VIETNAM COFFEE MARKET REPORT Q1/ PDF Free Download

VIETNAM COFFEE MARKET REPORT Q1/2018

Content Abbreviations 3 3. Vietnam coffee market 49 Summary 4 3.1 Classification of coffee produced in Vietnam 49 1. Business environment 1.1 Macroeconomic situation 1.2 Legal framework 1.3 Impact of trade agreements 2. World market 2.1 Industry value chain 2.2 Production 6 3.2 Process and production technology 52 6 3.3 Production 60 11 3.4 Consumption 65 19 3.5 Export Import 69 23 3.6 Inventory 75 23 3.7 Price 77 25 3.8 Distribution system and payment methods 80 2.3 Consumption 29 3.9 Competitive Analysis 82 2.4 Export - Import 2.5 Inventory 2.6 Price movement 32 4. Risk of Vietnam coffee market 86 37 5. Planning 88 39 6. Prospects and forecasts 91 2.7 Current situation in some typical countries 42 7. Enterprise Analysis 95 Financial statement appendix 117 2

Abbreviations ICO International Coffee Organization MARD Ministry of Agriculture and Rural Development SBV State Bank of Vietnam GDVC General Department of Vietnam Customs GSO General Statistics Office of Vietnam USDA United States Department of Agriculture Vicofa Vietnam Coffee - Cocoa Association Vinastas Vietnam Standards and Consumers Association VIRAC Vietnam Industry Research And Consultancy 3

Summary World coffee production in the 2014/2015 season decreased by 2.29% over the 2013/2014 season Vietnam currently grows two main types of coffee: Arabica and Robusta. Arabica is the most widely grown seed in the world, accounting for 63.22% of the total world coffee production. Domestic consumption of coffee in the period 2012-2018e with CARG of 7.9%, in which consumption of ground roasted coffee accounts for about two thirds of output, the remaining one third is instant coffee. 4

Summary In 2016/17 season, total quantity of imported coffee were estimated at 1 million bags, increasing from 640,000 bags in the previous season, The purchase of coffee from the farmers is mainly done by local traders, 5

Content 1. Business environment 1.1 Macroeconomic situation 1.2 Legal framework 1.3 Free trade agreements 6

1. Business environment 1.1. Macroeconomic situation Gross domestic product (GDP) in 2017 is estimated to increase by 6.81% compared to 2016, GDP growth rate, 2011-2017 Coffee is one of the main agricultural products of Vietnam in the world market. Structure of GDP at current price, 2017 Source: VIRAC, GSO Source: VIRAC, GSO 7

1. Business Environment 1.1. Macroeconomic situation Million VND Disposable income and household expenditure, 2008-2017f Increased tendency of disposable income is a positive factor driving demand for eating. Disposable income and increasing household expenditure over the years are the driving force behind the development of the domestic coffee industry. Source: VIRAC, GSO Million peoplle Structure of population by stratification (expenditure), 2013-2020f Vietnam is currently the country with the fastest growing rate of middle and upper class in Southeast Asia and is expected to reach 33 millions of people by 2020. Source: VIRAC, BCG 8

1. Business environment 1.1. Macroeconomic situation Export structure of major agricultural products of Vietnam, 2017 Milion USD Value and proportion of coffee in main agricultural exports, 2010-2017 Source: VIRAC, MARD Source: VIRAC, MARD 9

1. Business environment 1.1. Macroeconomic situation VND/USD Exchange rate, 2013-2017 In 2017. VND/USD exchange rate remained relatively stable around VND 22,400 Source: VIRAC, SBV Consumer confidence index in Vietnam increased sharply in Q3/2016 with 116 points, Consumer confidence index, 2014 Q3/2017 Source: VIRAC, Nielsen 10

Content 1. Business Environment 1.1 Macroeconomic Situation 1.2 Legal Framework 1.3 Free Trade Agreements 11

1. Business Environment 1.2. Legal Framework On 9 April 2012, the Ministry of Finance issued Circular 55/2012 / TT-BTC guiding the valuation of coffee gardens, tea gardens associated with processing establishments when equitization took effect from May 25, 2012. 12

1. Business Environment 1.2. Legal Framework On May 31st, the Ministry of Agriculture and Rural Development issued Decision No. 2085 / QD-BNN-TT promulgating the process of replanting Robusta coffee 13

1. Business Environment 1.2. Legal Framework National standard for green coffee 14

1. Business Environment 1.2. Legal Framework National standard for roasted coffee 15

1. Business Environment 1.2. Legal Framework National standard for ground coffee 16

1. Business Environment 1.2. Legel Framework Import and export taxes applicable to the coffee industry 17

1. Business Environment 1.2. Legal Framework Special Consumption Tax 18

Content 1. Business Environment 1.1 Macroeconomic Situation 1.2 Legal Framework 1.3 Free Trade Agreements 19

