MIRA INFORM REPORT

 

 

Report No. :

357366

Report Date :

29.12.2015

 

IDENTIFICATION DETAILS

 

Name :

POREX TECHNOLOGIES SDN. BHD.

 

 

Formerly Known as :

POREX PRODUCTS MALAYSIA SDN BHD

 

 

Registered Office :

Menara Tokio Marine Life, 189 Jalan Tun Razak, Level 16, 50400 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2014

 

 

Date of Incorporation :

02.08.2000

 

 

Com. Reg. No.:

522541-U

 

 

Legal Form :

Private Limited (Limited By Share)

 

 

Line of Business :

Manufacturer, distributor of porous plastic components.

 

 

No. of Employee :

100 [2015]

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Status :

Good

 

 

Payment Behaviour :

Regular

 

 

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. 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.

:

522541-U

COMPANY NAME

:

POREX TECHNOLOGIES SDN. BHD.

FORMER NAME

:

POREX PRODUCTS MALAYSIA SDN BHD (25/04/2005)

INCORPORATION DATE

:

02/08/2000

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED (LIMITED BY SHARE)

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

MENARA TOKIO MARINE LIFE, 189 JALAN TUN RAZAK, LEVEL 16, 50400 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

LOT PT 74, JALAN HULU TINGGI 26/6, SEKSYEN 26, SEKSYEN A, HICOM INDUSTRIAL PARK, 40400 SHAH ALAM, SELANGOR, MALAYSIA.

TEL.NO.

:

03-51913308

FAX.NO.

:

03-51923308

CONTACT PERSON

:

CHEH KAH MUN ( MANAGING DIRECTOR )

INDUSTRY CODE

:

222

PRINCIPAL ACTIVITY

:

MANUFACTURER, DISTRIBUTOR OF POROUS PLASTIC COMPONENTS

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 2,800,000.00 DIVIDED INTO
ORDINARY SHARES 2,800,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 51,808,196 [2014]

NET WORTH

:

MYR 26,894,124 [2014]

STAFF STRENGTH

:

100 [2015]

BANKER (S)

:

UNITED OVERSEAS BANK (MALAYSIA) BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

STRONG

PAYMENT

:

REGULAR

MANAGEMENT CAPABILITY

:

AVERAGE

COMMERCIAL RISK

:

LOW

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) manufacturer, distributor of porous plastic components.

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

 

The immediate holding company of the Subject is POREX CORPORATION, a company incorporated in UNITED STATES.

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

29/04/2015

MYR 5,000,000.00

MYR 2,800,000.00

02/08/2000

MYR 100,000.00

MYR 2.00

 

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


Current Shareholder(s) :

Name

Address

IC/PP/Loc No

Shareholding

(%)

POREX CORPORATION

500, BOHANNON ROAD, FAIRBURN GA 30213

XLZ000017869

2,800,000.00

100.00

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

------

2,800,000.00

100.00

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

=====

+ Also Director



DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

WILLIAM GRAHAM MIDGETTE

Address

:

1320, WILMINGTON WAY, GRAYSON, GA, 30017, UNITED STATES.

IC / PP No

:

Z7523014

Nationality

:

AMERICAN

Date of Appointment

:

09/12/2005

 

DIRECTOR 2

 

Name Of Subject

:

MR. CHEH KAH MUN

Address

:

78, JALAN SS 22A/3, DAMANSARA JAYA, 47420 PETALING JAYA, SELANGOR, MALAYSIA.

IC / PP No

:

A0178659

New IC No

:

650626-08-5275

Date of Birth

:

26/06/1965

Nationality

:

MALAYSIAN

Date of Appointment

:

14/02/2011

 

DIRECTOR 3

 

Name Of Subject

:

MR. CHAN HUAN SHEN

Address

:

C-2-12, PANGSAPURI PELANGI HEIGHT, JALAN PELANGI, 41300 KLANG, SELANGOR, MALAYSIA.

New IC No

:

790905-08-5969

Date of Birth

:

05/09/1979

Nationality

:

MALAYSIAN

Date of Appointment

:

19/11/2012


MANAGEMENT

 

 

 

1)

Name of Subject

:

CHEH KAH MUN

Position

:

MANAGING DIRECTOR

 

 

 

AUDITOR

 

Auditor

:

DELOITTE

Auditor' Address

:

MENARA LGB, 1 JALAN WAN KADIR, TAMAN TUN DR. ISMAIL, LEVEL 16, 60000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. OOI BEE HONG

IC / PP No

:

6796401

New IC No

:

620128-07-5560

Address

:

123A, JALAN CEMPAKA HUTAN, SIERRAMAS, 47000 SUNGAI BULOH, SELANGOR, MALAYSIA.

