Your Reference:          HLG/DP
Total number of pages:   9

 

Subscriber no.:          1562
Our reference no.:       1755910 TL/PG
Type of report:          Standard

Enquiry on:              AK & M Trading Co Ltd
                         Unit 1702-4 Lippo Ctr Tower 2
                         89 Queensway
                         Wanchai

Report Date:             20 November 2003

REPORT ON:               AK & M Trading Company Limited
                         Unit 1702-4, Lippo Centre
                         Tower 2, 89 Queensway
                         H.K.
                         HONG KONG


CREDIT SCORE:            54 points (out of 100 possible)
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|               25|                50|    60|     70|    80|           100|
|caution          |insufficient      |fair  |normal |good  |strong        |



SUMMARY:
Founded:                 1993
Legal form:              Private Limited Company
Registration date:       19 August 1993
Activity:                Importer & Wholesaler
Main products:           Plastic Raw Materials
Staff:                   10
Paid-up capital:         3,000,000
Financial situation:     Normal
Payments:                no complaints
Litigation record:       clear

All figures in Hong Kong Dollars unless otherwise stated.

IDENTIFICATION
Frontline Subject-No.:   324336
Name:                    AK & M Trading Company Limited
                        
Business address:        Unit 1702-4, Lippo Centre
                         Tower 2, 89 Queensway
                         H.K.
                         HONG KONG

Registered office:       same as above

Phone:                   852 2511 0123

Fax:                     852 2802 2822

HISTORY AND REGISTRATION
Founding year:           1993
Legal form:              Private Limited Company
Registration date:      
19 Aug 1993
Company registry number: 445794
Bus. reg. cert.:         18266224-000
Annual return date:      19 Aug 2003
Annual return filed on:  28 Aug 2003

SHARE CAPITAL
Nominal Capital:         3,000,000 divided into
                         3,000,000 ordinary shares at 1.00
paid-up capital:         3,000,000 of which paid in cash: 3,000,000

SHAREHOLDERS AND DIRECTORS
Mitsui & Co (Hong Kong) Ltd
   25/F & 26/F, Far East Finance Ctr,
   16 Harcourt Road
   Hong Kong
                                   900,000 ordinary shares
                                   (30 % shareholding)
Mitsui & Co Ltd
   2-1 Ohtemachi 1-chome,
   Chiyoda-Ku
   Tokyo
   Japan
                                   1,200,000 ordinary shares
                                   (40 % shareholding)
Sansei Bussan Co Ltd
   Tokyotatemono Muromachi Bldg.
   3-18, 4-Chome, Muromachi,
   103-8339
   Nihonhashi, Chuo-Ku, Tokyo
   Japan
                                   450,000 ordinary shares
                                   (15 % shareholding)


Motoshige, Eiji
   2-16-10 Takaido-Nishi
   Suginami-ku,
   Tokyo 168-0071
   Japan
   Nationality: Japanese
   Passport: TF3678528
                          Director
Mitsui Bussan Plastics Co Ltd
   5F, Nextage Nishikasai Bldg.
   2-3 Nishikasai 5-Chome,
   Edogawa-Ku, Tokyo
   JAPAN
                                   450,000 ordinary shares
                                   (15 % shareholding)
Aoki, Takashi
   2-2-13, Higashiohi 4-Chome
   Shinagawa-Ku
   Tokyo 104-0011
   Japan
   Passport: TZ0117755
                          Director
Ikegami, Toshiyuki
   D-905, 3-27, Nakadai, Itabashi-Ku
   Tokyo, 171-0064
   Japan
   Passport: TZ0106157
                          Director
Nakayama, Koichi
   Flat J2, 26/F, Blk J, Beverly Hill
   6 Broadwood Road
   Happy Valley
   Hong Kong
   Nationality: Japanese
   ID-No.: P830390(1)
                          Director
Ogawa, Hideo
   10-9, 5 Chome
   Yagisawa, Hoya-shi
   Tokyo 202-0022 
   Japan
   Passport: MO4109482
                          Director

Total no.of shareholders: 4


Former shareholder and director records:

Anai Michihiko resigned as Director of the company with effect from 01 November 1999.


MANAGEMENT
Chan, Kin Shing, Timmy, Admin. & Account Manager
He is active in subject's daily operation.



Management Assessment
Subject is a relatively small entity.  There is simple division of management functions and responsibilities evident.  One or two key figures are responsible for overall field of management.


GENERAL
ACTIVITY
Nature of business:      Importer & Wholesaler
Main product:            Plastic Raw Materials

Subject is engaged in the importing and wholesaling of plastic raw materials. All the materials are imported from its group company in
Japan, and then wholesaled in Hong Kong to toys factory.

 
Basic traffic of phone calls, deliveries of documents, goods and visitors indicates that subject is performing barely adequate level of daily business activities with little functional divisions and business structures.   Operations are observed to be simply organized with minimal number of staff. The staff seems to be not busy.


