Vietnam Dairy Products Joint Stock Company

Balance sheet
December 31, 2020
12/31/2020 12/31/2019
vnd million vnd million
Current assets 29,632,809 24,690,283
Cash and cash equivalents 2,111,243 2,665,195
Other investments 17,313,680 12,435,744
Trade and other receivables 5,335,735 4,637,582
Inventories 4,872,151 4,951,762
Fixed assets 19,356,366 20,384,251
Trade and other receivables 423,820 435,833
Right of use assets 615,053 517,088
Other investments 286,955 298,564
Property, plant and equipment 12,866,139 13,810,973
Biological assets 1,158,775 1,121,205
Intangible assets 3,236,282 3,426,086
Investment property 59,997 62,018
Investment in equity accounted investees 686,486 688,112
Deferred tax assets 22,859 24,372
TOTAL ASSETS 48,989,175 45,074,534
 12/31/2020 12/31/2019
vnd million vnd million
LIABILITIES AND EQUITY
LIABILITIES 15,248,015 15,390,489
Current liabilities 14,209,236 14,438,986
Borrowings 7,316,497 5,351,461
Trade and other payables 6,122,029 8,222,883
Income tax payable 472,615 448,268
Other taxes payable 186,935 171,126
Advances from customers 111,160 245,248
Non-current liabilities 1,038,779 951,503
Borrowings 167 122,993
Trade and other payables 60 27,846
Lease liabilities 316 258,642
Severance allowance obligations 150 167,095
Deferred tax liabilities 346 374,927
EQUITY 33,741,160 29,684,045
Equity attributable to equity holders of the Company 31,379,697 27,456,848
Share capital 20,899,554 17,416,878
Share premium 1,883,570 1,883,570
Other capital 202,658 -
Treasury shares (11,645) (11,645)
Fair value reserve (6,450) (1,601)
Translation reserve 10,654 23,186
Other reserve 3,286,242 2,200,188
Retained earnings 5,115,114 5,946,272
Non-controlling interest 2,361,463 2,227,197
TOTAL LIABILITIES AND EQUITY 48,989,175 45,074,534
 Vietnam Dairy Products Joint Stock Company
Balance sheet
December 31, 2020
12/31/2020 12/31/2019
vnd million vnd million
Net sales 52,335,220 49,822,326
Cost of sales (32,564,525) (30,306,791)
Gross profit 19,790,695 19,515,535
Other income 61,728.000 134,005
Selling expenses (6,464,055) (6,823,427)
General and administration expenses (2,080,370) (1,610,443)
Other gains/(losses) – net 190,792 (118,622)
Results from operating activities 11,498,790 11,097,048
Finance income 1,166,557 724,228
Finance cost (158,783) (120,250)
Net finance income 1,007,774 603,978.000
Share of profit/(loss) of equity accounted investees 3.882 (5,717)
Profit before tax 12,510,446 11,695,309
Income tax (2,282,804) (2,241,378)
Net profit 10,227,642 9,453,931
II. Financial analysis
a. Liquidity ratios
Ratio Formula

