MIRA INFORM REPORT

Report No. :	307759
Report Date :	18.02.2015

IDENTIFICATION DETAILS

Name :	TERRA SPORT SRL
Registered Office :	Bucharest, sector 6 – Cetatea de Balta Street No. 11-39, Bl. 31, Ap. 8
Country :	Romania
Financials (as on) :	30.06.2014
Date of Incorporation :	September, 2001
Legal Form :	Limited liability company
Line of Business :	Wholesale of Clothing and Footwear.
No. of Employee :	8 (30.06.2014)_

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)
Romania	B1	B1

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

ROMANIA ECONOMIC OVERVIEW

Romania, which joined the EU on 1 January 2007, began the transition from Communism in 1989 with a largely obsolete industrial base and a pattern of output unsuited to the country's needs. The country emerged in 2000 from a punishing three-year recession due to strong demand in EU export markets. Domestic consumption and investment fueled strong GDP growth, but led to large current account imbalances. Romania's macroeconomic gains have only recently started to spur creation of a middle class and to address Romania's widespread poverty. Corruption and red tape continue to permeate the business environment. As a result of the global financial crisis, Romania signed on to a $26 billion emergency assistance package from the IMF, the EU, and other international lenders. GDP contracted from 2009 to 2011. In March 2011, Romania and the IMF/EU/World Bank signed a 24-month precautionary stand-by agreement, worth $6.6 billion, to promote fiscal discipline, encourage progress on structural reforms, and strengthen financial sector stability. In September 2013, the Romanian authorities and the IMF/EU agreed to a follow-on stand-by agreement, worth $5.4 billion, to continue with reforms, although Bucharest announced that it does not intend to draw funds under the agreement. Economic growth accelerated in 2013, driven by strong industrial exports and an excellent agricultural harvest; in December 2013 inflation dropped to a historical low annual rate of 1.6%; and the current account deficit was reduced substantially. Yet, progress on structural reforms is uneven and the economy still is vulnerable to shocks.

Source : CIA

COMPANY NAME and address

NAME OF THE COMPANY

TERRA SPORT SRL

Address

Bucharest, sector 6 – Cetatea de Balta Street No. 11-39, Bl. 31, Ap. 8 headquarters

N.B.: The address indicated by you – Bucharest, sector 6 – Drumul Bacriului 57 – is a work-shop (see below)

Phone no.

0040-21-3242061, 3243075

0040-31-7102268

Fax no.

0040-21-3243075

Web-site

www.terrasport.ro

E-mail address

office@terrasport.ro

HISTORIC/OFFICIAL DATA

Date of foundation

September, 2001

Present legal form

Limited liability company

Registered with the Trade Registry

J40/7497/2001

VAT no.

14157081

Registered capital

200 RON

(the minimum share-capital requested by the Law as for a limited liability company)

Shareholders

Individuals

1. Mr. Mihai Dumitru – Romanian citizen, born on 13.05.1964

Participation

50%

2. Mr. Cretu Vasile – Romanian citizen, born on 26.05.1970

Participation

50%

Obligation to publish

According to the Romanian Financial Legislation, subject company is obliged to lodge with the Ministry of Public Finance its half-yearly accounts

EMPLOYEES

2009

2010

2011

2012

2013

30.06.2014

total

9

9

8

8

8

8

BUSINESS ACTIVITY

- Wholesale of clothing and footwear, according to the National Trade Registry updated files (NACE: 4642)

According to the company’s web-site

- trade with sports equipment: clothes, footwear, balls, gloves, endowments, accessories, devices and protection,. for many kind of sports

Unique importer of REUSCH, NEXO and RUCANOR articles.

