TRANSFORM TO SUCCEED ANNUAL REPORT ANNUAL REPORT 2013

Transcription

1 TRANSFORM TO SUCCEED VINGROUP JOINT STOCK COMPANY No. 7, Bang Lang 1, Vinhomes Riverside, Viet Hung Ward, Long Bien District, Ha Noi, Vietnam Tel: +84 (4) Fax: +84 (4) Website: REPORT 2013

2 KEY FIGURES FOR 2013 TABLE OF CONTENTS 75,773 ASSETS VND BILLION 62,594 MARKET CAPITALISATION VND BILLION CORPORATE PROFILE Vision, Missions and Core Values Corporate Milestones Message from the Chairman of the Board of Management Businesses Organisational Structure Board of Management Supervisory Committee Board of Directors OPERATIONS IN ,378 NET REVENUE VND BILLION 9,740 PROFIT BEFORE TAX VND BILLION Financial Summary Report from the Board of Management Report from the Board of Directors 10 Operational Highlights Shareholder and Investor Relations Shareholder Information CORPORATE GOVERNANCE Corporate Governance Risk Management Business Strategy 60 18,617 VND BILLION 7,896 EARNING PER SHARE VND/SHARE SUSTAINABLE DEVELOPMENT Corporate Culture Human Resource Social Responsibilities Research and Development CONSOLIDATED FINANCIAL STATEMENTS VAS Consolidated Financial Statements Summary of IFRS Consolidated Financial Statements Reconciliation between VAS and IFRS Consolidated Income Statement 02 BÁO CÁO THƯỜNG NIÊN

3 CORPORATE PROFILE Vingroup Joint Stock Company ( Vingroup or the Group ) is one of the largest listed companies by market capitalisation in Vietnam. Vingroup emphasises longterm sustainable development targeting quality real estate and hospitality via two key brands, Vincom and Vinpearl. shopping malls, office and apartment complexes in major cities. Vincom is leading the trend towards smart, urban ecoluxury townships in Vietnam. Vinpearl is the largest and most wellrecognised Vietnamese hospitality and tourism brand featuring 5star and above hotels and resorts, beachfront villas, amusement parks, and golf courses. In January 2012, Vinpearl JSC merged into Vincom JSC to form Vingroup Joint Stock Company. The Group has developed a diverse brand portfolio that includes: Vincom Center and Vincom Mega Mall (quality shopping centres). Vinhomes (quality residential development). Vinpearl (premium resorts and hotels). Vinpearl Land (amusement parks). Vinmec (quality healthcare). Vinschool (quality education). VinEcom (comprehensive ecommerce). Vingroup continues to pioneer and lead consumer trends in all its businesses through offering quality products and introducing a modern lifestyle experience to Vietnamese consumers. The Group is proud to carry the mantle as a leading private enterprise in Vietnam, built by Vietnamese people and honouring Vietnamese intelligence, spirit and aspiration. Vingroup is wellrecognised for successfully combining sustainable and dynamic development in Vietnam with regional and international capabilities.

4 VISION, MISSIONS, CORE VALUES VISION LOGO CORE VALUES 06 True to its pioneering ambition, sustainable development investment strategies, Vingroup aims to consolidate and extend its lead in the private multisector business segment in Vietnam and the region, and to establish itself as an international brand. Vingroup also aspires to create a brand that represents MISSIONS Market: To provide unique, creative, premium products and services of outstanding quality that meet international standards, exceed customer expectations while reflecting local tastes and upholding Vietnamese cultural values. Shareholders and Partners: To align our interests via cooperative development and commit to creating realisable value in the longterm for our partners and shareholders. Employees: To build a professional, creative, dynamic, and humane work environment, providing all employees equal opportunities for career advancement. Society: To demonstrate corporate social responsibility and national pride by harmonising corporate benefits with community contributions. shows a bird flying towards the sun, representing our strong desire to reach new heights and our determination to achieve great success. are in the shape of the letter V to stand victory a goal that Vingroup continuously strives to achieve. standard criteria and principles. Vietnamese identity, spirit and intelligence. SLOGAN Vingroup is where talented people meet and work towards the common goals of success and social development. their specific fields. given opportunities and placed in the most favourable conditions to maximise their individual talents. CREDIBILITY INTEGRITY CREATIVITY SPEED Vingroup vigorously protects its Credibility as prepared to execute and spares no effort towards meeting its goals. Vingroup considers Integrity a foundation of its business. We strictly comply with the law and maintain the highest level of professional and social ethics. Customercentrism is also a core value. We highly value creativity as leverage in our development, and uphold the spirit dare to think, dare to do, aimed at building an organisation eager to learn. Vingroup considers speed and efficiency in every activity as a guiding principle. We practice fast decision fast investment fast deployment fast sales fast change and quick adaptation. The Group operates under the principle Best Society. Vingroup develops the human spirit while valuing employees as our most valuable asset, creating the basis for fairness, integrity, unity and power. 07

5 CORPORATE MILESTONES 08 Vingroup Joint Stock Company (JSC) was established after the merger of two companies: Vincom JSC and Vinpearl JSC in January Vinpearl JSC, formerly known as Hon Tre Tourism and Trading Investment and Development Limited Liability Company, was established on 25 July 2001 in Nha Trang, Khanh Hoa province, and is primarily engaged in the resort, tourism, hospitality and recreation sectors. The destinations throughout Vietnam such as Khanh Hoa Vincom JSC, formerly known as the Vietnam General Commercial JSC, was founded in Hanoi on 3 May Its operations mainly involve real estate development, sales and management including shopping malls, offices, and highend luxury apartments and villas. The company has developed largescale complexes such as Vincom Center Ba Trieu, Vincom Center Long Bien, Vincom Center Dong Khoi, Royal City, Times City and Vinhomes Riverside. Vingroup focuses on growing its core brands, including: Vincom Center and Vincom Mega Mall (upscale shopping centres), Vinhomes (highend apartments and villas), Vinpearl (tourism and hospitality properties) and Vinpearl Land (recreational services). Vingroup continues to expand and develop into other sectors such as Vinmec (high quality healthcare services), Vinschool (high quality education services), VinEcom (ecommerce), Kids World (children superstore of products and services), and VinKE (edutainment zone for children)

6 July 2001 May Hon Tre Tourism and Trading Limited Liability Company (formerly Vinpearl JSC) was established in the coastal city of Nha Trang, Khanh Hoa province. was the 5star Vinpearl Resort Nha Trang. Vietnam General Commercial JSC (formerly Vincom JSC) was founded with an initial charter capital of VND196 billion to develop an international standard shopping mall and office complex at 191 Ba Trieu Street, Hai Ba Trung district, Hanoi (Vincom Center Ba Trieu Towers A and B). The 225room, 5star Vinpearl Resort Nha Trang on Hon Tre Island was opened Vincom Center Ba Trieu was launched introducing the modern shopping experience and culture in the capital. Vinpearl Land was opened, turning arid Hon Tre Island into a luxury tourist destination a symbol of the rapid growth of tourism in Nha Trang Khanh Hoa in particular and Vietnam in general. The Company successfully organised and hosted the Miss Vietnam 2006 at Vinpearl Land. MILESTONES 10 March 2007 The 3,320 metre long Vinpearl was launched. The year also saw the opening of the deluxe building of Vinpearl Resort Nha Trang, raising the total number of 5star guest rooms to 485. In addition, Vingroup successfully organised the first Miss Vietnam World at Vinpearl Land Nha Trang, thus establishing its reputation as the island for beauty contests and events July 2007 Vingroup officially listed its shares on the Ho Chi Minh City Stock Exchange under the ticker VIC. 11 Fourth quarter 2009 August 2009 The official opening of the retail component of Vincom Center Ba Trieu Tower C reaffirmed Vincom Center Ba Trieu as one shopping centres. The construction and handover of luxury apartments at Vincom Center Ba Trieu. Vingroup became the first Vietnamese company to successfully issue USD100 million of convertible bonds on the Singapore Exchange (SGX). April 2010 The luxurious, contemporary office and shopping mall complex Vincom Center Dong Khoi, Ho Chi Minh City opened Vingroup successfully hosted the second Miss Vietnam World and Miss Earth at Vinpearl Nha Trang. March 2011 Vingroup introduced the Vincom Center and Vincom Mega Mall chains of large and quality shopping malls in Vietnam, which will be built in major cities across the country. 28 May 2011 The 5star Superior Vinpearl first island golf course Vinpearl Golf Club Nha Trang were opened simultaneously, marking the completion of all project components and amenities of Vinpearl Land Nha Trang that had been in development and operation for over a decade.

