ANNUAL REPORT 2010 - PNJ · Place of issue: Department of Planning and Investment, ho Chi Minh City...

ANNUAL REPORT

2010

2 Summary

666870

SummaryChairwoman’s message

24

101214161820222425262830

34 404244

525556586062

Company informationCompany historyVision – Mission – Business PhilosophyTitles and AwardsPNJ’s analysis and ranking by Plimsoll World Portfolio AnalysisCompany structure

1. Board of Management2. Board of Directors3. Board of Supervisory4. Company structure5. Key managers6. Subsidiaries and associations

COMPANY OVERVIEW

OPENINg

Performance reportDistribution networkCompetitive advantagesBrands of PNJ

Report from Board of ManagementShareholders’ informationRisk management2011 activity orientationInvestor relationsEnterprise’s culture

Independent auditor’s reportExtracted control activity report of PNJ in 2010Financial report

BOARD OF DIRECTORS’ REPORT

BUSINESS MANAgEMENT

FINANCIAL REPORT

COmPaNy OVErVIEW BOarD OF DIrECTOrS’ rEPOrT BuSINESS maNaGEmENT FINaNCIaL rEPOrT 3OPENINGSummaryChairwoman’s message

Ms. Cao Thi Ngoc DungChairwoman - general Director of PNJ

4 ChaIrWOmaN’S mESSaGE

Dear Shareholders,

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

0.607 1.969 1.844 2.65 1.571 4.486 4.726 4.911 3.854 4.275 4.677 5.52611.33 10.448

13.6318.105

43.958

37.148

111.661

122.127

175.674

206.555

PRoFIT gRoWTh (1989 - 2010)

Despite the Vietnam economy in 2010 still remains many difficulties, the economy has achieved growth rate of 6.78%, which means 6.5% higher than the planned target; industrial production value increased 14%, which was 12% higher than the annual plan of total retail sales; total retail sales and consumer service revenue were more than 1,561.6 thousand billion, increased 24.5% compared with 2009, total export turnover reached more than 71,6 billion, increased 25.5% compared with 2009... Besides, Vietnam economy has faced many difficulties and challenges such as high inflation, interest rates and foreign exchange rate changed out of forecasting; poorly effective investments of state-own enterprises… Especially, the year 2010 is marked by complex changes in gold price. Fear of a currency devaluation race takes place on global scale, making the world gold price increase continuously. In that trend, domestic gold price fluctuated constantly. Compared with the end of 2009, the gold price at the end of 2010 has increased 36%. State Bank has launched a series of measures to stabilize the gold market as banning trading-on-account gold, issued gold quotas for a number of businesses and issued policies on gold tariffs, issued Circular 22 regulating on the mobilization and use of capital in gold of commercial banks.

In the context of the general difficulties of the economy and especially the uncertain impact of the macro factors have had a large effect to the business activities of jewelry enterprises in general and of PNJ in particular. however, with the outstanding advantages of brand, rich and varied design, which are in line with market demands, modern production technology, improved and professionalized management systems, along with the network was expanded in most key areas and the efforts of all PNJ staff, the performance results in 2010 have gained remarkable achievements. At the end of 2010, total assets of the company was more than 2,200 billion, equity was more than 1,000 billion, total revenue made in 2010 reached 13,077 billion VND, up 35% over the same period last year, total after-tax profit reached 206.5 billion, exceeding 3% of the yearly plan, up 17.71% compared to 2009. Particularly, profit from operations of major brands contributed 72% of total profits.


• Growth rate was 6.78%, higher than proposed plan target 6.5%

• Industrial production value increased 14%, higher than the yearly plan 12%

• Total retailing and consuming service reached 1,561.6 thousand billion VND, increased 24.5% compared with 2009

• Total revenue in 2010 was 13,077 billion VND, increased 35% compared with the same period last year

• Total profit after-tax reached 206.5 billion VND, increased 17.71% compared with 2009.

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

198 131257 213

347

183 203 218

377447

724871

1,501

1,254

1,801

2,233

3,501

9,625

13,077

71217

142

REVENuE gRoWTh (1989 - 2010)

In 2010, PNJ company also won many awards such as the Quality Award in Asia - Pacific, Top 500 Retailers in Asia - Pacific, Top Jewelry Brand of the Vietnamese high-quality goods voted by the consumers, Top 7 Largest Private Companies in Vietnam published by VNR 500, and especially the Plimsoll World, a leading international organization specializing in providing industrial reports which collect statistics, make evaluation and publish PNJ ranked the 16th out of 500 largest manufacturing jewelry companies in the world.

Success of PNJ in 2010 is the result of a combination between a flexible, specific-to-each-stage plan, with the professional production activities of PNJ’s jewelry factory which is to ensure the goods are provided fully, timely and meets the highest requirements for customers. Together with a right, timely and effective strategic; activities in market research, market development, distribution development, and other activities in design, hR training, financial management... also contributed to the overall success of the company.

Ladies and gentlemen,

In 2011, the world economy in general and Vietnam economy in particular are forecast still facing difficulties and challenges, the risks of instability of the major economies like the u.S., the countries of the common European currency region... and the world gold price is also expected to set new peaks in 2011. Vietnam economy in the first months of 2011 still remains many uncertainties in the financial, monetary sectors; the complex changes in interest rates, exchange rates affect the operation of enterprises; the management policy in gold business is unclear, which create a psychological impact, investment decisions, consumer’s purchasing decisions...

Although facing many difficulties and challenges but we must always strive to affirm the spirit in many specific action programs, together with positive growth targets which are is to reach 8,400 billion of revenue, increased 15% (excluding 24K gold export revenue), after-tax profit reached 245 billion - increased 15%, total assets reached VND 2,700 billion, increased 22.7% compared with 2010. In order to achieve these targets, it requires the determination of the Board, executive

6 ChaIrWOmaN’S mESSaGE

“ Success of PNJ in 2010 is the result of a combination between a flexible, specific-to-each-stage plan with the professional production activities of PNJ’s jewelry factory which is to ensure the goods are provided fully, timely and meets the highest requirements for customers. ”

managers and all PNJ staff to implement the proposed development strategies, in order to maintain PNJ’s leading position in the jewelry manufacturing and business in Vietnam and the region. PNJ takes the core business activity is gold jewelry as the priority, build retail system development plans stably and enlargedly, especially pays attention to the growing cities/provinces with rapid consuming growth. PNJ needs to invest in expanding production scale in time to meet domestic demand and export orders. PNJ also has to narrow and the restructure capital investments. Together with the upgrading of management systems towards more and more professional and a team of human resources which not only increases by number but also by greater knowledge and capacity...

on behalf of the Board, we would like to thank the authorities, shareholders, partners, customers and the entire PNJ staff, who have trusted, supported, companied to make the success of Phu Nhuan Jewelry Joint Stock Company - PNJ today, and we hope to continue to receive more support and valuable partnership.

Kindly regards,

Chairwoman

Cao Thi Ngoc Dung


Essence of heaven and earthcoverage in each product

10 COmPaNy INFOrmaTION

Name of company: PHU NHUAN JEWELRY JOINT STOCK COMPANY

Abbreviation: PNJ

Address: 170E Phan Dang Luu Street, Ward 3, Phu Nhuan District, hCMC

Telephone: 08.39951703 - Fax: 08.39951702 - Email: [email protected]

Type of business of the Registration Certificate: 0300521758

Place of issue: Department of Planning and Investment, ho Chi Minh City

First registered: 02/01/2004; Changed the 12th on 16/02/2011

Type of business: Joint stock company

Legal representative: Ms. CAo ThI NgoC DuNg

Position: Chairman – general Director

Registered capital: 599.991.420.000 VND

Total assets: 2.201 billions VND

Type of business:

Type of business of the Registration Certificate: No.0300521758 issued by Department of Planning and Investment, ho Chi Minh City first registered on 02/01/2004 and changed the 12th on 16/02/2011.

• Business activities for gold, silver, precious metals, precious and semi-precious stones, jewelry, precious metal raw materials, souvenirs, handicrafts and fine art, fashion items and fashion accessories .

• Export and import of gold jewelry and fine art in gold, silver and other precious metals, diamonds, precious and semi-precious stones, gold bars, gold material. Export and import jewelry, imitation jewelry

• Production and processing jewelry. Production of ferrous metals and precious metals, gold bars.

• Sales of machinery and equipment of jewelry sector.

• Diamonds and gemstones testing services. Inspection services of gold, silver, other precious metals, semi-precious stones.

• Pawn service.

• Foreign currency exchange, receipt and payment of foreign currency service.

• Trading in real estate

• Trading in restaurants and other related services

• Trading in motorbikes, cars and other related services

• Transporting by road

• Vocational service

Total assets were 2.201 billion VND,

increased 27% compared with 2009

BOarD OF DIrECTOrS’ rEPOrT BuSINESS maNaGEmENT FINaNCIaL rEPOrTOPENING 11COmPaNy OVErVIEWCompany informationCompany historyVision – mission – Business PhilosophyTitles and awardsPNJ’s analysis and ranking by Plimsoll World Portfolio analysisCompany structure overview: 1. Board of management 2. Board of Directors 3. Board of Supervisory 4. Company structure 5. Keys managers 6. Subsidiaries and associations

1988

1991

2005

20042001

1992

2003

on April 28th, 1988 - Phu Nhuan Jewelry Trading Store was founded with an investment of only 14 million VND – equivalent to only 9.0 tael of gold at that time – and its first 20 employees.

In order to meet the needs of the young people, PNJSilver is launched with a high-class silver jewelry line, which has affirmed its pioneering role in the jewelry industry.

In the special 15 years of company establishment anniversary with over 1000 employees, PNJ is honored to be awarded the 1st-class Labor Medal by the President, continuing to focus on the construction of company culture.

PNJ is equitized into Phu Nhuan Jewelry Joint Stock Company. In this year, PNJ also achieved the title of Top 500 Leading Retailers in Asia - Pacific.

PNJ re-launched PNJSilver and launched a premium jewelry line CAo – Fine Jewelry. PNJ also became a founding shareholder of An Cu DongA Company, the forerunner of DongA Land.

PNJ officially launches the Phoenix gold bar, which contributes to market another payment and saving option in order to serve the investment needs of the people.

The company was renamed Phu Nhuan Jewelry Joint Stock Company. This stage witnesses great changes with bold investment in Italian technology production line. In the same year, the company also co-founded Dong A Bank and formed a joint venture with Phu Nhuan house Trading and Development Company.

12

COMPANY HISTORY1988 - 2010

COmPaNy hISTOry

1994

2007

2008

2009

2010

1998

1995 2000

PNJ is awarded the title of Vietnam high Quality goods by Saigon Tiep Thi newspaper; this shows the trust of the consumers for PNJ.

PNJ is awarded the 2nd-class Labor Medal by the President. PNJ is also certified the quality management system ISo by DNV organization.

on April 3rd, 2008 - PNJ launched new logo and re-launched gold bar trademark under a new name: Phoenix PNJ - Dong A Bank. PNJ is the jewelry sponsor of Miss universe 2008 contest.

