FINANCIAL STATEMENT ANALYSIS OF SAIGON BEER-ALCOHOL-

BEVERAGE CORPORATION (SABECO)

I. Overview of the assignment:
1. Objectives:
Corporate financial analysis is one of the most useful method, which helps the
investors make better choice. Through this, the investors not only understand general
industry of Sabeco but also consider detailed information of asset structure, capital
structure, operation efficiency, risk and business valuation. In this assignment, we use
the data from financial statement of Sabeco between 2016 and 2018. The investor can
rely on this report to decide whether to buy or sell stocks.
2. Method used in financial analysis: Comparative method:
- Comparative standard
- Techniques:
 Horizontal analysis (trend analysis) is the technique for evaluating a series of
financial statements data over a period of time.
 Vertical analysis (common-size analysis) is the technique that expressed each
financial statements item as a percent of a base amount.
3. Documents used in financial analysis:
- Financial statements:
 Balance sheeet
 Income statement
 Cash flow statement
 Notes to financial statements
- Other information: information about enterprise’s business characteristics

II. Introduction:
- Trade name : Sai Gon Beer — Alcohol — Beverage Corporation.
- Abbreviated name : SABECO.
- Chartered capital : 6,412,811,860,000 VND.
- Address : 187 Nguyen Chi Thanh, Ward 12, District 5, Ho Chi Minh City,
Vietnam. Business Registration Certificate : No. 0300583659 was initially
granted by the Department of Planning and Investment of Ho Chi Minh City on
April 17th, 2008 and amended for the 6th time on September 1st 2017.
- Business lines: manufacturing beer, alcohol and beverages.
- Logo:
 - Website: http://www.sabeco.com.vn
1. Overview:
Saigon Beer is leading brand name in Vietnam beer industry with about 140 years of
developing. Saigon Beer is recognized as National Brand and also honored to be the
351st member in Berlin Beer Academy – one of the cradle of global beer culture.
Vietnamese consumers are familiar with the brand: Saigon Beer (or Bia Saigon) of
Saigon Beer-Alcohol-Beverage Corporation (Sabeco). In 2017, Saigon Beer has been
over 142-year original history, 40-year brand building and development. Since that 142
milestone, the yellow beer bubbles flow has continuously kept up the future way, always
made Vietnamese proud of their products.
The unique taste of Saigon Beer is the inspiring taste combined with the spirit of
Saigonese’s generosity and the rich of the Southern land, making it an in dispensable
part of everyday life. With 2 bottle of 610 ml Larue bottle and 330 ml bottle of beer in
the first takeover period. Until now, Saigon beerhas developed 8 type of products such
as Saigon Lager 450 bottle, Saigon Export Beer bottle, Saigon Special bottle, Saigon
Lager 355 bottle, 333 Premium, 333 beer can, Saigon Special can, Saigon Lager can.
From a small production of 21.5 million liters in 1977, after 39 years of development,
by 2016, Saigon Beer has achieved 1.59 billion liters of output, striving to achieve 1.66
billion liters til 2017. Although the market has appeared many famous beer brands in
the world, Saigon Beer is still Vietnam's leading beer market in Vietnam, on the way to
conquer the markets such as Germany, the US, Japan, the Netherlands and so on.
2. History and Development:
On May 17th, 1977, the Minister of Food and Foodstuff issued a Decision No.
845/LTTP to establish Saigon Brewery. Later, pursuant to the Government's policy on
reorganization of the production and business in the state-owned economic sector, on
September 14th, 1993, the Minister of Ligh Industry issued the Decision No. 882/QD-
TCCB to rename Saigon Brewery to Saigon Beer Company.
On May 11th 2004, the Ministry of Industry (now the Ministry of Industry and
Trade) issued the Decision No. 37/2004/QD-BCN to transform Saigon Beer - Alcohol
- Beverage Corporation into a parent-subsidiary model. The parent company was
formed from the dependent Offices, Functional Departments, Factories and workshops.
On December 28th 2007, the Prime Ministry issued the Decision No. 1862/QD- TTg
approving the proposal of transforming Saigon Beer - Alcohol - Beverage Corporation
into a Joint Stock Company.
On April 7th 2008, Saigon Beer – Alcohol - Beverage Corporation sucessfully held
its first Annual General Meeting of Shareholders. On April 17th 2008, the corporation
was granted the business registration certificate for joint stock company.
On July 21th 2009, the State Securities Commission of Vietnam promulgated the
Official Letter No. 1473/UBCK-QLPH approving the registration of Saigon Beer -
Alcohol - Beverage Corporation as a public company.
On September 20th 2016, the Ministry of Industry and Trade issued an official
document No. 8845/BCT-CNN approving SABECO's registration for listing on
Hochiminh Stock Exchange. On October 20th 2016, SABECO's Annual General
Meeting of Shareholders promulgated a Resolution No. 62/2016/NQ-DHDCD
approving the listing of SABECO on Hochiminh Stock Exchange.
On November 25th 2016, the Hochiminh Stock Exchange issued a decision No.
470/QD-SGDHCM approving the listing of Saigon Beer — Alcohol — Beverage
Corporation on Hochiminh Stock Exchange.
3. Activity:
- The principle activites of Group are:
 To produce and sell beer, alcohol, beverages and related products
including materials and packaging materials
 To provide warehousing, logistics and transportation sevices
 To manufature machanical equipment, structural steel construction, and
mechanical equipment installation services
