MIRA INFORM REPORT

 

 

Report No. :

335105

Report Date :

04.08.2015

 

IDENTIFICATION DETAILS

 

Name :

OSMOSIS NUTRITION SDN. BHD.

 

 

Registered Office :

2-1, Jalan Sri Hartamas 8, Sri Hartamas, 50480 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2013

 

 

Date of Incorporation :

04.10.2002

 

 

Com. Reg. No.:

594876-A

 

 

Legal Form :

Private Limited (Limited by Share)

 

 

Line of Business :

Manufacturing and Distribution of Animal Feed and Nutrition Products.

 

 

No. of Employees :

30 [2015]

 

 

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 – March 31, 2015

 

Country Name

Previous Rating

(31.12.2014)

Current Rating

(31.03.2015)

Malaysia

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

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 previously 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. Falling global oil prices in the second half of 2014 have strained government finances, shrunk Malaysia’s current account surplus and put downward pressure on the ringgit. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplied about 29% of government revenue in 2014. 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. Malaysia is a member of the 12-nation Trans-Pacific Partnership free trade agreement negotiations and, with the nine other ASEAN members, will form the ASEAN Economic Community in 2015.

 

Source : CIA

EXECUTIVE SUMMARY

 

 

REGISTRATION NO.

:

594876-A

COMPANY NAME

:

OSMOSIS NUTRITION SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

04/10/2002

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED (LIMITED BY SHARE)

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

2-1, JALAN SRI HARTAMAS 8, SRI HARTAMAS, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

LOT 16014 (PT 24341), JALAN NILAM 3, BANDAR NILAI UTAMA (NILAI 3), NILAI UTAMA ENTERPRISE PARK, 71800 NILAI, NEGERI SEMBILAN, MALAYSIA.

TEL.NO.

:

06-7999090

FAX.NO.

:

06-7997070

EMAIL

:

INFO@PETERLABS.COM.MY

WEB SITE

:

WWW.PETERLABS.COM.MY

CONTACT PERSON

:

LIM TONG SENG ( MANAGING DIRECTOR )

INDUSTRY CODE

:

10800

PRINCIPAL ACTIVITY

:

MANUFACTURING AND DISTRIBUTION OF ANIMAL FEED AND NUTRITION PRODUCTS

AUTHORISED CAPITAL

:

MYR 5,000,000.00 DIVIDED INTO
ORDINARY SHARE 5,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 1,500,002.00 DIVIDED INTO
ORDINARY SHARES 1,500,002 CASH OF MYR 1.00 EACH.

SALES

:

MYR 18,200,934 [2013]

NET WORTH

:

MYR 5,293,760 [2013]

STAFF STRENGTH

:

30 [2015]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

POOR

PAYMENT

:

AVERAGE

MANAGEMENT CAPABILITY

:

AVERAGE

COMMERCIAL RISK

:

MODERATE

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

SATISFACTORY

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

 


 

HISTORY/ BACKGROUND

 

The Subject is a private limited company and is allowed to have a minimum of one and a maximum of forty-nine shareholders. As a private limited company, the Subject must have at least two directors. A private 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, sue or be sued by other companies. The liabilities of the shareholders are 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 the company must file its annual returns, together with its financial statements with the Registrar of Companies.

 

The Subject is principally engaged in the (as a / as an) manufacturing and distribution of animal feed and nutrition products.

 

The Subject is not listed on Bursa Malaysia (Malaysia Stock Exchange).

 

The immediate holding company of the Subject is PLON SYNERGY GROUP SDN. BHD., a company incorporated in MALAYSIA.

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

15/02/2013

MYR 5,000,000.00

MYR 1,500,002.00

18/12/2002

MYR 1,000,000.00

MYR 500,002.00

04/10/2002

MYR 1,000,000.00

MYR 2.00

 

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


Current Shareholder(s) :

Name

Address

IC/PP/Loc No

Shareholding

(%)

PLON SYNERGY GROUP SDN. BHD.

16014 (PT 24341), JALAN NILAM 3, BANDAR NILAI UTAMA, 71800 NILAI, NEGERI SEMBILAN, MALAYSIA.

598746V

1,500,002.00

100.00

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

------

1,500,002.00

100.00

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

=====

+ Also Director


DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. TEO KOOI CHENG

Address

:

18, JALAN BK 6B/2, BANDAR KINRARA, 47100 PUCHONG, SELANGOR, MALAYSIA.

