MIRA INFORM REPORT

 

 

Report No. :

328058

Report Date :

20.06.2015

 

IDENTIFICATION DETAILS

 

Name :

BASF PETRONAS CHEMICALS SDN. BHD.

 

 

Registered Office :

The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, Level 18, 59200 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2013

 

 

Date of Incorporation :

28.10.1997

 

 

Com. Reg. No.:

451307-K

 

 

Legal Form :

Private Limited (Limited By Share)

 

 

Line of Business :

Manufacturing of Chemical and Other Related Products

 

 

No. of Employee :

600

 

RATING & COMMENTS

 

MIRA’s Rating :

A

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

Status :

Good

Payment Behaviour :

Regular

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)

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 previously 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. Falling global oil prices in the second half of 2014 have strained government finances, shrunk Malaysia’s current account surplus and put downward pressure on the ringgit. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplied about 29% of government revenue in 2014. 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. Malaysia is a member of the 12-nation Trans-Pacific Partnership free trade agreement negotiations and, with the nine other ASEAN members, will form the ASEAN Economic Community in 2015.

 

Source : CIA

 

EXECUTIVE SUMMARY

 

 

REGISTRATION NO.

:

451307-K

COMPANY NAME

:

BASF PETRONAS CHEMICALS SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

28/10/1997

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED (LIMITED BY SHARE)

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

THE GARDENS NORTH TOWER, MID VALLEY CITY, LINGKARAN SYED PUTRA, LEVEL 18, 59200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

2, JALAN ASTAKA U8/87, BUKIT JELUTONG SEKSYEN U8, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

TEL.NO.

:

03-78412200

FAX.NO.

:

03-78466624

EMAIL

:

INFO.SERVICE@BASF-PETRONAS.COM.MY

WEB SITE

:

WWW.BASF-PETRONAS.COM.MY

CONTACT PERSON

:

SAZALI BIN HAMZAH ( DIRECTOR )

INDUSTRY CODE

:

20119

PRINCIPAL ACTIVITY

:

MANUFACTURING OF CHEMICAL AND OTHER RELATED PRODUCTS

AUTHORISED CAPITAL

:

MYR 2,400,000,000.00 DIVIDED INTO
ORDINARY SHARE 2,375,000.00 OF MYR 1,000.00 EACH.
PREFERENCE SHARE 25,000.00 OF MYR 1,000.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 1,019,420,000.00 DIVIDED INTO
ORDINARY SHARES 1,000,000 CASH OF MYR 1,000.00 EACH.
PREFERENCE SHARES 19,420 CASH OF MYR 1,000.00 EACH.

SALES

:

MYR 2,749,783,000 [2013]

NET WORTH

:

MYR 1,214,765,000 [2013]

M1000 OVERALL RANKING

:

199[2011]

M1000 INDUSTRY RANKING

:

8[2011]

BANKER (S)

MALAYAN BANKING BHD

STAFF STRENGTH

:

600 [2015]

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

STRONG

PAYMENT

:

PROMPT

MANAGEMENT CAPABILITY

:

GOOD

COMMERCIAL RISK

:

LOW

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

GOOD

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) manufacturing of chemical and other related products.

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

 

According to the Malaysia 1000 publication, the Subject's ranking are as follows:

 

 

YEAR

2011

2009

2008

2005

2004

OVERALL RANKING

199

114

109

179

278

INDUSTRY RANKING

8

3

4

3

6

 

The immediate holding company of the Subject is BASF NEDERLAND B.V., a company incorporated in NETHERLANDS.

The ultimate holding company of the Subject is BASF SE, a company incorporated in GERMANY.

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

22/01/2015

MYR 2,400,000,000.00

MYR 1,019,420,000.00

30/05/2013

MYR 2,400,000,000.00

MYR 1,000,000,000.00

06/12/1999

MYR 2,400,000,000.00

MYR 709,180,000.00

30/11/1999

MYR 2,400,000,000.00

MYR 700,000,000.00

14/07/1998

MYR 2,400,000,000.00

MYR 72,000,000.00

 

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

 

Name

Address

IC/PP/Loc No

Shareholding

(%)

BASF NEDERLAND B.V.