Entering the uSA export market, PNJ was ranked Top 200 Largest Enterprises in Vietnam by united Nations Development Programme (uNDP) and many other valuable awards are the evidence to all efforts of PNJ.

Beginning to a strategic distribution system development nationwide, the PNJ Branch in hanoi was established in 1994.

Together with branding strategy for PNJ professionally, the year 1995 also marked the first time PNJ exported jewelry and received the 3rd-class Labor Medal.

PNJ shares listed on hoSE increase its chartered capital to 400 billion VND. August 2009, the Fashion Company Limited CAo formally established.

In July 2010, PNJ starts selling luxury watches of famous brands, and is the main jewelry sponsor for Miss Earth 2010 contest with impressive growth index.


VisionPhilosophyWe aim to become the leading jewelry fashion brand, with core attributes being Creativity, Fineness, and Trustworthiness.

Customer’s rights is our commitment

14 VISION – mISSION – BuSINESS PhILOSOPhy

MissionOur mission is always to enhance customers’ satisfaction, by diversifying products and services at highest quality and reasonable price, by advancing management and manufacturing system, and improving craftsmen’s skills.


PNJ ranked the 16th

largest jewelry companies in the world, published by Plimsoll.

of the Top 500

Asia - Pacific’s Quality Award 2010

National Brand 2010

TITLES AND AWARDS

16 TITLES aND aWarDS

• Third-class Independent Medal (2008)

• First-class, second and third Labor Medal

• Government’s Emulation Flag awarded through the years

• Certificate of Merit from the Prime Minister through the years

• Competitive Flag of the People’s Committee awarded through the years.

• Top 500 Retailers in Asia Pacific Award (2003 – 2009).

• Best Vietnamese Brand Award (2007)

• Vietnamese Golden Star Award (2003 – 2009)

• Award of leading jewelry brand of Vietnam High Quality Goods - Customers' Choice (1998 – 2009)

• Vietnamese record - “First enterprise invests the most modern and largest jewelry-production technology in Vietnam” (2007)

• National Quality Award (2006-2009)

• Strong Brand Award (2004 – 2009)

• Typical Saigon Businessman (2004 – 2009)

• Ms. Cao Thi Ngoc Dung - Director of PNJ achieved the Second-class Labor Medal and the title of Vietnamese Entrepreneur (2008)

1. PNJ union was honored to receive the Third-grade Labor Medal

2. Ms. Cao Thi Ngoc Dung - general Director of PNJ achieved the First-class Labor Medal

3. PNJ received the National Quality gold Award

4. Recognized by the government as National Brand

5. Voted by consumers as the Number one Jewelry Brand of Vietnam high Quality goods published by Saigon Tiep Thi Newspaper.

6. PNJ is 1 of 3 Vietnamese enterprises to receive the Asia - Pacific’s Quality Award.

7. Award of Top 500 Retailers in Asia Pacific and be among the Top 3 leading retailer enterprises in Vietnam

8. Ranked at the 16th of the world’s largest companies producing and trading jewelry published by Plimsoll.

TITLES AND AWARDS BEFORE 2010

TITLES AND AWARDS IN 2010

Top 500 Retailers in Asia Pacific Award


18

PNJ’S ANALYSIS AND RANKINg BY PLIMSOLL WORLD PORTFOLIO ANALYSIS

PNJ’S aNaLySIS aND raNKING By PLImSOLL WOrLD POrTFOLIO aNaLySIS

I. ABOUT PLIMSOLLPlimsoll World Portfolio Analysis report provides analysis of industry and financial business all over the countries since 1987. This organization is based in England and gathered a group of experts working in various fields, providing a range of valued reports for all industries worldwide, which are constantly updated, accurate and easily access by country, continent and all over the world.

Plimsoll World Portfolio Analysis is a famous brand in the world for the accuracy and reliability of the analysis reports on business operations, financial of companies and corporations worldwide. Plimsoll Report Analysis with about World Top 500 largest enterprises in the manufacturing jewelry industry has been announced as a typical example.

Plimsoll Analysis Report about Top 500 leading manufacturing jewelry companies includes the following contents:

Part 1: Best trading partners

Section 2: Revenue and the Market

Part 3: Profits

Part 4: Analysis of individual enterprises

Each company of Top 500 Jewelry Manufacturing Industry is evaluated as follows:

a. Trading power

b. Financial power

II. PNJ

Báo cáo phân tích toàn c4u Plimsoll World /78c th2c hi"n dành cho Top 500 doanh nghi"p

trong ngành s#n xu!t n; trang v6i 39 qu$c gia có ngành công nghi"p n; trang phát triBn nh7 Ln I-,

Italia, Trung Qu$c, MJ, Nga, Nam Phi,…PNJ là doanh nghi"p duy nh!t c>a Vi"t Nam nFm trong Top

500 doanh nghi"p s#n xu!t n; trang hàng /4u th5 gi6i. Không chP d%ng l.i * /ó, PNJ là công ty duy

nh!t * Vi"t Nam và khu v2c Iông Nam Á xu!t sOc nFm trong top 16 công ty hàng /4u th5 gi6i trong

ngành công nghi"p n; trang v0 t'ng doanh thu trong ngành công nghi"p, t&ng 14 b+c so v6i n&m ngoái.

ICng th=i, là công ty duy nh!t c>a Vi"t Nam và Iông Nam Á xu!t sOc x5p v3 trí th( 23 v0 l8i nhu+n

tr76c thu5 trong ngành công nghi"p, t&ng 9 b+c so v6i n&m ngoái- v78t qua c7=ng qu$c n; trang hàng

/4u trong khu v2c là Thái Lan, Singapore, Malaysia.

PNJ x5p th( 16 trong top 500 doanh nghi"p hàng /4u ngành n; trang trên th5 gi6i v0 t'ng

Doanh thu

CHng theo báo cáo phân tích Plimsoll, Doanh thu bán hàng c>a m:i nhân viên PNJ là 258.000

USD, x5p trên m(c trung bình c>a ngành công nghi"p là 183,000 USD.

II. EVALUATION OF PNJ BY PLIMSOLLPlimsoll World Portfolio Analysis is created for the World Top 500 enterprises in the jewelry industry for 39 countries with a developed jewelry industry such as India, Italy, China, uSA, Russia, South Africa ... PNJ is the only enterprise in Vietnam in the World Top 500 Jewelry Manufacturing Industry. Moreover, PNJ is the only company in Vietnam and Southeast Asia to be listed on the World Top 16 leading companies in the jewelry industry in total revenue of the industry, increased 14 spots from last year.

PNJ is also the only company in Vietnam and Southeast Asia excellently ranked the 23rd on pre-tax profit in the industry, up 9 spots from last year, and passed the leading countries in jewelry which were Thailand, Singapore, and Malaysia.

PNJ ranked the 16th in World Top 500 leading jewelry enterprises in total revenue.

According to Plimsoll Analysis Report, each PNJ staff’s sale revenue was 258,000 uSD, ranked higher than the industrial average 183,000 uSD


Simultaneously, PNJ was in Top 13 companies which have the fastest growth based on the proportion of revenue developmentICng th=i, PNJ nFm trong top 13 công ty có t$c /- phát triBn nhanh nh!t d2a trên tP l" t&ng

tr7*ng doanh thu vào n&m ngoái.

T'ng doanh thu c>a PNJ t&ng 145.1% trong n&m 2009, x5p trên m(c trung bình c>a ngành công

nghi"p n; trang là -9.8%.

Top 10 largest jewelry companies in the world ranked by number of employees

20 PNJ’S aNaLySIS aND raNKING By PLImSOLL WOrLD POrTFOLIO aNaLySIS

Theo báo cáo phân tích toàn c4u c>a Plimsoll World v0 top 500 doanh nghi"p trong ngành s#n

xu!t n; trang. Trong n&m 2009, m(c trung bình t&ng tr7*ng c>a top 500 công ty trong ngành công

nghi"p s#n xu!t n; trang b3 gi#m sút v6i con s$ -9.8% thì ng78c l.i, PNJ trong top 16 doanh nghi"p

dSn /4u trong ngành công nghi"p này l.i có b76c t&ng tr7*ng ngo.n m)c v6i 145.1%.

Bi!u "# so sánh t/ng doanh thu c3a PNJ so v%i m+c trung bình Top 500

Bi!u "# so sánh L4i nhu5n tr$%c thu- c3a các doanh nghi&p l%n, PNJ và Top 500 doanh nghi&p

trong ngành.

Theo báo cáo phân tích toàn c4u c>a Plimsoll World v0 top 500 doanh nghi"p trong ngành s#n

xu!t n; trang. Trong n&m 2009, m(c trung bình t&ng tr7*ng c>a top 500 công ty trong ngành công

nghi"p s#n xu!t n; trang b3 gi#m sút v6i con s$ -9.8% thì ng78c l.i, PNJ trong top 16 doanh nghi"p

dSn /4u trong ngành công nghi"p này l.i có b76c t&ng tr7*ng ngo.n m)c v6i 145.1%.

Bi!u "# so sánh t/ng doanh thu c3a PNJ so v%i m+c trung bình Top 500

Bi!u "# so sánh L4i nhu5n tr$%c thu- c3a các doanh nghi&p l%n, PNJ và Top 500 doanh nghi&p

trong ngành.

According to the global analysis report of Plimsoll World about Top 500 enterprises in the jewelry manufacturing industry, in 2009, the average growth of Top 500 enterprises in the jewelry manufacturing has been declined -9.8%. on the contrary, PNJ, who is in the Top 16 of the leading enterprises of this industry, however, has been experienced the remarkable growth of 145.1%.

Chart comparing total revenue of PNJ with the average level of Top 500.

Chart comparing profit before tax of large enterprises, PNJ and Top 500 jewelry enterprises.

ICng th=i, PNJ nFm trong top 13 công ty có t$c /- phát triBn nhanh nh!t d2a trên tP l" t&ng

tr7*ng doanh thu vào n&m ngoái.

T'ng doanh thu c>a PNJ t&ng 145.1% trong n&m 2009, x5p trên m(c trung bình c>a ngành công

nghi"p n; trang là -9.8%.