1. Business Environment 1.3 Free Trade Agreements Until the end of 2017, Vietnam has signed, implemented, and is negotiating a total of 16 FTAs. Accession to international trade agreements brings opportunities and challenges for domestic firms. Vietnam trade integration process from 1995 to present 20

1. Business Environment 1.3 Free Trade Agreements CPTPP - Comprehensive and Progressive Agreement for Trans-Pacific Partnership 21

1. Business Environment 1.3 Free Trade Agreements RCEP 22

Content 2. World Coffee Industry 2.1 Production Value Chain 2.2 Production 2.3 Consumption 2.4 Export - Import 2.5 Inventory 2.6 Price Movement of World Coffee 2.7 Current Situation in Some Typical Countries 23

2. World Coffee Industry 2.1 Production Value Chain Production value chain Activities 24

Content 2. World Coffee Industry 2.1 Production Value Chain 2.2 Production 2.3 Consumption 2.4 Export Import 2.5 Inventory 2.6 Price Movement of World Coffee 2.7 Current Situation in Some Typical Countries 25

2. World Coffee Industry 2.2 Production Thousand bags World production of coffee by season, 2007 / 2008-2016 / 2017 World coffee production in the 2014/2015 season decreased by 2.29% over the 2013/2014 season, Source: VIRAC, ICO World coffee production in the 2016/2017 season reached at 153.87 millions of bags, equivalent to 9.23 million tons, increase 1.52% over the 2015/2016 season. 26

2. World Coffee Industry 2.2 Production Structure of coffee production by types of nut, 2016/2017 Brazil is the largest Arabica producer in the world. Source: VIRAC, ICO Arabica production structure, 2016/2017 Colombia is the world's second-largest Arabica producer with production of Colombian Milds was 15.84 million bags, accounting for 16.29% of the world's total arabica production. Source: VIRAC, ICO 27

2. World Coffee Industry 2.2 Production Structure of coffee production by region, 2016/2017 Production structure by country, 2016/2017 Source: VIRAC, ICO Source: VIRAC, ICO 28

2. World Coffee Industry 2.3 Consumption Thousand bags World coffee consumption by season, 2012/2013-2016/2017 Source: VIRAC, USDA According to the International Coffee Organization (ICO), consuming coffee in the world is increasing with expectation of demand over the next five years grow up by 25%. 30

2. World Coffee Industry 2.3 Consumption Europe is the largest coffee consuming region in the world Structure of world coffee consumption by region, 2016/2017 Asia is the second largest coffee consuming region in the world, account fof 21.62% of total coffee consumption. While being the largest producer and exporter in the world, South America has a much lower consumption of coffee. Structure of coffee consumption by country, territory, 2016/2017 Source: VIRAC, USDA Source: VIRAC, USDA 31

2. World Coffee Industry 2.4 Export Import Export World coffee export output by season, 2012/2013-2016/2017 The total output of world coffee export has been continuously fluctuating over the years. In terms of export structure, coffee bean is the most exported product THE CONTENT IS INTENTIONALLY Source: VIRAC, USDA REMOVED FOR DEMO Export structure of coffee by type, 2016/2017 Source: VIRAC, USDA 33

2. World Coffee Industry 2.4 Export Import Export Export structure of coffee beans by country and territory, 2016/2017 Source: VIRAC, USDA Export structure of roasted ground coffee by country and territory, 2016/2017 Export structure of instant coffee by country and territory, 2016/2017 Source: VIRAC, USDA Source: VIRAC, USDA 34

2. World Coffee Industry 2.4 Export Import Import World coffee import by season, 2012/2013-2016/2017 Thousand bags Source: VIRAC, USDA Import structure of coffee by type, 2016/2017 Source: VIRAC, USDA 35

2. World Coffee Industry 2.4 Export Import Import Import structure of coffee beans by country and territory, 2016/2017 Import volume of roasted and ground coffee in 2016/2017 season Source: VIRAC, USDA Import structure of ground roasted coffee by country and territory, 2016/2017 Structure of instant coffee import by country and territory, 2016/2017 Source: VIRAC, USDA Source: VIRAC, USDA 36

2. World Coffee Industry 2.5 Inventory Thousand bags World coffee inventories by season, 2012 / 2013-2016 / 2017 The largest inventory increase in 2016/2017 season was in Brazil. Thousand bags Source: VIRAC, USDA Inventories of world green coffee by year, 2007-2016 Source: VIRAC, ICO 38

