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ANNUAL REPORT | 1
CONTENTS
Message from CEO
Message from Board of Directors
Introduction of Management Board
03
05
06
ABOUT US Financial highlights
Advantages of agricultural sector
Potential of consumer good sector
Milestones
Our guiding objective
Our fund raising and M&A timeline
Shareholder structure
09
10
11
12
13
14
15
OUR PROJECTS Ladofoods
Vinatea
17
23
OUR WAY FORWARD Next projects
Divestment schedule
Estimated revenue contribution structure
New administrative structure
30
31
31
32
BUSINESS INFORMATION 34
FINANCIAL STATEMENTS Report of the Board of Director
Independent Auditor’s Report
Consolidated Balance Sheet
Consolidated Income Statement
Consolidated Cash Flow Statement
Footnotes to Financial Statement
35
37
39
43
44
47
ANNUAL REPORT | 3
DEAR VALUED INVESTOR,
GTN marked 2015 as a transformative year, offering
and achieving new investment opportunities, joining
with strategic international investors and expanding
our core businesses.
In the past year, with the success of becoming the
largest investor in Vinatea, the leading and long
established tea brand in Vietnam, GTN made a
significant transition toward becoming a leading
corporation in the agriculture and branded food
sectors. Concomitantly, we reduced and will continue
to reduce our non-core investments, focusing instead
on acquiring, working with and improving SOEs that
offer large scale operations in agriculture and
branded foods.
GTN has built an excellent management team,
leveraging the financial power of strategic
shareholders.
To reach even greater success in 2016, GTN will work
tirelessly to achieve our bold strategy and unleash the
potential of our subsidiaries. We seek to build an
increasingly profitable, larger, more professional and
transparent GTN, achieving best in class professional
standards of operation.
In 2016, our projects continue to proceed with
optimism.
Given our current opportunities, combined with our
management and staff expertise, together with your
support, GTN will continue to grow and strengthen its
name in the agriculture and branded beverage and
food sectors.
Best regards,
Ta Van Quyen
Chief Executive Officer
ANNUAL REPORT | 5
DEAR VALUED INVESTORS,
Offered the opportunity to join the Board of Directors
of GTN in the early part of 2016, I was honored to
accept, and to become Vice Chairman. Having worked
these past years in agriculture and food in Vietnam,
steering investments from international funds
understanding the opportunities now in Vietnam, and
birthing exciting new lines of business, I was and
remain deeply enthusiastic regarding GTN’s strategy
and commitment to privatizing well known
Vietnamese agriculture and food companies owning
leading national brands.
GTN understands the important of supporting
excellent managers, of rationalizing operations and
driving value through creative brand growth. Few
things are more crucial to the improvement of
Vietnam’s agriculture sector than brand development,
both for domestic consumption and export.
Vietnam is a world leading producer and exporter of
so many agriculture products, but too often remains a
low cost producer and seller of unbranded,
commoditized products such as rice, coffee, tea,
catfish, cashew, pepper, on and on. With 65% of our
population being rural, and 48% of our workforce
being farmers, yet with only 17% of GDP derived from
agriculture, the opportunity and the need are clear.
Rural development, the improvement of living
standards, as well as the opportunity for improved
food safety and food security, all these can most
readily be realized through committed, excellently
managed companies driving world class brand
development; where consumers here and abroad
trust quality and safety.
GTN has achieved exactly this outcome with Chateau
Dalat and Vang Dalat, we are pursuing the same with
VinaTea, and I am excited by the future. With the
vision and ability of GTN, these next five years are set
to be rewarding for all involved.
Sincerely,
Dr. Michael Louis Rosen
Vice Chairman
MR. NGUYEN TRI THIEN CHAIRMAN OF THE BOARD
Mr. Nguyen Tri Thien brings an enthusiastic strength of
experience in business development and financial management
to his work with GTN. He lived and worked in the US for over 20
years, holding senior positions in Toyota Southern California
Region, Vincent Construction Company and CSULB CNC
Workshops.
Mr. Thien, along with other members of the Board of Directors,
determined to lead the Company to become a sustainable
business.
MR. MICHAEL LOUIS ROSEN VICE CHAIRMAN
Dr. Michael Louis Rosen is experienced in fundraising, new
business initiatives and executive management. As PAN Group’s
CEO and Vice Chairman, he led successive fundraisings achieving
approximately 80 USD million in equity, and spearheaded new
business development. He was previously the principal owner of
a member firm of the New York Stock Exchange (NYSE). Dr. Rosen
was also a professor in NYU’s Management Department, and the
former Chief Strategic Officer of Saigon Securities Inc. (SSI).
Joining GTN in early 2016, bringing his years of experience in
Vietnam, Dr. Rosen’s desire is to build GTN to a leading regional
agriculture and branded beverage and food company.
Dr. Michael Lous Rosen earned a Ph.D., MBA and MA from The
Wharton School of the University of Pennsylvania.
MR. TA VAN QUYEN CHIEF EXECUTIVE OFFICER
In 2012, Mr. Ta Van Quyen joined the BOD of GTN and became its
CEO in 2014. He has extensive experience in the food production
industry, exercising key managerial roles in Hai Ha Confectionery
Company, Tien Bao Food Processing Co, Ltd and Chairman sum
CEO of Q&Q Foodstuffs Vietnam JSC.
Mr. Quyen dedicates his career to lead GTN to be a leading
company operating in agriculture and branded beverage and food
in Vietnam and the region.
Mr. Ta Van Quyen graduated from the Hanoi University of
Technology, majoring in Food Technology Engineering.
THONG NHAT CORP | 6
MR. LA MANH TIEN
DEPUTY CEO
Mr. La Manh Tien has assumed the role of CEO at VinaTea, leading the corporate restructuring to achieve efficient operations and quickly pave the opportunity for branded produced development. Mr. Tien graduated from Montesquieu University, France with a master degree in finance. He previously occupied senior positions in Vinaconex JSC, Vincom Construction Co. and Vinabamboo JSC.
MR. NGUYEN TRAN QUANG DEPUTY DIRECTOR
Mr. Nguyen Tran Quang is an expert in consumer branding and marketing. He has held key marketing roles introducing and expanding such international brands as Hennessy and Johnny Walker in Vietnam. He was previously Sales Director of Triumph and Training Directors of Kodak. He also participated in developing brands and products for Da Lat Wine, Thai Tuan Textiles, Trung Nguyen Coffee, Saigon Beer Special, Number 1 energy drink and other leading domestic brands. Mr. Nguyen Tran Quang graduated with double majors in Marketing and Commerce from the University of Texas Austin.
MR. HOANG MANH CUONG
CHIEF ACCOUNTANT
Before joining GTN as Chief Accountant, Mr. Hoang Manh Cuong held senior positions including as Accountant of Ha Tay Food Complex Corporation, Chief Accountant of Bach Hop Food Import and Export Corporation, and Manager of Trung Kien Manufacturing and Investment Corporation. He graduated with a master’s degree in economics from University of Commerce, and has a deep understanding regarding finance and accounting.
ANNUAL REPORT | 7
THONG NHAT CORP | 8
ABOUT US
Unit: VND bn 2015 2014
Total assets 2,104 1,081
Net Revenue 2,105 635
Gross profit 59 53
Earnings after tax 54 89
FINANCIAL HIGHLIGHTS
ANNUAL REPORT | 9
Total assets
Net revenue
Gross profit margin
Total assets and net revenue in 2015 showed
growth of 95% and 231% respectively. The
increase in total assets resulted primarily from
our acquisition of 95% of Vinatea, raising the
number of our subsidiary companies to eight.
Total assets grew to VND2,104 bn, a 95%
increase from to 2014.
Net revenue grew by 231%, primarily contributed
by our strong expansion in business operations.
GTN’s gross profit margin grew by 11%, coming
with a rapid increase in financial expenses
(Approximate 4 times higher than 2014) due to
the company’s need to fund capital expenditure
and M&A activities. A decline in revenue from
financial activities was also recorded
(Approximate 2 times lower than 2014) leading
to a decline in net profit from operating
activities, and a decrease in earnings before tax
compared to 2014.
ADVANTAGES OF AGRICULTURAL SECTOR
In 2015:
• Agriculture accounts for 16% of
Vietnam’s GDP and 14% of the
country’s total export volume, an
export value of over USD22 bn.
Development factors:
• Vietnam government prioritizes
agriculture development, mandating an
overall sector restructuring to achieve
higher efficiency, including larger scale
farming as well as a focus on higher
quality and value-added products,
supported by subsidiary programs in
the period of 2016 – 2020.
• The agriculture sector offers significant
world scale comparative advantages
given weather, soil quality, water and
labor force dynamics.
• Benefits from participating in TPP are
expected to drive significant growth in
agriculture exports.
THONG NHAT CORP | 10 ANNUAL REPORT | 11
POTENTIAL OF CONSUMER GOODS SECTORS
FOOD CONSUMPTION
Growth drivers: National consumption trends are shifting towards higher
quality products, relating also to food safety, as well as an increased
awareness of quality, branding and design.
Market sectors Market value
(USD m) CAGR
2014-2020
Confectioneries 1,344 9,3%
Processed food 8,600 7%
Milk 3,555 6.0%
Tea (including bottled tea) 934 10,9%
CAGR 2014-2018
5%
Total Food Consumption
$43.6B
Growth (2015)
7%
MILESTONES
THONG NHAT CORP | 12
2011 › Established GTN
2013 › 03/2013: USD31 m charter capital. › 12/2013: Raised ownership in VDL to
24,86%
2014 › 03/10/2014: Listed on HOSE.
Ticker: GTN
2015 › 03/2015: Raised ownership in VDL to
35%. › 06/2015: Stock dividend 10:1 › 08/2015: Acquired 95% Vinatea
Early 2016 › 01/2016: Raised charter capital
to USD68 m through private placement to strategic investors.
ANNUAL REPORT | 13
OUR GUIDING OBJECTIVE
Vision: Vietnam’s leading food and agriculture company built through studied, intrepid and fitting
acquisition focused on strong brands within privatizing companies. Skillful consolidation from excellent
governance and managerial control.
Mission: Realizing value by majority acquisition of large scale privatizing agriculture and food companies.
Improving strong brands, strengthening corporate governance and management, divesting non-core
businesses.
Our guiding objective is to build an operating corporation with subsidiaries in the beverage, food and
agriculture sectors.
Our companies will offer the range of agriculture products, packaged foods and beverages present in the
typical shopping basket of Vietnamese consumers.
GTN
Beverage Food Agriculture
OUR FUNDRAISING AND M&A TIMELINE
THONG NHAT CORP | 14
10/2014 › Listed on HOSE.
Charter capital: USD31m.
03/2015 › Raised ownership in
VDL to 35%.
06/2015 › Stock dividend 10:1 › Charter capital: USD34m
08/2015 › Acquired 95% Vinatea › USD21.3m in value
01/2016 › Raised USD36.6m in equity › Charter capital: USD68m
09/2015
› Non-core assets
divestment:
Granite Co.
