Solicited Credit Rating Report Page 1 of 16
Solicited Credit Rating Report
Confidential: This document contain confidential information and it is for internal use only. It might contain information that it is not up-to date.
SYSTEMS SUNLIGHT S.A. INDUSTRIAL & COMMERCIAL CO OF DEFENSIVE ENERGY ELECTR.& TELEC. SYST. &MAN. PROC. REC. MAT. & TRADE
Greek Company Name ΣΥΣΤΗΜΑΤΑ SUNLIGHT Α.Β.&Ε.Ε. ΑΜΥΝΤΙΚΩΝ ΕΝΕΡΓ. ΗΛΕΚΤΡ. & ΤΗΛΕΠ. ΣΥΣΤΗΜΑΤΩΝ & ΔΙΑΧ. ΕΠΕΞ. ΑΝΑΚ. ΥΛΙΚΩΝ & ΕΜΠ. ΑΝΑΚ. ΥΛΙΚΩΝ Trade Name: SYSTEMS SUNLIGHT S.A. ICAP ID 212758 Address 2 Ermou & Nikis, 10563, Athens, Attiki Tel. 2106245400 Fax 2106245479 U.R.L. www.systems-sunlight.com E-mail [email protected] Company Identification
Sector Industry (Electric - Electronic Material) Legal Form Societe Anonyme Year Established 1994 Head Office Athens, Attiki Duration Up to year 2044
Gov. Gazette No 01606/1994
Tax Registr. No 094401108 General Business Registration No 1579901000 No of the Register of Societe Anonyme 031055 /004 /Β /94 /157 Member of ATHENS CHAMBER OF COMMERCE & INDUSTRY General Reg. No. 0133626 Exports Reg. No. 0036376
Chairman, CEO Basil Ang. Billis
Capital Euro 44,394,950 Owners Equity Euro 48,087,470 (31/12/2018) Net Sales Euro 107,533,735 (1/1/2018 - 31/12/2018) Net Income for the Year Before Tax Euro 12,827,287 (1/1/2018 - 31/12/2018) No of Employees 815 Business Profile
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Financial Status Good
Payment Record Prompt
Trend Downward
ICAP Credit Rating
ICAP Credit Rating: B (24/6/2019)
The above mentioned Credit Rating has initiated at the request of the rated entity.
Previous ICAP Credit Rating B 5/10/2018
Initial Credit Rating Assignment Date 31/12/2004
Rating Analyst VLACHOPOULOU MARIA Senior Analyst
Rating Supervisor KEFALAS GIORGOS Senior Manager
Rating Committee Evaluation YES
Company's Opinion Agree
Notification ICAP Credit Rating YES
Credit Rating Key Elements Presentation The company SYSTEMS SUNLIGHT SA DEFENSE ENERGY ELECTRONICS AND TELECOMMUNICATIONS SYSTEMS field of activity is: - the construction of energy storage systems for industrial, consumer and advanced applications (batteries for motive power, reserve power, submarines, torpedoes, etc.) - the construction of energy power systems (generator sets, UPS, industrial air conditioning, etc.) - the provision of energy services (advisory and technical support, maintenance, training, etc.) The company concerned was founded in 1994, went by another name (ARION SA) and had a different field of activity. It was acquired in June of 2006 by GERMANOS SA, which was controlled by the businessman Mr. Panos Germanos. Up until October of 2014, Mr. Germanos was the sole shareholder. Until 2018, OLYMPIA GROUP SA HOLDINGS was the sole shareholder of the company and the Group. At the beginning of 2019, the sole shareholder proceeded with the sale of the titleholders shares to OLYMPIA GROUP LTD, based in Cyprus. It is noted that OLYMPIA GROUP LTD is the sole shareholder of OLYMPIA GROUP SA HOLDINGS. The company's headquarters are located in Athens and industrial facilities of considerable size are located in New Olvio in the Prefecture of Xanthi and in the Komotini industrial area. The company's battery plant is the largest in Europe and the most advanced in the field of industrial battery production. SYSTEMS SUNLIGHT is the parent company of the same named Group which participates in companies in Greece and abroad (Romania, Italy). Within 2018, the absorption of its subsidiary with a field of activity in recycling batteries and the production of recycled lead and alloys was completed. SUNLIGHT RECYCLING S.A. has modern facilities in Komotini and is one of the most advanced battery recycling plants in Europe. The company concerned also participates (with 51%), along with a well-known foreign company which specializes in the field of defence applications and systems, in a domestic company developing and producing batteries exclusively for defence applications. Moreover, SYSTEMS SUNLIGHT participates in the share capital of companies abroad which are active in the distribution of batteries. At the end of 2017, SYSTEMS SUNLIGHT proceeded to establish a 100% subsidiary company in Italy, with the object of assembling and trading industrial batteries.
On May 1st, 2018, a fire occurred in the large scale industrial battery segment at the Xanthi plant, causing significant material damage to the industrial battery manufacturing complex and damage of a lesser extent to the submarine battery production segment. The carrying value of the destroyed tangible fixed assets and inventories so far has amounted to 32.7 million. As a result, the company's production activity has been limited to the production of batteries for use in the defence industry, while the trading activity of lightweight applications batteries continued at the usual rate. Its noted that the company has already received the total amount of compensation from the insurance companies. By the end of 2018, 50% of the plant's production capacity has been restored, while, currently, the restoration of the overall operation is almost complete. On 07/2018, the sale of the Toshiba consumer battery industry was completed for a price of 5.36 million to WESTNET DISTRIBUTION SA, a subsidiary company of OLYMPIA Group active in the technology products trading field.
The company concerned has a wide range of clientele consisting mainly of foreign companies. Its clients are active in the field of industry, transport, telecommunications, information technology and construction. Also included in the clientele are the armed forces (Navy) of various countries. Its noted that most of the turnover (93%) comes from sales abroad.
