MIRA INFORM REPORT

Report No. :	329724
Report Date :	04.07.2015

IDENTIFICATION DETAILS

Name :	FLOKCAN TEKSTIL SANAYI VE TICARET LTD. STI.
Registered Office :	Barakfakih Sanayi Bolgesi No:60 Kestel Merkez Bursa
Country :	Turkey
Financials (as on) :	31.12.2013
Date of Incorporation :	2002
Com. Reg. No.:	51874
Legal Form :	Limited Company
Line of Business :	Manufacture and Trade of Flock.
No. of Employees :	45

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 – March 31, 2015

Country Name	Previous Rating (31.12.2014)	Current Rating (31.03.2015)
Turkey	B1	B1

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

TURKEY - ECONOMIC OVERVIEW

Turkey's largely free-market economy is increasingly driven by its industry and service sectors, although its traditional agriculture sector still accounts for about 25% of employment. An aggressive privatization program has reduced state involvement in basic industry, banking, transport, and communication, and an emerging cadre of middle-class entrepreneurs is adding dynamism to the economy and expanding production beyond the traditional textiles and clothing sectors. The automotive, construction, and electronics industries are rising in importance and have surpassed textiles within Turkey's export mix. Oil began to flow through the Baku-Tbilisi-Ceyhan pipeline in May 2006, marking a major milestone that will bring up to 1 million barrels per day from the Caspian region to market. Several gas pipeline projects also are moving forward to help transport Caspian gas to Europe through Turkey, which over the long term will help address Turkey's dependence on imported oil and gas, which currently meets 97% of its energy needs. After Turkey experienced a severe financial crisis in 2001, Ankara adopted financial and fiscal reforms as part of an IMF program. The reforms strengthened the country's economic fundamentals and ushered in an era of strong growth averaging more than 6% annually until 2008. Global economic conditions and tighter fiscal policy caused GDP to contract in 2009, but Turkey's well-regulated financial markets and banking system helped the country weather the global financial crisis, and GDP rebounded strongly to around 9% in 2010-11, as exports returned to normal levels following the recession. Two rating agencies upgraded Turkey's debt to investment grade in 2012 and 2013, and Turkey's public sector debt to GDP ratio fell to 33% in 2014. The stock value of FDI reached nearly $195 billion at year-end 2014. Despite these positive trends, GDP growth dropped to 4.4% in 2013 and 2.9% in 2014. Growth slowed considerably in the last quarter of 2014, largely due to lackluster consumer demand both domestically and in Europe, Turkey’s most important export market. High interest rates have also contributed to the slowdown in growth, as Turkey sharply increased interest rates in January 2014 in order to strengthen the country’s currency and reduce inflation. Turkey then cut rates in February 2015 in a bid to spur economic growth. It is clear from these developments that the Turkish economy retains significant weaknesses. Specifically, Turkey's relatively high current account deficit, domestic political uncertainty, and turmoil within Turkey's neighborhood leave the economy vulnerable to destabilizing shifts in investor confidence. Turkey also remains dependent on often volatile, short-term investment to finance its large current account deficit.

Source : CIA

COMPANY IDENTIFICATION

NAME	:	FLOKCAN TEKSTIL SANAYI VE TICARET LTD. STI.
HEAD OFFICE ADDRESS	:	Barakfakih Sanayi Bolgesi No:60 Kestel Merkez Bursa / Turkey
PHONE NUMBER	:	90-224-384 10 44
FAX NUMBER	:	90-224-384 10 47
WEB-ADDRESS	:	www.flokcan.com.tr
E-MAIL	:	flokcan@flokcan.com.tr

LEGAL STATUS AND HISTORY

TAX OFFICE	:	Ertugrulgazi
TAX NO	:	3880323862
REGISTRATION NUMBER	:	51874
REGISTERED OFFICE	:	Bursa Chamber of Commerce and Industry
DATE ESTABLISHED	:	2002
ESTABLISHMENT GAZETTE DATE/NO	:	13.03.2002/5504
LEGAL FORM	:	Limited Company
TYPE OF COMPANY	:	Private
REGISTERED CAPITAL	:	TL 1.500.000
PAID-IN CAPITAL	:	TL 1.500.000

OWNERSHIP / MANAGEMENT

SHAREHOLDERS

:

Tahsin Caner	98 %
Hanife Caner	2 %

DIRECTORS

:

Tahsin Caner

OPERATIONS

BUSINESS ACTIVITIES

:

Manufacture and trade of flock.