03/2015
› Non-core assets
divestment:
TItan Co.
ANNUAL REPORT | 15
SHAREHOLDER STRUCTURE
20.00%
26.67%
15.73%
7.52%
30.08% TAEL
Các cổ đông chiến lược trong nước
Các cổ đông chiến lược nước ngoài
Các định chế tài chính
Cổ đông khác
Foreign strategic investors
Financial Institutions
Other shareholders
Domestic strategic investors
THONG NHAT CORP | 16
OUR PROJECTS
ANNUAL REPORT | 17
KEY PERFORMANCE INDICATORS
THONG NHAT CORP | 18
In 2015, Ladofoods continued the positive
growth in its core business operations.
Total revenue increased by 20% to VND428.5
bn in 2015.
Net income for 2015 increased by 23% to
VND24.9 bn. Most of the growth come from
its wine business.
An effective restructuring has significantly
improved operating results. In 2015, revenue
per employee reached VND1 bn, a 250%
growth compared to 2012.
325
389
458
2013 2014 2015
Total Revenue
(VND bn)
23 20
25
2013 2014 2015
Earning after tax
(VND bn)
338 287 389
456 0.4
0.44
0.79
1
0
1
1
2
0
500
1,000
1,500
2,000
2012 2013 2014 2015
Revenue
Revenue per employee
(VND bn)
ANNUAL REPORT | 19
KEY PERFORMANCE INDICATORS
The firm launched new product lines with higher
price points and improved profit margins.
Given the commodity nature of the cashew
business, accounting for a large proportion of
revenue, the company’s aggregate profit margin
did not significantly reflect the improvement in its
wine business.
Vang Da Lat continued to maintain its leading
position in the domestic wine market. The
transformation in package design with the launch
of new product lines and promotional programs
has increased product awareness, brand
recognition and loyalty, as well as the recognition
of increased product quality.
The firm’s market capitalization continued to grow,
recorded at approximate VND500 bn in 2015, a
growth of over 5 times compared to 2012,
reflected in the positive perspective of investors
regarding the transformation of the firm and its
potential.
Gross profit margin of Chateau Dalat
Position in domestic wine market
Market cap. Growth during 2012 - 2015
REFRESH THE BRAND
2015’s Vang Da Lat brand and image repositioning was the most significant step undertaken by Ladofoods.
The designs of its traditional products were refreshed to be consistent, more modern and internationally oriented, encouraging consumers to feel more confident when choosing Vang Da Lat.
Vang Da Lat also launched significant media campaigns and promotions in order to create strong awareness of the new brand and design, with the goal of gradually replacing the earlier brand impressions.
THONG NHAT CORP | 20
Repostioning The Brand
01 Redesigning New Image
02 Product
Improvement
03 Create strong
Awareness
04 Product
Trial
05
ANNUAL REPORT | 21
THE LAUNCH OF CHATEAU DALAT
The company launched a new product range, Chateau Dalat. Created to achieve a higher product value, the consumer is exposed to a fresh perception regarding Vietnamese wine.
The packaging of Chateau Dalat achieves a high standard, suited to the needs of gift giving especially during the Tet Holidays.
Design new global standard packaging Design new label and packaging with premium look for affordable price.
Increase Brand awareness Communicate focus on key media channel & through activation programs.
Create product trial Bring the new wine
directly to the drinker at their premises.
Blind Taste Challenge Challenge the current wine perception to compare on
par with the new world wine.
Chateu Dalat wine
The pleasant surprise from Ladora winery
FOCUS ON EXPANDING DISTRIBUTION NETWORK
Distribution Network
General Trade Supermarkets Key Accounts Hotels
Restaurants
Ladofoods continued to expand its distribution network in 2015.
The number of points of sale is now estimated to be more than 90,000 throughout the country, under the management of over 140 distributors and agents, along with the entire large and small chains of supermarkets.
Thanks to the transformation of brand identity and package designs and the launch of higher-end Chateau Dalat, the firm’s points of sales in hotels and restaurants expanded significantly, including the participation of five-stars hotels such as the Rex and Reverie.
Sales staff continued to be more professional through training and examinations.
THONG NHAT CORP | 22 ANNUAL REPORT | 23
VINATEA – RE-ESTABLISH THE POSITION
A leading tea company
Advantages:
• Former Tea Farm and Tea Factory Union, the
largest tea producer in Vietnam.
• Strong support from Government.
• Own approx. 4,700 ha of tea fields:
2,000 ha in Moc Chau (best quality), Thai
Nguyen, Yen Bai.
2,000 ha in Phu Da (Phu Tho);
718 ha in Lien Son, Nghia Lo.
• 140,000 m2 of office buildings and workshops,
including 34,000 m2 of factory land in Soc Son,
near Noi Bai International Airport.
• Inherit infrastructure and logistic facilities.
• Long-standing recognized brand.
• Solid customer base.
THONG NHAT CORP | 24 ANNUAL REPORT | 25
RESTRUCTURING VINATEA WITH TOP-FIELD EXPERTS
Plantation
Fact Sheet
Phu Da Thai Nguyen Moc Chau Yen Bai Nghia Lo,
Lien Son
Area (ha) 2,000 377 1,138 452 718
Tea type Black tea
Green tea
Black tea Green tea
Oolong
Green tea
Black tea Green tea
Black tea Green tea
Tree type LDP 1
PH1
Trung Du Shan
Kim Xuyen
Trung Du Trung Du
Average age (years) 30 45 57 44 40
Yields (tons/ha) 15 9 25 9 10
Volume per year
(tons)
5,250 1,000 3,750 1,000 1,800
HUMAN RESOURCE
PRODUCTS
QUALITY
• Appoint new CEO. • Appoint new sales director. • Refresh sales team. • Appoint new restructuring team. • Improve the performance of staff.
• Develop new product lines.
• Reposition the brand.
• Launch new product lines in July 2016.
• Introduce new brand identity in May 2016.
• Darjeeling tea consultant projects.
• Initiating Japanese strategic alliance.
MAXIMIZE VALUE THROUGH IMPROVING QUALITY
THONG NHAT CORP | 26
Raw material area Primary products Kim Anh Factory Distribution
Network Customers
Raw material area Primary products Merchants Tea companies Customers
LOW PROFIT MARGIN
REALIZE PROFIT MARGIN
OLD PRODUCT DISTRIBUITION CHAIN OF VINATEA
NEW PRODUCT DISTRIBUTION CHAIN OF VINATEA
0
10
20
30
40
50
Green tea Black teaOrthodox
Oolong tea Premium greentea
Super premiumgreen tea
Margin Distribution Package Brand
Quality Production Raw material
ANNUAL REPORT | 27
STRATEGIES FOR VINATEA IN THE NEXT 5 YEARS
SHORT-TERM
(1 YEAR)
Redesign the Master Brand.
Design new packaging for the core product group to enter the major domestic market.
Distribution to cover all
Modern Trade and expand to General Trade, Business to Business and Tourism.
MEDIUM-TERM
(3 YEARS)
Launch new innovative products.
Launch new product for
international tourist. Launch Ecommerce
website for domestic market.
LONG-TERM
(5 YEARS)
Launch and distribute international tea brand to key global market.
Launch ecommerce
Website for international market.
Introduce the tea house
to serve tea beverage.
IDENTIFY KEY MARKETING TASKS
There are several key tasks that need to be solved in order to build a strong brand.
Create strong awareness od both brand and products
Expand the international customer base
Focus on developing distribution network
Redesign packages
Export refined products
Enhance product quality
TARGETS OF VINATEA IN THE NEXT 5 YEARS
THONG NHAT CORP | 28
Middle East
Re-establish
the market
01 Russia
Export processed
black tea
02 Europe
Export
Processed tea
03 US
Export
Raw material
04 US
Entering Retail
Markets with brands
05
OUR WAY FORWARD
ANNUAL REPORT | 29
NEXT PROJECTS
THONG NHAT CORP | 30
In 2016, GTN will continue to pursue its strategy of acquiring majority ownership positions in and extended operating expertise to agriculture, branded beverage and food companies.
STRATEGIC GOAL OF BUILDING A COMPLETE AND SUSTAINABLE BUSINESS
STRUCTURE
35%
Beverage Agriculture Food
Core
DAIRY
Dairy Farm Packaged Food
Increase ownership Agricultural projects Packaged food company
ANNUAL REPORT | 31
DIVESTMENT SCHEDULE
ESTIMATED REVENUE CONTRIBUTION STRUCTURE
Non-Core Companies
DIVESTED 03/2015
DIVESTED 09/2015
DIVEST Mid 2016
DIVEST Mid 2016
DIVEST Q2/2016
Titan Co.
Granite Co.
Thong Nhat Energy
Thong Nhat Materials
Agri Supply Trading Co.
Thong Nhat Trading
Core: 90% Non-core: 10%
Core: 93% Non-core: 7%
Core: >95% Non-core: <5%
DIVEST Q2/2016
NEW ADMINISTRATIVE STRUCTURE
Centralization: • GTN will continue to centralize management
operations at the parent level. • Pursuing a matrix structure, corresponding
departments in subsidiaries will be under same-department management within the parent company.
• GTN plans a centralized office for parent and subsidiary operations.
Targets: • Ensure the implementation of company strategy. • Monitor administration and decision-making regarding
effectiveness and timeliness. • Facilitate strategic decision-making.
THONG NHAT CORP | 32 ANNUAL REPORT | 33
CONSOLIDATED FINANCIAL STATEMENTS 2015
THONG NHAT CORP | 34
ANNUAL REPORT | 36
REPORT OF THE BOARD OF DIRECTORS
The Board of Directors of Thong Nhat Production and Investment Joint Stock Company ("the Company") presents this report together with the Company’s audited financial statements for the year 31/12/2015. THE BOARDS OF MANAGEMENT AND DIRECTORS The members of the Boards of Management and Directors of the Company who held office at the date of this report are as follows:
Board of Management
Mr. Nguyen Tri Thien Chairman
Mr. Michael Louis Rosen Vice Chairman
Mr. Ta Van Quyen Member
Mr. Hoang Manh Cuong Member
Mr. La Manh Tien Member
Board of Directors
Mr. Ta Van Quyen Chief Executive Officer
Mr. Nguyen Tran Quang Deputy General Director
Mr. La Manh Tien Deputy General Director
BOARD OF DIRECTORS’ STATEMENT OF RESPONSIBILITY
The Board of Directors of the Company is responsible for preparing the financial
statements of each year, which give a true and fair view of the financial position of the
Company and of its results and cash flows for the year. In preparing these financial
statements, the Board of Directors is required to:
• Select suitable accounting policies and then apply them consistently;
• Make judgments and estimates that are reasonable and prudent;
• State whether applicable accounting principles have been followed, subject to any
material departures disclosed and explained in the financial statements;
• Prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the Company will continue in business; and
• Design and implement an effective internal control system for the purpose of
properly preparing the financial statements so as to minimize errors and frauds.