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Evaluation/Suppositions This report concerns the evaluation of the parent company SYSTEMS SUNLIGHT SAs creditworthiness. The evaluation covers the risk of inconsistency and/or bankruptcy by the company concerned and is based on the following:
The company's Detailed Financial Statements for the years 2016, 2017, 2018 that the company has provided us with. The Groups Detailed Financial Statements on a consolidated basis. The analysis of bank liabilities and financing terms as well as the use of loan funds. The company's business data regarding management, export activity, customer size, credit risk management practices, etc. The assessment of the conditions and prospects of the industry in which the company operates. The assessment of the broader macroeconomic environment.
Business Activity The company's revenues are derived, to a large degree, from energy accumulator sales. The accumulators manufactured/marketed by the company concerned are divided into four categories: motive power batteries reserve power batteries power batteries for defence applications
Motive power batteries are mainly used in forklifts. Clients are companies that use forklifts (industries, logistics, etc.) and replace existing batteries due to age, as well as businesses that market the companys products or use its products to produce their own. Clients also include well-known manufacturers of forklifts (first-time battery placement). Ninety-five percent of sales from this product category are derived from exports. Reserve power batteries are used by telecom providers, power generation companies, railway networks, utilities, etc. Also, a significant part of this product categorys sales are from abroad. Power batteries for defence applications are used by the armed forces (Navy), both in Greece and abroad, in submarine vessels and weapons systems (torpedoes). Its noted that within the year, the company proceeded with the development and marketing of new lithium batteries (Li.On Force), which incorporate IoT technology and respond to the increased market needs mainly of industrial use vehicles (eIVs). These products are derived from the utilization of the company's long-standing experience at the R&D level in lithium technology. Its clientele also includes foreign companies that are competitors in some of the above areas of activity.v The high geographic dispersion presented by the company's activities limits the risks of dependence on specific markets and contributes positively to this evaluation. Another positive factor is the quality of titleholders clientele, which includes notable and large-scale foreign companies as well as the armed forces of states. In addition to limiting credit risk, the above are also positively assessed in terms of prospects for securing future business progress.
IndustryCompetition Due to the field of activity and the strong export activity, the company's sales are not dependent on the course of the domestic GDP but on growth at a global level. Also, the course of the industry is influenced both by the development/supply of new technological products and by the total volume of replacement batteries each year due to their age. Its noted that 80% of forklifts used in the European Union are driven by motive power batteries, and in the United States the number of electrically driven forklifts is gradually increasing. Also noted is that the main volume of SYSTEMS SUNLIGHTs sales comes from replacement motive power batteries. Regarding the defence systems/applications industry, competition comes from companies in the same field of activity as the company concerned, which are based abroad (European Union, United States, etc.) In the field of motive power batteries, the company has a presence in 100 countries around the world, holding significant market shares such as those in Portugal, Italy, the Netherlands, Spain and Germany. Nevertheless, there is a risk of substitution of its products due to the existence of competitors, some being sizable companies. In the field of batteries used in defensive systems and specifically in submarines, the company concerned holds a leading position worldwide. Industry prospects are seen as positive. Future growth rates worldwide, the total number of electrically driven forklifts and trends for expanding their use even in markets such as the United States, investments in renewable energy sources and in telecommunications where energy accumulators are used have a positive impact on the industrys sales. Also, the significant growth seen in the market for energy storage solutions using lithium technologies and the use of IοT technologies is expected to have a positive impact on the future revenues of the companies in the industry. Furthermore, the expected increase in the defence expenditures of European countries participating in NATO (Germany, Romania, Baltic countries) and the maintenance of the corresponding expenditure levels by other European countries, also NATO members, at current levels as a percentage of GDP, is a factor that can lead to an increase in future revenues of companies specialising in the manufacturing of defence systems batteries. There are no serious institutional barriers to the entry of new companies into the industry. However, some more general obstacles to the entry of new competitors are posed by the requirement to develop/purchase know-how and qualified personnel, to invest in infrastructures and equipment of significant value, to create competitive products and to achieve customer recognition.
Management SYSTEMS SUNLIGHT is managed by a team of executives who have numerous years of experience in the field of business, having worked and taken positions of responsibility in both domestic and foreign companies. According to its structure, the company has been divided into independent offices with separate areas of responsibility. It has areas of financial management, sales divisions per product category, a legal and regulatory division, a human resources management department, a marketing department, a technical department as well as a production department. Its emphasized that it has a distinct R&D department, with the purpose of monitoring developments and developing new products and technologies.
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Financial Results 2018 Its noted that the company has decided on the early adoption of IFRS 16 resulting in the necessary adjustments made to the funds of the previous year for comparability purposes.
The company turnover showed a significant decrease of approximately 50% to 107.6 million (2017: 212.7 million) as a result of the aforementioned interruption of the industrial batteries production at the Xanthi plant for the last 8 months of the year due to the fire, as well as the relocation of submarine battery deliveries for 2019. A result of the above was, also, the decline in gross profit by 61% to 14.9 million with the relevant margin being formed at 13.86% (2017: 17.97%). The factory fire also had an impact on EBITDA profits which fell by about 10% to 19.8 million (2017: 21.9 million). The restraint of the decline in EBITDA occurred as the company acknowledged an extraordinary income of 58.2 million in respect to the insurance compensation within 2018. The remaining compensation amount of 7.8 million will be recognized in 2019. Its noted that the cost incurred by the fire, along with the cost of inactivity, amounted to 40.8 million, which was fully recognised within the year 2018. The company also monitors an adjusted EBITDA, in which the net accounting loss from the fire and the revenue from the insurance compensation is not calculated. The adjusted EBITDA was formed at 11.2 million. In addition, and taking into account the significant reduction of financial expenses (mainly due to the suspension of a loan interest payment as a result of the fire) of 4.9 million, the company shows profits before taxes of 11.2 million against profits of 8.9 million in 2017. Its noted that the above funds exclude the effect resulting from the companys discontinued operations and in particular the sale of the commercial retail batteries industry (TOSHIBA) to a subsidiary of OLYMPIA Group. Finally, it is noted that the results are also burdened by depreciation amounting to 3.9 million. However, despite the above significant changes, the EBITDA financial expense coverage ratio has remained at quite satisfactory levels at 4.03x from 3.41x in 2017, while the relevant indicator, taking into account the adjusted EBITDA, is formed at 2.29x.
