Dun & Bradstreet 四川宏华

1. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] This report prepared by Huaxia D&B China is sent to answer your inquiry on: Sichuan Honghua Petroleum Equipment Co., Ltd. D - U - N - S: 52 - 780 - 7604 Prepared for :Sichuan Honghua Petroleum Equipment Co., Ltd. Subscriber Key :927113623 Delivery Date :May 16,2013 Printed on :May 16,2013 Inquiry Date :May 14,2013 Inquiry Subject : Inquiry Address : Inquiry Phone/Fax:(P)028-82971733 Inquiry Reference :CS Dept. Huaxia D&B China report products provide powerful predictive China Delinquency Score (CDS) now! Equipped with world-class predictive modeling capability and years of deep insight in China market, Huaxia D&B China has successfully launched China Delinquency Score (CDS), and our report products now provide powerful predictive CDS! HDBC's Delinquency Score predicts the likelihood that a company will pay its bills in a severely delinquent manner based on the information in HDBC's files. The China Delinquency Scoring System uses statistical probabilities to provide customers the analytical tool for businesses to manage credit policies as well as risk decisions in emerging market, in particular the businesses in China. What's updated in Business Information Report? Applied China Delinquency Score - Specially designed to quantify risk levels that can be related to probability of delinquent of business counter-parties; Introduced three measurement of CDS in form of score, percentile, and class, for ease of use for our customers in different decision scenarios. We dedicate to become your most trusted source of business information and insight by continuously enhancing our analytical tools and business reports. For more information, please visit www.huaxiadnb.com or call our customer service. Hotline:Shanghai: 400-820-3536 Beijing: 400-810-3531 Guangzhou: 800-830-9032 Copyright ? 2011-2015 Shanghai Huaxia Dun & Bradstreet Business Information Consulting Co., Limited THIS REPORT MAY NOT BE REPRODUCED IN WHOLE OR IN PART IN ANY FORM OR MANNER WHATSOEVER This report, furnished pursuant to contract for the exclusive use of the subscriber as one factor to consider in connection with credit, insurance, marketing or other business decisions, contains information compiled from sources which Shanghai Huaxia Dun & Bradstreet Business Information Consulting Co., Limited (Huaxia D&B China) does not control and whose information, unless otherwise indicated in the report, has not been verified. In furnishing this report, Huaxia D&B China in no way assumes any part of the user's business risk, does not 2. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] guarantee the accuracy, completeness, or timeliness of the information provided, and shall not be liable for any loss or injury whatever resulting from contingencies beyond its control or from negligence. Sichuan Honghua Petroleum Equipment Co., Ltd. Report compiled May 16,2013 Identification Company Name Sichuan Honghua Petroleum Equipment Co., Ltd. Official English Name Yes Chinese Name DUNS? Number 52-780-7604 Address Sec.2, Zhongshan Road, South, Guanghan Sichuan Postal Code 618300 Address (Chinese) Telephone 0838 5151724 0838 5102729 Facsimile 0838 5151100 Website www.hhcp.com.cn Type of Business A wholly foreign-owned enterprise Year Started 2006 History Clear (Complete Shareholder(s) and management information) Imports Yes Exports Yes Employees 4,000 (Total) 3,800 (Here) Principal Ping ZHAO / Legal Representative US SIC Code 3533 9903 Primary Business Oil field machinery and equipment Risk Summary RISK EVALUATION EMMA Score 2 D&B Rating 5A1 D&B PAYDEX? 78 China Delinquency Score Risk Class 2 LEGAL EVENTS Litigation Records 1 PRINCIPAL INFORMATION Principal(s) 1 PAYMENT INFORMATION Trade References 43 COMPANY KEY EVENTS History Changes 18 Media Records 1 FINANCIAL SUMMARY Registered Capital RMB 750,000,000 Sales/Turnover 2,958,600,000 (2011) Tangible Net Worth 1,493,225,000 (2011) Total Assets 4,423,376,000 (2011) Shareholders Equity 1,613,751,000 (2011) CURRENCY All monetary amounts quoted in this report are shown in Renminbi(RMB) unless otherwise stated. REMARK "-" stands for "Insufficient information" or "No 3. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Low Risk Delinquency Class: 2 comments". Risk Assessment EMMA Score 2 Relative Risk 1 10 D&B Rating 5A1 Financial Strength 5A (Tangible Net worth > 450,000,000) Composite Appraisal 1 Strong China Delinquency Score 533 Likelihood this company will not pay on time over the next 12 months 1 5 Subject's CDS score is 533, indicating the company is within the class of 2 in CDS distribution, which is within medium level of delinquent risk range. The likelihood of the company group to be delinquent in next 12 month is 3.1%, which belongs to medium level delinquency risk group. Meanwhile, the theoretical probability of sever delinquency by subject company is referenced as 3.40%, indicating that the base line for initial credit granting could be based on group level delinquency, but should go through comprehensive overview of subject's credit worthiness before final decision. Company Overview Subject was established in 2006. Subject is mainly engaged in manufacturing and selling Oil field machinery. Currently, subject owns around 3,800 staff. In 2011, subject's Revenue reached RMB 2,958,600 thousand, Operation Profit was RMB 234,265 thousand and Quick Ratio that year was 1.09. Subject's EMMA score is "2", which is in the low risk range. Based on its financial statements, subject's financial status is considered as fair, indicating subject's real risk is probably consistent with the EMMA score reflected. Current Investigation On May 16,2013 , Song Daoyou(Tel: 1592862****) confirmed all information in this report. The information in this report is collected and validated through telephone interview with subject, review of public web sites of the business and acquisition of data that is publicly available by the Chinese Government. History Changes Date Event Oct 09,2006 Name changed Feb 27,2006 Shareholder changed Apr 26,2006 Shareholder changed Jul 03,2006 Shareholder changed Aug 17,2006 Shareholder changed 4. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Sichuan Honghua Petroleum Equipment Co., Ltd. Industry 0 1 2 3 4 5 6 7 8 9 10 EMMA Score Sep 15,2006 Shareholder changed Oct 26,2009 Shareholder changed Apr 26,2006 Capital changed Jul 03,2006 Capital changed Aug 17,2006 Capital changed Sep 15,2006 Capital changed Jun 05,2008 Capital changed Sep 15,2006 Registered Address Changed Sep 15,2006 Legal Status Changed Legal Representative Changed Sep 15,2006 Registration Number Changed Jun 05,2008 Registration Number Changed EMMA Score 1 2 3 4 5 6 7 8 9 10 EMMA Score Analysis Subject's EMMA score is mainly impacted by the following risk drivers: Subject's registered capital is RMB 750,000,000, which is in the higher level range, indicating a lower risk. Subject has an employee size of 4000, which is in the higher range level, indicating a lower risk level. Subject is a wholly foreign-owned enterprise, which is classified as a lower risk type of business. Subject/Industry PAYDEX? shows payment behaviour of the company/industry is good, indicating lower risk. EMMA Score 2 By evaluating all risk factors, the company is assigned with EMMA score of "2", indicating "Low Risk". Industry Norm Grouping Industry Group SIC 3533 Industry Group Description Oil and gas field machinery Industry Group EMMA Score Quartile Values Lower Quartile 5 Median 6 Upper Quartile 7 Company Risk Vs Industry Norm Chart EMMA Score Lower Quartile Median Upper Quartile 5. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Distribution of EMMA Score in Huaxia D&B China's Database 40% 35% 30% 25% 20% 15% 10% 5% 0% 1 2 3 4 5 6 7 8 9 10 Score Distribution 1 0% 2 2% 3 6% 4 9% 5 24% 6 22% 7 23% 8 8% 9 6% 10 0% Note: please refer to the report appendix for the principle and major factors of Huaxia D&B China EMMA Score. Risk Assessment Matrix PAYDEX Risk Range Low (EMMA 1 - 3) Medium (EMMA 4 - 7) High (EMMA 8 - 10) PAYDEX>=80 AA BA CA 80>PAYDEX>=60 AB (Subject lies in this group) BB CB PAYDEXAB Business is sound, and the bills are paid promptly with good credit reputation. Favorable credit policy can be granted with automatic approval. Medium risk group BA->BB->AC Business is operated under medium risk, and some delay payment behaviors exist. Appropriate credit policy is suggested with some manual review. High risk group CA->BC->CB Business is operated under high risk, and some severe delay payment behaviors exist. Relatively strict credit policy is suggested with detailed manual review. Monitoring group CC Business is run under high risk or with high possibility of windup, and the bills are unable to be paid in time. Avoid credit sales. Cash settlement is suggested. *Risk levels are listed in order of risk from low to high. According to the Risk Assessment Matrix, subject is rated as "AB", which represents the subject belongs to the quality group: The risk level of the subject is low, which reveals its business risk is relatively lower than the average level amid all Chinese enterprises; The PAYDEX? of subject/industry indicates that some delay payment behavior exists. However, the time and amount of the delay is relatively acceptable, thus its delay payment behavior is not severe; Subject is rated as a high quality company due to its sound operation, low risk level and good credit reputation. Even the subject/industry has some short-term delay payment behaviors, which might be caused by the specific industry character, subject is still recommended to be granted with relative favorable credit policy. D&B PAYDEX? The D&B PAYDEX? is a unique indicator of payment performance weighted by the monetary value of the payment experiences as reported to D&B by trade references. A detailed explaination of how to read and interpret PAYDEX values can be found in the Appendices section of this report. 6. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] High risk of late payment(average 30 to 120 days beyond terms) Medium risk of late payment(average 30 days or less beyond terms) Low risk of late payment(average prompt to 30+ days sooner) PAYDEX of This Business 78 0 100 When weighted by value,payments to suppliers average 3 days beyond terms based on payments collected over the last 24 months This business has a higher PAYDEX than its industry PAYDEX of This Industry 64 0 100 When weighted by value,payments to suppliers average 19 days beyond terms based on payments collected over the last 24 months Industry Name:Oil and gas field machinery Industry Median:64 Upper/Lower Quartile:84/46 Based on:40 businesses D&B PAYDEX? Key Trade Payment Experiences Details (Amounts may be rounded to the nearest figure in prescribed ranges) Date Paying Record High Credit Now Owes Past Due Selling Terms Last Sale May 16,2013 