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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

ABC PTE LTD

Singapore

D-U-N-S: XX-XXX-XXXX

Dun & Bradstreet (Singapore) Pte Ltd

6 Shenton Way

#17-10 OUE Downtown 2

Singapore 068809

T : (+65) 6565 6161

F : (+65) 6226 0178

E: csc@dnb.com.sg

www.dnb.com.sg

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

ABC PTE LTD xxx, Singapore 368088 Tel : (65) XXX

Fax : (65) XXX Web Site : www.XXX.com

Executive Summary

D&B D-U-N-S : XX-XXX-XXXX

Registration Date : DD.MM.YYY

Registration Number : XXXXXXXXXX

Legal Form : Limited Private Company

Chief Executive : Mr. XXX

Staff Strength : 5

Paid Up Ordinary : SGD1,000,000.00

Line of Business : Engaged in wholesales of electronics and

electrical components

SIC Code : 5065

Auditor : Alpes Assurance LLP

Banker (s) : BTMU; SMBC

Corporate Profile

SC was established on DD MM YYY as a Limited Private Company* under the name

style of ABC Pte Ltd. The company is registered with the Accounting and Corporate

Regulatory Authority (ACRA) under the registration number, XXXXXXXXXX.

SC is engaged in wholesales of electronics and electrical components. An

establishment of about 23 years, SC has been in this line of business since the

commencement of its business operations.

SC’s registered office address is XXX, Singapore 368088 and this is the company's

current operating address. This premise houses SC’s sales cum administrative

office and operation facilities.

As of January 2018, SC’s capital stands as follows:

Currency Amount Number of Shares

Issued Ordinary SGD 1,000,000.00 1,000,000

Paid-up Ordinary SGD 1,000,000.00 -

Credit Rating

CA3

D&B Rating

1A3

New Credit Risk Index

RI 2

(Please refer to Appendix)

Credit Risk Average Payment Above Average RECOMM. CREDIT RANGE SGD50,000 to SGD100,000 Financial Condition Fair Operational Trend Average General Reputation Average Legal Status Limited Private Company

A private company is one which has

a small group of shareholders.

Under the law, this group cannot be

more than 50 people. A private

company cannot ask the public to

invest in it or to deposit money with

it. Capital must be raised privately from among the small group of

shareholders and through bank

loans.

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Shareholder’s Information

Details of Shareholder:

1 Name : XXX

Registration Number : XXXX

Place of Origin : Japan

Number of Shares : 1,000,000

Board of Directors:

1 Name : A

IC/Passport : XXX

Nationality : Japanese

Address : 2-1-1-805 Hiratsuka, Shinagawa-Ku

Tokyo 142-0051, Japan

Date of Appointment : 20.09.2006

Position : Director

2 Name : B

IC/Passport : XXX

Nationality : Japanese

Address : 48 Mactaggart Road

#10-03

Singapore 368088

Date of Appointment : 23.10.2007 / 01.04.2012

Position : Director / Managing Director

3 Name : C

IC/Passport : XXX

Nationality : Japanese

Address : 801, 2-23-15, Edogawa

Edogawa Ward

Tokyo, Japan

Date of Appointment : 04.04.2009

Position : Director

4 Name : D

IC/Passport : XXX

Nationality : Malaysian

Address : 19 Keppel Road

#03-01, Jit Poh Building

Singapore 089058

Date of Appointment : 01.11.2015

Position : Secretary

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Key Personnel

Heading the management is the Managing Director, Mr. XXX. He is the overall in

charge of SC’s daily business operations.

Checks revealed that apart from SC, Mr. XXX does not have directorship and

shareholdings in any other Singapore registered company.

Assisting Mr. XXX in the running of the day-to-day operations of the company is a

group of personnel.

According to checks, SC has a staff strength of 5 assisting in the daily operations

of the company.

Current Investigation

On 4th January 2018, SC confirmed all information in this report. The rest of the

information is obtained from public sources.

Staff Strength 5

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Business Operations

On 4th January 2018, the Management confirmed all information about the

company business operations citing confidentiality. The information below was

obtained from external sources.

SC is engaged in wholesales of electronics and electrical components. Established

since YYYY, SC has approximately 23 years of experience in this line of business.