GRONINGENSINGEL 1, 6835 EA ARNHEM, THE NETHERLANDS, NETHERLANDS.

XLZ00215709

611,652.00

60.00

PETRONAS CHEMICALS GROUP BERHAD

TOWER 1, PETRONAS TWIN TOWERS, KUALA LUMPUR CITY CENTRE, 50088 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

459830K

407,768.00

40.00

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

------

1,019,420.00

100.00

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

=====

+ Also Director



DIRECTORS


DIRECTOR 1

 

Name Of Subject

:

DR TORSTEN PENKUHN

Address

:

34, DAKOTA CRESCENT, 19-01 DAKOTA, RESIDENCE, 399936, SINGAPORE.

IC / PP No

:

C4KH5HP60

Nationality

:

SINGAPOREAN

Date of Appointment

:

16/01/2012

 

DIRECTOR 2

 

Name Of Subject

:

MR. SAZALI BIN HAMZAH

Address

:

80, 9/4 JALAN SERI PUTRA, BANDAR SERI PUTRA, BANGI, 43000 KAJANG, SELANGOR, MALAYSIA.

IC / PP No

:

A0396634

New IC No

:

660501-01-5491

Date of Birth

:

01/05/1966

Nationality

:

MALAYSIAN

Date of Appointment

:

19/05/2014

 

DIRECTOR 3

 

Name Of Subject

:

PROFESSOR DR. RAINER DIERCKS

Address

:

PHILIPP-MELANCHTHON-STRABE 21, SPEYER, 67346, GERMANY.

IC / PP No

:

225206719

Nationality

:

GERMAN

Date of Appointment

:

24/02/2010

 

DIRECTOR 4

 

Name Of Subject

:

GOPALAN PILLAY

Address

:

FLAT A, 33/F, TOWER 2, 23 OLD PEAK ROAD, DYNASTY COURT, MID LEVELS, HONG KONG, HONG KONG.

IC / PP No

:

M00042411

Nationality

:

SOUTH AFRICAN

Date of Appointment

:

07/05/2013

 

DIRECTOR 5

 

Name Of Subject

:

DR.STEFAN FRANZ BECKMANN

Address

:

UNIT A-9-1, ONE MENERUNG, 1, JALAN MENERUNG, BANGSAR, 59100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

C8X06VM3C

Date of Appointment

:

01/03/2014

 

DIRECTOR 6

 

Name Of Subject

:

MR. WAN ZULKIFLEE BIN WAN ARIFFIN

Address

:

69, WESTERN GARDEN, 10450 PULAU PINANG, PULAU PINANG, MALAYSIA.

IC / PP No

:

5995503

New IC No

:

600819-07-5545

Date of Birth

:

19/08/1960

Nationality

:

MALAYSIAN

Date of Appointment

:

13/08/2010



MANAGEMENT

 

 

 

1)

Name of Subject

:

SAZALI BIN HAMZAH

Position

:

DIRECTOR

 

2)

Name of Subject

:

NORASHIKIN MOKHTAR

Position

:

SENIOR FINANCE MANAGER

 

3)

Name of Subject

:

SURAYA

Position

:

ASSISTANT HUMAN RESOURCES DIRECTOR

 

4)

Name of Subject

:

JASON CHOI KAM HENG

Position

:

MAINTENANCE MANAGER

 

 

 

AUDITOR

 

Auditor

:

KPMG DESA MEGAT & CO.

Auditor' Address

:

KPMG TOWER, 8 FIRST AVENUE, BANDAR UTAMA, 47800 PETALING JAYA, SELANGOR, MALAYSIA.

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. IZAM ISKANDAR BIN ISMAIL

IC / PP No

:

A2141565

New IC No

:

720409-13-5839

Address

:

117, JALAN 2, AMPANG JAYA, 68000 AMPANG, SELANGOR, MALAYSIA.

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

 

 

 

ENCUMBRANCE (S)


No encumbrance was found in our databank at the time of investigation.