2. World Coffee Industry 2.6 Price Movement of World Coffee UScent/lb Price of raw coffee beans in some countries, 2007-2016 USSD/lb THE CONTENT IS INTENTIONALLY Source: VIRAC, ICO REMOVED FOR DEMO Retail price of roasted coffee in some largest importers, 2007-2016 Source: VIRAC, ICO 40

2. World Coffee Industry 2.6 Price Movement of World Coffee UScent/lb World coffee price by type, 8/2016-9/2017 The coffee price since the beginning of 2016 has always remained stable and tends to decrease slightly. Source: VIRAC, ICO 41

2. World Coffee Industry 2.7 Current Situation in Some Typical Countries Brazil Thousand bags Coffee production, consumption and export of Brazil, 2012/2013-2016/2017 Total coffee production of Brazil in 2016/2017 season is It is estimated that Brazil has about 3.5 million people working in the coffee industry, mainly in rural areas. Source: VIRAC, ICO, USDA 43

2. World Coffee Industry 2.7 Current Situation in Some Typical Countries Colombia 44

2. World Coffee Industry 2.7 Current Situation in Some Typical Countries Thousand bags Coffee production, consumption and export of Colombia, 2012/2013-2016 / 2017 Colombia is the third largest coffee grower in the world, Source: VIRAC, ICO, USDA 45

2. World Coffee Industry 2.7 Current Situation in Some Typical Countries Indonesia 46

2. World Coffee Industry 2.7 Current Situation in Some Typical Countries Thousand bags Indonesia's production, consumption and export of coffee, 2012/2013-2016 / 2017 Indonesia is the second largest producer of coffee in Asia, after Vietnam. Source: VIRAC, ICO, USDA 47

2. World Coffee Industry 2.7 Current Situation in Some Typical Countries Ethiopia Thousand bags Ethiopian production, consumption and export of coffee, 2012/2013-2016/2017 Over the years, Ethiopia has always been Africa's largest coffee producer. Source: VIRAC, ICO, USDA 48

Content 3 Vietnam coffee market 3.1 Classification of coffee produced in Vietnam 3.2 Process and production technology 3.3 Production 3.4 Consumption 3.5 Export Import 3.6 Inventory 3.7 Price 3.8 Distribution system and payment methods 3.9 Competitive Analysis 50

3. Vietnamese Coffee Market 3.1 Coffee Classification Currently, Vietnam cultivates two main types of coffee: Arabica and Robusta. Arabica Moka: Catimor: Robusta 50

3. Vietnamese Coffee Market 3.1 Coffee Classification Comparison between Arabica coffee and Robusta coffee Characteristics Arabica coffee Robusta coffee 51

3. Vietnam coffee market 3.2 Process and production technology Coffee beans production process Roasted coffee production process Instant coffee production process 53

3. Vietnam coffee market 3.2 Process and production technology Coffee beans production process Step 1: Coffee sorting machine 54

3. Vietnam coffee market 3.2 Process and production technology Step 2: Shelling machine Raoeng milling machine 55

3. Vietnam coffee market 3.2 Process and production technology Step 3: Step 4: Step 5: Hand-drying oven Rotary dryer 56

3. Vietnam coffee market 3.2 Process and production technology Step 6: Engelber Dry Milling Equipment Step 7: Step 8: Smout polishing machine Step 9: 57

3. Vietnam coffee market 3.2 Process and production technology Production process of roasted coffee beans Step 1: Step 2: Step 3: Standing roaster Step 4: 58

3. Vietnam coffee market 3.2 Process and production technology Production process of instant coffee from roasted coffee powder Extraction Condensation Drying Repatriation technology 59

3. Vietnam coffee market 3.3 Production According to the Ministry of Agriculture and Rural Development, the country now has 22 provinces and cities with 105 districts growing coffee, Structure of coffee growing area in Vietnam, 2016/17 Thousand hectares Planting coffee area in some provinces, 2014/15-2016/18e Source: VIRAC Source: VIRAC 61

3. Vietnam coffee market 3.3 Production Dak Lak, Lam Dong, Dak Nong, Gia Lai are currently the key coffee growing areas of the country. Some provinces of Vietnam growing coffee Suitable altitude for growing Robusta and Arabica coffee Source: VIRAC 62

3. Vietnam coffee market 3.3 Production Ground roasted coffee processing factories and capacity, 2017e Thousand tons / year Dak Lak is the largest coffee producing area in Vietnam Source: VIRAC, Processing Department Thousand tons / year Instant coffee processing facilities and capacity, 2017e Source: VIRAC, Processing Department 63