Work-shops

Bucharest, sector 2 – Basarabia Blvd. No. 94

Bucharest, sector 6 – Drunmul Bacriului No. 57

OTHER PARTICIPATION

1. Company’s participation

not applicable

2. Shareholders other participation

1. Mr. Mihai Dumitru

PRIMO SUPER SRL – J40/6253/2003, VAT 15422275

2. Mr. Cretu Vasile

PRIMO SUPER SRL – J40/6253/2003, VAT 15422275

TANGIBLES*

54,276 RON, at 30.06.2014

*According to the accounting standards, for the middle of the year the company is not obliged to detail its tangible assets. Therefore, the real estates are included in “Tangibles” position among the other assets

BANKS

Transilvania Bank

MANAGEMENT

· as officially registered with the National Trade Registry

Administrators

Mr. Mihai Dumitru – appointed on 9.08.2001 for unlimited period

Mr. Cretu Vasile – appointed on 9.08.2001 for unlimited period

CURRENCY

Exchange rate of EURO

1 EURO = 4.2282 RON on 31.12.2009

1 EURO = 4.2848 RON on 31.12.2010

1 EURO = 4.3197 RON on 31.12.2011

1 EURO = 4.4287 RON on 31.12.2012

1 EURO = 4.4847 RON on 31.12.2013

1 EURO = 4.3888 RON on 30.06.2014

FINANCIAL DATA: RON

BALANCE SHEET	31.12.2011	31.12.2012	31.12.2013	30.06.2014
INTANGIBLES - TOTAL	0	0	818	773
TANGIBLES - TOTAL	519.413	291.708	102.507	54.276
FINANCIALS - TOTAL	18.432	19.012	18.924	18.691
FIXED ASSETS - TOTAL	537.845	310.720	122.249	73.740
STOCKS - TOTAL	1.376.242	1.491.305	1.423.201	1.645.056
CLAIMS - TOTAL	572.661	534.036	611.368	375.062
CURRENT ASSETS	2.385.065	2.547.914	2.746.445	2.623.180
PREPAID EXPENSES	18.855	12.536	12.679	17.636
DEBTS WITHIN 1 YEAR	970.180	847.991	672.027	605.278
DEBTS OVER 1 YEAR	10.732	0	0	0
PROVISIONS	0	0	0	0
ADVANCED INCOMES	0	0	0	0
REGISTERED CAPITAL	200	200	200	200
RESERVES	N/A	N/A	N/A	N/A
NET RESULT - PROFIT	51.240	62.325	186.167	18.982
NET RESULT - LOSS	0	0	0	0
NET WORTH	1.960.853	2.023.179	2.209.346	2.109.278
PROFIT & LOSS ACCOUNT	31.12.2011	31.12.2012	31.12.2013	30.06.2014
Turnover	2.696.172	3.013.286	3.332.723	1.247.690
Own production & services	N/A	N/A	N/A	N/A
Sales	N/A	N/A	N/A	N/A
INCOMES FROM ORDINARY OPERATING ACTIVITY	2.702.918	3.032.202	3.349.589	1.255.033
Raw materials	N/A	N/A	N/A	N/A
Costs of goods sold	N/A	N/A	N/A	N/A
Wages	N/A	N/A	N/A	N/A
Depreciations & provisions	N/A	N/A	N/A	N/A
Other operating costs	N/A	N/A	N/A	N/A
COSTS OF ORDINARY OPERATING ACTIVITY	2.626.094	2.949.891	3.116.547	1.223.926
ORDINARY OPERATING RESULT - PROFIT	76.824	82.311	233.042	31.107
ORDINARY OPERATING RESULT - LOSS	0	0	0	0
FINANCIAL INCOMES	93.849	77.129	63.686	11.300
FINANCIAL COSTS	111.239	83.841	70.129	16.676
FINANCIAL RESULT - PROFIT	0	0	0	0
FINANCIAL RESULT - LOSS	17.390	6.712	6.443	5.376
CURRENT RESULT - PROFIT	59.434	75.599	226.599	25.731
CURRENT RESULT - LOSS	0	0	0	0
Extraordinary incomes	0	0	0	0
Extraordinary costs	0	0	0	0
EXTRAORDINARY RESULT - PROFIT	0	0	0	0
EXTRAORDINARY RESULT - LOSS	0	0	0	0
TOTAL INCOMES	2.796.767	3.109.331	3.413.275	1.266.333
TOTAL COSTS	2.737.333	3.033.732	3.186.676	1.240.602
PRETAX RESULT - PROFIT	59.434	75.599	226.599	25.731
PRETAX RESULT - LOSS	0	0	0	0
TAX ON PROFIT	8.194	13.274	40.432	6.749
NET RESULT - PROFIT	51.240	62.325	186.167	18.982
NET RESULT - LOSS	2.626.094	2.949.891	3.116.547	1.223.926

N.B.: any difference occurred between former reports and the present one regarding some positions of the “Balance Sheet” or P/L Account for previous periods does not belong to us.