The Board of Directors is responsible for ensuring that proper accounting records are
kept, which disclose, with reasonable accuracy at any time, the financial position of the
Company and to ensure that the financial statements comply with Vietnamese
Accounting Standards, Vietnamese Enterprise Accounting System and prevailing
accounting regulations in Vietnam. It is also responsible for safeguarding the assets of
the Company and hence for taking reasonable steps for the prevention and detection of
fraud and other irregularities.
For and on behalf of the Board of Directors,
Ta Van Quyen
Chief Executive Officer
March, 28th 2016
THONG NHAT CORP | 35
ANNUAL REPORT | 38
INDEPENDENT AUDITORS’ REPORT
To: The shareholders and the Board of Management of
Thong Nhat Production and Investment Joint Stock Company
We have audited the accompanying financial statements of Thong Nhat Production and
Investment Joint Stock Company ("the Company") as set out on pages 03 to 32, which
prepared on 28/3/2015. These financial statements comprise the Balance sheet as at
31/12/2015, and Income statement, Cash flow statement, Notes to the financial
statements for the year then ended.
Board of Directors' Responsibility
The Board of Directors is responsible for the preparation and fair presentation of these
financial statements in accordance with Vietnamese Accounting Standards,
Vietnamese Enterprise Accounting System and the statutory requirements relevant to
preparation and presentation of financial statements, and for such internal control as
directors determine is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our
audit. We conducted our audit in accordance with Vietnamese Standards on Auditing.
Those standards require that we comply with ethical requirements and plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts
and disclosures in the financial statements. The procedures selected depend on the
auditor’s judgment, including the assessment of the risks of material misstatement of
the financial statements, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the
entity’s preparation and fair presentation of the financial statements in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by directors, as well as evaluating the
overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
Auditors’ Opinion
In our opinion, the accompanying financial statements give a true and fair view of, in all
material respects, the financial position of the Company as at 31/12/2015 and the results
of its operations and its cash flows for the year then ended in accordance with
Vietnamese Accounting Standards, Vietnamese Accounting System and the statutory
requirements relevant to preparation and presentation of financial statements.. Hanoi, 2016
Vietland auditing and consulting
Company Limited Ha Noi Branch
HOANG DINH HAI - Vice Director
CPA Certificate No.: 2282-2015-037-1
NGUYEN NGOC TU - Auditor
CPA Certificate No.: 2305-2014-037-1
THONG NHAT CORP | 37
ANNUAL REPORT | 40
CONSOLIDATED BALANCE SHEET
As at 31 December 2015
FORM B 01-DN/HN
Unit: VND
CODE ASSETS NOTES 31/12/2015 01/01/2015
100 A. CURRENT ASSETS 1.339.388.682.418 644.519.908.096
110 I. Cash and cash equivalents V.1 416.449.029.291 11.452.072.713
111 1. Cash 416.449.029.291 11.452.072.713
120 II. Short-term financial investments 67.110.227.391 8.882.031.000
121 1. Trading Securities V.7a 64.601.221.391 9.748.601.005
122 2. Provision for declines in trading
securities V.7a - (866.570.005)
123 3. Held-to-maturity investments 2.509.006.000 -
130 III. Short-term receivables 712.662.027.259 534.266.179.154
131 1. Trade receivables V.2a 344.059.027.580 259.035.877.933
132 2. Advances to suppliers 270.101.786.092 95.393.587.723
135 5. Receivables on short-term loans V.3 7.700.000.000 39.192.100.000
136 6. Other receivables V.4a 91.149.011.334 140.644.613.498
137 7. Provision for doubtful debts (347.797.747) -
140 IV. Inventories V.5 124.301.767.143 87.445.069.914
141 1. Inventories 124.301.767.143 87.445.069.914
150 V. Other current assets 18.865.631.334 2.474.555.315
151 1. Prepaid expenses V.6a 477.860.625 119.529.330
152 2. Value-added Tax deductible 18.253.094.653 2.352.340.875
153 3. Tax receivables 11 134.676.056 2.685.110
200 B. NON-CURRENT ASSETS 761.589.240.949 437.125.637.974
210 I. Non-current receivables 36.908.681.864 -
211 1. Non-current trade receivables V.2b 6.908.681.864 -
216 6. Other non-current receivables V.4b 30.000.000.000 -
220 II. Fixed assets 326.647.673.075 226.065.697.261
221 1. Tangible assets V.8 326.526.996.692 225.987.363.932
222 - Book value 531.178.040.341 258.249.474.197
223 - Accumulated depreciation (204.651.043.649) (32.262.110.265)
227 3. Intangible assets V.9 120.676.383 78.333.329
228 - Book value 860.769.126 100.000.000
229 - Accumulated depreciation (740.092.743) (21.666.671)
240 IV. Non-current assets in progress 1.958.105.876 1.361.401.174
242 2. Construction in progress 1.958.105.876 1.361.401.174
250 V. Non-current financial investments 383.811.749.592 203.912.890.759
252 2. Investments in affiliates V.7b 255.579.885.592 116.912.890.759
253 3. Investments in other companies V.7b 128.231.864.000 87.000.000.000
260 VI. Other non-current assets 12.263.030.542 5.785.648.780
261 1. Non-current prepaid expenses V.6b 6.647.991.333 5.785.648.780
269 2. Goodwill 5.615.039.209 -
270 TOTAL ASSETS 2.100.977.923.367 1.081.645.546.070
THONG NHAT CORP | 39
ANNUAL REPORT | 42
CONSOLIDATED BALANCE SHEET (Continued)
As at 31 December 2015
FORM B 01-DN/HN
Unit: VND
CODE LIABILITIES NOTES 31/12/2015 01/01/2015
300 C. LIABILITIES 1.103.558.860.476 215.722.087.610
310 I. Current liabilities 867.830.549.115 215.722.087.610
311 1. Trade payables V.10 80.404.696.898 154.438.469.747
312 2. Unearned revenue 25.483.504.696 7.192.153.352
313 3. Tax payables V.11 19.572.156.332 18.050.983.779
314 4. Wage payables 6.366.227.124 829.397.146
315 5. Accrued expenses V.13 12.906.992.842 66.536.635
319 9. Other short-term payables V.14a 331.972.869.741 4.462.658.762
320 10. Short-term loans and
borrowings V.12a 390.747.465.133 30.681.888.189
322 12. Bonus and welfare fund 376.636.349 -
330 II. NON-CURRENT
LIABILITIES 235.728.311.361 -
336 6. Non-current unearned
revenue 16.197.670.706 -
337 7. Other long-term payables V.14b 5.745.024.396 -
338 8. Long-term loans and
borrowings V.12b 213.603.305.259 -
342 12. Provision for long-term
payables 8.920.000 -
343 13. Development fund for
science and technology 173.391.000 -
400 D. OWNER'S EQUITY 997.419.062.891 865.923.458.460
410 I. Owner's equity 997.419.062.891 865.923.458.460
411 1. Contributed capital V.15 748.000.000.000 680.000.000.000
411a - Common shares 748.000.000.000 680.000.000.000
418 8. Development fund V.15 683.081.038 -
420 10. Other component funds V.15 221.299.709 -
421 11. Retained earnings V.15 101.951.485.611 115.156.907.337
421a - Accumulated retained earnings
as at year beginning 47.051.431.269 28.700.786.891
421b - Accumulated retained earnings
this year 54.900.054.342 86.456.120.446
429 13. Attributable to minority interests 146.563.196.533 70.766.551.123
430 II. Other resources and funds - -
440 TOTAL LIABILITIES 2.100.977.923.367 1.081.645.546.070
THONG NHAT CORP | 41
Ta Van Quyen
Chief Executive Officer
March, 2016
Hoang Manh Cuong
Chief Accountant
Nguyen Thi Thu Huyen
Preparer
ANNUAL REPORT | 44
CONSOLIDATED INCOME STATEMENT
For the year ended 31 December 2015
FORM B 02-DN/HN
Unit: VND
CODE ITEMS CODES 31/12/2015 31/12/2014
01 1. Gross sales of merchandise and services VI.1 2.109.286.422.692 635.571.120.845
02 2. Revenue deductions VI.1 362.794.250 99.110.100 10 3. Net sales of merchandise and
services VI.1 2.108.923.628.442 635.472.010.745 11 4. Cost of goods sold VI.2 2.045.921.740.476 581.918.763.967 20 5. Gross profit from sales of
merchandise and services 63.001.887.966 53.553.246.778 21 6. Finance income VI.3 34.982.458.850 78.303.412.732 22 7. Finance expenses VI.4 15.903.090.611 4.241.934.116 23 Of which: Interest expenses
14.922.773.127 732.772.163 24 8. Profit/Loss from Affiliates 5.551.142.033 468.555.906 25 9. Selling expenses VI.5 8.754.269.942 4.589.601.225 26 10. General and administrative
expenses VI.6 15.013.509.462 9.895.220.840 30 11. Operating profit/loss 63.864.618.834 113.598.459.235 31 12. Other income 14.576.547.253 1.201.898.892 32 13. Other expenses 10.349.108.386 1.014.755.695 40 14. Other profit/loss VI.7 4.227.438.867 187.143.197
50 15. Earning before taxes 68.092.057.701 113.785.602.432 51 16. Current tax expense VI.8 10.734.040.569 23.789.632.386 52 17. Deferred tax expense/income
- - 60 18. Earning after taxes 57.358.017.132 89.995.970.046 61 - Attributable to the Group 54.900.054.342 86.456.120.446 62 - Attributable to minority
interests 2.457.962.790 3.539.849.600 70 19. Earning per share VI.9 734 1.156
CONSOLIDATED CASHFLOW STATEMENT
(Indirect method)
For the year ended 31 December 2015
FORM B 03-DN/HN
Unit: VND
CODE ITEMS 31/12/2015 31/12/2014
I. CASH FLOWS FROM OPERATING
ACTIVITIES
01 1. Profit before tax 68.092.057.701 113.785.602.432
2. Adjustments for:
02 - Depreciation and amortization 21.781.587.151 20.062.654.826
03 - Provisions (518.772.258) 303.934.060
04 - Change in foreign currency
translation (1.161.469) 2.790.380
05 - Gain/loss from investing activities (44.578.882.117) (62.594.895.804)
06 - Interest expenses 14.922.773.127 732.772.163
08 3. Operating profit before
movements in working capital 59.697.602.135 72.292.858.057
09 - Increase, decrease in receivables (251.061.634.094) (288.015.884.840)
10 - Increase, decrease in inventories (9.326.742.044) (33.003.581.672)
11 - Increase, decrease in payables (43.878.909.928) 99.738.899.518
12 - Increase, decrease in prepaid
expenses 2.531.714.420 (1.738.958.293)
13 - Increase, decrease in trading
securities (54.852.620.386) 30.741.401.568
14 - Interest paid (10.325.923.200) (666.235.528)
15 - Income tax paid (17.079.790.569) (15.467.784.607)
16 - Other cash inflows from operating
activities - 364.601.306
17 - Other cash outflows from operating
activities - (600.651.090)
20 Net cash flows from operating
activities (324.296.303.666) (136.355.335.581)
THONG NHAT CORP | 43
Ta Van Quyen
Chief Executive Officer
March, 2016
Hoang Manh Cuong
Chief Accountant
Nguyen Thi Thu Huyen
Preparer
ANNUAL REPORT | 46
II. CASH FLOWS FROM INVESTING
ACTIVITIES
21 1. Acquisition of fixed assets and other long-
term assets (35.370.542.600) (17.492.877.598)
22 2. Proceeds from liquidation of fixed
assets and other long-term assets 11.030.909.091 2.411.818.181
23 3. Cash outflows for lending and buying debt
instruments of other companies (25.700.000.000) (39.849.826.000)
24 4. Cash recovered from lending and selling
debt instruments of other companies 57.192.100.000 78.357.726.000
25 5. Investments in other entities (81.633.612.949) -
26 6. Cash recovered from investments in other
entities 260.701.833.184 55.900.000.000
27 7. Interest and dividends received 2.576.655.601 5.157.376.677
30 Net cash flows from investing activities 188.797.342.327 84.484.217.260
III. CASH FLOWS FROM FINANCING
ACTIVITIES
31 1. Proceeds from issuing stocks, receiving
capital from owners - 7.703.173.196
33 3. Proceeds from borrowings 924.170.564.981 128.653.443.801
34 4. Repayments of borrowings (383.673.485.595) (99.613.773.899)
40 Net cash flows from financing activities 540.497.079.386 36.742.843.098
50 Net cash flow 404.998.118.047 (15.128.275.223)
60 Cash and cash equivalents at the beginning
of the year 11.452.072.713 26.588.258.309
61 Change in foreign currency translation (1.161.469) (7.910.373)
70 Cash and cash equivalents at the ending of
the year 416.449.029.291 11.452.072.713
THONG NHAT CORP | 45
Ta Van Quyen
Chief Executive Officer
March, 2016
Hoang Manh Cuong
Chief Accountant
Nguyen Thi Thu Huyen
Preparer
ANNUAL REPORT | 48
I. GENERAL INFORMATION
1. Parent company
Thong Nhat Production and Investment Joint Stock Company, from the precursor
of Dai Viet Minerals and Environment,.Jsc, was approved to establish and operate
in accordance with the 1st Business Registration Certificate No. 0105334948
issued by Ha Noi Department of Planning and Investment on 30/05/2011.