IC / PP No

:

5710011

New IC No

:

590905-01-5577

Date of Birth

:

05/09/1959

Nationality

:

MALAYSIAN

Date of Appointment

:

26/09/2008

 

DIRECTOR 2

 

Name Of Subject

:

MR. TEO CHIN HENG

Address

:

2, JALAN BIRAI U8/71, BUKIT JELUTONG, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

IC / PP No

:

4377126

New IC No

:

530123-04-5451

Date of Birth

:

23/01/1953

Nationality

:

MALAYSIAN

Date of Appointment

:

15/10/2002

 

DIRECTOR 3

 

Name Of Subject

:

MR. LIM TONG SENG

Address

:

2, JALAN BSJ 5, TAMAN BUKIT SEGAR JAYA 2, 43200 BALAKONG, SELANGOR, MALAYSIA.

IC / PP No

:

5806219

New IC No

:

591104-05-5397

Date of Birth

:

04/11/1959

Nationality

:

MALAYSIAN

Date of Appointment

:

04/10/2002


MANAGEMENT

 

 

 

1)

Name of Subject

:

LIM TONG SENG

Position

:

MANAGING DIRECTOR

 

 

 

AUDITOR

 

Auditor

:

TAN TIN & CO.

Auditor' Address

:

3.09, PODIUM BLOCK PLAZA BERJAYA, 12, JALAN IMBI, TINGKAT 3, KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. WONG KEO ROU

IC / PP No

:

A2132756

New IC No

:

720330-01-5404

Address

:

36, JALAN 20/5, PARAMOUNT GARDEN, 46300 PETALING JAYA, SELANGOR, MALAYSIA.

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

 

 

 

ENCUMBRANCE (S)


No encumbrance was found in our databank at the time of investigation.

 

 

LITIGATION 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.

No blacklisted record & debt collection case was found in our defaulters' databank.

 

PAYMENT RECORD

 

 

SOURCES OF RAW MATERIALS:

Local

:

YES

Overseas

:

YES


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

[

]

Good 31-60 Days

[

]

Average 61-90 Days

[

X

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

 

CLIENTELE

 

Local

:

YES

Percentage

:

100%

Domestic Markets

:

MALAYSIA

Overseas

:

NO

Credit Term

:

30 - 60 DAYS

Payment Mode

:

CHEQUES

 

 

OPERATIONS

 

Products manufactured

:

ANIMAL NUTRITION

Competitor(s)

:

DINDINGS SOYA & MULTIFEEDS SDN BHD
FFM (SABAH) SDN BHD
GOLD COIN FEEDMILLS (MALAYSIA) SDN BHD
GYMTECH FEEDMILL (M) SDN BHD
PK AGRO-INDUSTRIAL PRODUCTS (M) SDN. BHD.

Ownership of premises

:

LEASED/RENTED

 

Total Number of Employees:

 

YEAR

2015

2014

2013

2012

2011


GROUP

N/A

N/A

N/A

N/A

N/A

COMPANY

30

25

25

25

25

 

Branch

:

NO

 

Other Information:


The Subject is principally engaged in the (as a / as an) manufacturing and distribution of animal feed and nutrition products.

The Subject produces varieties of animal health products, animal nutritional feed additive and veterinary pharmaceutical products to serve the livestock industry.

We were informed that the Subject has research and development team to formulate nutrition feed additive and established the technical cooperation with oversea expert in order to develop a new balance diet for the livestock, and thus enhancing the output of the farm productivity.


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

067999090

Current Telephone Number

:

06-7999090

Match

:

YES

Address Provided by Client

:

LOT 1614, JALAN NILAM 3, NILAI UTAMA ENTERPRISE PARK, BANDAR NILAI UTAMA, 71800 NILAI, NEGERI SEMBILAN, DK MALAYSIA.

Current Address

:

LOT 16014 (PT 24341), JALAN NILAM 3, BANDAR NILAI UTAMA (NILAI 3), NILAI UTAMA ENTERPRISE PARK, 71800 NILAI, NEGERI SEMBILAN, MALAYSIA.

Match

:

NO

Latest Financial Accounts

:

YES

 

Other Investigations


We contacted one of the staff from the Subject and she provided some information.

The address provided also can be used for the Subject.


