RG BRANDS LLP (Kazakhstan): financial indices

/IRBIS, Feb 6, 01/ - Following are financial and economic ratios of RG BRANDS LLP (Almaty), made by the data of the Listing Commission of Kazakhstan Stock Exchange (KASE). The information is published in connection with admission of the second issue bonds of the company into official list of the KASE securities, category "A". The management of RG BRANDS LLP assumes full responsibility for the reliability of presented information. FINANCIAL STATEMENTS DATA PRESENTED BY THE ISSUER RG BRANDS LLP presented its balance sheet, income and cash flow statements for the years 1998-1999 and preliminary reports for 2000, which were made in accordance with the Kazakhstani accounting standards (KAS). The table below is compiled by the KASE specialists analysts using data of the issuer (in th. KZT, unless otherwise specified). ---------------------------------------------------------- As of As of As of Index Jan 01 '99 Jan 01 '00 Jan 01 '01 ---------------------------------------------------------- Authorized capital (paid) 640 640 705,000 Shareholders' equity -494 2,068 727,042 Book value of the assets 11,602 570,424 1,250,003 Working capital -494 -65,751 659,427 Accounts receivable 2,321 75,575 590,248 Liabilities 12,096 568,356 522,961 Loans attracted - 292,938 254,902 Accounts payable 12,096 275,418 268,059 Sales 0 69,691 496,779 Net profit (loss) -1,134 2,562 20,614 Return on sales (ROS), % - 33.85 27.30 Return on equity (ROE), % - 123.88 2.84 Return on assets (ROA), % - 0.45 1.65 ---------------------------------------------------------- Authorized capital of the company was increased from KZT640 th. to KZT705 mln as of April 3, 2000 based on the founder's decision. Increase in book value of the assets was mainly caused by KZT515 mln increase in accounts receivable. Based on the company's data, the principal of KZT557 mln should be repaid on January 30, 2001. Following is the table created by the KASE specialists on the basis of the cash flow statement of RG BRANDS LLP (in th. KZT, unless otherwise specified). --------------------------------------------------------- As of As of Index Jan 01 '00 Jan 01 '01 --------------------------------------------------------- Cash inflow: 534,413.60 1,706,031.90 sales 14,602.60 446,667.40 other operating inflows 850.00 64,964.60 other inflows 518,961.00 1,194,399.90 Cash outflows: -731,403.30 -1,997,820.30 operating payments -81,472.80 -692,602.40 other payments -649,930.50 -1,305,217.90 Operating cash flows -196,989.70 -291,788.40 Cash received 0.00 0.00 Cash paid 0.00 -464.30 Cash from investment activities +0.00 -464.30 Cash inflows: 197,061.20 1,032,771.00 loans 162,561.20 144,032.20 share sales 34,500.00 5,433.30 other inflows 0.00 883,305.50 Cash outflows: 0.00 -732,938.90 loans repaid 0.00 -157,650.80 dividends 0.00 -2,914.20 other payments 0.00 -572,373.90 Cash from financing activities +197,061.20 +299,832.10 --------------------------------------------------------- The company had not disclosed the information on other inflows and outflows shown in the cash flow statements, which are considerable amounts. Other cash inflows from operating activities account for 70% of total operating inflows and other payments - 65.3% of all operating payments. Based on cash generated from financing activities, other inflows account for 85.5% of all inflows, and other payments - 78% of all payments. As a result, the company had negative cash flows in 1999 and 2000, resulting in cash deficit, which are restored by attracting loans and other receipts from financial activities. AUDITING REPORT DATA RG BRANDS LLP presented auditing reports on its financial statements for 1999 made by PricewaterhouseCoopers LLP (Almaty, Kazakhstan) made by the Kazakhstani accounting standards, and for 9 month 2000 made by Kazexpertaudit (Almaty, Kazakhstan) in compliance with the Kazakhstani accounting standards. In auditing report the PricewaterhouseCoopers LLP notes that except for the absence of comparable data, as it is required by the Kazakhstani accounting standards, financial statements give a reliable presentation of financial situation of RG BRANDS LLP in all necessary aspects as of December 31, 1999, as well as the results of its financial and economic activities and cash flows as of indicated period in accordance with Kazakhstan accounting standards. In its auditing report the Kazexpertaudit LLP notes that financial statements give a reliable presentation of financial situation of the company in all necessary aspects as of October 1, 2000 and are in compliance with the methods used in Kazakhstan to make financial statements. The Kazexpertaudit LLP has also conducted auditing of the RG BRANDS LLP financial condition and solvency. In the view of the Kazexpertaudit, the company can not cover its current liabilities as of reporting date, since it does not have sufficient cash and financial investments (payments reached KZT102,188 th.). However, the company has noticeable amount of accounts receivable and if they are paid back soon it can cover all its debt and improve financial condition. The only source of the improvement of its financial situation are the loans or involvement of new partners and founders. To estimate the liquidity an inequality was used and based on it the company was declared liquid. The Kazexpertaudit notes that the RG BRANDS LLP is dependent on the loans and investors, since self-sufficiency coefficient is equal to theoretical 0.54, which confirms the company's financial stability. In the opinion of the auditor, the RG BRANDS LLP, which uses its own capital only, has the highest degree of stability, but it limits its growth temps, as it can not provide with sufficient volumes of assets during a favorable market and does not use financial growth opportunities of its income per invested capital. Excessive financial flexibility can cut the profit margin.