 

LITIGATION CHECK AGAINST SUBJECT


* A check has been conducted in our databank againt 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

Percentage

:

80%

Overseas

:

YES

Percentage

:

20%

Import Countries

:

UNITED STATES


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

[

X

]

Good 31-60 Days

[

]

Average 61-90 Days

[

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

 

CLIENTELE

 

Local

:

YES

Percentage

:

60%

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Percentage

:

40%

Export Market

:

AUSTRALIA

INDIA

NEW ZEALAND

ASIA

Credit Term

:

30 - 60 DAYS

Payment Mode

:

CHEQUES
TELEGRAPHIC TRANSFER (TT)
LETTER OF CREDIT (LC)

Type of Customer

:

DEALERS,CHEMICAL INDUSTRY,DISTRIBUTORS

 

 

OPERATIONS

 

Products manufactured

:

CHEMICAL AND OTHER RELATED PRODUCTS

Member(s) / Affiliate(s)

:

FEDERATION OF MALAYSIAN MANUFACTURERS (FMM)

MALAYSIAN PLASTICS MANUFACTURERS ASSOCIATION (MPMA)

SMI ASSOCIATION OF MALAYSIA

SMALL & MEDIUM ENTERPRISE

MALAYSIAN INTERNATIONAL CHAMBER OF COMMERCE AND INDUSTRY (MICCI)

CHEMICAL INDUSTRIES COUNCIL OF MALAYSIA (CICM)

Ownership of premises

:

OWNED

 

Total Number of Employees:

 

YEAR

2015

2014

2013

2012

2011

GROUP

N/A

N/A

N/A

N/A

N/A

COMPANY

600

600

600

610

900

 

Branch

:

NO

 

Other Information:


The Subject is principally engaged in the (as a / as an) manufacturing of chemical and other related products.

The Subject is partners with BASF ASIA PACIFIC in Germany.

The Subject is a well-known name in the chemical industry and it produces and markets a wide range of essential chemical products.

The Subject owns a world-class integrated Chemical site in Gebeng, Pahang. It has an annual production output of approximately 1 million metric tonnes, which makes the site one of the largest integrated chemical sites in the Asia-Pacific region.

This 'verbund' (integrated) chemical production facility sited in Gebeng, Kuantan, Pahang Darul Makmur is the first such facility for BASF in the Asia Pacific, manufacturing acrylic, oxo-products and butanediol.

The Subject's plants can be categorised into:
1) Plant 1 - Acrylic O Complex
2) Plant 2 - OXO Complex
3) Plant 3 - BDO Complex

The Subject processes and refines petrochemical products and the end products are raw materials and ingredients for general purposes.

The Subject's product is Petrochemicals which is ethylene and propylene ( for plastic products),oxygenated, halogen-free are essential to the production of many pharmaceutical, paints and cosmetic products.

The end-products are among others plastics, adhesives, paints, lacquers, paper, diapers, automobile and industrial coatings, pharmaceuticals, fine chemicals, textiles, leather and personal care materials.

The Subject utilizes advanced automated and semi-automated machineries to ensure production of high quality products.

The Subject provides consistent high quality products to their customers. The Subject also strive to provide them with optimum solutions, be it in the area of planning, processing or distribution.

The Subject's close relationships with our internal partners, suppliers and service providers, enable them to coordinate activities and provide integrated logistic solutions tailor made to the customer’s needs.

The Subject deploy the following facilities to cater to the needs of their customers:

1. Marine command centre, providing safety vetting of all vessels.
2. Asia Pacific regional planner for bulk shipments.
3. Procurement of logistics solutions.
4. Providing customer service from enquiry stage until order completion.
5. Marine Insurance support and claims handling
6. Booking vessels according to customer requests.
7. Integration of customer supply chains.


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

03-78412200

Match

:

N/A

Address Provided by Client

:

2, JALAN ASTAKA U8/87, BUKIT JELUTONG SEKSYEN U8, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

Current Address

:

2, JALAN ASTAKA U8/87, BUKIT JELUTONG SEKSYEN U8, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

Match

:

YES

Latest Financial Accounts

:

YES

 

Other Investigations


On 9th April 2015, 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

:

Decreased

[

2009 - 2013

]

Return on Shareholder Funds

:

Acceptable

[

26.41%

]

Return on Net Assets

:

Favourable

[

37.16%

]

The continuous fall in turnover could be due to the lower demand for the Subject's products / services.The Subject's profit fell sharply because of the high operating costs incurred. The Subject's management had generated acceptable return for its shareholders using its assets.