 To construct and provide real estates services
4. Vision & Mission:
- Vision 2015: To become a leading Corporation in the national beverage industry,
ranked in regional and international market.
- Mission:
 Develop Vietnam beverage industry to World standards.
 Appreciate Vietnamese cuisine culture.
 Advance the life quality through the provision of high quality, safe and
healthy beverage products.
 Bring the essential benefits to shareholders, customers, partners,
employees and society.
III. Strategy analysis
1. External factor
Environmental forces which include social, economic, technology, legal and political
has a significant effect on the development of company. Acknowledge these factors will
help business recognize the strength as well as the weakness that can occur during the
time running a business.
2. Social factor
Population and demographic such as age, gender, ethnicity, income and occupation
affect significantly on consumption of alcohol beverage especially beer industry. Cheer
for Vietnam ,Vietnam represent a prime market for beer producers. Unlike other
countries, the Vietnam have a tradition of drinking beer and express a strong loyalty to
their local brands, especially Saigon beer. In addition, Vietnam is the country which has
the large population. In 2014, Vietnam has a total population of 85 million. In there, the
rate of young people is high, 85 percentage of Vietnam's population are Boomers which
have high demand of beer consumption. Moreover, Vietnamese is affect much on
traditional, they not only drink beer at the Tet holiday, celebration or party but also
drink beer in the usual days, so the beer industry in Vietnam has more opportunity to
develop. However, because of the popular foreign products in Vietnam, for the high
society whose income is high, they prefer foreign products to domestic products.
Therefore, it is difficult for the domestic business compete with foreign brands.
3. Economic factor
2007, Vietnam joined WTO that will make Vietnam become well known and gain
high appreciate. Beside, the pressure of integration affects to the economic policies, and
state management and make operation more fluent. In addition, the international trade
is more easier because of the elimination of unreasonable barriers which restrict the
growth of businesses. Moreover, joining WTO contributes to the clean apparatus State
and improve the implementation of the economic policy in Vietnam efficiently to make
the system transparent policies. These factors will facilitate the attraction of foreign
investment in the sector.
Thanks to efforts for steady growth and effective investment strategies, SABECO is
now in top three of beers maker in whole southeast Asia and is the 21st largest beer
producer in whole world.
In addition, Vietnam is the country which has high total gross domestic product
around 8% in recent years. Although it experienced global recession in 2008 and 2009,
it is forecasted increase the grow rate in next 10 years. Moreover, according to Vietnam
general department, from 2013 the growth rate in Vietnam will continuously increase
with fast speed. It is seem as a opportunity for SABECO to develop its business.
Whereas, Vietnam has high inflation rate, it leads to the cost of production is high so
that it causes many difficulties for SABECO company and whole beer industry.
 4. Technology factor.
The development of science - technology has created the modern machinery,
materials richer and higher quality. For the SABECO company, it uses the HACCP-
hazard analysis critical control point system- to indentify the poison in nourishment.
The company has successfully implemented quality management system under ISO
9001 – 2008, ISO 1400 standards at all branches across the country.
5. Political and legal
To protect the domestic businesses, the Vietnam's government has applies some
policies and legal which will positive or negative effect on beer producers. Encouraging
foreign investment policy which will bring more condition for the foreign company
invest in beer industry. Foreign Investment Law and Law on Promotion of Domestic
Investment create favorable condition for all economic sectors invest in beer industry.
Decree No. 40/2008 / governmental decree provides for the manufacture and sales of
alcohol, which provide the basis standard for improving and controlling product quality
and strengthen control on investments, limiting the widespread development of wine
production facility. Therefore, the no named beer producers whose production cannot
reach the basic standards cannot survive in the market. However, according to Circular
No. 12/1999 provides for advertising, promotion, place Alcohol business, Regulation
on promotional advertising costs are 10% of sales which cause difficult for SABECO
promote their product. In addition, the policies on preventing of alcohol abuse and that
government may apply in the future, accompanied by strengthening propaganda and
education on the harmful effects of alcohol which can reduce the demand of beer.
6. Environmental factor
Vietnam is a area which have tropical climate and abundant mineral water source.
This is really a source of precious raw materials, creating favorable conditions for the
development of beer industry. Moreover, with hot and dry climate, the demand for beer
in Vietnam is huge. However, the natural conditions of Vietnam was not favorable for
the development of a number of raw materials. Especially in the brewing industry, the
main raw material barley and Houblon but both types are not suitable for the climatic
conditions Vietnam.

