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MIRA INFORM REPORT
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Report No. : |
511762 |
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Report Date : |
29.05.2018 |
IDENTIFICATION DETAILS
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Name : |
METHANOL CHEMICAL COMPANY LTD (CHEMANOL) |
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Formerly Known As : |
SAUDI FORMALDEHYDE CHEMICAL COMPANY LTD (SFCCL) |
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Registered Office : |
Tower No. 3, 1st Floor Dammam Khobar Highway Novotel Business Park PO Box 3139 & 6139 Dammam 31471 |
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Country : |
Saudi Arabia |
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Financials (as on) : |
31.12.2017 |
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Date of Incorporation : |
31.07.1989 |
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Com. Reg. No.: |
2050057828 |
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Legal Form : |
Saudi Joint Stock Company |
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Line of Business : |
Subject engaged in the production of premium grade
Formaldehyde and derivative products, including Formalin, Melfores,
Paraformaldehyde and Ufores. |
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No. of Employees : |
530 |
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 : |
Satisfactory |
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Payment Behaviour : |
Slow |
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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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Saudi Arabia |
A2 |
A2 |
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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 |
SAUDI
ARABIA - ECONOMIC OVERVIEW
Saudi Arabia has an oil-based economy with strong government controls over major economic activities. It possesses about 16% of the world's proven petroleum reserves, ranks as the largest exporter of petroleum, and plays a leading role in OPEC. The petroleum sector accounts for roughly 87% of budget revenues, 42% of GDP, and 90% of export earnings.
Saudi Arabia is encouraging the growth of the private sector in order to diversify its economy and to employ more Saudi nationals. Approximately 6 million foreign workers play an important role in the Saudi economy, particularly in the oil and service sectors; at the same time, however, Riyadh is struggling to reduce unemployment among its own nationals. Saudi officials are particularly focused on employing its large youth population.
In 2017, the Kingdom incurred a budget deficit estimated at 8.3% of GDP, which was financed by bond sales and drawing down reserves. Although the Kingdom can finance high deficits for several years by drawing down its considerable foreign assets or by borrowing, it has cut capital spending and reduced subsidies on electricity, water, and petroleum products and recently introduced a value-added tax of 5%. In January 2016, Crown Prince and Deputy Prime Minister MUHAMMAD BIN SALMAN announced that Saudi Arabia intends to list shares of its state-owned petroleum company, ARAMCO - another move to increase revenue and outside investment. The government has also looked at privatization and diversification of the economy more closely in the wake of a diminished oil market. Historically, Saudi Arabia has focused diversification efforts on power generation, telecommunications, natural gas exploration, and petrochemical sectors. More recently, the government has approached investors about expanding the role of the private sector in the health care, education and tourism industries. While Saudi Arabia has emphasized their goals of diversification for some time, current low oil prices may force the government to make more drastic changes ahead of their long-run timeline.
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Source
: CIA |
SUMMARY
Company Name : METHANOL CHEMICAL COMPANY LTD (CHEMANOL)
Also Known As : THE FACTORY OF METHANOL CHEMICALS COMPANY /
CHEMANOL SAUDI ARABIA
Previously Known As : SAUDI FORMALDEHYDE CHEMICAL COMPANY LTD (SFCCL)
Country of Origin : Saudi Arabia
Legal Form : Saudi Joint Stock Company
Registration Date : 31st July 1989
Commercial Registration Number : 2050057828, Dammam
Chamber Membership Number : 405
Issued Capital : SR 1,206,000,000
Paid up Capital : SR 1,206,000,000
Total Workforce : 530
Activities : Producers of Formaldehyde and derivative products
Financial Condition : Poor
Payments : Slow
COMPANY
NAME
METHANOL CHEMICAL
COMPANY LTD (CHEMANOL)
ALSO
KNOWN AS: THE FACTORY OF METHANOL CHEMICALS
COMPANY / CHEMANOL SAUDI ARABIA
ADDRESS
Registered &
Physical Address
Building :
Tower No. 3, 1st Floor
Street :
Dammam Khobar Highway
Area : Novotel Business Park
PO Box :
3139 & 6139
Town :
Dammam 31471
Country :
Saudi Arabia
Telephone : (966-13)
8144685 / 3438888 / 3581111
Facsimile :
(966-13) 8144678 / 8342283
Mobile :
(966-50) 4499385 / (966-55) 3435060 / (966-56) 9672538
Email : sfccl@saudiform.com
/ fawaz@chemanol.com
/ info@chemanol.com
/ legal@chemanol.com
Please note that subject’s previous address was, Al Moujil
Building, Al Dhahran Street, Dammam.
Premises
Subject operates from a large suite of offices that are
rented and located in the Central Business Area of Dammam.
Branch Office (s)
Location Description
· Tareeq
198 Secondary Industries Park Owned
factory premises
Section
P, Block 5, Lot No. 4 & 6, Administrative Bldg
PO Box: 2101 / 7953
Jubail 31951
Tel: (966-13) 3438888
/ 3438009 / 3438223 / 3438071 / 3435060
Fax: (966-13) 3583592
CR No.
