BỘ GIÁO DỤC VÀ ĐÀO TẠO

TRƯỜNG ĐẠI HỌC KINH TẾ TP.HCM

GROUP ASSIGNMENT

FPT GROUP
FINANCIAL STATEMENT
ANALYSIS

Lecturer: Le Thi Phuong Vy

Majors: Finance

1
 Ho Chi Minh City - 2020

GROUP MEMBER
Hoàng Thu Thảo
Lý Quế Anh
Châu Dương Khoa
Nguyễn Hoàng Nhật Vy

Contents
An introduction:...............................................................................................................................................................3
Business Environment analysis........................................................................................................................................5
o Industry analysis..................................................................................................................................................5
o SWOT analysis.....................................................................................................................................................6
Analysis of income statement and balance sheet............................................................................................................7
the most recent year-end balance sheet (3 consecutive years) of the company:.........................................................7
o asset situation.................................................................................................................................................7
o Liabilities & Shareholders' Equity situation.....................................................................................................8
the most recent year’s income statement (3 consecutive years) of the company:......................................................9
Ratio Analysis................................................................................................................................................................10
1) Liquidity ratios...................................................................................................................................................10
2) Efficiency Ratios................................................................................................................................................11
 Asset turnover Ratio......................................................................................................................................11
 Fixed asset turnover ratio..............................................................................................................................12
 Inventory turnover ratio................................................................................................................................12
 Receivable turnover ratio..............................................................................................................................13
3) Long-term solvency ratio..................................................................................................................................14
 Debt-to-asset Ratio........................................................................................................................................14
 Debt-to-equity Ratio......................................................................................................................................15
 Interest coverage...........................................................................................................................................15
4) Profitability ratios.............................................................................................................................................16
 Return on Asset.............................................................................................................................................16
 Return on Equity............................................................................................................................................17
5) Market value ratio............................................................................................................................................17
Return on Invested Capital analysis:..............................................................................................................................18
 Return on Assets (ROA):....................................................................................................................................18
 Return on equity (ROE):.....................................................................................................................................19
Conclusion..................................................................................................................................................................... 21
2
Reference...................................................................................................................................................................... 21

An introduction:
o Company name: FPT CORPORATION
o Abbreviation name: FPT

o Company logo:
o Head office: No. 17 Duy Tan, Dich Vong Hau Ward, Cau Giay District, City. Hanoi
Vietnam
o Website: www.fpt.com.vn
o Date Established: September 13, 1988 in Viet Nam
o the company's independent (external) audit firm: Deloitte Vietnam Company Limited
o FPT Group is one of the largest information technology service companies
in Vietnam with its core business focusing on the provision of ICT-related services.
o According to the United Nations Development Programme, it was the 14th largest
company in Vietnam in 2007. According to Vietnam Report 2012, this was the 3rd
biggest enterprise in Vietnam. The criterion for the Vietnam Report's ranking is those
with private equity of 51% or more. In 2019, FPT's revenue reached VND 27,717
billion, an increase of 19.4% compared to 2018; Pre-tax profit reached VND 4,665
billion, up 20,9% compared to 2018. Revenue and profit from foreign markets grew
high, up 41% year-on-year.
o the ticker symbol :FPT, listed on the Ho Chi Minh City Stock Exchange (HOSE) on
December 13, 2006
o membership of the company's Board of Directors

