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MIRA
INFORM REPORT
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Report No. : |
495249 |
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Report Date : |
07.03.2018 |
IDENTIFICATION DETAILS
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Name : |
KLIL INDUSTRIES LTD. |
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Formerly Known As : |
KLIL NON-FERROUS METAL INDUSTRIES LTD |
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Registered Office : |
P.O. Box 659,13 Zur Street,Eastern Industrial Zone, Karmiel, 2161601 |
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Country : |
Israel |
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Financials (as on) : |
30.09.2017 |
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Date of Incorporation : |
1950 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturers, importers, marketers and exporters of aluminum
profiles, shutters, curtain walls, door and window frames, as well as allied
hardware products. Also developers, manufacturers, importers and marketers of
allied accessories for aluminum profile systems |
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No. of Employees : |
316 |
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 |
Acceptable Risk |
Business dealings permissible with
moderate 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 (30.09.2017) |
Current Rating (31.12.2017) |
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Israel |
B1 |
B1 |
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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 |
ISRAEL - ECONOMIC OVERVIEW
Israel has a technologically advanced free market economy. Cut diamonds, high-technology equipment, and pharmaceuticals are among its leading exports. Its major imports include crude oil, grains, raw materials, and military equipment. Israel usually posts sizable trade deficits, which are offset by tourism and other service exports, as well as significant foreign investment inflows.
Between 2004 and 2013, growth averaged nearly 5% per year, led by exports. The global financial crisis of 2008-09 spurred a brief recession in Israel, but the country entered the crisis with solid fundamentals, following years of prudent fiscal policy and a resilient banking sector. Israel's economy also weathered the 2011 Arab Spring because strong trade ties outside the Middle East insulated the economy from spillover effects.
Slowing domestic and international demand and decreased investment resulting from Israel’s uncertain security situation reduced GDP growth to an average of roughly 2.8% per year during the period 2014-17. Natural gas fields discovered off Israel's coast since 2009 have brightened Israel's energy security outlook. The Tamar and Leviathan fields were some of the world's largest offshore natural gas finds in the last decade. Political and regulatory issues have delayed the development of the massive Leviathan field, but production from Tamar provided a 0.8% boost to Israel's GDP in 2013 and a 0.3% boost in 2014. One of the most carbon intense OECD countries, Israel generates about 57% of its power from coal and only 2.6% from renewable sources.
Income inequality and high housing and commodity prices continue to be a concern for many Israelis. Israel's income inequality and poverty rates are among the highest of OECD countries, and there is a broad perception among the public that a small number of "tycoons" have a cartel-like grip over the major parts of the economy. Government officials have called for reforms to boost the housing supply and to increase competition in the banking sector to address these public grievances. Despite calls for reforms, the restricted housing supply continues to impact the well-being of younger Israelis seeking to purchase homes. Tariffs and non-tariff barriers, coupled with guaranteed prices and customs tariffs for farmers kept food prices high in 2016. Private consumption is expected to drive growth through 2018 with consumers benefitting from low inflation and a strong currency.
In the long term, Israel faces structural issues, including low labor participation rates for its fastest growing social segments - the ultraorthodox and Arab-Israeli communities. Also, Israel's progressive, globally competitive, knowledge-based technology sector employs only about 8% of the workforce, with the rest mostly employed in manufacturing and services - sectors which face downward wage pressures from global competition. Expenditures on educational institutions remain low compared to most other OECD countries with similar GDP per capita.
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Source : CIA |
Company name and address
RE: KLIL INDUSTRIES LTD.
Telephone 972
4 990 02 00
972 4 995 31 64
Fax 972 4 990 02 55
972 4 995 31 26
E-mail: yoni@klil.co.il
P.O. Box 659
13 Zur Street
Eastern Industrial Zone
Karmiel,
2161601, Israel
HISTORY & LEGAL FORMATION
Originally incorporated
as a private limited company and registered as such as per file No. 51-036317-9
on the 26.09.1962, continuing the activities of a company founded in 1950.
Converted into a
public limited liability company and registered as such as per file No. 52-003244-2
on the 12.06.1981 and in August 1981 published a prospectus offering shares to
the public through the Tel Aviv Stock Exchange.
Originally
registered under the name of KLIL NON-FERROUS METAL INDUSTRIES LTD., which
changed to the present one on the 08.02.1982.
SHARE CAPITAL
Authorized share
capital NIS 45,000,000.00, divided into -
9,000,000 ordinary
shares of NIS 5.00 each,
of which 2,773,166
shares amounting to NIS 13,865,830.00 were issued.
SHAREHOLDERS
1.
Zur (Zuri) Daboosh, holding 62.32% of subject’s
shares (via DABOOSH HOLDINGS LTD.),
2.
Arie (Richy) Richtman, 1.3%,
3.
MIGDAL (7.5%) an institutional investor,
4.
Shares are also traded on the Tel Aviv Stock
Exchange.