Working Capital Control

Stock Ratio

:

Favourable

[

31 Days

]

Debtor Ratio

:

Favourable

[

32 Days

]

Creditors Ratio

:

Favourable

[

4 Days

]

The Subject's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. The favourable debtors' days could be due to the good credit control measures implemented by the Subject. 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

:

Favourable

[

2.74 Times

]

Current Ratio

:

Favourable

[

3.61 Times

]

A minimum liquid ratio of 1 should be maintained by the Subject in order to assure its creditors of its ability to meet short term obligations and the Subject was in a good liquidity position. Thus, we believe the Subject is able to meet all its short term obligations as and when they fall due.

Solvency

Interest Cover

:

Favourable

[

121.42 Times

]

Gearing Ratio

:

Favourable

[

0.00 Times

]

The interest cover showed that the Subject was able to service the interest. The favourable interest cover could indicate that the Subject was making enough profit to pay for the interest accrued. The Subject had no gearing and hence it had virtually no financial risk. The Subject was financed by its shareholders' funds and internally generated fund. During the economic downturn, the Subject, having a zero gearing, will be able to compete better than those which are highly geared in the same industry.

Overall Assessment :

The Subject's performance deteriorated over the years with lower turnover and profit. The Subject was in good liquidity position with its total current liabilities well covered by its total current assets. With its current net assets, the Subject should be able to repay its short term obligations. With the favourable interest cover, the Subject could be able to service all the accrued interest without facing any difficulties. The Subject was a zero gearing company, it was solely dependant on its shareholders to provide funds to finance its business. The Subject has good chance of getting loans, if the needs arises.

Overall financial condition of the Subject : STRONG

 

 

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

20119 : Manufacture of other basic chemicals n.e.c.

INDUSTRY :

MANUFACTURING

The manufacturing sector is expected to grow by 5.5% in 2015. It will be bolstered by strong domestic and export-oriented industries in line with growing investment activities and favorable external demand. Moreover, in 2014, the manufacturing sectors have spearheading growth. The manufacturing sector is estimated to grow at a faster pace in 2014 on higher exports of electronics and electrical (E&E) products as external demand improves.

The manufacturing sector expanded strongly during the first half of 2014, the highest growth in three years, spurred by higher global semiconductor sales. Value-added of the manufacturing sector expanded 7.1% during the first half of 2014. Production of the sector rose 6.6% in the first seven months of 2014 supported by resilient domestic demand and recovery in the external sector during the first seven months of the years. The sales value of manufactured products rebounded by 7.7% in the first seven months of 2014. The strong performance of the sector was on account of higher output at 9.4% from the domestic-oriented industries, particularly transport equipment, food and beverage.

The manufacturing sector continued to attract domestic and foreign investment with investment approved by Malaysian Investment Development Authority (MIDA) totaling RM47.4 billion during the first six months of 2014, mainly from Japan, China and Germany. Meanwhile, the capacity utilization rate remained steady at 80.4% during the second quarter of 2014 while average wage per employee and productivity improved to RM2,772 per month and 5.9%, respectively during the first seven months of 2014. Boosted by favorable domestic economic activity and recovery in the external sector, the manufacturing sector is expected to record a better performance with growth of 6.4% in 2014.

In the meantime, production of wood products rebounded by 5.1% largely supported by higher output in the saw-milling and planning of wood segment at 25.9% during the first seven months of 2014. The positive performance was attributed to vibrant residential and commercial construction activities which contributed to increased use of timber frame and glued laminated timber for cost savings compared to the use of concrete and steel. Increased demand from major export destination such as the US, Japan and Australia for Malaysian made furniture contributed to the higher output, particularly wooden and cane furniture which rebounded by 2.2%.

