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MIRA INFORM REPORT
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Report No. : |
486308 |
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Report Date : |
18.01.2018 |
IDENTIFICATION DETAILS
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Name : |
COVERIS FLEXIBILE EGYPT SAE |
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Formerly Known As : |
KOBUSCH PACKAGING EGYPT SAE (KPE) |
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Registered Office : |
First Industrial Zone, Block 7, New Borg El Arab, PO Box 440,
Alexandria |
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Country : |
Egypt |
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Financials (as on) : |
31.12.2017 |
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Date of Incorporation : |
1992 |
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Com. Reg. No.: |
134024, Alexandria |
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Legal Form : |
Egyptian Joint Stock Company |
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Line of Business : |
Subject is engaged in the manufacture and export of flexible packaging
materials, including printed plastic bags for juice and powdered milk, as
well as printing for plastic sacks, aluminium and paper. |
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No. of Employees : |
300 |
RATING & COMMENTS
(Mira Inform has adopted New Rating mechanism w.e.f. 23rd January
2017)
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MIRA’s Rating : |
A+ |
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Credit Rating |
Explanation |
Rating Comments |
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A+ |
Low Risk |
Business dealings permissible with low
risk of default |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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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
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Country Name |
Previous Rating (30.06.2017) |
Current Rating (30.09.2017) |
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Egypt |
C1 |
C1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low Risk |
A2 |
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Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderately High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
EGYPT - ECONOMIC OVERVIEW
Occupying the northeast corner of the African continent, Egypt is
bisected by the highly fertile Nile valley, where most economic activity takes place.
Egypt's economy was highly centralized during the rule of former President
Gamal Abdel NASSER but opened up considerably under former Presidents Anwar
EL-SADAT and Mohamed Hosni MUBARAK.
Cairo from 2004 to 2008 pursued business climate reforms to attract
foreign investment and facilitate growth. Poor living conditions and limited
job opportunities for the average Egyptian contribute to public discontent, a
major factor leading to the January 2011 revolution that ousted MUBARAK. The
uncertain political, security, and policy environment since 2011 caused
economic growth to slow significantly, hurting tourism, manufacturing, and
other sectors and pushing up unemployment, which remains above 10%.
Weak growth and limited foreign exchange earnings have made public
finances unsustainable, leaving authorities dependent on expensive borrowing
for deficit finance and on Gulf allies to help cover the import bill. In
2015-16, higher levels of foreign investment contributed to a slight rebound in
GDP growth after a particularly depressed post-revolution period. In 2016,
Cairo enacted a value-added tax, implemented fuel and electricity subsidy cuts,
and floated its currency, which led to a sharp depreciation of the pound and
corresponding inflation. In November 2016, the IMF approved a $12 billion,
three-year loan for Egypt and disbursed the first $2.75 billion tranche.
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Source
: CIA |
SUMMARY
Company Name :
COVERIS FLEXIBILE EGYPT SAE
Previously Known As : KOBUSCH
PACKAGING EGYPT SAE (KPE)
Country of Origin :
Egypt
Legal Form :
Egyptian Joint Stock Company
Registration Date :
1992
Commercial Registration Number :
134024, Alexandria
Industrial Licence Number :
23790
Tax Card Number :
100-443-117
Issued Capital :
£E 62,621,000
Paid up Capital :
£E 62,621,000
Total Workforce :
300
Activities :
Manufacturers of flexible packaging materials
Financial Condition :
Good
Payments :
Regular
Operating Trend :
Steady
COMPANY
NAME
COVERIS FLEXIBILE EGYPT SAE
ADDRESS
Registered &
Physical Address
Location : First
Industrial Zone, Block 7
Area : New Borg El
Arab
PO Box : 440
Town : Alexandria
Country : Egypt
Telephone : (20-3) 4591023
/ 4938164 / 4592472 / 4592473 / 4620023
Facsimile : (20-3) 4593314
/ 4592471
Mobile : (20-12)
7698866 / 7698855 / (20-10) 1626613 / 20-100 6852222
Email : wdaabis@pactiv.com
/ rarasole@pregis.com
/ hassan.ibrahim@coveris.com
Premises
Subject operates from a large suite of offices, warehousing and a
factory that are owned and located in the Industrial Area of Alexandria.
Branch Offices
Location Description
Suez Canal Tower Office
premises
4 Ibn Kathier Street
Giza
Cairo
Tel: (20-2) 33360935
Fax: (20-2) 33360935
KEY
PRINCIPALS
Name Position
Rabeh Mohamed Fouzi El Sherif General
Manager
Maged Hassan Finance
Manager
Hassan Ibrahim Financial
Controller
Abdul Moniem Dawoud Purchasing
Manager
Mohamed Farghaly Operations
Manager
Atef Omar R
& D Manager
Yaser Medhat Administration
Manager
LEGAL
FORM & OWNERS
Date of Establishment : 1992
History : Subject began in
1992 under the name “Kobusch Packaging Egypt SAE (KPE)”.
