MIRA INFORM REPORT

Report No. :	355426
Report Date :	21.12.2015

IDENTIFICATION DETAILS

Name :	ULTRAJET ENGINEERING SDN. BHD.
Registered Office :	E-7-1, Megan Avenue 1, 189, Jalan Tun Razak, 50400 Kuala Lumpur, Wilayah Persekutuan
Country :	Malaysia
Financials (as on) :	31.12.2014
Date of Incorporation :	13.10.2005
Com. Reg. No.:	712620-D
Legal Form :	Private Limited
Line of Business :	Subject is engaged in the Assembly of Printers.
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

Ca

RATING		STATUS	PROPOSED CREDIT LINE
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

Status :	Moderate
Payment Behaviour :	Slow
Litigation :	--

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. Malaysia is vulnerable to a fall in world commodity prices or a general slowdown in global economic activity.

The NAJIB administration 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. Gross exports of goods and services constitute more than 80% of GDP. The oil and gas sector supplied about 29% of government revenue in 2014. 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 trying to lessen its dependence on state oil producer Petronas.

Bank Negara Malaysia (the central bank) maintains healthy foreign exchange reserves; a well-developed regulatory regime has limited Malaysia's exposure to riskier financial instruments and the global financial crisis. In order to attract increased investment, NAJIB 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.

:

712620-D

COMPANY NAME

:

ULTRAJET ENGINEERING SDN. BHD.

FORMER NAME

:

PACIFIC PRINT MACH SDN. BHD. (26/06/2013)

INCORPORATION DATE

:

13/10/2005

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

E-7-1, MEGAN AVENUE 1, 189, JALAN TUN RAZAK, 50400 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

NO 3, JALAN INDAH GEMILANG 6 TAMAN PERINDUSTRIAN GEMIRLANG, 81800 ULU TIRAM, JOHOR, MALAYSIA.

TEL.NO.

:

07-8618610

FAX.NO.

:

07-8618612

CONTACT PERSON

:

LIM BOON CHE ( MANAGING DIRECTOR )

INDUSTRY CODE

:

28

PRINCIPAL ACTIVITY

:

ASSEMBLY OF PRINTERS

AUTHORISED CAPITAL

:

MYR 2,500,000.00 DIVIDED INTO 
ORDINARY SHARE 2,500,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 1,000,000.00 DIVIDED INTO 
ORDINARY SHARES 1,000,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 410 [2014]

NET WORTH

:

MYR 315,990 [2014]

STAFF STRENGTH

:

N/A

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

POOR

PAYMENT

:

POOR

MANAGEMENT CAPABILITY

:

AVERAGE

COMMERCIAL RISK

:

N/A

CURRENCY EXPOSURE

:

N/A

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) assembly of printers.

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

Former Address(es)

Address	As At Date
B-10-4, BLOCK B, MEGAN AVENUE 1, 189, JALAN TUN RAZAK, 50400, WILAYAH PERSEKUTUAN, MALAYSIA	18/12/2015

Share Capital History

Date	Authorised Shared Capital	Issue & Paid Up Capital
30/06/2015	MYR 2,500,000.00	MYR 1,000,000.00
11/10/2013	MYR 2,500,000.00	MYR 100,000.00
15/02/2013	MYR 100,000.00	MYR 100,000.00

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

Current Shareholder(s) :