FINANCIAL ANALYSIS

 

Profitability

Turnover

:

Decreased

[

2009 - 2013

]

Profit/(Loss) Before Tax

:

Decreased

[

2009 - 2013

]

Return on Shareholder Funds

:

Unfavourable

[

(13.35%)

]

Return on Net Assets

:

Unfavourable

[

(5.25%)

]

The continuous fall in turnover could be due to the lower demand for the Subject's products / services.The Subject incurred losses during the year due to the inefficient control of its operating costs. The Subject's unfavourable returns on shareholders' funds indicate the management's inefficiency in utilising its assets to generate returns.

Working Capital Control

Stock Ratio

:

Favourable

[

36 Days

]

Debtor Ratio

:

Favourable

[

1 Days

]

Creditors Ratio

:

Favourable

[

22 Days

]

The Subject's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. 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

:

Unfavourable

[

0.17 Times

]

Current Ratio

:

Unfavourable

[

0.54 Times

]

A low liquid ratio means that the Subject may be facing working capital deficiency. If the Subject cannot obtain additional financing or injection of fresh capital, it may face difficulties in meeting its short term obligations.

Solvency

Interest Cover

:

Unfavourable

[

(2.06 Times)

]

Gearing Ratio

:

Acceptable

[

0.95 Times

]

The Subject incurred losses in the year. It did not generate sufficient income to service its interest.  If the situation does not improve, the Subject may be vulnerable to default in servicing the interest. 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 :

The Subject's losses could be attributed to the lower turnover which in turn could be the result of unfavourable market conditions. Due to its weak liquidity position, the Subject will be faced with problems in meeting all its short term obligations if no short term loan is obtained or additional capital injected into the Subject. The Subject's interest cover was negative, indicating that it did not generate sufficient income to service its interest. If its result does not show impressive improvements or succeed obtaining short term financing or capital injection, it may not be able to service its interest and repay the loans. 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 : POOR

 

 

 

MALAYSIA ECONOMIC / INDUSTRY OUTLOOK

 

Major Economic Indicators:

2011

2012

2013

2014*

2015**

Population ( Million)

28.7

29.3

29.8

30.3

30.5

Gross Domestic Products ( % )

5.1

5.6

5.3

6.0

6.0

Domestic Demand ( % )

8.2

9.4

5.6

6.4

6.2

Private Expenditure ( % )

8.2

8.0

8.6

7.9

6.9

Consumption ( % )

7.1

1.0

5.7

6.5

5.6

Investment ( % )

12.2

11.7

13.3

12.0

10.7

Public Expenditure ( % )

8.4

13.3

4.4

2.3

4.2

Consumption ( % )

16.1

11.3

(1.2)

2.1

3.8

Investment ( % )

(0.3)

15.9

4.2

2.6

4.7

Balance of Trade ( MYR Million )

116,058

106,300

71,298

52,314

-

Government Finance ( MYR Million )

(45,511)

(42,297)

(39,993)

(37,291)

-

Government Finance to GDP / Fiscal Deficit ( % )

(5.4)

(4.5)

(4.0)

(3.5)

(3.0)

Inflation ( % Change in Composite CPI)

3.1

1.6

2.5

3.2

4.0

Unemployment Rate

3.3

3.2

3.0

2.9

3.0

Net International Reserves ( MYR Billion )

415

427

-

417

-

Average Risk-Weighted Capital Adequacy Ratio ( % )

3.50

2.20

-

4.00

-

Average 3 Months of Non-performing Loans ( % )

14.80

14.70

-

-

-

Average Base Lending Rate ( % )

6.60

6.53

6.53

6.85

-

Business Loans Disbursed( % )

15.3

32.2

-

56.0

-

Foreign Investment ( MYR Million )

23,546.1

26,230.4

38,238.0

43,486.6

-

Consumer Loans ( % )

-

-

-

-

-

Registration of New Companies ( No. )

45,455

45,441

46,321

49,144

-

Registration of New Companies ( % )

3.0

(0.0)

1.9

6.1

-

Liquidation of Companies ( No. )

132,485

17,092

26,430

21,753

-

Liquidation of Companies ( % )

417.8

(87.1)

54.6

(17.7)

-

Registration of New Business ( No. )

284,598

324,761

329,895

332,723

-

Registration of New Business ( % )

5.0

14.0

2.0

1.0

-

Business Dissolved ( No. )

20,121

20,380

18,161

21,436

-

Business Dissolved ( % )

1.9

1.3

(10.9)

18.0

-

Sales of New Passenger Cars (' 000 Unit )

535.1

552.2

576.7

598.4

610.3

Cellular Phone Subscribers ( Million )

35.3

38.5

43.0

43.8

-

Tourist Arrival ( Million Persons )

24.7

25.0

25.7

28.0

-

Hotel Occupancy Rate ( % )

60.6

62.4

62.6

63.2

-

Credit Cards Spending ( % )

15.6

12.6

-

13.5

-

Bad Cheque Offenders (No.)