Prompt 300,000 0 0 EOM 30 May 16,2013 May 16,2013 Prompt 1,200,000 0 0 % Deposit May 16,2013 Apr 30,2013 Prompt 0 0 0 Advance -- Mar 31,2013 Prompt 0 0 0 Advance -- Mar 31,2013 Prompt 2,000,000 500,000 35,000 Net -- Feb 28,2013 Prompt 0 0 0 Advance -- Feb 28,2013 Prompt/Slow 90+ 2,000,000 900,000 400,000 Net -- Jan 31,2013 Prompt 0 0 0 Advance -- Jan 31,2013 Prompt/Slow 60+ 2,000,000 900,000 300,000 Net -- Jan 31,2013 Prompt/Slow 60+ 800,000 200,000 65,000 Net 45 -- Dec 31,2012 Prompt 0 0 0 Advance -- Dec 31,2012 Prompt/Slow 30+ 2,000,000 2,000,000 300,000 Net -- Dec 31,2012 Prompt 800,000 800,000 40,000 Net 45 -- Nov 30,2012 Prompt/Slow 60+ 500,000 300,000 45,000 Net 45 -- Nov 30,2012 Prompt 0 0 0 Advance -- Nov 30,2012 Prompt 2,000,000 1,000,000 60,000 Net -- Oct 31,2012 Prompt 500,000 400,000 0 Net 45 -- Oct 31,2012 Prompt 0 0 0 Advance -- Oct 31,2012 Prompt/Slow 30+ 2,000,000 2,000,000 400,000 Net -- Sep 30,2012 Prompt 0 0 0 Advance -- Sep 30,2012 Prompt/Slow 30+ 2,000,000 2,000,000 400,000 Net -- Sep 30,2012 Prompt/Slow 30+ 500,000 200,000 55,000 Net 45 -- Aug 31,2012 Prompt 500,000 500,000 0 Net 45 -- Aug 31,2012 Prompt 0 0 0 Advance -- Aug 31,2012 Prompt 2,000,000 2,000,000 200,000 Net -- Jul 31,2012 Prompt 0 0 0 Advance -- Jul 31,2012 Prompt/Slow 60+ 1,000,000 1,000,000 500,000 Net -- 7. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Jun 30,2012 Slow 30-60 1,000,000 900,000 500,000 Net -- Jun 30,2012 Prompt 0 0 0 Advance -- Jun 30,2012 Prompt/Slow 30+ 300,000 300,000 100,000 Net 45 -- May 31,2012 Prompt 0 0 0 Advance -- May 31,2012 Prompt 1,000,000 1,000,000 90,000 Net -- May 31,2012 Prompt 100,000 100,000 0 Net 45 -- Apr 30,2012 Prompt 0 0 0 Advance -- Apr 30,2012 Prompt/Slow 30+ 900,000 900,000 300,000 Net -- Apr 30,2012 Prompt 100,000 100,000 0 Net 45 -- Mar 31,2012 Prompt 0 0 0 Advance -- Mar 31,2012 Slow 30-60 900,000 750,000 400,000 Net -- Mar 31,2012 Slow 30+ 1,000 1,000 500 Net 45 -- Feb 29,2012 Prompt 0 0 0 Advance -- Feb 29,2012 Slow 30-60 900,000 900,000 400,000 Net -- Jan 31,2012 Prompt 0 0 0 Advance -- Jan 31,2012 Slow 30-60 900,000 900,000 500,000 Net -- Note: The above payment record reflects how accounts are paid in relation to the terms granted. Slow-30, for example, indicates a 30 day term where 30 additional days are taken. In some instance, payment beyond terms can be the result of disputes over merchandise, lost invoices, etc Industry Payment Information According to the statistics collected by Huaxia D&B in 2012, the timely payment rate of the machinery manufacturing industry fluctuated between 55% and 60%, indicating the steady development of the industry. In terms of the payment records, the average overdue term of the industry was 16 days, one day longer than that at the last count (2011.10-2012.9). The timely payment rates and the overdue rates in 2012 reached 57.79% and 32.61%, which were slightly better than that of the last court (56.44% and 33.99%), indicating a stable circumstance of the performance. Moreover, 16.56% of the total payment was delayed in 2012. The overdue term of 31-60 days has the largest proportion. Overall, the payment performance of machinery manufacturing industry in the recent 12 months was stable. However, as affected by the weak demand and the severe export condition, the increase pace of total production and sales volume of the industry slowed down. The payment performance of the industry in the future should yet be focused. Supplier Reference According to one of subject's suppliers Shaanxi Qinchuan Machinery Development Co., Ltd., it has cooperated with subject for several years, it supplies machinery and equipment, the general procurement volume of RMB 200,000300,000 per month, settlement method is pay in net 30. Subject's credit is good, no outstanding accounts receivable. Customer Reference Ref.Date Shipment Promptness Product Quality Pricing Competiveness Technical/Service Support Cooperation Time May 16,2013 Prompt Good Fair Good 1 Year2 Year Note: Subject's customer(s) were inquired to comment on the performance on above four dimensions with overall assessment of strong, good, fair and poor. According to one of subject's customers, Jiangsu Xinde Petroleum Machinery Co., Ltd., it has cooperation with subject for 1 year, it supplies of rig. The quality of subjects products is good with fair price and its always prompt delivery. 8. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Registration Registration Date Sep 15,2006 Registered At Sichuan Deyang Administration for Industry & Commerce Registration No. 510600400000212 National Organization Code 620905206 License Expiry Date Sep 14,2026 Registered Capital RMB 750,000,000 Paid-up Capital RMB 750,000,000 Total Investment RMB 750,000,000 Tax No. 510681620905206 Business Started 2006 Type of Business a wholly foreign-owned enterprise Registered Address South section of Zhongshan Ave., Guanghan, Sichuan Legal Representative Zhao Ping Business Scope Oil drilling automation, digital control systems and electrical equipment and machinery equipment development, design, manufacturing, processing; sell our products and supporting mechanical and electrical products and oil additives (excluding dangerous chemicals and precursor chemicals); The company sells products to provide after-sales service, oil field construction, drilling and related technical services;Contract with the company's strength, size, performance to adapt to foreign projects and the implementation of external sent abroad for the project services personnel. (More countries restrict or prohibit the scope of business, except business, shall obtain an administrative license, must obtain the relevant administrative permission, in accordance with permits to carry out production and business activities of the matter) Shareholder(s) Shareholding Structure Name Region/ Country Shares Investment Mode Paid-Up Rate Honghua Holdings Limited Hong Kong 100.0% Cash fully paid Total 100% Comment: Subject passed the annual inspection of2011 with Administration for Industry & Commerce. History Changes Name Changed From: Chuanyou Guanghan Honghua Co.,Ltd. To: Sichuan Honghua Petroleum Equipment Co., Ltd.