1. Current ratio Current Assets/ Current Liabilities

2. Quick ratio Quick assets/ Current Liabilities

b. Asset management ratios

Ratio Formula

1. Account receivable turnover Net sales (Net credit sales) / Accounts receivable

2. Average Collection Period 365 days/ Accounts Receivable turnover ratio

3. Inventory turnover ratio Net sales/ Inventories

4. Days sales in inventory turnover ratio 365 days/ Inventory turnover ratio

5. Fixed Assets Turnover Ratio Net sales/ Net fixed asset

6. Total Asset Turnover ratio Net sales/ Total assets

c. Debt Utilization ratio

Ratio Formula

1. Total debt to total capital Total Liabilities/( Total Liabilities + Equity)

2. Long-term debt to equity Long-Term Liabilities/ (Long-Term Liabilities + Equity)

d. Profitability ratios

Ratio Formula

1. Profit margin Net Income/ Net Sales

2. Gross margin Gross Profit/ Net sales

3.Operating margin ratio EBIT/ Net sales

4. Return on total assets (ROA) Net Income/ Total assets

5. Return on equity (ROE) Net Income/ Shareholders' Equity

6. Return on Common equity (ROCE) EBIT/ Common equity

7. Basic Earning ratio (BEP) EBIT/ Total assets

2018
Inventories 5,501,458
COGS 28,600,243
 Calculation
2020 2019

2.09 1.71

1.74 1.37

Calculation
2020 2019

9.81 10.74

37 34

10.74 10.06
 34 36

2.70 2.44

1.07 1.11

Calculation
2020 2019

0.3113 0.3414

0.0299 0.0311

Calculation
2020 2019

0.1954 0.1898
0.3782 0.3917

0.2390 0.2347

0.2088 0.2097

0.4894 0.5428

0.5986 0.6715

0.2554 0.2595
 Analysis

The current ratio in 2019 and 2020 were 1.71 and 2.09 respectively, which
meant that the current ratio increased by 0.38 times compared to that in the
previous year. In other words, in 2019 100 VND of current liability was assured
by 1.71 dong of current asset whereas in 2020 it was only assured by 2.09
dong. Therefore, the ability to pay short-term obligation in 2020 was better
than in 2019. The reason is that the growth in current assets was higher than
that of the current liabilities. Vinamilk in 2020 and in 2019 can payable current
liabilities out of current assets.

With a quick ratio of higher than 1, Vinamilk appears to be well positioned to

cover its current liabilities and has liquid assets available to cover each dollar of
short-term debt. A quick ratio of 1.74 in 2020 indicates that the company
has 1.74 dong of liquid assets available to cover each 100 dong of its current
liabilities. Likewise, Vinamilk had 1.37 dong in quick assets for each VND of
current liabilitites in 2019. This ratio of 2020 is more than 2019 which proves
that Vinamilk in 2020 and in 2019 can payable current liabilities out of quick
assets.

Analysis

There is 9.81 times to company collect receivables in 2020. Meanwhile, there is

10.74 times to collect receivables in 2019. The account receivable turnover in
2020 is lower in 2019, it means Vinamilk has a poor credit recovery process
from transactions or related debts in 2020. This shows that the credit policy of
the business is not good or the customer is unable to pay the debt.

Vinamilk needs 37 days to collect receivables in a year in 2020, while in 2019

company needs 34 days to collect receivables. Because of the decreasing in
account receivable turnover in 2020, the average collection period is higher
than the 2019.

There are 10.74 times that Vinamilk company turn its inventories to sales in
2020. Meanwhile, there are 10.06 times that Vinamilk company turn its
inventories to produce in 2019. In 2020, the inventory turnover ratio of the
company (10.74) is higher than the ratio of the inventory in 2019 (10.06). The
reason is that the revenue of 2020 increased, along with the decrease in
inventory, leading to an increase in cost of goods sold. It means inventories
turnover ratio is still in a reasonable and stable level, consistent with the
inventory management policy of the company. The company does not allow
any significant slowdown in inventory.
From the calculations above, Vinamilk shows a shorter period – about 34 days
– to clear its stock in 2020. And compared with 2019 (36 days), the day sales in
inventory in 2020 is shorter than in 2019. It means the company has good
performance when it sells a lot of inventory products in 2020.

The fixed asset turnover ratio for the year is 2.7 times, meaning that for every
100 dong invested in fixed assets, a return of 2.7 dong is earned in 2020. And
the fixed asset turnover ratio for the year is 2.44 times, meaning that for every
100 dong invested in fixed assets, a return of 2.44 dong is earned in 2019.
Furthermore, fixed asset turn over in 2020 is higher than the fixed assets turn
over in 2019 (2.44), this suggests that efficiency of assets use of company as
well.

The total asset turnover ratio for the year is 1.07 times, meaning that for every
100 dong invested in total assets, a return of 1.07 dong is earned in 2020. And
the fixed asset turnover ratio for the year is 1.11 times, meaning that for every
100 dong invested in fixed assets, a return of 1.11 dong is earned in 2019.
Furthermore, total asset turn over in 2020 is lower than the total assets turn
over in 2019. It means Vinamilk uses it total asset to generate sales is not good.