3. Vietnam coffee market 3.3 Production The coffee production output of Vietnam in the past years has many changes. Coffee production output of Vietnam, 2012/13-2017 / 18e Thousand bags 60kgs Source: VIRAC, USDA Coffee production structure of Vietnam, 2016/2018e Source: VIRAC, USDA 64

3. Vietnam coffee market 3.4 Consumption Domestic consumption of coffee in the period 2012-2018e Domestic coffee consumption in Vietnam, 2012/13-2017/18e Thousand bags 60kg However, compared to the average consumption of coffee in the region and in the world, the consumption of domestic coffee in Vietnam is very low, Source: VIRAC, USDA 66

3. Vietnam coffee market 3.4 Consumption In the period 2011-2016, retail coffee output in the domestic market of Vietnam Thousand tons Coffee retail sales in Vietnam, 2011-2017 Billions VND Source: VIRAC, Euromonitor Retail value of coffee in the market, 2011-2017 Source: VIRAC, Euromonitor 67

3. Vietnam coffee market 3.4 Consumption According to Market Intello's coffee consumption survey, Using habits of instant coffee, 2016 Types of coffee used at home, 2016 Source: VIRAC, Marketintello The habit of using roasted coffee, 2016 Source: VIRAC, Marketintello Source: VIRAC, Marketintello 68

3. Vietnam coffee market 3.5 Export Import 3.5.1 Import Vietnam is currently importing small quantities of fresh and roasted coffee beans and ready-made coffee from China, Laos, Indonesia, Brazil, USA... Thousand bags 60kg Import of ground roasted coffee in Vietnam, 2012/13-2017 / 18e Source: VIRAC, USDA Vietnam's coffee import market by value, 2016/2017 Import structure of coffee in Vietnam, 2016 / 2017e Source: VIRAC, GDVC Source: VIRAC, USDA 70

3. Vietnam coffee market 3.5 Export Import 3.5.1 Import Top coffee importing enterprises, 2016 / 2017e Some of the largest coffee importing enterprises, 2016/2017 Source: VIRAC, GDVC 71

3. Vietnam coffee market 3.5 Export Import 3.5.2 Export Volume and value of Vietnamese coffee exports, 2010/11-2016 / 17e Thousand tons Millions USD Export structure of coffee by type, 2017 Source: VIRAC, Ministry of Industry and Trade, Vicofa Source: VIRAC, MOIT 72

3. Vietnam coffee market 3.5 Export Import 3.5.2 Export In 2017, coffee exports reached 1.4 million tons, Million USD Monthly coffee exports, 2016-2017 USD./ton Average export price and export volume of coffee by month, 2017 Sources: VIRAC, MARD Thousand tons Sources: VIRAC, GDVC 73

3. Vietnam coffee market 3.5 Export Import 3.5.2 Export In the 2016/2017 season, Germany is the largest coffee importer of Vietnam, Structure of coffee export market by output, 2016 / 2017e Source: VIRAC, GDVC Export market structure of coffee, 2017 Source: VIRAC, GDVC 74

3. Vietnam coffee market 3.5 Export Import 3.5.2 Export Top Coffee Exporting Enterprises, 2016 / 2017e Some of the largest coffee exporting enterprises, 2016/2017 Source: VIRAC, GDVC Source: VIRAC, GDVC 75

3. Vietnam coffee market 3.6 Inventory Thousand bags 60kgs Coffeee inventories in Vietnam, 2012/13-2017/18e Source: VIRAC, USDA 77

3. Vietnam coffee market 3.7 Price Domestic price: VNĐ/kg Price of domestic Robusta raw coffee, 10/2016-12/2017 Sources VIRAC collects 79

3. Vietnam coffee market 3.7 Price Generally in 2017, coffee export price increased slightly in the first eight months and increased sharply in September, then fell sharply in the last three months of the year. USD/ton Coffee export price, 10/2016-12/2017 Sources: VIRAC collects 80

3. Vietnam coffee market 3.7 Price The average export price of coffee to 10 markets reached the highest level in 2017 Markets Average export price in 2017 (USD/ton) Compared to 2016(%) Average export price of Dec/2017 (USD/ton) Compared to Nov/2017 (%) Compared to Dec/2016 (%) Sources: VIRAC, GDVC 81

3. Vietnam coffee market 3.7 Price Vietnam is the world's second largest coffee exporter with international quality standards, but its export price is only 65-85% of the coffee export price of other countries as the coffee enterprises in the country have not identified long-term business plan, and coffee is mainly sold at the beginning of the season, 82

3. Vietnam coffee market 3.7 Price 83

3. Vietnam coffee market 3.8 Distribution system and payment methods mainly done by local traders, The purchase of coffee from farmers is 85

