|
Report No. : |
304459 |
|
Report Date : |
27.01.2015 |
IDENTIFICATION DETAILS
|
Name : |
HONIGMAN & SONS LTD. |
|
|
|
|
Registered Office : |
58 Salame Road TEL AVIV 6607401 |
|
|
|
|
Country : |
Israel |
|
|
|
|
Date of Incorporation : |
1947 |
|
|
|
|
Legal Form : |
Private Limited Company |
|
|
|
|
Line of Business : |
Manufacturers (via foreign subcontractors abroad), importers, marketers
and retailers of women, men, and children fashion |
|
|
|
|
No. of Employee : |
Not Available |
RATING & COMMENTS
|
MIRA’s Rating : |
B |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
Status : |
Moderate |
|
|
|
|
Payment Behaviour : |
Unknown |
|
|
|
|
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 – September 30, 2014
|
Country Name |
Previous Rating (30.06.2014) |
Current Rating (30.09.2014) |
|
Israel |
A2 |
A2 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
ISRAEL ECONOMIC OVERVIEW
Israel has a technologically advanced market economy. Cut diamonds, high-technology equipment, and pharmaceuticals are among the leading exports. Its major imports include crude oil, grains, raw materials, and military equipment. Israel usually posts sizable trade deficits, which are covered by tourism and other service exports, as well as significant foreign investment inflows. Between 2004 and 2011, growth averaged nearly 5% per year, led by exports. The global financial crisis of 2008-09 spurred a brief recession in Israel, but the country entered the crisis with solid fundamentals, following years of prudent fiscal policy and a resilient banking sector. In 2010, Israel formally acceded to the OECD. Israel's economy also has weathered the Arab Spring because strong trade ties outside the Middle East have insulated the economy from spillover effects. The economy has recovered better than most advanced, comparably sized economies, but slowing demand domestically and internationally, and a strong shekel, have reduced forecasts for the next decade to the 3% level. Natural gas fields discovered off Israel's coast since 2009 have brightened Israel's energy security outlook. The Tamar and Leviathan fields were some of the world's largest offshore natural gas finds this past decade. The massive Leviathan field is not due to come online until 2018, but production from Tamar provided a one percentage point boost to Israel's GDP in 2013 and is expected to contribute 0.5% growth in 2014. In mid-2011, public protests arose around income inequality and rising housing and commodity prices. Israel's income inequality and poverty rates are among the highest of OECD countries and there is a broad perception among the public that a small number of "tycoons" have a cartel-like grip over the major parts of the economy. The government formed committees to address some of the grievances but has maintained that it will not engage in deficit spending to satisfy populist demands. In May 2013 the Israeli government, in a politically difficult process, passed an austerity budget to reign in the deficit and restore confidence in the government's fiscal position. Over the long term, Israel faces structural issues, including low labor participation rates for its fastest growing social segments - the ultra-orthodox and Arab-Israeli communities. Also, Israel's progressive, globally competitive, knowledge-based technology sector employs only 9% of the workforce, with the rest employed in manufacturing and services - sectors which face downward wage pressures from global competition.
|
Source
: CIA |
HONIGMAN &
SONS LTD.
Telephone 972 3 680 55 00; 680 55 55
Fax 972 3 518 05 75
58 Salame Road
TEL AVIV 6607401
ISRAEL
Originally established
as a non-registered business in 1947.
Converted into a
private limited company and registered as such as per file
No. 51-084496-2 on the 19.02.1980.
Authorized share
capital NIS 2,050,000.00, divided into -
2
management shares (issued),
2,049,991
ordinary "A" shares (349,992 shares issued),
7
ordinary shares (6 shares issued), all of NIS 1.00 each,
of which shares
amounting to NIS 350,000.00 were issued.
1.
Jacob Honigman, 50%,
2.
Micha Honigman, 50%.
1.
Micha Honigman, born 1953,
2.
Jacob Honigman, born 1945, founder of subject,
brother of Micha.
Micha Ronen.
Manufacturers (via foreign subcontractors abroad),
importers, marketers and retailers of women, men, and children fashion.
Operating 166 shops (had 163 shops in the
beginning of 2014) throughout Israel, all operated by subject, no
concessionaires. The retail store chains and brand names under the following
categories:
“Honigman” - for women, 47 shops (including
22 jointly with “Honigman Menswear”, for gentlemen); “TNT” - for young ladies,
47 shops; “Honigman Kids” - for kids, 64 shops (including the “Virus” brand of
extreme fashion of kids, and “Honigman Baby”, for babies); Honigman Outlets - 8
branches.
All sales are to
the local market.