In 2001 Zuri
Daboosh acquired from DISCOUNT INVESTMENT CORPORATION LTD. 67.5% of their
shares in subject in consideration of NIS 97 million. In December 2002, Zuri
Daboosh acquired the remainder of DISCOUNT INVESTMENT shares (5%) in subject,
for a sum of NIS 7.5 million.
Later he realized
some holdings, eventually reaching current holding.
DIRECTORS
1. Zur (Zuri) Daboosh, Chairman,
2. Kobi Levy,
3. Ms. Neomi
Enoch,
4. Ms. Diana
Lavan,
5. Micha Lazar.
GENERAL MANAGER
Arie (Richy)
Richtman.
BUSINESS
Manufacturers,
importers, marketers and exporters of aluminum profiles, shutters, curtain
walls, door and window frames, as well as allied hardware products. Also
developers, manufacturers, importers and marketers of allied accessories for
aluminum profile systems.
In addition, via
subsidiary ROLL PROFILE, manufacturers and marketers of rolling shutters (in
2016 comprised 10% of Group’s sales, 8.1% in 2015).
Products are
mainly for construction and industrial use.
In 2016 3.5% of
sales were for export (4.5% in 2012).
Sales are to the
building sector (wholesalers in and doors and windows manufacturers) and
industrial factories.
Some 94% of
profile sales are for the construction sector, and some 6% for the industry.
Among clients:
SULAMOT HAGIT, MEFAZREI YAAD ALUMINUM INDS., ISI YOGEV INDS., SPACE IT,
GRAZIANI INDUSTRIES, DELKOUB, SHEFER ALUMINIUM INDS., ALUM ESHET, etc.
Operating from
owned (very long lease from the State) premises (offices, storage facilities,
showroom and plant) on an area of 105,000 sq. meters (35,000 sq. meters built),
in 13 Zur Street, Eastern Industrial Zone, Karmiel.
Also operating
from additional showrooms in Haifa, Netanya and Rishon Le-Zion.
Website: www.klil.co.il
Having 316
employees as of end of 2016 (had 301 employees in end of 2015).
Note: current number of employees expected to be
updated with the publication of subject's 2017 financial statements by the end
of March 2018.
MEANS
Consolidated B/S
shows:
NIS
(thousands)
ASSETS 31.12.2016 30.09.2017
Current assets
Cash and cash equivalents 43,328 69,006
Investment in marketable
securities 54,178 55,038
Customers 69,347 63,405
Other debtors and assets 8,730 3,318
Stock 63,383 58,185
238,966 248,952
Non-current assets
Fixed assets (net) 100,697 100,424
Other non-current assets 1,215 1,214
101,912 101,638
340,878 350,590
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LIABILITIES
Current liabilities 74,660 67,530
Non-current liabilities 8,788 10,258
Equity 257,430 272,802
340,878 350,590
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Current market
value US$ 221.4 million.
In 2002, subject raised NIS 50 million in a
public issue of Bonds and Options.
In 2006 subject
sold its holdings (50%) in a 52,000 plot (real estate) in Kiryat Motzkin, for
NIS 30 million.
Subject is an
“Approved Enterprise” and as such enjoys tax benefits and State incentives.
There no charges registered on the company's
assets.
REVENUES
Consolidated
Statement of Income
NIS
(thousands)
Year
ended 31.12
2014 2015 2016
Sales 378,681 372,635 379,565
Gross profit 122,907 106,853 130,023
Operating income 72,841 60,134 81,850
Profit before taxes on
income 69,681 60,204 81,899
Net income 51,813 43,982 62,354
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Consolidated first
9 months of 2017 sales were NIS 191,760,000 (1.5% increase from the parallel
period of 2016), making a gross profit of NIS 95,859,000, an operating profit
of NIS 59,646,000, making a net profit of NIS 45,242,000.
OTHER COMPANIES
ROLL PROFILE LTD.,
82.8%, developers, manufacturers and marketers of shutters and shutters cases.
BANKERS
According to our
records (since we could not speak to subject’s officials, we were unable to
verify the u/m bank details):
Israel Discount
Bank Ltd., Haifa Main Branch (No. 070), Haifa, account
No. 118737.
Bank Leumi
Le’Israel Ltd., Hamifratz Business Branch (No. 898), Kiryat Bialik, account No.
151200/15.
The First
International Bank of Israel Ltd., Haifa Bay Branch (No. 004), Haifa, account
No. 392391.
A check with the Central Banks' database did not reveal any negative
information regarding subject's a/m accounts.
CHARACTER AND REPUTATION
Nothing unfavorable
learned (besides a lawsuit from 2015 against subject which ended in a
compromise for an insignificant sum).
Subject is the one
of the leading companies in their fields in Israel, with estimated market share
of one third – one quarter of the products manufactured in Israel from aluminum
profiles. Subject’s products are well-known in their quality.
In 2016 subject
manufactured 13,000 tons (12,300 tons in 2015) of aluminum profiles, a quantity
reflecting average production capacity of 85%-90%.
In the shutters
field, in 2016 ROLL manufactured 360,000 sq. meters of shutters (76% production
capacity).