Assets High-value investments in fixed assets mainly concern infrastructure/facilities and mechanical equipment, marking an increase as a significant part of the building facilities and equipment was replaced due to the fire. The value of the new fixed assets amounted to 28 million. Also, the company concerned has invested in subsidiaries/affiliated companies with the total value of these investments corresponding to 3.9 million, as the absorption of SUNLIGHT RECYCLING was completed and a share capital increase took place in a subsidiary in Italy. The ability to service the obligations of the company concerned depends on the smooth collection of its receivables. Total requirements show an increase to 72.7 million (2017: 59.3 million), of which trade receivables, following provisions for bad customer debts of 11.9 million, were formed at 7.9 million (2017: 43.3 million). The significant reduction in trade receivables arose mainly because of the merger with its subsidiary and on account of reduced sales due to the fire and, also, the sale of the retail batteries industry. Its noted that other receivables include an amount of 48 million related to the insurance compensation balance. From the above amount, the company has received an amount of 48 million within 2019 (in addition to the 18 million received within 2018). Its noted that part of the trade receivables is covered by documented credit/bank guarantees with the company concerned making use of credit insurance and non-redeemable factoring. On average, trade receivables are covered by various types of guarantees at a rate close to 50%, which is taken into account and has been positively evaluated in the context of this evaluation. The value of inventories amounted to 35.5 million from 24 million, mainly consisting of finished products and raw materials. They are maintained at quite acceptable levels in relation to sales at 33%, despite an increase shown against 2017. Cash outflows show a decrease (-29.9%) to 12.4 million (2017: 17.7 million). The liquidity ratio is limited to 0.14 from 0.24 in 2017.
Liabilities and Equity Liabilities have been significantly affected by the fire incident. More specifically, total liabilities amounted to 165.1 million with long-term liabilities corresponding to 75.1 million and short-term to 90 million. Of the total long-term debts, the amount of 65.6 million is for long-term borrowing, which is serviced as usual. Its noted that due to the extraordinary fire incident, there were relative waivers, for specific financial indicators, which were covenants of the loans. Also included is a corporate bond balance of 49 million payable at the conclusion of 2022 and for which the company has received all approvals from the bondholders to suspend specific commitments and for non-observance of financial indicators. Short-term financing corresponded to 38.9 million (35 million in working capital financing and 3.9 million in capital payable within 12 months). The increase concerns new financing in order to address the plant repair needs and which will be converted into long-term borrowing within 2019. Its noted that the company has recognized IFRS 16 in its statements, resulting in total borrowing to have recognised additional liabilities amounting to 3.3 million from operating leases, of which 558,400 are payable within 2019. At the end of 2018, trade receivables amounted to 25.5 million while customer advances amounted to 4.4 million (2017: 46 million and 4 million respectively). The decrease in trade receivables was mainly due to the absorption of the subsidiary and the sale of the retail battery industry, as a significant part of the receivables concerns receivables to subsidiaries and affiliated companies.
Total lending amounted to 104.6 million (2017: 78.2 million), while net lending amounted to 92.2 million (2017: 60.5 million).
The companys main indicators under review are the following:
-EBITDA/Net Financial Expenses: 4.03x from 3.41x -Adjusted EBITDA/Net Financial Expenses: 2.29x -Net Liabilities/EBITDA: 7.71x from 5.74x -Net Liabilities/Adjusted EBITDA: 13.58x -Net Debt/EBITDA: 4.66x from 2.76x -Net Debt/Adjusted EBITDA: 8.2x -Foreign/Equity Capital: 3.43x from 3.11x
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-Short-term Liabilities/Sales: 83.68% from 34.20% -Receivables/Sales: 67.58% from 27.86% -Trade Receivables/Sales: 7.32% from 20.36% -Cash Liquidity (Cash outflows/Short-term Liabilities): 0.14 from 0.24 -CFO/interest (CFO/Debt Interest and Related Expenses Paid): -4.89x from 0.83x -FCF/interest and principal [(CFO-CFI)/Debit Interest and Related Expenses Paid & Short-term Part of Long-term Loans)]: -2.29x from -0.30x
The significant increase in liabilities for 2018 was not offset by the proportionally lower equity increase due to a reduction in accumulated losses (net position: 48.1 million), resulting in a deterioration in the foreign/equity capital ratio at 3.43:1 from 3.11:1 in 2017, remaining, though, at quite satisfactory levels.
The recovery rate of trade receivables shows an improvement to 27 days from 74 days in 2017, on average, while the average repayment period of the respective receivables increased to 118 days. Average inventory recycling periods moved upward and was formed at 140 days. Consequently, the company's business cycle is encumbered at 49 days from 20 days in 2017. The increase does not justify increased financing needs of the working capital from external sources.
Cash flow Operating cash flows for 2018 were formed negatively at -23.5 million from a positive 6.4 million in 2017 due to the company's inefficient operation for the full year. The investments conducted in fixed assets (recovery of losses), the participation in the share capital increase in a subsidiary, the sale of the retail battery industry and the sale of participation in a subsidiary, in combination with the collection of part of the insurance compensation and government grants, resulted in investment inflows amounting to 3.5 million, while the repayment of loans and interest in combination with new borrowing led to financial inflows amounting to 14.5 million. Due to the aforementioned, the free cash flow amounted to -15.2 million and the final cash flows to -5.53 million, resulting in an equal decrease in cash reserves and their formation at 12.4 million.