NACE CODE

:

DB.17.10

NUMBER OF EMPLOYEES

:

45

NET SALES

:

9.564 TL Thousand	(2012)
11.422 TL Thousand	(2013)
6.289 TL Thousand	(01.01-30.06.2014)

IMPORT COUNTRIES

:

Italy

France

Switzerland

MERCHANDISE IMPORTED

:

Raw materials

EXPORT VALUE

:

4.292 TL Thousand	(2012)
4.005 TL Thousand	(2013)
2.977 TL Thousand	(01.01-30.06.2014)

EXPORT COUNTRIES

:

Germany

U.K.

France

MERCHANDISE EXPORTED

:

Flock powder

HEAD OFFICE ADDRESS

:

Barakfakih Sanayi Bolgesi No:60 Kestel Merkez Bursa / Turkey

BRANCHES

:

Head Office/Production Plant : Barakfakih Sanayi Bolgesi No:60 Kestel Merkez Bursa/Turkey

TREND OF BUSINESS	:	There was an upwards trend in 2013. There appears an upwards trend in 1.1 - 30.6.2014.
SIZE OF BUSINESS	:	Large

FINANCE

MAIN DEALING BANKS

:

Garanti Bankasi Kestel Branch

Yapi ve Kredi Bankasi Kestel Branch

CREDIT FACILITIES

:

The subject company is making use of credit facilities.

PAYMENT BEHAVIOUR

:

No payment delays have come to our knowledge.

KEY FINANCIAL ELEMENTS

:

	(2013) TL Thousand	(01.01-30.06.2014) TL Thousand
Net Sales	11.422	6.289
Profit (Loss) Before Tax	2.090	1.189
Stockholders' Equity	9.859
Total Assets	11.440
Current Assets	7.827
Non-Current Assets	3.613
Current Liabilities	682
Long-Term Liabilities	899
Gross Profit (loss)	2.680	1.577
Operating Profit (loss)	1.944	1.207
Net Profit (loss)	1.669	1.189

COMMENT ON FINANCIAL POSITION

Capitalization	High As of 31.12.2013
Liquidity	High As of 31.12.2013
Remarks On Liquidity	The unfavorable gap between average collection and average payable period has an adverse effect on liquidity.
Profitability	High Operating Profitability in 2013 High Net Profitability in 2013 High Operating Profitability (01.01-30.06.2014) High Net Profitability (01.01-30.06.2014)
Gap between average collection and payable periods	Unfavorable in 2013
General Financial Position	Good
Remarks on General Financial Position	Recent financial figures are not available the firm declines to provide fresh financial data.

	Incr. in producers’ price index	Average USD/TL	Average EUR/TL	Average GBP/ TL
( 2012 )	2,45 %	1,7995	2,3265	2,8593
( 2013 )	6,97 %	1,9179	2,5530	3,0178
( 01.01-30.06.2014)	5,12 %	2,1608	2,9618	3,6153
( 2014 )	6,36 %	2,1891	2,8989	3,6060
( 01.01-31.05.2015)	5,22 %	2,5346	2,8509	3,8736

