MIRA INFORM REPORT

 

 

Report No. :

307362

Report Date :

17.02.2015

 

IDENTIFICATION DETAILS

 

Name :

TEONG FATT COMMODITIES (M) SDN. BHD.

 

 

Registered Office :

35, Jalan Kelisa Emas 1, Taman Kelisa Emas, 1st Floor, 13700 Perai, Pulau Pinang

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.08.2013

 

 

Date of Incorporation :

27.05.1991

 

 

Com. Reg. No.:

217777-X

 

 

Legal Form :

Private Limited Company

 

 

Line of Business :

Engaged in trading of Agricultural Product including Beans, Daal, Herbs, Spices, Dried fruits & Essential Oils

 

 

No of Employees :

25 (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 :

Satisfactory

Payment Behaviour :

No Complaints

Litigation :

Clear 

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – December 31, 2014

 

Country Name

Previous Rating

(30.09.2014)

Current Rating

(31.12.2014)

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 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. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplies about 32% of government revenue in 2013. 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.

 

Source : CIA

 

 

EXECUTIVE SUMMARY

 

 

REGISTRATION NO.

:

217777-X

COMPANY NAME

:

TEONG FATT COMMODITIES (M) SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

27/05/1991

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

35, JALAN KELISA EMAS 1, TAMAN KELISA EMAS, 1ST FLOOR, 13700 PERAI, PULAU PINANG, MALAYSIA.

BUSINESS ADDRESS

:

4181, LORONG PERDA UTAMA 7, BANDAR PERDA, 14000 BUKIT MERTAJAM, PULAU PINANG, MALAYSIA.

TEL.NO.

:

04-5379996

FAX.NO.

:

04-5376669

CONTACT PERSON

:

NG TENG SEAH ( DIRECTOR )

INDUSTRY CODE

:

46329

PRINCIPAL ACTIVITY

:

Engaged in trading of Agricultural Product including Beans, Daal, Herbs, Spices, Dried fruits & Essential Oils

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 1,150,000.00 DIVIDED INTO 
ORDINARY SHARES 1,150,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 23,304,705 [2013]

NET WORTH

:

MYR 7,108,737 [2013]

STAFF STRENGTH

:

25 [2015]

BANKER (S)

:

EON BANK BHD
HONG LEONG BANK BHD
MALAYAN BANKING BHD
OCBC BANK (MALAYSIA) BHD
PUBLIC BANK BHD
UNITED OVERSEAS BANK (MALAYSIA) BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

LIMITED

PAYMENT

:

No Complaints 

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) trading of agricultural product.

 

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

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

29/02/2012

MYR 5,000,000.00

MYR 1,150,000.00

10/08/1992

MYR 1,000,000.00

MYR 1,000,000.00

09/03/1992

MYR 1,000,000.00

MYR 500,000.00

06/06/1991

MYR 2.00

 

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


Name

Address

IC/PP/Loc No

Shareholding

(%)

TEOH SIAM LOH

429, JALAN MARKET, 09800 SERDANG, KEDAH, MALAYSIA.

0977434

259,337.00

22.55

MR. NG CHUN LAI

11, LORONG TAMBUN INDAH 8, TAMAN TAMBUN INDAH, 14100 SIMPANG AMPAT, PULAU PINANG, MALAYSIA.

490824-02-5337 2406593

224,171.00

19.49

SIM LEO SUAN
[EXECUTOR AND TRUSTEE OF THE ESTATE OF NG CHOON CHOOI]

326, LORONG KENANGAN 9, TAMAN KENANGAN, SUNGAI KARANGAN, 09410 PADANG SERAI, KEDAH, MALAYSIA.

430319-07-5208 3082695

177,789.00

15.46

MR. NG TENG SEAH +

11, LORONG TAMBUN INDAH 8, TAMAN TAMBUN INDAH, 14100 SIMPANG AMPAT, PULAU PINANG, MALAYSIA.

800709-07-5057

100,000.00

8.70

NG CHYE HOCK

429, JALAN MARKET, 09800 SERDANG, KEDAH, MALAYSIA.