Other important facts/Recent events At the end of 2018, the company entered into a loan agreement with the European Investment Bank (EIB) amounting to 12.5 million, with a 7-year duration, with the aim of financing the investment needs in capital equipment, working capital and R & D programs to develop solutions with new technologies in energy storage. On 2/2019 the company proceeded to establish a subsidiary company in Italy with the main activity of collecting and temporarily storing acid lead batteries, aiming at supplying the battery recycling plant in Komotini with raw materials. On 01/2019 the sale of the shares of the company and its subsidiaries was completed by its exclusive shareholder to the company OLYMPIA GROUP LTD, based in Cyprus.
Conclusion Taking into account the recently published financial data for the year 2018 as well as the most recent information primarily concerning the impact of the fire on the production unit in Xanthi, the company retains the B credit rating.
The elements forming the final classification include, but are not limited to: The companys intense export activity and its presence in several countries abroad, as well as the dedication to the development of new products even in unfavourable conditions. The clienteles dispersion and the applied credit risk management policies (credit insurance, letters of credit, factoring without reduction, etc.) The business experience of the shareholder and the management team. The investments in production structures and subsidiaries in recent years despite the overburdened domestic economic environment and the extraordinary events. The industrys prospects. The maintenance of the financial expenses coverage ratio from an adjusted EBITDA at satisfactory levels (2.29x). The maintenance of the capital structure at satisfactory levels, despite the difficult incident and the increase in obligations. The companys support, mainly from the bondholders as well as all the creditors. The collection of the insurance compensation, which ultimately surpasses the estimated damage caused by the fire, including the costs of inactivity. The elements limiting the final outcome include, but are not limited to: The decrease in activity combined with the reduction of the adjusted EBITDA results by approximately 50%. The deterioration of the net debt/adjusted EBITDA ratio to 8.2x. The deterioration of the net liabilities/adjusted EBITDA ratio to 13.58x. The deterioration of the short-term liabilities/sales ratio to 83.68%. The negative operating and free cash flows that significantly aggravate the coverage indicators.
Upgrade Scenario ICAP may consider upgrading the titleholder's credit rating in the following circumstances, which are indicative and not limited to: -The improvement of the companys financial results, particularly sales and the adjusted EBITDA. -The strengthening of the net financial expenses coverage ratio from adjusted EBITDA to levels above 3.5x. -The strengthening of the net debt/adjusted EBITDA ratio to levels below 3.5x. -The improvement of the net liabilities/adjusted EBITDA ratio to levels below 5x. -The improvement of the leverage ratio to levels below 0.70:1. -The reduction of short-term bank lending and its formation close to 2017 levels. -The strengthening of operating cash flows and the existence of positive free cash flows covering interest and capital by at least 1x.
Downgrade Scenario
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ICAP may consider further downgrading the titleholder's credit rating in the following circumstances, which are indicative and not limited to: -The further decrease in turnover and the adjusted EBITDA. -The deterioration of the net financial expenses coverage ratio from adjusted EBITDA to levels below 2x. -The deterioration of the net debt/adjusted EBITDA ratio to levels above 4x. -The deterioration of the net liabilities/adjusted EBITDA ratio to levels above 7x. -The deterioration of the leverage ratio to levels above 0.85:1. -The increase in short-term bank lending and its formation close to 2018 levels, without being justified by the company's growth prospects and the implementation of an investment plan. -The existence of negative operating and free cash flows. -Any cause for the non-continuation of the established agreements with the bondholders.
Its noted that the factors mentioned above, which may lead to an upgrading or downgrading of the assigned rating, do not operate independently but are taken into account in combination with each other and with additional factors, in proportion to the available information and the overall macroeconomic situation in the Groups countries of operation at the time of the evaluation.
Information Sources • Company's Management • Financial Statements • Business Registry • Trade Sources • ICAP DataBank Data
Company participated in the rating process by providing publicly available information for the assignment of the ICAP Credit Rating. Information provided has been verified regarding its validity and accuracy from the data sources stated above.
The quality of the available information regarding the rated company is deemed as satisfactory for the credit rating assignment.
Use of ICAP ancillary services The rated company is using at least one of the following ICAP services - Business Information, Credit Risk & Credit Watch and Marketing Solutions.
Transaction Behaviour Index
Subject
Final Result: 5 Stars (5.00)
Detrimental Score Evolution (Per activity group) 2019 2018 2017 2016 2015 Group 1: 5*(5.00) 5*(5.00) 5*(5.00) 5*(5.00) 5*(5.00) Group 2: 5*(5.00) 5*(5.00) 5*(5.00) 5*(5.00) 5*(5.00) Group 3: 5*(5.00) 5*(5.00) 5*(5.00) 5*(5.00) 5*(5.00)
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2019 2018 2017 2016 2015 Total : 5*(5.00) 5*(5.00) 5*(5.00) 5*(5.00) 5*(5.00)
Index: 5*, 4*, 3*, 2*, 1*, NA (Not applicable)
Transaction Behaviour Profile
Subject's business transaction profile has not been affected by any incidents up to 17.07.2019. Recommended Credit Limit
Last We recommend a maximum credit limit of Euro 11,829,000. Previous We recommend a maximum credit limit of Euro 11,829,000. (14/5/2019) Company History
Established in Athens, on 06.05.94 On 2/7/1998 (Gov. Gaz. No. 05186/1998) a change of subject's head office was published. On 25/7/2006 (Gov. Gaz. No. 08167/2006) a change of subject's head office was published. On 25/7/2006 (Gov. Gaz. No. 08167/2006) the company's name was changed. On 5/10/2006 (Gov. Gaz. No. 10931/2006) subject absorbed a sector of the firms(s) GERMANOS S.A. On 4/11/2011 (Gov. Gaz. No. 11682/2011) a change of subject's head office was published. On 25/6/2013 (Gov. Gaz. No. 03748/2013) a change of subject's head office was published. On 3/8/2018 (Business Registration Number:1440614/3.8.2018) the company's name was changed. On 30/11/2018 (Business Registration Number:1583412/30.11.2018) subject absorbed the firm(s) SUNLIGHT RECYCLING S.A. (2007). SUPPLEMENTARY DATA ON THE ABOVEMENTIONED EVENTS PUBLISHED IN THE GOV.GAZ.:Prior to the change that was published in the Gov.Gaz.No.:8167/06 subject's name was ARION S.A. The Gov.Gaz.No.: 10931/06 refers to the absorbtion of the sector of the sector of manufacture and trade of battaries of the firm GERMANOS SA. Prior to the change that was published in the Business Registration No: 1440614-3/8/2018 subject's name was SYSTEMS SUNLIGHT INDUSTRIAL & COMMERCIAL COMPANY OF DEFENSIVE ENERGY ELECTRONIC & TELECOMMUNICATIONS SYSTEMS S.A. . Premises (as declared)
Head office • 2 Ermou & Nikis, 105-63 Athens, Attiki. Plant • Neo Olvio, 672-00 Evlalo, Xanthi, owned, plot of land 142,000 m2, Buildings: 55,000 m2. • Industrial Region, 691-00 Komotini, Rodopi, owned, plot of land 42,000 m2, Buildings: 21,000 m2. Installations • Messochora, 700-10 Pyrgos, Irakleio, rented. Workshop • 14A Menexedon, 145-64 Kifissia, Attiki, rented.