32,627

26,982

28,876

-

-

Individual Bankruptcy ( No.)

19,167

19,575

21,984

-

-

Individual Bankruptcy ( % )

5.8

2.1

12.3

-

-



INDUSTRIES ( % of Growth ):

2011

2012

2013

2014*

2015**

Agriculture

5.8

1.0

2.1

3.8

3.1

Palm Oil

10.8

(0.3)

2.6

6.7

-

Rubber

6.1

(7.9)

(10.1)

(10.4)

-

Forestry & Logging

(7.6)

(4.5)

(7.8)

(4.2)

-

Fishing

2.1

4.3

1.6

2.7

-

Other Agriculture

7.1

6.4

8.2

6.2

-

Industry Non-Performing Loans ( MYR Million )

634.1

-

-

-

-

% of Industry Non-Performing Loans

3.2

-

-

-

-

Mining

(5.4)

1.4

0.9

(0.8)

2.8

Oil & Gas

(1.7)

-

-

3.0

-

Other Mining

-

-

-

46.6

-

Industry Non-performing Loans ( MYR Million )

46.5

-

-

-

-

% of Industry Non-performing Loans

0.1

-

-

-

-

Manufacturing #

4.7

4.8

3.4

6.4

5.5

Exported-oriented Industries

4.1

6.5

3.3

5.6

-

Electrical & Electronics

(4.0)

12.7

6.9

13.3

-

Rubber Products

20.7

3.0

11.7

(0.3)

-

Wood Products

(5.1)

8.7

(2.7)

5.1

-

Textiles & Apparel

13.2

(7.1)

(2.6)

11.5

-

Domestic-oriented Industries

10.7

1.7

6.8

9.4

-

Food, Beverages & Tobacco

4.80

2.70

3.60

6.13

6.13

Chemical & Chemical Products

10.0

10.8

5.6

1.4

-

Plastic Products

3.8

-

-

2.7

-

Iron & Steel

2.2

(6.6)

5.0

0.1

-

Fabricated Metal Products

21.8

13.8

9.9

2.9

-

Non-metallic Mineral

12.1

2.9

(2.0)

5.4

-

Transport Equipment

12.0

3.4

13.8

22.9

-

Paper & Paper Products

9.5

3.1

1.8

4.7

-

Crude Oil Refineries

9.3

-

-

13.0

-

Industry Non-Performing Loans ( MYR Million )

6,537.2

-

-

-

-

% of Industry Non-Performing Loans

25.7

-

-

-

-

Construction

4.7

18.6

10.9

12.7

10.7

Industry Non-Performing Loans ( MYR Million )

3,856.9

-

-

-

-

% of Industry Non-Performing Loans

10.2

-

-

-

-

Services

7.1

6.4

5.9

5.9

5.6

Electric, Gas & Water

3.5

4.4

4.2

3.6

3.9

Transport, Storage & Communication

6.50

7.10

7.30

7.50

7.15

Wholesale, Retail, Hotel & Restaurant

5.2

4.7

5.9

6.9

6.5

Finance, Insurance & Real Estate

6.90

9.70

3.70

4.65

4.25

Government Services

12.4

9.4

8.3

6.1

5.6

Other Services

5.1

3.9

5.1

4.8

4.5

Industry Non-Performing Loans ( MYR Million )

6,825.2

-

-

-

-

% of Industry Non-Performing Loans

23.4

-

-

-

-

* Estimate / Preliminary

** Forecast

# Based On Manufacturing Production Index



INDUSTRY ANALYSIS

 

MSIC CODE

10800 : Manufacture of prepared animal feeds

INDUSTRY :

MANUFACTURING

The manufacturing sector is expected to grow by 5.5% in 2015. It will be bolstered by strong domestic and export-oriented industries in line with growing investment activities and favorable external demand. Moreover, in 2014, the manufacturing sectors have spearheading growth. The manufacturing sector is estimated to grow at a faster pace in 2014 on higher exports of electronics and electrical (E&E) products as external demand improves.

