MIRA INFORM REPORT

Report No. :	332633
Report Date :	24.07.2015

IDENTIFICATION DETAILS

Name :	LABORMED-PHARMA SA
Registered Office :	Bucharest, Theodor Pallady Blvd. No. 44B, Sector 3
Country :	Romania
Financials (as on) :	31.12.2014
Date of Incorporation :	November 2007
Legal Form :	Private joint stock company
Line of Business :	Subject manufacture of pharmaceutical preparations
No. of Employee :	242 (30.06.2014)

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 :	Slow but correct
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)
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. 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. In the aftermath of the global financial crisis, Romania signed on to a $26 billion emergency assistance package from the IMF, the EU, and other international lenders, but GDP contracted until 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, Romanian authorities and the IMF/EU agreed to a follow-on precautionary two-year stand-by agreement, worth $5.4 billion, to continue with reforms, although Bucharest has announced that it does not intend to draw funds under the agreement. Economic growth rebounded in 2013, driven by strong industrial exports and an excellent agricultural harvest, and the current account deficit was reduced substantially. The economy closed out 2014 with 2.8% growth, down from the 3.5% posted in 2013. Industry outperformed other sectors of the economy. Exports remained the engine of economic growth, led by trade with the EU, which accounts for roughly 70% of Romania trade. In 2014, the Government of Romania succeeded in meeting its annual target for the budget deficit, the external deficit remained low, and inflation was the lowest since 1989, allowing a gradual loosening of the monetary policy throughout the year. However, progress on structural reforms has been uneven and the economy still is vulnerable to external shocks. An ageing population, weak domestic demand, tax evasion, and insufficient health-care represent top vulnerabilities.

Source : CIA

COMPANY name and address

LABORMED-PHARMA SA

Address

Bucharest, Theodor Pallady Blvd. No. 44B, Sector 3

Phone no.

Cell phone no.

0040-21-3180377

0040-750-111800

Fax no.

0040-21-3180376

Web-site

www.alvogen.ro

E-mail address

info.romania@alvogen.com

relatii.clienti@labormed.eu

HISTORIC/OFFICIAL DATA

Date of foundation

November, 2007

Present legal form

Private joint stock company, joint venture of Romanian and Dutch capital

Registered with the Trade Registry

J40/21114/2007

VAT no.

22718452

Registered capital

Declared by the subject in the last financial statements available as for June 2014

- 368,217,000 RON

Latest officially declared with the National Trade Registry

- 610,965,000 RON

Shareholders

Individual

1. Scheusan Corneliu-Laurentiu - Romanian citizen, born on 1.10.1967

Participation

0.0002%

Legal person

2. Eurogenerics Holdings BV – Dutch legal person

Address: Netherland, 1097 JB, Amsteram, 200 Prins Bernhardplein

Participation

60.2679%

3. Alvogen Lux Holdings SARL – legal person from Luxembourg

Address: Luxembourg, Luxembourg, Senningerberg L – 1736, Rue Heienhaff 5

Participation

39.7319%

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

2010

2011

2012

2013

30.06.2014

total

291

295

227

235

242

BUSINESS ACTIVITY

Officially registered with the National Trade Registry updated files and confirmed by the company’s web site

- manufacture of pharmaceutical preparations (NACE – 2120)

Company is part and center of excellence in Central and Eastern Europe of the international group ALVOGEN since 2010.

Work-shops, declared on its web site:

Iasi county, Iasi, 10 Sos. Petru Poni

Galati county, Galati, 164 Traian Street, Bl. A12, Parter

Brasov county, Brasov, 28 Baba Novac Street

Cluj county, Cluj-Napoca, Str. Constantin Brâncuși nr. 100

Dolj county, Craiova, Calea Severinului No. 48C

OTHER PARTICIPATION

1. Company’s participation

LABORMED PHARMA TRADING SRL – Reg. no.: J40/2501/2000, VAT 12826074

2. Shareholders other participation

Scheusan Corneliu-Laurentiu

ALVOGEN ROMANIA SRL
J23/2017/2008
24114290

Eurogenerics Holdings BV

Not applicable

Alvogen Lux Holdings SARL

Not applicable

REAL ESTATE (RON)