Name	Address	IC/PP/Loc No	Shareholding	(%)
MR. LIM BOON CHE +	9, JALAN PESONA 15, TAMAN PELANGI INDAH, 81800 ULU TIRAM, JOHOR, MALAYSIA.	640709-01-5329 7313196	342,300.00	34.23
MR. LEE POH GUAN +	16, JALAN LAWA 7, TAMAN PELANGI INDAH, 81800 ULU TIRAM, JOHOR, MALAYSIA.	690912-01-6541 A1380275	342,300.00	34.23
DELMARCO SDN. BHD.	23-01/02, JALAN MOLEK 1/9, TAMAN MOLEK, 81100 JOHOR BAHRU, JOHOR, MALAYSIA.	296116D	293,400.00	29.34
MR. LIM BOON EYU +	12, JALAN ADDA 5/8, TAMAN ADDA, 81100 JOHOR BAHRU, JOHOR, MALAYSIA.	711117-01-5697 A2010482	10,000.00	1.00
MR. WONG ZHEN HUI +	15, JALAN E/J 6/8, TAMAN EHSAN JAYA, 81100 JOHOR BAHRU, JOHOR, MALAYSIA.	820917-01-5735	4,000.00	0.40
MR. SANI BIN SIDIK +	29, JALAN SS7, TAMAN SRI SAUJANA, 81900 KOTA TINGGI, JOHOR, MALAYSIA.	770827-01-6467 A3770262	4,000.00	0.40
MR. YONG HANN SIN	BAN HO TONG ESTATE, KEMENDOR, 77000 JASIN, MELAKA, MALAYSIA.	790325-04-5223	4,000.00	0.40
			---------------	------
			1,000,000.00	100.00
			============	=====

+ Also Director

Former Shareholder(s) :

Name	Country	IC/PP/Loc No	Shareholding	Last Updated
ATEX DIGITAL PTE. LTD.	N/A	XLZ200205212K	N/A	13/06/2007
CHAN JEE NEE (JENNY)	MALAYSIA	651104-01-5258	51,000.00	25/08/2014
GGS SYSTEMS (M) SDN. BHD.	MALAYSIA	358514K	N/A	29/08/2008
LAW PHOOI YEN	MALAYSIA	670329-08-5250	N/A	N/A
LIM KONG HON	MALAYSIA	721006-08-5851	N/A	N/A
TAN LAY CHU	MALAYSIA	710301-01-5166	N/A	N/A

DIRECTORS

DIRECTOR 1

Name Of Subject	:	MR. SANI BIN SIDIK
Address	:	29, JALAN SS7, TAMAN SRI SAUJANA, 81900 KOTA TINGGI, JOHOR, MALAYSIA.
Other Address(es)	:	FELCRA SEKIJANG / FELCRA GUGUSAN SEKIJANG, SEKIJANG, KEMELAH, SEKIJANG, MALAYSIA.
IC / PP No	:	A3770262
New IC No	:	770827-01-6467
Date of Birth	:	27/08/1977
Nationality	:	MALAYSIAN
Date of Appointment	:	31/01/2015

DIRECTOR 2

Name Of Subject	:	MR. WONG ZHEN HUI
Address	:	15, JALAN E/J 6/8, TAMAN EHSAN JAYA, 81100 JOHOR BAHRU, JOHOR, MALAYSIA.
Other Address(es)	:	TMN BERJAYA, KAMPONG BAHRU BEKOK TENGAH, BEKOK, 81100 JOHOR BAHRU, JOHOR, MALAYSIA.
New IC No	:	820917-01-5735
Date of Birth	:	17/09/1982
Nationality	:	MALAYSIAN
Date of Appointment	:	31/01/2015

DIRECTOR 3

Name Of Subject	:	MR. LIM BOON EYU
Address	:	12, JALAN ADDA 5/8, TAMAN ADDA, 81100 JOHOR BAHRU, JOHOR, MALAYSIA.
IC / PP No	:	A2010482
New IC No	:	711117-01-5697
Date of Birth	:	17/11/1971
Nationality	:	MALAYSIAN
Date of Appointment	:	31/01/2015

DIRECTOR 4

Name Of Subject	:	MR. LIM BOON CHE
Address	:	9, JALAN PESONA 15, TAMAN PELANGI INDAH, 81800 ULU TIRAM, JOHOR, MALAYSIA.
Other Address(es)	:	18 JALAN RUMBIA 37, TAMAN DAYA, 81100 JOHOR BHARU;JOHOR, MALAYSIA.
IC / PP No	:	7313196
New IC No	:	640709-01-5329
Date of Birth	:	09/07/1964
Nationality	:	MALAYSIAN
Date of Appointment	:	08/07/2013