Analysis

In 2020, Total liabilities accounted for 31.13% of the company's capital and in
2019, it accounted for 34.14%. It shows that the financial autonomy of
enterprises is very low. The ratio in 2020 has decreased compared to 2019,
proving that Vinamilk is reducing its dependence on the use of capital from
outside to finance short-term and long-term assets, thereby reducing the risk
to the solvency of the company.

In 2020, long-term debt accounted for 2.29% of equity and in 2019 accounted
for 3.11%. It can be seen that Vinamilk's level of long-term loan financing is
very low. The ratio in 2020 has decreased compared to 2019, thereby showing
that the company's financial risks are decreasing. Long-term debt accounts for
a very low proportion of total debt of enterprises

Analysis
In 2020, the company earned 19.54 VND million in net income from sales. In
2019, it reached 18.98 VND million. It shows that the profitability of the
business after eliminating all costs incurred in the period is very good. In 2020
the ratio has increased compared to in 2019, businesses are becoming more
and more efficient when they can generate more profit from a VND of revenue.
In 2020, each million dong generates 37.84 VND million of profit after paying
the cost of goods sold. In 2019 it is 39.17 VND million . In 2020, the gross profit
margin is lower than that of 2019, showing that the business is having
problems hindering profit potential, , the reason is that the cost Vinamilk
spends for production is quite high, reducing the profitability of business
capital.

In 2020, the company earned 23.9 VND million in operating income from sales.
In 2019, it earned 23.47 VND million . It shows that the profitability of the
enterprise after eliminating the expenses for production and business activities
incurred in the period is quite high. The higher ratio in 2020 than the previous
year shows that Vinamilk can not only expand profit margin, but also control
related operating costs effectively.

In 2020, the company earned 20.88 million dong profit after tax from its assets.
In 2019, it earned 20.97 million VND. It can be seen that profit after tax
increased very small while total assets tended to increase sharply, which led to
a decrease in ROA in 2019.

In 2020, the business earned 48.94 million dong of after-tax profit from equity.
In 2019, it earned 54.28 million vnd. The reduced ROE for 2020 means that
Vinamilk's management is making poor decisions about reinvesting capital in
non-profitable assets.

In 2020, the company earned 59.86 million dong profit from the capital used.
In 2019, it earned VND 67.15 million. The ROCE ratio in 2020 showed a sharp
decline, showing that Vinamilk is losing its advantage, the reason is that the
company uses more capital while the company's profit. Earnings have not
changed much compared to 2019.

In 2020, the business earned 25.54 million EBIT from total assets. In 2019, it
earned VND 25.95 million. The BEP ratio of the business in 2020 has decreased,
showing that the lower the underlying profitability of the asset, the lower the
business performance.
 Vietnam Dairy Products Joint Stock Company
Horizontal
December 31, 2020

Current assets
Cash and cash equivalents
Other investments
Trade and other receivables
Inventories
Fixed assets
Trade and other receivables
Right of use assets
Other investments
Property, plant and equipment
Biological assets
Intangible assets
Investment property
Investment in equity accounted investees
Deferred tax assets
TOTAL ASSETS
LIABILITIES AND EQUITY
LIABILITIES
Current liabilities
Borrowings
Trade and other payables
Income tax payable
Other taxes payable
Advances from customers
Non-current liabilities
Borrowings
Trade and other payables
Lease liabilities
Severance allowance obligations
Deferred tax liabilities
EQUITY
Equity attributable to equity holders of the Company
Share capital
Share premium
Other capital
Treasury shares
Fair value reserve
Translation reserve
Other reserve
Retained earnings
Non-controlling interest
TOTAL LIABILITIES AND EQUITY

Vietnam Dairy Products Joint Stock Company

Horizontal
December 31, 2020

Net sales
Cost of sales
Gross profit
Other income
Selling expenses
General and administration expenses
Other gains/(losses) – net
Results from operating activities
Finance income
Finance cost
Net finance income
Share of profit/(loss) of equity accounted investees
Profit before tax
Income tax
Net profit
Analyze:

1. In 2020, current assets increased by 20.02% due to an increase of 15.05% in trade and other receivables compared to 2019 re
cash and cash equivalents compared to 2019.
2. Cash and cash equivalents: In 2020 is 2,111.243 million VND, down 553,952 million VND equivalent to 20.78% compared
cash will adversely affect the company. Therefore, the company should put it in the bank to make a profit and generate more in
3. Trade and other receivables: The 2020 percentage increase is 15.05% compared to 2019, trade and other receivables indicate
company should increase the debt collection rate so that the debt is recovered faster to avoid the lack of money due to not being
4. Vinamilk's balance sheet in 2020 shows that fixed assets decreased by 5.04% or 1,207,885 while long-term liabilities increas
dong. Thus, the company has used a long-term resource to financial additional working capital.
5. Liabilities of 2019 and 2020 are 34.14% and 31.13%, respectively. The company mainly uses short-term debt, which can be
only accounted for 2.11% in 2019 and 2.12% in 2020. Liabilities decreased by 0.93% but expenses loans in 2020 increased by 3
borrowing increased 36,72% will lead to increased risk, which is really not good for the company. The company should use eq
reduce risk.
6. Equity: In the company's equity capital, the company mainly uses the owner's investment capital for reinvestment. Equity acc
64.05% in 2020, up 14.29% over last year. This helps the company reduce payment pressure and keep payment risk at a low lev
the profitability of the company. Proving this is that the profit increased only 8.18% compared to last year.
Joint Stock Company
ntal
31, 2020
12/31/2020 12/31/2019 Comparative
vnd million vnd million %
29,632,809 24,690,283 20.02%
2,111,243 2,665,195 -20.78%
17,313,680 12,435,744 39.23%
5,335,735 4,637,582 15.05%
4,872,151 4,951,762 -1.61%
19,356,366 20,384,251 -5.04%
42,382 435,833 -90.28%
615,053 517,088 18.95%
286,955 298,564 -3.89%
12,866,139 13,810,973 -6.84%
1,158,775 1,121,205 3.35%
3,236,282 3,426,086 -5.54%
59,997 62,018 -3.26%
686,486 688,112 -0.24%
22,859 24,372 -6.21%
48,989,175 45,074,534 8.68%
0%
15,248,015 15,390,489 -0.93%
14,209,236 14,438,986 -1.59%
7,316,497 5,351,461 36.72%
6,122,029 8,222,883 -25.55%
472,615 448,268 5.43%
186,935 171,126 9.24%
11,116 245,248 -95.47%
1,038,779 951,503 9.17%
167,422 122,993 36.12%
59,731 27,846 114.50%
315,844 258,642 22.12%
150,223 167,095 -10.10%
345,559 374,927 -7.83%
33,741,160 29,684,045 13.67%
31,379,697 27,456,848 14.29%
20,899,554 17,416,878 20.00%
1,883,570 1,883,570 0%
202,658 0 0%
-11,645 -11,645 0%
-6,450 -1,601 302.87%
10,654 23,186 -54.05%
3,286,242 2,200,188 49.36%
5,115,114 5,946,272 -13.98%
 2,361,463 2,227,197 6.03%
48,989,175 45,074,534 8.68%

Joint Stock Company

31, 2020
12/31/2020 12/31/2019 Comparative
vnd million vnd million %
52,355,220 49,822,326 5.08%
-32,564,525 -30,306,791 7.45%
19,790,695 19,515,535 1.41%
6,173 13,401 -53.94%
-6,464,055 -6,823,427 -5.27%
-2,080,370 -1,610,443 29.18%
19,079 -11,862 -260.84%
11,498,790 11,097,048 3.62%
1,166,557 72,423 1510.75%
-15,878 -12,025 32.04%
1,007,774 60,398 1568.56%
3,882 -5,717 -167.90%
12,510,446 11,695,309 6.97%
-2,282,804 -2,241,378 1.85%
10,227,642 9,453,931 8.18%

de and other receivables compared to 2019 resulting in a 20.78% decrease in

illion VND equivalent to 20.78% compared to 2019. Reducing too much

e bank to make a profit and generate more income for the company.
to 2019, trade and other receivables indicates an increase in debt, the
r to avoid the lack of money due to not being able to collect the debt.
1,207,885 while long-term liabilities increased by 9.77% or 87.276 billion
king capital.
y mainly uses short-term debt, which can be seen clearly when long-term debt
3% but expenses loans in 2020 increased by 36.72% compared to 2019. The
or the company. The company should use equity more than borrowing to