PURCHASES
Imports:                 100%
Terms imports:           internal payment, open account
Import countries:        Japan

MARKETS
Type of clients:         Manufacturers (Toys)
Local HK sales:          100%
Terms local HK sales:    open account 60 days

NACE-Code:
     5155   Wholesale of chemical products

PREMISES
Type of premises:        office
Size sq/ft:              2,000
Area:                    Commercial
Condition:               Modern
Equipment:               Properly equipped and maintained

The premises are shared with other companies, including "New Materials Asia Ltd", "Nippon Kagaku Yakin Co Ltd".

 
Very good transportation network.  Located in modern commercial building in commercial centre.
Reasonable office decoration observed.
Captioned premises are computerized with enough work stations and very spacious. There are also some basic office facilities (tel & fax, photocopiers, furniture, meeting rooms etc)


STAFF
Staff in Hong Kong:      10
                         Staff is shared with related concern
Total group:             9564 (Group)

IMPORTANCE               Small company
                         
AFFILIATION
      Shareholder (30%): MITSUI & COMPANY (HONG KONG) LIMITED
                         Legal Form: Private Limited Company
                         Comp.Reg.Num: 046776
                         Bus.Reg.Cert.Num: 04673306
                         Registration Date: 26/3/1976
                         Paid-up capital: 200,000,000
                         Activity: Importer  Exporter
                         Main products: General Merchandises
                         Staff: 150
                         Credit Score: 69 points (as of 3/6/2003)
                         Turnover: 3,164.57 Mio
                         Shareholder Funds: 691.01 Mio
                         Other Participation:
                           ALTA MODA INTERNATIONAL LIMITED  (70 %)
                           CHILING STEEL LIMITED  (25 %)
                           TAKUMI TRADING (H.K.) COMPANY  LIMITED (19 %)
                           PING SHAN NUTRIVET (CHINA) CO., LIMITED (10 %)

      Shareholder (40%): MITSUI & CO. LTD.
                         JAPAN
                         Other Participation:
                           MITSUI OIL (ASIA) HONG KONG LIMITED  (100 %)
                           DAIRU INDUSTRIES LIMITED  (98.9 %)
                           PING SHAN NUTRIVET (CHINA) CO., LIMITED (30 %)

      Participation:     Mitsui & Co. Ltd.
                         JAPAN

      Participation:     Sansei Bussan Co. Limited
                         JAPAN

      Participation:     Mitsui Bussan Plastics Co Ltd
                         JAPAN

      Related company:   New Materials Asia Ltd

      Related company:   Nippon Kagaka Yakin Co Ltd
                         same address


      Participation:     Mitsui & Company (Hong Kong)
                         Limited
                         25-26/F, Far East Finance Centre,
                         16 Harcourt Road,
                         Central,  H.K.
                         Legal Form: Private Limited Company
                         Comp.Reg.Num: 046776
                         Bus.Reg.Cert.Num: 04673306
                         Registration Date: 26/3/1976
                         Paid-up capital: 200,000,000
                         Activity: Importer  Exporter
                         Main products: General Merchandises
                         Staff: 150
                         Turnover: 3,164.57 Mio
                         Shareholder Funds: 691.01 Mio
                         Credit Score: 69 points  (as of 3/6/2003)




Mitsui & Co. Ltd
Mitsui & Co Ltd is engaged in the general trading and providing business engineering services.
Its business can be divided into various segments: metals products and minerals, machinery, electronics & information, chemical, energy, consumer products and services
With 28 office in Japan, 74 overseas offices and 93 overseas offices over 85 countries


FINANCE
Financial situation:     Normal
Status of company:       Active
Trend:                   Steady
 
Direct Interview:        Ms. Poon (Account Clerk) on 19 Nov 2003
Financial data:          Financial data on subject not available, only on

                         parent/group

Financials of Mitsui & Co. Ltd.  (consolidated)
Currency = YEN
                            31 Mar 2003     31 Mar 2002     31 Mar 2001
   Turnover:                569,802 Mio     546,549 Mio                
   Gross Profit:                            554,120 Mio     572,137 Mio
   Pretax Profit:            62,409 Mio      63,573 Mio      79,625 Mio
   Profit after Tax:         31,138 Mio      55,371 Mio      51,588 Mio
   Tangible assets:         570,927 Mio     585,441 Mio                
   Investments:           1,884,766 Mio   2,137,770 Mio                
   Stocks:                  488,672 Mio     485,147 Mio     487,911 Mio
   Accounts receivable:   1,589,379 Mio   1,560,041 Mio                
   Cash & near-cash:        660,216 Mio     607,987 Mio     705,331 Mio
   Other current assets:                    188,194 Mio     169,976 Mio
   Total current assets:  3,831,744 Mio   3,783,757 Mio   3,981,098 Mio
   Total assets:          6,540,520 Mio   6,668,366 Mio   6,710,107 Mio
   Trade creditors:       1,417,472 Mio   1,407,512 Mio                
   Other current liabs.:                    142,195 Mio     100,155 Mio
   Total current liabs.:  3,025,330 Mio   2,986,676 Mio   2,996,554 Mio
   Share capital:           192,487 Mio     192,487 Mio                
   Shareholders' Funds:     862,147 Mio     914,970 Mio     834,427 Mio