During the operation, the company has been renamed from Dai Viet Minerals and
Environment,.Jsc to Thong Nhat Production and Investment Joint Stock Company,
the changes of the business line and charter capital of the company have been
certified respectively in changed business registrations by Ha Noi Department of
Planning and Investment .
The Company has received the 10th adjusted Business Registration Certificate No.
0105334948 dated 20/07/2015 granted by Ha Noi Department of Planning and
Investment, raising its charter capital to 748.000.000.000 billion VND.
Main operations of the company:
Principal activities of the Company are: Railways, civil, and public Contrucstion
works; Wholesale trade of agricultural and forestry raw materials; Wholesale trade
of fertilizer and agricultural products, Manufacturing plastic pipe andother plastic
products; Producing clay building materials; Manufacturing refractory products,
Burning charcoal (wood, legally sourced wood), etc.
The head office of the Company: 2nd Floor, CEO Tower, Lot HH2 -1 Me Tri Ha
urban area, Pham Hung Street, Nam Tu Liem District, Hanoi.
2. Consolidated subsidiaries
Mien Trung Plastic Joint Stock Company
* Address: No.52, Pham Van Dong, Nui Thanh Town, Nui Thanh District, Quang
Nam Province
* Ownership interest of parent company as at 31/12/2015: 90%
* Voting rights of parent company as at 31/12/2015: 90%
FOOTNOTES TO FINANCIAL STATEMENTS 2015
THONG NHAT CORP | 47
ANNUAL REPORT | 50
Thong Nhat Mien Trung Material Contruction Joint Stock Company
* Address: Village 1, Tam Loc Commune , Phu Ninh District, Quang Nam Province
* Ownership interest of parent company as at 31/12/2015: 52,46%
* Voting rights of parent company as at 31/12/2015: 52,46%
Thong Nhat Bioenergy Joint Stock Company
* Address : Ang Son Village, Van Ninh Commune, Quang Ninh District, Quang Binh
Province
* Ownership interest of parent company as at 31/12/2015: 95%
* Voting rights of parent company as at 31/12/2015: 95%
Moc Chau Industrial Bamboo Joink Stock Company
* Address: Bo Bun Industrial Park, Moc Chau Farm Town, Son La Province
* Ownership interest of parent company as at 31/12/2015: 90.5%
* Voting rights of parent company as at 31/12/2015: 89%
Thong Nhat Agricultural Product One Member Co.,Ltd
* Address: Bo Bun Industrial Park, Moc Chau Farm Town, Son La Province
* Ownership interest of parent company as at 31/12/2015: 100%
* Voting rights of parent company as at 31/12/2015: 100%
Thong Nhat Tay Nguyen Agricultural Material Joint Stock Company
* Address: Thuan An Industrial Park, Thuan An Commune, Dak Mil Distric, Dak
Nong Province
* Ownership interest of parent company as at 31/12/2015: 65%
* Voting rights of parent company as at 31/12/2015: 65%
2. Consolidated subsidiaries (continued)
Tổng Công ty Chè Việt Nam - CTCP
* Địa chỉ: 92 Vo Thi Sau Street, Hai Ba Trung District, Hanoi
* Tỷ lệ lợi ích của công ty mẹ tại ngày 31/12/2015: 74,99%
* Quyền biểu quyết của công ty mẹ tại ngày 31/12/2015: 74,99%
Thong Nhat Trading Co., Ltd
* Address: 2nd Floor, CEO Tower, Lot HH2 -1 Me Tri, Nam Tu Liem District, Hanoi.
* Ownership interest of parent company as at 31/12/2015: 100%
* Voting rights of parent company as at 31/12/2015: 100%
3. Consolidated associates
Lam Dong Food Joint Stock Company
* Address: Da Lat City, Lam Dong Province
* Ownership interest of parent company as at 31/12/2015: 35%
* Voting rights of parent company as at 31/12/2015: 35%
4. Other long-term investments
Thong Nhat Co.,Ltd
* Address: Dong Ha City, Quang Tri Province
* Ownership interest of parent company as at 31/12/2015: 15.5%
* Voting rights of parent company as at 31/12/2015: 15.5%
Phu Yen Granite Joint Stock Company
* Address: Song Cau Town - Phu Yen Province
* Ownership interest of parent company as at 31/12/2015: 17%
* Voting rights of parent company as at 31/12/2015: 17%
THONG NHAT CORP | 49
ANNUAL REPORT | 52
II. ACCOUNTING CONVENTION AND ACCOUNTING PERIOD
1. Accounting convention
The accompanying financial statements, expressed in Vietnam Dong (VND), are
prepared under the historical cost convention and in accordance with
Vietnamese Accounting Standards, Vietnamese Accounting System and
prevailing accounting regulations in Vietnam.
2. Accounting period
The Company’s fiscal year begins on 1 January and ends on 31 December.
3. Basis of consolidation
The consolidated financial statements incorporate the financial statements of the
Company and enterprises controlled by the Company (its subsidiaries) up to 31
December each year. Control is achieved where the Company has the power to
govern the financial and operating policies of an investee enterprise so as to
obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included
in the consolidated income statement from the effective date of acquisition or up
to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used in line with those used by the
Company.
Intragroup transactions and balances are eliminated in full on consolidation.
Non-controlling interests in the net assets of consolidated subsidiaries are
identified separately from the parent’s ownership interests in them. Non-
controlling interests consist of the amount of those non-controlling interests at the
date of the original business combination (see below) and the non-controlling
interests’ share of changes in equity since the date of the combination. Losses in
subsidiaries are respectively attributed to the non-controlling interests even if this
results in the non-controlling interests having a deficit balance.
III. DOPTION OF ACCOUNTING STANDARDS AND ACCOUNTING SYSTEM
1. Applicable Accounting System
The Company applies the Vietnamese Accounting System issued by the Ministry of
Finance in accordance with Circular No. 200/2014/TT-BTC dated 22/12/2014, the
Vietnamese Accounting Standards issued by Ministry of Finance and relevant
amendments, supplementing and guiding the implementation.
2. Registered accounting documentation system
The Company’s registered accounting documentation system is the General
Journal system..
3. Adoption of new accounting policy
On 22 December 2014, the Ministry of Finance issued Circular No. 200/2014/TT-
BTC (“Circular 200”) guiding the accounting regime for enterprises. Circular 200
supersedes the regulations for accounting regime promulgated under Decision
No. 15/2006/QD-BTC dated 20 March 2006 issued by the Ministry of Finance
and Circular No. 202/2014/TT-BTC guiding the preparation and presentation of
consolidated financial statements supersede Circular No. 161/2007/TT-BTC
dated 31 December 2007 of the Ministry of Finance guiding the preparation and
presentation of consolidated financial statements. These Circular is effective for
financial years beginning on or after 01 January 2015.
Consolidated financial statements for the year ended 31/12/2015, the Company
prepared in accordance to above circular. Effect of changes in accounting
policies under the guidance of Circular 200/2014/ TT-BTC and Circular 202/2014/
TT-BTC is applied prospectively. The company has additional comparative notes
in the financial statements ended 31/12/2015 for the items to different between
Circular 200/2014/TT-BTC and Decision 15/2006 / QD-BTC in Note VII.6 of
financial statements in 2015.
IV. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1. Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, cash in banks and short-term, highly liquid
investments with an original maturity of less than three months that are readily convertible into
known amounts of cash and that are subject to an insignificant risk of change in value.
2. Receivables and provisions for doubtful debts
Receivables are presented in the financial statements at the carrying amounts due from
customers and other debtors, after provision for doubtful debts.
The provision for doubtful debts represents amounts of outstanding receivables at the balance
sheet date which are doubtful of being recovered on the ending date of accounting period.
Increases and decreases to the provision balance are recorded as general and administrative
expense in the income statement.
THONG NHAT CORP | 51
ANNUAL REPORT | 54
3. Inventories
Inventories are stated at the lower of cost and net realizable value. Cost
comprises direct materials and where applicable, direct labor costs and those
overheads that have been incurred in bringing the inventories to their present
location and condition. Cost is calculated using the weighted average method.
Net realizable value represents the estimated selling price less all estimated
costs to completion and costs to be incurred in marketing, selling and
distribution.
An inventories provision is created for the estimated loss arising due to the
impairment of value (through diminution, damage, obsolescence, etc.) of raw
materials, finished goods, and other inventories owned by the Company, based
on appropriate evidence of impairment available at the balance sheet date.
Increases and decreases to the provision balance are recorded into the cost of
goods sold account in the income statement.
4. Tangible fixed assets
Tangible fixed assets are recognised as original cost deducts accumulated depreciation.
Original cost
The cost of purchased tangible fixed assets comprises its purchase price and
any directly attributable costs of bringing the assets to its working condition and
location for its intended use.