On 25/02/2013 subject's head office was changed. Previous address : Athinon -Lamias national Road (23rd km), 145-65, Agios Stefanos, Attiki
In Messochora, Irakleio, Crete subject maintains a photovoltaic park.Part of the production facilities in Xanthi was destroyed by fire on 01/05/2018. The factory of Komotini's Industrial Region is in operation by December of 2014. Personnel
According to the latest data the company employs: 815 persons.
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Activity
Manufacturing, assembly, representations, imports and wholesale trade of advanced technology cells and batteries, industrial cells and batteries and chargers. Recycling of batteries. Production of polypropylene and industrial gases. Energy projects. Technical support Activity NACE (Main)
NACE 1 3140 Manufacture of accumulators, primary cells and primary batteries NACE 2 2720 Manufacture of batteries and accumulators
Certifications
ISO Certificate OHSAS 18001:2007 Testifying Company TUV HELLAS (TUV NORD) S.A.
ISO Certificate ISO 9001:2008 Testifying Company TUV HELLAS (TUV NORD) S.A.
ISO Certificate ISO 37001: 2016 Testifying Company TUV HELLAS (TUV NORD) S.A.
ISO Certificate ISO 14001 Testifying Company TUV HELLAS (TUV NORD) S.A.
Products - Services
Manufacturing Batteries EM Polypropylene EM Battery recycling Gases, industrial Machinery repairs EM Batteries, industrial EM Commercial Batteries ET,I,A Services Industrial energy works Technical works EY
Symbol Interpretation EM = Exports manufacturing FT = For third parties A = Representation
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ET = Exports commerce F = In third party facilities D = Local agent EY = Exports services I = Import
Trademarks
Sunlight Reliable Battery Solutions Sunlight Sunlight Recycling Imports
Countries Belgium, Bulgaria, China, Germany, Italy, Japan, Luxembourg, Netherlands Imports percentage 85% Comments Import Terms: 80 days, either open credit or LCs Terms Open credit 80 days Exports
Countries Throughout the world Export sales percentage 80% Terms C.A.D. Bill of exchange 90 days Open credit 90 days Suppliers
• KCM (Bulgary) • NIZI INTERNATIONAL (LUXEMBOURG) Customers
Subject operates a network of local agents. Subject's clientele includes 700 firms both in Greece and abroad as well as the Greek State. Among them the following are noted:
• GREEK NAVY, Public Organizations & Services • NATIONAL BANK OF GREECE S.A., Banks, (Athens, Attiki) • EUROBANK ERGASIAS S.A., Banks, (Athens, Attiki) • ALBANIA MOBILE TELECOMMUNICATION (Albania) • ATLAS ELEKTRONIK GMBH (GERMANY), , (Germany) • BULGARIA TELECOMMUNICATION CO (Bulgaria) • COMMISION FEDERALE DE ELECTRICIDAD (Mexico) • IBERIA / SPAIN • ROMANIA ELECTRICA (Romania) • TKMS SHIPYARD - HDW GMBH (Germany) • PUBLIC POWER CORPORATION S.A., Energy - Water, (Athens, Attiki) • HELLENIC POST (ELTA) S.A., Post, (Athens, Attiki) • HELLENIC RAILWAYS ORGANIZATION S.A., Transportation Services, (Athens, Attiki) • HELLENIC TELECOMMUNICATIONS ORGANIZATION S.A., Telecommunications, (Maroussi, Attiki) Banks
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Alpha Bank A.E. • Nea Ionia Branch (tel.:2102754962) (Deposits-Loans-Imports)
Bank of Piraeus S.A. • Head Office (tel.:2103335410)
EUROBANK ERGASIAS S.A. • Plaka Branch (tel.:2103220555) (Deposits-Loans-Imports)
National Bank of Greece S.A. • Head Office (tel.:2103341234) (Deposits-Loans-Imports)
General Comments
Subject is an economic unit that was acquired on 6/2006 by GERMANOS SA, which was controlled by the entrepreneur Panos Germanos. At the same time, the company absorbed GERMANOS SA's industrial and commercial battery industry. It is noted that on 9/2006, GERMANOS SA was acquired by the COSMOTE Group, with all the shares of SUNLIGHT SYSTEMS being held by Mr. Panos Germanos. Subject is engaged in the production of traction batteries, batteries, back-up batteries and batteries for defense applications as well as integrated energy systems, special purpose batteries and APS systems.The company has a strong export activity with over 80% of turnover coming from sales abroad. Its customers are active in the field of industry, transport, telecommunications, information technology and construction. Also included in the clientele are the Armed Forces (Navy) of various countries.