WELLCAL AS PER 2014 ANNUAL REPORT

PROFILE

• Mandrel type products include air hose, food hose, water hose, sand blast hose, automobile hose, petroleum oil hose, protective cover hose, general wash down hose.
• Extrusion type products include air hose, water hose, welding hose, fire reel hose, automobile hose, multipurpose hose, petroleum hose and general wash down hose. 
• The company exported approximately 97% of its rubber hose to Middle East, Europe, US, Canada, Australia, New Zealand, Asia, Africa and South America.

Geographical Segment
Year/Percentage	2015	Percentage	2014	Percentage	2013	Percentage
Malaysia	14,134	8.94%	14,148	9.67%	12,007	9.13%
Middle East	21,833	13.81%	20,991	14.34%	18,770	14.27%
Europe	22,718	14.37%	21,512	14.70%	19,155	14.56%
USA/Canada	32,049	20.27%	28,159	19.24%	18,440	14.02%
Australia/New Zealand	17,742	11.22%	14,304	9.77%	12,564	9.55%
Asia	34,316	21.70%	30,825	21.06%	29,404	22.36%
South America	11,135	7.04%	12,825	8.76%	17,998	13.68%
Africa	4,185	2.65%	3,599	2.46%	3,192	2.43%
	158,112	100.00%	146,363	100.00%	131,530	100.00%

STRENGTH

• Net cash company with 40 million cash in bank.
• Selling rubber hose to 6 major application markets - air and water, welding and gas, oil and fuel, automobile, ship building, food and beverage. 
• 50% of net profit dividend policy (high dividend yield company)
• Declining cost of latex  
• 90% of its sales are from export
• Benefit from the introduction of GST where the company used to pay 10% service tax where the GST system has reduced the tax down to 6%
• Strong ROE @ 42%
• Improve in cost efficiency where profit margin of the company increased.
• The company has consistently grow and improve over the 5 years. 

WEAKNESS

• High PE of 22 where the price might reflect its value? 
• Profit margin and sales might drop when RM strengthen and raw materials cost increase.

FUTURE PROSPECT

• Constructing a 3rd factory production line which will increase the production from 35000 tons to 45000 tons. 
• Rubber compounding machine will be install in the new production factory where WellCal can enjoy a better margin. (this segment is currently outsourced)