Total revenue increased 145.1% in 2009, ranked higher than the average of the jewelry industry -9.8%


1 2 3

45

Board of Management

1. Ms. Cao Thi Ngoc Dung Chairwoman

2. Ms. Nguyen Thi Cuc Board Member3. Mr. Nguyen Vu Phan Vice Chairman

4. Ms. Nguyen Thi Ngo Board Member

5. Mr. Bui Viet Board Member

22 BOarD OF maNaGEmENT

BOARD OF MANAgEMENT

Ms. Cao Thi Ngoc Dung ChairwomanBachelor

Ms. Nguyen Thi Ngo Board memberBachelor

Mr. Nguyen Vu Phan Vice ChairmanMaster

Ms. Nguyen Thi CucBoard Member

Master

Mr. Bui VietBoard member

Ph.D


12

3

45

Boad Of Directors1. Ms. Cao Thi Ngoc Dung

general Director

2. Ms. Nguyen Thi Cuc Vice general Director of Finance

3. Mr. Nguyen Vu Phan Vice general Director of Technology and Production

4. Mr. Le huu hanh Vice general Director of Sale

5. Mr. Nguyen Tuan Quynh Vice general Director of hR and Marketing

24 BOarD OF DIrECTOrS & BOarD OF SuPErVISOry

12

3

Board Of Supervisory1. Ms. Truong Nguyen Thien Kim

head of Supervisory Board

2. Mr. Vo Nhu To Member of Supervisory Board

3. Mr. Tran Van Dan Member of Supervisory Board


BoARD oF SuPERVISoRY

BoARD oF DIRECToRS oFFICE

LEADERShIP REPRESENTATIVES (ISo)

VICE gENERAL DIRECToR oF SALES

SALES DEPARTMENT ACCouNTINg DEPARTMENT

QuALITY CoNTRoL DEPARTMENT

IT DEPARTMENT PNJ JEWELRY FACToRY

INTERNAL CoNTRoL DEPARTMENT

ERP DATA gRouP

goLD SALES DEPARTMENT

IMPoRT/EXPoRT DEPARTMENT

DESIgNINg DEPARTMENT

AN DoNg JEWELRY CENTRE

BRANChES

JEWELRY CENTRE / goLD (SILVER) SToRES

VICE gENERAL DIRECToR oF FINANCE

VICE gENERAL DIRECToR oF TEChNoLogY

& PRoDuCTIoN

26 COmPaNy STruCTurE

COMPANY STRUCTURE

BoARD oF DIRECToRS

gENERAL DIRECToRS

MARKETINg DEPARTMENT

huMAN RESouRCE DEPARTMENT

ADMINISTRATIoN DEPARTMENT

VICE gENERAL DIRECToR oF huMAN RESouRCE & MARKETINg

PRoJECT MANAgEMENT uNIT

Total employees: 2.158

BoARD oF MANAgEMENT


28 KEyS maNaGErS

KEYS MANgAgERS


International name: SAIgoN FuEL CoRPoRATIoNAbbreviation: SFChead office: 1A Pham Ngoc Thach, Ben Nghe Ward District 1, hCMCTelephone: (08) 38.241.520Fax: (08) 38.241.521Website: www.sfc.com.vn

SAIgoN FuEL CoRPoRATIoN

on 01st January, 2000, hCMC Petrol Company officially renamed Saigon Fuel Corporation. In 2010, SFC was honored to be rewarded 3rd Class Labor Medal.

International name: Dong A Land Joint Stock CompanyAbbreviation: Dong A Land JSChead office: 43R/12 ho Van hue, Ward 9 Phu Nhuan District, hCMCTelephone: (08) 3845 6858Fax: (08) 3845 7341Email: [email protected]: www.diaocdonga.com

DoNg A LAND JoINT SToCK CoMPANY

In the past, it was An Cu Dong A Joint Stock Company, established in 2003 with the motto :”A comprehensive solution for settlement”.

30 SuBSIDIarIES aND aSSOCIaTIONS

SUBSIDIARIES AND ASSOCIATIONS

International name: Dai Viet Energy Joint Stock CompanyAbbreviation: Dai Viet Energy head office: Block A, 87/1 Street 5 Vinh Loc industrial centre, hCMCTelephone: (08) 37.65.65.65Fax: (08) 37.65.65.61Email: [email protected]: www.nangluongdaiviet.com

DAI VIET ENERgY JoINT SToCK CoMPANY

Established since June 2007, Dai Viet Co. is currently has more than 200 general Agents, 2,000 1st and 2nd level Agents, 500 industrial customers stretching from the South to Nha trang.

CAo FAShIoN CoMPANY LIMITED

In August, 2009, PNJ established CAo Fashion Limited Company. After 2 years of development, CAo Fine Jewelry has 19 stores nationwide.

head office: 205 Phan Dang Luu, Ward 1 Phu Nhuan District, hCMCTelephone: (08)-38446199Fax: (08) 39956123Website: www.pnj.com.vn

PNJ LABoRAToRY LIMITED CoMPANY

Established on 11th January, 2011, PNJ Laboratory Company was and is strengthen its position through the most stringent testing standards of the world.

International name: CAo Fashion Company LimitedAbbreviation: CAFhead office: 1170E Phan Dang luu, Ward 3 Phu Nhuan District, hCMCTelephone: (08) 3990 0776Fax: (08) 3995 1702Website: www.caofinejewellery.com


of the Vietnamese High Quality Goods, is the Number 1 Jewelry Brand

of the Vietnamese High Quality Goods, is the Number 1 Jewelry Brand

Customer's Choice

Total revenue was 13.077 billion VND,

increased 35,87% compared with 2009

34

BOARD OF DIRECTORS’ REPORT

PErFOrmaNCE rEPOrT

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The year 2010 was the record year of gold when gold price per "chi" in Vietnam increased 9.5 times due to the increase over 300 uS Dollar each ounce of the global gold price, from 1,100 uS Dollar to the peak 1,400 uS Dollar per ounce. The fluctuation of gold price significantly effected on the manufacture and business activities of all companies including jewelry companies. however, the business of PNJ still had more goods results than expected target.

1. THE ANNUAL PLAN’S RESULT• At the end of the financial year 2010, total asset reached

to 2.201 billion VND, increased by 27% compare to the end of 2009. Annual average growth rate was 25%.

• Total revenue was 13.077 trillion VND, increased by 25% compare to business plan and by 35.87% compare to 2009.

• Earnings before tax (unconsolidated) were 257,918 billion VND, increased by 5% compare to business plan and by 16.28% compare to 2009.

• Earnings after tax (unconsolidated) were 206,555 billion VND, increased by 3% compare to business plan and by 17,71% compare to 2009.

• Earnings before tax (consolidated) were 263,892 billion VND, equivalent to 95,98% of 2009.

• Earnings after tax (consolidated) were 212,018 billion VND, equivalent to 104% of 2009.

• Earnings per share were 3.433 VND, increased by 17,5% compare to 2009.

• Increased equity by issuing bonus shares to existing shareholder in the ratio 2:1, PNJ accordingly issued from its surplus capital approximately 20 million bonus shares of 10.000 VND each, increase its equity by nearly 600 billion VND.

• Dividend payout ratio in the year 2010 was 25% PNJ’s equity

2. THE SPECIFIC OPERATION’S RESULTa. Developing human resources of business system firmly, orientating PNJ a leading professional retailer. In 2010, our company focused on training and improving skills and ability for over 700 sale person and supervisor teams in the system. Especially, the reconstructing of the business system to manage nearly 140 retail stores take an important role.

b. Reorganizing jewelry factory, making a breakthrough in manufacturing and processing jewel. PNJ pays attention to train, improve skills for part of goldsmiths and enforce the professional workers. Moreover, PNJ engineers not only enhanced technology to apply in producing process but also fabricate themselves some machines in

order to augment industrial rate in jewel manufacturing process, increase material retrieving capacity , loss saving rate for all process up to 30% in comparison with itself in 2009, particularly 2,372 "chi" of bullion, equivalent to 7 billion VND, saving mainly manufacturing cost, narrowing down stages, improve productivity, reducing cost in parallel with increasing worker salary while input cost on the way to raise, output in 2010 reached 2,3 million products, increase 15,6 %. Totally and scientifically improving administrative action in factory, establishing a foundation to divide Factory into an independent until the completion of construction at go Vap in 2011.

PERFORMANCE REPORT

Revenue structure 2010

COmPaNy OVErVIEW BuSINESS maNaGEmENT FINaNCIaL rEPOrTOPENING 35BOarD OF DIrECTOrS’ rEPOrTPerformance reportDistribution networkCompetitive advantagesBrands of PNJ

c. Professionalizing financial management:- Financial management and control have to implement in every department, every store, branch; supervise frequently, adjust and update in time suitable process or regulations responding to actual activities, manage closely revenue, cost, improve the effect of company operation

- The company concentrated on organizing internal examination system in terms of regional model, aiming to control the implementation of processes, regulations and government policies at all units, subsidiaries.

- PNJ has executed good mobilization of capital, managed closely cash flow to meet production-business demand, invested in stores chain, branches and subsidiaries, ensure to balance capital effectively and optically. It also evaluated frequently the effectiveness of using capital, machines, fixed assets, make sure all resource of the company utilized effectively.

- With the target of computerizing all activities, in 2010, the company has built the ERP - system management program which is anticipated that executing application for all system in the third quarter of 2011, meeting the demand of quick, in time and effective management

d. Special products designed and made by PNJ got Vietnamese RecordsExperts of design were trained and improved skills to apply technology in designing and creating prototype. PNJ designer team has been focused on improving profession suitable to each product line, enhancing the process in collaborating with business system and marketing operation

based on model and… market trend. The total number of designed jewelry has increased 30% (in comparison with 2009), the number of product gained both in quantity and quality. PNJ experts has designed 2 products which were famous and got Vietnamese Record: gold Sim and 2 gold Artichoke (produced by 999.9 fine gold).

e. Developing new product lines, pushing dealing with bullion and expanding the market. In the first quarter of 2010, CAo has launched the new product line named Jemma to the market, which was designed in a trendy and dynamic style to serve the high-income office people. The watch sector was run since July 2010, and it now starts to sell in retails some of the well-known watch brands in its area, the business is good so far. In 2010, in exporting activities, the company has got 4 more new partners and expanded business to Japan and Canada. Moreover, PNJ promoted advertising and increased revenue in doing business on PNJ gold bullion with encouraged result, consuming rate occupied 74% the total consuming output of the whole PNJ system (increase 22% in comparison with the period in 2009). This result proves the liquidation and the brand of Phuong hoang PNJ - DongA bank gold bar implanted clearly in the market.

f. PNJ Brand is the pride of Vietnamese jewelry industry due to its reputation, high-ranking and positive brand’s image in the view of customer. With the message about the beauty of the Five Basic Elements Metal – Wood – Water – Fire – Earth according to the Eastern philosophy in jewelry, the PNJ TV commercial had impressed many audiences all the country. The website www.pnj.com.vn was improved

huMAN RESouRCE gRoWTh (1989 - 2010)

3020 42 55 66115 120

169 219 224 258

372459

530

763

959

1,3841,595

1,620

1,790

2,158

1,8601,802

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

36 PErFOrmaNCE rEPOrT

to the more professional face and functions, so that it can help PNJ serve it customer more effectively. Furthermore, PNJ have many events and sponsored program such as: Miss Earth 2011 (Miss Ecuador, the 1st Runner-up of this contest is also Miss PNJ), Miss PNJSilver Contest, "Sparking Dreams" online karaoke contest, establishing fanclub… these marketing activities had made an important role to build up the PNJ’s reputation on the market.

g. PNJ has gained a firm foothold on Vietnamese market through many years with the largest jewelry retail chain - 138 stores around the country in the year 2010, increasing 10 stores in comparison with the year 2009. The develop of PNJ’s branches in some large cities in Vietnam such as ha Noi, Da Nang, Can Tho is the proof for the rigid growth of PNJ. PNJ always wants to give its customer a luxury, modern and comfortable shopping space. online sales of PNJ had a rapid grow in the past few year, especially in the year 2010, PNJ served 2,567 customers successfully, increased 83% compare to 2009 and the revenue 3.385 billion VND, increased 338% compare to the year 2009.