(Current Name) On(in) Oct 09,2006 Registered Address Changed From: South of Zhongshan Avenue,Guanghan City,Sichuan. To: South section of Zhongshan Ave., Guanghan, Sichuan(Current Registered Address) On(in) Sep 15,2006 Shareholders Changed 9. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] From: Sichuan Huasheng Oil Industry Development General Company (16.34%),Xing Manrong(5.86%),Yuan Guiqi(5.81%),Deng Meng(5.81%),Zhang Mi(5.56%),Wang Yaoxin(5.16%),Liu Chuanjun(4.23%),Shi Shuming(4.02%),Li Yan(4.01%),He Guangfu(3.97%),Ren Jie(3.41%),Zhi Rongmo(3.39%),Zuo Huixian(3.18%),Zhang Zongyong(3.14%),Zhang Yanyong(2.86%),Zhou Tao(2.72%),Zhang Xu(2.68%),Fan Bing(2.53%),Ni Xiurong(2.39%),Liu Xuetian(2.29%),Chen Zongliang(2.26%), other natural persons(8.62%) To: Sichuan Huasheng Oil Industry Development General Company (16.32%),Yang Yuanchun(1.33%),Yang Xuefeng(1.78%),Ni Xiurong(2.25%),Liu Xuetian(2.33%),Zhou Tao(2.60%),Zhang Xu(2.72%),Fan Bing(2.74%),Zhang Yanyong(2.95%),Zhi Rongmo(3.01%),Zuo Huixian(3.21%),Shi Mingshu(3.77%),Li Yan(3.77%),Ren Jie(3.98%),Zheng Yong(4.04%),Liu Chuanjun(4.09%),Wang Yaoxin(5.15%),Xing Manrong(5.28%),Deng Meng(5.81%),Yuan Guiqi(5.81%),Zhang Mi(10.95%), other natural persons(6.11%) On(in) Feb 27,2006 To: Sichuan Huasheng Oil Industry Development General Company (24.78%),Shen Dingjian(0.24%),Tian Yu(0.29%),Chen Jun(0.29%),Li Hanqiang(0.29%),Tang Ying(0.41%),Tian Diyong(0.52%),Lv Lan(0.72%),Ao Pei(0.75%),Liu Zhi(1.77%),Zhou Bing(1.79%),Liu Xuetian(3.53%),Zhang Xu(4.13%),Fan Bing(4.16%),Zhang Yanyong(4.48%),Zuo Huixian(4.88%),Ren Jie(6.05%),Zheng Yong(6.13%),Deng Meng(8.81%),Yuan Guiqi(8.81%).Zhang Mi(16.63%), other natural persons(0.54%) On(in) Apr 26,2006 To: Liu Yingguo(0.3%),Liu Lulu(0.3%),Shen Dingjian(0.41%),Tian Yu(0.49%),Chen Jun(0.51%),Li Hanqiang(0.51%),Tang Ying(0.70%),Tian Diyong(0.90%),Lv Lan(1.24%),Ao Pei(1.29%),Wang Jiangyang(1.45%), Liu Zhi(3.04%),Zhou Bing(3.07%),Liu Xuetian(6.06%),Zhang Xu(7.08%),Fan Bing(7.15%),Zhang Yanyong(7.68%),Zuo Huixian(8.37%),Ren Jie(10.38%),Zheng Yong(10.52%),Zhang Mi(28.55%) On(in) Jul 03,2006 To: Xu Chuan(0.76%),Ma Limin(0.87%),Di Xiaohong(0.92%),Chen Jun(0.94%),Liu Gangqiang(0.96%),Wang Jiangyang(1.07%),Luo Qiping(1.60%),Zhou Bing(2.03%),Zhao Ping(2.49%),Yang Hong(3.19%),Zhang Yanyong(3.71%),Liu Xuetian(3.73%),Fan Bing(4.16%),Zhang Xu(4.21%),Zuo Huixian(4.37%),Zhang Cong(4.55%),Zheng Yong(5.60%),Liu Zhi(5.60%),Ren Jie(7.90%),Zhang Mi(36%), other natural persons(5.34%) On(in) Aug 17,2006 To: Asia Harbour International Limited(100%) On(in) Sep 15,2006 To: Honghua Holdings Limited(100.0%)(Current Shareholders) On(in) Oct 26,2009 Registration Organ Changed From: Sichuan Deyang Guanghan Administration for Industry & Commerce To: Sichuan Deyang Administration for Industry & Commerce(Current Registration Organ) On(in) Sep 15,2006 Capital Changed From: RMB 21,011,100 To: RMB 13,944,485 On(in) Apr 26,2006 To: RMB 8,070,305 On(in) Jul 03,2006 To: RMB 18,750,000 On(in) Aug 17,2006 10. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] To: RMB 72,000,000 On(in) Sep 15,2006 To: RMB 750,000,000(Current Capital) On(in) Jun 05,2008 Legal Status Changed From: a limited company To: a wholly foreign-owned enterprise(Current Legal Status) On(in) Sep 15,2006 Legal Representative Changed From: Zhang Mi To: Zhao Ping(Current Legal Representative) Change date not available Registration Number Changed From: 5106812801294 To: 000370 On(in) Sep 15,2006 To: 510600400000212(Current Registration Number) On(in) Jun 05,2008 History Summary Subject was established in 2006. Subject's registered capital is RMB 750,000,000 at present. Principal(s) Ping ZHAO - Legal Representative Started with Subject 2003 Activity Status Yes Area of Responsibility Overall management Related Working Experience 5 Year+ Supply Capacity & Operation Nature Subject is mainly engaged in manufacturing and selling Oil field machinery. US SIC Code 3533 9903 Oil field machinery and equipment Ordering Methods: Electronic Data Interchange(EDI),E-mail,Fax Logistics: Third party logistics The operation is not seasonal. Brands 11. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Brands Owned Hong Hua Awards & Certifications Awards & Certifications Name ISO9001 Date Awarded 2000 Licenses Subject is entitled to independent import and export rights. Products & Services Product Name Maximum Productivity Percent Land rigs 150 sets per year 70% Mud Pump 600 sets per year 10% others 20% Subject owns 600 sets of manufacturing equipments made in China. Subject owns 40 production lines made in China. Annual Output Product Name Amount Year Land rigs 3.5 billion yuan 2012 Mud Pump 500 million yuan (Sales) 2012 Purchasing Purchase Territory Area Percent Region/Country Domestic 80% Sichuan Shaanxi Chongqing Hubei Overseas 20% United States ( 10% ) Germany ( 5% ) Others ( 85% ) Import Value Year Amount 2012 USD 139,010,000 Purchasing Terms Terms Percent L/C - - Agreement/Contract basis - - Partial Advance - - Credit - - Purchasing Settlement Method Settlement Method Percent Cash T/T 12. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Check Draft L/C Suppliers Number 450 Major Suppliers Area Name DUNS Domestic Shaanxi Qinchuan Machinery Development Co., Ltd. 42-072-0427 Domestic Shanghai Shenkai Petroleum Science & Technology Co., Ltd. 52-815-8346 Domestic Nanyang Explosion-proof Motor Factory Selling Sales Territory Area Percent Region/Country Domestic 32% Jiangsu Heilongjiang Xinjiang Overseas 68% Venezuela ( 26% ) Russia ( 12.5% ) United Arab Emirates ( 3% ) India ( 1.6% ) Others ( 56.9% ) Export Value Year Amount 2012 USD 634,630,000 Selling Terms Terms Percent Agreement/Contract basis - - Partial Advance - - Credit - - L/C (Sight) - - Selling Settlement Method Settlement Method Percent T/T Cash Check Draft L/C Customer Type Customer Total 250 Type Percent Company Major Customers 13. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Area Name DUNS Domestic CNPC the Great Wall Drilling Engineering Group Domestic Jiangsu Xinde Petroleum Machinery Co., Ltd. 54-666-3480 Domestic Yumen Oil Field Domestic Daqing Oil Field Domestic Sino Pec Southwest Bureau Domestic Sino Pec Middle South Bureau Employees Employee Size Type Number Total 4,000 Here 3,800 Sales Person 120 Administrative Staff 500 The above are approximate staff numbers. Major Functional Departments Department(s) Finance Dept. Business Dept. Administration Dept. Production Dept. Purchasing Dept. others Operations Summary Subject is mainly engaged in manufacturing and selling Oil field machinery. It owns brand 'Hong Hua'. The materials subject demands for its production are 80% purchased domestically. 20% of the materials are imported, mainly from United States, Germany, Others and other region. Shaanxi Qinchuan Machinery Development Co., Ltd., Shanghai Shenkai Petroleum Science & Technology Co., Ltd. and ect. are its suppliers.Subject is entitled to I/E Rights. Currently, subject owns 600 sets production equipment and 40 production lines. Subject's major products are Land rigs, Mud Pump and others. The productivity of Land rigs is 150 sets per year. The productivity of Mud Pump is 600 sets per year. 32% of the products are sold domestically. Major customers include CNPC the Great Wall Drilling Engineering Group, Jiangsu Xinde Petroleum Machinery Co., Ltd. and etc. 68% of the products are exported, such as Venezuela, Russia, United Arab Emirates, India and Others and other region. Location Principal Place of Business Location Description An industrial area Land Area 700,000 sqm Used as Office, factory and warehouse Occupation Type Owns Other Place of Business Type REGISTERED ADDRESS Address South section of Zhongshan Ave., Guanghan, Sichuan 14. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Linkage Up Parent Company D-U-N-S 66-941-3643 Company Name Honghua Holdings Limited Address 39 Gloucester Rd Wan Chai Hong Kong Island Hong Kong Shares held in subject 100.0% Finance The 2011 financial statements were submitted by the company personnel. Financial Highlights Dec 31,2011 RMB '000 Change % Dec 31,2010 RMB '000 Change % Dec 31,2009 RMB '000 Current Assets 3,629,755 -9.03% 3,990,027 -7.13% 4,296,369 Current Liabilities 2,408,517 -14.54% 2,818,229 -4.93% 2,964,295 Working Capital 1,221,238 4.22% 1,171,798 -12.03% 1,332,074 Tangible Net Worth 1,493,225 9.26% 1,366,679 -8.34% 1,491,026 Fixed Assets 292,792 -3.07% 302,060 5.43% 286,501 Total Assets 4,423,376 - 4,423,616 - 4,711,448 Total Liabilities 2,809,625 -6.78% 3,013,967 -5.13% 3,176,897 Shareholders Equity 1,613,751 14.48% 1,409,649 -8.14% 1,534,551 Sales 2,958,600 57.66% 1,876,596 -4.32% 1,961,270 Net Profit 200,301 312.17% (94,408) 19.81% (117,732) Balance Sheet Dec 31,2011 RMB '000 Fiscal (Independent) Dec 31,2010 RMB '000 Fiscal (Independent) Dec 31,2009 RMB '000 Fiscal (Independent) Cash and Bank 465,800 504,318 1,142,693 Accounts Receivables 1,838,960 1,149,577 893,084 Notes Receivables 1,700 2,000 200 Dividends Receivable 7,558 7,558 12,262 Interest Receivable 26 366 6,512 Other Receivables 35,920 162,040 171,896 Inventory 992,478 1,346,532 1,296,644 Advance to Suppliers 287,313 817,636 773,078 Total Current Assets 3,629,755 3,990,027 4,296,369 Fixed Assets Disposal 15 - 476 Other Fixed Assets 276,993 279,572 259,078 Construction in Progress 15,784 22,488 26,947 15. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Total Fixed Assets 292,792 302,060 286,501 Intangibles 118,447 42,970 43,525 R&D Expenses 2,079 - - Total Intangible Assets 120,526 42,970 43,525 Held-to-maturity Investment 235,000 - - LT Equity Investment 130,522 88,522 84,876 LT Prepaid Expense - 37 177 Deferred Tax Assets 14,781 - - Total Investment & Other Assets 380,303 88,559 85,053 TOTAL ASSETS 4,423,376 4,423,616 4,711,448 Short-Term Loans 763,623 200,179 1,014,141 Accounts Payable 967,689 1,368,269 812,416 Notes Payable 256,191 124,275 92,642 Interest Payable 3,119 562 1,197 Other Payables 69,694 16,343 34,132 Advances from Customers 317,963 949,046 977,993 Provision:Taxes & Fees (26,175) (12,633) 7,710 Provision for Dividends 4 4 5 Accrued Payroll 26,409 22,184 24,059 LT Debt Due in 12 Mths 30,000 150,000 - Total Current Liabilities 2,408,517 