The costs of self-constructed or manufactured assets are the actual
construction or manufacturing cost plus installation and test running costs.
The costs incurred after the initial recognition of tangible fixed assets are
recorded as increase in their cost if these costs are certain to augment future
economic benefits obtained from the use of these assets. Those incurred costs
which fail to meet this requirement are recorded as production and business
expenses during the period.
Depreciation
Tangible fixed assets are depreciated using the straight-line method over their
estimated useful lives as follows:
5. Intangible fixed assets
The actual costs spent by the Company are recognised as intangible fixed
assets if they meet all following criteria without forming tangible fixed assets: (i)
it is probable that future economic benefits associated with the items will flow to
the entity; (ii) they are expected to be used during more than 1 year; (iii) the
cost of the items can be measured reliably and are VND 30,000,000 or more.
Intangible fixed assets are stated at cost less accumulated amortisation.
Original cost
The cost of an intangible fixed asset comprises of its purchase price and any
directly attributable costs of preparing the intangible fixed asset for its intended
use.
The cost of intangible fixed assets formed from the process of enterprise
merger of re-purchase character are the fair value of such assets on the date of
acquisition.
Amortisation
Intangible fixed assets of the Company present is an accounting software. It is
amortized over 5 years by the straight – line method.
6. Financial investments
Investment in subsidiaries
On acquisition, the assets and liabilities and contingent liabilities of a subsidiary
are measured at their fair values at the date of acquisition. Any excess of the
cost of acquisition over the fair values of the identifiable net assets acquired is
recognised as goodwill. Any deficiency of the cost of acquisition below the fair
values of the identifiable net assets acquired is credited to profit and loss in the
period of acquisition.
The non-controlling interests are initially measured at the non-controlling
shareholders’ proportion of the net fair value of the assets, liabilities and
contingent liabilities recognised.
Investment in associates
An associate is an entity over which the Company has significant influence and
that is neither a subsidiary nor an interest in joint venture. Significant influence
is the power to participate in the financial and operating policy decisions of the
investee but not control or joint control over those policies.
Years
Building and architectures 05 -45
Plants and equipment 05- 15
Transportation means 06 -20
Office equipment 03 -08
Other fixed tangible assets 03 -08
THONG NHAT CORP | 53
ANNUAL REPORT | 56
The results and assets and liabilities of associates are incorporated in these
financial statements using the equity method of accounting. Interests in
associates are carried in the balance sheet at cost as adjusted by post-
acquisition changes in the Company’s share of the net assets of the associate.
Losses of an associate in excess of the Company's interest in that associate
(which includes any long-term interests that, in substance, form part of the
Company's net investment in the associate) are not recognized.
Where a group entity transacts with an associate of the Company, unrealized
profits and losses are eliminated to the extent of the Company’s interest in the
relevant associate.
Investments in securities and other investments
Investments in securities and other investments are measured at cost including
directly attributable transaction costs.
Provision for diminution in value of financial investments
Provision for diminution in value of financial investments is made in accordance
with current prevailing accounting regulations which allow provision to be made
for freely traded securities whose book value is higher than market price as at
the balance sheet date. For long-term financial investments, provisions are
made due to loss-making operations of the economic organisation invested by
the Company, except cases of loss anticipated in the business plans compiled
before making investment.
Goodwill
Goodwill represents the excess of the cost of acquisition over the Company’s
interest in the net fair value of the identifiable assets, liabilities and contingent
liabilities of a subsidiary, associate or jointly controlled entity at the date of
acquisition. Goodwill is recognised as an asset and is amortised on the
straight-line basis over its estimated period of benefit of 10 years.
Goodwill arising on the acquisition of associates and jointly controlled entities is
included in the carrying amount of the associates and jointly controlled entities.
Goodwill arising on the acquisition of subsidiaries is presented separately as an
intangible asset in the consolidated balance sheet.
On disposal of a subsidiary, associate or jointly controlled entity, the attributable
amount of unamortised goodwill is included in the determination of the profit or
loss on disposal.
7. Prepaid expenses
Prepaid expenses are reported as short-term or long-term prepaid expenses on
the balance sheet and allocated over the period for which the amount are paid
or the period in which economic benefit are generated in relation to these
expenses.
8. Payables and accruals
Payables and accruals are recognised for amount to be paid in the future for
goods and services received, whether or not billed to the Company.
9. Owners' equity
Owners’ equity are stated at actually contributed capital of owners.
Retained earnings are the profits of business operations after deduction
regulated items due to applying a change in accounting retrospectively or to
make a retrospective restatement to correct materiality in previous year.
10. Revenue
Revenue is recognised to the extent that it is probable that the economic
benefits will flow to the Company and the revenue can be reliably measured.
Revenue is measured at the fair value of the consideration received or
receivable, excluding trade discount, rebate and sales return.
Sales of goods
Sale of goods are recognized if they simultaneously meet the following
conditions: (i) The Company has transferred the majority of risks and benefits
associated with the right to own the products or goods to the buyer; (ii) The
Company no longer holds the right to manage the goods as the goods owner,
or the right to control the goods; (iii) Sale can be reliably measured; (iv) The
Company has gained or will gain economic benefits from the good sale
transaction; and (v) It is possible to determine the costs related to the goods
sale transaction.
THONG NHAT CORP | 55
ANNUAL REPORT | 58
Sales from service provision
Sales from service provision transactions are recognised when the results of
these transactions are determined in a reliable way. The result of a service
provision transaction are determined only when it satisfies all the following
conditions: (i) Sale can be reliably measured; (ii) It is possible to obtain
economic benefits from the service provision transaction; (iii) The work volume
finished on the date of making the accounting balance sheet can be
determined; and (iv) The costs incurred from the service provision transaction
and the costs of its completion can be determined
Income from interests, royalties, distributed dividends and profits
Income arising from interests, royalties, distributed dividends and profits of the
Company are recognised if they simultaneously satisfy the following conditions: (i) It is
possible to obtain economic benefits from the concerned transactions; and (ii) Income
can be reliably measured.
11. Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or
production of qualifying assets, which are assets that necessarily take a
substantial period of time to get ready for their intended use or sale, are added
to the cost of those assets, until such time as the assets are substantially ready
for their intended use or sale. Investment income earned on the temporary
investment of specific borrowings pending their expenditure on qualifying
assets is deducted from the cost of those assets. All other borrowing costs are
recognised in the income statement when incurred.
The borrowings incurred in the current period are paid directly to the suppliers.
Therefore the cash flow which is used to make payments directly are not
presented in Cash Flow from Financing Activities.
12. Taxation
Current income tax
Current income tax is based on taxable profit for the year. Taxable profit differs
from net profit as reported in the income statement because it excludes items
of income or expense that are taxable or deductible in other years (including
loss carried forward, if any) and it further excludes items that are never taxable
or deductible.
The determination of the current income tax is based on the current
interpretation of tax regulations. However, these regulations are subject to
periodic variation and their ultimate determination depends on the results of the
tax authorities’ examinations.
Deferred tax
Deferred tax is recognised on significant differences between carrying amounts
of assets and liabilities in the financial statements and the corresponding tax
bases used in the computation of taxable profit and is accounted for using
balance sheet liability method. Deferred tax liabilities are generally recognised
for all temporary differences and deferred tax assets are recognised to the
extent that it is probable that taxable profit will be available against which
deductible temporary differences can be utilised.
Deferred tax is calculated at the tax rates that are expected to apply in the
period when the liability is settled or the asset realised. Deferred tax is charged
or credited to profit or loss, except when it relates to items charged or credited
directly to equity, in which case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable
right to set off current tax assets against current tax liabilities and when they
relate to income taxes levied by the same taxation authority and the Company
intends to settle its current tax assets and liabilities on a net basis.
Other taxes
Other taxes are paid in accordance with the prevailing tax laws in Vietnam.
THONG NHAT CORP | 57
ANNUAL REPORT | 60
V. ADDITIONAL INFORMATION FOR ITEMS SHOWN IN THE
CONSOLIDATED BALANCE SHEET
(Unit: VND)
1. Cash and cash equivalents
(*) The proceeds from selling of equitization of Vietnam Tea Corporation - .JSC
2. Trade receivables
Ending balance Beginning
balance
Cash on hand 1.546.666.291 5.709.015.545
Cash in bank 57.411.684.395 5.743.057.168
Deposit in escrow account (*) 357.490.678.605 -
Total 416.449.029.291 11.452.072.713
Ending balance Beginning
balance
a. Short-term trade receivables 344.059.027.580 259.035.877.933
- Quang Nam Rubber .JSC - -
- Viet Lao Agricultural Joint Venture .JSC - -
- Duc Nguyen Export & Import .JSC - -
- Mien Trung Plastic .JSC - -
- Thai Nguyen Investment & Industrial Services
.JSC 20.246.059.246 157.051.312.350
- An Thinh Commerce & Services .JSC 53.828.014.500 -
- Thinh Phat BP Ltd. 25.968.082.300
- Holland Vietnam Coffee Ltd. 12.479.129.390
- Chi Hoan Construction Materials .JSC 13.382.858.566 8.814.919.837
- Viettel Networks Corporation 48.926.592.000 -
- Trade receivables from other clients 169.228.291.578 93.169.645.746
b. Long-term trade recivables 6.908.681.864 -
- Trade receivables from other clients 6.908.681.864
c. Trade receivables from related parties - -
3. Receivables from lending
Ending balance Beginning
balance
a. Receivables from short-term lending(*) 7.700.000.000 39.192.100.000
- West Ocean Invest .JSC - 33.000.000.000
- Thanh Mai Co. - 5.000.000.000
- Mien Trung Plastic .JSC - -
- Thong Nhat Infrastructure .JSC 2.700.000.000 -
- Moc Chau Industrial Bamboo .JSC - -
- Individuals 5.000.000.000 1.192.100.000
b. Receivables from long-term lending - -
c. Receivables from related parties - -
(*) Individuals and companies borrowed under loan contracts with terms less than 12
months, interest rate of 8 – 10%/year.