7 MILESTONES 3 July star Superior Vinpearl Luxury Da Nang was opened. The extraordinary General the merger of Vinpearl JSC into Vincom JSC to form Vingroup JSC. Vincom Center Long Bien was inaugurated at Vinhomes Riverside. At the same time, Vingroup relocated its Head Office to the Vinhomes Riverside urban ecocomplex, located in Long Bien district, Hanoi. January January 2012 April July 2012 The merger with Vinpearl JSC raised total charter capital to approximately VND5,500 billion and a development strategy was approved to focus on four strategic brands, namely: Vincom (real estate), Vinpearl (tourism and recreation), Vinmec (high quality healthcare services) and Vincharm (fitness and beauty care services), operating under the new entity: Vingroup JSC. Vingroup officially launched Vinmec brand and put into operation Vinmec International Hospital, internationalstandard hospital. A successful issuance of USD300 million of international convertible bonds listed on the Singapore Exchange. FinanceAsia recognised this as the Best Vietnam Deal Vincom Center A Ho Chi Minh City a luxury retail, food and beverage complex was opened. Vingroup was honoured as Best Developer Vietnam and Vinhomes Riverside was honoured with Best Villa Development Vietnam at the Southeast Asia pore. April 2013 Vingroup officially joined the Vietnamese education market with the Vinschool brand a system from kindergarten to high school. May July 2013 Vincom Mega Mall Royal City, Asia's largest underground entertainment complex, opened. Vingroup launched its new brand, Vinhomes, marking an important step in developing luxury apartments and villas with highend standards services. Vincom Mega Mall Times City, new Vinschool facilities, and Vinmec International Clinic at Times City opened. January 2013 Vingroup became a founding member of the World Economic Forum (WEF). A consortium led by Warburg equity firm focused on growth investing, invested USD200 million in a strategic partnership with Vincom Retail, a subsidiary of Vingroup, to substantially expand business. Acquisition International recognised this as "Real Estate Deal of the Year Vingroup launched VinKC (now Kids World) a network of shops, educational and healthcare services for children. Vingroup officially joined the retail market. Vingroup successfully issued a USD200 million international bond. FinanceAsia named this transaction Best Vietnam Deal 2013, whilst IFRS Asia called it Vietnam Capital Markets Deal of the Year January Vingroup handed over thousands of apartments at Vinhomes Royal City and Vinhomes Times City.

8 MESSAGE FROM THE CHAIRMAN OF THE BOARD OF MANAGEMENT 14 Dear Valued Shareholders, On behalf of the Board of Management (BOM) and Board of Directors (BOD), I would like to extend our warmest greetings and wish you good health, happiness and success! Ladies and Gentlemen! 2013 continued to be challenging for the economy in general and for the real estate business in particular. However, with leadership, aspiration and a sustainable development strategy, Vingroup has maintained its position as one of powerful enterprise in the region and globally. With the determination of the entire staff and the support of shareholders, Vingroup had an outstanding year of operational and business success. We not only demonstrated strong internal capacity to sustain growth but also continued to expand into new areas with many impressive achievements. In the property sector, Vingroup continued to strengthen its position as the number one provider of marketfirst products to the market. In 2013, the Group successfully completed the Vingroup created significant buzz in the market and attracted many new customers after handing over onschedule thousands of apartments to customers and opening the two shopping malls under the brand Vincom Mega Mall with a total area of 400,000m 2. Underscoring our belief that product and service qualities are fundamental to sustainable development, in 2013 Vingroup continued to invest, upgraded the infrastructure system of its urban areas and added new facilities for residents. It also launched Vinhomes a residential product with premium services aimed at introducing a new level of lifestyle to Vietnam. In the tourism and hospitality sector, besides promoting its inherent strengths, Vinpearl takes pride in its performance in 2013 as it started construction on a number of important hospitality and tourism projects at major travel destinations attractive options to the holiday paradise portfolio of hotels, resorts and beach villas under the name Vinpearl. Besides the core areas of real estate and tourism, 2013 also fields: health, education, highend residential services, retail quality clinics in Royal City and Times City, the launch and rapid development of Vinschool, the introduction of Vinhomes apartments and luxury villas, the opening of a retail chain specialised for children Kids World, and the debut of an educational and entertainment area for children VinKE have showcased the scale, class, and dynamic abilities of Vingroup. In early 2014, to prepare for the new consumer trends seen in developed countries, the Group established VinEcom Company to officially enter the field of ecommerce. Already the largest owner and operators of physical shopping centres in Vietnam, the Group will further consolidate its position in the retail sector both on and offline when VinEcom begins operations. VinEcom aims to differentiate itself by leveraging unequalled shopping experience for online consumers. Vingroup maintained its position as a Top 5 company on the Vietnamese stock market, with one of the largest market capitalisations on the exchange. VIC accounts for a large Vingroup continued its successful track record of international fund raising to meet longterm objectives. Vingroup also underwent a Vingroup Transformation project to decentralise its operational model into management by has been well established by the best international corporations as superior to a centralised model. Ongoing training will aim to create a professional, effective and sustainable work culture to set a solid foundation to serve the Thanks to strong determination on all fronts, in 2013 Vingroup achieved record revenues and profits. Specifically, net revenue reached VND18,378 billion and profit after tax reached VND7,149 billion, representing an increase of 132.5% and 287%, respectively, compared to the same period last year. This created a strong momentum for sustainable growth in 2014 and beyond. It is certain that through our extensive experience, effort, determination and emphasis on the core values, the devoted Vingroup staff have guided the firm consistently toward its development goals. Their achievements represent the industriousness and creativity of the staff, the flexibility and business acumen of management, and our outstanding reputation and position in the market. Vingroup truly deserves its slogan: Vingroup Where the best gather and grow. Dear Valued Shareholders, 2014 is a pivotal year for Vingroup with the task of developing new business areas while maintaining growth and momentum in traditional sectors. With that in mind, the major focus this year is on leveraging all resources to execute inprogress projects ontime and efficiently utilising existing and operating facilities and projects. Vingroup will continue to emphasise on the implementation of measures in the following areas: strategic planning, new technology solutions, human resources, risk management, market share and customer and investor confidence. We will continue to promote the core values of CREDIBILITY, and further our position as one of the leading economic groups in Vietnam, and eventually the region. On behalf of the Board of Management I would like to express our gratitude to you for your trust, support and partnership. We believe that through our highly adaptable, sustainable development strategy we can achieve our goals for 2014 and development to a new level while protecting the longterm interests of our shareholders and make an even greater contribution to the society and culture of Vietnam. Sincerely yours, Pham Nhat Vuong 15

9 16 BUSINESSES With charter capital of approximately VND9.3 trillion and market capitalisation of nearly VND63 trillion (as of 31 December 2013), Vingroup is one of the leading economic groups in Vietnam. It owns controlling interests in many largescale real estate projects in major cities and popular tourism destinations across the country. Vingroup is now focused on the development of its strategic brands: Vincom Center and Vincom Mega Mall (quality shopping centres), Vinhomes (quality apartment and villa services), Vinpearl (hospitality and tourism properties), Vinpearl Land (recreational services). Besides core business areas, Vingroup continues to expand and develop in other segments such as Vinmec (high quality healthcare services), Vinschool (high quality education services), VinEcom (ecommerce), Kids World (children superstore of products and services), and VinKE (edutainment zone for children) BÁO CÁO THƯỜNG NIÊN 17 BÁO CÁO THƯỜNG NIÊN