Production of rubber products contracted 0.3% in the first seven months of 2014 on account of slower demand for rubber gloves and rubber tyres. The decline in rubber tyres for vehicles was due to the weaker external demand from the automotive industry, particularly from China. Output of other rubber products contracted 3.8% following the product shift from rubber-based to plastics, silicones and metal alloys in the manufacture of medical devices.

Besides, exports of manufactured products are expected to grow 6.1% in 2014 boosted by the growing demand from advanced economies. However, during the first seven months of 2014, manufactured exports surged 11.4%. The robust growth was buoyed by strengthening demand in the US and EU, reflecting significant exposure of Malaysian exports to the economic performance in the advance economies. The strength in export was broad-based with robust growth in both E&E and non- E&E subsectors.

Under budget 2015, the Government will provide incentive in the form of capital allowance on automation expenditure to encourage automation in the manufacturing sector, which may help in the manufacturing sector.

OVERALL INDUSTRY OUTLOOK : Average Growth



CREDIT RISK EVALUATION & RECOMMENDATION

 

 


Incorporated in 1997, the Subject is a Private Limited company, focusing on manufacturing of chemical and other related products. With its long establishment in the market, the Subject has received strong support from its stable customers base. Its business position in the market is quite stable and it is expected to enjoy better market shares over its rivals. The Subject is a large entity with strong capital position of MYR 1,019,420,000. We are confident with the Subject's business and its future growth prospect. With a strong backing from its holding company, the Subject enjoys timely financial assistance should the needs arise.

Over the years, the Subject has established an extensive clientele base in the market. Besides catering to the local market, the Subject has penetrated into other countries. With the contribution of both local and overseas customers, the Subject is likely to be exposed to lower commercial risk. Hence, we believe that the Subject has better business expansion opportunities in the future. Being a large entity, the Subject has a steady workforce of 600 personnel to support its business operations. Its future prospects seem to be fairly good as its business operations are running relatively stable. The Subject has a good  management capability. Its capable management team has enabled the Subject to keep its business on going. Hence, the future prospect of the Subject is bright.

The Subject's business performance showed a reverse trend as both its turnover and pre-tax profit have decreased compared to the previous year. Based on the higher profitability, the Subject has generated a favourable return based on its existing shareholders' funds which indicated that the management was efficient in utilising its funds to generate income. The Subject is in good liquidity position with its current liabilities well covered by it current assets. Hence, it has sufficient working capital to meet its short term financial obligations. Being a zero geared company, the Subject virtually has no financial risk as it is mainly dependent on its internal funds to finance its business. Given a positive net worth standing at MYR 1,214,765,000, the Subject should be able to maintain its business in the near terms.

Without a strong assets backing, the Subject may face difficulties in getting loans for its future expansion and continued growth . 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.

We regard that the Subject's overall payment habit is prompt. The Subject had a favourable creditors' ratio as evidenced by its favourable collection days.

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 promptly.

 



PROFIT AND LOSS ACCOUNT

 

 

THE FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIAN FINANCIAL REPORTING STANDARDS(FRS)

BASF PETRONAS CHEMICALS SDN. BHD.

 

Financial Year End

2013-12-31

2012-12-31

2011-12-31

2010-12-31

2009-12-31

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

2,749,783,000

3,095,278,000

3,453,945,000

3,427,887,000

1,947,889,000

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

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

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

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

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

Total Turnover

2,749,783,000

3,095,278,000

3,453,945,000

3,427,887,000

1,947,889,000

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

449,513,000

804,062,000

1,196,972,000

1,294,401,000

237,782,000

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

449,513,000

804,062,000

1,196,972,000

1,294,401,000

237,782,000

Taxation

(128,724,000)

(176,085,000)

(196,161,000)

24,239,000

(2,621,000)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

320,789,000

627,977,000

1,000,811,000

1,318,640,000

235,161,000

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

395,304,000

417,327,000

666,516,000

361,876,000

114,250,000

Prior year adjustment

-

-

-

-

22,465,000

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

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

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

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

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

As restated

395,304,000

417,327,000

666,516,000

361,876,000

136,715,000

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

716,093,000

1,045,304,000

1,667,327,000

1,680,516,000

371,876,000

TRANSFER TO RESERVES - Statutory

-

-

-

-

(10,000,000)