Via subsidiary,
operating few retail stores in Europe, mainly in Romania. In addition, via
concessionaires, operating 3 stores in Russia.
Manufacturing is
carried out via subcontractors in India, China and Vietnam.
Most of subject’s
suppliers are foreign.
Advertising
agency: DAVID.
Operating from
main premises (offices and logistics center), on an area of 10,000 sq. meters
(5,000 owned by subject and 5,000 rented), in 58, Salame Road, Tel Aviv, and
from another logistics center, on an rented area of 3,000 sq. meters, in 6
Plotisky Street, Old Industrial Zone, Rishon Le-Zion.
Operating from
some 160 retail stores nationwide.
Having in all some
1,200 employees, as of the end of 2011, similar to 2010 and 2009. Current
number of employees not forthcoming.
According to a
single report from October 2014, subject was valued at NIS 105 million as part of
negotiations for its sale to a local leading fashion chain GOLD AND CO. No
later data found on the matter.
Inventory was
valued at NIS
In January 2014 it
was reported that subject is investing NIS 5 million in a re conception of the
TNT brand – see more in CHARACTER.
Owned property in
58 Salame Street, Tel Aviv valued at several US$ millions.
Annual advertising
budget of 'Honigman' brand as reported in 2012 is NIS 10 million (in real
prices; in pricelist prices, budget was US$ 5.3 million, which equals close to
NIS 20 million). Subject's advertizing budget has been decreasing comparing to
previous years.
Later/ other
financial data not forthcoming.
There are 24
charges for unlimited amounts registered on the company's assets (financial
assets and fixed assets), in favor of Mizrahi Tefahot Bank Ltd.,
Mercantile Discount Bank Ltd., Israel Discount
Bank Ltd., Bank Hapoalim Ltd., The First
International Bank of Israel Bank Ltd., Bank Leumi
Le’Israel Ltd., Bank Otsar Hahayal Ltd. and Union Bank of
Israel Ltd. Last 7 charges placed October - December 2014 on financial, fixed and
other assets to 7 different banks.
2007 sales claimed to be NIS 317 million.
2008 sales claimed to be NIS 350 million.
2009 sales figures not forthcoming.
2010 sales claimed to be NIS 300 million.
Later sales
figures not disclosed, though in a media article in February 2013 it was
estimated that 2012 sales were NIS 330 million (2011 sales unavailable).
According to a report
from August 2013, annual sales are NIS 350 million.
According to
reports from 2014, 2013 sales were circa NIS 340 million.
HONIGMAN ROMANIA
S.R.L, 100%, operating shops in Romania.
HONIGMAN AND SONS
ASSETS (1986) LTD., sister company, a holding company.
Mizrahi Tefahot
Bank Ltd., Tel Aviv Main Business Branch (No. 461), Tel Aviv.
Bank Leumi
Le’Israel Ltd., Allenby Business Branch (No. 802), Tel Aviv.
There is a motion
for class action lawsuit filed against subject in early 2011, by employees
(claiming subject does not pay for overtime), still have to be approved as such
by Court. We found no further data on matter.
In October 2012
the Court rejected another motion for class action lawsuit filed other by
consumers (concerning advertising the TNT brand).
Apart from that,
nothing unfavorable learned.
Subject's
officials refused to update data besides general business activity and branches
numbers.
Subject is a long established
company enjoying a good reputation in its field. It is among the local leading
and popular fashion chain stores with remarkable rate of growth over the last
years, like several other local fashion chains.
It was reported that subject took streamlining measures due to the
slow-down in the local fashion arena in 2009/2010, and according to reports
planed to close down 5 shops during 2011 (after closing 2 shops in 2010). In
November 2011 it was reported that subject is closing 3 TNT losing branches. In
addition, a new General Manager was appointed and downsizing made in logistics
and operations.
In February 2013 it was reported that subject decided to exit the men's
fashion field (which they entered in 2009), which they consider as
unsuccessful, as they were unable to face the competition by rival chains.
Men's fashion contributed only NIS 12 million in sales in 2012. General
Manager, Mr. Ronen said that in the women's fashion they witnessed a two-digit
growth in sales in 2012.
In May 2007, it was
reported that subject is opening a TNT retail chain in Romania, with its first
shop, to be followed by 5 more shops till end of 2007, with total investment of NIS
6 million. The plan was to open 40 stores within next 3-4 years in Romania,
however, due to the global economic in January 2011 subject decided to close
all 9 shops, which inflicted losses of NIS millions, reportedly.
In February 2009 it was
reported that subject is opening a "Honigman" store in Moscow,
Russia, further to 2 stores of TNT in Sibiria.