4. Other receivables
Ending balance Beginning balance
Value Provision Value Provision
a. Short-term 91.149.011.334 - 140.644.613.498 -
- Advance payments 20.234.511.103 30.139.313.415 -
- Escrow deposits 14.712.661.331 - 816.481.090 -
- Receivables from capital
transfer
+ Nguyen Thi Huong Tra 10.500.000.000 11.250.000.000 -
+ Nguyen Thi Thanh Hoa - 6.750.000.000 -
+ Nguyen Thi Minh Thu - 37.100.000.000 -
+ Nguyen Thi Thai - 6.000.000.000 -
+ Nguyễn Sy Hien - 15.000.000.000 -
+ Trịnh Thi Huong - 30.800.000.000 -
+ Nguyen Quynh Ngoc 5.040.000.000 - -
+ Vu Thi Huong Quynh 3.780.000.000 - - -
+ Nguyen Van Nghia 12.600.000.000 - -
- Interest receivables 8.573.805.258 2.004.894.107 -
- Other short-term receivables 15.708.033.642 783.924.886 -
b. Long-term 30.000.000.000 - - -
- Hop Thanh Investment &
Minerals .JSC 30.000.000.000 -
Total 121.149.011.334 - 140.644.613.498 -
THONG NHAT CORP | 59
ANNUAL REPORT | 62
7. Financial investments 5. Inventories
Ending Balance Beginning balance
Cost Provision Cost Provision
- Raw materials 19.699.736.990 - 19.289.338.033 -
- Tools and supplies 3.402.750.952 - 692.506.629 -
- Work in progress 67.100.419.873 - 37.458.876.867 -
- Finished goods 27.273.558.915 - 26.222.937.239 -
- Merchandise 6.825.300.413 - 3.781.411.146 -
Total 124.301.767.143 - 87.445.069.914 -
6. Prepaid expenses
Ending balance Beginning
balance
a. Short-term 477.860.625 119.529.330
- Prepaid expenses for operating leases -
- Allocated tools and supplies 326.865.711 91.502.043
- Other prepaid expenses 150.994.914 28.027.287
b. Long-term 6.647.991.333 5.785.648.780
- Purchasing office furniture 1.896.496.819 389.180.924
- Allocated tools and supplies 106.670.173 2.722.314.436
- Other prepaid expenses 4.644.824.341 2.674.153.420
Total 7.125.851.958 5.905.178.110
Beg
inn
ing
bala
nce
Pro
vis
ion
(866.5
70
.00
5) -
(866.5
70
.00
5) -
(866.5
70
.00
5)
Be
gin
nin
g b
alan
ce
Pro
visi
on
- - - - - - - - - - - -
Fair
val
ue
8.8
82.0
31
.00
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5.3
62.0
31
.00
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3.5
20.0
00
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8.8
82.0
31
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Fair
val
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-
69.2
70.8
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.00
0 - - - - - - - - -
69
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st
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59
En
din
g b
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Pro
vis
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- - - - -
End
ing
bal
ance
Pro
visi
on
- - - - - - - - - - - -
Fair
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69.6
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5
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92
a.
Tra
din
g s
ecu
riti
es
To
tal
va
lue o
f tr
ad
ing
secu
riti
es
+
Vie
tnam
Sea T
ransport
and C
hart
ering .
JS
C (
VF
R)
+
South
ern
Fert
ilizer
.JS
C (
SF
G)
+
Vie
tnam
Liv
esto
ck C
orp
ora
tion -
.JS
C (
VLC
)
To
tal
b.
Held
-to
-matu
rity
in
ve
stm
en
ts
* In
vestm
en
ts i
n j
oin
t ven
ture
s a
nd
asso
cia
tes
- G
ranite P
hu
yen .
JS
C
- Lam
do
ng
Foodstu
ffs .
JS
C
- G
B-T
EA
Pro
duction I
nvestm
ent
& S
ale
s .
jSC
- P
hu
Da T
ea C
om
pany
- T
ran P
hu
Tea .
JS
C
- K
im A
nh T
ea
.JS
C
- T
hai N
guye
n T
ea
.JS
C
- T
echnic
al M
ate
rials
Constr
uction .
JS
C
- H
a T
inh
Tea .
JS
C
- P
acific
Com
merc
ial .J
SC
* G
ain
(lo
ss)
in j
oin
t ven
ture
s a
nd
asso
cia
tes
To
tal
THONG NHAT CORP | 61
ANNUAL REPORT | 64
Be
gin
nin
g b
ala
nc
e
Pro
vis
ion
- - - - -
(*)
Acc
ord
ing
to
Circu
lar
No
. 2
00
TT
-BT
C d
ate
d 1
2/2
2/2
01
4,
the
fa
ir v
alu
e o
f i
nve
stm
en
ts n
ee
d t
o b
e p
rese
nte
d.
Ho
we
ver,
th
e c
om
pa
ny
only
ass
ess
ed f
or
liste
d c
om
pa
ny
as
at
31
/12
/201
5.
Fo
r un
liste
d C
om
pa
nie
s, t
he
Co
mp
an
y h
as
no
t a
sse
sse
d t
he f
air
va
lue
of
these
fin
anci
al in
vest
men
ts,
beca
use
th
e V
ietn
am
Acc
oun
ting S
tand
ard
s, E
nte
rprise
Acc
ou
ntin
g S
yste
m V
ietn
am
ha
ve n
ot
yet
guid
ance
ab
ou
t a
sse
ssin
g f
air v
alu
e.
Fa
ir v
alu
e
- - - - -
Co
st
87.0
00.0
00.0
00
- - -
87.0
00.0
00.0
00
En
din
g b
ala
nc
e
Pro
vis
ion
- - - - -
Fa
ri v
alu
e
- - - - -
Co
st
79.5
00.0
00.0
00
30.6
00.0
00.0
00
18.0
00.0
00.0
00
131
.864
.000
* E
qu
ity
in
ve
stm
en
ts in
oth
er
en
titi
es
- T
hon
g N
ha
t O
ne M
em
ber
Co
.,Ltd
- P
hu Y
en
Gra
nite
., J
SC
- C
ha
u G
ian
g N
LN
., J
SC
- O
thers
To
tal
Tota
l
25
8.2
49
.47
4.1
97
30
7.9
03
.68
7.9
88
7.7
54
.15
4.7
93 -
30
0.1
49
.53
3.1
95
34
.975
.121
.844
30
.440
.675
.708
4.5
34
.44
6.1
36
53
1.1
78
.04
0.3
41
32
.262
.110
.265
17
7.5
77
.06
5.1
90
20
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.986
.348
15
6.8
31
.07
8.8
42
5.1
88
.13
1.8
06
4.5
80
.18
5.8
56
60
7.9
45
.95
0
20
4.6
51
.04
3.6
49
22
5.9
87
.36
3.9
32
32
6.5
26
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6.6
92
Oth
ers
3.2
00
.26
7.1
12
13
.454
.132
.930 - -
13
.454
.132
.930
16
3.6
36
.36
4
16
3.6
36
.36
4 -
16
.490
.763
.678
91
0.9
89
.21
6
11
.389
.308
.417
60
7.3
26
.14
4
10
.781
.982
.273 - - -
12
.300
.297
.633
2.2
89
.27
7.8
96
4.1
90
.46
6.0
45
Off
ice
equ
ipm
ents
54
3.5
80
.72
8
1.8
26
.55
5.6
71
72
.900
.000 -
1.7
53
.65
5.6
71 - - -
2.3
70
.13
6.3
99
16
6.0
31
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2
1.0
72
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8.3
23
11
4.3
49
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4
95
8.4
08
.32
9 - - -
1.2
38
.79
0.2
05
37
7.5
48
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6
1.1
31
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6.1
94
Tran
spo
rtat
ion
mea
ns
3.4
91
.12
9.5
55
17
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.962
.648
5.0
35
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1.0
00 -
12
.482
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1.2
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7.2
42
70
6.2
51
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6
53
4.4
46
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6
19
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.394
.961
1.1
32
.72
2.3
55
9.3
13
.30
2.7
27
59
6.9
96
.50
1
8.7
16
.30
6.2
26
85
3.4
36
.93
2
68
9.9
35
.42
6
16
3.5
01
.50
6
9.5
92
.58
8.1
50
2.3
58
.40
7.2
00
10
.175
.806
.811
Mac
hin
erie
s,
equ
ipm
ents
15
5.4
05
.83
1.7
10
77
.551
.626
.483
2.0
65
.70
9.9
65
-
75
.485
.916
.518
29
.570
.788
.238
29
.570
.788
.238 -
20
3.3
86
.66
9.9
55
21
.728
.818
.672
47
.667
.393
.139
13
.166
.082
.392
34
.501
.310
.747
3.8
90
.25
0.4
30
3.8
90
.25
0.4
30
-
65
.505
.961
.381
13
3.6
77
.01
3.0
38
13
7.8
80
.70
8.5
74
Bu
ildin
gs,
stru
ctu
res
95
.608
.665
.092
19
7.5
53
.41
0.2
56
58
0.1
43
.82
8 -
19
6.9
73
.26
6.4
28
4.0
00
.00
0.0
00 -
4.0
00
.00
0.0
00
28
9.1
62
.07
5.3
48
8.3
23
.54
8.1
40
10
8.1
34
.30
2.5
84
6.2
61
.23
1.3
17
10
1.8
73
.07
1.2
67
44
4.4
44
.44
4 -
44
4.4
44
.44
4
11
6.0
13
.40
6.2
80
87
.285
.116
.952
17
3.1
48
.66
9.0
68
8.