Checks revealed that SC is a wholly-owned subsidiary of XXX, a company

incorporated in Japan.

External sources revealed that the group offer some of the following products:

· PC, peripheral equipment, PDP, LCD projectors

· FPGA

· S-RAM

· Capacitors

· Thristers, triacs, diodes

· CF card for industry, Memory module

· Amplifier

· Oscillator

· Microwave, Milliwave Components

· Coaxial & Waveguide Components

· Coupler

The management revealed that SC’s procurements are sourced from local

suppliers as well as imported from overseas suppliers. Current investigation

revealed that 10% of its suppliers are based locally whilst the remaining 90% are

based in:

· China

· India

In its business transactions, SC is granted Telegraphic Transfers, Cheque and 30

days to 120 days for its purchase.

The management further revealed that 10% of the company’s products are sold to

local clients whilst the remaining 90% are exported to overseas clients based in

· Australia

· Europe Region

In its business transactions, SC usually grants 30 days credit term to its clients.

Operations Rating 3 Obtained Scores

65

Rating Guide

Rating

Key

Scores Implications

1 85–100 Excellent

2 75 – 84 Above Average 3 50 – 74 Average

4 35 – 49 Fair

5 15 – 34 Below Average 6 01 – 14 Poor

NR No Data No Data

Purchasing Terms Local & Overseas – T/T, Cheque, 30-120 days

Selling Terms Local & Overseas- 30 days

Clientele Base Local – 10% Overseas – 90%

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Related Companies

Immediate Holding Company:

XXX, Japan

Litigation

Litigation searches conducted based on registration number(s) and/or

Identification number(s) of SC and its shareholder(s) showed that there were no

legal suits filed against them in the last five years.

Litigation information is provided to D&B Singapore by a third party and may or may not reflect the status

and details as at the time of original filing. As such, D&B Singapore is unable to guarantee its accuracy,

completeness or currentness and shall not be liable for any damage or loss that may be caused as a result

of any error, omission or reliance on the information.

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This report is forwarded to the Subscriber in strict confidence for use by the Subscriber as one factor in connection with credit and other business

decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Payment

The rating indicates the payment pattern of SC based upon D&B Singapore

Payment Database, comments from suppliers of SC as well as industrial sources.

Payment Information Extracted from our Database

Date Paying Record

Terms Usually

Pays

Maximum Outstanding (Local Curr)

Current Balance (Local Curr)

Beyond Terms (Local Curr)

30 Nov 2017 PROMPT Net 30 100 50 0

31 Oct 2017 PROMPT Net 30 100 50 0

30 Sep 2017 PROMPT Net 14 100 50 0

31 Aug 2017 PROMPT Net 30 100 50 0

31 Jul 2017 PROMPT Net 30 100 50 0

31 Jul 2017 PROMPT Net 30 250 250 0

30 Jun 2017 PROMPT Net 30 100 50 0

31 May 2017 PROMPT Net 30 100 50 0

30 Apr 2017 PROMPT/SLOW Net 30 90 100 100 50

31 Mar 2017 PROMPT Net 14 100 50 0

28 Feb 2017 PROMPT Net 30 100 50 0

31 Jan 2017 PROMPT Net 30 100 50 0

31 Jan 2017 SLOW Net 7 30/30 500 500 500

Amounts may be rounded to nearest figure in prescribed ranges

Note: In some instances, payment beyond terms can be the result of disputes over

merchandise, lost invoices, etc. The “Payment”, “Default” and “Collection” data

and/or information may be overlap. Subscriber is required to seek for clarification

in the event of doubt and notify with full details to clarify that SC has already

made payment, or dispute the debt for any reason.

Banking

· The Bank Of Tokyo-Mitsubishi UFJ, Ltd,

· Sumitomo Mitsui Banking Corporation

Charge(s) : Nil

Payment Rating 2 Obtained Scores 86

Rating Guide

Rating

Key

Scores Implications

1 91–100 Excellent

2 80 – 90 Above Average 3 70 – 79 Average

4 50 – 69 Fair

5 30 – 49 Below Average 6 21 – 29 Poor

NR No Data No Data

The rating indicates the payment pattern of SC based upon the D&B Singapore

Payment Database, comments from

suppliers of SC as well as industrial

sources.