h. “Unlimited Dream” of CAO Fine Jewellery after 5 years came true. The year 2010 was the fifth anniversary of the brand CAo Fine Jewellery (now is a luxury brand of CAo Fashion Company – a subsidiary of PNJ, established in August 2009). With the dream to be a luxury jewelry brand of Vietnam, and can compete with other famous brand and go to the world market, after 5 years, CAo had realize its unbounded dream. In 2011, CAo presented Ms. Stephen Pamali, Miss Ecuador, also Miss Air of the Miss Earth contest 2010 as CAo's Ambassador.

over 15 years, since 1996, PNJ Verification Center, now is PNJ Laboratory Limited Company, with experts in jewelry industry, latest technology according to international standards, has affirmed its reputation and become the leading company in gold and jewelry testing of Vietnam.

i. Corporate culture – The PNJ house continuously consolidates and develops through many corporate inside activities such as Family Festival – PNJ house, cultural and sport activities,… Especially, the born of PNJ Forum like an open house where members can share, listen and sympathy their feelings and thoughts to each other. Besides, PNJ always takes care to the charity and social sponsorship such at: scholarship “Fly to dream”, the program “Walk for the poor”, assist women who have cancer in the Centre area of Vietnam, flood in Quang Binh province, bidding CAo jewelry to help the poor,…

j. The reputation, high-ranking and positive brand’s image of PNJ have been recognized by national as well as international through many large and prestigious prizes such at: National Quality, National Brand, The leading jewelry brand of Vietnam – Customers’ choice,… and recently, PNJ has rewarded 2 international prizes: PNJ is 1 of 3 Vietnamese enterprises which rewarded the prize Asia Quality in 2010 and the ToP 500 Retailers of Pacific Asia Award. Especially, PNJ was evaluated by PLIMSoLL and ranked the 16th in 500 largest jewelry companies in the world, PNJ is the only Vietnamese company in this ranking list.


3. FINANCIAL INVESTMENT RESULT:

Note: PNJ has provision 10.8 billions VND for decrease in value of Que huong Liberty's shares

- In the year 2010, PNJ transferred 100% its share in Saigon Seafood Company. other additional investments: invested 2,203 million in SFC shares valued at 97,789 billion VND, increased its share in SFC to 49,99%; invested 2,18 million shares in Dong A Land Company, increased its share in this company to 30,62%; invested 8,469 million in DAB shares valued at 84,69 billion VND.

- Saigon Fuel joint-stock Company (SFC) had an impressive business outcome. SFC revenue was 1.462 billion VND which was 6% more than that in the business plan; earnings before tax were 73,18 billion VND, increased 22% than that in business plan; earnings after tax were 55,06 billion VND, increased 23,87% than that of 2009 and 21,25% than that in business plan.

- Dat Viet Energy joint-stock Company: the year 2010 was considered a year of hardship for either the gas Industry in general and Dai Viet Company in particular. gas prices kept fluctuating, the big gas companies kept competitive, fake gas was complicatedly rampant. Consequently, although Dat Viet’s revenue was 568 billion VND which was 3,27% more than that in business plan and 75% more than that of 2009, the company still observed the lost of 3,4 billion VND.

- Dong A Land Company: Because of many difficulties in the real estate market which badly influenced the speed of implementation of golden Square and Phu Thuan Residence in District 7, the company’s two key projects, Dong A Land’s business outcome was predominantly earned from construction and advisory services. Total revenue in 2010 was 72 billion VND, earnings after tax were 2,9 billion VND.

Profit after tax was


206,555 billion VND

38 PErFOrmaNCE rEPOrT

4. THE ELEMENTS WHICH EFFECT TO THE BUSINESS’S RESULTS:a. The market research, evaluation and development are always done frequently and effectively. Marketing and promotion campaigns have been run timely, so that these activities can stimulate customer’s demand.

b. The system of retailing stores is frequently improved which aims to build up a good image and homogeneous identity system. This is one of main effects which brings a huge amount of customer to PNJ.

c. PNJ also focuses on the style and design through the investment in human resource, equipment, technology,… to meet the demand and consumption of the customer. PNJ often launches new products and catalog with the objective to lead the market trend and meet the customer’s need in different sales periods of year.

d. PNJ always invests in new equipment, technology to well serve the manufacture ensure the technology requirements of luxury products, improve the productivity, ensure the profit proportion, timely respond all customer' orders.

e. The salesperson of PNJ are always trained communi-cation skill, selling skill, provided information about new product line, technology to give the customer their best consultant.

f. The selling, exchanging and warranting policy of PNJ always make their customer happy because it balances between customer and company benefit. This policy is used in all PNJ retailing stores, it not only make the customer convenience, but also create the trust about PNJ brand in their mind.


40 DISTrIBuTION NETWOrK

with 142 retail stores.

retail distribution systemLargest in Vietnam

Quang NinhQuang TriSoc TrangSon LaTay NinhThai BinhThai NguyenThanh hoaTien giangTra VinhTuyen QuangVinh LongVinh PhucVung TauCambodiaThailand

2929271

89125

1740192

655

3231

HCM CITYDistrict 1:174 Le Thanh Ton St.Vincom Center (floor L1)292 hai Ba Trung St.TAX Shopping Mall- Nguyen hue St.Citi Plaza - Nguyen Trai St.Nowzone - Nguyen Van Cu St.Phu Nhuan District:52 Nguyen Van Troi St.159 Phan Dang Luu St.Co.opMart Nguyen Kiem St.District 3:652 Nguyen Dinh Chieu St.4A Cao Thang St32 Cach Mang Thang Tam St.District 5:7 An Duong Vuong St.Parkson hung VuongDistrict 6:255A - 255B hau giang St.District 7:Lotte MartDistrict 9:Co.opMart ha Noi high WayDistrict 10:Maximark 3/2District 11:Parkson Flemington - Le Dai hanh St.Lotte Everich - Le Dai hanh St.District Tan Binh:47-49 Ly Thuong Kiet230B Le Van SyMaximark Cong hoaTan Son Nhat AirportTan Phu District:BigC Phu Thanhgo Vap District:362A Nguyen Van Nghi21/3 Quang TrungBinh Thanh District:127A Dinh Tien hoangThu Duc District:141 Vo Van Ngan

RETAIL DISTRIBUTION SYSTEM WHOLESALERSHA NOI

Hai Bà Trưng District: 37B Tran Nhan TongTTTM Trang TienVincom CenterCầu Giấy District:BigCĐống Đa District:129 Chua Boc

HAI PHONGParkson hai Phong - TD PlazaBigC hai Phong

VINH CITYBigC Vinh

DA NANG70-72 Tran Phu - hai Chau123 hung VuongCo.opMart Đa Nang

HUE CITYCo.opMart hue

BIEN HOA CITYBigC Bien hoa

VUNG TAY CITYCo.op Mart Vung Tau

LONG ANCo.opMart Long An

CAN THO CITY46 Ngô QuyềnCo.opMart Cần Thơ

LONG XUYEN CITYCo.opMart Long Xuyên

KIEN GIANG38 hoang hoa Tham Co.opMart Kien giang

661

2115363694

9402889721984392329

1691340

An giangBac giangBac LieuBac NinhBen TreBinh ĐinhBinh DuongBinh PhuocBinh ThuanCa MauCan ThoDa NangDac LacDong NaiDong Thapgia Laiha giangha Namha Noiha Tinhhai Duong

hai PhonghCMhoa Binhhuehung YenKhanh hoaKien giangKonTumLam ĐongLang SonLao CaiLong AnNam ĐinhNghe AnNinh BinhNinh ThuanPhu ThoPhu YenQuang BinhQuang NamQuang Ngai

28550

2239

5621163111

5149321651

38185342

2010 EXPORTINg MARKET In 2010, PNJ has more than 4 partners and expanded to Japan and Canada. Currently, PNJ is the biggest jewelry exporters in Vietnam.

Putting the priority in developing the distribution system nationwide as a strategy, PNJ currently has 142 sole retail stores nationwide, and nearly 3,000 wholesalers, which concentrated in 56 cities around the country.

All of the retail chain locations are designed by a unique style, stand out and sell PNJ products only. This is the key channel creating the PNJ brand, and is the superior advantage of the company, making the major contribution for the sustainable development of the company.

u.S.A

Canada

germany

Australia

Japan

Vietnam

Denmark

Export market in 2010


1. Human resource & Enterprise culture: is the first key, and most important competitive advantage of PNJ. PNJ is proud of its human resource which is large in number, strong in quality and perfect in all important areas.

During 23 years of development, PNJ always respected its human resource element with the following criteria: enthusiastic and whole-hearted with his/her job, united and cooperative in teamwork, having knowledge and high professional skills. PNJ has more than 1,000 skilled workers, dozens of engineers, specialists, and a dynamic managing team who have knowledge in all areas from designing, making jewelry to marketing, sales and professional management with the humanity culture “PNJ Common Roof”. Throughout regularly annual trainings as well as social activities, every member is linked together to become a dynamic and creative unite.

2. Advanced technology and modern equipment/mechanical systems: Currently, PNJ is mastering the most advanced technology of manufacturing jewelry in the world in all fields such as machine-made chain, casting jewelry, stamping jewelry and hand-made jewelry. This technology is supported by the most modern mechanical systems such as Laser & uV prototyping machines, CNC machines, plating machines and other machines which are used by a team of excellent engineers and skilled-workers. Through strategic relationships with suppliers and well-known customers around the world, these technology systems and equipment are always upgraded and added annually to keep up with the latest technical advances.

3. Logical management system: All human resources, technology and equipments of PNJ are operated with a modern and logical management system which includes quality management system according to the international standard ISo - 9001; environmental management system

COMPETITIVE ADVANTAgES

ISo - 14001; flexibly, tightly financial management and risk management systems. All management systems are integrated into a unified, streamlined and efficient system of management, so they are able to promote their maximum strength of human resources as well as the technology and modern equipment systems. With the criteria “overcome - prevent and non-stop improve”, the management system of the company are timely reviewed and improved every year.

4. Reputation, brand and market: Throughout 23 years of building and development, PNJ has become a leading brand in the jewelry industry in Vietnam, also has created an enviable reputation in the consumer’s mind. PNJ is a brand of reliable quality, subtlety and creativity of the designs and products. PNJ’s brands such as PNJgold, PNJSilver, CAo Fine Jewellery, Jemma, Phoenix PNJ – EAB gold Bar have always been a high trust for consumers, and are a significant advantage of PNJ on domestic market. Moreover, PNJ also creates a good reputation with foreign customers from the u.S., germany, Japan, Australia, which are a solid foundation for the development of export markets of PNJ.

The network of 142 retail stores and nearly 3,000 wholesale-customers nationwide of PNJ is the condition to ensure for both of the product consumption and the best advertising tool for PNJ in business.

In general: The internal strengths (human resources, technology and modern equipment, advanced management system) and external strengths (reputation, brand and market) are combined together to create a strong and sustainable competitive advantage for PNJ. Maintaining and developing those strengths is the key to success.