The manufacturing sector expanded strongly during the first half of 2014, the highest growth in three years, spurred by higher global semiconductor sales. Value-added of the manufacturing sector expanded 7.1% during the first half of 2014. Production of the sector rose 6.6% in the first seven months of 2014 supported by resilient domestic demand and recovery in the external sector during the first seven months of the years. The sales value of manufactured products rebounded by 7.7% in the first seven months of 2014. The strong performance of the sector was on account of higher output at 9.4% from the domestic-oriented industries, particularly transport equipment, food and beverage.

The manufacturing sector continued to attract domestic and foreign investment with investment approved by Malaysian Investment Development Authority (MIDA) totaling RM47.4 billion during the first six months of 2014, mainly from Japan, China and Germany. Meanwhile, the capacity utilization rate remained steady at 80.4% during the second quarter of 2014 while average wage per employee and productivity improved to RM2,772 per month and 5.9%, respectively during the first seven months of 2014. Boosted by favorable domestic economic activity and recovery in the external sector, the manufacturing sector is expected to record a better performance with growth of 6.4% in 2014.

In the meantime, production of wood products rebounded by 5.1% largely supported by higher output in the saw-milling and planning of wood segment at 25.9% during the first seven months of 2014. The positive performance was attributed to vibrant residential and commercial construction activities which contributed to increased use of timber frame and glued laminated timber for cost savings compared to the use of concrete and steel. Increased demand from major export destination such as the US, Japan and Australia for Malaysian made furniture contributed to the higher output, particularly wooden and cane furniture which rebounded by 2.2%.

Production of rubber products contracted 0.3% in the first seven months of 2014 on account of slower demand for rubber gloves and rubber tyres. The decline in rubber tyres for vehicles was due to the weaker external demand from the automotive industry, particularly from China. Output of other rubber products contracted 3.8% following the product shift from rubber-based to plastics, silicones and metal alloys in the manufacture of medical devices.

Besides, exports of manufactured products are expected to grow 6.1% in 2014 boosted by the growing demand from advanced economies. However, during the first seven months of 2014, manufactured exports surged 11.4%. The robust growth was buoyed by strengthening demand in the US and EU, reflecting significant exposure of Malaysian exports to the economic performance in the advance economies. The strength in export was broad-based with robust growth in both E&E and non- E&E subsectors.

Under budget 2015, the Government will provide incentive in the form of capital allowance on automation expenditure to encourage automation in the manufacturing sector, which may help in the manufacturing sector.

OVERALL INDUSTRY OUTLOOK : Average Growth



CREDIT RISK EVALUATION & RECOMMENDATION

 


Incorporated in 2002, the Subject is a Private Limited company, focusing on manufacturing and distribution of animal feed and nutrition products. Having been in the industry for over a decade, the Subject has achieved a certain market share and has built up a satisfactory reputation in the market. It should have received supports from its regular customers. A paid up capital of MYR 1,500,002 allows the Subject to expand its business more comfortably. With a strong backing from its holding company, the Subject enjoys timely financial assistance should the needs arise.

Over the years, the Subject should have build up its clientele base and received supports from its regular customers. Investigation revealed that the Subject's interest lies mostly in the local market. Thus, any adverse changes to the local economy might have a negative impact on the Subject's business performance. Being a small company, the Subject's business operation is supported by 30 employees. Overall, we regard that the Subject's management capability is average. This indicates that the Subject has greater potential to improve its business performance and raising income for the Subject.

Due to the challenging market conditions, the Subject's business performance seems to be deteriorating and losses incurred. The Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. Due to its weak liquidity position, the Subject may face working capital deficiency in meeting its short term financial obligations if no fresh capital are injected into the Subject. The gearing level of the Subject is slightly high, therefore it faces moderate financial risk. Given a positive net worth standing at MYR 5,293,760, the Subject should be able to maintain its business in the near terms.

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.

The Subject's payment habit is average. With its adequate working capital, the Subject should be able to pay its short term debts.

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 normally.

 



PROFIT AND LOSS ACCOUNT

 

THE FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIAN FINANCIAL REPORTING STANDARDS(FRS)

OSMOSIS NUTRITION SDN. BHD.