3. Vietnam coffee market 3.8 Distribution system and payment methods Methods of purchase and payment by farmers, purchasing agents and coffee processing factories: 86

3. Vietnam coffee market 3.8 Distribution system and payment methods Pros Cons 87

3. Vietnam coffee market 3.8 Distribution system and payment methods Pros and cons of purchasing suppliers for the company Pros Cons 88

3. Vietnam coffee market 3.8 Distribution system and payment methods Method of purchase and payment of coffee farmers, purchasing agents, processing enterprises for foreign enterprises 89

3. Vietnam coffee market 3.8 Distribution system and payment methods 90

3. Vietnam coffee market 3.9 Competitive Analysis According to Euromonitor, as for retailing coffee, Share of retail sales of some large companies in the market, 2016 Source: VIRAC, Euromonitor Share of retail sales of some brands in the market, 2016 Source: VIRAC, Euromonitor 92

3. Vietnam coffee market 3.9 Competitive Analysis According to Euromonitor, Traditional brand New brand 93

3. Vietnam coffee market 3.9 Competitive Analysis 94

Content 4 Risk of Vietnam coffee market 7

4. Risk of Vietnam coffee industry Risk in production : Risk in coffee price: Currency risk: Competitive risk coming from quality requirements : Risk coming from competitors : 96

Content 5 Planning 7

5. Planning On February 2, 2012, the Prime Minister issued Decision No. 124 / QD-TTg approving the overall planning for agricultural production development to 2020 with a vision to 2030. Accordingly, the coffee plant planning as following details:. On August 21, 2012, the Ministry of Agriculture and Rural Development issued Decision No. 1987 / QD-BNN-NT approving of planning for developing Vietnam's coffee industry up to 2020 with a vision to 2030. Development Goals : Planning Orientation: 98

5. Planning 99

Content 6 Prospects and forecasts 7

6. Prospects and forecasts Prospects 101

6. Prospects and forecasts Forecasts Thousand bags World Coffee Production, 2012/2013-2017/2018e Source: VIRAC, USDA 102

6. Prospects and forecasts Forecasts The 2017/2018 season Forecasts to 2021 103

Content 7. Enterprise Analysis 104

Enterprises' Overview Top coffee producing enterprises of Vietnam Name Address Total assets in 2016 (Billion VND) net revenue in 2016 (Billion VND) 105

Enterprises' Overview INTIMEX GROUP JOINT STOCK COMPANY 106

Enterprises' Overview OLAM VIETNAM COMPANY LIMITED 107

Enterprises' Overview NESTLÉ VIET NAM COMPANY LIMITED 108

Enterprises' Overview PHUC SINH JOINT STOCK COMPANY 109

Enterprises' Overview 2-9 DAK LAK IMPORT EXPORT COMPANY LIMITED (Simexco DakLak) 110

Enterprises' Overview JOINT STOCK COMPANY - TIN NGHIA CORPORATION 111

Enterprises' Overview TRUNG NGUYEN GROUP JOINT STOCK COMPANY 112

Enterprises' Overview Vinacafé Bien Hoa Joint Stock Company 113

Enterprises' Overview Vinh Hiep Co., Ltd Minh Tien Coffee Export Import Co., Ltd 114

Content 7. Enterprise Analysis 7.1 Profitability 7.2 Operability 7.3 Performance efficiency 7.4 Profit Ratio 115

7. Enterprise Analysis 7.1 Profitability The net revenue of companies in 2016 was higher than those in 2015 and the average growth rate is 20% because of the high growth of Vietnam coffee industry in the last 3 years. Billion VND Net revenue,2015-2016 Source: VIRAC 116

7. Enterprise Analysis 7.1 Profitability In 2016, companies in the industry have gross profit growth compared to that in 2015. Therein, Trung Nguyen has the highest gross profit margin in the industry with 41.3% in 2016. Billion VND Gross profit margin, 2015-2016 Source: VIRAC 117

Content 7. Enterprise Analysis 7.1 Profitability 7.2 Operability 7.3 Performance efficiency 7.4 Profit Ratio 118

7. Enterprise Analysis 7.2 Operability The repayment capacity of enterprises, 2015-2016 Source: VIRAC 119

7. Enterprise Analysis 7.2 Operability Vinacafe Bien Hoa and Trung Nguyen are two enterprises with the highest pay ratios in the sector because they are the two enterprises that have the least loan of the top coffee businesses, they mainly use equity capital. These are also two main businesses with domestic production and supply. Pay Ratio, 2015-2016 Source: VIRAC 120

Content 7. Enterprise Analysis 7.1 Profitability 7.2 Operability 7.3 Performance efficiency 7.4 Profit Ratio 121