IV. Financial Statement Analysis Of Saigon Beer-Alcohol-Beverage

Corporation (Sabeco)
1. Asset tructure analysis:
a. Trend analysis – Horizontal analysis:
 ASSETS 2018 2017 2016 2018/2017 2017/2016

(Milion VND) (%) (Milion VND) (%)

2,971,981
A- CURRENT ASSETS 14,690,168 13,686,327 10,714,346 1,003,841 7.33% 27.74%
823,774
Cash and cash equivalents 4,467,392 4,268,599 3,444,825 198,793 4.66% 23.91%
3,384,480
Short-term financial investments 7,544,188 6,558,801 3,174,321 985,387 15.02% 106.62%
-374,807
Accounts receivable – short-term 765,631 715,326 1,090,133 50,305 7.03% -34.38%
-122,682
Inventories 1,813,754 2,003,535 2,126,217 -189,781 -9.47% -5.77%
-738,783
Other current assets 99,203 140,066 878,849 -40,863 -29.17% -84.06%

-151,157
B- LONG-TERM ASSETS 7,688,358 8,327,362 8,478,519 -639,004 -7.67% -1.78%
2,614
Accounts receivable – long-term 5,861 20,094 17,480 -14,233 -70.83% 14.95%
-454,494
Fixed assets 4,567,091 5,008,100 5,462,594 -441,009 -8.81% -8.32%
1,177
Investment property 54,568 67,658 66,481 -13,090 -19.35% 1.77%
213,687
Accounts receivable – long-term. 2,154,232 2,152,328 1,938,641 1,904 0.09% 11.02%
Long-term financial investments