 

Financial Year End

2013-12-31

2012-12-31

2011-12-31

2010-12-31

2009-12-31

Months

12

12

12

12

12

Consolidated Account

Company

Company

Company

Company

Company

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

18,200,934

18,643,053

19,418,632

16,938,643

15,448,023

Other Income

27,534

110,480

2,100

301,747

-

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

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

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

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

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

Total Turnover

18,228,468

18,753,533

19,420,732

17,240,390

15,448,023

Costs of Goods Sold

(17,410,835)

(17,529,916)

(17,265,719)

(13,300,228)

(11,873,322)

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

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

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

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

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

Gross Profit

817,633

1,223,617

2,155,013

3,940,162

3,574,701

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

(645,448)

41,152

957,612

2,900,864

2,752,291

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

(645,448)

41,152

957,612

2,900,864

2,752,291

Taxation

(61,091)

926,600

(246,276)

(739,924)

(695,951)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

(706,539)

967,752

711,336

2,160,940

2,056,340

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

4,500,297

3,532,545

2,821,209

2,660,269

603,929

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

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

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

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

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

As restated

4,500,297

3,532,545

2,821,209

2,660,269

603,929

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

3,793,758

4,500,297

3,532,545

4,821,209

2,660,269

DIVIDENDS - Ordinary (paid & proposed)

-

-

-

(2,000,000)

-

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

3,793,758

4,500,297

3,532,545

2,821,209

2,660,269

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Bank overdraft

10

29

16,372

11,724

11,307

Bankers' acceptance

47,560

48,328

84,216

33,827

683

Hire purchase

-

-

-

1,756

1,913

Lease interest

3,835

1,873

2,126

-

-

Term loan / Borrowing

159,212

150,986

162,978

-

24,857

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

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

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

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

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

210,617

201,216

265,692

47,307

38,760

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

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

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

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

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

DEPRECIATION (as per notes to P&L)

741,508

708,657

468,613

99,387

81,097

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

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

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

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

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

741,508

708,657

468,613

99,387

81,097

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

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

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

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

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

 

 

 

BALANCE SHEET

 

OSMOSIS NUTRITION SDN. BHD.

 

ASSETS EMPLOYED:

FIXED ASSETS

9,973,853

10,679,161

11,085,839

10,956,363

3,878,508

Deferred assets

515,000

576,000

-

-

-

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

515,000

576,000

-

-

-

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

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

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

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

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

TOTAL LONG TERM ASSETS

10,488,853

11,255,161

11,085,839

10,956,363

3,878,508

Stocks

1,775,181

2,029,656

1,939,516

1,229,736

652,995

Trade debtors

32,114

126,890

79,693

648,166

433,953

Other debtors, deposits & prepayments

144,845

40,889

47,610

74,665

255,720

Amount due from related companies

420,801

233,426

263,374

18,735

3,824,620

Cash & bank balances

207,342

165,022

7,696

337,318

109,515

Others

458

421,832

349,874

-

-

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

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

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

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

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

TOTAL CURRENT ASSETS

2,580,741

3,017,715

2,687,763

2,308,620

5,276,803

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

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

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

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

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

TOTAL ASSET

13,069,594

14,272,876

13,773,602

13,264,983

9,155,311

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

1,064,203

562,644

1,062,954

1,872,500

1,035,375

Other creditors & accruals

352,936

737,044

645,478

1,172,080

24,650

Hire purchase & lease creditors

26,018

22,820

8,179

7,642

20,336

Bank overdraft

-

-

165,775

992,071

826,896

Short term borrowings/Term loans

-

-

502,617

1,297,367

-

Other borrowings

2,013,167

1,308,859

-

-

-

Bill & acceptances payable

-

-

2,201,000

-

-

Amounts owing to holding company

-

-

-

306,919

868,919

Amounts owing to related companies

1,328,080

2,778,176

458,140

35,534

-

Provision for taxation

-

-

-

147,195

152,190

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

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

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

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

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

TOTAL CURRENT LIABILITIES

4,784,404

5,409,543

5,044,143

5,831,308

2,928,366

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

(2,203,663)

(2,391,828)

(2,356,380)

(3,522,688)