According
to estimations in the Aluminum branch, total of annual manufacturing in the
aluminum profiles for construction and industry in Israel in the recent years
summed at 60,000 tons, in money value of NIS 1.2 billion.
There
are several aluminum profile manufacturers in Israel and Palestinian Authority
teritorries the rest is from import, where is the last years import has been
increasing from China, Jordan and other countries.
According to Central Bureau of Statistics
(CBS), import of Aluminum and articles thereof to Israel in
2016 reached US$ 519.8 million, compared to US$ 523.8 million in 2015 and US$
561.3 million in 2014. Import of such during the first 11 months of 2017 rose by 7.4%
compared to the parallel period in 2016.
Subject meets the
ISO 9001 standard of quality.
Mr. Zuri Daboosh
was one of the founders of EMBLAZE, publicly traded on the London Stock
Exchange. In year 2000 he materialized 12% from his 25% shares in EMBLAZE in
consideration of US$ 45 million.
In 2000 subject
signed a marketing agreement with the German aluminum manufacturer, ALUKON,
according to which ALUKON will exclusively distribute subject’s profiles in
Europe, which are also registered as a patent.
In 2007 subject
signed a 3 years agreement with American ALCOA, for subject's exclusive license
to manufacture and market ALCOA's products (ALCOA – KAWNEER) in Israel, in
return for royalties. ALCOA is the world's largest aluminum company. The
products are designed for the luxurious apartment building, mainly for the new
trend of tower apartment buildings which are being constructed in Tel Aviv and
the country's center. Subject's officials estimated the aluminum raw materials
in each tower at value of US$ 1 million.
The
local Metal, Electricity and Infrastructure Industries manufacture 21% of
Israel's industrial prodction, according to data by the Metal, Electrical and
Infrastructure Industries Association, representing, large scale
export-oriented industries on one hand and family-owned plants which sell to
the local market.
2012
sales (local and export) by the said industries amounted to NIS 75 billion, of
which US$
9 billion were for export (20% of Israel's industrial export).
The Home Design area is directly influence
by the changes in the local market in general, and construction and real estate
market in particular.
From the Central Bureau of Statistics (CBS)
data, investments in construction for dwelling in 2016 rose by 8.6% from the
previous year, which follows 2.2% increase in 2015 and increase of 6.4% in
2014.
Investments in construction not for dwelling
(public institutions, commercial and industrial building) rose in 2016 by 1%
(after 3.9% rise in 2015 and 3.6% in 2014), and investments in construction in
other construction works (e.g. roads, infrastructure) saw 2.1% rise in 2016,
continuing the upward trend (by 3.3%) in 2015 (after falling by 18.2% in 2014).
From the CBS data, in 2016 the volume of building starts for dwelling
(which is a dominant indicator for the trend in the building sector) amounted
to 53,661 housing units, compared with 53,503 units from 2015 (in 2014 there
were 46,987 building starts, 47,704 in 2013 and 43,454 building starts in 2012),
and well below the Government's goal for 60,000 building starts.
In the 1st
half of 2017 building starts were close to 23,300 units, 12.5% lower than the 1st
half of 2016.
The number of building finishing in 2016 reached 46,091 units, 6% higher
than 2015 (2015 marked 2.5% decrease in building finishing from 2014).
Number of dwellings transactions in 2015 reached a climax with total of
120 thousands transactions (rise in both new and second-hand apartments), but
started decreasing in 2016, due to the government's policy of tax raising. That
decreasing trend intensified into 2017. According to the review by the Chief
Economist at the Ministry of Finance, in 2017 close to 100,000 apartment were
sold, which represents estimated decrease of 11%-12% from 2016.
The annual volume of houses renovations
according to the Renovations Contractors Association is estimated at NIS 15
billion, and the turnover of the ceramics branch is estimated to capture NIS
2.3 billion (which comprises some 80% of the branch's total volume).
According
to the CBS, export by the local Manufacturing of Fabricated Metal Products, Machinery
& Equipment and Domestic Appliances witnessed 1.6% decrease in 2017 from
2016 to US$ 5,851.5 million, after 8.4% increase in 2016 from 2015 and 9.1%
decrease in 2015 from 2014.
The
CBS data on investment in imported machinery and other equipment for the
manufacturing industry in 2016 (comparing to the previous year): investments in
the manufacture of basic metal totaled NIS 277.5 million, representing 28%
rise, after 9% decrease in 2015; investments in the manufacture of fabricated
metal products was NIS 949 million, 2.3% decrease, after increase by 4.8% in
2015.
SUMMARY
Notwithstanding
the lack of updated data from subject's officials, considered good for trade
engagements.
Note: Since February 2013 Israel Post has
started using a new area code method of 7 digits (the old method of 5 digits is
no longer valid).
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 64.99 |
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1 |
INR 89.91 |
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Euro |
1 |
INR 80.21 |
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ILS |
1 |
INR 18.78 |
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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NIY |
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Report Prepared
by : |
SYL |
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.