Reports in the media in the last several years on
subject:
During 2007
subject invested NIS 7 million in the upgrading of 7 branches and NIS 13
million in opening 18 new shops.
In December 2007,
it was reported on NIS 10 million investment in opening 8 new TNT shops
(concept stores, of 200-400 sq. meters each).
October 2009:
Opening “Honigman Men” shops in G-Mall in Kfar Saba and in Big Fashion Center
in Nazareth, part of the strategy of concept shops which combine women and men
department. Investment in the move - NIS 2.5 million. In December opened
further 2 “Honigman Men” shops in Afula and in Lev Hadera Mall, investment NIS 800,000.
January 2010: Openning a
new shop for “Honigman Men” brand in Hakeryon Mall, a shop on an area of 100
sq. meters, with investment NIS 500,000.
March 2011: TNT
launching a joint campaign (investment of NIS 500,000) with the international
brand 'Puma', for marketing designed snickers.
March 2012: new
advertising campaign with reported investment of NIS 3 million.
April 2012: an
advertizing campaign by TNT, investment of NIS 2 million.
In December 2010
it was reported that subject received the exclusive license to market in Israel
fashion accessories of the American pop star Justin Bieber.
In July 2012 it
was reported that subject is opening its first store attending the Arab sector
in the city of Sakhnin, with an investment of NIS 400,000.
According to a report from
August 2013, following the entrance of foreign children's fashion chains to
Israel, subject intends to lower its childeren's clothing prices by up to 40%,
that by cutting in the purchse field (including switching suppliers and moving
to new manufacturing countries such as Vietnam). According to the report,
subject's children's apparel sales are NIS 120 million (circa 35% of total
revenues), where the children's apparel local market is valued at NIS 1.5
billion.
In January 2014 it was
reported that subject intends to invest NIS 5 million in changing the concept of
its TNT line targing youth, which besides clothes will sell footwear of
ALLSTAR, VANS, KAPPA (as well as a private brand), accessories (CASIO, iDANCE),
and more. According to the report, TNT sales were NIS 110 million in 2013.
Reportedly, total revenues of the local
fashion market in 2013 reached NIS 12 billion per annum. In 2012 sales reached
NIS 11 billion. 40% of sales are in the large fashion chains, 34% in other
smaller chains, and the rest in private shops.
According
to the fashion market survey, which monitors sales by the local fashion chains,
2012 marked almost a freeze in revenues, with mere 0.7% increase from 2011. The
data reveals that in 2012 41 fashion chains (out of 72 chains with total of
over 1,600 shops) noted decrease in sales of aparel and footwear.
Based on surveys, around 50% and more is women's fashion.
Moreover, 40% of fashion stores in Israel belong to fashion chains, the rest
being private shops.
According to the
Central Bureau of Statistics (CBS), import of Clothing and Footwear in 2014
increased by 8.3% (in NIS terms, rose by 9.5% in $ terms), summing up to NIS
7,421.6 million. This comes after in 2013 import rose by mere 0.9% from 2012,
but rose by 13% in 2012.
Most import comes
from China. Main other countries of origin for textile goods are France, Italy,
Hong Kong and Turkey, Spain and the U.S.A.
The local fashion market has been significantly influenced
by the entrance of new international fashion players to the already highly
competitive local market.
To many players in the branch, the fierce competition,
coupled with the slow-down in local economy resulted in stagnation in sales and
drop in revenues. There have been also few collapses of veteran and big
retailers in some niches, including in the ladies fashion and children's
apparel.
Moreover, in particular for the recent period, local
businesses in general, and the fashion market in particular, sufferred a blow
from the fighting situation in Israel during July-August in the south of
Israel, causing freeze in sales.
From the CBS
preliminary National Accounts for 2014 on private consumption expenditure, it
turns that the current local households expenditure grew by 3.9% from 2013,
after rising by 3.3% in 2013 and by 3.2% in 2012.
Consumption
expenditure by households on Clothing and Footwear in 2014 rose by 10.1% from
2013 (after 2.2% rise in 2013 and by 8.5% in 2012).
In principle,
subject is veteran, well-known in their field, therefore suitable for trade engagements.
However, in view of subject's officials to update any data (unlike in the
past), we lack certain information that may assist in determining the company's
status (we do not have good idea as to the financial position). Also,
considering the fierce competition in the fashion branch, for the time being dealings are recommended on a fully secure basis.
Note: Since February
2013 Israel Post has started using a new area code method of 7 digits (the old
method of 5 digits is no longer valid).
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.61.50 |
|
|
1 |
Rs.92.16 |
|
Euro |
1 |
Rs.69.62 |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.