2,818,229 2,964,295 Provisions 21,108 15,738 12,602 Other Non-Current Liab 380,000 180,000 200,000 Total Non-Current Liabilities 401,108 195,738 212,602 Total Liabilities 2,809,625 3,013,967 3,176,897 Capital 750,000 750,000 750,000 Capital Reserve 95,802 92,002 94,621 Surplus 161,720 141,690 141,690 Retained Earnings 606,229 425,957 548,240 Total Equity 1,613,751 1,409,649 1,534,551 TOTAL LIABILITIES & EQUITY 4,423,376 4,423,616 4,711,448 Profit & Loss Statement Dec 31,2011 RMB '000 Fiscal (Independent) Dec 31,2010 RMB '000 Fiscal (Independent) Dec 31,2009 RMB '000 Fiscal (Independent) Sales 2,958,600 1,876,596 1,961,270 -Cost of Goods Sold 2,283,133 1,666,829 1,640,589 -Sales Tax 1,767 661 42 Gross Profit/Loss 673,700 209,106 320,639 -Operating Expenses 185,060 105,636 119,370 -Administrative Expenses 112,404 138,165 157,700 -Financial Expenses 43,375 63,580 34,125 -Asset Impairment Losses 98,596 1,604 123,424 Operating Profit/Loss 234,265 (99,879) (113,980) 16. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] +Investment Income 4,206 241 31,873 +Non Operating Income 3,076 10,787 5,030 -Non-Operating Expense 5,228 5,557 40,655 Profit/Loss Before Tax 236,319 (94,408) (117,732) -Income Tax 36,018 - - Profit/Loss After Tax 200,301 (94,408) (117,732) Net Profit(Loss) 200,301 (94,408) (117,732) Key Financial Ratios Ratio 2011 2010 2009 Current Ratio 1.50 1.41 1.44 Quick Ratio 1.09 0.93 1.01 Total Debt/Equity Ratio 1.74 2.13 2.07 Debt Ratio 0.63 0.68 0.67 Collection Period (Days) 223 220 163 Payment Period (Days) 152 295 178 Inventory Turnover (Days) 156 290 284 Asset Turnover 0.66 0.42 0.41 Gross Profit Margin % 22.77 11.14 16.34 Net Profit Margin % 6.77 (5.03) (6.00) Return on Equity % 12.41 (6.69) (7.67) Return on Assets % 4.52 (2.13) (2.49) Financial Comments Business Performance: According to subject's financial statements of 2011, its sales realized RMB 2,958,600 thousand, up 57.66% over the previous year, indicating its decent sales growth. During the same year, subject's net profit booked RMB 200,301 thousand, up 312.17% over the previous year. Its net profit margin was 6.77%, higher tha the year-earlier level, which indicated its profitability was enhanced to certain extent. Solvency: By the end of 2011, Subject's current ratio and quick ratio posted 1.50 and 1.09 respectively, showing its strong short-term solvency capacity. Its working capital increased to RMB 1,221,238 thousand. Capital Structure: At the end of 2011, subject's debt ratio stood at 0.63, which indicated its capital structure was fair. Cash Flow: By the end of 2011, subject's cash and bank deposit was RMB 465,800 thousand, decreasing from the previous year. At the end of 2011, subject's account receivable booked RMB 1,838,960 thousand, and its DSO recorded 223 days, extending 3 days compared with the year earlier, indicating its control on account receivable weakened. Its account payable was RMB 967,689 thousand, with a payment period of 152 days. Overall financial status of subject is considered as fair. Banking The company maintains relationship(s) with the following bank(s) in China: Bank of China, Guanghan Sub Branch Office Account number: 118502911025 Bank of China, Guanghan Sub Branch Office Account number: 119852911028 (Foreign currencies) 17. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Industry Highlights Date May02,2013 Source Statistics Authorities Detail As of Q4, 2012, the decline of sales of Chinese construction machinery has slowed down, indicating a rebound of the sluggish demand. In 2012, the total sales output of the construction machinery reached RMB 591.57 billion, with a year-on-year increase of 1.85%. The speed was 1.47 percents higher than that of Q3. In terms of market situation, the annual sales volume of major products including loaders, bulldozers, graders, cranes, road rollers, pavers, excavators reached 173,000, 10,200, 4,201, 23,000, 13,300, 2,169 and 112,800 sets, with the respective year-on- year decline of 29.7%, 22.3%, 17%, 35%, 38.5%, 33.6% and 35%. The speed of declined was mostly slowed down compared with that of Q3. In terms of import and export, the import volume has decreased due to the downtur ofg domestic demands. The export slowed down due to the global economic recession and protectionism policies of some areas. From January to November, 2011, the total import and export value of construction machinery reached USD 4.77 billion and USD 15.58 billion, with the year-on-year decrease of 40.3% and a increase of 16.04%. In terms of total investments, the investment value of the industry in 2012 reached RMB 92.25 billion, a year-on-year increase of 29.30%. It is estimated that some positive factors will make effects on the industry in 2013 together with the continuous urbanization, construction of infrastructure and stabilizing of real estate market. Litigation Records As of May 16,2013 , HDBC has searched the China Court website, website of local court in the place where subject is located, major domestic courts websites as well as our internal China court database, and found below related court record(s) against the subject. Remark: The above mentioned channels are currently publicly available ones to search for the court records against China enterprises. However, due to lack of a centralized database in mainland China that covers all Chinese enterprises' litigation records, partial cases against subject might not be available. Judgment Date