3
THE ANNUAL GENERAL SHAREHOLDERS’ MEETING (AGM):
The AGM is the highest authority of the Corporation. Its members carry out a number
of functions and duties as stipulated in the Company Charter and relevant laws.
THE BOARD OF DIRECTORS (BOD):
The BOD is the highest governing body of the Corporation. It can act on behalf of the
Corporation to make decisions and exercise the Corporation’s rights and duties which
are not under the authority of the AGM, in accordance with the Company Charter and
relevant laws.
THE CHAIRMAN OF THE BOD:
The Chairman is the legal representative of the Corporation. The Chairman is
responsible for handling the BOD’s activities between two meeting session, and to
consider and decide the corporate governance activities of the Corporation under the
Company Charter and related legal regulations.
The Chairman of the BOD: Mr. Truong Gia Binh
THE CEO AND THE BOARD OF MANAGEMENT (BOM):
The CEO is the legal representative of the Corporation. The BOM consists of the
CEO and the Executive Vice Presidents. The CEO and the BOM are responsible for
directing the daily business activities of the Corporation which are in compliance with
the decisions of the AGM, the BOD and the Chairman of the Board.
The CEO: Mr. Bui Quang Ngoc
THE SUPERVISORY BOARD (SB):
The Supervisory Board supervises the BOD and the CEO in managing and
administering the company. It is accountable to the AGM for the performance of
assigned duties.
Head: Mr. Nguyen Viet Thang
THE PERSONNEL AND REMUNERATION COMMITTEE:
4
 is a part of the BOD. It directs the building of policy frameworks and human resource
procedures for the Corporation and all of its subsidiaries. It supports the BOD to
choose, propose, appoint, dismiss and evaluate the performance of the members of the
BOM, representatives and other senior managers of the Corporation and its
subsidiaries.
The Chairman: Mr. Do Cao Bao
THE DEVELOPMENT POLICY COMMITTEE:
is a part of the BOD. It is responsible for making development proposals to the
BOD,building strategies for the BOD, and directing and monitoring issues related to
the development strategies of the Corporation and its member companies.
The Chairman: Mr. Truong Gia Binh
THE CHAIRMAN’S OFFICE:
The Chairman’s Office is a supporting fuction under BOD. As a part of the BOD, it is
responsible for supporting the BOD and the Chairman to perform their functions and
duties.
The Chief: Mrs. Lai Huong Huyen

o The majority-owned subsidiaries of the company.

Charter Ownership Rate
Capital
(Vnd Billion)
FPT Investment Company Limited 800 100%
FPT Education Company Limited 450 100%
FPT Information System Company 850 100%
Limited
FPT Software Company Limited 377.09 100%

o In the field of software, FSOFT is leading the country in outsourcing and exporting.
With the advantage of being a pioneer in this field, FPT Software currently does not
have a competitor. This is still the most important development direction of FPT
today.
o In the telecommunications sector, which is mainly providing internet services, the
three giants FPT telecom, Viettel Telecom and VNPT account for more than 95% of
the domestic market share. In which, Viettel is a formidable competitor, gradually
surpassing VNPT and FPT is coming.

Business Environment analysis

o Industry analysis

5
  The IT industry has been considered one of the pivotal sectors for the
sustainable growth of Vietnam economy and the advancement of
Vietnam society.

 In fact, the Vietnamese government has been supporting and giving many
incentives to promote the development of IT sector for the sake of
industrialization and modernization of the country.

 The vision towards 2020 promulgated by the government is “Based on

ICT as key elements, Vietnam will quickly transform its social economic
structure to become the advanced country in term of knowledge - based
economy and information society, greatly contribute for the success of
country’s industrialization and modernization process.

o SWOT analysis

Strengths
Being the leading IT enterprise in Vietnam,
with a customer base of large corporations,
corporations, ministries, agencies and
government organizations.
Occupying a large market share in the IT
and communications industry of Vietnam.
FPT accounts for about 50% -60% of the
distribution market for information
technology products in Vietnam, while for
mobile phone product distribution, FPT
accounts for about 80% of the national
market share. The Group has more than
900 agents in all provinces nationwide.
One of the largest broadband Internet
providers in Vietnam with its wide
network, advanced technical infrastructure
and good service quality.
Aptech Training Center and FPT
Technology University provide highly
qualified human resources for the
corporation to ensure sustainable
Opportunity
Vietnam's IT market is growing rapidly
with a double growth rate in the 2019-23
period of about 13%, more than double
the GDP growth rate of Vietnam.
Benefit from Government policies with
strategic plans to develop the IT industry
in the country.
The global digital transformation wave
with double growth in the period 2019-22
could reach more than 16%,
The general trend of businesses is to
modernize operations to increase
efficiency and save costs, so the demand
for ERP software and services, system
6
 development for FPT. integration ... is constantly increasing due
to continuous development of technology.
Weaknesses Threats
Price competitiveness is lower than that of Fierce competition with other suppliers.
direct competitors, especially in the
telecommunications sector.
In the internet service business, FPT does Participating in import and export
not focus on expanding its market share, activities should bear the risk of exchange
but only focuses on providing services in rate differences (exchange rate difference
big cities such as Hanoi and Ho Chi Minh loss was more than 402 billion VND in
City. 2008)
The online advertising field has not had a
breakthrough, pay TV still has to suffer
losses.

