		74	n/a
	Cash Flows from Financing Activities		0	n/a
	Cash, Bank Deposits at the Term End		527	n/a
ANALYTICAL RATIOS Terms ending:			30/11/2014	30/11/2013	IND/11/2014
		Net Worth (S/Holders' Equity)	1,413	2,447	0
		Current Ratio (%)	137.21	177.84	#DIV/0!
		Net Worth Ratio (%)	27.67	43.79	#DIV/0!
		Recurring Profit Ratio (%)	-8.62	-6.64	#DIV/0!
		Net Profit Ratio (%)	-9.57	-7.44	#DIV/0!
		Return On Equity (%)	-73.18	-27.99	#DIV/0!
Notes: Audited by CPA. IND/xx/yyyy.. Non-consolidated figures for (xx month)/(yyyy year) term.
		Current Sales	10,810
		Credit Limit	160.2

Business	Terms Ending	Annual Sales*	R.Profit*	N.Profit*	S.Growth	Net Worth*
Results:	30/11/2011	8,905	-1,253	-1,711	(%)	4,415
(Consolidated)	30/11/2012	9,283	330	-1,281	4.24	3,133
	30/11/2013	9,205	-611	-685	-0.84	2,447
	30/11/2014	10,810	-932	-1,034	17.44	1,413
	30/11/2015	11,000	-440	-500	1.76	913
	Forecast (or estimated) figures for 2015 term.				*..Unit: Million Yen

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.26
UK Pound	1	Rs.92.49
Euro	1	Rs.66.99

INFORMATION DETAILS

Analysis Done by :	DIV
Report Prepared by :	ANK

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%)

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