May 20,2010 Court District Court Judgment Plaintiff(s) n/a Case Details Guanghan People's Court-(2010) Guang Han Zhi Zi No.00314. Judgment To compensate the plaintiff with reimbursement of 1,125.65 Currency RMB Media Records News Clipping Publication Date May 25,2012 mei.net.cn - According to the statistical data of main business incomes of machinery and automobile enterprise of 2011, China Machinery Industry Federation and China Association of Automobile Manufacturers decided the list of top100 machinery industry enterprise and top 30 automobile industry enterprises of 2011. Sichuan Honghua Petroleum Equipment Co., Ltd. ranked the 85th on the list of top100 machinery industry enterprises with most main business income in China of 2011 with the main business income of RMB 2,972,050,000. HDBC EMMA Score D&B EMMA Score (Emerging Market Mediation Alert Score) is a risk assessment model developed for emerging market countries. It is a score developed by data profiling approach and statistical modeling, which predicts the possibility of a business in perilous status of instability or unreliability, such as poor financials, delay payment, stale inventory, abnormal operational status, etc. The EMMA Score provides you with a quick assessment of a business' risk standing, and when used together with other information, allows you to make 18. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] better risk decisions. The EMMA Score is based on a scale of 1 to 10, where 1 represents a lower risk and 10 a higher risk. EMMA Score for China is initially rolled out in May 2009, derived from the sample analysis of millions of company records. When using the Score to make individual applicant decisions, a customized version of this table based on an analysis of the Score against your customer account portfolio is recommended. It does not necessarily mean doing business with a company, which is assigned with higher Risk Score, will result in increased risk. Considering the particularity of Chinese business environment and in order to make EMMA Score analyze and reflect risk factors of Chinese enterprises more appropriately, HDBC conducted an optimization and adjustment toward EMMA Score in the first half of 2012, combined PAYDEX? to appraisal model as an important risk evaluating dimension and will try harder to deeply reflect the internal factors of enterprise risk. The optimized EMMA Score makes the scores more scientifically and effectively reflect the risk characteristics of current China as an emerging market and more objectively and deeply reflect risk level of Chinese enterprises. EMMA Score for China is calibrated on regular basis following D&B Global Modeling Methodology that captures business environmental change in China caused by macro economy shift and particular systematic events. HDBC EMMA Score Commentary Risk Range EMMA Score % of Report in Database % of High Risk Business Commentary Low Risk Scores 1-3 28.9% 5.7% Lower Risk Range Medium Risk Scores 4-7 56.7% 9.1% Average Risk Range High Risk Scores 8-10 14.4% 36.4% High Risk Range The Key Drivers of the EMMA Score include the following: Business Information Business Type Line of Business Employee Size Sales Territory Registered Capital Year of Establishment History Status Property Ownership Geographical Information Region & Province Public Record Number of Negative Record Payment Information Percentage of Overdue Payment Company/Industry PAYDEX? EMMA Score Application Low EMMA Score - May proceed to process the applicant quickly with minimal or no manual review depending on the extent of score validation analysis. Medium EMMA Score - Medium Risk Scores - Recommend a manual review of the applicant based on the applicant's capacity, your internal policy and risk tolerance. High EMMA Score - High Risk Scores - Requires thorough manual review of potential decline, or approval depending on the applicant's capacity, your internal policy and risk tolerance. Sample Data Analysis of Risk Assessment Matrix Database Risk Matrix Sample Distribution PAYDEX Risk Range Low Medium High PAYDEX>=80 13.6% 12.6% 0.5% 80>PAYDEX>=60 15.2% 28.7% 1.7% PAYDEX=80 5.8% 8.4% 9.1% 80>PAYDEX>=60 5.6% 8.4% 14.5% PAYDEXAB Business is sound, and the bills are paid promptly with good credit reputation. Favorable credit policy can be granted with automatic approval. Medium risk group BA->BB->AC Business is operated under medium risk, and some delay payment behaviors exist. Appropriate credit policy is suggested with some manual review. High risk group CA->BC->CB Business is operated under high risk, and some severe delay payment behaviors exist. Relatively strict credit policy is suggested with detailed manual review. Monitoring group CC Business is run under high risk or with high possibility of windup, and the bills are unable to be paid in time. Avoid credit sales. Cash settlement is suggested. *Risk levels are listed in order of risk from low to high. Risk Assessment Matrix is the tool for investigating the insight of subject combined with EMMA Score and PAYDEX?. EMMA Score can indicate the risk level of subject. With the help of PAYDEX?, one can also further analysis subject's risk and find out the internal factors causing risks based on the payment records of subject. In summary, the assessment matrix can make further insightful analysis towards the enterprises with similar EMMA Scores. When using EMMA Score and Risk Assessment Matrix, the combination