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

TWO YEAR FINANCIAL ANALYSIS REPORT

Financial Highlights

SC experienced a deteriorating turnover performance in FYE2017. This was

followed by net losses. SC realized net losses worth USD73,003 in FYE2017,

posting net loss margin of 1.21%. Therefore, accumulated profits reduced in

FYE2017. This in turn reduced total shareholder’s equity during the end of

FYE2017. The net loss margin registered meant that SC was unprofitable for the

year. SC failed to generate returns on assets and equity in FYE2017.

Liquidity position deteriorated in current financial year, registering performance

above the industry norm. Working capital surplus has decreased but SC remained

solvent in generating current assets to cover current debt obligations in FYE2017.

The cash flow statement shows that the company was sufficient to cover its cash

outflows from operating and investing activities with the cash inflow from its

financing activities.

Total debt to equity increased, posting at 103.96% in FYE2017, which remained

higher than the industry norm of 81.71%. SC has switched to rely on more debt

than equity to finance its operations during FYE2017.

We would like to highlight that the company had total bank borrowings totaling of

USD0.85 million in FYE2017 as compared to USD0.64 million in FYE2016.

According to its audited financials for FYE2017, the borrowings were unsecured.

Taking into consideration profitability, liquidity and leverage, the company has

shown a fair financial performance.

Table 1: Key Balance Sheet Data (USD)

March 2017 2016 % Changes

Current Assets 2,634,869 2,485,706 6.00 Other Assets - - - Fixed Assets 20,107 27,599 (27.15) Total Assets 2,654,976 2,513,305 5.64 Current Liabilities 1,353,274 1,060,337 27.63 Non-Current Liabilities - 78,263 - Total Liabilities 1,353,274 1,138,600 18.85 Working Capital 1,281,595 1,425,369 (10.09) Share Capital 590,698 590,698 - Accumulated Profit (Loss) 711,004 784,007 (9.31) Total Shareholder's Equity 1,301,702 1,374,705 (5.31) - The figure is not available.

Financial Rating

FR 4

Auditor Alpes Assurance LLP. Financial Statement Type Company

Fiscal Year 31 March 2016 to 2017 Currency USD

Financial Rating Guide

FR1 Strong

FR2 Above Average

FR3 Average FR4 Fair

FR5 Below Average

FR6 Poor

NR No Rating

This rating serves as a reference to

assess SC’s financial performance.

The financial rating assigned to SC takes into account of the following

considerations: Profitability, Return

on Invested Capital, Liquidity, Asset

Management and Capital Structure

and Solvency.

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Table 2: Key Earnings Data (USD)

March 2017 2016 % Changes

Turnover 6,036,464 6,631,840 (8.98) Profit (Loss) Before Tax (75,881) 27,735 (373.59) Income Tax 2,878 (4,111) 170.01 Profit (Loss) After Tax (73,003) 23,624 (409.02) Accumulated Profit (Loss) B/Forward 784,007 760,383 3.11 Accumulated Profit (Loss) C/Forward 711,004 784,007 (9.31) - The figure is not available.

Table 3: Key Cash Flow Data (USD)

March 2017 2016 % Changes

Net Cash Flow from Operating Activities (110,057) (345,643) 68.16 Net Cash Flow from Investing Activities (5,878) (6,521) 9.86 Net Cash Flow from Financing Activities 192,145 (107,928) 278.03 Net Increase (Decrease) in Cash and Cash Equivalents 76,210 (460,092) 116.56 Cash and Cash Equivalents B/Forward 208,958 669,050 (68.77) Cash and Cash Equivalents C/Forward 285,168 208,958 36.47 - The figure is not available.

