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3decades

 

MIRA INFORM REPORT

 

 

Report No. :

503139

Report Date :

13.04.2018

 

 

IDENTIFICATION DETAILS

 

Name :

AL AYAM PUBLICATION ESTABLISHMENT BSC (C)

 

 

Registered Office :

Al Ayam Building, Block No. 577, Road No. 7735, Road No. 7735, Al Janubia, PO Box, 3232

 

 

Country :

Bahrain

 

 

Financials (as on) :

31.12.2017

 

 

Date of Incorporation :

08.02.1989

 

 

Com. Reg. No.:

20555-1, Manama

 

 

Legal Form :

Bahraini Shareholding Company Closed BSC (C)

 

 

Line of Business :

Subject Engaged in the printing and publishing of newspapers and books. Subject prints the “Al Ayam”, “Al Methaq” and “Bahrain Tribune” daily newspapers

 

 

No. of Employees :

400

 

 

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23rd January 2017)

 

MIRA’s Rating :

A

 

Credit Rating

Explanation

Rating Comments

A

Acceptable Risk

Business dealings permissible with moderate risk of default

 

Status :

Good

 

 

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

 

Country Name

Previous Rating

(30.09.2017)

Current Rating

(31.12.2017)

Bahrain

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low Risk

 

A2

Moderately Low Risk

 

B1

Moderate Risk

 

B2

Moderately High Risk

 

C1

High Risk

 

C2

Very High Risk

 

D

 

 

BAHRAIN - ECONOMIC OVERVIEW

 

Low oil prices have generated a budget deficit of at least a $4 billion deficit in 2016, nearly 14% of GDP. Bahrain has few options for covering this deficit, with meager foreign assets and fewer oil resources compared to its GCC neighbors. In 2016 the three major US credit agencies downgraded Bahrain’s sovereign debt rating to “junk” status, citing persistently low oil prices and the government’s inability to more effectively cut spending. Nevertheless, Bahrain in 2017 was able to raise about $3 billion by issuing international debt.

Oil comprises 86% of Bahraini budget revenues, despite past efforts to diversify its economy and to build communication and transport facilities for multinational firms with business in the Gulf. As part of its diversification plans, Bahrain implemented a Free Trade Agreement (FTA) with the US in August 2006, the first FTA between the US and a Gulf state.

Other major economic activities are production of aluminum - Bahrain's second biggest export after oil - finance, and construction. Bahrain continues to seek new natural gas supplies as feedstock to support its expanding petrochemical and aluminum industries.

In 2011, Bahrain experienced economic setbacks as a result of domestic unrest driven by the majority Shia population; however, the economy recovered in 2012-15, partly as a result of improved tourism. In addition to addressing its current fiscal woes, Bahraini authorities face the long-term challenge of boosting Bahrain’s regional competitiveness — especially regarding industry, finance, and tourism — and reconciling revenue constraints with popular pressure to maintain generous state subsidies and a large public sector. Since 2015, the government lifted subsidies on meat, diesel, kerosene, and gasoline and announced new higher prices for electricity and water, although it plans to roll these increases out more gradually than previous subsidy cuts.

 

Source : CIA

 

SUMMARY

 

Company Name                                    : AL AYAM PUBLICATION ESTABLISHMENT BSC (C)

Country of Origin                                   : Bahrain

Legal Form                                           : Bahraini Shareholding Company Closed BSC (C)

Registration Date                                  : 8th February 1989

Commercial Registration Number           : 20555-1

Chamber Membership Number               : 1968

Issued Capital                                       : BD 2,000,000

Paid up Capital                                     : BD 2,000,000

Total Workforce                                    : 400

Activities                                               : Printers and publishers of newspapers and books

Financial Condition                                : Fair

Payments                                             : No Complaints

Operating Trend                                    : Steady

 

 

 

COMPANY NAME

 

 AL AYAM PUBLICATION ESTABLISHMENT BSC (C)

 

 

ADDRESS

 

Registered & Physical Address

 

Building            : Al Ayam Building, Block No. 577

Street               : Road No. 7735

Area                 : Al Janubia

 

PO Box            : 3232

 

Town                : Manama

Country             : Bahrain

 

Telephone         : (973-17) 727111 / 725111 / 727001

Facsimile          : (973-17) 723300 / 723763 / 729550 / 729009

Email                : alayam@batelco.bom.bh / aliyahmadi@alayam.com

                         

Premises

 

Subject operates from a large suite of offices and a printing press that are owned and located in the Central Business Area of Manama.