of other information, such as internal assessment policy of enterprise, commercial information provided by HDBC, and feedback from the people who directly contacts with subject, etc., is recommended. With these information, it will allow you to be more convenient to make risk decisions. D&B Rating D&B Rating Interpretation Tables Financial Strength Composite Credit Appraisal Tangible Net worth Registered Capital Renminbi (RMB) Strong Good Fair Limited Undetermined 5A 5AA > 450,000,000 1 2 3 4 - 4A 4AA 85,000,000 - 449,000,000 1 2 3 4 - 3A 3AA 8,500,000 - 84,999,999 1 2 3 4 - 2A 2AA 6,500,000 - 8,499,999 1 2 3 4 - 1A 1AA 4,500,000 - 6,499,999 1 2 3 4 - A AA 2,500,000 - 4,499,999 1 2 3 4 - B BB 1,750,000 - 2,499,999 1 2 3 4 - C CC 1,000,000 - 1,749,999 1 2 3 4 - D DD 650,000 - 999,999 1 2 3 4 - E EE 450,000 - 649,999 1 2 3 4 - F FF 300,000 - 449,999 1 2 3 4 - G GG 200,000 - 299,999 1 2 3 4 - H HH < 200,000 1 2 3 4 - Alternate Ratings Explanation N Financial Strength is negative 3 4 - O Financial Strength is undisclosed 1 2 3 4 - NB New Business: Less than 24 months 1 2 3 4 - 20. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] NQ Out of Business: Business has ceased to trade 4 BR Branch or division location INV Investigation is undergoing Explanation of PAYDEX A score of 80 denotes that payments reported to D&B have generally been made within terms. Scores over 80 indicate that payments reported to D&B have been made earlier than terms. The chart below outlines the specific 0-100 score and what it means. D&B PAYDEX? Payment Habit 100 Anticipate 90 Discount 80 Prompt 70 15 days beyond terms 60 22 days beyond terms 50 30 days beyond terms 40 60 days beyond terms 30 90 days beyond terms 20 120 days beyond terms 0-19 Over 120 days beyond terms UN Unavailable Explanation of China Delinquency Score HDBC's China Delinquency Score predicts the likelihood that a company will pay its bills in a severely delinquent manner based on the information in HDBC's files. A severely delinquent business is defined as a business with less than 75% of its trade experiences paid in a satisfactory manner (prompt or within 30 days) and at least 10% of its payments 90 days or more past due or one or more events classified as leading to failure, such as meeting of creditors, administrator appointment, bankruptcy, receiver appointed, litigation records within 2 years and negative media information within 1 year. The China Delinquency Scoring System uses statistical probabilities to classify public and private companies into three risk classifications of Business Delinquency: a 279-641 Score, 1-5 Credit Classes and 1-100 Percentile Ranking. These classifications are based on the chance of a business experiencing the above definition of "bad" over the next 12-months period. The China Delinquency Scoring model utilizes the combined power of HDBC's vast information database including Payment, Demographic, Financial, and other information, when and if available. China Delinquency Score is calculated through logistic regression using below 16 risk drivers: Demographic Information Business Type Years in Business Line of Business (SIC) Region & Province History Status Existence of Court Record Financial Information Age and existence of B/S Current Ratio Liabilities to Net Worth Return on Assets Current Assets Payment Information Number of Payment Experiences Payment Term Percent of Satisfactory Payment Experiences Percent of Medium Delinquent Payment Experiences Percent of Severe Delinquent Payment Experiences Risk Quintile in 5 Class % of 21. HDBC Report - China Supplier Evaluation Report file:///C|/...s/wanglk/AppData/Local/Microsoft/Windows/Temporary Internet Files/Content.Outlook/LPN5H5IW/DUNBADSTREET REPORT.htm[2014/5/23 14:08:48] Class MinScore MaxScore Population Actual BadRate Predicted BadRate Cum. Pct. Bads 5 279 380 10% 52.6% 52.2% 48% 4 381 480 20% 13.1% 13.4% 72% 3 481 523 40% 5.7% 5.6% 93% 2 524 556 20% 3.0% 3.1% 99% 1 557 641 10% 1.6% 1.5% 100% Delinquency Level by 5% Quantile Quintile MinScore MaxScore % of Population Actual BadRate Predicted BadRate Cum. Pct. Bads 20 279 333 5% 61% 60% 28% 19 334 380 5% 44% 44% 48% 18 381 435 5% 21% 22% 58% 17 436 457 5% 13% 14% 64% 16 458 474 5% 10% 10% 68% 15 475 480 5% 8% 8% 72% 14 481 483 5% 8% 7% 75% 13 484 487 5% 7% 7% 79% 12 488 495 5% 7% 7% 82% 11 496 501 5% 6% 6% 85% 10 502 509 5% 5% 5% 87% 9 510 516 5% 4% 5% 89% 8 517 520 5% 4% 4% 91% 7 521 523 5% 5% 4% 93% 6 524 532 5% 4% 4% 95% 5 533 539 5% 3% 3% 96% 4 540 546 5% 3% 3% 97% 3 547 556 5% 3% 3% 99% 2 557 584 5% 2% 2% 99% 1 585 641 5% 1% 1% 100% Customer Service Customer Service Contact Information Web www.huaxiadnb.com Email [email protected] Telephone 400-820-3536 (Shanghai) 400-810-3531 (Beijing) 800-830-9032 (Guangzhou) Our ref: 201305149309300039 Your ref: CS Dept. Remarks Whilst Huaxia D&B China attempts to ensure that the information provided is accurate and complete by reason of the immense quantity of detailed matter dealt within compiling the information and the fact that some of the data are supplied from sources not controlled by Huaxia D&B China which cannot always be verified, including information provided direct from the subject of enquiry as well as the possibility of negligence and mistake, HDBC does not guarantee the correctness or the effective delivery of the information and will not be held responsible for any errors or omissions therein. Copyright ? Huaxia D&B China