7013666

81,114.00

7.05

TAN SWEE LENG

31, TAMAN SENTOSA, 02000 KUALA PERLIS, PERLIS, MALAYSIA.

2958896

70,936.00

6.17

TAN SWEE PHENG

31, TAMAN SENTOSA, 02000 KUALA PERLIS, PERLIS, MALAYSIA.

A0706802

70,935.00

6.17

MS. KHAW AH CHOON

5, TINGKAT BINJAI 30, TAMAN SRI RAMBAI, 14000 BUKIT MERTAJAM, PULAU PINANG, MALAYSIA.

530530-07-5260 4485753

55,240.00

4.80

MR. NG SIAN KHIM

1779, JALAN NANGKA, TAMAN GEMILANG RIA, 14000 BUKIT MERTAJAM, PULAU PINANG, MALAYSIA.

851127-02-5703

55,239.00

4.80

MR. NG SONG CHYE

5, TINGKAT BINJAI 30, TAMAN SRI RAMBAI, 14000 BUKIT MERTAJAM, PULAU PINANG, MALAYSIA.

880221-35-5269

55,239.00

4.80

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

------

1,150,000.00

100.00

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

=====

+ Also Director

 

 

DIRECTORS

 

DIRECTOR 1

Name Of Subject

:

MS. NG SWEE LUANG

Address

:

429, JALAN PASAR, 09800 SERDANG, KEDAH, MALAYSIA.

IC / PP No

:

A0273319

New IC No

:

650907-02-5666

Date of Birth

:

07/09/1965

Nationality

:

MALAYSIAN CHINESE

Date of Appointment

:

28/08/1997

 

DIRECTOR 2

Name Of Subject

:

MR. NG TENG SEAH

Address

:

11, LORONG TAMBUN INDAH 8, TAMAN TAMBUN INDAH, 14100 SIMPANG AMPAT, PULAU PINANG, MALAYSIA.

New IC No

:

800709-07-5057

Date of Birth

:

09/07/1980

Nationality

:

MALAYSIAN

Date of Appointment

:

28/11/2012

 

MANAGEMENT

 

 

 

1)

Name of Subject

:

NG TENG SEAH

Position

:

DIRECTOR

 

 

 

AUDITOR

 

Auditor

:

SH YEOH & CO.

Auditor' Address

:

37, JALAN KELISA EMAS 1, TAMAN KELISA EMAS, 13700 PERAI, PULAU PINANG, MALAYSIA.

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. LIM KIM TECK

IC / PP No

:

5538757

New IC No

:

590613-07-5607

Address

:

40, HALAMAN BUKIT GAMBIER 5, 11700 GELUGOR, PULAU PINANG, MALAYSIA.

 

2)

Company Secretary

:

MR. KONG SOWN KAEY

IC / PP No

:

A2556365

New IC No

:

731205-07-5225

Address

:

121, JALAN BINJAI, TAMAN SRI RAMBAI, 14000 BUKIT MERTAJAM, PULAU PINANG, MALAYSIA.

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

EON BANK BHD

 

2)

Name

:

HONG LEONG BANK BHD

 

3)

Name

:

MALAYAN BANKING BHD

 

4)

Name

:

OCBC BANK (MALAYSIA) BHD

 

5)

Name

:

PUBLIC BANK BHD

 

6)

Name

:

UNITED OVERSEAS BANK (MALAYSIA) BHD

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

28/12/1992

N/A

ABN AMRO BANK BHD

MYR 3,800,000.00

Satisfied

2

28/12/1992

N/A

UNITED MALAYAN BANKING CORPORATION BERHAD

MYR 570,000.00

Satisfied

3

26/04/1994

N/A

ABN AMRO BANK NV

MYR 500,000.00

Satisfied

4

03/05/1995

N/A

ABN AMRO BANK BHD

MYR 4,300,000.00

Satisfied

5

06/06/1997

N/A

HONG LEONG BANK BHD

MYR 6,000,000.00

Satisfied

6

06/06/1997

N/A

HONG LEONG BANK BHDHD

MYR 6,000,000.00

Satisfied

7

06/07/2000

N/A

MALAYAN BANKING BERHAD

MYR 1,800,000.00

Satisfied

8

02/10/2002

N/A

PUBLIC BANK BERHAD

MYR 600,000.00

Satisfied

9

30/10/2002

CHARGE IN FORM 16A

EON BANK BERHAD

MYR 1,175,000.00

Satisfied

10

30/10/2002

THIRD LEGAL CHARGE

EON BANK BERHAD

MYR 125,000.00

Satisfied

11

25/05/2004

THIRD LEGAL CHARGE

EON BANK BERHAD

MYR 250,000.00

Satisfied

12

03/10/2005

OPEN CHARGE

OCBC BANK (MALAYSIA) BHD

MYR 1,700,000.00

Unsatisfied

13

03/10/2005

OPEN CHARGE

OCBC BANK (MALAYSIA) BHD

MYR 950,000.00

Unsatisfied

14

03/10/2005

OPEN CHARGE

OCBC BANK (MALAYSIA) BHD

MYR 1,500,000.00

Unsatisfied

15

03/10/2005

FOURTH LEGAL CHARGE

OCBC BANK (MALAYSIA) BHD

MYR 800,000.00

Unsatisfied

16

15/05/2006

FOURTH LEGAL CHARGE

EON BANK BHD

MYR 500,000.00

Satisfied

17

17/09/2007

1ST PARTY 1ST LEGAL CHARGE

UNITED OVERSEAS BANK (MALAYSIA) BHD

MYR 5,000,000.00

Unsatisfied

18

17/09/2007

1ST PARTY 1ST LEGAL CHARGE

UNITED OVERSEAS BANK (MALAYSIA) BHD

MYR 5,000,000.00

Unsatisfied

19

17/10/2007

1ST PARTY 5TH LEGAL CHARGE

OCBC BANK (MALAYSIA) BHD

-

Unsatisfied

20

17/10/2007

1ST PARTY 6TH LEGAL CHARGE

OCBC BANK (MALAYSIA) BHD

MYR 1,300,000.00

Unsatisfied

21

23/04/2014

MEMORANDUM OF LEGAL CHARGE OVER DEPOSIT

UNITED OVERSEAS BANK (MALAYSIA) BHD

-

Unsatisfied

22

14/08/2014

LETTER OF SET-OFF

HONG LEONG BANK BERHAD

-

Unsatisfied

 

 

LITIGATION CHECK AGAINST SUBJECT


* A check has been conducted in our databank against 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

Import Countries

:

CHINA,INDIA,THAILAND


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

[

X

]

Average 61-90 Days

[

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Export Market

:

SINGAPORE

Credit Term

:

30 - 60 DAYS

Payment Mode

:

CHEQUES
CASH

Type of Customer

:

WHOLESALERS,DISTRIBUTORS

 

OPERATIONS

 

Goods Traded

:

AGRICULTURAL PRODUCTS

Ownership of premises

:

OWNED

 

Total Number of Employees:

 

YEAR

2015

2013

2012

2011

2010


GROUP

N/A

N/A

N/A

N/A

N/A

COMPANY

25

25

25

30

30

 

Branch

:

NO

 

Other Information:

The Subject is principally engaged in the (as a / as an) trading of agricultural product. 

 

The Subject offers a wide range of agricultural food products including Beans, Daal, Herbs, Spices, Dried fruits & Essential Oils


Besides that the Subject also provides products based on the customers' requirements.

The Subject sells its products in large quantities. 

 

CURRENT INVESTIGATION


Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

04-5379996

Match

:

N/A

Address Provided by Client

:

4181, LORONG PERDA UTAMA 7, BANDAR PERDA,14000,BUKIT TENGAH,PULAU PINANG.

Current Address

:

4181, LORONG PERDA UTAMA 7, BANDAR PERDA, 14000 BUKIT MERTAJAM, PULAU PINANG, MALAYSIA.