10 18 Owning, managing and operating some of the largest landmark shopping malls in Vietnam, Vincom Retail is leading consumer worldclass shopping malls of under 100,000m 2 in GFA and Vincom Mega Malls, large allinone centres of over 100,000m 2 in GFA that provide customers with a highquality retail, entertainment and dining experience. The shopping centres include: Vincom Center Ba Trieu Vincom Center Long Bien Vincom Center Dong Khoi Vincom Mega Mall Royal City Vincom Mega Mall Times City Vinhomes, a brand launched in November 2013, is targeted An ideal combination of quality residential properties and uncompromising services, Vinhomes will be a breakthrough in terms of quality in the highend property segment in Vietnam, taking premium living in Vietnam to the next level. Vinhomes properties include: Vinhomes Dong Khoi Vinhomes Riverside Vinhomes Royal City Vinhomes Times City (Apartments Vincom Center Ba Trieu) After more than a decade of development, Vinpearl is deservedly a leader in in Vietnam tourism with a sizeable portfolio of hotels and resorts wellknown for their luxurious style, unique features and firstclass service. Vinpearl hotels and resorts fall into two categories: Vinpearl Resort (5star) and Vinpearl Luxury (5star Superior). It is expected that in the next 35 years the Group will develop 10 hotel complexes and entertainment services under its purview. Vinpearl properties include: Vinpearl Resort Nha Trang Vinpearl Luxury Nha Trang Vinpearl Luxury Da Nang Vinpearl Golf Club Nha Trang Vincom office buildings are located in major financial and economic centres and are designed to maximise natural light, save energy and create a modern, professional and efficient working environment. The properties have been selected as the headquarters of financial institutions and embassies and also home to several Vietnamese and foreign organisations and companies. Vincom Office properties include: Vincom Center Dong Khoi (longterm leased to Vicentra in 2013) Royal City Times City 19 community. The brand has been in operation for two years, with an international hospital under the same name (located at 458 Minh Khai, Hanoi), and international standard clinics in both Royal City and Times City. With highly experienced, professional and qualified physicians, pharmacists and nurses, Vinmec is committed to providing international quality health services and contributing to an improved quality of life for a more civilised and modern Vietnam. Vinmec system includes: Vinmec Research Institute Vinmec International Hospital, Times City Vinmec International Clinic, Royal City Vinmec International Clinic, Times City Vinmec Stem Cell and Gene Technology Center 2013 as a highquality multilevel education institution serving students from kindergarten to high school. It strives to improve the community and contribute to the improvement of Vinschool provides quality K12 education at reasonable cost. Vietnamese approved curriculum is combined with foreign language and life skill classes to provide a comprehensive, modern education. Vinschool premises are available in Vingroup urban areas nationwide. Vinschool premises include: Vinschool at Vinhomes Riverside Vinschool at Royal City Vinschool at Times City services and amusement park system. Located in, Vinpearl Land has the same high quality of other regional and global recreational theme parks. Vinpearl Land facilities include: Vinpearl Land Nha Trang Vinpearl Water Park Royal City Vinpearl Ice Rink Royal City Vinpearl Games Royal City Royal Bowling Vinpearl Aquarium Times City VinKE Times City 2014, marking the entry of Vingroup in ecommerce. With sector, VinEcom was a strategic step to proactively capture contemporary consumption trends in Vietnam in anticipation that Vietnam will follow similar trends elsewhere in the world. VinEcom aims to differentiate itself with attentive services bringing a 5star online shopping experience to Vietnam.

11 ORGANISATIONAL STRUCTURE GENERAL SHAREHOLDERS MEETING BOARD OF MANAGEMENT CHAIRMAN PHAM NHAT VUONG SUPERVISORY COMMITTEE COUNCILS GENERAL DIRECTOR DUONG THI MAI HOA 1 SPECIALISED COMMITTEES 20 VINCOM RETAIL JOINT STOCK COMPANY VINHOMES REAL ESTATE TRADING & MANAGEMENT LIMITED LIABILITY COMPANY VINCOM OFFICE LIMITED LIABILITY VINPEARL JOINT STOCK COMPANY VINPEARLLAND LIMITED LIABILITY COMPANY VINMEC INTERNATIONAL GENERAL HOSPITAL JOINT STOCK COMPANY VINSCHOOL ONE MEMBER COMPANY LIMITED VINECOM LIMITED LIABILITY COMPANY 2 VINCOM CONSTRUCTION LIMITED LIABILITY COMPANY VINCOM SECURITY SERVICE COMPANY LIMITED OTHER PROJECT AND AFFILIATE COMPANIES FINANCE DEPARTMENT FOREIGN TRADE M&A DEPARTMENT LEGAL DEPARTMENT 21 VINCOM CENTER BA TRIEU APARTMENTS VINCOM CENTER BA TRIEU VINCOM OFFICE DONG KHOI VINPEARL RESORT NHA TRANG VINPEARLLAND NHA TRANG VINMEC RESEARCH INSTITUTE VINSCHOOL KINDERGARTEN SYSTEM RISK MANAGEMENT DEPARTMENT TRAINING DEPARTMENT VINCOM CENTER DONG KHOI VINCOM CENTER LONG BIEN VINCOM MEGAL MALL ROYAL CITY VINCOM MEGA MALL TIMES CITY VINHOMES DONG KHOI VINHOMES RIVERSIDE VINHOMES ROYAL CITY VINHOMES TIMES CITY VINCOM OFFICE ROYAL CITY VINCOM OFFICE TIMES CITY VINPEARL LUXURY NHA TRANG VINPEARL GOLF CLUB VINPEARL LUXURY DA NANG VINPEARLLAND HA NOI VINMEC INTERNATIONAL HOSPITAL VINMEC INTERNATIONAL CLINIC VINMEC STEM CELL AND GENE TECHNOLOGY CENTER VINSHOOL MULTI LEVEL EDUCATION SYSTEM ORGANISATION AND PERSONNEL DEPARTMENT DEPARTMENT OF PUBLIC RELATIONS SHAREHOLDER AND INVESTOR RELATIONS DEPARTMENT TECHNICAL DEPARTMENT INSPECTION DEPARTMENT 1 Ms. Duong Thi Mai Hoa was appointed the Group s General Director as of 11 February Ms. Le Thi Thu Thuy was the Group s General Director and Ms. Hoa s predecessor from 14 June 2012 to 11 February VinEcom Limited Liability was established on 19 February 2014.

12 22 23 BOARD OF MANAGEMENT SUPERVISORY COMMITTEE The Board of Management (BOM) is appointed at the GSM and entrusted with the full power to exercise all rights and relegated to the authority of the GSM. The BOM comprises eleven members with the following rights and duties: Deciding the Group's development and business plans and finalising the annual budget. Establishing operational goals pursuant to the strategic goals approved by the GSM. Reporting to the GSM on the Group's business performance, planned dividends, financial statements, business strategies and general business conditions. Developing the Group's organisational structure and operational rules. Other rights and duties in accordance with statutory GSM. MEMBERS OF THE BOM Ms. Le Thi Thu Thuy Vice Chairwoman of the BOM 5. Ms. Nguyen Dieu Linh Vice Chairwoman of the BOM 6. Ms. Vu Tuyet Hang Vice Chairwoman of the BOM 7. Mr. Le Khac Hiep Vice Chairman of the BOM 8. Ms. Mai Huong Noi Member of the BOM 9. Mr. Ling Chung Yee Roy Member of the BOM 10. Mr. Marc Villiers Townsend Member of the BOM 11. Mr. Joseph Raymond Gagnon Member of the BOM GSM. The SC has five members with fiveyear terms. Key tasks of the SC include: Monitoring BOM and BOD manangement and administration practices. Inspecting the validity, legality, transparency, corporate governance and prudence of business operations, important business transactions, accounting and statistical practices, as well as financial reporting. Evaluating the business report, annual and semiannual Financial Statements of the Group, reporting on evaluations by the BOM and submitting the evaluation report of the above issues to the GSM at the Annual General Shareholders Meeting. Conducting other rights and obligations of the SC as described in law, the Group Charter and resolutions of the GSM. MEMBERS OF THE SC 1. Mr. Nguyen The Anh Head of the SC 2. Mr. Dinh Ngoc Lan Member of the SC 3. Ms. Nguyen Thi Van Trinh Member of the SC 4. Ms. Do Thi Hong Van Member of the SC 5. Ms. Hoang Thuy Mai Member of the SC

13 He has a long track record as an entrepreneur both inside and outside Vietnam, reflected in his real estate) and Vinpearl (the leading brand in tourism, hospitality and recreation). Geological Economic Engineering from Moscow Geology University in Russia in position in ship and influence. 25 Mr. PHAM NHAT VUONG 28 BÁO CÁO THƯỜNG NIÊN