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Table 4: Key Financial Ratios

March Industry Norms† 2017 2016

Lower Median Upper Profitability Gross Profit (Loss) Margin (%) Gross Earnings/Turnover*100% - - - 8.41 9.39 Pre-tax Profit (Loss) Margin (%) Pre-tax Earnings/Turnover*100% - - - -1.26 0.42 Net Profit (Loss) Margin (%) Net Earnings/Turnover*100% - - - -1.21 0.36 Basic Earning Power (%) Earnings Before Interest & Tax/Net

Assets*100% - - - -4.50 2.72 Earnings Per Share (USD) Net Earnings/No. of Shares Outstanding - - - -0.07 0.02

Return on Invested Capital

Return on Assets (%) Net Earnings/Total Assets*100% 0.67 3.22 9.33 -2.75 0.94 Return on Equity (%) Net Earnings/Total Equity*100% 2.01 10.63 25.89 -5.61 1.72 Liquidity Current Ratio Current Assets/Current Liabilities 1.16 1.75 3.08 1.95 2.34 Quick Ratio (Current Assets - Inventories)/Current

Liabilities - - - 1.64 1.93 Cash Ratio Cash/Current Assets - - - 0.11 0.08 Collection Period (days) Accounts Receivable/Turnover*365 83.11 58.50 40.35 102.95 87.41 Payment Period (days) Accounts Payable/COS*365 - - - 27.81 24.20 Inventory Conversion Period (days) Inventory/Turnover*365 - - - 25.37 24.19 Operating Efficiency Fixed Asset Turnover Ratio (times) Turnover/Fixed Assets - - - 300.22 240.29 Asset Turnover Ratio (times) Turnover/Total Assets - - - 2.27 2.64 Accounts Receivable Turnover Ratio (times) Turnover/Accounts Receivable - - - 3.55 4.18 Accounts Payable Turnover Ratio (times) COS/Accounts Payable - - - 13.13 15.08 Inventory Turnover Ratio (times) Turnover/Inventory 6.05 12.14 25.68 14.39 15.09

Leverage Total Debt to Asset Ratio (%) Total Liabilities/Total Assets*100% - - - 50.97 45.30 Total Debt to Equity Ratio (%) Total Liabilities/Total Equity*100% 233.50 81.71 24.20 103.96 82.83 Non-Current Debt to Equity Ratio (%) Non-Current Liabilities/Total Equity*100% - - - - 5.69 Total Bank Borrowings to Equity Ratio (%) Total Bank Borrowings/Total Equity*100% - - - 64.92 46.19 Current Bank Borrowings Coverage Ratio Net Earnings/Current Bank Borrowings - - - -0.09 0.04 Interest Coverage Ratio Earnings Before Interest & Tax/Interest

Expense - - - -3.38 3.88

- The figure is not available.

†The Industry Norms are calculated solely based on the information available in the database of Dun & Bradstreet (Singapore) Pte Ltd and may not be reflective of

Industry Averages. Dun & Bradstreet (Singapore) Pte Ltd reserves the right to vary the data fields and/or exclude any data element in the report at discretion.

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Profitability

Chart 1: Comparative Performance of Turnover, Earnings and Total Shareholder’s Equity

SC’s turnover decreased by 8.98% to USD6.04 million in FYE2017. Turnover

represented revenue from sale of goods.

Aside from turnover, SC has posted other operating income amounting to

USD11,343 in FYE2017 as compared to USD19,299 in FYE2016.

Cost of sales reduced by 8.00% to USD5.53 million in the current year. SC was

able to cover the cost of sales with the revenue generated but registered lower

gross profit of USD0.51 million in current year from USD0.62 million in the

previous year.

Meanwhile, total operating expenses decreased by 4.44% to USD0.58 million in

the FYE2017. The decreases in selling and distribution costs, administrative

expenses, other charges led to the overall decrement in total operating expenses

in FYE2017.

Net losses realized at USD73,003 in FYE2017, representing a dip of 409.02% from

previous financial year's profits. On top of poorer sales performance, the

realization of net losses was also result of SC’s inability to control costs.

Hence, accumulated profits reduced by 9.31% to USD0.71 million in FYE2017. This

in turn has translated into contracted total shareholder’s equity, which depreciated

by 5.31% to USD1.30 million in FYE2017.

Profitability

Lower turnover and earnings turned to the red, reduced accumulated profits, depreciation of shareholders' equity Unprofitable in FYE2017 due to inability to control costs

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Chart 2: Analysis of Profit (Loss) Margin Ratios

Gross profit margin has decreased by 0.98% points to 8.41% in FYE2017.