T
an
gib
le f
ixe
d a
sse
ts
CO
ST
Beg
inn
ing
ba
lan
ce
Ad
dit
ion
s
Pu
rch
ase
d
Fin
ish
ed c
on
str
uctio
n inve
stm
en
t
Incre
ased
by c
on
so
lida
te
Dec
rea
se
Decre
ase
d b
y c
onsolid
ate
Liq
uid
atin
g d
isp
osin
g
En
din
g b
ala
nce
AC
CU
MU
LA
TE
D D
EP
RE
CIA
TIO
N
Beg
inn
ing
ba
lan
ce
Ad
dit
ion
s
Dep
recia
tio
n fo
r th
e y
ea
r
Incre
ased
by c
on
so
lida
te
Dec
rea
se
Decre
ase
d b
y c
onsolid
ate
Liq
uid
atin
g d
isp
osin
g
En
din
g b
ala
nce
NE
T B
OO
K V
AL
UE
Beg
inn
ing
ba
lan
ce
En
din
g b
ala
nce
THONG NHAT CORP | 63
ANNUAL REPORT | 66
9. Intangible fixed assets
10. Trade Payables
THONG NHAT CORP | 65
Items Acounting softwares Total
COST
Beginning balance 100,000,000 100,000,000
Purchased 30,500,000 30.500.000
Increased by consolidate 730,269,126 730.269.126
Ending balance 860,769,126 860,769,126
ACCUMULATED AMORTISATION
Beginning balance 21,666,671 21,666,671
Depreciation for the year 20,054,663 20.054.663
Increased by consolidate 698,371,409 698.371.409
Ending balance 740,092,743 740,092,743
NET BOOK VALUE
Beginning balance 78,333,329 78,333,329
Ending balance 120,676,383 120,676,383
Ending balance
Beginning balance
Amount
Amount able to be paid off
Amount
Amount able to be paid off
a. Short-term trade payables 80,404,696,898
80,404,696,898
154,438,469,747
154,438,469,747
- Quang Binh Import & Export., JSC -
-
32,262,595,904
32,262,595,904
- Nhan Duc Import & Export., JSC -
-
12,060,050,000
12,060,050,000
- Drilling MUD Coporation -
-
60,765,907,950
60,765,907,950
- DAP Vinachem Co., Ltd -
-
22,000,000,000
22,000,000,000
- Sao Thai Duong Investment., JSC -
-
-
-
- Hoang Truong Construction and Transportation Co., Ltd 2,002,700,000
2,002,700,000
-
-
- Viet Phong Production-Trading-Service Co., Ltd 11,532,850,400
11,532,850,400
-
-
- Sam Phu., JSC 3,454,183,525
3,454,183,525
-
-
- Others 63,414,962,973
63,414,962,973
27,349,915,893
27,349,915,893
b. Long-term trade
payables Total 80,404,696,898
80,404,696,898
154,438,469,747
154,438,469,747
11
. T
ax
es
an
d a
mo
un
ts p
ay
ab
le t
o t
he
Sta
te b
ud
ge
t
En
din
g b
ala
nce
pa
ya
ble
s
8.1
71
.00
2.4
93
-
10
.244
.157
9.5
17
.95
1.0
54
39
.796
.447
3.8
69
.85
8 -
1.8
29
.29
2.3
23
-
19
.572
.156
.332
En
din
g b
ala
nce
rec
eiv
ab
les
-
11
9.0
06
.75
8 - - -
7.1
29
.62
2 - - -
8.5
39
.67
6
13
4.6
76
.05
6
Pa
id d
uri
ng
th
e
ye
ar
75
.727
.251
.607
5.8
09
.57
9.0
96
-
30
9.5
58
.82
6
17
.651
.339
.103
93
.046
.146 - -
14
2.5
85
.72
9
8.5
39
.67
6
99
.741
.900
.183
Pa
ya
ble
s d
uri
ng
the
yea
r
82
.612
.033
.187
5.6
90
.57
2.3
38
-
29
5.0
15
.38
5
10
.642
.913
.762
46
.384
.937
3.8
69
.85
8 -
1.8
40
.29
2.3
23
-
10
1.1
31
.08
1.7
90
Beg
inn
ing
ba
lan
ce
pa
ya
ble
s
1.2
88
.90
6.0
23 -
24
.787
.598
16
.526
.376
.395
79
.328
.034 - -
13
1.5
85
.72
9 -
18
.050
.983
.779
Beg
inn
ing
ba
lan
ce
rec
eiv
ab
les
2.6
85
.11
0 - - - - - - - -
2.6
85
.11
0
ANNUAL REPORT | 68
12. Loans and obligations under finance leases (continued)
(i): Loan frrom Agribank - Thu Do Branch under the contract follow: - The Credit Contract No.1483-LAV-201500422 dated 12/08/2015, loan limits is 1,400,000,000 VND. The purpose of borrowing is payment for the purchase of goods. 6 months loan term with interest rate at the time of borrowing is 10%/year. - The Credit Contract No.1483-LAV-201500484 dated 21/09/2015, loan limits is 46,000,000,000 VND. The purpose of borrowing is payment for the purchase of goods. 5 months loan term, interest rate at the time of borrowing is 5,5%/year in the first 3 months and apply normal interest rates of agribank from 4th month.. - The Credit Contract No.1483-LAV-201500445 dated 28/08/2015, loan limits is 72,000,000,000 VND. The purpose of borrowing is payment for the purchase of goods. 5 months loan term, interest rate at the time of borrowing is 5,5%/year in the first 3 months and apply normal interest rates of agribank from 4th month.. - Form of security: Security with land use rights of third parties. (ii): Loan from West Ocean Invest., JSC under the credit contract No.0110/HĐVV/TN-IT dated 01/10/2015, with amount 67,000,000,000VND. The purpose of borrowing is additional capital for production and business activities. 5 months
loan term, interest rate 8%/year . Unsecured loans. (iii) Loan frrom Techconbank – Da Nang Branch under the contract follow: -The Credit Contract DNG2014.0237/HĐHMTD dated 10/10/2014, loan limits is 27 billion VND including credit limit of 10 billion, the guarantee limit 10 billion, the limit L/C 7 billion. 12 months loan term, interest rate specified in each loan contracts. -The Credit Contract DNG2015.1292/HĐHMTD dated 24/06/2015, loan limits is 32 billion VND. The purpose of borrowing: Supply of PVC pipe underground constructions deployed in 2014 of Viettel Network coporation- Viettel Group Branch. 12 months loan term, interest rate specified in each loan contracts. (iv): Loans from individuals, interest rate 6-7%/year, 6 months loan term (v): Bonds issued: The company issued bonds under the Board of Management Resolution No. 33/2015/NQ/HĐQT with the number of bonds is 200 bonds with par value: 1,000,000,000 VND. 3 years term from the date of 10/12/2015, the interest rate of 8.3% / year. . (vi): Loans from Bank in Vinatea and subsidiaries .
THONG NHAT CORP | 67
ANNUAL REPORT | 70
13. Short-term accrued expenses
Ending balance Beginning
balance
Interest 12.767.376.923 66.536.635
Other 139.615.919
Total 12.906.992.842 66.536.635
14. Other payables
Ending balance Beginning
balance
a. Short-term
- Trade Union funds 24.017.617 67.580.584
- Social, Health, Unemployment insurance 19.407.100 162.887.111
- Paybles in equitization and other payables of
Vietnam Tea Corporation 331.826.748.704 -
- Other payables 102.696.320 4.232.191.067
Total 331.972.869.741 4.462.658.762
- -
b. Long-term
- Other payables 5.745.024.396 -
Total 5.745.024.396 -
15. Owners’ equity
15.1. Changes in owners’ equity
(*) Capital increase frrom profit after tax by resolution of the Annual Shareholders Meeting on 08
May 2015 of Thong Nhat Production and investment.,JSC. Number of share dividend
corresponding to 10% of current shares.
15.2. Shares
THONG NHAT CORP | 69
Ending
balance Beginning balance
Shares Shares
Authorized shares 74,800,000 68,000,000
Issued shares 74,800,000 68,000,000
Ordinary shares 74,800,000 68,000,000
Preference shares - -
Shares in circulation 74,800,000 68,000,000
Ordinary shares 74,800,000 68,000,000
Preference shares - -
* Par value of outstanding share: VND 10,000
Contributed capital
Investment and development
fund
Other owners'
capital
Retained earnings
Total
PREVIOUS YEAR
Beginning balance 680,000,000,000 - - 27,624,686,024 707,624,686,024
Profit for the year - - - 86,456,120,446 86.456.120.446
Other increase - - - 1,076,100,867 1.076.100.867
Ending balance 680,000,000,000 - - 115,156,907,337 795,156,907,337
CURRENT YEAR
Beginning balance 680,000,000,000 - - 115,156,907,337 795,156,907,337
Capital increase 68,000,000,000 - - - 68.000.000.000
Profit for the year - - - 54,900,054,342 54.900.054.342
Capital decrease - 683,081,038 221,299,709 - 904.380.747
Dividend - -
(68,000,000,000) (68.000.000.000)
Other decrease - - - (105,476,068) (105.476.068)
Ending balance 748,000,000,000 683,081,038 221,299,709 101,951,485,611 850,855,866,358
ANNUAL REPORT | 72
VI. ADDITIONAL INFORMATION FOR ITEMS SHOWN IN THE
CONSOLIDATED INCOME STATEMENT
(Unit: VND)
1. Revenues from sales of goods and rendering of services
31/12/2015 31/12/2014
Gross revenue 2.109.286.422.692 635.571.120.845
Sales of goods 2.059.458.267.898 565.782.312.625
Revenue from construction activities 49.730.887.099 58.848.266.223
Revenue from services providing 97.267.695 10.940.541.997
Deduction 362.794.250 99.110.100
Returned goods 362.794.250 99.110.100
Net revenue 2.108.923.628.442 635.472.010.745
Revenue from related parties
- West Ocean Invest .JSC 256.875.400.727 -
2. Cost of goods sold
31/12/2015 31/12/2014
Cost of merchandise sold 1.996.099.522.882 530.520.049.333
Cost of construction activities 49.730.887.099 45.717.361.630
Cost of services 91.330.495 5.681.353.004
Total 2.045.921.740.476 581.918.763.967
3. Financial income
31/12/2015 31/12/2014
Bank and loan interest 2.215.222.406 4.276.171.122
Change in foreign currency translation 2.425.539 8.443.386
Dividends and profits received 400.360.000 376.414.000
Gains from shares transfer 27.769.695.624 57.600.000.000
Interest on short-term securities investment 4.137.299.000 15.967.654.624
Payments discounts 457.456.281 74.729.600
Total 34.982.458.850 78.303.412.732
4. Financial expenses
31/12/2015 31/12/2014
Interest expense 14.922.773.127 732.772.163
Loss from short-term securities investments 1.424.694.571 1.435.326.250
Provisions for short-term investments (866.570.005) 303.934.060
Loss from change in foreign currency translation
169.762.809 69.900.746
Other financial expenses 252.430.109 1.700.000.897
Total 15.903.090.611 4.241.934.116
5. Other expenses
6. Administrative and general expenses
7. Other profits
31/12/2015 31/12/2014
Administrative expenses 1.416.324.660 1.409.130.479
Purchasing stationeries 30.314.476 31.800.815
Depreciation and amortization expenses 34.877.044 137.795.626
Cost of hired services 6.414.941.509 2.694.600.342
Other selling expenses 857.812.253 316.273.963
Total 8.754.269.942 4.589.601.225
31/12/2015 31/12/2014
Administrative expenses 3.430.665.489 2.683.953.006
Purchasing stationeries 292.401.195 429.685.573
Depreciation and amortization expenses 748.608.644 854.843.616
Cost of hired services 5.382.135.441 3.409.460.822
Other selling expenses 5.159.698.693 2.517.277.823
Total 15.013.509.462 9.895.220.840
31/12/2015 31/12/2014
Other income 14.576.547.253 1.201.898.892
Gains from liquidation of fixed assets 6.184.499.264 -
Proceeds from liquidation of tools and supplies 357.208.182
Other income 8.034.839.807 1.201.898.892
THONG NHAT CORP | 71
ANNUAL REPORT | 74
8. Current corporate income tax expense
9. Earnings per share
10. Operating expenses are classified by nature
Other expenses 10.349.108.386 1.014.755.695
Loss from liquidation of fixed assets - 180.979.318
Expenses from liquidation of tools and supplies 3.010.843.845
Tax penalties, fines for tax payment delayed 365.784.419 315.876.838
Fines of contract performance 2.042.838.046 -
Other expenses 4.929.642.076 517.899.539
Other profits 4.227.438.867 187.143.197
31/12/2015 31/12/2014
CIT from parent company 6.518.875.905 21.735.810.428
CIT from subsidiaries 4.215.164.664 2.053.821.958
Total 10.734.040.569 23.789.632.386
The income tax expenses of the Company have been identified base on the current tax
policies. However, theses policies have been changed by the time and the final income tax
identification depends on the decision of the tax authorities.