7. Enterprise Analysis 7.3. Performance efficiency Total asset turnover, 2016 Phuc Sinh JSC has the largest total asset turnover with 6.22 rounds. Source: VIRAC THE CONTENT IS INTENTIONALLY REMOVED Fixed asset FOR turnover, DEMO 2016 Source: VIRAC 122

7. Enterprise Analysis 7.3. Performance efficiency Billion VND Financial Cost, 2016 Source: VIRAC Billion VND Enterprise Cost Managment, 2016 Source: VIRAC 123

Content 7. Enterprise Analysis 7.1 Profitability 7.2 Operability 7.3 Performance efficiency 7.4 Profit Ratio 124

7. Enterprise Analysis 7.4. Profit Ratio Profit Ratio, 2016 Source: VIRAC 125

Content Financial statement appendix 126

Appendix Financial Statement BUSINESS RESULTS REPORT INTIMEX GROUP JOINT STOCK COMPANY BALANCE SHEET Unit: VND 2015 2016 A. CURRENT ASSETS Unit: VND 2015 2016 Net revenue from sales and services Cost of goods sold and services Gross profit of goods sold and services Profit from financial activities Financial cost I. Cash and petty cash II. Temporary investments III. Accounts receivable 1. From customers Interest expense Cost of goods sold Administration cost Net profit from business activities Gross profit before tax IV. Inventory Current corporate income tax expense B. LONG-TERM ASSETS THE CONTENT IS INTENTIONALLY Deferred corporate REMOVED income tax expense FOR DEMO TOTAL ASSETS Profit after tax A. CURRENT LIABILITIES I. Current liabilities Unit: VND I. Cash flow from operations CASH FLOW STATEMENT 2015 2016 1. Loan and Current liabilities Depreciation of fixed assets 2. Taxes and accounts payable to the state II. Long-term liabilities 1. Loan and Long-term liabilities 2. Long-term accounts payable Gain (Loss) from unrealized exchange rate differences Net Cash flow from operations II. Cash flow from investing Shopping, building fixed assets and other long-term assets B. OWNER'S EQUITY TOTAL LIABILITIES AND OWNER'S EQUITY Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 127

Appendix Financial Statement BUSINESS RESULTS REPORT OLAM VIETNAM COMPANY LIMITED Unit: VND 2015 2016 Net revenue from sales and services Cost of goods sold and services BALANCE SHEET Gross profit of goods sold and services Unit: VND 2015 2016 Profit from financial activities A. CURRENT ASSETS Financial cost Interest expense I. Cash and petty cash Cost of goods sold II. Temporary investments III. Accounts receivable 1. From customers IV. Inventory Administration cost Profit from business activities Gross profit before tax Current corporate income tax expense B. LONG-TERM ASSETS TOTAL ASSETS A. CURRENT LIABILITIES I. Current liabilities 1. Loan and Current liabilities 2. Taxes and accounts payable to the state II. Long-term liabilities Deferred corporate income tax expense Profit after tax CASH FLOW STATEMENT Unit: VND 2015 2016 I. Cash flow from operations Depreciation of fixed assets Gain (Loss) from unrealized exchange rate differences 1. Loan and Long-term liabilities 2. Long-term accounts payable B. OWNER'S EQUITY TOTAL LIABILITIES AND OWNER'S EQUITY Net cash flow from operations II. Cash flow from investing Shopping, building fixed assets and other long-term assets Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 128

Appendix Financial Statement NESTLÉ VIET NAM COMPANY LIMITED BALANCE SHEET BUSINESS RESULTS REPORT Unit: VND 2015 2016 Net revenue from sales and services Cost of goods sold and services Gross profit of goods sold and services Unit: VND 2015 2016 Profit from financial activities A. CURRENT ASSETS I. Cash and petty cash II. Temporary investments III. Accounts receivable 1. From customers IV. Inventory Financial cost Interest expense Cost of goods sold Administration cost Profit from business activities Gross profit before tax B. LONG-TERM ASSETS TOTAL ASSETS A. CURRENT LIABILITIES I. Current liabilities 1. Loan and Current liabilities 2. Taxes and accounts payable to the state II. Long-term liabilities 1. Loan and Long-term liabilities 2. Long-term accounts payable B. OWNER'S EQUITY TOTAL LIABILITIES AND OWNER'S EQUITY Current corporate income tax expense Deferred corporate income tax expense Profit after tax CASH FLOW STATEMENT Unit: VND 2015 2016 I. Cash flow from operations Depreciation of fixed assets Gain (Loss) from unrealized exchange rate differences Net Cash flow from operations II. Cash flow from investing Shopping, building fixed assets and other long-term assets Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 129