However in June 2014 it changed its name to
“Coveris Flexible Egypt SAE”
Legal Form : Egyptian Joint
Stock Company
Commercial Reg. No. : 134024,
Alexandria
Industrial Licence No. : 23790
Tax Card No. : 100-443-117
Issued Capital : £E 62,621,000
Paid up Capital : £E 62,621,000
Name of
Shareholder (s) Percentage
Coveris Group 100%
Chicago, IL
United States of America
Tel: (1-773) 8773300
Notes to the legal
Form A Joint Stock Company ( SAE ) can be both a public or private company
the capital of which is divided into shares of equal value; the liability of
the shareholder is confined to the value of the shares to which he subscribes,
and he is not liable for the debts of the company except within the limit of
those shares. A JSC may be 100% owned by foreign investors and there should be
at least three shareholders. The minimum capital of JSC companies is EGP
250,000 or EGP 500,000 if it is a public company.
OPERATIONS
Activities: Engaged in the manufacture and export of flexible packaging materials,
including printed plastic bags for juice and powdered milk, as well as printing
for plastic sacks, aluminium and paper.
Subject is ISO 9001:2000 certified.
Production Capacity: 14,300 tonnes per annum
Import Countries: Netherlands, Germany, France, Qatar and the United
States of America
Export Countries: Saudi Arabia, Yemen, United Arab Emirates,
Lebanon, Morocco, Nigeria and Kenya
Operating Trend: Steady
Subject has a workforce of approximately 300 employees.
FINANCIAL
DATA
Financial
highlights provided by local sources are given below:
Currency: Egyptian
Pounds (EGP)
Year Sales
Year Ending 31/12/15: EGP
270,000,000
Year Ending 31/12/16: EGP
273,000,000
Year Ending 31/12/17: EGP
280,000,000
Local sources consider subject’s financial condition to be Good.
Note: According to Egyptian Commercial Law, only
Joint Stock Companies SAE (Listed on the 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
Commercial International Bank (CIB)
61 Sultan Hussein Street
Alexandria
Tel: (20-3) 34824643 / 34834255
Fax: (20-3) 34832240
Egyptian American Bank
14 Salah Salem Street
PO Box: 1737
Alexandria
Tel: (20-3) 34835008
PAYMENT
HISTORY
Regular
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
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
The first quarter of FY17 (July to June)
marked a slowdown in growth recording 3.4 percent compared to 5.1 percent in
the same quarter last year, with annual growth in FY16 registering 4.3 percent.
Growth was constrained by severe shortages in hard currency, an overvalued
exchange rate and sluggish growth in Europe, Egypt’s main trading partner. Key
sectors continue to experience negative growth, particularly tourism and the
oil and gas extractives sector that has been suffering from underinvestment and
arrears.
The annual fiscal deficit in FY16 increased
to 12.1 percent of GDP, up from 11 percent the year before. However, in the
first half of FY17 the deficit declined to 5.4 percent of GDP, down from 6.4
percent in the same period last year. The improvement in the first half is
solely driven by a decline in total expenditures, which compensates for a drop
in total revenues. Lower expenditures were driven by a decrease in subsidies
and public wages as a percentage of GDP.
The most recent data for the first quarter of
FY17 show an overall surplus in the balance of payments of 0.5 percent of
projected GDP, compared to a deficit of 1 percent during the same period of the
previous year. The improvement in external accounts was mainly due to the
narrowing trade deficit induced by an increase in merchandise exports (by 11.2
percent) and a decline in merchandise imports (by 4.8 percent). Meanwhile, Suez
Canal receipts further deteriorated by 4.8 percent and net private transfers
also declined by 21.8 percent. As a result, the current account deficit widened
to 1.4 percent of GDP compared to 1.1 percent in the same quarter of the
previous year. More positively, FDI inflows increased to US$1.9 billion over
the same period, up from US$1.4 billion the previous year.
To stimulate growth and address major
macroeconomic imbalances, the government embarked on a major economic reform
program. The key features include (i) the liberalization of the exchange rate
regime; (ii) fiscal consolidation through a combination of expenditure and
revenue measures, notably cuts in fuel subsidies, containment of the wage bill
and introduction of VAT; and (iii) reforms to the business environment and
addressing impediments to industrial activity.