Analysis of income statement and balance sheet

a) The most recent year-end balance sheet (3 consecutive years) of the
company:
2017 2018 2019 The difference
VND % VND % VND % 2017-2018 2018-2019 2017-2019
I - Total Current Assets 16,059,937,820,645 64.24% 18,406,087,226,041 61.85% 18,979,176,128,930 56.83% 14.61% 3.11% 18.18%
 1. Cash Only 3,480,659,514,788 13.92% 3,925,727,206,293 13.19% 3,453,388,617,569 10.34% 12.79% -12.03% -0.78%
 2. Short Term Investments 4,379,446,212,073 17.52% 5,568,623,727,137 18.71% 6,708,978,162,325 20.09% 27.15% 20.48% 53.19%
 3. Total Accounts Receivable 6,151,782,399,408 24.61% 6,426,946,279,074 21.60% 6,536,251,148,622 19.57% 4.47% 1.70% 6.25%
 4. Total Inventory 1,020,212,423,590 4.08% 1,340,687,216,347 4.51% 1,284,200,733,943 3.85% 31.41% -4.21% 25.88%
 5. Other Current Assets, Total 1,027,837,270,786 4.11% 1,144,102,797,190 7.74% 996,357,466,471 2.98% 11.31% -12.91% -3.06%
II -Total Long Term Assets 8,939,739,075,221 35.76% 11,350,979,923,527 38.15% 14,414,988,134,764 43.17% 26.97% 26.99% 61.25%
 1. Note Receivable - Long Term 231,657,122,488 0.93% 109,788,240,927 0.37% 262,484,590,350 0.79% -52.61% 139.08% 13.31%
 2. Fixed asset 5,247,285,021,701 20.99% 6,513,735,578,258 21.89% 7,492,167,954,088 22.44% 24.14% 15.02% 42.78%
 4. Long term unfinished asset 805,559,896,217 3.22% 1,174,778,083,753 3.95% 1,650,470,873,492 4.94% 45.83% 40.49% 104.88%
 5. Long Term Investments 1,783,369,007,284 7.13% 2,202,466,649,730 7.40% 2,496,552,054,488 7.48% 23.50% 13.35% 39.99%
 6. Other Long Term Assets, Total 871,868,027,531 3.49% 1,350,211,370,859 4.54% 2,513,312,662,346 7.53% 54.86% 86.14% 188.27%
Total Assets 24,999,676,895,866 100.00% 29,757,067,149,568 100.00% 33,394,164,263,694 100.00% 19.03% 12.22% 33.58%

I - Total Liabilities 11,761,300,662,093 47.05% 14,982,096,384,457 50.35% 16,594,874,862,688 49.69% 27.38% 10.76% 41.10%
 1. Total Current Liabilities 11,100,344,738,740 44.40% 14,451,149,990,521 48.56% 16,102,256,902,439 48.22% 30.19% 11.43% 45.06%
 2. Long-term liabilities 660,955,923,353 2.64% 530,946,393,936 1.78% 492,617,960,249 1.48% -19.67% -7.22% -25.47%
II -Total Equity 13,238,376,233,773 52.95% 14,774,970,765,111 49.65% 16,799,289,401,006 50.31% 11.61% 13.70% 26.90%
 I. Equity 13,235,626,233,773 52.94% 14,772,220,765,111 49.64% 16,796,539,401,006 50.30% 11.61% 13.70% 26.90%
2.Funding sources and other funds 2,750,000,000 0.01% 2,750,000,000 0.01% 2,750,000,000 0.01% 0.00% 0.00% 0.00%
III - BENEFITS OF MINIMUM SHAREHOLDERS 0.00% 0.00% 0.00%
Total Liabilities & Shareholders' Equity 24,999,676,895,866 100.00% 29,757,067,149,568 100.00% 33,394,164,263,694 100.00% 19.03% 12.22% 33.58%