vestment capital for reinvestment. Equity accounted for 60.91% in 2019 and
t pressure and keep payment risk at a low level. However, this also reduces
% compared to last year.
 Vietnam Dairy Products Joint Stock Company
Vertical
31-Dec-20
12/31/2020 12/31/2019 12/31/2020
vnd million vnd million %
Net sales 52,355,220 49,822,326 100%
Cost of sales 32,564,525 30,306,791 62.20%
Gross profit 19,790,695 19,515,535 37.80%
Other income 6,173 13,401 0.01%
Selling expenses 6,464,055 6,823,427 12.35%
General and administration expenses 2,080,370 1,610,443 3.97%
Other gains/(losses) – net 19,079 11,862 0.04%
Results from operating activities 11,498,790 11,097,048 21.96%
Finance income 1,166,557 72,423 2.23%
Finance cost 15,878 12,025 0.03%
Net finance income 1,007,774 60,398 1.92%
Share of profit/(loss) of equity accounted investees 3,882 5,717 0.01%
Profit before tax 12,510,446 11,695,309 23.90%
Income tax 2,282,804 2,241,378 4.36%
Net profit 10,227,642 9,453,931 19.54%

Analyze
As can be seen , Vinamilk has a significant rise in net sales by 4 thousand billion VND from 2019
to 2020. Operating income of Vinamilk is always excellent. More particularly, in 2020 operating
income of Vinamilk is almost 12 thousand billion VND which was uplifted by 23.9% of net sales
higher than that number in 2019. In addition, financial income and other income made up 2,23 %
of net sales in 2020 is higher than in 2019 (0,15%), especially the percentage of other income
lower from 0,03 % in 2019 to 0,01% in 2020. These numbers show that Vinamilk's revenue is
mostly on dairy industry. The table data also gives information on the percentage of cost of goods
sold divided net sales from 2019 to 2020. This percentage of COGS (62.2%) in 2020 is higher
than the COGS in the 2019 (60,83%). That's why Gross profit in 2020 (37.8%) is lower than in
2019 (39.17%). Vinamilk has invested its money in new automatic systems which applied on
manufacture is one of the most reasons made ratio of COGS increase. In addition, the percentage
of COGS increased also made the net profit of Vinamilk climb. More particularly, the net profit
after tax of net sales in 2020 (19.54%) is higher than 2019 (18.8%).
y Vietnam Dairy Products Joint Stock Company
Vertical
31-Dec-20
12/31/2019 12/31/2020
% vnd million
100% Current assets 29,632,809
60.83% Cash and cash equivalents 2,111,243
39.17% Other investments 17,313,680
0.03% Trade and other receivables 5,335,735
13.70% Inventories 4,872,151
3.23% Fixed assets 19,356,366
0.02% Trade and other receivables 42,382
22.27% Right of use assets 615,053
0.15% Other investments 286,955
0.02% Property, plant and equipment 12,866,139
0.12% Biological assets 1,158,775
0.01% Intangible assets 3,236,282
23.47% Investment property 59,997
4.50% Investment in equity accounted investees 686,486
18.98% Deferred tax assets 22,859
TOTAL ASSETS 48,989,175
LIABILITIES AND EQUITY
illion VND from 2019 LIABILITIES 15,248,015
ly, in 2020 operating Current liabilities 14,209,236
by 23.9% of net sales Borrowings 7,316,497
ome made up 2,23 % Trade and other payables 6,122,029
e of other income Income tax payable 472,615
amilk's revenue is Other taxes payable 186,935
ntage of cost of goods
Advances from customers 11,116
) in 2020 is higher
Non-current liabilities 1,038,779
%) is lower than in
which applied on Borrowings 167,422
dition, the percentage Trade and other payables 59,731
ularly, the net profit Lease liabilities 315,844
Severance allowance obligations 150,223
Deferred tax liabilities 345,559
EQUITY 33,741,160
Equity attributable to equity holders of the Company 31,379,697
Share capital 20,899,554
Share premium 1,883,570
Other capital 202,658
Treasury shares 11,645
Fair value reserve 6,540
Translation reserve 10,654
Other reserve 3,286,242
Retained earnings 5,115,114
Non-controlling interest 2,361,463
TOTAL LIABILITIES AND EQUITY 48,989,175
oint Stock Company
l
20
12/31/2019 12/31/2020 12/31/2019
vnd million % %
24,690,283 60.49% 54.78%
2,665,195 4.31% 5.91%
12,435,744 35.34% 27.59%
4,637,582 10.89% 10.29%
4,951,762 9.95% 10.99%
20,384,251 39.51% 45.22%
435,833 0.09% 0.97%
517,088 1.26% 1.15%
298,564 0.59% 0.66%
13,810,973 26.26% 30.64%
1,121,205 2.37% 2.49%
3,426,086 6.61% 7.60%
62,018 0.12% 0.14%
688,112 1.40% 1.53%
24,372 0.05% 0.05%
45,074,534 100% 100%