DIRECTOR 5

Name Of Subject	:	MR. LEE POH GUAN
Address	:	16, JALAN LAWA 7, TAMAN PELANGI INDAH, 81800 ULU TIRAM, JOHOR, MALAYSIA.
IC / PP No	:	A1380275
New IC No	:	690912-01-6541
Date of Birth	:	12/09/1969
Nationality	:	MALAYSIAN
Date of Appointment	:	08/07/2013

MANAGEMENT

1)	Name of Subject	:	LIM BOON CHE
	Position	:	MANAGING DIRECTOR

AUDITOR

Auditor	:	P.S.YAP, ISMA & ASSOCIATES
Auditor' Address	:	SUITE 123, JOHOR TOWER, 15, JALAN GEREJA, 1ST FLOOR, 80100 JOHOR BAHRU, JOHOR, MALAYSIA.

COMPANY SECRETARIES

1)	Company Secretary	:	MS. TAN DIN SIN
	IC / PP No	:	A0603069
	New IC No	:	670326-01-6102
	Address	:	A-12-4, VISTA KIARA CONDOMINIUM, 7, JALAN 1/61A, BUKIT KIARA, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

2)	Company Secretary	:	MS. KHAW SZE SZE
	New IC No	:	820923-01-6224
	Address	:	AU9, PRIMA COURT, JALAN UKAY PRIMA, SAUJANA MELAWATI, 53100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BANKING

Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

ENCUMBRANCE (S)

Charge No	Creation Date	Charge Description	Chargee Name	Total Charge	Status
1	24/01/2014	FACILITIES AGREEMENT AND CHARGE	PUBLIC BANK BERHAD	-	Unsatisfied

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	:	N/A
Overseas	:	N/A

The Subject refused to disclose its suppliers. 

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	[	]
Fair 91-120 Days	[	]	Poor >120 Days	[	X	]

CLIENTELE

Local	:	N/A
Overseas	:	N/A

The Subject refused to disclose its clientele. 

OPERATIONS

Products manufactured

:

PRINTERS

Branch

:

NO

Other Information:

The Subject is principally engaged in the (as a / as an) assembly of printers. 

The Subject deals with Industrial high speed textile digital printer textile inkjet engraver bluray engraver and others. 

CURRENT INVESTIGATION

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client	:	60 7 8618610
Current Telephone Number	:	07-8618610
Match	:	YES
Address Provided by Client	:	NO 3, JALAN INDAH GEMILANG 6 TAMAN PERINDUSTRIAN GEMIRLANG, 81800ULU TIRAM JOHOR
Current Address	:	NO 3, JALAN INDAH GEMILANG 6 TAMAN PERINDUSTRIAN GEMIRLANG, 81800 ULU TIRAM, JOHOR, MALAYSIA.
Match	:	YES
Latest Financial Accounts	:	YES

Other Investigations

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

The Subject refused to disclose its number of employees.