From there we can obtain the following data

2017 2018 2019 the difference

VND % VND % VND % 2017-2018 2018-2019 2017-2019
the amount of total current assets; 16,059,937,820,645 64.24% 18,406,087,226,041 61.85% 18,979,176,128,930 56.83% 14.61% 3.11% 18.18%
the amount of total non-current assets; 8,939,739,075,221 35.76% 11,350,979,923,527 38.15% 14,414,988,134,764 43.17% 26.97% 26.99% 61.25%
the amount of total current liabilities; 11,100,344,738,740 44.40% 14,451,149,990,521 48.56% 16,102,256,902,439 48.22% 30.19% 11.43% 45.06%
the amount of total non-current liabilities 660,955,923,353 2.64% 530,946,393,936 1.78% 492,617,960,249 1.48% -19.67% -7.22% -25.47%
the amount of total stockholders' equity. 13,238,376,233,773 52.95% 14,774,970,765,111 49.65% 16,799,289,401,006 50.31% 11.61% 13.70% 26.90%

7
o Asset situation

 Through the table, we see that short-term assets tend to increase from 16,059 billion
VND in 2017 to 18,406 billion VND in 2018 (up 14.61% and accounting for 61.85%
of total assets) and continue to increase by about 3.11% in 2019. Short-term assets
increase mainly due to investments Short-term finance has a strong increase in
proportion: from 4,379 billion VND in 2017 to 6,708 billion VND in 2019 (up 53%).

 Long-term assets tended to increase significantly, from 8,939 billion VND in 2017 to
14,414 billion in 2019 (up 38% and accounted for 43.17% of total assets). The
increase in long-term assets is mainly due to the sharp increase in fixed assets: from
5,247 billion VND in 2017 to 7,492 billion VND in 2019 (up 17.5%).

 Compared to 2017, the company's total assets reached more than VND 29,000 billion
in 2018 and more than VND 33,000 billion in 2019, an increase of 33.58%.

o Liabilities & Shareholders' Equity situation

 Equity has a steady increase in proportion. Specifically: Equity in 2019 reached more
than 16,000 billion VND, an increase of more than 2,100 billion VND compared to the
previous year.
 In addition, short-term debt increased by more than 5,000 billion VND (45%).

8
  In contrast, long-term debt decreased from VND 661 billion in 2017 to VND 531
billion in 2018 (down 19.67%) but then decreased to VND 493 billion in 2019 (down
7.22% and accounting for 1.48%. in total capital)
 Fixed assets, inventories and investments in other long-term assets, in addition to
using additional equity capital, the company also borrows a large amount of short-term
debt to serve the company's operations.

 In general: total assets and total capital of the company tend to increase and FPT still
maintains a balance between Assets and Capital Resources.

b) the most recent year’s income statement (3 consecutive years) of

the company:

Column1 2019 2018 2017 2017 - 2018 2018 - 2019

Total Revenue 27,716,960.15 23,213,536.86 42,658,610.84 (19,445,073.98) 4,503,423.29
Operating Income 4,609,873.16 3,799,831.16 1,127,536.49 2,672,294.67 810,042.00
Cost of Goods sold 17,004,910.53 14,490,657.87 32,976,206.16 (18,485,548.29) 2,514,252.66
Total Operating Expenses 23,107,086.99 19,413,705.70 38,438,658.78 (19,024,953.08) 3,693,381.29
Gain (Loss) on Sale of Assets - - - - -
Net Income Before Taxes 4,664,530.51 3,857,602.56 4,255,117.78 (397,515.22) 806,927.95
Earnings per common share. 1,652.18 1,501.98 1,877.47 (375.49) 150.20
(In Million VND (Except for per share items)

o Net revenue in 2018 reached 23213536.86 million VND, decreased 45% compared to
2017, By the end of 2019, FPT's revenue reached nearly 27,792 VND billion (up
19.5% compared to 2018), Revenue structure comes from 03 business sectors
including:
 Technology
 Telecommunication
9
  Investment education.

o Revenue from financial activities in 2018 reached 3799831.16 million VND, increased
237% compared to 2017 and continued to increase 21% in 2019.

o The reason for the decline in revenue is known to be that in 2018, FPT Digital Retail
Joint Stock Company (FPT Retail) and Synnex FPT Joint Stock Company (Synnex
FPT) were no longer subsidiaries of the group. Therefore, the revenue of these two
companies is not included in the Group's revenue. Profit dropped by 8% because in
2017 the Group recorded a profit from transferring ownership of FPT Retail and
Synnex FPT.

o Operating Expenses in 2018 reached 19413705,7 million VND, decreased 49%

compared to 2017. But by the end of 2019, FPT’s total operating expenses increased
19% compared to 2019.