2055001870
KEY
PRINCIPALS
Name Position
· Abdullah
Mohamed Al Mazrouie Managing
Director
· Khalid
Al Zamil Director
· Adeeb
Al Zamil Director
· Bader
Kanoo Director
· Abdul
Mohsen Al Nafsi Director
· Sami
Jalal Director
· Hamad
Al Manae Director
· Abdullah Al Sane Director
· Mishaal Kanoo Director
· Khalid Bin Ibrahim Al Rabieh Chief Executive
Officer
· Fawaz Al Abbad Human
Resources Manager
· Eid Al Doussary Administration
Manager
· Ahmed Al Hassan Finance
Manager
· Mohamed Nasser Assistant
Finance Manager
· Khalid Mahroom Operations
Manager
· Ibrahim Shahbhai Marketing
Manager
· Osama Sayed Legal
Manager
· Jesh Kumar Procurement
Manager
· Anil Killekar Purchasing
Officer
· Sadat Ahmed Executive
Secretary
LEGAL
FORM & OWNERS
Date
of Establishment :
28/12/1409 Hijri (corresponding to 31st July 1989). Production began
in 1991
History :
Subject was established in 1989 under the name of “Saudi Formaldehyde Chemical
Company Ltd (SFCCL)”. However in March 2007, and in order to
reflect its expansion into
methanol production the subject was re-registered under the new name of
“Methanol
Chemical Company Ltd (Chemanol)”.
Legal
Form : Saudi
Joint Stock Company
Commercial
Reg. No. :
2050057828, Dammam
Chamber
Member No. : 405
Issued Capital : SR
1,206,000,000
Paid up Capital : SR
1,206,000,000
Name of Shareholder (s) Percentage
· Zamil
Group Holding Co 8.2%
· Yousef Ahmed Kanoo Co 5.8%
· Mohammad
Jalal & Sons Co 5.0%
· Members
of the general public & private investors 81.0%
AFFILIATED
COMPANIES
· United
Gulf Steel Mill Co Ltd
PO Box: 35344
Dammam
Tel: (966-13)
8343853
Fax: (966-13)
8346627
OPERATIONS
Activities: Engaged in the production of premium
grade Formaldehyde and derivative products, including Formalin, Melfores,
Paraformaldehyde and Ufores.
Subject’s current product range
comprises the following chemicals in 26 grades:
- Aqueous Formaldehyde Solutions (AF-37 /
Formalin)
-
Urea Formaldehyde Concentrate (UF-85 / Formurea)
-
Hexa Methylene Tetramine (HMT / Hexamine)
-
Paraformaldehyde (Paraform)
- Melamine & Urea Formaldehyde Resins
(Spray Dried)
-
Glazing Powder
-
Methanolic / Butanolic Solutions of Formaldehyde
-
Sulphonated Naphthalene & Melamine based Superplasticizers (SNF/SMF)
Production Capacity: 200,000 tonnes per
annum
Import Countries : Germany and the United States
of America.
Export Countries: More than 80% of its production
capacity is exported to more than 50 countries in the Middle East, Indian
Subcontinent, Africa, Europe, Asia, Australia and North America.
Subject has a workforce of approximately 530 employees.
FINANCIAL
DATA
Financial highlights provided by local sources are given
below:
Currency: Saudi Riyals (SR)
Balance Sheet 31/12/17 31/12/16
Assets
Non-current assets
Property, plant and equipment 1,715,158,354 1,779,306,402
Intangible assets 16,514,176 22,011,648
Total non-current assets 1,731,672,530 1,801,318,050
Current assets
Inventories 113,968,088 116,894,716
Trade and other receivables 170,325,659 170,489,309
Cash and cash equivalents 241,101,643 221,847,020
Total current assets 525,395,390 509,231,045
Total assets 2,257,067,920 2,310,549,095
Equity and liabilities
Equity
Share capital 1,206,000,000 1,206,000,000
Share premium 72,850,071 72,850,071
Statutory reserve 44,118,693 44,118,693
Accumulated deficit (227,551,389) (201,281,029)
Total equity 1,095,417,375 1,121,687,735
Liabilities
Non-current liabilities
Long-term borrowings 840,842,224 914,901,826
Employee benefit obligations 39,477,475 37,186,647
Total non-current liabilities 880,319,699 952,088,473
Current liabilities
Trade and other payables 89,242,890 121,827,706
Current portion of long-term borrowings 183,763,588 111,300,617
Zakat payable 8,324,368 3,644,564
Total current liabilities 281,330,846 236,772,887
Total liabilities 1,161,650,545 1,188,861,360
Total equity and liabilities 2,257,067,920 2,310,549,095
Statement of Income
Revenue 683,214,577 636,038,539
Cost of sales (550,154,984) (567,492,264)
Gross profit 133,059,593 68,546,275
Selling and distribution expenses (87,729,574) (109,491,697)
General and administrative expenses (41,731,509) (45,047,872)
Other operating income, net 16,825,616 29,435,886
Operating profit (loss) 20,424,126 (56,557,408)
Financial costs (44,532,125) (36,945,995)
Financial income 1,407,9866 -
Financial costs, net (43,124,139) (36,945,995)
Loss before Zakat (22,700,013) (93,503,403)
Zakat expense (5,000,000) (8,125,189)
Net loss for the year (27,700,013) (101,628,592)
Local sources consider subject’s financial condition to be
Poor.
BANKERS
·
National Commercial Bank
PO
Box: 13
Dammam
31411
Tel:
(966-13) 8331188
Fax:
(966-13) 8336058
·
Arab National Bank (ANB)
King
Street
PO
Box: 18
Dammam
31411
Tel:
(966-13) 8323440
Fax:
(966-13) 8337829
PAYMENT
HISTORY
Slow
GENERAL
COMMENTS
The subject and its shareholders/owners have been searched
in the following databases; Office of Foreign Assets Control (OFAC), United
Nations Security Council Sanctions, Australian Sanctions List, US Consolidated
Sanctions List, EU Financial Sanctions List and UK Financial Sanctions List and
nothing adverse could be found on the exact names listed within the report.
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.
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 67.44 |
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1 |
INR 89.89 |
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Euro |
1 |
INR 79.00 |
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UAE DH |
1 |
INR 18.44 |
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 : |
TRU |
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.