Match

:

YES

Latest Financial Accounts

:

YES

 

Other Investigations

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

 

FINANCIAL ANALYSIS

 

 

Profitability

Turnover

:

Decreased

[

2009 - 2013

]

Profit/(Loss) Before Tax

:

Increased

[

2009 - 2013

]

Return on Shareholder Funds

:

Unfavourable

[

7.18%

]

Return on Net Assets

:

Acceptable

[

12.19%

]

The continuous fall in turnover could be due to the lower demand for the Subject's products / services.The Subject's management have been efficient in controlling its operating costs. The unfavourable return on shareholders' funds could indicate that the Subject was inefficient in utilising its assets to generate returns.

Working Capital Control

Stock Ratio

:

Favourable

[

32 Days

]

Debtor Ratio

:

Acceptable

[

58 Days

]

Creditors Ratio

:

Favourable

[

5 Days

]

The Subject's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. The Subject's management was quite efficient in handling its debtors. The Subject's debtors days were at an acceptable range, thus the risk of its debts turning bad was minimised. 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

:

Acceptable

[

0.98 Times

]

Current Ratio

:

Unfavourable

[

1.25 Times

]

The Subject's liquid ratio was slightly low. This could indicate that the Subject's working capital was slightly deficient. The Subject will have to improve its liquidity position either by obtaining short term financing or increase its paid up capital so that it can meet all its short term obligations as and when they fall due.

Solvency

Interest Cover

:

Unfavourable

[

2.83 Times

]

Gearing Ratio

:

Acceptable

[

0.97 Times

]

The Subject's interest cover was low. If its profits fall or when interest rate rises, it  may not be able to meet all its interest payment. 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 :

Due to the efficient control of its operating costs, the Subject was able to remain profitable despite lower turnover achieved during the year. The Subject's liquidity was at an acceptable range. If the Subject is able to obtain further short term financing, it should be able to meet all its short term obligations. If there is a fall in the Subject's profit or any increase in interest rate, the Subject may not be able to generate sufficient cash-flow to service its interest. 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 : LIMITED

 

 

 

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

3.3

4.0

Unemployment Rate

3.3

3.2

3.0

3.0

3.0

Net International Reserves ( MYR Billion )

415

427

-

417

-

Average Risk-Weighted Capital Adequacy Ratio ( % )

3.50

2.20

-

-

-

Average 3 Months of Non-performing Loans ( % )

14.80

14.70

-

-

-

Average Base Lending Rate ( % )

6.60

6.53

6.53

-

-

Business Loans Disbursed( % )

15.3

32.2

-

-

-

Foreign Investment ( MYR Million )

23,546.1

26,230.4

38,238.0

-

-

Consumer Loans ( % )

-

-

-

-

-

Registration of New Companies ( No. )

45,455

45,441

46,321

-

-

Registration of New Companies ( % )

3.0

(0.0)

1.9

-

-

Liquidation of Companies ( No. )

132,485

17,092

26,430

-

-

Liquidation of Companies ( % )

417.8

(87.1)

54.6

-

-

Registration of New Business ( No. )

284,598

324,761

329,895

-

-

Registration of New Business ( % )

5.0

14.0

2.0

-

-

Business Dissolved ( No. )

20,121

20,380

18,161

-

-

Business Dissolved ( % )

1.9

1.3

(10.9)

-

-

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

-

-

Credit Cards Spending ( % )

15.6

12.6

-

-

-

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)

-

-

-

-

Other Mining

-

-

-

-

-

Industry Non-performing Loans ( MYR Million )

46.5

-

-

-

-

% of Industry Non-performing Loans

0.1

-

-

-

-

Manufacturing #

4.7

4.8

3.4

6.6

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

-

-

Plastic Products

3.8

-

-

-

-

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

-

-

-

-

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 
(Source : Department of Statistics / Economic Report / Bank Negara Report)



INDUSTRY ANALYSIS

 

MSIC CODE

46329 : Wholesale of other foodstuffs

INDUSTRY :

TRADING

The wholesale and retail trade is expected to increase 7.1% in 2015 (2014: 7.7%) driven by strong domestic consumption and higher tourist arrivals following the Malaysia Year of Festivals 2015. Besides, in 2014, the wholesale and retail trade subsector is expected to increase 7.7% (2013: 6.4%) supported by strong domestic consumption.

