Account Profile As of September 5, 2022 Account Name: ABL Marketing Corporation Address: 15 Sct. Dr. Lazcano St., Diliman, Quezon City Nature of Business: Retail and wholesale of household appliances Principal Owners: Frederick U. Reynes (66 years old) - President and CEO (68%) Alicia Lenie E. Reynes, CPA (64 years old) - VP for Finance (20%) Engr. Fred Aiko E. Reynes (44 years old) - VP for Operations (5%) Atty. Alice Jillian Reynes-Domingo (39 years old) - Corporate Secretary (5%) Patrick S. Domingo (37 years old)- Member of the Board of Directors (2%) Background 1. ABL Marketing Corporation is a family-owned corporation which is engaged in the retail and wholesale distribution of household appliances. 2. It started as Robust Rose Corporation in 1988 under the management of the Reynes family where the siblings Frederick and Jessie were trained as successors. It was engaged in the retail and wholesale trade of furniture and household appliance. In 1995, they took over the business (Frederick as the President and CEO, while Jessie as the COO). However, in 2002, due to some personal issues related to the handling of finances and tax payments, the brothers parted ways and decided to close shop. However, Frederick, the younger brother, decided to keep the household appliance distribution business. He then started ABL Marketing the year after and asked his wife and children to help. 3. Originally from Bicol, Frederick U. Reynes graduated from the Ateneo de Naga University with a degree in Business Administration major in Marketing Management. Right after graduating from college, he joined the family business as a Marketing Manager and later was appointed as the President and CEO. 4. On the other hand, Alicia Reynes is a Certified Public Accountant and a graduate of BS Accountancy from the Far Eastern University. Before marrying Frederick, she worked for PWC Philippines - Isla Lipana & Co. as a Senior Assurance Associate. She is the current VP for Finance of their company.a Senior Assurance Associate. She is the current VP for Finance of their company. 5. Furthermore, Engr. Fred Albert E. Reyes is an Electrical Engineer and a graduate of the University of the Philippines Diliman. He previously worked as an overseas worker in Dubai but decided to help in the family business. In addition, Atty. Alice Jasmine Reynes - Domingo is the current Corporate Secretary. She finished her Philosophy degree from the University of the Philippines Diliman and pursued law at the San Beda University School of Law. Prior to joining their company, she had five-year stint at the Bernardo Placido Chan and Lasam Law Firm. She is married to Patrick S. Domingo who previously worked for the Metropolitan Bank and Trust Company as a Senior Assistant Vice President and Team Head under the Commercial Lending Banking Group. 6. Main products include air-conditioning units, electric fans, rice cooker, induction cooker and microwave oven. During summer, most of their sales come from electric fans and air-conditioningunits while during December, most of their sales come from rice cooker and microwave oven. 7. They usually have P100MM-worth of inventory at any given time. These supplies come from the following: a. Concepcion Durables - credit term: 30-60 days b. Electronics Excellence - credit term: COD-60 days C. First Philippine Marketing - credit term: 30-60 days d. Xmart Manufacturing - credit term: 60-90 days e. M&L Tricorner Manufacturing - credit term: 30-60 days 8. On the other hand, their top 5 customers include the following: a. My Home - credit term: 90 - 150 days b. Appliance Central - credit term: 90- 180 days C. Home Applianz - credit term: 60 -90 days d. Gizmoz Appliance Center - credit term: 30- 60 days e. Utopian Appliance Center - credit term: COD - 60 daysCurrently, the client's creditor banks are the Philippine National Bank and Security Bank where they have the following facilities: 10. 11. 12. 13. 14. 15. 16. 1?. Bank Facility Amount Balance Collateral Remarks Security Bank Working P30 Million P20 Million Comprehensive Expiry: September 30, Capital Line Surety ,l Real Estate 2023 Mortgage Philippine Working P20 Million P10 Million Comprehensive Expiry: September 30, National Bank Capital Line Surety 2023 TOTAL P50 Million P30 Million For the year 2021, they recorded a P500MM sales which is 20% higher than their 2020 sales of P500M but still behind their 2019 sales of P800MM. This is both for the wholesale and retail sale [both online and in store}. Gross Profit Margin was at 30% and Net Profit Margin at 10%. For their retail business, they have their physical store along Timog Avenue under the name ABL Appliance Shop which is a 500 sqm building owned by Sps. Reynes. For their wholesale business, they have 5 delivery trucks that deliver to their clients within MetroManila. Client has been a depositor since 2010. Their usual deposit balance is around P30 Million. They also have a time deposit under the name of Sps. Frederick and Alicia Reynes in the amount of P50 Million. Aside from our bank, they also have bank accounts with Security Bank and Philippine National Bank. Client disclosed that moving forward, they plan to work with the large appliance stores; hence, the need to beef up their inventory. In turn, they need to have a bigger space. In fact, they have just sealed a deal with Waltermart Corporation where they will supply appliances for the former'sdepartment stores in Metro Manila. Hence, they are looking at purchasing and renovating a 1000 sqm warehouse along Fernando Poe Jr. Avenue (formerly Roosevelt Avenue), Quezon City which is for sale for P20MM. Terms of payment shall be an upfront payment of 50%of the total contract price, 25% on the cancellation of the annotation of encumbrance of the Bank of the Philippine Islands, and the remaining 25% once the title has been transferred to Sps Frederick and Alicia Reynes. Based on the credit checking, there were several closed credit cards under the name of Frederick and Engr. Fred in 200?. These cards were under Citibank and PIE-Com. Clients said that these cards were given to them voluntarily by the said banks, but they had disputes with the balance. Aside from this, there are also a court case in 2002 for Sum of Mony. Per Frederick Reynes, this was when he had issues with his brother on the case in 2002 for Sum Of Mony. Per Frederick keynes, this was when he had issues with his brother on the handling of finances of their previous company. But he submitted a certification that the same as already been settled via a compromise settlement in 2003.fs 18. However, just like any other business, the clients were greatly affected by the implementation of the number of quarantine restrictions since March 17, 2020. Despite the challenges in operations in 2020, they were able to slowly recuperate in 2021 as Metro Manila eases to a more lenient quarantine restriction. However, they again had issues when Delta and Omicron cases peaked in Metro Manila. 19. As additional safety precaution, they requested their employees to be vaccinated via their LGUs as they did not have sufficient funds to procure their own vaccines. Instead, during the peak of cases, they shouldered the COVID tests of their employees and even provided care kits for their employees who got sick because of the virus. 20. In response to the changing landscape in sales, they started their own online store via their website and other e-commerce platforms in July 2021. It became in full force by September 2021 in time for the anticipated peak sales in the 4" quarter of 2021. 21. However, despite the more lenient restrictions, their workforce are still not 100%. Some of their HR and admin staff are mostly working from home but the operations need to be onsite to oversee logistics and distribution concerns. 22. Currently, they have 80 employees where 50 are regular and 30 are contractual. 23. During the initial quarantine period, they asked for leeway from their suppliers on the collection of receivables. Fortunately, they were given at least additional 60 daysof deferment on payments on top of their current credit terms. As of 2021, they were able to fully pay all of their deferred payments to their suppliers. 24. Also, in 2020, they asked for a 90-day extension of rental payments on their current warehouse along Panay Avenue which they lease for P100K per month. They were able to pay all the deferred rental payments in 2021. 25. However, they are still set to collect around P20M worth of past due receivables from their customers. These are their customers that initially asked for deferment in 2020 but are still not able to fully recuperate in 2021