42 COmPETITIVE aDVaNTaGES


A team of nearly 1000skillful goldsmiths

44

BRANDS OF PNJ

BraNDS OF PNJ

With the prestige of the two brands in gold business and banking in Vietnam: the Phu Nhuan Joint Stock Company - PNJ and the Commercial Bank of DongA, together with the commitment of ensuring the quality of 999.9 fine gold, Phoenix PNJ – DongA Bank gold Bar was re-launched in April, 2008 and has quickly become popular, has met the needs of the domestic market.

The Phoenix PNJ – DongA Bank gold Bar with several types of high-value gold bars as 1 "chi", 2 "chi", 5 "chi" and 1 "tael" with the advantages of safety, convenience in saving, flexibility in exchange, transporting... with high liquidity, nationwide trading system, attractive and competitive procurement policy to other brands.

Phoenix PNJ – DongA Bank gold Bar


officially presented in Vietnam market in 1989, PNJ gold jewelry brand always endeavor in the position of a pioneer, a leader in the investment in modern equipment, high-skilled human resource contributes to the development and professionalization of the traditional jewelry industry of Vietnam.

Throughout nearly 23 years of hard work and constant innovation, PNJ gold jewelry brand continuously has released hundreds of new collections with breakthroughs in design, style, and material … initiating new fashion trends. Based on the 10k, 14k, 18k, 24k sterling gold with a full line of wedding jewelry named golden happiness, diamond jewelry, color stone jewelry and other categories such as necklace, pendant, earrings, ring, bracelet ... which make a contribution to celebrate the beauty, elegance and grade for Vietnamese consumers, as well as an evidence connecting love of couples.

Total revenue in 2010 made of PNJ gold jewelry brand reached 2934 billion, up 36.58% over the same period.

46 BraNDS OF PNJ

The establishment of the silver jewelry brand in 2001 - PNJSilver - marked a new breakthrough in serving the needs of young customer segment - an open market at that time. In 2005, with a new identified system based on the pink key color and slogan “Sparkling Dreams”, PNJSilver brand has created a new consumption trend for Silver jewelry for this type of customer target.

Besides bringing in jewelry products made by 92.5% pure silver plated by a Rhodium protection layer, with modern, young design for young people, PNJSilver also created many helpful playgrounds with a desire to accompany young Vietnamese’s dreams. Most recently, the Miss PNJSilver contest has created a powerful influence within the students with a message as “Be confident and strive hard to make dreams come true”.

Total gross profit of PNJSilver in 2010 is 86.31 billion, up 37.85% over the same period and gross profit rate reached 71.63% of revenue.


CAo Fine Jewelry – a luxury Jewelry brand was introduced to the market in 2005 with an orientation of improving the production technology and creating jewelry to a new level. Every CAo Fine Jewelry product is considered a unique masterpiece that the craftsman has cleverly created sophisticate details on the precious metals background and precious natural stones.

In 2009, CAo Fine Jewelry officially become one of the subsidiary of PNJ with the development orientation is a high-class fashion company with high-class fashion labels in local and overseas markets. With this position, the CAo Fine Jewelry gradually expands its distributional system nationwide; claiming its grade in direct competition with high-class international jewelry brands which have been presented in Vietnam.

48 BraNDS OF PNJ

Being a brand of a high-class jewelry and fashion accessories company as CAo Fashion Company - a subsidiary of PNJ, JEMMA brings in a new choice for young ladies, especially female officers in renewing themselves and affirming user’s personality.

JEMMA consists of two main lines which are jewelry - accessories and handbags. All products are designed by Korean and Italian designers, and based on the latest fashion trends in the fashion centers around the world. With raw materials imported from overseas, together with the modern production/technology processes which are under strictly quality control, every JEMMA’s product was not only catch up the fashion trends but also is a symbol of class and luxury.


is the

jewelry exporterVietnam's largest

Increase share capital to

599.991.420.000 billion VND

52

REPORT FROM BOARD OF MANAgEMENT

rEPOrT FrOm BOarD OF maNaGEmENT

Board of Management:PNJ’s Board of Management in 2010 has 5 members, including Chairman and 4 members, which has Ms. Cao Thi Ngoc Dung as Chairman and also general Director of the Company. There are 3 Board members work at PNJ and 2 members do not work in the company.

Mr. Dang Phuoc Dua resigned from the Board on 25/02/2011 due to family issue and the Board has approved his resignation on 08/03/2011. After that, the Board assigned Mr. Bui Viet as the Board’s Commissioner of the tenure from 2007 to 201.

Board of Supervisory:Board of Supervisory consists of 3 members, including a head and 2 members by Truong Nguyen Thien Kim as the head, in which, a member works directly at the company and 2 other members do not directly work at PNJ.

Performance task in 2010:Production and business results of the company in 2010:After the Annual Shareholders general Assembly 2010 approved the Resolution, including the orientation of production and business of the company in 2010 and delivered to the Board of Management to organize the implementation of the Resolution, the Board has determined the strategies, objectives of business development and delivered to general Director to execute.

In the past year, the Board of Management implemented the supervisory function to ensure that results obtained from the management task of the general Director in accordance with the planned objectives, orientation and plan. Simultaneously, the Board has a policy to promptly solve practical problems and difficulties.

The achieved production and business results in 2010 of PNJ Company as followings:

• Sales reached 13,077 billion, exceeding 18.8% higher than 2010 plan and increasing 35.87% compared to 2009.

• Profit before tax was 257.9 billion, exceeding 5.26% higher than 2010 plan and increasing 16.69% compared to 2009.

• The average income of employee was 5.2 million VND per month.

Report on The implementation of Resolution of the Shareholder Meeting in 2010:• Adjust the business trade: On 19/07/2010, according to

the Certificate of business registration provided by the Department of Planning and Investment of ho Chi Minh City, PNJ has revised and supplemented a number of business lines. Also, PNJ has edited charters to suit the adjusted business trade.

• Issuing the bonus shares to increase charter capital: from 399,999,210,000 VND to 599,991,420,000 VND by the execute right’s ratio 2:1 and additional listing of shares issued. It has been completed on 11th August, 2010.

• Issuing the convertible bond in 2010: Board of Management implemented procedures to stop issuing 1,000,000 convertible bonds to the existing shareholders and outside investors under the Resolution of the 13th general Shareholder Meeting - No. 1331/2010/NQ-DhDCD-CTY on 01st November 2010.

• Equitizing the CAO Fashion Limited Company: Board of Management did not make the decision of equitizing CAo Fashion Limited Company by the Resolution of the 13th general Shareholder Meeting - No. 1331/2010/NQ-DhDCD-CTY on 01st November 2010.

• Establishing the PNJ Laboratory Limited Company and authorize Chairman to decide the consistent time of execution, authorize Chairman to rename the company or make adjustment appropriate to the law. Board of Management of Management has established the PNJ Laboratory Limited Company by the Resolution of the 13th general Shareholder Meeting - No. 1331/2010/NQ-DhDCD-CTY on 01st November 2010, results as follows:

- Company Name:

PNJ Laboratory Limited Company

- Name in Vietnamese:

Công ty TNhh Một thành viên giám định PNJ

- Name in English:

PNJ Laboratory Company Limited

- Abbreviation:

PNJL Co., Ltd.

- Certification of Business Registration No.:

0310521330 by the hCMC Department of Planning and Investment issued on 16th December, 2010

- Address:

205 Phan Dang Luu, Ward 1, Phu Nhuan District, hCM City

- Lines of business:

Testing services: diamonds, gold, gold alloy, silver, precious metals, color metals, precious stones, semiprecious stones and minerals, and other color stones, jade.

Retailing/wholesaling machinery, equipment and materials of appraisal industry, gemstones and

REPORT FROM BOARD OF MANAgEMENT

COmPaNy OVErVIEW BOarD OF DIrECTOrS’ rEPOrT FINaNCIaL rEPOrTOPENING 53BuSINESS maNaGEmENTreport from Board of managementShareholders’ informationrisk management2011 activity orientationInvestor relationsEnterprise’s culture

semiprecious stones industry.

Consulting about diamonds, gemstones, semi-precious stones, gold, silver, color metals and precious metals.

Engraving on diamonds, gemstones, semi-precious stones, gold, silver, color metal and precious metals.

Vocational training.

- Capital: 10,000,000,000 (ten billion) VND.

- Authorized representative: Mr. Le huu hanh - Chairman of the Company.

- Legal representative: Company Chairman.

- Starting: from 01st January, 2011.

Organizing Board Assemblies:- In 2010, the Board of Management organized 56 business meetings, through which issued 31 Board Resolutions. The meetings were conducted in the correct order and procedures prescribed by the Company Charter and the

Enterprise Law to promptly solve the arising problems.

- Minutes of Board meetings were signed by all Board members participated in those meetings, ensuring the proper form as prescribed by the law; records and documents were sent to all participating members for reference, previous studies under the regulations.

- The Board members have a sense of solidarity and have shown all responsibility and implementation of the rights and obligations of a Board member under the provisions of the regulation.

Basic earnings per share were


3.443 VND

54 rEPOrT FrOm BOarD OF DIrECTOrS - SharEhOLDErS’ INFOrmaTION

1. The rate of owning share and the change of it in management broad:

2. Big shareholders (owning from 5% charter capital and above):

3. Domestic shareholder:

4. Foreign shareholder

SHAREHOLDER INFORMATION


The management systems, which are modern, logic, flexible, tight, and having highly specific nature, will unify into a streamlined, efficient and united management system, built on the

following criteria: overcoming - preventing and upgrading continuously.

“

”

56 rISK maNaGEmENT

Market risks: Increasing competition, including the unfair competition of some jewelry enterprises do not keep products with proper quality, however there is no agency to verify and handle. Between businesses declare fair taxes with business pay poll taxes. Foreign jewelry products smuggle into Vietnam are increasing, however the government may not have proper preventions as well as quality controls.

Remedies: make absolute commitment and maintaining quality of products and sterling gold. Product designs are diversity for many target customers, and take quality, design and price as competitive advantages. Applying modern technology and logical management to reduce costs to ensure the benefits of consumers, tax norms, and adequate profits for enterprise.

gold price and foreign currency risks:gold price risk is the biggest risk in business because gold price changes every hour currently. Foreign currency prices also change frequently.

Precautions:- PNJ has no speculation policy in the gold business.

- There are a specific division always monitoring changes in gold prices and a networking system throughout the organization to timely balance the volume of daily purchases. Always ensure to balance inventory in the entire system with the loan gold of the Banks.

- Foreign currency is balanced by buying contracts.

Human resource risks:As a special business, PNJ’s human resources mostly have practical trainings at PNJ within a long time (from workers to managers) to be able to promote their capacity. The jewelry industry in Vietnam is on the rise in the present and also in the future, many new businesses enter the market, lack of experienced labor force; hence it tends to attract human resources from PNJ by wages and treatment regime.

Precautions:- Strengthening corporation culture,

- Improve working environment.

- Pay attention to wage policy and timely encourage/reward.

- Recruit and prepare additional trainings.