2,348,437

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

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

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

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

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

TOTAL NET ASSETS

8,285,190

8,863,333

8,729,459

7,433,675

6,226,945

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

1,500,002

1,500,002

1,500,002

1,500,002

1,500,002

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

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

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

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

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

TOTAL SHARE CAPITAL

1,500,002

1,500,002

1,500,002

1,500,002

1,500,002

Retained profit/(loss) carried forward

3,793,758

4,500,297

3,532,545

2,821,209

2,660,269

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

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

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

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

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

TOTAL RESERVES

3,793,758

4,500,297

3,532,545

2,821,209

2,660,269

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

5,293,760

6,000,299

5,032,547

4,321,211

4,160,271

Long term loans

-

-

3,324,343

3,050,316

2,035,598

Other long term borrowings

2,971,076

2,815,137

-

-

-

Lease obligations

20,354

47,897

21,969

-

-

Hire purchase creditors

-

-

-

30,148

-

Deferred taxation

-

-

350,600

32,000

31,076

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

2,991,430

2,863,034

3,696,912

3,112,464

2,066,674

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

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

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

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

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

8,285,190

8,863,333

8,729,459

7,433,675

6,226,945

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

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

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

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

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

 

 

 

FINANCIAL RATIO

 

OSMOSIS NUTRITION SDN. BHD.

 

TYPES OF FUNDS

Cash

207,342

165,022

7,696

337,318

109,515

Net Liquid Funds

207,342

165,022

(2,359,079)

(654,753)

(717,381)

Net Liquid Assets

(3,978,844)

(4,421,484)

(4,295,896)

(4,752,424)

1,695,442

Net Current Assets/(Liabilities)

(2,203,663)

(2,391,828)

(2,356,380)

(3,522,688)

2,348,437

Net Tangible Assets

8,285,190

8,863,333

8,729,459

7,433,675

6,226,945

Net Monetary Assets

(6,970,274)

(7,284,518)

(7,992,808)

(7,864,888)

(371,232)

PROFIT & LOSS ITEMS

Earnings Before Interest & Tax (EBIT)

(434,831)

242,368

1,223,304

2,948,171

2,791,051

Earnings Before Interest, Taxes, Depreciation And Amortization (EBITDA)

306,677

951,025

1,691,917

3,047,558

2,872,148

BALANCE SHEET ITEMS

Total Borrowings

5,030,615

4,194,713

6,223,883

5,377,544

2,882,830

Total Liabilities

7,775,834

8,272,577

8,741,055

8,943,772

4,995,040

Total Assets

13,069,594

14,272,876

13,773,602

13,264,983

9,155,311

Net Assets

8,285,190

8,863,333

8,729,459

7,433,675

6,226,945

Net Assets Backing

5,293,760

6,000,299

5,032,547

4,321,211

4,160,271

Shareholders' Funds

5,293,760

6,000,299

5,032,547

4,321,211

4,160,271

Total Share Capital

1,500,002

1,500,002

1,500,002

1,500,002

1,500,002

Total Reserves

3,793,758

4,500,297

3,532,545

2,821,209

2,660,269

LIQUIDITY (Times)

Cash Ratio

0.04

0.03

0

0.06

0.04

Liquid Ratio

0.17

0.18

0.15

0.19

1.58

Current Ratio

0.54

0.56

0.53

0.40

1.80

WORKING CAPITAL CONTROL (Days)

Stock Ratio

36

40

36

26

15

Debtors Ratio

1

2

1

14

10

Creditors Ratio

22

12

22

51

32

SOLVENCY RATIOS (Times)

Gearing Ratio

0.95

0.70

1.24

1.24

0.69

Liabilities Ratio

1.47

1.38

1.74

2.07

1.20

Times Interest Earned Ratio

(2.06)

1.20

4.60

62.32

72.01

Assets Backing Ratio

5.52

5.91

5.82

4.96

4.15

PERFORMANCE RATIO (%)

Operating Profit Margin

(3.55)

0.22

4.93

17.13

17.82

Net Profit Margin

(3.88)

5.19

3.66

12.76

13.31

Return On Net Assets

(5.25)

2.73

14.01

39.66

44.82

Return On Capital Employed

(5.23)

2.73

13.74

34.96

39.45

Return On Shareholders' Funds/Equity

(13.35)

16.13

14.13

50.01

49.43

Dividend Pay Out Ratio (Times)

0

0

0

0.93

0

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

0

0

 


 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.63.96

UK Pound

1

Rs.99.93

Euro

1

Rs.70.16

 

 

 

 

 

INFORMATION DETAILS

 

Analysis Done by :

RAS

 

 

Report Prepared by :

NIT

 

 

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.