 

2)

Company Secretary

:

MS. LEW KEN LEE

IC / PP No

:

A1768204

New IC No

:

710227-06-5172

Address

:

30, JALAN PUJ 2/19, TAMAN PUNCAK JALIL, BANDAR PUTRA PERMAI, 43300 SERI KEMBANGAN, SELANGOR, MALAYSIA.

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

UNITED OVERSEAS BANK (MALAYSIA) BHD

 

2)

Name

:

 

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

22/08/2003

N/A

UNITED OVERSEAS BANK MALAYSIA BHD

MYR 1.00

Satisfied

2

01/08/2006

MEMORANDUM OF LEGAL CHARGE OVER DEPOSITS

UNITED OVERSEAS BANK (MALAYSIA) BHD.

-

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

:

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

[

X

]

Good 31-60 Days

[

]

Average 61-90 Days

[

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Export Market

:

ASIA

Credit Term

:

30 DAYS

Payment Mode

:

CHEQUES
TELEGRAPHIC TRANSFER (TT)

 

 

OPERATIONS

 

Products manufactured

:

POROUS PLASTIC COMPONENTS

Shifts

:

2 SHIFT

 

Total Number of Employees:

YEAR

2015

2014

GROUP

N/A

N/A

COMPANY

100

100

 

Branch

:

NO

 

Other Information:


The Subject is principally engaged in the (as a / as an) manufacturer, distributor of porous plastic components.

The Subject produces porous media solutions for filtration, wicking, venting, diffusion, and media support applications.

 

CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

03-51913308

Match

:

N/A

Address Provided by Client

:

LOT P .T.74, JALAN HULU TINGGI 26/6 SEKSYEN 26, SEKOR A, HICOM IND PARK404000 SHAH ALAM SELANGOR D.E MALAYSIA

Current Address

:

LOT PT 74, JALAN HULU TINGGI 26/6, SEKSYEN 26, SEKSYEN A, HICOM INDUSTRIAL PARK, 40400 SHAH ALAM, SELANGOR, 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 is as per stated in the report.


FINANCIAL ANALYSIS

 

 

Profitability

Turnover

:

Increased

[

2010 - 2014

]

Profit/(Loss) Before Tax

:

Increased

[

2010 - 2014

]

Return on Shareholder Funds

:

Favourable

[

33.04%

]

Return on Net Assets

:

Favourable

[

43.67%

]

The Subject's turnover increased steadily as the demand for its products / services increased due to the goodwill built up over the years.The Subject's management have been efficient in controlling its operating costs. Generally the Subject was profitable. The favourable return on shareholders' funds and return on net assets indicate that the Subject's management was efficient in utilising the assets to generate returns.

Working Capital Control

Stock Ratio

:

Unfavourable

[

73 Days

]

Debtor Ratio

:

Favourable

[

39 Days

]

Creditors Ratio

:

Favourable

[

18 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 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

:

Favourable

[

3.33 Times

]

Current Ratio

:

Favourable

[

5.50 Times

]

A minimum liquid ratio of 1 should be maintained by the Subject in order to assure its creditors of its ability to meet short term obligations and the Subject was in a good liquidity position. Thus, we believe the Subject is able to meet all its short term obligations as and when they fall due.

Solvency

Interest Cover

:

Nil

[

0.00 Times

]

Gearing Ratio

:

Favourable

[

0.00 Times

]

The Subject's interest cover was nil as it did not pay any interest during the year. The Subject had no gearing and hence it had virtually no financial risk. The Subject was financed by its shareholders' funds and internally generated fund. During the economic downturn, the Subject, having a zero gearing, will be able to compete better than those which are highly geared in the same industry.

Overall Assessment :

Generally, the Subject's performance has improved with higher turnover and profit. The Subject was in good liquidity position with its total current liabilities well covered by its total current assets. With its current net assets, the Subject should be able to repay its short term obligations. The Subject did not make any interest payment during the year. The Subject was dependent on its shareholders' funds to finance its business needs. The Subject was a zero gearing company, it was solely dependant on its shareholders to provide funds to finance its business. The Subject has good chance of getting loans, if the needs arises.