FINANCIAL ANALYSIS

Profitability
Turnover	:	Increased	[	3.80%	]
Profit/(Loss) Before Tax	:	Increased	[	(855.45%)	]
Return on Shareholder Funds	:	Unfavourable	[	(191.88%)	]
Return on Net Assets	:	Unfavourable	[	(9.40%)	]
The higher turnover could be attributed to the favourable market condition.Higher losses before tax during the year could be due to the higher operating costs incurred. 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	:	Unfavourable	[	147897 Days	]
Debtor Ratio	:	Favourable	[	0 Days	]
Creditors Ratio	:	Unfavourable	[	102910 Days	]
The Subject could be incurring higher holding cost. As its capital was tied up in stocks, it could face liquidity problems. The favourable debtors' days could be due to the good credit control measures implemented by the Subject. The unfavourable creditors' ratio could be due to the Subject taking advantage of the credit granted by its suppliers. However this may affect the goodwill between the Subject and its suppliers and the Subject may inadvertently have to pay more for its future supplies.
Liquidity
Liquid Ratio	:	Unfavourable	[	0.24 Times	]
Current Ratio	:	Unfavourable	[	0.29 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	[	(2.44 Times)	]
Gearing Ratio	:	Unfavourable	[	14.77 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 was highly geared, thus it had a high financial risk. The Subject was dependent on loans to finance its business needs. In times of economic downturn and / or high interest rate, the Subject will become less profitable and competitive than other firms in the same industry, which are lowly geared. This is because the Subject has to service the interest and to repay the loan, which will erode part of its profits. The profits will fluctuate depending on the Subject's turnover and the interest it needs to pay.
Overall Assessment :
Although the Subject's turnover increased its profits however showed a reverse trend. The losses could be due to the management's failure to maintain its competitiveness in the market. 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 level was high and its going concern will be in doubt if there is no injection of additional shareholders' funds in times of economic downturn and / or high interest rates.
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	30.0	30.5
Gross Domestic Products ( % )	5.1	5.6	5.3	6.0	4.7
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	82,480	85,258
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	3.2
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	49,203	-
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	44.0	44.2
Tourist Arrival ( Million Persons )	24.7	25.0	25.7	27.4	29.4
Hotel Occupancy Rate ( % )	60.6	62.4	62.6	63.6	58.8
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)	1.0	0.7	0.7	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	5.3
Electrical & Electronics	(4.0)	12.7	6.9	13.3	7.9
Rubber Products	20.7	3.0	11.7	(0.3)	3.4
Wood Products	(5.1)	8.7	(2.7)	5.1	7.1
Textiles & Apparel	13.2	(7.1)	(2.6)	11.5	7.2
Domestic-oriented Industries	10.7	1.7	6.8	9.4	3.3
Food, Beverages & Tobacco	4.80	2.70	3.60	6.13	8.90
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	3.6
Non-metallic Mineral	12.1	2.9	(2.0)	5.4	7.2
Transport Equipment	12.0	3.4	13.8	22.9	7.6
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
28 : MANUFACTURE OF MACHINERY AND EQUIPMENT N.E.C
INDUSTRY :	MACHINERY
Malaysia is presently the leading manufacturer of automation machinery and equipment (M&E) in the ASEAN region with a total of 22 companies in production. The machinery and equipment industry has expanded and produce a diverse range of machinery which give importance to the overall industrial development of the country, due to its cross cutting linkages with all industrial sectors.
Growth of the domestic-oriented industries such as machinery and transportation equipment is expected to remain favourable in 2014, in line with resilient domestic consumption and robust private investment. However, the output of general-purpose machinery decreased 8.8% in the first seven moths of 2014 (January - July 2013: -1.8%) due to the decline in manufacture of air-conditioning machine (-17.9%) as well as lifting and handling equipment (-8.2%).
Besides, shipments of machinery, appliances and parts continued to expand rapidly by 12.5% in the first seven months of 2014 (January - July 2013: 1.4%) with stronger demand from Singapore, the US, China and Australia. Growth was mainly contributed by specialized machinery for specific industries (16.3%), particularly for civil engineering and manufacture of semiconductors as well as general industrial machinery and equipment (9.2%) such as heating and cooling equipment and parts as well as mechanical handling equipment and parts.
According to the World Bank's Doing Business 2014 Report, Malaysia improved to 15th from 25th position in the 2014 Foreign Direct Investment Confidence Index, with highlighted Malaysia's efforts in building its competitive position in electronics, automotive, and machinery manufacturing to move up the value chain into high technology and skill-intensive segments.
The Government has identified the M&E industry to be one of the key areas for growth and development. The growth will focus on the manufacture of high value-added and high technology M&E. For the further development of the M&E industry, six strategic thrusts have been set during the Third Industrial Master Plan (IMP3), 2006 - 2020 period:-
- Promoting Malaysia as a regional production, trading and distribution centre for M&E
- Rising the development and promotion of selected specialized and high technology M&E
- Strengthening the engineering support industries and support services
- Developing Malaysian Standards for machinery and equipment
- Developing sufficient highly skilled workforce
- Strengthening the institutional support for the further development of the industry
OVERALL INDUSTRY OUTLOOK : Average Growth

CREDIT RISK EVALUATION & RECOMMENDATION

Incorporated in 2005, the Subject is a Private Limited company, focusing on assembly of printers. 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 1,000,000 allows the Subject to expand its business more comfortably. However, the Subject does not have strong shareholders’ backing. Without a strong shareholders' backing, the opportunity of the Subject to expand its business is limited. 