 In general: the company's total operating eexpenses is not stable.

Total revenue and operating income during 2017-2019

45000000

40000000

35000000

30000000

25000000

20000000

15000000

10000000

5000000

0
2017 2018 2019

Total revenue Column1

Ratio Analysis
1) Liquidity ratios
Current asset
Current ratio = Current liabilities

10
 Difference
Balance Sheet 2017 2018 2019
2017-2018 2018-2019
Current assets 16,059,938 18,406,587 18,979,176 14.61% 3.11%
Current liabilities 11,100,345 14,451,150 16,102,257 30.19% 11.43%
Current ratio 1.447 1.274 1.179 -11.96% -7.46%

o According to the table and chart above:

- The liquidity ratio of FPT Company over the years 2017, 2018 and 2019 is 1.45;
1.27; 1.17 this shows that for one dong of Current liabilities, FPT Company has
1.45; 1.27; 1.17 VND current assets ready to pay.
- This ratio of the Company decreased gradually over the years. The Company's
liquidity ratio in 2017 is 1.45 compared to 2018 is 1.27, a decrease of 12% due
to increased current assets and current liabilities, specifically in 2018 (current
assets: 18,406,587, current liabilities: 14,451,150) to 2017 (current assets:
16,059,938, current liabilities: 11,100,345).
- Similarly, the company's liquidity ratio in 2018 is 1.27 compared to 2019 is
1.17, down 7.4% due to increased current assets and current liabilities.
- Conclusion: Over the past 3 years from 2011 to 2013, FPT's current liquidity
ratio decrease, but the ratio is greater than 1, indicating that FPT's solvency is
good.

2) Efficiency Ratios

 Asset turnover Ratio

Sales
Formula: Asset turnover ratio= Total Assets

Difference
2017 2018 2019
2017-2018 2018-2019
Sales 42,658,610,841,354 23,213,536,857,725 27,716,960,152,275 -45.58% 19.40%
Total Assets 24,999,676,895,866 29,757,067,149,568 33,394,164,263,694 19.03% 12.22%
Asset turnover 1.706 0.780 0.830 -54.28% 6.40%

11
  According to the table above
o 2017: For every 1 dong invested in the company, it will generate 1.70 dong
of net revenue for the year.
o 2018: For every 1 dong invested in the company, it only generates 0.78 dong
of net revenue for the year, decreased more than 50% compared to 2017.
o 2019: For every 1 dong invested in the company, it generates 0.829 dong of
net revenue for the year, improved 6.39% compared to 2018.
 Total sales of 2018 decrease 45.58% while total assets increase by 19.02% results
in the dramatic decrease in asset turnover, the company didn’t use the investment
efficiently in this year. In the next year, there is a small improvement compared to
2018 when asset turnover ratio increase by 6.39%, but it’s still lower than 1, the
company still make a loss and couldn’t fully use the investment poured in.

 Fixed asset turnover ratio

Sales
Formula: ¿ asset turnover ratio= Total ¿ Assets ¿

Difference
2017 2018 2019
2017-2018 2018-2019
Sales 42,658,610,841,354 23,213,536,857,725 27,716,960,152,275 -45.58% 19.40%
Total Fixed Assets 5,247,285,021,701 6,513,735,578,258 7,492,167,954,088 24.14% 15.02%
Fixed asset turnover 8.130 3.564 3.699 -56.16% 3.81%

12
  According to the table above
o 2017-2018: sales decreased heavily while fixed asset increase lead to 56.16%
decrease in fixed asset turnover.
o 2018-2019: there is improvement in sales, increase by 19.39%; fixed asset
turnover is also improved. Even though it’s still not recovered back to 2017 data
but it’s shown that the company was able to use the assets more efficiently than
2018.

 Inventory turnover ratio

COGS
Formula: Inventory turnover ratio= Average Inventory

360
Days ¿ sales inventory=
inventory turnover

Difference
2017 2018 2019
2017-2018 2018-2019
COGS 32,976,206,156,753 14,490,657,872,236 17,004,910,529,153 -56.06% 17.35%
Average Inventory 2,787,010,449,770 1,180,449,819,969 1,312,443,975,145 -57.64% 11.18%
Inventory turnover 11.832 12.276 12.957 3.75% 5.55%
Day to sales inventory 30.426 29.327 27.785 -3.61% -5.26%

13
  Inventory turnover in 2018 increased by 3.74% compared to 2017, which correspond
with 1 day decrease in the number of days of inventory. It shows that the inventory
rotation of the company has been improved well.
 In 2019, while both COGS and inventory were increased, inventory turnover was also
increased and day to sales decreased by 1 day. This showed that the company has well
managed the inventory rotation and got more COGS despite getting more inventories.