Overall financial condition of the Subject : STRONG

 

 

 

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

 

222 : Manufacture of plastic products

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 2000, the Subject is a Private Limited company, focusing on manufacturer, distributor of porous plastic components. With its long establishment in the market, the Subject has received strong support from its stable customers base. Its business position in the market is quite stable and it is expected to enjoy better market shares over its rivals. A paid up capital of MYR 2,800,000 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 has penetrated into both the local and overseas market. The Subject has positioned itself in the global market and is competing in the industry. Its stable clientele base will enable the Subject to further enhance its business in the near term. Being a moderate size company, the Subject has a total workforce of 100 employees in its business operations. 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.

We noted that both the turnover and profits have increased compared to the previous year. The higher profit could be due to increase in turnover and better control over its operating costs. Based on the higher profitability, the Subject has generated a favourable return based on its existing shareholders' funds which indicated that the management was efficient in utilising its funds to generate income. The Subject is in good liquidity position with its current liabilities well covered by it current assets. Hence, it has sufficient working capital to meet its short term financial obligations. Being a zero geared company, the Subject virtually has no financial risk as it is mainly dependent on its internal funds to finance its business. Given a positive net worth standing at MYR 26,894,124, 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.

We regard that the Subject's overall payment habit is prompt. The Subject had a favourable creditors' ratio as evidenced by its favourable collection days.

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.

In view of the above favourable condition, we recommend credit be proceeded to the Subject with favourable term.

 



PROFIT AND LOSS ACCOUNT

 

 

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

 

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

FULL

SUMMARY

SUMMARY

Currency

MYR

MYR

MYR

MYR

MYR

TURNOVER

51,808,196

49,796,429

40,381,490

35,936,466

33,651,758

Other Income

-

-

23,489

-

-

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

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

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

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

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

Total Turnover

51,808,196

49,796,429

40,404,979

35,936,466

33,651,758

Costs of Goods Sold

(31,101,650)

(30,287,730)

(26,723,160)

-

-

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

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

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

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

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

Gross Profit

20,706,546

19,508,699

13,681,819

-

-

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

11,883,057

10,994,056

5,038,608

7,754,378

7,553,608

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

11,883,057

10,994,056

5,038,608

7,754,378

7,553,608

Taxation

(2,996,484)

(2,887,128)

(1,463,814)

(2,415,611)

(1,624,885)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

8,886,573

8,106,928

3,574,794

5,338,767

5,928,723

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

21,282,551

21,800,573

23,565,779

22,646,012

16,717,289

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

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

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

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

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

As restated

21,282,551

21,800,573

23,565,779

22,646,012

16,717,289

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

30,169,124

29,907,501

27,140,573

27,984,779

22,646,012

DIVIDENDS - Ordinary (paid & proposed)

(6,075,000)

(8,624,950)

(5,340,000)

(4,419,000)

-

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

24,094,124

21,282,551

21,800,573

23,565,779

22,646,012

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

DEPRECIATION (as per notes to P&L)

1,333,313

1,198,893

5,038,608

-

-

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

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

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

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

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

1,333,313

1,198,893

5,038,608

-

-

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

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

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

 

 

 

BALANCE SHEET

 

 

 

ASSETS EMPLOYED:

FIXED ASSETS

5,597,005

5,353,008

3,931,989

3,697,706

3,910,064

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

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

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

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

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

TOTAL LONG TERM ASSETS

5,597,005

5,353,008

3,931,989

3,697,706

3,910,064

Stocks

10,419,565

11,508,342

13,021,496

-

-

Trade debtors

5,482,718

5,681,792

6,298,670

-

-

Other debtors, deposits & prepayments

819,369

745,731

697,199

-

-

Short term deposits

329,187

322,664

315,139

-

-

Amount due from related companies

5,250,000

-

-

-

-

Cash & bank balances

3,463,305

5,099,537

4,690,116

-

-

Others

651,936

1,011,180

453,332

-

-

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

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

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

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

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

TOTAL CURRENT ASSETS

26,416,080

24,369,246

25,475,952

27,481,558

26,340,101

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

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

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

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

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

TOTAL ASSET

32,013,085

29,722,254

29,407,941

31,179,264

30,250,165

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

1,494,242

1,149,619

741,641

-

-

Other creditors & accruals

1,503,510

1,585,948

1,951,385

-

-

Amounts owing to holding company

244,893

1,413,792

1,763,670

-

-

Amounts owing to related companies

1,558,115

1,172,143

157,081

-

-

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

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

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

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

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

TOTAL CURRENT LIABILITIES

4,800,760

5,321,502

4,613,777

4,372,130

4,727,270

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

21,615,320

19,047,744

20,862,175

23,109,428

21,612,831

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

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

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

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

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

TOTAL NET ASSETS

27,212,325

24,400,752

24,794,164

26,807,134

25,522,895

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

2,800,000

2,800,000

2,800,000

2,800,000

2,800,000

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

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

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

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

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

TOTAL SHARE CAPITAL

2,800,000

2,800,000

2,800,000

2,800,000

2,800,000

Retained profit/(loss) carried forward

24,094,124

21,282,551

21,800,573

23,565,779

22,646,012

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

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

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

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

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

TOTAL RESERVES

24,094,124

21,282,551

21,800,573

23,565,779

22,646,012

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

26,894,124

24,082,551

24,600,573

26,365,779

25,446,012

Deferred taxation

318,201

318,201

193,591

-

-

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

318,201

318,201

193,591

441,355

76,883

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

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

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

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

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

27,212,325

24,400,752

24,794,164

26,807,134

25,522,895

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

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

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

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

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

 

 

FINANCIAL RATIO

 

 

 

TYPES OF FUNDS

Cash

3,792,492

5,422,201

5,005,255

-

-

Net Liquid Funds

3,792,492

5,422,201

5,005,255

-

-

Net Liquid Assets

11,195,755

7,539,402

7,840,679

23,109,428

21,612,831

Net Current Assets/(Liabilities)

21,615,320

19,047,744

20,862,175

23,109,428

21,612,831

Net Tangible Assets

27,212,325

24,400,752

24,794,164

26,807,134

25,522,895

Net Monetary Assets

10,877,554

7,221,201

7,647,088

22,668,073

21,535,948

PROFIT & LOSS ITEMS

Earnings Before Interest & Tax (EBIT)

11,883,057

10,994,056

5,038,608

-

-

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

13,216,370

12,192,949

10,077,216

-

-

BALANCE SHEET ITEMS

Total Borrowings

0

0

0

-

-

Total Liabilities

5,118,961

5,639,703

4,807,368

4,813,485

4,804,153

Total Assets

32,013,085

29,722,254

29,407,941

31,179,264

30,250,165

Net Assets

27,212,325

24,400,752

24,794,164

26,807,134

25,522,895

Net Assets Backing

26,894,124

24,082,551

24,600,573

26,365,779

25,446,012

Shareholders' Funds

26,894,124

24,082,551

24,600,573

26,365,779

25,446,012

Total Share Capital

2,800,000

2,800,000

2,800,000

2,800,000

2,800,000

Total Reserves

24,094,124

21,282,551

21,800,573

23,565,779

22,646,012

LIQUIDITY (Times)

Cash Ratio

0.79

1.02

1.08

-

-

Liquid Ratio

3.33

2.42

2.70

-

-

Current Ratio

5.50

4.58

5.52

6.29

5.57

WORKING CAPITAL CONTROL (Days)

Stock Ratio

73

84

118

-

-

Debtors Ratio

39

42

57

-

-

Creditors Ratio

18

14

10

-

-

SOLVENCY RATIOS (Times)

Gearing Ratio

0

0

0

-

-

Liabilities Ratio

0.19

0.23

0.20

0.18

0.19

Times Interest Earned Ratio

0

0

0

-

-

Assets Backing Ratio

9.72

8.71

8.86

9.57

9.12

PERFORMANCE RATIO (%)

Operating Profit Margin

22.94

22.08

12.48

21.58

22.45

Net Profit Margin

17.15

16.28

8.85

14.86

17.62

Return On Net Assets

43.67

45.06

20.32

28.93

29.60

Return On Capital Employed

43.67

45.06

20.32

28.93

29.60

Return On Shareholders' Funds/Equity

33.04

33.66

14.53

20.25

23.30

Dividend Pay Out Ratio (Times)

0.68

1.06

1.49

0.83

-

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

 


 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.66.14

UK Pound

1

Rs.98.69

Euro

1

Rs.72.55

MYR

1

Rs.15.45

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

 

 

INFORMATION DETAILS

 

Analysis Done by :

KAS

 

 

Report Prepared by :

TRU

 


 

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.