Bangkok--22 Jul--TRIS Rating TRIS Rating Co., Ltd. has affirmed the company rating of I.C.C. International PLC (ICC) at “AA” with “stable” outlook. The rating reflects ICC’s debt-free status, proven capability and experience of its management team, a diverse range of products and brands, and its position as Thailand’s leading distributor of lingerie, men’s apparel, and cosmetics. ICC has a strategy to gradually develop its own specialty stores while keeping good relationships with both traditional and modern trade distribution channels. TRIS Rating expects this strategy will help the company sustain its strong market position. The rating also takes into consideration the low profitability typically associated with trading companies, the slowdown in private consumption, declining consumer confidence, and the complex shareholding structure of the Saha Group. The “stable” outlook reflects TRIS Rating’s expectation that ICC will maintain solid market shares across its product lines, despite intense competition. A conservative financial policy is the keystone of the company’s rating. TRIS Rating reported that ICC is one of Thailand’s largest wholesalers and distributors, distributing and marketing consumer products, particularly lingerie, apparel, and cosmetics. The company offers more than 100 brands, under both foreign brands and its own brands. Most of its brands, such as Wacoal, Arrow, Lacoste, Guy Laroche, ELLE, and Itokin, are well accepted by Thai consumers. The competence and experience of ICC’s management team, together with support from suppliers within the Saha Group, has made the company a leading distributor in Thailand and allowed it to maintain its market-leading positions. ICC is the clear leader in the middle- to high-end lingerie market, with a combined market share of 66%, measured as sales through department stores. Wacoal products are a major contributor, with a market share of around 58%. The success of Lacoste and Arrow products has sustained growth in sales of men’s apparel since 1998. Men’s apparel now makes up a large portion of total sales, rising from 25% in 2002 to 31% in 2007. TRIS Rating said, ICC’s financial policies remain very conservative. The company has been debt-free since 2002. ICC had gradually reduced the amount of the guarantees extended to related companies from a peak of Bt2,046 million at the end of 1997 to Bt331 million at the end of March 2008. As a result of the slowdown in private consumption together with the strategic decision to quit distributing prepaid phone cards, ICC’s sales declined by 12.9% in 2007. The decline was mainly due to sluggish sales of lingerie (sales declined by 12.9%), men’s apparel (down by 7.3%) and prepaid phone cards (down by 55%). Prepaid phone cards is a non-core business that had previously made large contributions to total sales (around 8%-9% of revenue during 2005-2006 and 5% in 2007). ICC’s total sales during the first quarter of 2008 declined by 4.3% to Bt2,775 million from Bt2,899 million in 2007. This drop was due in part to the termination of the phone card distribution business at the end of 2007 and partly due to flat sales in core businesses. However, the company’s financial profile remains very strong. Funds from operations (FFO) were Bt885 million in 2006 and Bt863 million in 2007, more stable than the sales performance during the same periods. TRIS Rating also said that some investors may have difficulty analyzing the individual company due to the cross-holding structures between ICC and other Saha Group’s companies. However, all transactions among ICC and companies in the Saha Group conform to the regulations of the Stock Exchange of Thailand (SET) and Securities and Exchange Commission (SEC).