TRANSFER TO RESERVES - General

-

-

-

(4,000,000)

-

DIVIDENDS - Ordinary (paid & proposed)

(315,000,000)

(650,000,000)

(1,250,000,000)

(1,010,000,000)

-

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

401,093,000

395,304,000

417,327,000

666,516,000

361,876,000

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Lease interest

3,732,000

3,380,000

2,947,000

-

-

Others

1,000

3,000

5,000

5,000

4,000

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

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

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

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

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

3,733,000

3,383,000

2,952,000

5,000

4,000

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

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

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

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

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

DEPRECIATION (as per notes to P&L)

133,987,000

129,638,000

142,507,000

227,738,000

266,647,000

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

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

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

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

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

133,987,000

129,638,000

142,507,000

227,738,000

266,647,000

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

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

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

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

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

 

 

 

BALANCE SHEET

 

 

BASF PETRONAS CHEMICALS SDN. BHD.

 

ASSETS EMPLOYED:

FIXED ASSETS

520,276,000

442,923,000

533,463,000

485,844,000

730,936,000

Deferred assets

8,500,000

20,258,000

32,612,000

26,254,000

-

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

8,500,000

20,258,000

32,612,000

26,254,000

-

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

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

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

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

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

TOTAL LONG TERM ASSETS

528,776,000

463,181,000

566,075,000

512,098,000

730,936,000

Stocks

231,374,000

211,972,000

180,323,000

166,595,000

132,345,000

Trade debtors

237,739,000

262,533,000

495,733,000

319,348,000

177,847,000

Other debtors, deposits & prepayments

9,450,000

4,906,000

7,121,000

10,672,000

11,745,000

Short term deposits

193,736,000

114,631,000

215,640,000

255,643,000

365,103,000

Amount due from related companies

278,526,000

289,909,000

2,971,000

397,421,000

216,504,000

Cash & bank balances

3,424,000

13,019,000

725,000

13,425,000

5,023,000

Others

914,000

274,000

-

13,000

8,264,000

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

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

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

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

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

TOTAL CURRENT ASSETS

955,163,000

897,244,000

902,513,000

1,163,117,000

916,831,000

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

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

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

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

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

TOTAL ASSET

1,483,939,000

1,360,425,000

1,468,588,000

1,675,215,000

1,647,767,000

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

27,177,000

11,945,000

114,936,000

23,415,000

7,144,000

Other creditors & accruals

77,364,000

77,085,000

63,740,000

83,173,000

57,447,000

Hire purchase & lease creditors

-

-

8,160,000

-

-

Amounts owing to holding company

15,295,000

6,483,000

2,488,000

3,794,000

-

Amounts owing to related companies

129,167,000

96,155,000

5,511,000

4,122,000

8,558,000

Provision for taxation

8,553,000

3,961,000

24,105,000

1,497,000

1,672,000

Lease payables

6,777,000

7,138,000

-

-

-

Other liabilities

-

6,682,000

21,310,000

153,949,000

117,587,000

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

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

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

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

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

TOTAL CURRENT LIABILITIES

264,333,000

209,449,000

240,250,000

269,950,000

192,408,000

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

690,830,000

687,795,000

662,263,000

893,167,000

724,423,000

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

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

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

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

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

TOTAL NET ASSETS

1,219,606,000

1,150,976,000

1,228,338,000

1,405,265,000

1,455,359,000

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

1,000,000,000

1,000,000,000

1,000,000,000

1,000,000,000

1,004,000,000

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

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

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

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

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

TOTAL SHARE CAPITAL

1,000,000,000

1,000,000,000

1,000,000,000

1,000,000,000

1,004,000,000

RESERVES

Share premium

-

-

-

-

196,000,000

Exchange equalisation/fluctuation reserve

(200,328,000)

(269,920,000)

(221,114,000)

(275,251,000)

(116,517,000)