According to Retail Group Malaysia (RGM), the pharmacy and personal care sub-sector had slow growth rate of 2.6% for the first quarter of 2014, while "other specialty stores" grew at a rate of 3.5%. During the first quarter of 2014, fashion and fashion accessories recorded a sustainable growth of 6.3% as compared with the same period last year (3.6%).

The retail segment increased 10.1% (January - June 2013: 7.1%) attributed to brisk sales in retail outlets such as hypermarkets and large-scale superstores. Since the launch of the Small Retailer Transformation programme (TUKAR) in January 2011 up to end-July 2014, 1,761 small retailer stores (end-July 2013: 1,381) have been modernized to improve their competitiveness. In addition, the strong growth of the retail segment was supported by 1Malaysia Unified Sales held from 29 June 2014 to 1 September 2014 to attract foreign and local tourists to shop in Malaysia. Meanwhile, the wholesale segment expanded 8.2% (January - June 2013: 4.9%) due to higher sales of non-agricultural intermediate products, such as petrol, diesel, lubricants and household goods. Furthermore, food and beverage outlets, laundry outlets, car wash centres, abd health and beauty outlets took a hit from the water rationing in the Klang Valley since February this year.

On the other hand, in 2014, Malaysia's total trade is expected to grow 5.2% to RM1.44 trillion (2013: 4.5%; RM1.37 trillion) underpinned by recovery in key advanced economies, resilient regional demand, and partly due to the base effect arising from sluggish exports in the corresponding period last year. Gross exports are anticipated to expand 6% to RM762.8 billion while import decreased 4.3% to RM677.2 billion (2013: 2.4%; RM719.8 billion; 7%; RM 649.1 billion). Consequently, the trade surplus is expected to be higher at RM85.6 billion or 7.9% of GDP in 2014 (2013: RM70.7 billion; 7.2%).

Furthermore, gross exports rebounded by 10.7% to RM441.3 billion during the first seven months of 2014 (January - July 2013: -2.8%; RM398.5 billion), with manufactured and mining exports rising at a double digit pace of 11.4% and 12.5%. Shipment of agriculture products grew at a slower pace of 2.7%, primarily due to lower receipts of crude rubber (-24.6%) while export growth of other commodities remained steady. Consequently, exports of manufactured and mining products are expected to grow 6.1% and 6.4% in 2014 (2013: 5.1%; 3.3%). Meanwhile, agriculture exports are expected to rebound sharply by 4.5% in 2014 (2013: -14.4%) despite moderating commodity prices. Malaysia's top 3 trading partners are China, Singapore, and Japan. 

Over 60% of Gross Domestic Product (GDP) is contributed by domestic consumption. Therefore the wholesale and retail sector plays a crucial role in driving Malaysia's growth over the next decade despite the ongoing global economic slowdown. By 2020, Malaysia's wholesale and retail sector is expected to boost the country's total Gross National Income (GNI) by RM156 billion, creating 454,190 new jobs.

OVERALL INDUSTRY OUTLOOK : Average Growth


CREDIT RISK EVALUATION & RECOMMENDATION

 

 

Incorporated in 1991, the Subject is a Private Limited company, focusing on trading of agricultural product. The Subject has been in business for over two decades. It has built up a strong clientele base and satisfactory reputation will enable the Subject to further enhance its business in the near term.  The Subject is expected to enjoy a stable market shares. With MYR 1,150,000 in issued and paid up capital, the Subject has the potential of capturing a higher market shares as it is competing aggressively in the market. 

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 small company, the Subject's business operation is supported by 25 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. 

Despite the lower turnover, the Subject's pre-tax profit have increased compared to the previous year. The higher profit could be due to better control of its operating costs and efficiency in utilising its resources. The Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. The Subject managed to maintain an adequate liquidity level, indicating that the Subject has the ability to meet its financial obligations. The gearing level of the Subject is slightly high, therefore it faces moderate financial risk. Given a positive net worth standing at MYR 7,108,737, the Subject should be able to maintain its business in the near terms. 