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. 

Despite the higher turnover, the Subject suffered pre-tax losses which reflected a highly competitive business environment. 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 high gearing ratio clearly implied that the Subject was supported by more debt than equity. Thus, the Subject is exposed to high financial risk. 

The poor payment habit may affect the goodwill between the Subject and its suppliers and the Subject may inadvertently have to pay more for its future supplies. 

The industry shows an upward trend and this trend is very likely to sustain in the near terms. 

In view of the above, we only recommend credit be proceeded to the Subject with guarantee.

PROFIT AND LOSS ACCOUNT

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

ULTRAJET ENGINEERING SDN. BHD.

Financial Year End	2014-12-31	2013-12-31	2012-12-31	2011-12-31	2010-12-31
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	SUMMARY	SUMMARY	SUMMARY
Currency	MYR	MYR	MYR	MYR	MYR
TURNOVER	410	395	-	-	-
	----------------	----------------	----------------	----------------	----------------
Total Turnover	410	395	-	-	-
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) FROM OPERATIONS	(606,326)	(63,460)	(958)	(1,793)	(1,648)
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) BEFORE TAXATION	(606,326)	(63,460)	(958)	(1,793)	(1,648)
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) AFTER TAXATION	(606,326)	(63,460)	(958)	(1,793)	(1,648)
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) BROUGHT FORWARD
As previously reported	(77,684)	(14,224)	(13,266)	(11,473)	(9,825)
	----------------	----------------	----------------	----------------	----------------
As restated	(77,684)	(14,224)	(13,266)	(11,473)	(9,825)
	----------------	----------------	----------------	----------------	----------------
PROFIT AVAILABLE FOR APPROPRIATIONS	(684,010)	(77,684)	(14,224)	(13,266)	(11,473)
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) CARRIED FORWARD	(684,010)	(77,684)	(14,224)	(13,266)	(11,473)
	=============	=============	=============	=============	=============
INTEREST EXPENSE (as per notes to P&L)
Term loan / Borrowing	176,373	-	-	-	-
	----------------	----------------	----------------	----------------	----------------
	176,373	-	-	-	-
	=============	-	-	-	-
DEPRECIATION (as per notes to P&L)	119,098	-	-	-	-
	----------------	----------------	----------------	----------------	----------------
	119,098	-	-	-	-
	=============

BALANCE SHEET

ULTRAJET ENGINEERING SDN. BHD.

ASSETS EMPLOYED:
FIXED ASSETS	7,082,432	-	-	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM ASSETS	7,082,432	-	-	-	-
Stocks	166,131	-	-	-	-
Other debtors, deposits & prepayments	122,997	670,000	-	-	-
Amount due from related companies	534,102	294,455	-	-	-
Cash & bank balances	184,356	11,795	-	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT ASSETS	1,007,586	976,250	86,903	89,021	89,838
	----------------	----------------	----------------	----------------	----------------
TOTAL ASSET	8,090,018	976,250	86,903	89,021	89,838
	=============	=============	=============	=============	=============
CURRENT LIABILITIES
Trade creditors	115,597	-	-	-	-
Other creditors & accruals	22,437	53,934	-	-	-
Short term borrowings/Term loans	409,034	-	-	-	-
Amounts owing to related companies	2,970,247	-	-	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT LIABILITIES	3,517,315	53,934	1,127	2,287	1,311
	----------------	----------------	----------------	----------------	----------------
NET CURRENT ASSETS/(LIABILITIES)	(2,509,729)	922,316	85,776	86,734	88,527
	----------------	----------------	----------------	----------------	----------------
TOTAL NET ASSETS	4,572,703	922,316	85,776	86,734	88,527
	=============	=============	=============	=============	=============
SHARE CAPITAL
Ordinary share capital	1,000,000	1,000,000	100,000	100,000	100,000
	----------------	----------------	----------------	----------------	----------------
TOTAL SHARE CAPITAL	1,000,000	1,000,000	100,000	100,000	100,000
Retained profit/(loss) carried forward	(684,010)	(77,684)	(14,224)	(13,266)	(11,473)
	----------------	----------------	----------------	----------------	----------------
TOTAL RESERVES	(684,010)	(77,684)	(14,224)	(13,266)	(11,473)
	----------------	----------------	----------------	----------------	----------------
SHAREHOLDERS' FUNDS/EQUITY	315,990	922,316	85,776	86,734	88,527
Long term loans	4,256,713	-	-	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM LIABILITIES	4,256,713	-	-	-	-
	----------------	----------------	----------------	----------------	----------------
	4,572,703	922,316	85,776	86,734	88,527
	=============	=============	=============	=============	=============