Retained profit/(loss) carried forward

401,093,000

395,304,000

417,327,000

666,516,000

361,876,000

Capital redemption reserve

14,000,000

14,000,000

14,000,000

14,000,000

10,000,000

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

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

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

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

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

TOTAL RESERVES

214,765,000

139,384,000

210,213,000

405,265,000

451,359,000

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

1,214,765,000

1,139,384,000

1,210,213,000

1,405,265,000

1,455,359,000

Lease obligations

4,841,000

11,592,000

18,125,000

-

-

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

4,841,000

11,592,000

18,125,000

-

-

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

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

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

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

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

1,219,606,000

1,150,976,000

1,228,338,000

1,405,265,000

1,455,359,000

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

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

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

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

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

 

 

 

 

FINANCIAL RATIO

 

 

BASF PETRONAS CHEMICALS SDN. BHD.

 

TYPES OF FUNDS

Cash

197,160,000

127,650,000

216,365,000

269,068,000

370,126,000

Net Liquid Funds

197,160,000

127,650,000

216,365,000

269,068,000

370,126,000

Net Liquid Assets

459,456,000

475,823,000

481,940,000

726,572,000

592,078,000

Net Current Assets/(Liabilities)

690,830,000

687,795,000

662,263,000

893,167,000

724,423,000

Net Tangible Assets

1,219,606,000

1,150,976,000

1,228,338,000

1,405,265,000

1,455,359,000

Net Monetary Assets

454,615,000

464,231,000

463,815,000

726,572,000

592,078,000

PROFIT & LOSS ITEMS

Earnings Before Interest & Tax (EBIT)

453,246,000

807,445,000

1,199,924,000

1,294,406,000

237,786,000

Earnings Before Interest, Taxes, Depreciation And Amortization (EBITDA)

587,233,000

937,083,000

1,342,431,000

1,522,144,000

504,433,000

BALANCE SHEET ITEMS

Total Borrowings

4,841,000

11,592,000

26,285,000

0

0

Total Liabilities

269,174,000

221,041,000

258,375,000

269,950,000

192,408,000

Total Assets

1,483,939,000

1,360,425,000

1,468,588,000

1,675,215,000

1,647,767,000

Net Assets

1,219,606,000

1,150,976,000

1,228,338,000

1,405,265,000

1,455,359,000

Net Assets Backing

1,214,765,000

1,139,384,000

1,210,213,000

1,405,265,000

1,455,359,000

Shareholders' Funds

1,214,765,000

1,139,384,000

1,210,213,000

1,405,265,000

1,455,359,000

Total Share Capital

1,000,000,000

1,000,000,000

1,000,000,000

1,000,000,000

1,004,000,000

Total Reserves

214,765,000

139,384,000

210,213,000

405,265,000

451,359,000

LIQUIDITY (Times)

Cash Ratio

0.75

0.61

0.90

1.00

1.92

Liquid Ratio

2.74

3.27

3.01

3.69

4.08

Current Ratio

3.61

4.28

3.76

4.31

4.77

WORKING CAPITAL CONTROL (Days)

Stock Ratio

31

25

19

18

25

Debtors Ratio

32

31

52

34

33

Creditors Ratio

4

1

12

2

1

SOLVENCY RATIOS (Times)

Gearing Ratio

0.00

0.01

0.02

0.00

0.00

Liabilities Ratio

0.22

0.19

0.21

0.19

0.13

Times Interest Earned Ratio

121.42

238.68

406.48

258,881.20

59,446.50

Assets Backing Ratio

1.22

1.15

1.23

1.41

1.45

PERFORMANCE RATIO (%)

Operating Profit Margin

16.35

25.98

34.66

37.76

12.21

Net Profit Margin

11.67

20.29

28.98

38.47

12.07

Return On Net Assets

37.16

70.15

97.69

92.11

16.34

Return On Capital Employed

37.16

70.15

97.04

92.11

16.34

Return On Shareholders' Funds/Equity

26.41

55.12

82.70

93.84

16.16

Dividend Pay Out Ratio (Times)

0.98

1.04

1.25

0.77

0.00

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

0

0

 

 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.63.82

UK Pound

1

Rs.101.26

Euro

1

Rs.72.36

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

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%)

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.