14 BOARD OF DIRECTORS 26 GENERAL DIRECTOR MS. DUONG THI MAI HOA Ms. Duong Thi Mai Hoa was appointed General Director as of 11 February Before joining the Group, she held senior leadership positions at multinational corporations and commercial banks in Vietnam where she acquired a deep experience in finance and banking. Specifically, she was Corporate Banking General Director at Maritime Bank, General Director of Vietnam International Bank (VIB), Deputy General Director and Head of Retail Banking of VIB, CFO of VIB, CFO of Oracle opera 27 The Board of Directors (BOD) is appointed and dissolved by the BOM. As of 31 December 2013, the BOD consisted of a General Director, five Deputy General Directors and one Chief Accountant. The Deputy General Directors support the General Director by fulfilling the tasks entrusted to them. The Organising the implementation of GSM and BOM resolutions, especially those related to the Group's annual business and investment plans. activities that do not require resolutions from the BOM. The General Director also has the following responsibilities: Managing and supervising the Group's daytoday operations. behalf MEMBERS OF THE BOD 1. Ms. Duong Thi Mai Hoa General Director 1 2. Ms. Mai Huong Noi Mai Huong Noi Deputy General Director 3. Ms. Nguyen Dieu Linh Deputy General Director 4. Ms. Vu Tuyet Hang Deputy General Director 6. Mr. Dang Thanh Thuy Deputy General Director 7. Ms. Nguyen Thi Thu Hien Chief Accountant 1

15 OPERATIONS IN 2013

16 FINANCIAL SUMMARY NET REVENUE, EBITDA AND PROFIT AFTER TAX FOR ,378 Unit: VND billion Source: VAS audited consolidated financial statements for 2011, 2012, 2013 Indicator (VND) ,626 Net revenue Cost of goods sold 18,377,638,845,706 11,346,984,128,307 7,904,472,849,072 4,092,056,174,334 2,313,739,781,730 1,306,236,537,557 7,904 7,149 Gross profit Operating profit Profit before tax Profit after tax 7,030,654,717,399 9,606,581,419,123 9,740,085,981,878 7,149,288,120,557 3,812,416,674,738 2,563,499,467,407 2,655,063,125,963 1,846,667,924,525 1,007,503,244,173 1,245,865,772,324 1,471,471,446,573 1,073,560,198,764 1,074 1,785 2,314 1,847 3,907 EBITDA 1 11,626,109,861,052 3,906,553,356,182 1,785,332,153,225 Current assets Noncurrent assets 39,844,677,687,769 35,927,970,738,026 28,796,286,198,535 27,028,589,606,142 20,039,498,304,151 15,473,136,819, Total assets 75,772,648,425,795 55,824,875,804,676 35,512,635,123,484 Profit after tax EBITDA Net revenue Total liabilities 2 57,156,105,584,507 44,951,244,544,495 27,260,458,138, Loans and borrowings 3 27,383,635,280,014 18,616,542,841,288 14,471,837,198,264 21,828,665,659,871 10,873,631,260,181 10,556,569,188,706 10,034,080,671,840 8,252,176,984,539 6,501,237,900,575 Unit: VND billion 31 Financial Ratios Gross profit margin (%) 4,144,705,643, ,062,071, ,750,939,083, ,617 Operating profit margin (%) Net profit margin (%) ,384 Net revenue growth (%) (40.26) 75,773 Profit after tax growth (%) (55.86) Total liabilities 4 /Owners Profit after tax /Owners Earning per share (EPS) (VND/share) , , , ,874 21,829 55,825 8, ,034 35,513 1 EBITDA = (Profit before tax + Interest expense + Depreciation and amortisation) Other income and interest on deposits. 2 Including advance of VND15,980,096,417,799 from customers for purchase of residential units and from longterm lease contract at Vinhomes Royal City, Vinhomes Times City and Vinhomes Riverside and Deferred revenue from longterm lease contract of VND5,960,644,462, Loans & Borrowings from credit agencies and other organisations, Loans & Borrowings = Shortterm loans & borrowings + Longterm loans & borrowings. 4 Excluding down payments from customers purchasing residential units at Vinhomes Royal City, Vinhomes Times City, Vinhomes Riverside projects as of 31 December Loans & borrowings Total assets

17 32 33 Despite challenging macroeconomic conditions, Vingroup is one of the few real estate businesses in Vietnam that managed to withstand the crisis and sustain the potential for growth. In 2013, the Group completed a record number of The macroeconomy in 2013 Despite several challenges in 2013, the Vietnamese stable, inflation was curbed, GDP grew 5.42%, interest rates declined, the foreign exchange rate and the gold increased, export growth held high at 15.4%, and there was a surplus in both the balance of trade and international foreign direct investment (FDI). In 2013, total new FDI commitment and expansion was USD billion, representing Vietnam continues to be one of the top 10 countries in terms of annual inward remittances, estimated at USD11 billion th to 70 th /148. A year with hope of resurgence for the real estate industry inventories went unsold, and bad debts continued to he sector also received widereaching support from various government policies. Stimulus plans and promotion customers and helped to overcome this difficult time. In retail leasing, despite the impacts of economic difficulties a penetration, Vietnam remains an attractive destination for both domestic and foreign investors. The retail market saw of the opening of the two largest shopping centres in customers for the first time could experience international services retail experience. In office leasing, 300,000m 2 of new office space hit the market in intensified competition amongst developers. To improve including lower rents, longer rentfree periods, free parking, etc. to attract potential customers. More incentives have continues to put even more pressure on rental rates. In residential realestate, improvements. The most notable was excitement in the condo market with an absorption rate of 11% in the fourth In the highend apartment segment, price reductions and market. Developer reputation, good locations, comprehensive amenities, readiness for immediate use or lease are Tourism and hospitality in 2013 was one of the few bright total number of international visitors to Vietnam was estimated at 7.6 million, up 10.6% against Amidst a slow global Healthcare and medical services continued to be a focal point where infrastructure cannot meet rising demand. According to the Department of Health Management, Minis hospitals, and 10,748 clinics with a total of 164,800 beds in operation. There were also 121 private hospitals with

18 6,290 beds in operation. However, the available medical current number of patient visits is 132 million per annum, 112.5%. figures, the biggest success of the Group was the remarkable progress and an impressive foundation for all Group levels. 34 healthcare services with an estimated 17.9% average growth of healthcare spending from The strong growth and demand for better services make this sector a Educational services has 421 universities and colleges with 2.2 million students, students and more than 4.1 million preschoolers enrolled at 13,500 preschools. During 2013, despite an investment of around 20% of the income and increased emphasis on people development. Operations in 2013 Thanks to the implementation of farreaching measures in all operational aspects, Vingroup achieved the highest net revenues and profit after tax in Net revenue was a record VND18,378 billion and profit after tax was close to In real estate sales and trading, mindful of the challenging environment, the Group put in great efforts to accelerate In retail and office management and leasing, during 2013, all Vincom Center shopping malls in Hanoi and Ho Chi Minh 2. These two mega malls demonstrated not These centres were also outstanding successes in underground components was over 90%, further affirming in Vietnam marked the launch of Vinhomes, representing a portfolio of highend serviced apartments and serviced villas being d m the In tourism and hospitality, Vinpearl continued to consolidate Vinpearl and Vinpearl Land welcomed more than 400,000 as inhouse guests and 1.3 million visitors to its amusement Da Nang was among the Top Ten 5starl Hotels and received an award from The Guide. Vingroup also began tourist destinations including Binh Dinh and Phu Quoc to add new and attractive vacation options under the Vinpearl brand. In healthcare and medical services, although Vinmec growth rate of over 90%, achieving total revenue of VND287 performed more than 2,300 surgeries. In 2013, the Group reached another important milestone, with the opening of an initial success. For instance, Vinschool saw rapid expansion with over 1,500 students enrolled as of 31 December Six months after starting operations of the first preschool in June 2013, Vinschool opened two track to open grade schools in In finance, a Vingroup. In October 2013, the Group completed an bond in November These landmark transactions are inspiring examples for other domestic companies, helping to affirm the leading position of Vingroup and accelerating the development and international recognition of the Group. In 2013, Vingroup continues to focus on transformational organisational restructuring, targeting a professional, effective, sustainable and superior working environment, where training and cultural values are nurtured and developed at all levels. Challenges and Opportunities in In education and entertainment services for children, 2013 is results mentioned above, Vingroup also established and sses. Vinschool was launched in April 2013, and VinKC (renamed as Kids November Some brands have achieved certain accelerate show that improvement and increasing demand from developed economies and emerging markets including Vietnam.