Risks of fire, theft, fraud:Precautions:

- Fully equip fire protection equipments, regularly coaching, training and raising awareness about fire protection at every unit.

- Buy a full range of insurance, to prevent break-downs.

- Fully issued rules and processes on management of goods in shops, warehouses and transportation to bind personal responsibility and build a strong internal control division manage risks.

Risks of technology, product quality and uncommitted services:Remedies: Establish an advanced and strong quality management system to control before, during and after the process. The customer service division always listens to feedback from customers to overcome the shortcomings.

Investment risks: Risk of investments caused by the influence of the financial market and policy.

Remedies:

- No short-term financial investments.

- No investments in areas where PNJ does not have the experience and advantage.

- have plans to liquidate ineffective investments.

RISK MANAgEMENT


In 2011, the world economic situation is predicted still not out of crisis, our country’s economy in 2011 still maintains many uncertainties, especially in the financial sector, monetary. Interest rate is still too high, beyond the endurance of the enterprises. Purchasing power is dropping, the situation of foreign currencies and gold price continue to fluctuate complicatedly. Policies of gold industry have not been determined clearly. however, PNJ claims to continue accelerate in all activities to maintain and strengthen its leading position in the jewelry industry in Vietnam, with the action plans and specific goals:

Quality goals: - Empowering in local and foreign market with

professionalism and creativity in all activities, improving the quality of human resources, synchronization quality of operations of other fields and units.

- Maximize profits; combine improving PNJ staff’s quality of life and shareholders’ benefits.

ORIENTED ACTIVITIES IN 2011

Action programs1. Strengthen the management systems, improve the quality

of customer service, continue to develop and invest in retail systems, take priority to develop large stores in the fashion and shopping centers in big cities. Particularly pay attention to the development of provinces/cities with high growth rates of consumption. Make investment in upgrading existing stores in order to create luxury and modern shopping spaces to meet increasing demands of customers. Taking developing gold jewelry retail system as key task.

Planning targets:The overall growth across the company

Profit before tax (unincorporated)

Profit after tax (unincorporated)

Profit before tax (incorporated)

Profit after tax (incorporated)

Dividends in 2011

15%

295 billion VND, increase 15%




25%

58 2011 aCTIVITy OrIENTaTION

2. Implement research programs on consumer behaviors and jewelry trends in domestic and abroad to better meet customer needs. At the same time, develop marketing programs appropriating to each time in the year, creating the impression for the product lines and the PNJ brand.

3. In design field, confirm the subtlety and creativity; make researches to release new product lines, which in line with consumer trends and the needs of particular customer target in order to diversify product lines of PNJ and meet the diverse needs of the market.

4. Make investment in building new jewelry factory which ensure doubled-productivity in scale and modern technology processes. Consolidate operating systems by using management tools such as ISo, TQM, 5S, and thoroughly implement LEAN project.

5. Make investment to improve the quality of human resources, especially middle and high management level. Salary/reward policies will be adjusted to ensure to be compatible with the common ground, to attract and develop talents. Focus on training the salesperson to

become a professional sales force - worthy as ambassadors of PNJ on the entire system. hire consultants to evaluate and improve the salary policy. Run training programs to improve the leadership for managers by international standards. Estimated budget for the training programs is 3 billion by the end of 2012.

6. Standardize operating procedures to help to develop applications in the ERP management program for all the units on the entire system. Intensify inspection, supervision and efficiently use of capitals, ensuring the company’s resources are used optimally and best.

7. Focus all resources for production, restructure the investment portfolio, and assign a number of investments in appropriate time.

8. Complete the Tourist Shopping Centre project.


60 INVESTOr rELaTIONS

INVESTOR RELATIONS

PNJ maintains effective and timely channels of communication information to investors through the Shareholder general Assembly which is held annually. The function of the investor relations department - IR of PNJ was established in early 2010 with members as follow:

1. Ms. Nguyen Thi Cuc Vice general Director as head of IR Dept

2. Mr. Nguyen Tuan Quynh Vice general Director of Investment as Vice of IR Dept

3. Mr. Pham Ngoc hung Deputive Director of Accounting as Member of IR Dept

4. Mr. huynh Van Tan Deputive Director of Marketing as Member of IR Dept

5. Ms. Trinh Thi Ngoc hieu Secretary of Board of Management and Board members as Member of IR Dept

The IR Dept. has the function to deliver information to local and foreign investors periodically and regularly business results of PNJ by month, quarter, and year; provide important information about development strategies; answer, listen to, update and process information and issues that investors interested in, together with activities that involved contact with many potential investors.

In 2011, IR Dept. has welcomed and worked with nearly 50 investors as securities companies, local and foreign investment funds as well as individuals. At the same time, IR department also attend seminars of domestic and foreign organizations such as gate Way to Viet Nam seminar by the SSI organization to disseminate information about PNJ to many big local and foreign investors. As the result, many big professional investors in Vietnam and abroad have learnt, visited and decided to become shareholders of the company.

Besides, the information on business results and other important information of PNJ are also updated in time to PNJ’s homepage www.pnj.com.vn, the media, hoSE websites... PNJ maintains providing information to investors via emails and phone calls.

More than 50 investors have visited and work with PNJ in 2010


62

ENTERPRISE’S CULTURE

ENTErPrISE’S CuLTurE

SOCIAL ACTIVITIESWith the business philosophy "PNJ put our customer and community’s benefits within the benefits of the enterprise", besides the production and business activities as well as the work of caring for the spiritual and material for all employees in the company, annually, PNJ also spends a lot of care for community activities such as arrange relief operations for natural disasters affected-people; Tet care for the poor; blood donation activities, health care for the poor, scholarships, financial aid programs to detect new talents, take care of poor children with disabilities, building houses of gratitude... with a total expenditure in 2010 was over 3.5 billion.

This is the shared sense of depth and humanity of the whole PNJ employees, showing a very high sense of responsibility towards the community and society.

Prestige and quality of products is our top priority.

human resource is our treasure, and making the best out of our hR is one of our most important tasks.

Creativity is encouraged and highly appreciated.

All employees are encouraged to improve their academic, professional and managerial skills through training courses both in-house and out-sourced. Their effort in improving their competence and contributing to the organization would be fairly awarded with bonuses, and promotion.

PNJ’S CULTURE AS “COMMON ROOF”


Production process following the

KPMg Limited

10th Floor, Sunwah Tower115 Nguyen hue StreetDistrict 1,ho Chi Minh CityVietnamTel: +84 8 3821 9266 Fax: +84 8 3821 9267www.kpmg.com.vn

66 INDEPENDENT auDITOr’S rEPOrT

INDEPENDENT AUDITOR’S REPORT

To the Shareholders

Phu Nhuan Jewelry Joint Stock Company and its subsidiaries

ScopeWe have audited the accompanying consolidated balance sheet of Phu Nhuan Jewelry Joint Stock Company and its subsidiaries (“the Group”) and the separate balance sheet of Phu Nhuan Jewelry Joint Stock Company (“the Company”) as of 31 December 2010 and the related statements of income, changes in equity and cash flows for the year then ended and the explanatory notes thereto which were authorise for issue by the Company’s management on 30 March 2011. These financial statements are the responsibility of the Company’s management. our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with Vietnamese Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance that the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

Audit opinionIn our opinion, the consolidated and separate financial statements give a true and fair view of the financial position of Phu Nhuan Jewelry Joint Stock Company and its subsidiaries as at 31 December 2009 and of their results of operations and their cash flows for the year then ended in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and the relevant statutory requirements.

COmPaNy OVErVIEW BOarD OF DIrECTOrS’ rEPOrT BuSINESS maNaGEmENTOPENING 67FINaNCIaL rEPOrTIndependent auditor’s reportExtracted control activity report of PNJ in 2010Financial report

Total deduction expenditure of dividends were

equal to 149.996.082.500 VND25%

68 ExTraCTED CONTrOL aCTIVITy rEPOrT OF PNJ IN 2010

EXTRACTED CONTROL ACTIVITIES REPORT OF PNJ IN 2010

In 2010, the situation of the world economy and the economy in Vietnam continue to face obstacles such as gold and foreign currency fluctuations, rising interest rates... These difficulties affect quite seriously to the production and sales of enterprises that do business on gold, silver and gemstone jewelry such as PNJ. however, the Board of Management, Board of Directors, and all of the entire staff of PNJ have made great efforts to achieve excellent business results as the analysis and evaluation mentioned above.

Besides, through the control and evaluation the activities of all aspects of PNJ, the Control Board has a number of recommendations to the Board of Management and the Board of Directors as follows:

Mobilization and use of funds: Currently, PNJ has been effectively exploiting financial •leverage and still control the risks. however, PNJ also plans to mobilize appropriate source of funds to balance the operating funds, which meet long-term investment needs, ensuring long-term and sustainable growth objectives of PNJ.

The stock market recently has many changes and may •also affects stock prices of PNJ. Therefore, when there is appropriate funds, Board should make consideration about the purchase of treasury shares at appropriate time and reasonable price to create stability in price of PNJ stocks and create peace of mind for investors.

About the organization, management and business operations:

In recent years, PNJ has expanded its operations in •many areas and also has many policies to improve and strengthen the organization and management. however, we respectfully request Board of Management and Board of Directors improve some more strategies in order to reinforce the appropriate income policy to avoid the labor changes, building trust for employees to make steady development together with PNJ. Also, the Board of Directors should develop training policies to encourage workers constantly improve their labor skills, building a team of skilled craftsmen with reputation and enthusiasm to donate more to the development of production of PNJ.

In 2010, PNJ continue to promote and focus investment •on retailing. Therefore, request Board of Management to continue looking for locations that have the advantage for business in the provinces / cities that PNJ is capable or has opened stores / branches in order to expand the business system. Besides, PNJ needs to make investment in building new factory in go Vap to help increase production capacity, creating tremendous growth opportunities in the following years.

Also, we propose Board of Directors has efficient •exploitation for the existing office after moving PNJ jewelry to new location.

At the present, PNJ continue the ERP implementation •project by collaboration with new partners as FBS (Phuong Bac Company) - this is a big project, need more time and is complex to implement and carry on for a large-scale enterprise as PNJ. In the opinion of the Control Board, a change in consultant and software provider as well as narrowing the scope of the project are in line with reality. however, it should accelerate the implementation and apply soon for a more efficient management of production.

Through analysis and evaluation of the Board of Control, •the rate of profit on revenue from the PNJ gold jewelry wholesale operations is very low (about 2%) compared with retail operations (more than 22.5%) , although the sales of wholesaling and retailing are equal. So kindly request the Board of Directors to adjust the construction of appropriate policies to improve profits from wholesale activities.