The financial data from this report are the ones officially declared by the subject with the Ministry of Public Finance data basis for 30.06.2014. As consequence, the responsibility for their accuracy belongs exclusively to the company.

OUR OPINION

based upon financial figures reported in the latest balance-sheet – 30.06.2014

- all figures are reported in RON if otherwise not specified.

Size

micro, considering the total no. of employees.

Position & trend

Fair business volume, with certain fluctuations of turnover in the investigated period and generally moderate returns.

Nontheless, the figures at hand describe a rather fair financial standing.

Yet, the payments behaviour is facing problems and the delays represent 34% of turnover (69% of total debt). The most of the delays are over 1 year!

The business relationships are feasible, but due to the payments behavior, we do appreciate the credit based transactions should be secured.

The business trend should be followed.

31.12.2009

31.12.2010

31.12.2011

31.12.2012

31.12.2013

30.06.2014

Turnover

RON

3,964,267

3,220,958

2,696,172

3,013,286

2,221,723

1,247,690

EURO

937,578

751,717

624,157

680,400

495,401

284,290

Gross profit

RON

87,569

-60,030

59,434

75,599

226,599

25,731

EURO

20,711

-14,010

13,759

17,070

50,527

5,863

Net profit

RON

56,938

-66,480

51,240

62,325

186,167

18,982

EURO

13,466

-15,515

11,862

14,073

41,512

4,325

30.06.2014

CREDITS & LOANS (ACTIVE BALANCE)

N/A

BALANCE CLAIMS-DEBTS

negative

Total claims; no further details are available

375,062

Total debts, 100% on short term; no further details are available

605,278

PAYMENTS BEHAVIOR

with delays

Total overdue of 33.52% of turnover (69.09% of total short term debt)

418,202

To suppliers

418,202

over 30 days

15,907

over 90 days

36,209

over 1 year

366,086

PAYMENTS INCIDENTS, as

officially recorded with the Payment Incident Bureau

No incidents recorded in the period 16.02.2014 – 16.02.2015

BLACKLISTING (international sanctions)

Not applicable

FINANCIAL STRENGTH

940,000 EURO

RISK CATEGORY

Above normal

BUSINESS RELATIONS

Under secured terms

Applies to short term credit facilities and should not be construed as a maximum credit limit, which can be only established by the supplier. The credit limit has been set using a formula which takes into consideration the credit rating, and the latest behavioral and financial performances. Other information may of course influence the size of the credit you may grant.

2009

2010

2011

2012

2013

30.06.2014

Mostly very good

Liquidity analysis

- current ratio

1.72

1.87

2.46

3.00

4.09

4.33

- quick ratio

0.73

0.86

1.04

1.25

1.97

1.62

Solvability analysis

Constant very good

- the borrowing ratio (total debts/net worth)

0.84

0.70

0.50

0.42

0.30

0.29

Profitability analysis (%)

Mostly moderate

- return on capital

2.88

loss

2.61

3.08

8.43

0.90

- return on assets

1.57

loss

1.74

2.17

6.46

0.70

- gross profit margin

2.21

loss

2.20

2.51

10.20

2.06

Activity analysis

The debtors settlements is not too good, generally

- debtor’s days

133

117

78

65

100

54

- creditor’s days

n/a

n/a

n/a

n/a

n/a

n/a

Stocks turnover, times/period

2

2

2

2

2

1

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.20
UK Pound	1	Rs.96.00
Euro	1	Rs.71.00

INFORMATION DETAILS

Analysis Done by :	RAS
Report Prepared by :	ANK

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
--	NB	New Business	--

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

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.