TOTAL ASSETS 22,378,526 22,013,689 19,192,865 364,837 1.66% 2,820,824 14.70%

 According the table, the quantity of assets resourece in 2018 increased 364,837
miliion VND which compared to the quantity of assets resource in 2017 is 22,013,689.
This figures is corresponding to the percentage of increase is 1.66%. From 2016 to
2017, this items rose 2,820,824 million VND and it is corresponding to 14.70%.
Accounts receivable short-term item is significantly reduced between 2016 to 2017,
espeacially 34.38%. After the period, in 2018, this figures increased 7.03% which
compared to the quantity of accounts receivable short-term is 1,090,133 in 2016. The
fluctuation demonstrated that the company didn’t perform administration effectiveness
and debt collection. In addition, the board of director may also apply a credit sale policy
in order to intrigue the customers.
From 2016 to 2017, the proportion of inventory decreased 5.77% and also reduced
9.47% between 2017 and 2018. This revealed that the company has a sales policy
effectiveness and the quantity of inventory is not stagnant too much. However, with
this tendency, the stagnat of inventory may not sufficent to provide for customers when
market demand is quicky in high level. The company may lose the customers and the
competitors can get the market share.
Fixed assets item decreased gradually over the period time, the percentage of fixed
assets in 2017 compared to its figures in 2016 reduced 8.32%. This demonstrated that
fixed assets resource was majority old property and the company did not highlight in
investment and reconstruction of fixed assets. It may affect the capacity production and
the quality of product. In the next period time, the board of director should boost more
investment in fixed assets so as to increase the effectiveness of production activities and
develop stability.
b. Common-size analysis – Vertical analysis:

ITEMS 2017/201
2018 2017 2016 2018/2017 6

A- CURRENT ASSETS 65.68% 62.17% 55.82% 3.51% 6.35%

Cash and cash equivalents
19.97% 19.39% 17.95% 0.58% 1.44%
Short-term financial
investments 33.73% 29.79% 16.54% 3.94% 13.26%
Accounts receivable-short-
term 3.42% 3.25% 5.68% 0.17% -2.43%
Inventories 8.11% 9.10% 11.08% -0.99% -1.98%
Other current assets 0.44% 0.64% 4.58% -0.19% -3.94%

B- LONG-TERM
ASSETS 34.32% 37.83% 44.18% -3.51% -6.35%
 Accounts receivable – long-
term 0.03% 0.09% 0.09% -0.07% 0.00%
Fixed assets 20.42% 22.75% 28.46% -2.33% -5.71%
Investment property 0.24% 0.31% 0.35% -0.06% -0.04%
Long-term financial
investments 9.47% 9.78% 10.10% -0.30% -0.32%
100.00 100.00
TOTAL ASSETS
100.00% % %

Tỷ trọng tiền năm 2017 là 19.39% tăng 1.44% so với năm 2016. Từ năm 2017 đến
năm 2018 tỷ trọng này biên động rất nhỏ, tăng 0.28%. Nhìn chung, tỷ trọng tiền trong
cả 3 năm khá ổn, đảm bảo cho khả năng thanh toán tức thời các khoản nợ đến hạn.
Tỷ trọng tài sản ngắn hạn năm 2017 là 62.17% tăng 6.35% so với năm 2016. Tỷ trọng
này tăng là do vào năm 2017, tổng tài sản của Công ty tăng, tài sản ngắn hạn tăng trong
khi đó tài sản dài hạn giảm so với năm 2016. Tỷ trọng tài sản ngắn hạn 2018 là 65.68%
tăng 3.51% so với năm 2017. Tỷ trọng này tăng là do tài sản dài hạn của công ty giảm
đến 7,82%, tài sản ngắn hạn tăng 7.33%.
Tỷ trọng tài sản dài hạn năm 2017 là 37.83% giảm 6.35% so với năm 2016. Tỷ trọng
tài hạn năm 2018 là 34.32% giảm 3.51% so với năm 2016. Tỷ trọng tài sản dài hạn có
xu hướng giảm từ năm 2016 đến năm 2017.
Overall, the company's total assets did not change much over the years, they increase
by approximately 3 billion from 2016 to 2018. And we can see from the table, the
proportion of short-term assets is slight higher than the percentage of long-term assets.
The chart also shows that short-term assets only ranged from 55.82% to 65.68% and
long-term assets ranged from 44.18% to 34.32%. In particular, the cash and cash
equivalents had a slight fluctuation. Accounts receivable short-term decreased by 2.43%
from 2016 to 2017, while its index increased by 0.17 between 2017 to 2018. Besides,
there is a large fluctuation in other assets. Specifically, other assets changed nearly 4%
between 2016 to 2017. Additionally, inventories only changed slightly about 2% which
may be caused by production policies or production technology changes.
2. Resource structure analysis:
a. Trend analysis – Horizontal analysis:
 2018/2017 2017/2016