19 36 37 improved macroeconomic fundamentals. In 2013, Vietnam total gross domestic product (GDP) grew 5.4%. Fitch expects GDP growth to accelerate to 5.7% and 5.9% in 2014 In 2014, the Government continues to implement a tight managing inflation at a reasonable level, reducing budget deficit, bad debts, and ensuring exchange rate and interest forecast to continue to see increases in overseas remittance and to remain in the top 10 receivers of overseas remittance continue to attract strong FDI growth. volume in the last months of 2013 increased compared to increasing threefold in Hanoi and fourfold in Ho Chi Minh e as the approval for development plans of 1,200 1,300 er policies include a proposal to raise the budget deficit ceiling from 4.8% to 5.3% of GDP to expand infrastructure investment in 2014, the plan to accelerate the disbursement of the realestate support package of VND30,000 billion, more active involvement of VAMC to resolve bad debts in realestate and continued moderation of alternative investment channels such as gold, foreign exchange. These positive factors will Blueprint for 2014 while improving results in all business segments and operational assets. as a leading private group in Vietnam and in the region. In business operations: Vingroup plans to maintain high and sustainable growth in recurring income, which derives from leasing retail space in shopping malls and the management of offices (Vincom Center Ba Trieu, Vincom Center Long Bien, Vincom Center Dong Khoi, Vincom Mega management and operation of the Vinpearl chain of, tourism and recreational facilities (Vinpearl properties is expected to come from continued handed In quality service and asset management: Vingroup will continue to refine its management procedures, improve, shopping malls, Vinpearl hotels, recreational parks, Vinmec International Hospitals, Vinschool and other service centres of the Group. In corporate governance: Vingroup will continue to improve and standardise coordination with its subsidiaries and within each department at all levels. In fund raising: Vingroup will continue to research and implement effective plans to access more sources of capital from both domestic and international markets. In human resource development and building a corporate culture: The Group will promote training activities for all introduce policies to attract new talent, and emphasise discipline and individual capabilities to reinforce its corporate culture

20 FROM THE BOARD OF DIRECTORS Indicator Unit marks another important milestone for the Group. Vingroup achieved the highest net revenue and profit after tax since The strong growth in revenue from 2012 to 2013 was due to improvements in core business segments of the Group across the board. revenue, representing an increase of VND billion or 35.69% compared to Asset Structure Longterm assets/ Total assets Shortterm assets/ Total assets Capital Structure Liquidity ratio Curent ratio Quick ratio Profitability ratio Net profit margin % % % % % Times Times % % % Indicator Increase/ Reduce (%) Gross profit margin % Net revenue Profit before tax Profit after tax Indicator 2013 Net revenue from leasing activities and rendering related services Net revenue from rendering hotel, amusement park and related services Net revenue from rendering hospital and related services Net revenue from rendering education and related services Net revenue from rendering other services Indicator 2013 Gross profit from leasing activities and rendering related services Gross profit from leasing activities and rendering related services Gross profit from rendering hospital and related services Gross profit from rendering education and related services Gross profit from rendering other services 18,378 9,740 7,149 NET REVENUE BY SECTOR FOR 2013 Amount Weight (%) 14,658 1,799 1, , Amount Weight (%) 5,259 1, (60) (0.86) % 0.02% 15.67% 0.02% 8.70% 7,904 2,655 1, % 10.36% 0.17% 0.86% 0.01% % 74.80% Investment projects, leasing operations and service quality milestones, and apartments were delivered to customers on VND14,658 billion. portfolio comprises an aggregate of 362,000m 2 in net leasable area, of which 90% is attributable to shopping Vingroup has increased the total net leasable area of its 2. The average and rendering related services increased to VND1,799 billion, representing a growth of 47% compared to In 2013, Vingroup introduced customer tribute packages for existing and future customers. Existing and potential facilities free of charge (e.g. allseason pool, lounge areas in each building, tennis, badminton, and basketball promotion programs and special events have been organised Centers and Vincom Mega Malls. as of 31 December 2013 amounted 43% compared to 2012). Net value of inventories including these developments is still under construction, and the customers. Downpayments from customers in accordance with residential sale and purchase contracts and business co operation contracts recorded on the balance sheet were based on residential sale and purchase contracts signed up to 31 December to banks and other institutions as of 31 December 2013 were VND27,384 billion, of which shortterm and longterm loans and borrowings amounted to VND3,023 the end of This increase comes from the issuance of international price from issuance to date. to ts 39 7,

21 and short term investments of VND13,046 billion, representing Group issued 796,800 additional shares to exchange for all outstanding shares of PFV Investment and Trading Joint 2017 and and 1,000 bonds come due on 18 April 2016, bearing a floating interest rate. The remaining balance of bonds as at 31 December 2013 is USD298 million. As of 31 December 2013, the Group paid a total tax obligation approved the plan to issue shares to existing shareholders number of additional shares were 227,648,160. The VND2,276 billion. shares to allow certain convertible bondholders to convert VND60,000/share. Treasury shares 1 shares. Bond interest will be determined based on the average 12month saving rates paid in arrears of Vietinbank plus (+) 3.5% per annum. bearing a floating interest rate. 16 October 2014, bearing a floating interest rate. bonds (of which 1,000 bonds come due on 2 April 2016 and 1,000 bonds come due on 2 April 2018), bearing a floating interest rate. bonds come due on 27 September Interest rate applied in the first and second interestbearing periods is 13% per annum. These bonds are unsecured, bearing fixed interest rate of The bondsareunsecured, bearing interest at a fixed rate of 5% per converted Action plan for 2014 following goals: Continue to handover residential apartments at Vinhomes the market conditions. Continue to develop and maintain the high performance of regular business operations. In particular, strengthening the of shopping malls Vincom Centers and Vincom Mega Malls, managing and opearating the Vinpearl resorts, the Vinpearlland recreational facilities, Vinmec International 40 1 According to latest List of Shareholders from Vietnam Securities Depository (VSD), excluding 15,318,996 treasury shares received after the merger with PFV Investment & Trading Company. Continue to refine its management procedures and improve Vinhomes products, Vinpearl hotels and recreational parks, V momentum for the up and coming large scale properties of the Group. 41 (estimated date of completion is October 2014), Vincom Center Ha Long (estimated date of completion is November signs of improvement. To enhance marketing and advertising to attract domestic and international tourists, to increase revenues from Vinpearl hotels, resorts, and recreational complexes (such Nang), Vinpearlland recreational facilities (Vinpearl Land and experienced partners. Tinternational To affirm the Group's sustainable business development To become the number one real estate developer and one of the largest private corporations in Vietnam in terms of scale and stature.

22 42 1. Introduction of Vinschool and In April 2013, Vingroup announced its entrance into the field of education in Vietnam under the Vinschool brand. Vinschool offers a full continual education Vinschool has opened and put into operation three kindergartens in the urban areas of Vinhomes In October 2013, Vingroup launched VinKC (renamed as standard shopping education and healthcare centres In December 2013, the first VinKC went into operation at 9,000m 2. Khoi in Pincus stock exchange. Royal City gross floor (GFA) of up to 230,000m 2. Under the Vincom Mega Mall brand, this shopping mall is home to hundreds of large and Vietnamese people in general. 4. Successful landmark transactions number of investment properties including the Vincom Vincom Center Dong Khoi Office component for VND5,138 Group's cash flow. In November 2013, Vingroup introduced the Vinhomes brand high class apartments and villas with uncompro targets to provide international standard services, and introduce a 6. Punctual delivery of apartments and launch of the stimulus package ers use of swimming pools, 5 star lounges and other facilities (applicable 7. Success of the international capital markets transactions In November 2013, Vingroup raised USD200 million from the first benchmark US$denominated corporate bond offering from Vietnam. Proceeds from entertainment complex in Vietnam, and the largest in the South of Hanoi, Home to the first supermarket for children under the VinKC (renamed Kids entertainment destination for both residents and visitors. 9. Awards and recognition In 2013, Vingroup received several international awards and recognition was International In tourism and hospitality, Vinpearl won the most popular Landscape Golf Course. In finance, Vingroup continued to receive multiple awards for its financial transactions including the international bond, the governance. To meet the need for longterm sustainable of the group to create a professional, efficient and sustainable enterprise. According to the roadmap of the centralised governance model to the model of selfsustaining P&L bearing units for each line of business. This governance model has been known for its success at the next phase. Started in mid2013, the transformation business units, causing positive changes in thinking, 43

23 SELECTED AWARDS ACQUISITION INTERNATIONAL VINCOM

24 was a transformational and expansion year for Vingroup. The Group attracted media attention in several areas including realestate, finance, hospitality, healthcare, education and recreation. Many prestigious domestic and international magazines applauded Vingroup as a successful and growing private sector group with ambitions to enter the international market. 47

25 48 49 SHAREHOLDER AND INVESTOR RELATIONS sustainable development. Aiming to maximise the interests of all shareholders and to highest respect to shareholders and investors. Besides also emphasises enhancing a strong and longterm relationship consistent information to shareholders and investors. Promoting communication with existing and potential shareholders. awards. Maintaining positive relationships with local and international securities and brokerage firms, investment banks, investment funds, rating agencies, enabling them to access information shareholders and investors via ir@vingroup.net. website with comprehensive financial information, In 2013, Vingroup has organised over 200 site visits for, and Nha Trang. Vingroup was recognised as one of the top five listed companies in Vietnam with the best investor In June 2013 the Group organised an annual General Shareholders' Meeting to approve business results achieved in 2012, targets for 2013 and other important issues. Quarterly Analyst Meetings: with the participation of over 40 bondholders, investment strategic s, enhancing information Investment conferences: UBS Conference LVMC in in Hanoi; Emerging Markets Leadership Forum in Istanbul. Vingroup Tour: organised the second "Vingroup Tour" for more than 40 representatives from various securities companies and In 2013, Vingroup financial centres including Hong Kong, Singapore, successful international bonds issuance.