 

 

KEY PRINCIPALS

 

            Name                                                                Nationality                     Position

 

Nabeel Yacoub Yousif Al Hamer                                                Bahraini                        Chairman

 

Moans Mahmoud Mohamed       Al Mardi                        Bahraini                        Director

 

Salwa Yousef Khalil Al Moayed                                      Bahraini                        Director

 

Afnan Rashid Abdulrahman Al Zayani                             Bahraini                        Director

 

Ebrahim Mohamed Ali Bashmi                                       Bahraini                        Director

 

Ahmed Abdulrahman Mahmood Alsaati                          Bahraini                        Director

 

Jassim Khalifa Jassim Alattawi                                      Bahraini                        Director

 

Raed Mahmood Mohamed Almardi                                Bahraini                        Director

 

Esmat S Mohammed Saleh Adnan Almosawi                  Bahraini                        Director

 

Hamad Ali Mohamed Almannaei                                     Bahraini                        Director

 

Khalid Abdulla Abdulwahab Alzayani                              Bahraini                        Director

 

Isa Ali Hasan Alshaiji                                                     Bahraini                        Director

 

Ahmed Juma Mubarak Habib                                         Bahraini                        Director

 

Khalil Yousif Ali Radhi                                                   Bahraini                        Director

 

Ahmed Mohammed Ali Zaman                                       Bahraini                        Director

 

Abdulla Nabeel Yaqoob Alhamar                                    Bahraini                        Director

 

Maryam Nabil Yaqoob Alhamar                                      Bahraini                        Director

 

Rashid Nabeel Yacoob Alhamer                                     Bahraini                        Director

 

Yacoob Nabeel Yacoob Alhamer                                   Bahraini                        Director

 

Isa Al Shaiji                                                                       -                               Editor

 

Abdullatif Abdul Khaliq                                                       -                              Production Manager

 

Ali Al Ahmadi                                                                     -                              Finance Manager

 

Ghassan Al Mamoun                                                          -                              Marketing Manager

 

 

LEGAL FORM & OWNERS

 

Date of Establishment  : 8th February 1989

 

Legal Form      : Bahraini Shareholding Company Closed BSC (C)

 

Commercial Reg. No.   : 20555-1, Manama

 

Chamber Member No.  : 1968

 

Issued Capital              : BD 2,000,000

 

Paid up Capital            : BD 2,000,000

 

Name of Shareholder (s)                                                                   Percentage

 

 Nabeel Yacoub Yousif Al Hamer                                                           59%

 

 Salwa Yousef Khalil Al Moayed                                                               5%

 

Ebrahim Mohamed Ali Bashmi                                                               5%                                          

 

Jassim Khalifa Jassim Alattawi                                                              3%

 

Raed Mahmood Mohamed Almardi                                                          3%

 

 Moans Mahmoud Mohamed      Al Mardi                                                  3%

 

Esmat S Mohammed Saleh Adnan Almosawi                                          3%

 

Hamad Ali Mohamed Almannaei                                                             3%

 

Khalid Abdulla Abdulwahab Alzayani                                                      3%

 

Isa Ali Hasan Alshaiji                                                                             3%

 

Khalil Yousif Ali Radhi                                                                           2%

 

 Afnan Rashid Abdulrahman Al Zayani                                                    1%

 

Ahmed Mohammed Ali Zaman                                                               1%

 

Abdulla Nabeel Yaqoob Alhamar                                                              1%

 

Maryam Nabil Yaqoob Alhamar                                                              1%

 

Rashid Nabeel Yacoob Alhamer                                                             1%

 

Yacoob Nabeel Yacoob Alhamer                                                             1%

 

Ahmed Abdulrahman Mahmood Alsaati                                                    1%

           

Ahmed Juma Mubarak Habib                                                                   1%

 

Notes to the legal Form A BSC (Closed), commonly known as a closed joint stock company, consists of a minimum of two shareholders who subscribe to it by way of negotiable shares that are not offered to the public for subscription. Shareholders are liable           for the company's debts and obligations only to the extent of the value of their shares. The minimum share capital required is BD 250,000. There must be a minimum of three directors. A closed joint stock company can be 100% foreign owned. There is no requirement of local sponsorship. However, depending on the business activity, there may be a requirement of minimum Bahraini ownership.

 

 

 

OPERATIONS

 

Activities: Engaged in the printing and publishing of newspapers and books. Subject prints the “Al Ayam”, “Al

              Methaq” and “Bahrain Tribune” daily newspapers.

 

Import Countries: Europe and GCC countries

 

Principal Suppliers:

 

Giffin Paper                  Bahrain

Warq Co                       Saudi Arabia

Asian Plub                    Indonesia

Heidelberg                    Germany

 

Operating Trend: Steady

 

Subject has a workforce of approximately 400 employees.