Having a strong assets backing, the Subject possesses latent assets as collateral for further financial extension. Hence, it has good chance of getting loans if the needs arises. 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. 

Overall, the Subject's payment habit is good as the Subject has a good credit control and it could be taking advantage of the cash discounts while maintaining a good reputation with its creditors. 

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)

TEONG FATT COMMODITIES (M) SDN. BHD.

 

Financial Year End

2013-08-31

2012-08-31

2011-08-31

2010-08-31

2009-08-31

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

23,304,705

27,979,594

31,045,592

31,932,626

30,655,153

Other Income

317,489

206,150

-

-

-

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

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

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

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

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

Total Turnover

23,622,194

28,185,744

31,045,592

31,932,626

30,655,153

Costs of Goods Sold

(19,866,472)

(24,054,440)

-

-

-

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

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

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

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

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

Gross Profit

3,755,722

4,131,304

-

-

-

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

611,683

581,877

690,353

719,284

697,854

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

611,683

581,877

690,353

719,284

697,854

Taxation

(101,424)

(153,439)

(161,955)

(205,068)

(186,797)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

510,259

428,438

528,398

514,216

511,057

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

5,448,478

5,020,040

4,491,642

4,264,926

4,041,369

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

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

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

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

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

As restated

5,448,478

5,020,040

4,491,642

4,264,926

4,041,369

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

5,958,737

5,448,478

5,020,040

4,779,142

4,552,426

DIVIDENDS - Ordinary (paid & proposed)

-

-

-

(287,500)

(287,500)

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

5,958,737

5,448,478

5,020,040

4,491,642

4,264,926

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Others

333,959

441,587

472,301

550,708

724,718

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

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

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

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

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

333,959

441,587

472,301

550,708

724,718

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

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

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

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

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

 

 

 

BALANCE SHEET

 

 

TEONG FATT COMMODITIES (M) SDN. BHD.

 

ASSETS EMPLOYED:

FIXED ASSETS

5,725,007

6,255,833

6,661,171

6,761,418

7,089,433

Investments

185,058

185,058

190,987

502,421

606,339

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

185,058

185,058

190,987

502,421

606,339

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

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

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

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

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

TOTAL LONG TERM ASSETS

5,910,065

6,440,891

6,852,158

7,263,839

7,695,772

Stocks

2,022,412

2,069,468

1,949,887

2,304,046

3,077,046

Trade debtors

3,673,886

4,847,333

6,132,854

6,460,348

7,084,292

Other debtors, deposits & prepayments

1,001,250

1,203,626

883,559

912,627

932,147

Short term deposits

-

-

649,483

330,205

323,149

Deposits with financial institutions

1,536,272

928,598

-

-

-

Amount due from director

202,457

99,854

755,303

676,618

716,377

Cash & bank balances

652,172

215,283

360,761

405,958

653,363

Others

20,531

-

-

-

-

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

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

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

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

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

TOTAL CURRENT ASSETS

9,108,980

9,364,162

10,731,847

11,089,802

12,786,374

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

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

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

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

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

TOTAL ASSET

15,019,045

15,805,053

17,584,005

18,353,641

20,482,146

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

250,488

669,581

1,367,100

275,343

701,997

Other creditors & accruals

634,252

813,225

572,999

606,012

416,263

Hire purchase & lease creditors

93,444

113,049

139,761

123,678

124,936

Bank overdraft

-

85,021

-

398,038

-

Short term borrowings/Term loans

110,337

102,100

94,319

172,285

151,938

Bill & acceptances payable

6,156,000

6,549,000

8,148,000

8,628,000

10,517,000

Amounts owing to director

15,696

-

-

39,236

41,430

Provision for taxation

-

15,942

9,079

53,136

30,817

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

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

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

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

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

TOTAL CURRENT LIABILITIES

7,260,217

8,347,918

10,331,258

10,295,728

11,984,381

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

1,848,763

1,016,244

400,589

794,074

801,993

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

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

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

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

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

TOTAL NET ASSETS

7,758,828

7,457,135

7,252,747

8,057,913

8,497,765

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

1,150,000

1,150,000

1,150,000

1,150,000

1,150,000

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

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

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

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

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

TOTAL SHARE CAPITAL

1,150,000

1,150,000

1,150,000

1,150,000

1,150,000

Retained profit/(loss) carried forward

5,958,737

5,448,478

5,020,040

4,491,642

4,264,926

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

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

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

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

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

TOTAL RESERVES

5,958,737

5,448,478

5,020,040

4,491,642

4,264,926

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

7,108,737

6,598,478

6,170,040

5,641,642

5,414,926

Long term loans

503,900

628,150

745,521

2,119,529

2,713,174

Hire purchase creditors

36,191

125,507

236,186

199,742

283,665

Deferred taxation

110,000

105,000

101,000

97,000

86,000

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

650,091

858,657

1,082,707

2,416,271

3,082,839

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

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

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

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

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

7,758,828

7,457,135

7,252,747

8,057,913

8,497,765

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

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

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

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

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

 

 

 

FINANCIAL RATIO

 

 

TEONG FATT COMMODITIES (M) SDN. BHD.

 

TYPES OF FUNDS

Cash

652,172

215,283

1,010,244

736,163

976,512

Net Liquid Funds

(5,503,828)

(6,418,738)

(7,137,756)

(8,289,875)

(9,540,488)

Net Liquid Assets

(173,649)

(1,053,224)

(1,549,298)

(1,509,972)

(2,275,053)

Net Current Assets/(Liabilities)

1,848,763

1,016,244

400,589

794,074

801,993

Net Tangible Assets

7,758,828

7,457,135

7,252,747

8,057,913

8,497,765

Net Monetary Assets

(823,740)

(1,911,881)

(2,632,005)

(3,926,243)

(5,357,892)

BALANCE SHEET ITEMS

Total Borrowings

6,899,872

7,602,827

9,363,787

11,641,272

13,790,713

Total Liabilities

7,910,308

9,206,575

11,413,965

12,711,999

15,067,220

Total Assets

15,019,045

15,805,053

17,584,005

18,353,641

20,482,146

Net Assets

7,758,828

7,457,135

7,252,747

8,057,913

8,497,765

Net Assets Backing

7,108,737

6,598,478

6,170,040

5,641,642

5,414,926

Shareholders' Funds

7,108,737

6,598,478

6,170,040

5,641,642

5,414,926

Total Share Capital

1,150,000

1,150,000

1,150,000

1,150,000

1,150,000

Total Reserves

5,958,737

5,448,478

5,020,040

4,491,642

4,264,926

LIQUIDITY (Times)

Cash Ratio

0.09

0.03

0.10

0.07

0.08

Liquid Ratio

0.98

0.87

0.85

0.85

0.81

Current Ratio

1.25

1.12

1.04

1.08

1.07

WORKING CAPITAL CONTROL (Days)

Stock Ratio

32

27

23

26

37

Debtors Ratio

58

63

72

74

84

Creditors Ratio

5

10

16

3

8

SOLVENCY RATIOS (Times)

Gearing Ratio

0.97

1.15

1.52

2.06

2.55

Liabilities Ratio

1.11

1.40

1.85

2.25

2.78

Times Interest Earned Ratio

2.83

2.32

2.46

2.31

1.96

Assets Backing Ratio

6.75

6.48

6.31

7.01

7.39

PERFORMANCE RATIO (%)

Operating Profit Margin

2.62

2.08

2.22

2.25

2.28

Net Profit Margin

2.19

1.53

1.70

1.61

1.67

Return On Net Assets

12.19

13.72

16.03

15.76

16.74

Return On Capital Employed

12.04

13.37

15.73

14.80

16.50

Return On Shareholders' Funds/Equity

7.18

6.49

8.56

9.11

9.44

Dividend Pay Out Ratio (Times)

0.00

0.00

0.00

0.56

0.56

 

 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.62.20

UK Pound

1

Rs.95.99

Euro

1

Rs.71.00

 

INFORMATION DETAILS

 

Analysis Done by :

RAS

 

 

Report Prepared by :

MNL

 

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.