26 SHAREHOLDER INFORMATION Major shareholders and founding shareholders Name Address shares held Shareholding (%) Charter capital (VND): 9,296,036,790,000 (as of 31 December 2013) st time dated 19 Market price (VND/share): 70,000 (as of 31 December 2013) Market capitalisation: VND62,594 billion (as of 31 December 2013) (according to the latest List of Shareholders) Internal shareholders (as of 3 March 2014) Major shareholders (holding above 5%) Mr. Pham Nhat Vuong Ms. Pham Thu Huong Vietnam Investment Group JSC Hai Ba Trung District, Hanoi Hai Ba Trung District, Hanoi Hai Ba Trung District, Hanoi Hai Ba Trung District, Hanoi 284,622,598 49,079, ,146,902 83,999, Name Position Board of Management shares held Shareholding (%) Founding shareholder Mr. Pham Hong Linh Dong Da District, Hanoi 3,941, Mr. Pham Nhat Vuong Chairman 284,622, ,790, ,777, Ms. Pham Thu Huong Vice Chairwoman 49,079,861 3, Transactions by key executives and related parties in 2013 Mr. Le Khac Hiep Vice Chairman 75,297 10, Name Relationship with internal shareholders prior to the transaction Shares after the transaction % Shares % Rationale 50 Ms. Mai Huong Noi Member Mr. Marc Villiers Townsend Member Board of Directors Ms. Duong Thi Mai Hoa 1 General Director 87, Vietnam Investment Group JSC Dai An Construction & Investment JSC 2 Member of BOM held above 50% charter capital of Vietnam InvestmentGroup JSC Dai An Construction & Investment JSC is 125,186,722 16,472, ,146,902 3,304, Vietnam Investment Group sold 4,039,820 shares To reclaim investment 51 3,137, , Shareholder structure (as of 3 March 2014) Supervisory Committee Mr. Dinh Ngoc Lan Member 4, Category shares held Shareholding (%) sharesholders Institutional Shareholder Structure Individual 0 0 Ms. Do Thi Hong Van Member 0 0 Founding shareholders 3,941, ,849, ,079, Chief Accountant Other shareholders 366,768, , , Domestic 246,003, , ,948 Foreign 120,764, Authorised announcer Total 929,638, , , Domestic Foreign 808,873, ,764, , , ,894, Ms. Duong Thi Mai Hoa was appointed General Director as of 11 February According to latest List of Shareholders from Vietnam Securities Depository (VSD), excluding 15,318,996 treasury shares received after the merger with PFV Investment & Trading Company.

27 CORPORATE GOVERNANCE

28 MANAGEMENT REPORT Board of Management (BOM) performance In 2013 the BOM held 44 meetings and issued 147 resolutions to ratify important policies and amendments orientations, including: adjustments related to the issuance of international BOM supervision over Board of Director (BOD) activities disclosure Supervisory Committee (SC) activities and the list of audited adjustment entries of independent Coordinating activities of the Board of Directors, Board of Management and Supervisory Committee The BOM organises regular meetings to determine s Changes to the BOD, BOM and SC in 2013

29 56 RISK MANGEMENT Operational Risks synchronous measures ranging from the training of personnel, Macro economic Risks The Group has successfully managed these macroeconomic management, assessing impacts of the macroeconomic Real Estate Market Risks Material Price Risks fluctuation properly manage timing of purchases, construction plans and addition, the Group has implemented a closelymonitored Exchange Rate Risks financial instruments help the Group minimise the impact of Interest Rate Risks Liquidity Risks Key Manager Risks planning, strategic planning, continuing education and training programs to ensure a steady supply of future 57

30 BUSINESS STRATEGY names in commercial and residential properties, tourism and hospitality, hopitals, education and demonstrated Fully integrated real estate of strategically unites CREATES COMPETITIVE ADVANTAGES 1 Focus on highquality, largescale mixed use developments in major cities and further expand into selected strategic cities 2 Grow recurring revenues across targeted consumer segments hotels, recreational areas, hospitals and schools: 58 attracts premium projects focused on upper and middle class corporation that leads estate, retail and upper and middle classes spearhead consumer consumers of focused consumers through a recurring time properties to the Group capital into more 5 Further develop retail business to spearhead consumer trends, maintain leading position in retail market in vietnam: 4 Further develop inhouse sales and leasing, project management and property management capabilities and support its portfolio of prime commercial 3 Diversify and enhance property income stream and efficient capital management 59

31 SUSTAINABLE DEVELOPMENT

32 CORPORATE CULTURE At Vingroup, we respect and maximise the potential of each individual. This process and responsibility is not only reflected by our care for employees' standard of living, but also activities that help develop a corporate community. We always strive to accomplish our goal of Best People Best Products & Services Best Life Best Society. At sustainable development of the Group, and also a better life for the next generation. After more than 12 years of development and growth, Vingroup is a melting pot of backgrounds, personal experiences and diverse views, creating a set of traditions, spiritual values and unique culture which greatly contribute to the success of the Group today. and Lunar New Year (Tet) are celebrated with Group sponsored performances by popular singers and artists. These events provide a time for employees and their families to relax, rejuvenate and have fun. 62 built on professionalism and trust cohesively manifested in its six core values: CREDIBILITY INTEGRITY CREATIV ITY SPEED QUALITY HUMANITY. Emphasis is placed on speed, efficiency and orderliness, creating a special synergy that ensures strong development in all fields. its social activities. To promote the Healthy Body Refreshed Spirit Agile Manners campaign, since 2013 the Group has held a Festival of Healthy Living. Each Friday afternoon, employees participate in intramural sports and entertainment activities such as volleyball, soccer, tennis, table tennis and badminton in addition to team dancing (flash mobs, aerobics, etc.) and game shows (Catchword, Golden Bell Shaking, etc.). Management and employees are also strongly encouraged to use the stairs in the office instead of lifts to promote physical exercise. To promote the six core values of "CREDIBILITY INTEG RITY CREATIVITY SPEED QUALITY HUMANITY", the Group has launched several campaigns such as Good 5star Quality Service. These campaigns are aimed at reinforcing these core values to help all staff work with speed and efficiency while maintaining quality and creativity. The Group publishes an internal quarterly magazine, Vingroup House, to ensure effective communication of corporate updates and activities to employees nationwide. It features a wide range of interesting, useful and pertinent topics to the Vingroup community. The Group also maintains a tradition room to preserve memorabilia marking important milestones in its development. Both current and future staff history. 63 y,