 

 

FINANCIAL DATA

 

Financial highlights provided by local sources are given below:

 

Currency: Bahraini Dinar (BD)

 

Year                                                     sales                           

 

Year Ending 31/12/14:                           BD 8,785,000                           

Year Ending 31/12/15:                           BD 9,110,000                           

Year Ending 31/12/16:                           BD 9,660,000                           

Year Ending 31/12/17:                           BD 10,100,000                         

Local sources consider subject’s financial condition to be Fair.

 

Note:    According to Bahraini Commercial Law, only Bahraini Shareholding Companies BSC (Listed on the Bahraini Stock Market) are required to publish their financial information. Financial information on other legal forms can only be obtained from the companies / businesses directly

 

 

BANKERS

 

Arab Bank Plc

Government Avenue

PO Box: 395

Manama

Tel: (973-17) 229988

Fax: (973-17) 210443

 

 

PAYMENT HISTORY

 

No complaints regarding subject’s payments have been reported.

 

Date of transaction                    January 2006                 January 2007                 January 2008

Credit amount                           103,000             168,000             250,000

Amount overdue                        0                                  0                                  0

Payment terms                          180 days                       180 days                       180 days

Payment Method                       Letters of Credit                        Letters of Credit                        Letters of Credit

Paying record                           No Complaints              No Complaints              No Complaints

Currency                                   Pounds Sterling                        Pounds Sterling                        Euros

 

 

SANCTION LIST CHECKS

 

The subject and its shareholders have been checked in the following sanctions list databases:

 

Sanctions list                                                                                                   Results

 

United Nations Sanctions                                                                                   No matches

 

Australian Sanctions                                                                                          No matches

 

Bureau of Industry and Security (US)                                                                  No matches

 

EU Financial Sanctions                                                                                      No matches

 

Office of the Superintendent of Financial Institutions (Canada)                            No matches

 

OFAC - Specially Designated Nationals (SDN)                                                    No matches

 

UK Financial Sanctions (HMT)                                                                            No matches

 

US Consolidated Sanctions                                                                               No matches

 

 

GENERAL COMMENTS

 

During the course of this investigation the following sources were consulted:

 

-  Internal database

-  Journals, directories, media & web searches

-  Local Registry office

 

Please note that the correct name of the subject is “Al Ayam Publication Establishment BSC (C)” and not “Al Ayam Publishing BSCC”.

 

Established in 1989, subject is involved in the printing and publishing of newspapers and books. Subject prints the “Al Ayam”, “Al Methaq” and “Bahrain Tribune” daily newspapers.

 

During the course of this investigation nothing detrimental was uncovered regarding subject’s operating history or the manner in which payments are fulfilled. As such the company is considered to be a fair trade risk.

 

 

COUNTRY OUTLOOK

 

Recent Developments

Cheap oil continues to test Bahrain’s economic resilience. Bahrain maintained an expansionary fiscal stance since 2009 resulting in general government deficits. The situation worsened in 2015 with a decline in oil revenues by about 10 percent of GDP and a general fiscal deficit estimated at 12.8 percent of GDP (from 3.4 percent in 2014). The deficit spending helped maintain economic growth at 2.9 percent, but brought reserves down to a low level at 2.6 months of imports and increased public debt to 62 percent of GDP. Bahrain has introduced some initiatives for fiscal consolidation. Revenue enhancing measures such as higher tobacco and alcohol taxes and government services

fees were introduced over the past year. A cost-cutting program entailed the raising of petrol prices by up to 60 percent in January 2016(likely to create savings worth US$148.4 million), the gradual phasing-in of price increases for electricity, water, diesel, and kerosene by 2019, an increase and unification of natural gas prices for industrial users, and the removal of meat subsidies. Inflation has gradually picked up in 2016 mainly as a result of the subsidy reform: the headline CPI rose by 3 percent, but it will remain subdued in 2017 as one-off measures affect the current year

only. 2016 outcomes demonstrate, however, that the authorities’ emphasis on growth comes at the expense of fiscal deterioration.

 

The Bahraini economy grew by an estimated 3.4 percent in 2016. While the hydrocarbon sector grew by an estimated 2 percent, the non-hydrocarbon sectors grew by an average estimated rate of 3.7 percent, a figure that reflects the continued emphasis on public investments, some of which were funded by the GCC. The downside of this approach, however, has been manifested in persistently high fiscal deficits, estimated at 12.6 percent of GDP in 2016. A large portion of the 2016 deficit was covered by debt issuances, despite the sovereign downgrade reflecting increasing pressures on government finances. Bahrain issued a US$600 million bond just before the downgrade and the authorities raised the public debt ceiling to BD 10 billion (around 80 percent of GDP) to enable additional borrowing. Bahrain’s external position faces growing vulnerabilities. The current account surplus of the past 12 years turned into a deficit in 2015, following the drop in oil prices and further deteriorated in 2016 to 4.6 percent of GDP. Reserve adjustments reflect the growing external imbalances. The exchange rate peg has come under significant pressure: external imbalances were reflected in a decline in reserves to 2.6 months of imports in the same time

frame. The real effective exchange rate has also appreciated by 17 percent since mid-2014, complicating adjustments to the adverse terms of trade shock that Bahrain is facing.