Above are the extracts of the Control Board report for the Annual general Meeting in 2011. By the way, the Control Board would also like to thank the Board of Management, the Board of Directors, the Divisions and Departments of PNJ has created good conditions for the Control Board to complete the tasks.

on behalf of Board of Supervisory

Truong Nguyen Thien KimHead of Board of Control


Total revenue increased

35.87%compared with 2009

70

FINANCIAL REPORT

FINaNCIaL rEPOrT

Phu Nhuan Jewelry Joint Stock Company and subsidiaries Consolidated Balance sheet for the year ended 31st December, 2010


Phu Nhuan Jewelry Joint Stock Company and subsidiaries Consolidated Balance sheet for the year ended 31st December, 2010 (continued)

72 FINaNCIaL rEPOrT



Prep

ared

by

Dan

g Th

i Lai

Chi

ef A

ccou

ntan

t

App

rove

d by

Cao

Thi

Ngo

c D

ung

Gen

eral

Dir

ecto

r


74 FINaNCIaL rEPOrT

Phu Nhuan Jewelry Joint Stock Company and subsidiaries Consolidated Statement of income for the year ended 31st December 2010

C

orpo

ratio

n C

ông

ty

C

ode

Not

e 20

10

VNĐ

20

09

VNĐ

20

10

VNĐ

20

09

VNĐ

To

tal r

even

ue

01

3 13

.798

.302

.596

.222

10

.290

.503

.190

.514

13

.077

.790

.334

.837

9.

625.

462.

675.

283

Le

ss s

ales

ded

uctio

ns

02

3 (4

5.92

1.93

0.52

6)

(34.

203.

428.

628)

(4

3.32

6.50

4.61

7)

(34.

161.

993.

758)

Net

sal

es

10

13

.752

.380

.665

.696

10

.256

.299

.761

.886

13

.034

.463

.830

.220

9.

591.

300.

681.

525

Cos

t of s

ales

11

3

(13.

210.

528.

300.

660)

(9

.755

.444

.424

.582

) (1

2.58

2.23

0.28

0.41

0)

(9.1

99.8

60.0

68.5

93)

Gro

ss p

rofit

20

541.

852.

365.

036

500.

855.

337.

304

452.

233.

549.

810

391.

440.

612.

932

Fina

ncia

l inc

ome

21

23

64.6

50.3

21.1

80

74.0

14.9

98.3

44

77.9

04.5

94.3

75

57.6

19.6

29.3

24

Fina

ncia

l exp

ense

s 22

24

(6

0.39

0.30

1.47

1)

(75.

807.

391.

931)

(5

5.41

0.40

7.23

1)

(65.

064.

285.

736)

Se

lling

exp

ense

s 24

(243

.304

.931

.356

) (1

85.5

12.9

85.8

06)

(166

.504

.109

.176

) (1

24.1

40.2

61.8

30)

Gen

eral

and

adm

inis

tratio

n ex

pens

es

25

(7

9.16

6.63

6.20

0)

(61.

079.

143.

055)

(6

0.11

8.48

9.52

1)

(41.

984.

654.

676)

Net

ope

ratin

g pr

ofit

30

22

3.64

0.81

7.18

9 25

2.47

0.81

4.85

6 24

8.10

5.13

8.25

7 21

7.87

1.04

0.01

4

Resu

lts o

f oth

er a

ctiv

ities

40

Oth

er in

com

e 31

25

30

.711

.526

.150

12

.101

.550

.024

21

.569

.250

.516

4.

150.

582.

716

Oth

er e

xpen

ses

32

26

(11.

902.

840.

151)

(1

.039

.248

.353

) (1

1.75

6.14

0.09

0)

(989

.665

.615

)

Shar

e of

pro

fit in

ass

ocia

tes

40

27

21.4

42.7

11.7

29

11.1

87.2

54.0

25

- -


Prep

ared

by

Dan

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ntan

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App

rove

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Cao

Thi

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Gen

eral

Dir

ecto

r

Phu Nhuan Jewelry Joint Stock Company and subsidiaries Consolidated Statement of income for the year ended 31st December 2010 (continued)

C

orpo

ratio

n C

ông

ty

C

ode

Not

e 20

10

VNĐ

20

09

VNĐ

20

10

VNĐ

20

09

VNĐ

Prof

it be

fore

tax

50

26

3.89

2.21

4.91

7 27

4.72

0.37

0.55

2 25

7.91

8.24

8.68

3 22

1.03

1.95

7.11

5

Inco

me

tax

expe

nse

- cur

rent

51

27

(5

1.94

6.70

9.71

5)

(54.

552.

299.

565)

(5

1.36

3.03

6.09

0)

(45.

738.

661.

952)

(Inc

ome

tax

(Exp

ense

)/be

nefit

- de

ferr

ed

52

27

(604

.159

.979

) (3

36.1

91.5

01)

- 38

0.37

8.85

8

Net

pro

fit

60

21

1.34

1.34

5.22

3 21

9.83

1.87

9.48

6 20

6.55

5.21

2.59

3 17

5.67

3.67

4.02

1

Att

ribu

tabl

e to

:

M

inor

ity in

tere

st

61

22

(676

.831

.791

) 15

.340

.366

.447

-

- Eq

uity

hol

ders

of t

he c

ompa

ny

62

21

2.01

8.17

7.01

4 20

4.49

1.51

3.03

9 20

6.55

5.21

2.59

3 17

5.67

3.67

4.02

1

Earn

ings

per

sha

re

Basi

c ea

rnin

gs p

er s

hare

70

28

3.

533

3.40

8 3.

443

2.92

8

76 FINaNCIaL rEPOrT

Phu Nhuan Jewelry Joint Stock Company and subsidiaries Consolidated Statement of changes in equity for the year ended 31st December 2010

Cor

pora

tion

Shar

e ca

pita

l VNĐ

C

apita

l sur

plus

VNĐ

Tr

easu

ry s

hare

s VNĐ

Inve

stm

ent a

nd

deve

lopm

ent f

unds

VNĐ

Fina

ncia

l re

serv

es

VNĐ

Reta

ined

pro

fits

VNĐ

To

tal

VNĐ

Bala

nce

at

1st Ja

nuar

y 20

09

300.

000.

000.

000

525.

000.

000.

000

- 31

.728

.284

.680

15

.449

.322

.840

21

.420

.892

.925

89

3.59

8.50

0.44

5

Bonu

s sh

ares

issu

ed

99.9

99.2

10.0

00

(99.

999.

210.

000)

-

- -

- -

Net

pro

fit fo

r the

yea

r -

- -

- -

204.

491.

513.

039

204.

491.

513.

039

Acq

uisi

tion

of tr

easu

ry

shar

es

- -

(7.0

90.0

00)

- -

- (7

.090

.000

) A

ppro

pria

tion

to e

quity

fu

nds

- -

- 21

.525

.003

.613

10

.363

.627

.186

(5

3.07

9.74

6.19

2)

(21.

191.

115.

393)

Fu

nds

trans

fer t

o re

tain

ed

prof

its

- -

- (4

25.3

37.2

74)

- 62

8.48

8.77

0 20

3.15

1.49

6 D

ivid

ends

-

- -

- -

(116

.998

.818

.000

) (1

16.9

98.8

18.0

00)

Util

izat

ion

of fu

nds

- -

- (1

29.0

24.0

65)

(5.8

50.0

00)

- (1

34.8

74.0

65)

App

ropr

iatio

n to

non

-ow

ner’s

equ

ity fu

nds

- -

- -

- (4

.117

.162

.734

) (4

.117

.162

.734

)

Redu

ctio

n by

ope

ratio

n di

spos

als

- -

- -

(102

.943

.449

) -

(102

.943

.449

)

Bala

nce

at

1st J

anua

ry 2

010

399.

999.

210.

000

425.

000.

790.

000

(7.0

90.0

00)

52.6

98.9

26.9

54

25.7

04.1

56.5

77

52.3

45.1

67.8

08

955.

741.

161.

339

Shar

e ca

pita

l VNĐ

C

apita

l sur

plus

VNĐ

Tr

easu

ry s

hare

s VNĐ

Inve

stm

ent a

nd

deve

lopm

ent f

unds

VNĐ

Fina

ncia

l re

serv

es

VNĐ

Reta

ined

pro

fits

VNĐ

To

tal

VNĐ

Bala

nce

at

1st Ja

nuar

y 20

10

399.

999.

210.

000

425.

000.

790.

000

(7.0

90.0

00)

52.6

98.9

26.9

54

25.7

04.1

56.5

77

52.3

45.1

67.8

08

955.

741.

161.

339

Bonu

s sh

ares

issu

ed

199.

992.

210.

000

(199

.992

.210

.000

) -

- -

- -

Net

pro

fit fo

r the

yea

r -

- -

- -

212.

018.

177.

014

212.

018.

177.

014

Acq

uisi

tion

of tr

easu

ry

shar

es

- -

- -

130.

509.

333

(75.

216.

879)

55

.292

.454

A

ppro

pria

tion

to e

quity

fu

nds

- -

- -

- (1

19.9

96.8

66.0

00)

(119

.996

.866

.000

) A

ppro

pria

tion

to n

on-

owne

r’s e

quity

fund

s -

- -

- -

(563

.517

.304

) (5

63.5

17.3

04)

Redu

ctio

n by

ope

ratio

n di

spos

als

-

- -

(237

.758

.378

) (1

30.5

09.3

33)

- (3

68.2

67.7

11)

Bala

nce

at 3

1st

Dec

embe

r 20

10

599.

991.

420.

000

225.

008.

580.

000

(7.0

90.0

00)

52.4

61.1

68.5

76

25.7

04.1

56.5

77

143.

727.

744.

639

1.04

6.88

5.97

9.79

2


Phu Nhuan Jewelry Joint Stock Company and subsidiaries Consolidated Statement of changes in equity for the year ended 31st December 2010 (continued)

Prep

ared

by

Dan

g Th

i Lai

Chi

ef A

ccou

ntan

t

App

rove

d by

Cao

Thi

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Gen

eral

Dir

ecto

r

C

ompa

ny

Sh

are

capi

tal

VNĐ

C

apita

l sur

plus

VNĐ

Tr

easu

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hare

s VNĐ

Inve

stm

ent a

nd

deve

lopm

ent f

unds

VNĐ

Fina

ncia

l re

serv

es

VNĐ

Reta

ined

pro

fits

VNĐ

To

tal

VNĐ

Bala

nce

at

2st J

anua

ry 2

009

300.

000.

000.

000

525.

000.

000.

000

- 31

.070

.897

.000

15

.120

.629

.000

18

.858

.200

.994

89

0.04

9.72

6.99

4

Bonu

s sh

ares

issu

ed

99.9

99.2

10.0

00

(99.

999.

210.

000)

-

- -

- -

Net

pro

fit fo

r the

yea

r -

- -

- -

175.

673.

674.

021

175.

673.

674.

021

Acq

uisi

tion

of tr

easu

ry

shar

es

- -

(7.0

90.0

00)

- -

- (7

.090

.000

)

App

ropr

iatio

n to

equ

ity

fund

s -

- -

- 9.

014.

875.

000

(36.

329.

501.

000)

(2

7.31

4.62

6.00

0)

Div

iden

ds

- -

- -

- (1

16.9

98.8

18.0

00)

(116

.998

.818

.000

) U

tiliz

atio

n of

rese

rved

fu

nds

-

- -

- (5

.850

.000

) -

(5.8

50.0

00)

App

ropr

iatio

n to

non

-ow

ner’s

equ

ity fu

nds

- -

- -

- (3

.285

.319

.000

) (3

.285

.319

.000

)

Bala

nce

at

1st Ja

nuar

y 20

10

399.