33 64 HUMAN RESOURCE Labour and welfare policies Woking policies Working hours: day, 5.5 days per week for whitecollar and six days per week for bluecollar employees. In the case of tight deadlines, the company may require employees to work overtime and offers adequate compensation and upholds their lawful rights. All employees are entitled to public holidays, vacation time, and paid personal days as stipulated by the National Labour Law. Working conditions: Vingroup is committed to creating a professional working environment and office space so employees can maximise their efforts. Whitecollar employees are provided uniforms, comfortable, modern, airy offices and regular health checks. Bluecollar workers are supplied with all labour safety and sanitation equipment needed for their jobs. The Group strictly adheres to all labour safety regulations. Recruitment and training policies Recruitment: Under the slogan Vingroup Where the Best Gather and Grow, the Group has developed a refined, forward thinking, highly capable team with tremendous ability in numerous fields. Vingroup aims to attract competent, qualified candidates who are interested in a dynamic work environment focused on speed, creativity and efficiency. At Vingroup, every individual can bring their full creativity and expertise into play. Every position has specific criteria, but all workers share the same basic requirements: appropriate qualifications, determination on career advancement, a strong sense of responsibility and constant discipline. Managers must be committed to the six core values and be willing to learn, have a strong proactive and creative spirit and possess solid teamwork, management and leadership skills. The requirements for senior positions are very stringent including relevant work experience, logical thinking, good judgment, flexibility, and decisiveness as well as excellent analytical and problemsolving skills. Training Policy: Vingroup has a central focus on developing its human resources through free training cost to enhance knowledge and professional skills. It makes every employee to be a deserved representative for Vingroup and contribute to the quality of the overall Vietnamese labour force. Types of training In 2013, Vingroup focused on the development of human resources via an effective education policy. It established a roadmap and training target that clearly identified specific training programs for specific staff members. The mandatory training program for new employees (up to 3 months for Administrative Construction, up to 6 months for Service Operation): s, Basic skills: Communication skills (Administrative Construction), Standards of style, appearance and communication and the Wow! Service program (Services Operation). The training program prescribed by the State: Compliance with fire safety regulations, First Aid, occupational safety, and hygiene and food safety. The training program for staff in soft skills: Time management and planning, positive thinking, speed reading (Administrative Construction), telephone communications, motivated communication, conscientious services, quality control, mentoring 11 (buddy), appearance and personal hygiene, Wow! Service, and complaint resolution (Services Operation). Enhancing staff development, communication capacity, critical thinking, and management capacity. In addition to professional and skills training programs, several implemented in H program Transform to succeed: helping employees to have a clear view of the purpose of the proper transition for NUMBER OF EMPLOYEES AVERAGE EMPLOYEE INCOME CONTENT GROWTH Number of employees Average Income 5,562 8,731 Number of employees (persons) 5,562 7,800 7, ,731 9,100 9, % 16.67% Average Income the Group and have practical contribution to this process. The momentum transfer program and Core Values Converting and build pride in the company. First Impression Campaign to prepare for the opening event of Vincom Mega Mall Times City. Friendly Impression to further enhance the quality of service at hotels and other service facilities. Skill Contest with the appropriate training program. Remuneration, bonuses and welfare policies The Group has designed compensation and reward policies that accurately assess their competence and performance and rewards them appropriately. It aims to motivate employees to do their best work and improve productivity, quality and efficiency. Salaries and insurance Vingroup salaries are higher than the average of other businesses in the same sector. In 2013, it raised salaries based on work result and contribution to the Group. It also has a very competitive salary policy for outstanding staff with extensive experience in their fields to both retain employees and attract new talent over the longterm. Social insurance, health insurance and unemployment insurance is provided in accordance with the law, and the Group also purchases additional life insurance and personal accident coverage for all employees. Bonuses The Group has bonus policies to recognise and reward staff achievements and contributions to their respective departments or groups. The details of bonus policies are circulated to all leaders, managers and employees for execution. Primary types of commendations Extraordinary achievement awards: Given to staff that deliver excellent performance, make outstanding contributions to the community activities that promote the corporate culture. Successful completion of projects and/or campaigns: Commendations and rewards are given to staff members and departments who make significant contributions to the successful completion of projects and campaigns. Initiative rewards: These go to employees whose efforts generate greater revenues for the Group or contribute to the Good People, Good Deeds: These are awarded to staff that prevent disasters, successfully handle emergencies, rescue people from hasardous situations or return lost property to its owner. Periodic commendations and rewards: These include Employee of the Month, the Yearend Award for Excellence for individuals or group, and the Annual Group Anniversary Award for Outstanding Performance. Forms of commendation: Certificates of Merit, cash, domestic or overseas tour packages, promotions, and salary reviews. Forms of commendation: The Group emphasises staff interests, benefits and social life. It has developed a detailed welfare policy that is revised and amended regularly by management to provide highquality welfare conditions, encourage employees to capitalise on their capabilities, and motivate them to contribute more to the entitled to give gifts on important days such as birthdays, marriages, births, and when fellow staffs are ill. On occasions th ), International st ), MidAutumn Festival, and National and activities organised by the Group. Summer vacations are also organised for staff members and their families to take trips and relax. Particularly, the Group has a policy to honor and in their studies, sports, and artistic activities, in addition to organising summer camps and life skills training programs. These activities encourage children to improve their performance and make their parents proud, which in turn creates company loyalty among their parents. Vingroup has built a separate multifunction sport complex with fullscale amenities where all employees can exercise regularly. The Monthly Festival and Quarterly Festival programs feature art performances and culinary activities that provide a relaxing, fun and refreshing day for staff and their families. The Group has also established a Support Fund for Staff in (oneoff or longterm) if they are troubled by extreme hardship, unfortunate accidents, dangerous diseases, natural disasters or fires. The details of the fund are communicated clearly to all staff. Additionally, employees are entitled to preferential Vinpearl Resort, Vinpearl Luxury and Vincharm Spa as well as medical services at Vinmec International Hospital and education system of Vinschool. Unions Vingroup has established a Trade Union and a Communist Party cell to create an environment for communication, solidarity sound unit. The Trade Union was recongised as a wellfounded and outstanding unit. 65

34 SOCIAL RESPONSIBILITY COMMUNITY RESPONSIBILITY spirit and takes pride in the intelligence, resolve and humanity of the Vietnamese people. Vingroup has always been considerate community building and environmental protection activities. 66 social activities. They are aimed at supporting the poor, showing gratitude to the families of war invalids and martyrs, caring for Vietnamese Heroic Mothers, subsidising social beneficiaries and orphans in difficult circumstances, contributing to the medical sector and sponsoring educational programs. Center) is home to orphans, the elderly and welfare beneficiaries from across the country. It not only provides housing but also nurtures the spirit of the elderly and supports the comprehensive social work, education and training and foster care efforts to support disadvantaged children in becoming productive, capable citizens. Vingroup also sponsored the Promotion Fund for Vietnamese Football Talent (PVF) which was set up in 2010 to develop an effective model for training young footballers as there is currently no such training centre in Vietnam. Since its establishment the foundation has held 4 PVF courses with 180 participants and consistently won important tournaments including the U15 National Championship 2013, the Viettel Cup U10 Championships Championships Yamaha Cup, the Grade 6 and 7 Student Vingroup understands that business development must be inline with humanitarian, social and charitable activities and it will continue to pursue ever greater involvement in such programs. 67