 Receivable turnover ratio

Credit sales
Formula: Receivable turnover ratio= Average Account Receivable

Difference
2017 2018 2019
2017-2018 2018-2019
Sales 42,658,610,841,354 23,213,536,857,725 27,716,960,152,275 -45.58% 19.40%
Average AR 6,395,959,160,616 6,289,364,339,241 6,481,598,713,848 -1.67% 3.06%
AR turnover 6.670 3.691 4.276 -44.66% 15.86%
Collection period 53.98 97.54 84.19 80.70% -13.69%

 AR turnover decreased by 44.66% resulted in the collection period also increase by

more than 80% in 2018 compared to 2017, which indicated that the company was
getting slower in collecting debt and it might have bad credit policies. It’s improved in
2019 despite not a big difference.

3) Long-term solvency ratio

 Debt-to-asset Ratio

Total debt
Formula: Debt ¿ asset ratio= Total asset

Difference
2017 2018 2019
2017-2018 2018-2019
Total Debt 11,761,300,662,093 14,982,096,384,457 16,594,874,862,688 27.38% 10.76%
Total Assets 24,999,676,895,866 29,757,067,149,568 33,394,164,263,694 19.03% 12.22%
Debt-to-asset ratio 47.04581068 50.34802761 49.69393674 7.02% -1.30%

14
  The debt-to-total asset ratios over the years 2017, 2018 and 2019 were 47%, 50% and
49%, respectively, showing that FPT company does not depend entirely on debts, the
company is capable of self-control in terms of assets, and does not expose all risks to
the Bank.
 In 2018, the debt-to-total assets ratio increased by 7% compared to 2017 due to the
increase of 27% in total debt, a much stronger increase than the rate of asset decline
(total assets in 2018 decreased 19% compared to 2017) showing that the firm's
solvency is getting harder but still controllable. In 2019 the ratio decrease by 1.3%
compared to 2018 as total asset increase rate is higher than debt increase rate, which
show that the company’s solvency is getting better.

 Debt-to-equity Ratio

Total liabilities
Formula: Debt ¿ equity ratio= Equity
Difference
2017 2018 2019
2017-2018 2018-2019
Total Debt 11,761,300,662,093 14,982,096,384,457 16,594,874,862,688 27.38% 10.76%
Equity 13,238,376,233,773 14,774,970,765,111 16,799,289,401,006 11.61% 13.70%
Debt-to-equity ratio 88.84247172 101.4018682 98.78319533 14.14% -2.58%

 The debt-to-equity ratio of FPT in 2017, 2018 and 2019 was 88.8%, 101.4% and
98.9% respectively, indicating that for every 1 dong of equity spent, it is sponsored
0.88; 1.01; 0.98.
15
  In 2018 equity increased much slower than total debt (11.6% vs. 27.38%) which
resulted in the increase of 14% in debt-to-equity ratio. In the next year the ratio was
decreased by 2.6% as total debt increase rate is lower than equity increase rate.

 Interest coverage
EBIT
Formula: Interest coverage= Interest payment

Difference
2017 2018 2019
2017-2018 2018-2019
EBIT 4,255,117,777,507 3,857,602,555,206 4,664,530,511,706 -9.34% 20.92%
Interest payment 368,545,679,548 238,344,431,747 358,987,537,452 -35.33% 50.62%
Interest coverage 11.5456998 16.1849913 12.99357227 40.18% -19.72%

 The solvency of interest in 2018 was larger than that in 2017, an increase of 40%,
indicating that the company was able to ensure higher interest payments than in 2017
and that the company can finance the expenses by itself during business operations. In
2019 the ratio was decreased by 19.71% but it’s still at manageable range.