FINANCIAL RATIO

ULTRAJET ENGINEERING SDN. BHD.

TYPES OF FUNDS
Cash	184,356	11,795	-	-	-
Net Liquid Funds	184,356	11,795	-	-	-
Net Liquid Assets	(2,675,860)	922,316	85,776	86,734	88,527
Net Current Assets/(Liabilities)	(2,509,729)	922,316	85,776	86,734	88,527
Net Tangible Assets	4,572,703	922,316	85,776	86,734	88,527
Net Monetary Assets	(6,932,573)	922,316	85,776	86,734	88,527
PROFIT & LOSS ITEMS
Earnings Before Interest & Tax (EBIT)	(429,953)	(63,460)	-	-	-
Earnings Before Interest, Taxes, Depreciation And Amortization (EBITDA)	(310,855)	(63,460)	-	-	-
BALANCE SHEET ITEMS
Total Borrowings	4,665,747	-	-	-	-
Total Liabilities	7,774,028	53,934	1,127	2,287	1,311
Total Assets	8,090,018	976,250	86,903	89,021	89,838
Net Assets	4,572,703	922,316	85,776	86,734	88,527
Net Assets Backing	315,990	922,316	85,776	86,734	88,527
Shareholders' Funds	315,990	922,316	85,776	86,734	88,527
Total Share Capital	1,000,000	1,000,000	100,000	100,000	100,000
Total Reserves	(684,010)	(77,684)	(14,224)	(13,266)	(11,473)
LIQUIDITY (Times)
Cash Ratio	0.05	0.22	-	-	-
Liquid Ratio	0.24	18.10	-	-	-
Current Ratio	0.29	18.10	77.11	38.92	68.53
WORKING CAPITAL CONTROL (Days)
Stock Ratio	147,897	-	-	-	-
Creditors Ratio	102,910	-	-	-	-
SOLVENCY RATIOS (Times)
Gearing Ratio	14.77	-	-	-	-
Liabilities Ratio	24.60	0.06	0.01	0.03	0.01
Times Interest Earned Ratio	(2.44)	-	-	-	-
Assets Backing Ratio	4.57	0.92	0.86	0.87	0.89
PERFORMANCE RATIO (%)
Operating Profit Margin	(147,884.39)	(16,065.82)	-	-	-
Net Profit Margin	(147,884.39)	(16,065.82)	-	-	-
Return On Net Assets	(9.40)	(6.88)	(1.12)	(2.07)	(1.86)
Return On Capital Employed	(9.40)	(6.88)	(1.12)	(2.07)	(1.86)
Return On Shareholders' Funds/Equity	(191.88)	(6.88)	(1.12)	(2.07)	(1.86)

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.66.42
UK Pound	1	Rs.99.17
Euro	1	Rs.72.14
MYR	1	Rs.15.44

Note : Above are approximate rates obtained from sources believed to be correct

INFORMATION DETAILS

Analysis Done by :	AMR
Report Prepared by :	TPT

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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