Appendix Financial Statement PHUC SINH JOINT STOCK COMPANY BALANCE SHEET Unit: VND 2015 2016 A. CURRENT ASSETS I. Cash and petty cash BUSINESS RESULTS REPORT Unit: VND 2015 2016 Net net revenue from sales and services Cost of goods sold and services Gross profit of goods sold and services Profit from financial activities Financial cost Interest expense II. Temporary investments Cost of goods sold III. Accounts receivable Administration cost 1. From customers Profit from business activities IV. Inventory Gross profit before tax B. LONG-TERM ASSETS Current corporate income tax expense TOTAL ASSETS THE CONTENT IS INTENTIONALLY Deferred corporate REMOVED income tax expense FOR DEMO Profit after tax A. CURRENT LIABILITIES CASH FLOW STATEMENT I. Current liabilities Unit: VND 2015 2016 1. Loan and Current liabilities I. Cash flow from operations 2. Taxes and accounts payable to the state Depreciation of fixed assets II. Long-term liabilities Gain (Loss) from unrealized exchange rate differences 1. Loan and Long-term liabilities Net Cash flow from operations 2. Long-term accounts payable II. Cash flow from investing B. OWNER'S EQUITY Shopping, building fixed assets and other long-term assets TOTAL LIABILITIES AND OWNER'S EQUITY Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 130

Appendix Financial Statement BUSINESS RESULTS REPORT Unit: VND 2015 2016 2-9 DAK LAK IMPORT EXPORT ONE MEMBER CO., LTD Net net revenue from sales and services Cost of goods sold and services Gross profit of goods sold and services BALANCE SHEET Profit from financial activities Unit: VND 2015 2016 Financial cost A. CURRENT ASSETS Interest expense I. Cash and petty cash Cost of goods sold II. Temporary investments Administration cost III. Accounts receivable Profit from business activities 1. From customers Gross profit before tax IV. Inventory B. LONG-TERM ASSETS Current corporate income tax expense TOTAL ASSETS Deferred corporate income tax expense THE CONTENT IS INTENTIONALLY Profit after tax REMOVED FOR DEMO A. CURRENT LIABILITIES I. Current liabilities CASH FLOW STATEMENT 1. Loan and Current liabilities Unit: VND 2015 2016 I. Cash flow from operations 2. Taxes and accounts payable to the state Depreciation of fixed assets II. Long-term liabilities Gain (Loss) from unrealized exchange rate differences 1. Loan and Long-term liabilities 2. Long-term accounts payable Net Cash flow from operations B. OWNER'S EQUITY II. Cash flow from investing Shopping, building fixed assets and other long-term assets TOTAL LIABILITIES AND OWNER'S EQUITY Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 131

Appendix Financial Statement JOINT STOCK COMPANY - TIN NGHIA CORPORATION BUSINESS RESULTS REPORT Unit: VND 2015 2016 Net net revenue from sales and services Cost of goods sold and services BALANCE SHEET Unit: VND 2015 2016 A. CURRENT ASSETS Gross profit of goods sold and services Profit from financial activities Financial cost I. Cash and petty cash II. Temporary investments III. Accounts receivable 1. From customers IV. Inventory B. LONG-TERM ASSETS TOTAL ASSETS A. CURRENT LIABILITIES I. Current liabilities 1. Loan and Current liabilities 2. Taxes and accounts payable to the state II. Long-term liabilities 1. Loan and Long-term liabilities 2. Long-term accounts payable B. OWNER'S EQUITY TOTAL LIABILITIES AND OWNER'S EQUITY Interest expense Cost of goods sold Administration cost Profit from business activities Gross profit before tax Current corporate income tax expense THE CONTENT IS INTENTIONALLY Deferred corporate REMOVED income tax expense FOR DEMO Profit after tax CASH FLOW STATEMENT Unit: VND 2015 2016 I. Cash flow from operations Depreciation of fixed assets Gain (Loss) from unrealized exchange rate differences Net Cash flow from operations II. Cash flow from investing Shopping, building fixed assets and other long-term assets Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 132

Appendix Financial Statement BUSINESS RESULTS REPORT Unit: VND 2015 2016 TRUNG NGUYEN GROUP JOINT STOCK COMPANY Net net revenue from sales and services Cost of goods sold and services BALANCE SHEET Gross profit of goods sold and services Unit: VND 2015 2016 Profit from financial activities Financial cost A. CURRENT ASSETS Interest expense I. Cash and petty cash II. Temporary investments III. Accounts receivable 1. From customers IV. Inventory B. LONG-TERM ASSETS Cost of goods sold Administration cost Profit from business activities Gross profit before tax Current corporate income tax expense Deferred corporate income tax expense TOTAL ASSETS Profit after tax A. CURRENT LIABILITIES CASH FLOW STATEMENT I. Current liabilities 1. Loan and Current liabilities 2. Taxes and accounts payable to the state II. Long-term liabilities 1. Loan and Long-term liabilities 2. Long-term accounts payable B. OWNER'S EQUITY TOTAL LIABILITIES AND OWNER'S EQUITY Unit: VND 2015 2016 I. Cash flow from operations Depreciation of fixed assets Gain (Loss) from unrealized exchange rate differences Net Cash flow from operations II. Cash flow from investing Shopping, building fixed assets and other long-term assets Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 133