BALANCE SHEETS
	( 31.12.2013 ) TL Thousand
CURRENT ASSETS	7.827	0,68
Not Detailed Current Assets	0	0,00
Cash and Banks	684	0,06
Marketable Securities	0	0,00
Account Receivable	2.855	0,25
Other Receivable	56	0,00
Inventories	3.227	0,28
Advances Given	199	0,02
Accumulated Construction Expense	0	0,00
Other Current Assets	806	0,07
NON-CURRENT ASSETS	3.613	0,32
Not Detailed Non-Current Assets	0	0,00
Long-term Receivable	15	0,00
Financial Assets	0	0,00
Tangible Fixed Assets (net)	3.208	0,28
Intangible Assets	389	0,03
Deferred Tax Assets	0	0,00
Other Non-Current Assets	1	0,00
TOTAL ASSETS	11.440	1,00
CURRENT LIABILITIES	682	0,06
Not Detailed Current Liabilities	0	0,00
Financial Loans	21	0,00
Accounts Payable	93	0,01
Loans from Shareholders	164	0,01
Other Short-term Payable	88	0,01
Advances from Customers	125	0,01
Accumulated Construction Income	0	0,00
Taxes Payable	165	0,01
Provisions	26	0,00
Other Current Liabilities	0	0,00
LONG-TERM LIABILITIES	899	0,08
Not Detailed Long-term Liabilities	0	0,00
Financial Loans	899	0,08
Securities Issued	0	0,00
Long-term Payable	0	0,00
Loans from Shareholders	0	0,00
Other Long-term Liabilities	0	0,00
Provisions	0	0,00
STOCKHOLDERS' EQUITY	9.859	0,86
Not Detailed Stockholders' Equity	9.859	0,86
Paid-in Capital	0	0,00
Cross Shareholding Adjustment of Capital	0	0,00
Inflation Adjustment of Capital	0	0,00
Equity of Consolidated Firms	0	0,00
Reserves	0	0,00
Revaluation Fund	0	0,00
Accumulated Losses(-)	0	0,00
Net Profit (loss)	0	0,00
TOTAL LIABILITIES AND EQUITY	11.440	1,00

REMARKS ON FINANCIAL STATEMENT

:

At the financial statements according to TAS, "Cheques Received" and "Outstanding Cheques" figures are under "Cash And Banks" figure. Beginning from the financial statements of 31.12.2011, "Cheques Received" and "Outstanding Cheques" figures are given under "Account Receivable" figure and "Account Payable" figure respectively. In the sub-items of "Account Receivable", TL thousand 11 is "Doubtful Trade Receivables" and -TL thousand 11 is "Provision for Doubtful Trade Receivables" at the last balance sheet. The details of "Other Receivable" figure at the last balance sheet (TL Thousand): Due From Shareholders: 0, Due From Participations: 0, Due From Affiliated Companies: 0, Due From Personnel: 4, Other Miscellaneous Receivables: 52, Other Receivable Total: 56. TL thousand 0 of "Tax Payable" is due to "Overdue, Delayed or Deferred Tax by Installments and Other Liabilities" at the last balance sheet.

INCOME STATEMENTS
	(2013) TL Thousand		(01.01-30.06.2014) TL Thousand
Net Sales	11.422	1,00	6.289	1,00
Cost of Goods Sold	8.742	0,77	4.712	0,75
Gross Profit	2.680	0,23	1.577	0,25
Operating Expenses	736	0,06	370	0,06
Operating Profit	1.944	0,17	1.207	0,19
Other Income	384	0,03	241	0,04
Other Expenses	128	0,01	253	0,04
Financial Expenses	110	0,01	6	0,00
Minority Interests	0	0,00	0	0,00
Profit (loss) of consolidated firms	0	0,00	0	0,00
Profit (loss) Before Tax	2.090	0,18	1.189	0,19
Tax Payable	421	0,04	0	0,00
Postponed Tax Gain	0	0,00	0	0,00
Net Profit (loss)	1.669	0,15	1.189	0,19

FINANCIAL RATIOS
	(2013)
LIQUIDITY RATIOS
Current Ratio	11,48
Acid-Test Ratio	5,27
Cash Ratio	1,00
ASSET STRUCTURE RATIOS
Inventory/Total Assets	0,28
Short-term Receivable/Total Assets	0,25
Tangible Assets/Total Assets	0,28
TURNOVER RATIOS
Inventory Turnover	2,71
Stockholders' Equity Turnover	1,16
Asset Turnover	1,00
FINANCIAL STRUCTURE
Stockholders' Equity/Total Assets	0,86
Current Liabilities/Total Assets	0,06
Financial Leverage	0,14
Gearing Percentage	0,16
PROFITABILITY RATIOS
Net Profit/Stockholders' Eq.	0,17
Operating Profit Margin	0,17
Net Profit Margin	0,15
Interest Cover	20,00
COLLECTION-PAYMENT
Average Collection Period (days)	90,46
Average Payable Period (days)	3,83
WORKING CAPITAL	7145,00

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.63.40
UK Pound	1	Rs.98.94
Euro	1	Rs.70.33

INFORMATION DETAILS

Analysis Done by :	KAR
Report Prepared by :	TPT

RATING EXPLANATIONS

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

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

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

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

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