                            31 Mar 2000                               
   Gross Profit:            537,867 Mio                                
   Pretax Profit:            51,457 Mio                                
   Profit after Tax:         34,837 Mio                                 
   Stocks:                  415,070 Mio                                
   Cash & near-cash:        732,125 Mio                                
   Other current assets:    177,301 Mio                                
   Total current assets:  3,881,845 Mio                                
   Other current liabs.:     80,005 Mio                                
   Total current liabs.:  3,105,983 Mio                                
   Shareholders' Funds:     795,852 Mio         


 

Group Financial analysis
Sales analysis
The group for the year in core business areas was encouraging, particularly in their Energy and Metal Products & Minerals segments. This was reflected in higher year on year results at a number of levels. Revenue-gross trading profit rose ¥23.3 billion, to ¥569.8 billion, and Earning Power* also increased, up 7.1%, to ¥138.8 billion. This rise in Earning Power resulted from strong earnings generated from prior investments in energy and metals projects, a recovery in the chemicals market, and a strong performance in motor vehicles.

Profit analysis
Net income for the year decreased ¥24.2 billion, to ¥31.1 billion. This was primarily because in the year under review they reappraised their assets to reflect the value in the current and foreseeable economic environment.

Liquidity
Current Ratio:
2003:1.26times
2002:1.26times
It maintains stable current ration in these two years. The ratio is bigger than 1. That means the amount of it current assets is enough to cover its current asset. In general , the bigger the ratio, the better the liquidity it is. However, it may also indicate the inefficient investment in current asset.

Industry Trend
Followed by some double-digit decrease in 2001, the situation has completely reversed in 2002. Both imports and exports increased by 10%. This up-going trend persists in the first two months of 2003 in which imports and exports increase by 28% and 21% respectively. Asian countries such as
Taiwan, Japan, Korea, Thailand and China dominate HK imports. Nevertheless, American resins still excel in quality. As a result, American exporters have a distinct advantage in engineering plastics. In plastic raw materials industry, price and quality are the two determining factors for the choice of resins.


Real estate:             premises at business address are rented

Registered charges:      none in current years

Banker:                  UFJ Bank Ltd

Payments:                no complaints
                        
Litigation records:              clear
on subject:                      clear
on Mitsui & Co (
Hong Kong) Ltd:  clear
Negative file check:             clear

 
Conclusive Remark
Subject is considered good for limited credit.  Normal business is carried out with necessary resources.  Subject is capable of meeting usual daily commitments.  But sensitive to unfavorable conditions which may cause financial difficulties.  Unsecured credit should only be granted in small amount with regular monitoring.


INDUSTRIAL STATISTICS*

HONG KONG'S TOTAL IMPORTS & EXPORTS OF PLASTIC RAW MATERIALS (SITC 57, 58)


 

 

2001

2002

Jan-Feb, 2003

HK $ Million

Growth %

HK $ Million

Growth %

HK $ Million

Growth %

TOTAL IMPORT

44,525

-18

49,113              

+10

8,228  

+28

TOTAL EXPORT

38,930

-14

42,980              

+10

6,788   

+21

 

TOTAL IMPORT BY MAJOR MARKET

 

 

 

2001

2002

Jan-Feb, 2003

Share %

HK $ Mio

Share %

HK $ Mio

Growth %

Share %

HK $ Mio

Growth %

TAIWAN

20.8

9,272

21.1

10,340              

+12

19.8    

1,628   

+25

JAPAN

17.0

7,562

17.6

8,648              

+14

17.2    

1,415   

+18

KOREA REP

11.0

4,913

11.4

5,619              

+14

12.9    

1,058   

+36

USA

10.2

4,540

8.9

4,377                

-4

9.0    

742

+22

THAILAND

7.5

3,338

7.5

3,707                

+11

8.7    

715

+63

CHINA

9.1

4,054

9.3

4,565                

  +13

8.8    

723

+15

SINGAPORE

4.4

1,966

4.7

2,325                

+18

5.1    

421    

+43

 

TOTAL EXPORT BY MAJOR MARKET

 

 

 

2001

2002

Jan-Feb, 2003

Share %

HK $ Mio

Share %

HK $ Mio

Growth %

Share %

HK $ Mio

Growth %

CHINA

95.8

37,284

96.3

41,386              

+11

96.6    

6,555   

+22

TAIWAN

0.9

342

0.7

301 

-12

0.4     

31

-1

JAPAN

0.3

133

0.3

110                 

-17

0.3    

17 

+14

USA

0.3

121

0.5

206 

+70

0.5    

33

+39

KOREA REP

0.3

119

0.3

117 

-2

0.3     

17

-13

THAILAND

0.4

171

0.4

180

+5

0.4     

26

+3

PHILIPPINES

0.2