Meanwhile, both pre-tax loss and net loss margins were reported at 1.26% and

1.21% respectively in FYE2017. This implies that SC was unprofitable during the

current financial year.

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Return on Invested Capital

Chart 3: Comparative Changes in Return on Assets Ratio and Return on Equity Ratio

Following the realization of losses, Return on Assets ratio (ROA) and Return on

Equity ratio (ROE) reported negative results during the year.

Return on Assets ratio (ROA) realized at a negative 2.75% in FYE2017 implying

that the company was making losses of USD2.75 for every USD100 worth of

assets.

Return on Equity ratio (ROE) realized at negative 5.61% in FYE2011. In other

words, the company incurred losses of USD5.61 for every USD100 equity invested

into the business.

Basically, the ROE measures the management’s capability in generating returns on

its shareholders’ funds and based on the negative ROE in FYE2017, it appeared

that the management was inefficient in giving its shareholders returns during the

current financial year.

Return on Invested Capital Negative ROA and ROE during the year

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Liquidity

Chart 4: Comparative Changes in Current Ratio and Quick Ratio

Current ratio dropped by 0.39 from 2.34 in FYE2016 to 1.95 in FYE2017. Quick

ratio also showed decrement, decreasing by 0.29 to 1.64 in FYE2017. The

decrease in both ratios was largely attributed to a larger increasing current

liabilities position, whereby it rose by 27.63% as compared to a 6.00% rise in

current assets in FYE2017. Overall, SC's liquidity position remained above the

industry norm of 1.75.

Working capital surplus has reduced by 10.09%, registering at USD1.28 million in

FYE2017. Nonetheless, the surplus suggests that the company remained solvent

with sufficient current assets to cover current debt obligations in the event of

liquidation.

SC's cash position increased by 36.47% to USD0.29 million in FYE2017. This was

due to the sufficient amount of cash generated from financing activities to cover

its cash outflows from operating and investing activities.

SC has realized net cash outflow from operating activities of USD0.11 million in

FYE2017, a 68.16% contracted from previous financial year. This was contributed

by the decrease in trade and other receivables.. On the other hand, cash

expenditure in investing activities reduced by 9.86% to USD5,878 in FYE2017.

This was contributed by the decrease in purchase of property, plant and

equipment.. Meanwhile, net cash outflow from financing activities turned around

by 278.03% to inflow of USD0.19 million in FYE2017. This was contributed by the

proceeds from interest bearing loans..

As such, net cash deficit in FYE2016 rebounded to surplus of USD76,210 during

the current financial year.

Liquidity

Deteriorated liquidity position and SC’s current ratio remained above the industry norm of 1.75 Net cash surplus registered

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Chart 5: Analysis of Collection, Payment and Inventory Conversion Periods

Inventory conversion period increased from 24.19 days in FYE2016 to 25.37 days

in FYE2017, implying that it took a longer time for the company to turn its stocks

into sales. We noticed that SC has maintained a lower level of inventory at the end

of FYE2017 of USD0.42 million, which was a decrease of 4.53%.

Payment period increased to 27.81 days in FYE2017 from 24.20 days in FYE2016.

We noticed that trade creditors has increased by 5.71% in FYE2017 on the back of

drop in the cost of sales.

Collection period lengthened from 87.41 days in FYE2016 to 102.95 days in

FYE2017. This implies that the company was less efficient in its collection from

customers. Note that SC's collection period remained longer than industry norm of

58.50 days.

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Asset Management

Chart 6: Comparative Changes in Asset, Accounts Receivable and Payable, Inventory and Fixed Asset

Turnover Ratios

Asset turnover ratio decreased to 2.27 times, while fixed assets turnover ratio

increased to 300.22 times in FYE2017. Total asset level increased by 5.64% on the

back of drop in SC’s turnover. Note that increase in current assets have triggered

an overall increment in total asset in FYE2017. All in all, the company remained

efficient in capitalizing on its assets to generate returns.

Accounts receivable and accounts payable turnovers ratios moved in tandem for

three financial years under review. The lower accounts receivable turnover ratio of

3.55 times reinforced that SC was slower in the recovery of its debts from trade

debtors. Accounts payable turnover ratio dropped to 13.13 times, showing that SC

took a longer period to pay its trade creditors (See section on Liquidity).