- lands & buildings

2010

2011

2012

2013

2014

n/a

n/a

26,187,438

25,571,740

25,048,668

BANKS

ROMANIAN BANK FOR DEVELOPMENT – GROUPE SOCIETE GENERALE

MANAGEMENT

· as officially registered with the National Trade Registry

· according to the company’s web-site

PRESIDENT

Scheusan Corneliu Laurentiu – Romanian citizen, born on 1.10.1967

Appointed on 19.12.2012, Expiration date of mandate: 19.12.2016

MEMBERS & ADMINISTRATORS

Hardarson Arni – Icelandic citizen, born on 5.08.1966

Appointed on 19.12.2012, Expiration date of mandate 19.12.2016

Florica Mirel - Romanian citizen, born on 10.09.196

Appointed on 27.06.2014, Expiration date of mandate: 27.06.2018

Laurentiu Scheusan – Chief Executive Officer

Viorica Preduna – Chief Commercial Officer

Mirel Florica – Chief Operation Officer

Dan Modrogan – Chief Financial Officer

CURRENCY

Exchange rate of EURO

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 = 4.4821 RON on 31.12.2014

FINANCIAL DATA: RON

BALANCE SHEET	31.12.2011	31.12.2012	31.12.2013	31.12.2014
INTANGIBLES - TOTAL	n/a	80,564,493	98,620,479	93,752,123
TANGIBLES - TOTAL	n/a	42,347,879	36,726,681	35,837,045
FINANCIALS - TOTAL	n/a	107,512,809	36,873,380	50,133,000
FIXED ASSETS - TOTAL	270,146,749	230,425,181	172,220,540	179,722,168
STOCKS - TOTAL	13,032,608	16,444,238	19,369,774	20,410,006
CLAIMS - TOTAL	203,251,488	176,915,705	177,024,501	125,647,087
CURRENT ASSETS	216,654,062	195,519,044	197,958,271	152,795,911
PREPAID EXPENSES	8,484,306	4,810,422	1,179,451	1,141,401
DEBTS WITHIN 1 YEAR	n/a	385,242,952	43,516,247	56,083,423
DEBTS OVER 1 YEAR	n/a	0	382,495,024	109,383,979
TOTAL DEBTS	367,113,680	385,242,952	426,011,271	165,467,402
PROVISIONS	21,821,249	50,322,006	51,645,413	51,872,939
ADVANCED INCOMES	121	0	0	0
REGISTERED CAPITAL	368,217,000	368,217,000	368,217,000	610,965,000
RESERVES from reassessment of the fixed assets	n/a	15,971,744	12,582,577	11,667,944
RESERVES	n/a	25,575,217	29,241,696	30,156,628
LOSSES CARRIED FORWARD	n/a	301,551,986	498,370,795	516,340,356
NET RESULT - PROFIT	0	0	0	0
NET RESULT - LOSS	192,915,618	113,022,646	17,969,560	20,130,437
NET WORTH	106,350,067	-4,810,311	-106,298,422	116,319,139
PROFIT & LOSS ACCOUNT	31.12.2011	31.12.2012	31.12.2013	31.12.2014
Turnover	116,515,549	88,241,949	141,782,355	136,686,016
Own production & services	n/a	121,523,328	n/a	n/a
Sales	n/a	10,289,739	n/a	n/a
INCOMES FROM ORDINARY OPERATING ACTIVITY	n/a	90,235,824	137,612,019	134,529,637
Raw materials	n/a	29,962,417	133,319,775	n/a
Costs of goods sold	n/a	3,761,239	n/a	n/a
Wages	n/a	18,098,697	n/a	n/a
Depreciations & provisions	n/a	44,752,457	n/a	n/a
Other operating costs	n/a	47,586,780	n/a	n/a
COSTS OF ORDINARY OPERATING ACTIVITY	n/a	173,151,850	133,319,775	148,326,776
ORDINARY OPERATING RESULT - PROFIT	n/a	0	4,292,244	0
ORDINARY OPERATING RESULT - LOSS	n/a	82,916,026	0	13,797,139
FINANCIAL INCOMES	n/a	20,198,636	26,286,094	7,067,603
FINANCIAL COSTS	n/a	50,305,256	48,547,898	13,400,901
FINANCIAL RESULT - PROFIT	n/a	0	0	0
FINANCIAL RESULT - LOSS	n/a	30,106,620	22,261,804	6,333,298
CURRENT RESULT - PROFIT	n/a	0	0	0
CURRENT RESULT - LOSS	n/a	113,022,646	17,969,560	20,130,437
Extraordinary incomes	n/a	0	0	0
Extraordinary costs	n/a	0	0	0
EXTRAORDINARY RESULT - PROFIT	n/a	0	0	0
EXTRAORDINARY RESULT - LOSS	n/a	0	0	0
TOTAL INCOMES	146,035,209	110,434,460	163,898,113	141,597,240
TOTAL COSTS	338,950,827	223,457,106	181,867,673	161,727,677
PRETAX RESULT - PROFIT	0	0	0	0
PRETAX RESULT - LOSS	192,915,618	113,022,646	17,969,560	20,130,437
TAX ON PROFIT	0	0	0	0
NET RESULT - PROFIT	0	0	0	0
NET RESULT - LOSS	192,915,618	113,022,646	17,969,560	20,130,437