Ιt is noted that on 01/05/2018, a fire occurred at the company's production facilities in Xanthi and extensive damage to key battery lines has occurred. At the same time on 02/05/2018, the Securities and Exchange Commission announced the suspension of trading of all subject΄s bonds on the ASE. Subject on 21/05/2018 has announced that the affected battery line and mainly the submarine battery line and the industrial batteries has contributed to a large proportion of its annual turnover and for this reason subject was looking for alternatives to serve its customers and reduce losses in its turnover. Battery production lines for defense use have not been substantially affected as they have suffered only limited damage. The company requested the withdraw of the suspension of the trading of its bonds and it was accepted from the Securities and Exchange Commission on 22/05/2018. The total final cost of the accounting loss from the damaged assets (tangible fixed assets and inventories) eventually amounted to Euro 32,6 million In addition, the affected facilities were adequately insured for any damage by a consortium of 8 insurance companies. Ultimately, the insurance indemnity decided in December 2018 amounted to Euro 66 million which was fully collected in 2019. The insurance cover both damage to fire and future loss of profit. The incurance payment has already been used together with existing own funds to restore as soon as possible the operation of the production unit. The re-operation of the submarine battery line was achieved in September 2018, and the line of the industrial batteries industry was restored in October 2018 with a view to its complete restoration in June 2019. Furthermore, it is noted that by 2018 the company's consumer battery sector was sold for an amount Euro 5,4 million. Moreover, it is mentioned that the company holds certificate 19600 for regulatory compliance. Group Data
The company according to the consolidated balance sheet as at (31/12/2018)belonged to: (SYSTEMS SUNLIGHT S.A. INDUSTRIAL CO OF DEFENSIVE ENERGY ELECTR & TELECOM SYSTEMS GROUP OF COMPANIES) ICAP ID: 10075164 The company according to the consolidated mid-term statement as at (30/06/2018)belonged to: (SYSTEMS SUNLIGHT S.A. INDUSTRIAL CO OF DEFENSIVE ENERGY ELECTR & TELECOM SYSTEMS GROUP OF COMPANIES) ICAP ID: 10075173 Shareholders (as declared)
By 100.00% OLYMPIA GROUP LTD Code Number : 10866785 Sector : Holding Companies Capital : 1,000 Head office : Cyprus
Up to the beginning of 2019, the sole shareholder of the company was OLYMPIA GROUP SA HOLDING with 100%.
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Board of Directors
Basil Ang. Billis Chairman, CEO Dimitrios Geo. Goumas Vice-Chairman Michail Kon. Mastorakis Member Stergios Geo. Nezis Member John Ody. Pantoleon Member Roumben Eli. Bourlas Member Alexandros Ste. Manos Member Spyridon Joh. Kopolas Member Stefanos Ana. Kanidis Member Lambros Spy. Bisalas Member Participations
Subject participates in the following firm(s):
by 100.00% SUNLIGHT INDUSTRIAL SRL ICAP ID 0321331 Head office Sos. Centurii Nr.11, Bragadiru, Ilfov, Bragadiru 077025,, Romania Date established 2001
by 100.00% ECORBA SRL ICAP ID 10867100 Head office VIA STRA' 175 COLOGNOLA AI COLLI VERONA 37030 ITALY, Italy Date established 2019
by 90.00% RELIABLE BATTERY SOLUTIONS SRL ICAP ID 10268783 Head office Italy Date established 2017
by 51.00% ADVANCED LITHIUM SYSTEMS EUROPE S.A. ICAP ID 0985610 VAT 998385266 Head office 2 Ermou & Nikis, 105 63, Athens, Attiki Date established 2010 Sector Industry (Electric - Electronic Material) Share Capital 200,000 Total Equity 2,179,849 Losses before taxes -905,816 Balance sheet details as at 31.12.2017 in Euro.
by 30.00% SUNLIGHT ITALY SPA ICAP ID 1060798 Head office Italy Date established 2009
by 24.00% TECHNOFORM S.A. ICAP ID 0191542 VAT 099799848 Head Office - Workshop Kilkis - Thessalonikis National Rd 10 km Komvos Pedinou, 611 00, Kilkis Date established 2001 Sector Industry (Metal Products & Structures) Capital (Share) 1,874,000 Owners Equity 2,841,874
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Net Sales 3,984,836 Net Profit before taxes 421,016 Balance sheet details as at 31.12.2015 in Euro.
Financial Information
The share capital of the company amounts to Euro 44,394,950 divided into 15,151,860 shares at EURO 2.93 each.