Inventory turnover ratio fell to 14.39 times in FYE2017 from 15.09 times in

FYE2016. Note that SC's inventory turnover ratio remained above the industry

norm of 12.14 times.

Asset Management

Efficient in the management of its overall assets

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Leverage

Chart 7: Comparative Changes in Total Debt to Asset Ratio and Total Debt to Equity Ratio

Total debt to asset ratio increased by 5.67% points from 45.30% in FYE2016 to

50.97% in FYE2017. This implies that SC has switched to rely on more debt than

equity to finance its operations during FYE2017.

Total debt to equity enlarged, posted at 103.96% in FYE2017 as compared to

82.83% in FYE2016. SC’s total debt to equity ratio was higher than the industry

norm of 81.71%.

We would like to highlight that the company had total bank borrowings totaling of

USD0.85 million in FYE2017 as compared to USD0.64 million in FYE2016.

According to its audited financials for FYE2017, the borrowings were unsecured.

Leverage Leverage level was higher and remained higher than the industry norm, higher bank borrowings

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This report is forwarded to the Subscriber in strict confidence for use by the Subscriber as one factor in connection with credit and other business

decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Industry Information

The wholesale & retail trade sector grew by 2.2 per cent in the third quarter,

extending the 2.1 per cent growth in the previous quarter. Growth was supported

by both the wholesale trade and retail trade segments.

The wholesale trade segment was boosted by expansions in both domestic and

foreign wholesale trade sales volumes (Exhibit 1). The domestic wholesale trade

index rose by 1.3 per cent in the third quarter, following an increase of 6.3 per

cent in the previous quarter, on the back of expansions in the sales of petroleum &

petroleum-related products (3.0 per cent) and others1 (11 per cent).

Exhibit 1: Changes in Wholesale Trade Index at Constant Prices

Meanwhile, the foreign wholesale trade index expanded by 4.6 per cent in the

third quarter, faster than the 1.9 per cent growth in the second quarter. The

improved performance of the index can be mainly attributed to a turnaround in the

sales of petroleum & petroleum-related products. Specifically, the sales of

petroleum & petroleum-related products expanded by 5.3 per cent in the third

quarter, a reversal from the decline of 4.2 per cent in the second quarter.

Additionally, robust expansions in the sales of electronic components (15 per cent)

and food, beverages & tobacco (19 per cent) further lent support to growth.

Overall retail sales volume rose by 0.9 per cent in the third quarter, extending the

1.4 per cent growth in the previous quarter, supported by a sustained recovery in

non-motor vehicle sales (Exhibit 2). Notably, retail sales volume (excluding motor

vehicles) expanded by 2.4 per cent in the third quarter, similar to the 2.5 per cent

increase in the previous quarter. The improvement in non-motor vehicle sales

came on the back of an uptick in consumer sentiments as well as higher tourist

expenditure on shopping. In particular, the sales volume of department stores,

watches & jewellery, and wearing apparel & footwear rose by 4.6 per cent, 4.5 per

cent and 4.1 per cent respectively.

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Exhibit 2: Changes in Retail Sales Index at Constant Prices

Source: Ministry of Trade and Industry

November 2017

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Remarks

In conclusion, taking into consideration of SC’s general performance, reputation as

well as market conditions we would rate SC as an average credit risk company.

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This report is forwarded to the Subscriber in strict confidence for use by the Subscriber as one factor in connection with credit and other business

decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Appendix Credit Rating Guide

RATING KEY CREDIT RISK ASSESSMENT PROPOSED CREDIT LIMIT

(in concerned business field)

CA1 Minimal Credit can proceed with favorable

terms Large amount

CA2 Low Credit can proceed promptly Fairly large amount

CA3 Average Credit can proceed normally Moderate amount

CA4 Above average Credit should proceed with monitor Small amount – periodical review

CA5 Fairly High Credit should be extended under guarantee

C.O.D. To small amount

CA6 High Credit is not recommended C.O.D.