OUR OPINION

based upon financial figures reported in the latest balance-sheet – 31.12.2014

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

Size

medium, considering the number of employees

Position & trend

Fluctuant, but always large volume of activity. Even so, company registered negative results for the entire analyzed period. Also, important uncovered losses from the previous periods are registered.

Liquidity is still insufficient to meet the payments within agreed terms and solvability is in bad condition due to the negative net worth.

There were registered delays in payments, representing 42% from all suppliers.

Financial standing looks generally unsatisfactory.

Business trend has to be closely followed.

31.12.2010

31.12.2011

31.12.2012

31.12.2013

31.12.2014

Turnover

RON

129,744,772

116,515,549

88,241,949

141,782,355

136,686,016

EURO

30,280,240

26,973,065

19,925,023

31,614,680

30,495,976

Gross profit

RON

-39,445,436

-192,915,618

-113,022,646

-17,969,560

-20,130,437

EURO

-9,205,899

-44,659,494

-25,520,502

-4,006,859

-4,491,296

Net profit

RON

-39,445,436

-192,915,618

-113,022,646

-17,969,560

-20,130,437

EURO

-9,205,899

-44,659,494

-25,520,502

-4,006,859

-4,491,296

31.12.2014

CREDITS & LOANS (ACTIVE BALANCE)

N/A

BALANCE CLAIMS-DEBTS

Negative

Total claims, no further details available

125,647,087

Total debts

165,467,402

- Short term, no further details available

56,083,423

- Medium term, no further details available

109,383,979

PAYMENTS BEHAVIOR

With delays

Total overdue of 7% of turnover (16% of total short term debt)

9,092,385

To suppliers (42% of all)

9,092,385

over 30 days

448,783

over 90 days

19,336

over 1 year

8,624,266

PAYMENTS INCIDENTS

as

officially recorded with the Payment Incident Bureau

No incidents registered during 22.07.2014 – 22.07.2015

BLACKLISTING (international sanctions)

Not applicable

2009

2010

2011

2012

2013

2014

Still insufficient to meet the payments within agreed terms

Liquidity analysis

- current ratio

2.90

0.58

0.59

0.51

4.55

2.72

- quick ratio

2.63

0.53

0.55

0.46

4.10

2.36

Solvability analysis

In bad conditions due to the negative net worth

- the borrowing ratio (total debts/net worth)

1.57

1.48

3.45

-80.09

-4.01

-1.42

Profitability analysis (%)

Consecutive losses

Activity analysis

Within normal limits for its line of business

- debtor’s days

376

496

637

732

456

336

- creditor’s days

59

n/a

n/a

85

51

58

Stocks turnover, times/year

9

7

9

5

7

7

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.63.71
UK Pound	1	Rs.99.57
Euro	1	Rs.69.63

INFORMATION DETAILS

Analysis Done by :	RAS
Report Prepared by :	ASH

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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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.