31/12/2015 31/12/2014 (*)
Net profit after tax 54.900.054.342 86.456.120.446
Adjustments:
- Dividends of preferred shares - -
- Bonus and welfare funds - -
Profit (Loss) attributable to ordinary equity holders
54.900.054.342 86.456.120.446
Weighted average number of ordinary shares
(Shares) 74.800.000 74.800.000
Basic earnings per share 734 1.156
31/12/2015 31/12/2014
Raw materials and consumables 92.307.874.715 114.783.706.317
Labour 9.722.593.723 13.559.877.333
Depreciation and amortization 22.044.844.588 20.062.654.826
Hired services 15.295.281.768 15.718.688.499
Other expenses 41.032.159.738 1.106.906.579
Total 180.402.754.532 165.231.833.554
THONG NHAT CORP | 73
ANNUAL REPORT | 76
VII. OTHER INFORMATION
(Unit: VND)
1. Information of related parties
Relationships with related parties
Transactions with related parties incurred during the fiscal year
Related parties Business content Value (VND)
West Ocean Invest .JSC Selling merchandise 256.875.400.727
West Ocean Invest .JSC Borrowing 67.000.000.000
West Ocean Invest .JSC Interest 1.295.333.333
Mien Trung Plastic .JSC Lending 2.760.000.000
Mien Trung Plastic .JSC Selling merchandise 7.662.050.850
Mien Trung Plastic .JSC Interest 52.710.000
Moc Chau Industrial Bamboo .JSC Lending 929.500.000
Moc Chau Industrial Bamboo .JSC Interest 14.458.889
Balances with related parties as at 31/12/2015
Related parties Business content Value (VND)
West Ocean Invest .JSC Short-term borrowings 67.000.000.000
West Ocean Invest .JSC Accrued expenses 1.295.333.333
West Ocean Invest .JSC Short-term lending 2.760.000.000
Mien Trung Plastic .JSC Short-term lending 929.500.000
Mien Trung Plastic .JSC Trade receivables 5.003.055.935
Mien Trung Plastic .JSC Advances to suppliers 3.000.000.000
Moc Chau Industrial Bamboo .JSC Advances to suppliers 20.000.000.000
Moc Chau Industrial Bamboo .JSC Short-term borrowings 67.000.000.000
Income of members of Management Board and Board of Directors
31/12/2015 31/12/2014
Income of Management Board and BOD 1.076.460.000 984.000.000
Total 1.076.460.000 984.000.000
THONG NHAT CORP | 75
Related parties Relationship
Mien Trung Plastic .JSC Subsidiary
Moc Chau Industrial Bamboo .JSC Subsidiary
Moc Chau Tea – A Vinatea branch Subsidiary West Ocean Invest .JSC Mr. Nguyen Tri Thien is Chairman Chau Giang NLN .JSC Joint venture
2.
S
eg
me
nt
info
rma
tio
n
Se
gm
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t in
form
atio
n is
pre
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BU
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Sa
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to e
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and
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go
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sold
and
ser
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s re
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lloca
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expe
nse
s
Fina
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expe
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s
Shar
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f net
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s
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ANNUAL REPORT | 78
3.1. Financial instruments
3.1. Financial instruments (continued)
The Company has not assessed fair value of its financial assets and liabilities as at the
balance sheet date since there are no comprehensive guidance under Circular 210 and
other relevant the statutory requirements relevant to preparation and presentation of
consolidated financial statement to determine fair value of these financial assets and
liabilities.
3.2. Capital risk management
The Company manages its capital to ensure that the Company will be able to continue as
a going concern while maximising the return to owners through the optimisation of the
debt and equity balance.
The capital structure of the Company consists of net debt (borrowings offset by cash and
cash equivalents) and owners’ equity (comprising capital, reserves and retained
earnings).
3.3. Financial risk management
Financial risks include market risk (including foreign currency risk, interest rate risk and
price risk), credit risk and liquidity risk. The Company does not hedge these risk
exposures due to the lack of any market to purchase financial instruments.
THONG NHAT CORP | 77
Carrying value
31/12/2015 31/12/2014
Financial assets Cash and equivalents 416.449.029.291 11.452.072.713
Trade receivables and other receivables 442.116.720.778 399.680.491.431
Short-term investments 74.810.227.391 48.074.131.000
Long-term investments 413.811.749.592 203.912.890.759 Other financial assets
Total 1.347.187.727.052 663.119.585.903
Financial payables
Loans 604.350.770.392 30.681.888.189
Trade payables and other payables 418.122.591.035 158.901.128.509
Accrued expenses 12.906.992.842 66.536.635
Total 1.035.380.354.269 189.649.553.333
2.2
.
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3.
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("C
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tern
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tan
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Sale
s to
ext
erna
l cus
tom
ers
Cost
of g
ood
s so
ld
Gro
ss p
rofit
Se
gm
en
t ass
ets
Se
gm
en
t lia
bili
ties
ANNUAL REPORT | 80
3.3.1 Interest rate risk management
Interest rate risk is the risk that the fair value or future cash flows arising from a
financial instrument will fluctuate with changes in market interest rates. The risk is
managed by the Company by maintaining an appropriate level of borrowings and
analyzing market competition to enjoy favorable interest rates from appropriate
lenders.
3.3.2 Share price risk management
Shares held by the Company are affected by market risks arising from the uncertainty
about future prices of such shares. The Company manages this risk exposure by setting
up investment limits and analyzing market.
3.3.3 Credit risk management
Credit risk refers to the risk that counterparty will default on its contractual obligations
resulting in financial loss to the Company. The Company has a credit policy in place and
the exposure to credit risk is monitored on an ongoing basis.
3.3.4 Liquidity risk management
The purpose of liquidity risk management is to ensure the availability of funds to meet
present and future financial obligations. Liquidity is also managed by ensuring that the
excess of maturing liabilities over maturing assets in any period is kept to manageable
levels relative to the amount of funds that the Company believes can generate within
that period. The Company policy is to regularly monitor current and expected liquidity
requirements to ensure that the Company maintains sufficient reserves of cash,
borrowings and adequate committed funding from its owners to meet its liquidity
requirements in the short and longer term.
Credit risk refers to the risk that counterparty will default on its contractual obligations
resulting in financial loss to the Company. The Company has a credit policy in place and
the exposure to credit risk is monitored on an ongoing basis.
THONG NHAT CORP | 79
Items Less than 1 year From 1 - 5 years Total
FINANCIAL LIABILITIES
Ending balance
Borrowings 390.747.465.133 213.603.305.259 604.350.770.392
Trade and other payables 412.377.566.639 5.745.024.396 418.122.591.035
Accrued expenses 12.906.992.842 - 12.906.992.842
Total 816.032.024.614 219.348.329.655 1.035.380.354.269
Beginning balance
Borrowings 30.681.888.189 - 30.681.888.189
Trade and other payables 158.901.128.509 - 158.901.128.509
Accrued expenses 66.536.635 - 66.536.635
Total 189.649.553.333 - 189.649.553.333
FINANCIAL ASSETS
Ending balance
Cash and cash equivalents 416.449.029.291 - 416.449.029.291
Trade and other receivables 442.116.720.778 - 442.116.720.778
Short-term financial investments 74.810.227.391 - 74.810.227.391
Long-term financial investments - 413.811.749.592 413.811.749.592
Other financial assets - -
Total 933.375.977.460 413.811.749.592 1.347.187.727.052
Beginning balance
Cash and cash equivalents 11.452.072.713 - 11.452.072.713
Trade and other receivables 399.680.491.431 - 399.680.491.431
Short-term financial investments 48.074.131.000 - 48.074.131.000
Long-term financial investments - 203.912.890.759 203.912.890.759
Other financial assets -
Beginning balance
Cash and cash equivalents 25,864,391,595 - 25,864,391,595
Trade and other receivables 79,361,296,500 - 79,361,296,500
Short-term financial investments 104,327,366,628 - 104,327,366,628
Long-term financial investments - 554,957,692,160 554,957,692,160
Other financial assets 205,830,000 - 205,830,000
Total 209,758,884,723 554,957,692,160 764,716,576,883
ANNUAL REPORT | 82
4. Subsequent events
The company has been received the 11th adjusted Business Registration Certificate
No.0105334948 by Ha Noi Department of Planning and Investment dated 2/2/2016.
Charter capital has increased to VND 1,500 billion.
5. Contingent liabilities
There are no Contingent liabilities need to present in the Financial Statements as at
31/12/2015.
6. Comparative figures
The financial statements for the year ended 31/12/2014 have been audited by Vietland
auditing and consulting compay Limited.
6. Comparative figures (continued)
Some items were classified and reclassified to conform with Circular No. 200/2014/TT-
BTC issued by the Ministry of Finance on 22 December 2014 guiding the accounting
regime for enterprises for comparison with Current year. Specific:
THONG NHAT CORP | 81
CONSOLIDATED BALANCE SHEET Beginning balance
Reported figures
Co-
de Reclassified
Co-
de
A. ASSET
1. Short-term investments 48.940.701.005 121 -
2. Trading securities - 9.748.601.005 121
3. Short-term trade receivables 109.688.818.993 135
140.644.613.49
8 136
4. Short-term loan receivables - 39.192.100.000 135
5. Other current assets 30.955.794.505 158 - 155
6. Long-term construction in progress 1.361.401.174 230 1.361.401.174 242
B. RESOURCES
1. Non-controlling interests - 70.766.551.123 429
2. Minority interest 70.766.551.123 439 -
CONSOLIDATED INCOME STATEMENT
Beginning balance
Reported figures
Co-
de Reclassified
Co-
de
1. Gross revenue from goods sold and
services rendered 635.725.459.811 01
635.571.120.84
5 01
2. Deductions 253.449.066 02 99.110.100 02
12. Other income 3.613.717.073 0 1.201.898.892 31
13. Other expenses 3.426.573.876 0 1.014.755.695 32
19. Basic earnings per share 1.271 70 1.156 70
CONSOLIDATED CASH FLOW STATEMENT
Beginning balance
Reported figures
Co-
de Reclassified
Co-
de
- (Increase)/Decrease in trading securities - 30.741.401.568 13
- Other cash inflows 62.865.977.935 15 364.601.306 16
- Other cash outflows (32.360.626.151) 16 (600.651.090) 17
Ta Van Quyen
Chief Executive Officer
March, 2016
Hoang Manh Cuong
Chief Accountant
Nguyen Thi Thu Huyen
Preparer
THONG NHAT CORP | 83
THONG NHAT PRODUCTION AND INVESTMENT .JSC TICKER: GTN
Company name Thong Nhat Production & Investment Joint Stock Company
Abbreviation GTN
Charter capital VND1,500 bn
Headquarter 2nd Floor, CEO Tower, HH2-1 Block, Pham Hung Street, Hanoi
Tel. (84-4) 6276 6366
Fax (84-4) 6276 6466
Email [email protected]
Website www.thongnhatcorp.vn
Business registration license and tax identification number: 0105334948
Company name Thong Nhat Production & Investment Joint Stock Company
ANNUAL REPORT | 84
ABBREVIATIONS
The Company Thong Nhat Production and Investment Joint Stock Company
GTN Thong Nhat Production and Investment Joint Stock Company
Vinatea Vietnam Tea Corporation – Joint Stock Company
JSC Joint Stock Company
CEO Chief Executive Officer
BOD Board of Directors
HOSE Ho Chi Minh City Stock Exchange
ANNUAL REPORT 2015
THONG NHAT PRODUCTION AND INVESTMENT .JSC
THONG NHAT CORP | 85
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