NR Assessment not

conducted Insufficient data available No recommendation

This rating 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 and their relative weights (as indicated through %) in our credit analysis are

as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (20%) Market trend (5%) Operational size (5%)

In case of unlimited companies, newly established companies, or lack of financial data, more weight is given to ‘Ownership background’ and ‘Payment record’ in our analysis.

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DISCLAIMER: THIS REPORT MAY NOT BE REPRODUCED IN WHOLE OR IN PART IN ANY FORM OR MANNER WHATSOEVER.

This report is forwarded to the Subscriber in strict confidence for use by the Subscriber as one factor in connection with credit and other business

decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

D&B Rating Glossary

D&B Risk Indicators

Risk

Indicator

Level of Risk Guide to Interpretation

4 Significant level of risk Take suitable assurances before extending credit

3 Greater than average

risk

Proceed with transaction but monitor closely

2 Low risk Proceed with transaction

1 Minimal risk Proceed with transaction – offer terms required

- Insufficient information

to assign a risk indicator

No public information or D&B proprietary information available to

indicate trading activity

D&B Financial Strength Indicators

The Financial Strength Indicator is based on Net Worth (alternatively, Paid Up Capital). The table

below contains the possible values.

Paid Up Capital Net Worth From To

5AA 5A SGD 90,000,000 And above

4AA 4A SGD 20,000,000 SGD 89,999,999

3AA 3A SGD 4,000,000 SGD 19,999,999

2AA 2A SGD 2,000,000 SGD 3,999,999

1AA 1A SGD 1,000,000 SGD 1,999,999

AA A SGD 900,000 SGD 999,999

BB B SGD 800,000 SGD 899,999

CC C SGD 700,000 SGD 799,999

DD D SGD 600,000 SGD 699,999

EE E SGD 500,000 SGD 599,999

FF F SGD 300,000 SGD 499,999

GG G SGD 100,000 SGD 299,999

HH H 0 SGD 99,999

Alternate Ratings Used

N Financial Strength is negative

O Financial Strength is undisclosed

NB New Business: Less than 24 months

NQ Ceased Trading

FB Foreign Branch

Note: D&B Rating and CRI are valid for a period of 12 months subject to no changes in company’s

activity. All Information contained in D&B report is obtained by D&B from the rated subject and third

party sources. Although reasonable care has been taken to ensure that the information in the Report is

true, such information is provided ‘as is’ without any warranty of any kind and D&B, in particular, makes no representation or warranty, express or implied, as to accuracy, timeliness or completeness of any such

information. In providing this Rating and CRI, D&B does not underwrite the risks of any third party or that

of the subject.

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This report is forwarded to the Subscriber in strict confidence for use by the Subscriber as one factor in connection with credit and other business

decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Financial Ratio Glossary

Key Business Ratios are used to identify irregularities in the status and future potential of a company.

Name Formula Explanation

Current

Ratio (x)

Total Current Assets /

Total Current

Liabilities

This ratio shows the cover by current assets of short term creditors,

and the higher the ratio the more assurance there is that payment of

creditors can be met.

Asset

Turnover (%)

(Turnover / Total

Assets(including Intangibles)) x 100

This ratio measures how efficient the company's management has been

in generating sales from the assets at its disposal.

The measure can vary considerably from industry to industry and

should therefore be judged according to the industry norm.

Profit Margin

(%)

(Profit before Tax /

Turnover) x 100

This reveals the profits earned per pound of sales and therefore

measures the efficiency of the operation.

This ratio is an indicator of the business' ability to withstand adverse

conditions such as falling prices, rising costs or declining sales

Return

on

assets

(%)

(Profit before Tax /

Total Assets) x 100

This is the key indicator of profitability for a company it matches

operational profits with the assets available to earn a return.

Companies using their assets efficiently will have a relative high return

while less well run businesses will have a relatively low return

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DISCLAIMER: THIS REPORT MAY NOT BE REPRODUCED IN WHOLE OR IN PART IN ANY FORM OR MANNER WHATSOEVER.