4) Profitability ratios

 Return on Asset

Net income
Formula: ROA= Total asset
Difference
2017 2018 2019
2017-2018 2018-2019
Net income 2,931,530,862,562 2,620,178,631,986 3,135,350,376,654 -10.62% 19.66%
Total Assets 24,999,676,895,866 29,757,067,149,568 33,394,164,263,694 19.03% 12.22%
ROA 0.117 0.088 0.094 -24.91% 6.63%

16
  The rate of return on total assets (ROA) over the years 2017, 2018 and 2019 is 0.117;
0.088 and 0.094 respectively showed that for the equivalent of property spent, they get
0.117; 0.088 and 0.094 dong profit.
 ROA was decreased by 24.91% in 2018 but then recovered to 0.0.94, which show that
the company is capable of converting its investment into profit.

 Return on Equity
Net income
Formula: ROE= Equity
Difference
2017 2018 2019
2017-2018 2018-2019
Net income 2,931,530,862,562 2,620,178,631,986 3,135,350,376,654 -10.62% 19.66%
Equity 13,238,376,233,773 14,774,970,765,111 16,799,289,401,006 11.61% 13.70%
ROE 0.221 0.177 0.187 -19.92% 5.24%

 Return on equity (ROE) over the years 2017, 2018 and 2019 is 0.221; 0.177 and 0.187
shows the equivalent of 1 dong of equity to get 0.221; 0.177 and 0.187 dong profit.
And the ROE over the past 3 years (2017 - 2019) is less than 1, proving that the
profitability of FPT is low.
 ROE in 2018 decreased by 19.92% but increased a little bit in 2019 with 5.24%. But
still cannot recover to 2017 data, which show that FPT efficiency is low.
5) Market value ratio

Price per share

Price ¿ earnings ratio=
Earning per share

17
 Difference
2017 2018 2019
2017-2018 2018-2019
Price per share 57130 42200 58320 -26.13% 38.20%
EPS 5,908 4,523 4,796 -23.44% 6.04%
P/E ratio 9.67 9.33 12.16 -3.51% 30.33%

 P/E ratio in 2018 decrease by 3.5%, both price per share and EPS also heavily
decrease more than 20% so the firm is neither getting more earnings and investors
aren’t really confident about the company. But in the next year the share price increase
sharply by 38% compared to EPS’ 6%, showing that the investor pay more money
than the earning expecting the firm’s growth in future.

Return on Invested Capital analysis:

 Return on Assets (ROA):

Net income
Return on Assets = Total assets

Change in percentage
2017 2018 2019
2018-2017 2019-2018
Net income 2,931,530,863 2,620,178,632 3,135,350,377 (10.62) 19.66
Total assets 24,999,676,896 29,757,067,150 33,394,164,264 19.03 12.22
ROA (%) 11.726 8.805 9.389 (24.91) 6.63

18
 40,000,000,000 14.00

35,000,000,000 12.00

30,000,000,000
10.00
25,000,000,000
8.00
Net income
20,000,000,000
Total assets
6.00 ROA
15,000,000,000
4.00
10,000,000,000

5,000,000,000 2.00

- 0.00
2017 2018 2019

 The rates of return on total assets (ROA) over the years 2017, 2018 and 2019 are
11.726, 8.805 and 9.389 respectively show that for every dong of assets spent, FPT
earned 11.726, 8.805 and 9.389 dong in profit.
 Return on assets (ROA) in 2018 declined sharply from 11.726 to 8.805, which is
equivalent to a 10.62% decrease, then slightly increased to 9.389 in 2019. ROA is a
profitability ratio that provides how much profit a company is able to generate from
its assets. In other words, return on assets (ROA) measures how efficient a
company's management is in generating earnings from their economic resources or
assets on their balance sheet. The chart illustrates that even with both ‘Net income’
and ‘Total assets’ increased continuously throughout the years, the ROA ratio still
decreased. The reason for this result could be the inefficient use of assets or due to
assets that were in working process that could not make a profit.
 Comparing FPT’s average ROA to the average ROA of Technology and
Telecommunication (credit: Stockbiz)
FPT Technology Telecommunication
9.973 4.2 12.84

 FPT held a sustained ROA of 9.973% over the last three years, while similar
companies within its industry averaged 4.2% and 12.84%. From this comparison,
we might assume that FPT’s management team is better than average at utilizing
company equity to generate profits (assuming the use of debt is the same across the
auto industry) in the field of Technology. On the other hand, comparing to the
Telecommunication average ROA, it can be clearly seen that operating activity of
FPT is not as efficient as similar companies within the industry.