RESOURSES 2018 2017 2016

LIABILITY 6,254,837 7593163 6,759,685 -1,338,326 -17.63% 833,478 12.33%

Current liabilities 5,925,697 7401585 6,473,889 -1,475,888 -19.94% 927,696 14.33%

-
191,578 285,797
Long-term liabilities 329,140 137,562 71.80% -94,219 32.97%

EQUITY 16,111,906 14,420,526 12,433,180 1,691,380 11.73% 1,987,346 15.98%

Owner’s equity 6,412,812 6,412,812 6,412,812 0 0.00% 0 0.00%

Retained earnings 7,473,778 5,823,904 3,852,925 1,649,874 28.33% 1,970,979 51.16%

TOTAL RESOURSES 22,366,743 22,013,689 19,192,865 353,054 1.60% 2,820,824 14.70%

 According the table, from 2016 to 2018, the resources had the same fluctuation with
the assets resource. The figures of this item increased both in 2017 and 2018,
respectively 14.70% and 1.60%. From 2016 to 2017, the current liabilities item
decreased 19.94% and increased 14,33% between 2017 and 2018. This tendecy revealed
the company has paid short-term debts and reduced the pressure of payment. In 2017,
long-term liabilities item decreased 94,219 million VND corresponding to 32.97%
whlie this figures increased 136,726 million VND in 2018. It is a significant increasing
with 71,80%. The fluctuation in this period time seem seasonable because the company
had attention to expand production and business. Therefore, the short-term debt
reduction has shown the assurance of balancing the payment policy in the short term as
well as being suitable for long-term investment that must be financed from long-term
capital.
The equity item has a gradually increasing over the period time. The figures of this
item rose in 2017 and 2018, respectively 15.98% and 11.73%. It is corresponding to
1,987,346 million VND in 2017 and 1,691,380 million VND in 2018. Owner’s equity
didn’t change from 2016 to 2018 and it demonstrated that the increase of equity is
majority due to retained earnings increasing between 2016 and 2018. The retained
earnings item has a significant rising in both 2017 and 2018, respectively 51.16% and
28.33%. This tendency guaranteed company’s liquidity in order to respond the
unexpected situations as well as suitable for the expanding production and business.
b. Common-size analysis – Vertical analysis:

ITEMS 2018 2017 2016 2018/2017 2017/2016

LIABILITY 27.96% 34.49% 35.22% -6.53% -0.73%

Current liabilities 26.49% 33.62% 33.73% -7.13% -0.11%

Long-term liabilities 1.47% 0.87% 1.49% 0.60% -0.62%

EQUITY 72.04% 65.51% 64.78% 6.53% 0.73%

Owner’s equity 28.67% 29.13% 33.41% -0.46% -4.28%

Retained earnings 33.41% 26.46% 20.07% 6.96% 6.38%

TOTAL 100.00 100.00 100.00

RESOURSES % % %
 In 2018, the proportion of Current liabilities decreased 7.13% and declined slightly
0.11% in 2017. While the percentage of Long-term liabilities in 2017 has a slight
reducing 0.62% and increased slowly 0.60% in 2018. The fluctuation in this item
relevanted to the company's business expansion plan.
From 2016 to 2018, the percentage of owner’s equity maked up the majority of
resource, respectively 64,78%, 65,51% and 72,04%. It reveals the company has a high
financial autonomy and guarantees the liquidity of long-term debt.
In short, the proportion of owner’s equity and current liabilities have the inversely
fluctuation over the period time.
3. Analysis of funding stability:

Items
2018/2017 2017/2016
2018 2017 2016
total resources 22,366,743 22,013,689 19,192,866 353,054 2,820,823
current assets 14,690,168 13,686,327 10,714,346 1,003,841 2,971,981
long term assets 7,676,575 8,327,362 8,478,519 -650,787 -151,157
current liabilities 5,925,697 7,401,585 6,473,889 -1,475,888 927,696
equity 16,111,906 14,420,526 12,433,180 1,691,380 1,987,346
long term
191,578 285,797
liabilities 329,140 137,562 -94,219
Temporary
5,925,697 7,401,585 6,473,889
resources -1,475,888 927,696
Permanent
16,441,046 14,612,104 12,718,977
recources 1,828,942 1,893,127
Short-term
resources ratio 26.49% 33.62% 33.73% -7.13% -0.11%
Long-term
resources ratio 73.51% 66.38% 66.27% 7.13% 0.11%
Equity/Long-
term resources
ratio 98.00% 98.69% 97.75% -0.69% 0.94%
Self – fund ratio 72.04% 65.51% 64.78% 6.53% 0.73%

The larger the index, the greater the ownership capital of the company, the company
is in the healthy financial situation that will attract and create trust for the investors of
the company. The greater number the more self-control in the company's finances, the
more active of the company is in its finances, especially when it is needed. Sabeco has
a high index so its high autonomy.
 Self-fund ratio accounted for about 40% in 2015 and decreased by 4,16% until 2017.
This indicates that enterprise gradually lose its financial autonomy and had to borrowing
more money to fund for the business operation. Long-term resource ratio of company
also dropped from 40,84% to 36,68% in this period. That means that the funding
stability is steadily less stable
The short-term resources ratio is about one third of the company's total resources.
The index ranged from 27% to 34%. This index is gradually decreasing over the years,
in 2017 this index is higher than in previous years and remains in 2018.
Nguồn vốn ngắn hạn chiếm tỷ trọng khoảng 1/3 trông tổng nguồn vốn. Hệ số tài trợ
tạm thời trong năm 2016 là 0,34 lần xấp xỉ với năm 2017 nhưng đến năm 2018 giảm
còn 0.27 lần tương ứng với mức giảm 21.05%. Ngược lại, nguồn vốn tài trợ thường
xuyên chiếm tỷ trọng khá cao, khoảng 2/3 trong cơ cấu nguồn vốn. Hệ số tài trợ thường
xuyên năm 2018 tăng 10.66% so với năm 2017, giữa năm 2017 và 2016 hệ số này gần
như không có biến động.
Điểu này cũng dễ hiểu, bởi từ năm 2016 trọng tâm đầu tư của Sabeco tập trung vào
việc đầu tư chiều sâu, hiện đại hóa công nghệ và máy móc thiết bị và mở rộng công suất
một số Nhà máy trọng điểm như Nhà máy Bia Sài Gòn Nguyễn Chí Thanh và Nhà máy
Bia Sài Gòn Củ Chi. Cũng từ năm 2016, Sabeco thực hiện đầu tư mới máy đóng thùng
Wrap Around và triển khai việc chuyển đổi bao bì thùng giấy từ thùng RSC sang thùng
Wrap Around để giảm thiểu chi phí đóng gói, và gia tăng mỹ quan đối với hình ảnh và
chất lượng bao bì đối với các sản phẩm bia lon của Sabeco.
Hệ số tự tài trợ của Sabeco trong 3 năm qua đều ở mức khá cao lớn hơn 50% và tăng
dần qua các năm. Hệ số tự tài trợ năm 2018 tăng so với 2017 là 6.53% và năm 2017
tăng 2016 là 0.73%. Điều này thể hiện khả năng tự chủ của doanh nghiệp Sabeco ngày
càng lớn.
4. Long-term financial balance:
Net working capital = Current assets – Current liabilities
Net working capital = Permanent resource – Non-current assets

ITEMS 2018 2017 2016 2018/2017 2017/2016

(Million (%) (Million (%)

VND) VND)

current
14,690,168 13,686,327 10,714,346
assets 1,003,841 7.33 2,971,981 27.74

current
7,401,585 6,473,889
liabilities 5,925,697 -1,475,888 -19.94 927,696 14.33
 Net
working
capital 8,764,471 6,284,742 4,240,457 2,479,729 39.46 2,044,285 48.21