Mid-Term Accounting Statement Data Accounts 1/1/2018 - 30/6/2018 1/1/2017 - 30/6/2017 Shareholders Equity 21,559,114 44,878,389 Total Assets 158,615,369 193,791,860 Net Sales 89,645,807 109,166,024 Profit Before Income T -31,968,219 6,163,062
Values in Euros
The financial data are presented according to the International Financial Reporting Standards. Financial Comments
Noted that the value of owned premises are included in the account BUILDINGS/INSTALLATIONS in subject's balance sheets. 2017 balance sheet accounts have been reformed. Balance Sheet Notes
• Subject's recent financial statements are published according to IAS/IFRS. Due to that reason, comparisons with previous fiscal years in which company published its balance sheets according to Greek Financial Standards are not presented. • Type of Auditor's Audit Report for the Financial Statement ended 31/12/2018 : Unqualified opinion Type of Auditor's Audit Report for the Financial Statement ended 31/12/2017 : Unqualified opinion Type of Auditor's Audit Report for the Financial Statement ended 31/12/2016 : Unqualified opinion Short Length Financial Statement
ASSETS
31/12/2018 Change 31/12/2017 Change 31/12/2016 Accounts '18 - '17 '17 - '16 (%) (%) IFRS IFRS IFRS Fixed Assets 92,595,564 -0.09 92,676,858 5.91 87,506,105 Buildings / Means of Transport / Furniture and Other Equipment 51,445,481 38.03 37,269,948 14.49 32,553,497 Machinery and Mechanical Equipment 47,122,716 -11.37 53,168,232 4.41 50,922,733 Intangible Assets and Establishment Expenses 9,566,863 4.92 9,118,539 2.97 8,855,592 Accumulated Depreciation 31,310,795 -22.02 40,153,875 18.01 34,025,753 Depreciation of Buildings / Furniture / Means of Transport 8,318,645 -8.56 9,097,880 22.62 7,419,341 Depreciation of Machinery and Mechanical Equipment 15,090,071 -35.67 23,458,374 19.23 19,675,345 Depreciation of Intangible Assets and Establishment Expenses 7,902,079 4.01 7,597,621 9.62 6,931,067 Long Term Receivables 11,811,206 -1.75 12,021,167 -5.64 12,739,503 Participations 3,960,093 -81.37 21,252,847 29.11 16,460,533 Inventories 35,547,012 47.79 24,052,521 22.66 19,609,609 Finished Products / Merchandise 15,908,579 19.43 13,320,167 17.20 11,365,448 Semi finished Goods 450,994 128,755.43 350 -99.86 257,374
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31/12/2018 Change 31/12/2017 Change 31/12/2016 Accounts '18 - '17 '17 - '16 (%) (%) Raw Direct and Indirect Material 19,187,439 78.79 10,732,004 34.37 7,986,787 Receivables / Transit balances 72,686,947 32.04 55,050,059 32.66 41,497,144 Receivables from Customers / Bills and Cheques 7,867,886 -81.83 43,300,115 42.92 30,295,494 Other Receivables / Transit Debit Balances 64,819,061 451.65 11,749,944 4.89 11,201,650 Cash and Deposits 12,387,357 -29.85 17,659,479 173.46 6,457,907 Total Assets 213,216,880 12.55 189,438,917 22.16 155,070,765
LIABILITIES
31/12/2018 Change 31/12/2017 Change 31/12/2016 Accounts '18 - '17 '17 - '16 (%) (%) IFRS IFRS IFRS Owners Equity 48,087,470 4.28 46,115,648 18.64 38,868,571 Share Capital 44,394,950 0 44,394,950 0 44,394,950 Reserves 106,040,144 -0.09 106,135,783 -0.01 106,150,732 Retained Earnings / Losses -102,347,624 1.98 -104,415,085 6.50 -111,677,111 Long Term Liabilities and Provisions 75,125,520 6.44 70,580,049 61.60 43,676,539 Long Term Liabilities 73,873,113 6.31 69,490,725 62.52 42,757,755 Provisions 1,252,407 14.97 1,089,324 18.56 918,784 Current Liabilities / Transit Balances 90,003,890 23.73 72,743,220 0.30 72,525,655 Short Term Bank Debt 38,901,327 154.65 15,276,531 -36.34 23,999,136 Suppliers / Bills Notes Payable and Cheques / Creditors 25,459,839 -44.60 45,957,957 26.72 36,268,714 Other Liabilities / Transit Credit Balances 25,642,724 122.81 11,508,732 -6.11 12,257,805 Total Liabilities and Net Worth 213,216,880 12.55 189,438,917 22.16 155,070,765
Values in Euros Profit & Loss Statement
1/1/2018 - Change 1/1/2017 - Change 1/1/2016 - Accounts 31/12/2018 '18 - '17 31/12/2017 '17 - '16 31/12/2016 (%) (%) IFRS IFRS IFRS Net Sales 107,533,735 -49.45 212,721,366 26.29 168,434,865 Cost of Net Sales 92,622,772 -46.92 174,495,806 27.73 136,614,669 Gross Margin 14,910,963 -60.99 38,225,560 20.13 31,820,196 Commission and Other Operating Income 61,723,813 5,463.54 1,109,433 -25.91 1,497,341 Interest Expenses 4,916,582 -37.91 7,918,405 8.20 7,318,324 Other Operating Expenses 60,544,989 169.49 22,466,610 8.39 20,728,241 Operating Results after Interest Expenses 11,173,205 24.84 8,949,978 69.80 5,270,972 Non Operating Income 1,654,082 5,253.02 30,900 N/A Total Depreciation 3,935,477 -21.95 5,042,025 8.48 4,647,998 Depreciation Included in the Operation Cost 3,935,477 -21.95 5,042,025 8.48 4,647,998 Net Income for the Year Before Tax 12,827,287 42.83 8,980,878 70.38 5,270,972 Income Tax -524,762 67.16 -1,597,782 -318.63 730,819 Profit / (Loss) Before Tax, Financing and Investing Results 19,802,106 -9.60 21,904,204 27.21 17,218,790 and Depreciation-Amortisation (EBITDA)
Values in Euros Company Ratios
PROFITABILITY RATIOS
31/12/2018 Change '18 - '17 31/12/2017 Change '17 - '16 31/12/2016 Ratios (%) (%) Return on Equity (Before Income Tax) (%) 27.23 28.81% 21.14 44.00% 14.68
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31/12/2018 Change '18 - '17 31/12/2017 Change '17 - '16 31/12/2016 Ratios (%) (%) Return on Equity (Before Interest and Income Tax) (%) 37.67 -5.28% 39.77 13.43% 35.06 Return on Capital Employed (Before Interest and 8.81 -10.19% 9.81 19.49% 8.21 Income Tax) (%) Gross Profit Margin (%) 13.87 -22.82% 17.97 -4.87% 18.89 Operating Profitability (%) 14.76 86.13% 7.93 6.30% 7.46 Net Profit Margin (Before Income Tax) (%) 11.93 182.70% 4.22 34.82% 3.13 Net Profit Margin EBITDA (before Interest, Income Tax, 18.41 78.74% 10.30 0.78% 10.22 Depreciation and Non Operating Income) (%)