The reform program was supported by an IMF
Extended Fund Facility of US$12 billion which contributes to cover Egypt’s financing
needs, the rest of which has been covered through disbursements under the World
Bank, the African Development Bank and a number of bilateral loans, in addition
to a recent issuance of Eurobonds in the amount of US$4 billion. Following the
floatation, the exchange rate displayed strong overshooting (hitting its
lowest rate of 19.5 in December compared to a
pre-float fixed rate of 8.8), but has subsequently strengthened as foreign
investor confidence picked up and backlogs of USD orders to finance imports
eased. Net international reserves reached US$26.4 billion at-end January (6
months’ imports), up from a pre-floatation level of US$19 billion.
Currency weakening has led to a sharp rise in
inflation, which reached its highest recorded level of 30.2 percent in February
2017. Following the currency floatation, the CBE increased interest rates by
300 basis points (bringing the cumulative increase to 550 basis points since
March 2016) to absorb excess liquidity and curb inflation. High inflation has contributed
to the aggravation of social conditions, given the persistently high
unemployment (12.6 percent in 2016). The recently adopted reform program
involves efforts to improve social safety nets, notably through the partial
reallocation of freed up resources from reduced energy and food subsidies; the
expansion of cash transfer programs; and an increase in the general pension
budget by 15 percent. Nonetheless, the mitigation of recent adverse
shocks will continue to depend on an
effective targeting mechanism.
Outlook
GDP is expected to grow by 3.9 percent in
FY17, and will be largely driven by public investment and to some extent net
exports. Private investment is expected to pick up only in the second half of
FY17, supported by enhanced competitiveness following the depreciation of the
currency and the gradual implementation of business climate reforms. Tourism is
also expected to steadily recover on the back of a weaker currency. Yet, growth
will likely be undermined by slower growth of private consumption, which is
expected to be negatively affected by record high inflation rates. Prudent
monetary policy is projected to bring inflation down over the forecast horizon
after the one off effects of depreciation, subsidy reforms, and the
introduction of VAT dissipate.
The fiscal deficit is projected to narrow to
10.5 percent in FY17, contingent on the government’s commitment and ability to
sustain its fiscal consolidation plan. With the implementation of the VAT, the
expected increase in the VAT rate to 14 percent from the current 13 percent,
and efforts to improve tax collection, revenues are expected to improve, while
expenditures will continue to be contained.
The current account deficit is expected to
start improving in FY17, supported by a positive exchange rate effect and an
increase in remittances transferred through formal channels.
In the near term high inflation is likely to
have negative short-term effects on households. Current efforts to improve
targeting in the food smart-card program,
currently used to protect the vulnerable population from food price shocks and
ensure a minimum level of food security, could provide additional resources for
an improved safety net.
Risks and challenges
Policy slippage and absence of real-sector
reforms may negatively impact the anticipated economic recovery. Deteriorating
security risks can adversely affect the recovery of the tourism sector,
traditionally a main source of revenue and foreign currency.
On the social front, resources from fuel
subsidy reform to be allocated to social programs may be lower than expected
due to currency depreciation, but efforts
should continue to improve the efficiency of the safety net system. Sustained
high unemployment may lower households’ ability to improve their living conditions.
Key Economic
Indicators 2014 2015 2016* 2017* 2018 2019
Real GDP Growth (%) 2.9 4.4 4.3 3.9 4.6 5.3
Inflation Rate (%)
10.1 10.4 10.2 20.1 14.2 11.3
Current Account Balance (% of GDP) -0.9 -3.8 -6.1 -5.5
-4.4 -3.8
Fiscal Balance (% of GDP) -11.5 -11.0 -12.1 -10.5
-9.2 -7.3
* Forecast
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 63.97 |
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1 |
INR 88.13 |
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Euro |
1 |
INR 78.35 |
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EGP |
1 |
INR 3.60 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
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Analysis Done by
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DIV |
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Report Prepared
by : |
TPT |
RATING EXPLANATIONS
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Credit Rating |
Explanation |
Rating Comments |
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A++ |
Minimum Risk |
Business dealings permissible with minimum
risk of default |
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A+ |
Low Risk |
Business dealings permissible with low
risk of default |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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B |
Medium Risk |
Business dealings permissible on a regular
monitoring basis |
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C |
Medium High Risk |
Business dealings permissible preferably
on secured basis |
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D |
High Risk |
Business dealing not recommended or on
secured terms only |
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NB |
New Business |
No recommendation can be done due to
business in infancy stage |
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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)
This report is issued at
your request without any risk and responsibility on the part of MIRA INFORM
PRIVATE LIMITED (MIPL) or its officials.