19
  Return on equity (ROE):

Net income
Return on Assets =
Shareholder s' equity

Change in percentage
2017 2018 2019
2018-2017 2019-2018
Net income 2,931,530,863 2,620,178,632 3,135,350,377 (10.62) 19.66
Shareholders' equity 13,235,626,234 14,772,220,765 16,796,539,401 11.61 13.70
ROE (%) 22.149 17.737 18.667 (19.92) 5.24

18,000,000,000 25

16,000,000,000

20
14,000,000,000

12,000,000,000
15
10,000,000,000
Net income
Shareholders' equity
8,000,000,000
10 ROE (%)
6,000,000,000

4,000,000,000
5

2,000,000,000

- 0
2017 2018 2019

 The rates of return on equity (ROE) over the years 2017, 2018 and 2019 are
22.149, 17.737 and 18.667 respectively show that for every dong of equity spent,
FPT earned 22.149, 17.737 and 18.667 dong in profit.
 The return to equity ratio (ROE) of FPT Corporation over the past 3 years has
decreased. It went from 22.149 in 2017 to 17.737 in 2018 then had a slight increase
to 18.667 in 2019, which is equivalent to an increase of 5.24%. ROE is a
measurement of how effectively a business uses equity – or the money contributed
by its stockholders and cumulative retained profits – to produce income. In other
words, ROE indicates a company’s ability to turn equity capital into net profit. It
can be clearly seen that FPT Corporation's operating and managing activities have
decreased theirs efficiency indicates that the company may be mismanaged and
could be reinvesting earnings into unproductive assets.
 Comparing FPT’s average ROE to the average ROA of Technology and
Telecommunication (credit: Stockbiz)
FPT Technology Telecommunication
20
 19.518 9.81 21.32

 FPT held a sustained ROE of 19.518% over the last three years, while similar
companies within its industry averaged 9.81% and 21.32%. From this comparison,
we might assume that FPT’s management team is better than average at utilizing
company equity to generate profits (assuming the use of debt is the same across the
auto industry) in the field of Telecommunication. On the other hand, comparing to
the Technology average ROE, it can be clearly seen FPT is not as efficient as
similar companies within the industry.

Conclusion
 In the time frame 2017 - 2019, the most productive year was in 2017. In 2018, the
firm’s performance was the most ineffectually, partly due to the overuse of short-
term debts for operating activities leads to an increase in the total expense. As a
result, net revenue also increased although profit still decreased because of the
inefficiency in management’s use of cost.
 In 2019, the current ratio went down to 1.179 compares to 1.447 in 2017. It can be
seen that the financial position of the company has deteriorated which means the
ability to repay debts in time has also reduced.
 The accounts receivable turnover ratio increased while the collection period
decreased. This is an indication that the investment in receivables is being efficient.
 The inventories turnover increase to 12% while the day to sell inventories decrease
to 28 days. This indicated that the company is having strong sales, suggesting
greater profitability and return on investment.
 The debt-to-equity ratio in 2019 is lower than 100%, it showed that the company
could manage its debt and doesn’t rely on debt for their financing.
 Sales decreased quite dramatically from 2017 to 2018 and recovered in 2019,
similar changes also occurred in net income. The percentage gained in net income
is larger than the increase in sales. This indicated the company has good
profitability and is able to make good use of its investment.
 FPT has peaked in around 2018 and slowly calm down in 2019 as there are more
rivals in this market and the industry is getting saturated. However, FPT manage to
keep stable data and is still one of the largest company in this industry and it’s
worth investing.

Reference
 FPT Corp’s annual reports 2017
21
 FPT Corp’s annual reports 2018
 FPT Corp’s annual reports 2019
 https://s.cafef.vn/hose/FPT-cong-ty-co-phan-fpt.chn
 https://www.stockbiz.vn/IndustryOverview.aspx?
Code=2770&fbclid=IwAR0ALYg3SoT5unHdxSD2t6_JNxIbgztPB2q2yair2HtlxQD1
5YfIKKWLY9g
 https://www.stockbiz.vn/IndustryOverview.aspx?
Code=2730&fbclid=IwAR1zVegfTh1rIzlnbBH--jqeHYc0pWWJ05SRBr1EIj-
isqF2CnOIIOEvFzg

22