CAPITAL STRUCTURE AND VIABILITY RATIOS
31/12/2018 Change '18 - '17 31/12/2017 Change '17 - '16 31/12/2016 Ratios (%) (%) Financial Leverage (:1) 0.77 1.32% 0.76 1.33% 0.75 Total Debt Equity Ratio (:1) 3.43 10.29% 3.11 4.01% 2.99 Interest Coverage (Before Interest and Income Tax) 3.61 69.48% 2.13 23.84% 1.72 (X)
LIQUIDITY RATIOS
31/12/2018 Change '18 - '17 31/12/2017 Change '17 - '16 31/12/2016 Ratios (%) (%) Current Ratio (Χ) 1.34 18.58% 1.13 21.50% 0.93 Quick Ratio (Acid Test) (Χ) 0.97 16.87% 0.83 20.29% 0.69 Working Capital (EURO) 30,617,426 27.47% 24,018,839 584.15% -4,960,995
ACTIVITY RATIOS
31/12/2018 Change '18 - '17 31/12/2017 Change '17 - '16 31/12/2016 Ratios (%) (%) Collection Period (DAYS) 87 38.10% 63 3.28% 61 Payable Period (DAYS) 141 63.95% 86 4.88% 82 Inventory Turnover (DAYS) 117 154.35% 46 2.22% 45 Equity Turnover (Χ) 2.28 -54.49% 5.01 6.82% 4.69 Turnover of Capital Employed (Χ) 0.53 -56.91% 1.23 11.82% 1.10
Sector Ratios
PROFITABILITY RATIOS
2018 Change '18 - '17 2017 Change '17 - '16 2016 Ratios (%) (%)
Return on Equity (Before Income Tax) (%) 2.32 -32.16% 3.42 182.64% 1.21 Return on Equity (Before Interest and Income Tax) (%) 3.72 -64.44% 10.46 61.17% 6.49 Return on Capital Employed (Before Interest and 1.41 -65.27% 4.06 63.05% 2.49 Income Tax) (%) Gross Profit Margin (%) 8.50 -46.27% 15.82 -8.61% 17.30 Operating Profitability (%) 5.66 -46.27% 4.41 -8.61% 3.03 Net Profit Margin (Before Income Tax) (%) 3.95 153.20% 1.56 113.70% 0.73 Net Profit Margin (before Interest, Income Tax, 8.20 10.07% 7.45 9.24% 6.82 Depreciation and Non Operating Income) (%)
ACTIVITY RATIOS
2018 Change '18 - '17 2017 Change '17 - '16 2016 Ratios (%) (%) Collection Period (DAYS) 257.00 250.33% 73.36 -28.74% 102.95 Payable Period (DAYS) 256.09 249.61% 73.25 -25.16% 97.88 Inventory Turnover (DAYS) 302.93 258.50% 84.50 -21.02% 106.99 Equity Turnover (Χ) 0.59 -72.94% 2.18 32.12% 1.64 Turnover of Capital Employed (Χ) 0.22 -74.12% 0.85 34.92% 0.63
CAPITAL STRUCTURE AND VIABILITY RATIOS
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2018 Change '18 - '17 2017 Change '17 - '16 2016 Ratios (%) (%) Financial Leverage (:1) 0.64 4.84% 0.62 1.64% 0.61 Total Debt Equity Ratio (:1) 1.82 13.75% 1.60 3.90% 1.54 Interest Coverage (Before Interest and Income Tax) 2.65 77.85% 1.48 21.14% 1.23 (X)
LIQUIDITY RATIOS
2018 Change '18 - '17 2017 Change '17 - '16 2016 Ratios (%) (%) Current Ratio (Χ) 1.20 1.69% 1.18 -2.48% 1.21 Quick Ratio (Χ) 0.82 1.23% 0.81 -4.70% 0.85 Working Capital (EURO) 62,985,377.83 -45.14% 114,806,533.69 -25.71% 154,530,397.20
Sector Sample of Companies
2018 2017 2016 Number of Companies 8 156 164
The sample of companies of the sector examined consists of companies that have published a Balance Sheet for the respective year. Interpretation of Balance Sheet Symbols
• When the minus sign (-) appears to Income Tax Payable account or to other Tax accounts indicates a tax obligation, while the opposite signifies a tax return. • Some ratios are calculated using the average value of the accounts of the Balance Sheet or Midterm Statements. For applying this type of calculation, financial statements must be presented in succession, with common accounting standards (either Greek Standards or IFRS or GFS) and with the same depth of analysis. In the opposite case, the corresponding ratios are calculated based on the accounts as at they are presented in the reporting year. • N/A: Not Available • N/C: Not Calculable • The indications N/A and N/C may appear in cases where accounts that participate in the computation of the ratios or in the accounts changes are not detected in the original balance sheet as well as the computation of certain ratios does not have a meaning i.e. Return on Equity ratio or Total Dept Equity ratio when Equity is negative, etc.
Company Ranking in Sector
Subject, among 8 sample of companies of its sector Industry (Electric - Electronic Material), was ranked as follows, based in 2018 B/S details :
Ranking Fixed Assets 1 Total Fixed Assets 1 Equity Capital 1 Total Income 1 Net Income for the Year Before Tax 1
ICAP Sector Studies
RENEWABLE ENERGY SYSTEMS
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Below are mentioned in brief the basic points of the sector study, conducted by ICAP's Research and Financial Studies Department in year 2018:
Sectors general data Currently only a small number of companies operate in imports, study and installation of photovoltaic systems in Greece. As regards wind power, the number of wind turbine suppliers that operate is small. The annual installed capacity of photovoltaic systems in Greece reported an impressive development during 2011-2013. Since then it has registered a sharp fall and was particularly low in 2017. This "downfall" of the market is mainly due to the lack of funding and the structural changes in the institutional framework. Solar panels accounted for 50% of the domestic market of photovoltaic systems (based on value) in 2017. The annual installed capacity of wind systems recovered in 2016, while it registered a slight fall in 2017.
Full and detailed data for the above mentioned sector are included in the relevant sector study of ICAP, which is available through our Sales & Marketing Department.
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