999.

210.

000

425.

000.

790.

000

(7.0

90.0

00)

31.0

70.8

97.0

00

24.1

29.6

54.0

00

37.9

18.2

37.0

15

918.

111.

698.

015

Sh

are

capi

tal

VNĐ

C

apita

l sur

plus

VNĐ

Tr

easu

ry s

hare

s VNĐ

Inve

stm

ent a

nd

deve

lopm

ent f

unds

VNĐ

Fina

ncia

l re

serv

es

VNĐ

Reta

ined

pro

fits

VNĐ

To

tal

VNĐ

Bala

nce

at

1st Ja

nuar

y 20

10

399.

999.

210.

000

425.

000.

790.

000

(7.0

90.0

00)

31.0

70.8

97.0

00

24.1

29.6

54.0

00

37.9

18.2

37.0

15

918.

111.

698.

015

Issu

ing

bonu

s sh

ares

19

9.99

2.21

0.00

0 (1

99.9

92.2

10.0

00)

- -

- -

-

Net

pro

fit fo

r the

yea

r -

- -

- -

206.

555.

212.

593

206.

555.

212.

593

Div

iden

ds

- -

- -

- (1

19.9

96.8

66.0

00)

(119

.996

.866

.000

)

Ba

lanc

e at

31

st D

ecem

ber

2010

59

9.99

1.42

0.00

0 22

5.00

8.58

0.00

0 (7

.090

.000

) 31

.070

.897

.000

24

.129

.654

.000

12

4.47

6.58

3.60

8 1.

004.

670.

044.

608

78 FINaNCIaL rEPOrT


C

orpo

ratio

n C

ompa

ny

C

ode

Not

e 20

10

VNĐ

20

09

VNĐ

20

10

VNĐ

20

09

VNĐ

CA

SH F

LOW

S FR

OM

OPE

RATI

NG

AC

TIV

ITIE

S

Prof

it be

fore

tax

01

26

3.89

2.21

4.91

7 27

4.72

0.37

0.55

2 25

7.91

8.24

8.68

3 22

1.03

1.95

7.11

5 A

djus

tmen

ts fo

r

D

epre

ciat

ion

and

amor

tisat

ion

02

43

.922

.848

.994

41

.018

.313

.453

15

.208

.211

.655

13

.172

.203

.112

Re

serv

es

03

57

.814

.791

2.

549.

400.

200

23.1

90.1

88

2.60

3.89

2.64

7 Lo

ss fr

om u

nrea

lised

fore

ign

exch

ange

04

- 22

.808

.291

.931

-

22.1

31.1

94.2

45

Inte

rest

from

fixe

d as

sets

liqu

idat

ion

05

(2

.544

.166

.131

) (2

01.7

36.5

40)

(2.5

44.1

66.1

31)

(213

.265

.540

) In

tere

st fr

om tr

ansf

er o

f ass

ets

to s

ubsi

diar

ies

05

-

- (2

.281

.408

.704

) (2

.281

.409

.000

) In

tere

st fr

om s

ecur

ities

inve

stm

ent

05

-

(25.

893.

396.

000)

-

(900

.000

.000

) In

tere

st fr

om s

ubsi

diar

ies

liqui

datio

n 05

(3.2

29.6

07.2

74)

(1.2

86.8

57.4

37)

(3.4

58.0

00.0

00)

(4.1

78.1

63.0

00)

Inco

me

from

dep

osits

inte

rest

and

div

iden

ds

05

(4

1.50

3.82

1.52

7)

(33.

929.

329.

028)

(5

5.96

2.74

9.17

2)

(41.

429.

423.

343)

In

vest

men

t ear

ning

s fro

m tr

ust f

unds

05

(15.

125.

454.

250)

(1

0.34

2.19

3.07

8)

(15.

125.

454.

250)

(1

0.34

2.19

3.07

8)

Prof

its fr

om a

ssoc

iatio

ns

05

(2

1.44

2.71

1.72

9)

(11.

187.

254.

025)

-

- In

tere

st e

xpen

se

06

58

.801

.093

.754

41

.421

.831

.862

53

.623

.329

.476

35

.701

.424

.763

Ope

ratin

g pr

ofit

befo

re c

hang

es in

wor

king

ca

pita

ls

08

28

2.82

8.21

1.54

5 29

9.67

7.44

1.89

0 24

7.40

1.20

1.74

5 23

5.29

6.21

7.92

1

C

hang

e in

rece

ivab

les

and

othe

r cur

rent

ass

ets

09

53

.293

.918

.839

(1

05.1

61.1

38.4

61)

61.0

39.3

32.9

36

(57.

575.

941.

699)

Cha

nge

in in

vent

orie

s 10

(261

.578

.272

.583

) (6

1.21

6.88

2.33

6)

(241

.675

.215

.458

) (5

9.98

3.36

3.94

1)

Cha

nge

in p

ayab

les

and

othe

r lia

bilit

ies

11

62.0

77.9

03.8

73

11.5

81.2

39.8

60

2.11

8.61

1.36

4 (1

6.37

8.69

6.02

8)

13

6.62

1.76

1.67

4 14

4.88

0.66

0.95

3 68

.883

.930

.587

10

1.35

8.21

6.25

3



C

orpo

ratio

n C

ompa

ny

C

ode

Not

e 20

10

VNĐ

20

09

VNĐ

20

10

VNĐ

20

09

VNĐ

In

tere

st p

aid

13

(5

8.31

9.33

0.50

7)

(39.

890.

584.

302)

(5

4.10

5.09

2.72

3)

(34.

043.

289.

288)

C

orpo

ratio

n in

com

e ta

x pa

id

14

(5

1.91

8.61

3.48

1)

(45.

712.

047.

230)

(4

2.34

7.21

2.40

9)

(41.

993.

107.

219)

O

ther

pay

men

ts fo

r ope

ratio

n ac

tiviti

es

16

(2

3.31

2.69

4.40

2)

(13.

743.

552.

956)

(2

1.36

1.46

2.17

7)

(11.

445.

997.

496)

Cas

h flo

ws

from

ope

ratin

g ac

tiviti

es

20

3.

071.

123.

284

45.5

34.4

76.4

65

(48.

929.

836.

722)

13

.875

.822

.250

CA

SH F

LOW

S FR

OM

INV

ESTI

NG

AC

TIV

ITIE

S

Pa

ymen

ts fo

r add

ition

s to

fixe

d as

sets

and

oth

er

long

-term

ass

ets

21

(1

12.3

61.9

91.9

85)

(102

.468

.852

.843

) (6

6.26

3.17

5.73

9)

(34.

007.

801.

836)

Pr

ocee

ds fr

om d

ispo

sals

of f

ixed

ass

ets

22

13

.571

.368

.595

75

1.50

0.00

0 13

.571

.368

.595

74

3.50

0.00

0 Pa

ymen

ts fo

r inv

estm

ent t

o ot

her c

ompa

nies

25

(217

.110

.697

.000

) (1

25.5

68.1

70.0

00)

(222

.337

.797

.000

) (1

12.8

24.8

81.0

00)

Paym

ents

for i

nves

tmen

ts in

oth

er e

ntiti

es

26

29

.675

.000

.000

59

.393

.497

.000

29

.675

.000

.000

5.

650.

000.

000

Rece

ipts

of i

nter

ests

and

div

iden

ds

27

51

.388

.081

.132

33

.929

.329

.028

55

.962

.749

.172

41

.429

.423

.343

Re

ceip

ts fr

om in

vest

men

ts to

trus

t fun

d 27

15.1

25.4

54.2

50

10.3

42.1

93.0

78

15.1

25.4

54.2

50

10.3

42.1

93.0

78

Dis

posa

l of b

usin

esse

s fo

r non

-cas

h co

nsid

erat

ions

16

.390

.530

.450

21

.137

.863

.351

20

.748

.000

.000

21

.450

.800

.000

Cas

h flo

ws

from

inve

stin

g ac

tiviti

es

30

(2

03.3

22.2

54.5

58)

(102

.482

.640

.386

) (1

53.5

18.4

00.7

22)

(67.

216.

766.

415)

80 FINaNCIaL rEPOrT

Prep

ared

by

Dan

g Th

i Lai

Chi

ef A

ccou

ntan

t

App

rove

d by

Cao

Thi

Ngo

c D

ung

Gen

eral

Dir

ecto

r


C

orpo

ratio

n C

ompa

ny

C

ode

Not

e 20

10

VNĐ

20

09

VNĐ

20

10

VNĐ

20

09

VNĐ

CA

SH F

LOW

FRO

M F

INA

NC

ING

AC

TIV

ITIE

S

Sh

are

repu

rcha

ses

31

-

(7.0

90.0

00)

- (7

.090

.000

) Pr

ocee

ds fr

om s

hort-

term

and

long

-term

bo

rrow

ings

33

6.59

9.95

5.89

4.69

9 3.

836.

446.

956.

347

6.51

5.65

2.19

4.69

9 3.

589.

602.

743.

108

Paym

ents

to s

ettle

deb

ts

34

(6

.254

.018

.176

.391

) (3

.613

.830

.205

.036

) (6

.160

.235

.898

.208

) (3

.386

.915

.781

.612

) Pa

ymen

ts o

f div

iden

ds to

min

ority

sha

reho

lder

s 35

(2.1

67.0

99.2

98)

(4.0

92.8

49.0

00)

- -

Paym

ents

of d

ivid

ends

36

(80.

716.

342.

550)

(9

6.91

1.09

1.00

0)

(80.

716.

342.

550)

(1

37.0

86.5

45.0

00)

Net

cas

h ge

nera

ted

from

fina

ncin

g ac

tiviti

es

40

26

3.05

4.27

6.46

0 12

1.60

5.72

1.31

1 27

4.69

9.95

3.94

1 65

.593

.326

.496

Net

cas

h flo

w d

urin

g th

e ye

ar

50

62

.803

.145

.186

64

.657

.557

.390

72

.251

.716

.497

52

.427

.836

.331

Cas

h an

d ca

sh e

quiv

alen

t at

the

begi

nnin

g of

the

year

60

4

274.

965.

948.

571

210.

458.

127.

512

244.

771.

724.

200

191.

816.

526.

514

Effe

cts

of e

xcha

nge

rate

fluc

tuat

ions

on

cash

an

d ca

sh e

quiv

alen

ts

61

-

(149

.736

.331

) -

527.

361.

355

Cas

h an

d ca

sh e

quiv

alen

ts a

t the

end

of t

he y

ear

70

4 33

7.76

9.09

3.75

7 27

4.96

5.94

8.57

1 31

7.02

3.44

0.69

7 24

4.77

1.72

4.20

0


Unlimited Dream

PHU NHUAN JEWELRY JOINT STOCK COMPANY170E Phan Dang Luu St – Ward 3 – Phu Nhuan District – hCM City

Telephone: 08.39951703 - Fax: 08.39951702

www.pnj.com.vn

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ANNUAL REPORT 2010 - PNJ · Place of issue: Department of Planning and Investment, ho Chi Minh City...

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