Appendix Financial Statement BUSINESS RESULTS REPORT VINACAFÉ BIEN HOA JOINT STOCK COMPANY Unit: VND 2015 2016 Net net revenue from sales and services BALANCE SHEET Cost of goods sold and services Unit: VND 2015 2016 Gross profit of goods sold and services A. CURRENT ASSETS I. Cash and petty cash II. Temporary investments III. Accounts receivable 1. From customers IV. Inventory B. LONG-TERM ASSETS Profit from financial activities Financial cost Interest expense Cost of goods sold Administration cost Profit from business activities Gross profit before tax Current corporate income tax expense TOTAL ASSETS Deferred corporate income tax expense THE CONTENT IS INTENTIONALLY Profit after taxremoved FOR DEMO A. CURRENT LIABILITIES CASH FLOW STATEMENT I. Current liabilities Unit: VND 2015 2016 1. Loan and Current liabilities 2. Taxes and accounts payable to the state II. Long-term liabilities 1. Loan and Long-term liabilities 2. Long-term accounts payable B. OWNER'S EQUITY TOTAL LIABILITIES AND OWNER'S EQUITY I. Cash flow from operations Depreciation of fixed assets Gain (Loss) from unrealized exchange rate differences Net Cash flow from operations II. Cash flow from investing Shopping, building fixed assets and other long-term assets Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 134

Appendix Financial Statement BUSINESS RESULTS REPORT VINH HIEP CO., LTD Unit: VND 2015 2016 Net net revenue from sales and services BALANCE SHEET Cost of goods sold and services Unit: VND 2015 2016 Gross profit of goods sold and services A. CURRENT ASSETS I. Cash and petty cash II. Temporary investments III. Accounts receivable 1. From customers IV. Inventory B. LONG-TERM ASSETS Profit from financial activities Financial cost Interest expense Cost of goods sold Administration cost Profit from business activities Gross profit before tax Current corporate income tax expense TOTAL ASSETS Deferred corporate income tax expense THE CONTENT IS INTENTIONALLY Profit after taxremoved FOR DEMO A. CURRENT LIABILITIES CASH FLOW STATEMENT I. Current liabilities Unit: VND 2015 2016 1. Loan and Current liabilities 2. Taxes and accounts payable to the state II. Long-term liabilities 1. Loan and Long-term liabilities 2. Long-term accounts payable B. OWNER'S EQUITY TOTAL LIABILITIES AND OWNER'S EQUITY I. Cash flow from operations Depreciation of fixed assets Gain (Loss) from unrealized exchange rate differences Net Cash flow from operations II. Cash flow from investing Shopping, building fixed assets and other long-term assets Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 135

Appendix Financial Statement BUSINESS RESULTS REPORT MINH TIEN COFFEE IMPORT EXPORT CO., LTD Unit: VND 2015 2016 Net net revenue from sales and services BALANCE SHEET Cost of goods sold and services Unit: VND 2015 2016 Gross profit of goods sold and services A. CURRENT ASSETS I. Cash and petty cash II. Temporary investments III. Accounts receivable 1. From customers IV. Inventory B. LONG-TERM ASSETS Profit from financial activities Financial cost Interest expense Cost of goods sold Administration cost Profit from business activities Gross profit before tax Current corporate income tax expense TOTAL ASSETS Deferred corporate income tax expense THE CONTENT IS INTENTIONALLY Profit after taxremoved FOR DEMO A. CURRENT LIABILITIES CASH FLOW STATEMENT I. Current liabilities Unit: VND 2015 2016 1. Loan and Current liabilities 2. Taxes and accounts payable to the state II. Long-term liabilities 1. Loan and Long-term liabilities 2. Long-term accounts payable B. OWNER'S EQUITY TOTAL LIABILITIES AND OWNER'S EQUITY I. Cash flow from operations Depreciation of fixed assets Gain (Loss) from unrealized exchange rate differences Net Cash flow from operations II. Cash flow from investing Shopping, building fixed assets and other long-term assets Net Cash flow from investing III. Cash flow from financing Net cash flow from financing Net cash flow during the year 136

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