35 ENVIRONMENTAL PROTECTION As a leadership in real estate and hospitality industry and aim to a sustainable development, Vingroup deeply understand the importance in designing, building and operating its tourism complexes, shopping malls, offices and apartments. All of its projects, from Vinpearl Nha Trang and Vincom Center Ba Trieu to urban projects such as Royal City, Times City and Vinhomes Riverside, are greenoriented with open natural areas and energysaving technologies. A green principle is applied to all Vingroup projects and development phases. Vinhomes Royal City features a green botanical parks, a large plaza and a unique sky garden. Gardens are designed in modern style but still consistent with the Vietnamese views and lifestyles, including different areas devoted to activities and facilities such as Tai Chi, a promenade, pavilion, lounge, and flower gardens. Vinhomes Times City was designed as a modern, ecofriendly urban area inspired by Singapore. It includes green spaces and a lake that cover nearly 100,000m 2. Times Ciy has made a profound impact by creating a clean, green living space, helping change the face of the landscape in the Southern Hanoi and providing residents with a contemporary, youthful lifestyle. 68 Vincom Center Ba Trieu is designed to make full use of natural light and artificial energy and receive the Energy Efficient Building award. The ventilation system is on the rooftop and continuously circulates air through the towers and stabilises the temperature and humidity in different areas. Vincom Center Dong Khoi was the first green energysaving building in Vietnam and was built in accordance with green architecture standards one of the criteria to evaluate worldclass property developments. In 2013 the Vincom were lauded with the Energy Efficient Architecture award by (Ministry of Construction) in collaboration with the Energy Conservation Center of Ho Chi Minh City. Vinmec International Hospital is based at Times City and has been highly commended for being environmentally clean and friendly. The rooms were designed and installed with modern equipment that meets World Health Organization as a oneway chain stopping crossinfection from unsterilised equipment and supplies. In addition to conventional technology, Vinmec has invested in plasma technology to ensure all supplies, equipment and consumables are charcoal and disinfected by ozone and UV systems to ensure safety and minimise the spread of waterborne diseases. Along with the water treatment system, Vinmec also diligently classifies refuse and has built highquality medical most stringent standards. Vinhomes Riverside the Peaceful Land was based on an unique design include a system of canals, diverse botanical gardens and modern public facilities and designs. The developer included a large number of fish and bird species in Vinhomes Riverside offers residents a wellfurnished, romantic and closetonature lifestyle and was one of three urban townships to be honored with the Green Architecture award from the Vietnam Association of Architects. Vinpearl Nha Trang is an environmentallyfriendly 5star most beautiful bays. It has an imported US seawater filtration system with capacity reach 1,000m 3 per day, as well as using a 1 million m 3 rainwater reservoir. These two water sources give Vinpearl a completely autonomous fresh water supply for all its activities on the island. Vinpearl water and waste water systems also comply with 10R international environmental protection standards toward prevent pollution and recycle waste water for irrigation. proactively digged deeply down and insert fertilisers. More than 40 different species were planted on the island including perennials and tropical fruits such as longan, mango, rambutan and coconut which help create a natural landscape and increase the greenery. prestigious beauty pageants such as Miss Earth 2007 and 2010, Miss Universe 2008 and Miss Vietnam World 2010 to promote ecological and environmental protection. Vinpearl Land has also promoted the breeding of a variety of animal species on the island. Every three months it brings a number of bird species and there are now tens of thousands of birds representing 50 species. The indigenous fauna on the island is strictly protected and their populations are growing. The Vinpearl Aquarium has made a considerable contribution to the protection and restoration of rare marine life. Seven rare species of shark have been raised there, three of which were listed as threatened including cat sharks (also known as zebra sharks), stone sharks and leopard sharks. They are actually quite gentle and mainly eat invertebrates. In 2010 Vinpearl released 25 cat sharks (Chiloscylliumpunctatum) into the sea, hoping to conserve the biological diversity of Nha Trang Bay. In addition to training its staff to preserve and protect the through promoting the reuse of towels and bed linens to save water, separating and recycling organic and inorganic waste. These measures have been wellreceived by guests and accordance with its reputation as a 5star resort. 69 Vinpearl has also sponsored environmental campaigns, tree planting and water preservation activities in conjunction with

36 RESEARCH AND DEVELOPMENT 70 Application of new technologies to construction Aiming to become the leading real estate hospitality and sustainable development group, Vingroup always focused on research and development activities, finding effective solutions and creating impression in each project that Vingroup is developing and finishing, from design phase to residential projects are designed with energy saving, light and space utilisation goal principle, and are friendly to the environment. Beside design, Vingroup also applied global modern technologies in construction, ensuring the project progress and quality. Many new technologies, machines, equipment and materials were used to accelerate the pace of construction, increase durability, and optimise the utility and performance leading construction experts to evaluate and optimise structural solutions to meet technical and economic criteria. utilise new materials in construction. For example, Time City used CB500 steel rather than CB400 after surveying the quality of steel to be used in construction. This resulted in saving on labour as well as increasing usable space and project sustainability. technologies such as assembly technology for Vinpearl Phu Quoc and Vincom Center Ha Long. This technology increases the durability of buildings as floor components are produced in factories, as are other construction elements, thereby reducing construction cost and accelerating progress. projects. This solution increases the carrying capacity of piles from 20% to 50%, increases sustainability and reduces construction costs. researching the domestic and foreign markets for materials of good quality, proper aesthetics and which help beautify and increase utility for users. apply energysaving designs (passive design) for airconditioning, ventilation, lighting, hot water supply and water pumping. Other solutions include using airconditioningheat recovery and heat pump with high energy efficiency, applying natural ventilation, lighting and rainwater recovery. Some environmental technologies used in Vingroup projects include solar panels and small wind turbines, which also creates a vivid landscape for the new projects. Transform to succeed develop a foundation for longterm growth, the Group has implemented the Vingroup Transformation project. Its primary goal is to motivate employees, departments and management toward a professional, efficient and sustainable working style. strategic decision to decentralise governance and develop independent affiliate companies. This optimal governance structures is modeled after large international groups and creates a strong foundation to launch Vingroup to the next level. Started only a short time ago, the project brought new Villa management. centre management. Transformation of Sales and Marketing and Hotel management. management. 71

37 CONSOLIDATED FINANCIAL STATEMENTS

38 VAS CONSOLIDATED FINANCIAL STATEMENTS MANAGEMENT Members of the Management during the year and at the date of this report are: Duong Thi Mai Hoa General Director General Director Resigned on 11 February 2014 COMPANY Vingroup Joint Stock Company ( the Company ) is a joint stock company established in Vietnam in accordance with the Business Registration Certificate No issued by the Hanoi Department of Planning and Investment on 3 May 2002 and the Business Registration Certificate No reissued on 12 May The Company also subsequently received the 51st amended Business Registration Certificate dated 19 February The principal activities of the Company are to construct and provide retail outlets, commercial offices for lease, residential units for lease and for sale, to carry out investment activities, to provide the management service and to conduct other businesses as stipulated in its business registration certificate. Mai Huong Noi Dang Thanh Thuy Vu Tuyet Hang LEGAL REPRESENTATIVE Deputy General Director Deputy General Director Deputy General Director Deputy General Director Deputy General Director and from 11 February 2014 to the date of this report is Ms Duong Thi Mai Hoa. BOARD OF DIRECTORS AUDITORS Members of the Board of Directors during the year and at the date of this report are: 74 Pham Nhat Vuong Chairman 75 Pham Thuy Hang Pham Thu Huong Vicechairman Vicechairwoman Vicechairwoman Vicechairwoman Vicechairwoman Vu Tuyet Hang Vicechairwoman Nguyen Trong Hien Mai Huong Noi Marc Villiers Townsend Joseph Raymond Gagnon Member Member Member Member Member Resigned on 8 June 2013 BOARD OF SUPERVISION Members of the Board of Supervision during the year and at the date of this report are: Do Thi Hong Van Hoang Thuy Mai Nguyen Thi Van Trinh Head of Board of Supervision Member Member Member Member 35 BÁO CÁO THƯỜNG NIÊN

39 Management of Vingroup Joint Stock Company ( the Company ) is pleased to present its report and the consolidated financial statements of the Company and its subsidiaries (collectively referred to as the Group ) for the year ended 31 December To: The Shareholders of Vingroup Joint Stock Company The management is responsible for the consolidated financial statements of each financial year which give a true and fair view year. In preparing those consolidated financial statements, management is required to: We have audited the consolidated financial statements of Vingroup Joint Stock Company ( the Company ) and its subsidiaries (collectively referred to as the Group ) preparing on 10 March 2014 as set out on pages 6 to 88 which comprise the consolidated balance sheet as at 31 December 2013, the consolidated income statement and the consolidated cash flow statement for the year then ended and the notes thereto. select suitable accounting policies and then apply them consistently; make judgements and estimates that are reasonable and prudent; state whether applicable accounting standards have been followed, subject to any material departures disclosed and prepare the consolidated financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue its business. Management's Responsibility Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance relevant to preparation and presentation of consolidated financial statements, and for such internal control as management determines is necessary to enable the preparation and presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. Management is responsible for ensuring that proper accounting records are kept which disclose, with reasonable accuracy at any time, the consolidated financial position of the Group and to ensure that the accounting records comply with the applied accounting system. It is also responsible for safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Management confirmed that it has complied with the above requirements in preparing the accompanying consolidated financial statements for the year ended 31 December Auditor's Responsibility ments and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. 76 STATEMENT BY MANAGEMENT Management does hereby state that, in its opinion, the accompanying consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at 31 December 2013 and of the consolidated results of its opera consolidated financial statements. For and on behalf of management: financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the consolidated 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 consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of ness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements give a true and fair view, in all material respects, of the consolidated financial position of the Group as at 31 December 2013, and of the consolidated results of its operations and its consolidated System and with the statutory requirements relevant to preparation and presentation of consolidated financial statements. 77 Ernst & Young Vietnam Limited Duong Thi Mai Hoa General Director Hanoi, Vietnam 10 March 2014 Tran Phu Son Deputy General Director Hanoi, Vietnam 10 March 2014 Nguyen Quang Trung No