This report is forwarded to the Subscriber in strict confidence for use by the Subscriber as one factor in connection with credit and other business

decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

New Credit Risk Index (NCRI) Guide

Risk Index

Level

Observation Observed Business

Failure Rate

RI 1 Significantly lower than average risk level 0.70%

RI 2 Lower than average risk level 1.40%

RI 3 Average risk level 1.70%

RI 4 Slightly higher than average risk level 1.90%

RI 5 Higher than average risk level 2.00%

RI 6 1.5 times higher than average risk level 2.50%

NA Assessment not available due to insufficient data

The D&B New Credit Risk Index provides a quick assessment of a business's risk standing based on

observed business failure of companies in Singapore. When used together with other information, it helps you derive better risk decisions.

The Risk Index was recently enhanced in November 2003 and has been computed using D&B's expertise

and advanced statistical techniques. It is calculated based on up-to-date information currently available in

the D&B Singapore database.

The D&B Risk Index is based on a scale of 1 to 6, where 1 represents a lower and 6 a higher percentage of

observed Business Failures.

Though the index does not predict the probability of business closure, it reflects from a database profiling approach, the ratio of failed to operating businesses for each Risk Index Level.

The Risk Index is computed using the following key drivers available in the report. Each risk value is first

weighted according to that area's overall importance, and then aggregated and considered with the other

weighted risk values. The final Risk Index is assigned base on ranges. The final aggregated value is

compared with the predetermined ranges and the Risk is assigned to the report.

Business Information 49%

Employee Size

Age of Company Management Antecedents (History)

Legal Company Structure

Industry

Family Support

Capital (SGD)

Financial Information 25%

Turnover (SGD)

Total Shareholder’s Equity (SGD) Net Profit (SGD)

Current Ratio

Payment Information 11%

Incidence of Slow Payment

Public Filings 15%

Registered Charges

Court Actions/Litigation

Adopted abbreviations: NA - Not Available SGD - Singapore Dollar SC - subject company (the company inquired by you)

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decisions. The report contains information compiled from information which D&B Singapore does not control and which has not been verified unless

indicated in this report. D&B Singapore therefore cannot accept responsibility for the accuracy, completeness or timeliness of the contents of the report. D&B Singapore disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report.

Confidentiality

CONFIDENTIAL....THIS INFORMATION IS PROVIDED BY DUN & BRADSTREET SUBJECT TO THE TERMS AND CONDITIONS OF YOUR SUBSCRIPTION CONTRACT AND IS NOT TO BE DISCLOSED.

This report is forwarded to the Subscriber in strict confidence for the use by the

Subscriber as one factor to consider in connection with credit and other business

decisions. This report contains information compiled from information which Dun &

Bradstreet does not control and which has not been verified unless otherwise indicated in

this report. Dun & Bradstreet therefore cannot accept responsibility for the accuracy,

completeness or timeliness of the report. Dun & Bradstreet disclaims all liability for any

loss or damage arising out of or in anyway related to the contents of this report. This material is confidential and proprietary to Dun & Bradstreet and/or third parties and may

not be reproduced, published or disclosed to others without the express authorization of

Dun & Bradstreet.

COPYRIGHT 2013 DUN & BRADSTREET. THIS REPORT MAY NOT BE REPRODUCED IN WHOLE OR IN PART IN ANY FORM OR MANNER

WHATSOEVER.

Disclaimer

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be copied or otherwise reproduced, repackaged, further transmitted, transferred, disseminated, redistributed or resold, or stored for

subsequent use for any such purpose, in whole or in part, in any form or any manner or by any means whatsoever, by any person

without express authorization of Dun & Bradstreet (hereinafter referred to as ‘D&B’).

All information contained herein is obtained by D&B from sources believed by it to be accurate and reliable. Although reasonable care

has been taken to ensure that the information herein is true, such information is provided ‘as is’ without any warranty of any kind

and D&B, in particular, makes no representation or warranty, express or implied, as to the accuracy, timeliness or completeness of

any such information. All information contained herein must be construed solely as statements of opinion and D&B shall not be liable

for any loss incurred by users from any use of this report or its contents.

D&B's information and opinion should not be the only criterion when making business decisions on subject of report. Data in this

report should be considered as an additional factor together with others in order to reach a decision. In the course of its work/survey, D&B may have received information from the “Subject Company’’ being rated or graded, besides the fact that the

report may also contain data/information available in the Public Domain or that made available through Secondary Sources.

-- End of Report --