15,390,489 31.13% 34.14%

14,438,986 29.00% 32.03%
5,351,461 14.93% 11.87%
8,222,883 12.50% 18.24%
448,268 0.96% 0.99%
171,126 0.38% 0.38%
245,248 0.02% 0.54%
951,503 2.12% 2.11%
122,993 0.34% 0.27%
27,846 0.12% 0.06%
258,642 0.64% 0.57%
167,095 0.31% 0.37%
374,927 0.71% 0.83%
29,684,045 68.87% 65.86%
27,456,848 64.05% 60.91%
17,416,878 42.66% 38.64%
1,883,570 3.84% 4.18%
0 0.41% 0.00%
11,645 0.02% 0.03%
1,601 0.01% 0.00%
 23,186 0.02% 0.05%
2,200,188 6.71% 4.88%
5,946,272 10.44% 13.19%
2,227,197 4.82% 4.94%
45,074,534 100.00% 100.00%
 RECOMMENDATION

ASSETS: LIABILITIES EQUITY

Through the data in the table over the The average liabilities ratio In the company's
years 2019 and 2020, we see that the of the company is about capital structure in
proportion of current assets is larger 32.63%, which is neither 2019 and 2020, the
than the proportion of long-term low nor high for the proportion of equity is
assets. . On average, the proportion of company. Of the total about 67.36%. High
assets accounts for 57.63% of total liabilities, the majority is equity ratio while
assets. This is because the company current liabilities, which will medium debt ratio
mainly imports raw materials from help the company incur less helps the company
abroad rather than producing materials cost of use than long-term grow more sustainably
domestically. Although the proportion liabilities. However, and face less payment
of long-term assets increased from payment pressure as well as risks. However, a high
2019 to 2020 was 5.71% and the higher financial risks will proportion of equity
proportion of fixed assets decreased by also affect the company's may affect the
5.71%. According to the assessment, profitability. Therefore, the profitability of the
the proportion of short-term and long- company should readjust company, so the
term assets does not differ too much, and use long-term liabilities company needs to
the reason is that the Company cannot more rationally. consider to adjust this
completely produce all stages. So it is proportion
reasonable to have such a difference. accordingly.
ENDATION
SOLVENCY
In general, the company's solvency
ratios are greater than 1, which shows
that $1 of short-term liabilities is
secured by more than $1 of current
assets. The company's quick ration is
at a good level with 1.37 in 2019 and
1.74 in 2020, proving that the
company can afford to pay short-term
liabilities without selling inventory.
The company's liquidity risk can be
assessed as low. In general, it can be
seen that the company is doing very
well in debt collection, if the liabilities
collection is not good, it can lead to
insolvency. Therefore, the company
needs to maintain the indicators and
have management solutions to
optimize it further.
ASSET
MANAGEMENT
CAPABILITIES
Inventory management ability:
The company's inventory turn
around time is short but tends
to increase from 2019 to 2020
specifically from 5.64 to 6.4,
up 0.76 due to the increase in
the value of raw materials.
Materials is greater than the
growth rate of cost of goods
sold, which proves ineffective
inventory management and
sales policies leading to waste
of capital, reducing the
company's profitability. The
company needs to focus on
determining the level of
demand to make more
reasonable reserves.