 

Little comprehensive welfare analysis is available due to restricted access to household survey data, limited capacity, and the sensitivities involved. Among Bahraini nationals’, labour force participation is low, and people work predominantly in the public sector, where wages are high and productivity low. Immigrant workers constitute about a half of the resident population and command much lower incomes. Key elements of the social contract - public employment and subsidies - are becoming less affordable in the context of subdued oil prices. Bahrain aims to gain from upgrading its capacity for welfare measurement that would support the design of policies aimed at mitigating the impact of the necessary adjustment. Results from a new household survey in 2015 have not yet been published.

 

Outlook

Economic growth is expected to decline in the forecast period. Real GDP growth projections have been revised downwards to 1.9 percent in 2017 and 2018, as continuing low oil prices depress private and government consumption. Some infrastructure investments are also likely to be put on hold. In the absence of significant upfront

fiscal adjustments, Bahrain will remain vulnerable to fiscal risks. Average inflation is expected to decrease to 2.1 percent in 2017 reflecting the cooling off in economic activity and phasing out of temporary price-boosting effects of subsidy reforms. The current account deficit will partially narrow to 3.8 percent of GDP in 2017 and remain about there for the years to come, with the exception of small adjustments. International reserves are expected to follow a declining trend, and reach 1.5 months of imports in 2018. Public debt is projected to exceed 90 percent of GDP in 2017, and reach about 100 percent in 2018.

 

Risks and Challenges

Ensuring fiscal sustainability while preserving a healthy growth rate has become an important challenge in Bahrain. Real GDP growth is expected to slow and fiscal and external balances are expected to remain under pressure in 2017 due to oil prices remaining well below fiscal break-even levels. Despite efforts to diversify and boost non-oil fiscal revenues, hydrocarbons account for about 80 percent of government revenues in Bahrain. In addition, subsidies still absorb more than 20 percent of the fiscal budget. The fiscal break-even price for Bahrain was estimated at US$110 per barrel in 2016, the highest amongst the GCC. Thus, Bahrain is expected to continue to run significant general fiscal deficits in the forecast period - 9.8 percent of GDP in 2017. Delays in implementing fiscal consolidation or a

further decline in oil prices could trigger additional sovereign rating downgrades making access to external financing harder, and intensifying pressure on reserves and the peg. Fiscal solvency and liquidity risks are high, and outcomes remain vulnerable to shocks to growth, commodity prices, and interest rates.

 

Key Economic Indicators                                   2014     2015     2016*    2017*    2018*    2019*

 

Real GDP Growth (%)                                        4.4          2.9        3.4     1.9       1.9       2.3

Inflation Rate (%)                                               2.7          1.8        3.0     2.1       2.0       2.0

Current Account Balance (% of GDP)                 4.6         -2.4       -4.6     -3.8       -3.5       3.5

Fiscal Balance (% of GDP)                                -3.4       -12.8     -12.6     -9.8       -8.9       -7.6

 

* forecast

 

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

INR 65.35

UK Pound

1

INR 92.70

Euro

1

INR 80.80

BHD

1

INR 172.96

 

Note : Above are approximate rates obtained from sources believed to be correct

 

 

INFORMATION DETAILS

 

Analysis Done by :

DIV

 

 

Report Prepared by :

KET

                                                


 

RATING EXPLANATIONS

 

Credit Rating

Explanation

Rating Comments

A++

Minimum Risk

Business dealings permissible with minimum risk of default

A+

Low Risk

Business dealings permissible with low risk of default

A

Acceptable Risk

Business dealings permissible with moderate risk of default

B

Medium Risk

Business dealings permissible on a regular monitoring basis

C

Medium High Risk

Business dealings permissible preferably on secured basis

D

High Risk

Business dealing not recommended or on secured terms only

NB

New Business

No recommendation can be done due to business in infancy stage

NT

No Trace

No recommendation can be done as the business is not traceable

 

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

 

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 are as follows:

 

·         Financial condition covering various ratios

·         Company background and operations size

·         Promoters / Management background

·         Payment record

·         Litigation against the subject

·         Industry scenario / competitor analysis

·         Supplier / Customer / Banker review (wherever available)

 

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.