The net working capital were positive and increasing considerably throughout the
period. The index increased by 48.21% in 2017 and 39.46% in 2018 which indicates
that the permanent equity is enough to fund for the non-current assets and a few for
current assets, the company can reach the balance in the long-term funding. Positive
Net working capital can also be estimated that the company have the ability to grow
quickly. With its substantial net working capital due to large investment in current assets
, it may have enough resources to rapidly scale up the business. The incease of long-
term debt and owner’s equity demonstrates the higher of financial autonomy and
stimulates the effectiveness of financial leverage.
Vốn lưu động ròng qua cả 3 năm đều có mức dương và có xu hướng tăng lên qua các
năm mặc dù mức tăng năm 2018 so với 2017 nhỏ hơn mức tăng 2017 so với năm 2016.
Điều này cho thấy toàn bộ tài sản dài hạn của công ty được tài trợ bằng nguồn vôn
thường xuyên, tức là nguồn vốn thường xuyển của công ty không chỉ tài trợ cho tài sản
dài hạn mà còn tài trợ cho tài sản ngắn hạn. Gia tăng cả nợ dài hạn và vôn chủ sở hữu
cho thấy mức độ tự chủ của công ty cao hơn và phát huy được hiệu quả của đòn bẫy tài
chính.
Vốn lưu động ròng năm 2017 tăng 2,044,285 triệu đồng tương ứng với mức tăng
48%. Nguyên nhân tăng là do tài sản ngắn hạn tăng 2,971,981 triệu đồng trong khi đó
nợ ngắn hạn chỉ tăng 927,696 triệu đồng.
Vốn lưu động ròng năm 2018 tăng 2,479,729 triệu đồng so với năm 2017 là do tài
sản ngắn hạn tăng 1,003,841 triệu đồng trong khi đó nợ ngắn hạn giảm đến 1,475,888
triệu đồng.
5. Short-term financial balance:
Net working capital required = Inventories + Short-term accounts receivable
– Short-term accounts payable (not including bank loans)
Net fund = Net working capital – Net working capital required

Items 2018 2017 2016

Inventories 1,813,754 2,003,535 2,126,217

Short-term account
765,631 715,326 1,090,133
receivables

Short-term liabilities 5,925,697 7,401,585 6,473,889

 Short-term borrowings 594,243 722,904 1,042,310

Short-term liabilities
(excluding interest-bearing
short-term liabilities) 5,331,454 6,678,681 5,431,579

Net working capital required -2,752,069 -3,959,820 -2,215,229

Net working capital 8,764,471 6,284,742 4,240,457

Net Fund 11,516,540 10,244,562 6,455,686

Net working capital required had a fluctuation on the period time and but the net
working capital required was nagative so it shows a quite good signal.
Nhu cầu vôn lưu động ròng có sự biến động trong 3 năm: giảm từ năm 2016 đến năm
2017 và tăng từ năm 2017 đến năm 2018. Tuy nhiên, nhu cầu vốn lưu động ròng đều ở
mức âm, cho thấy đây là dấu hiệu khá tốt. Các khoản nợ tín dụng và nợ tích lũy dư sức
đảm bảo cho hàng tồn kho và khoản nợ phải thu.
Nhu cầu vốn lưu động ròng năm 2017 là - 3,959,820 triệu đồng, giảm 1,744,591 triệu
đồng so với năm 2016. Nguyên nhân giảm là do hàng tồn kho và khoản phải thu ngắn
hạn giảm trong khi Short-term liabilities (excluding interest-bearing
short-term liabilities) tăng.
Năm 2018, nhu cầu vốn lưu động ròng là -2,752,069 triệu đồng, tăng 1,207,751 triệu
đồng so với 2017. Nhu cầu vốn lưu động tăng do Short-term liabilities (excluding
interest-bearing short-term liabilities) giảm mạnh đến 1,347,227 triệu đồng.
Net fund was positive and had a tedency of increasing in the period time. Ngân
quỹ ròng trong cả 3 năm từ năm 2016 đến năm 2018 đều ở mức dương và có xu hướng
tăng lên. Ngân quỹ ròng dương cho thấy cân bằng tài chính của công ty ở mức độ an
toàn do công ty không cần phải đi vay để bù đắp Nhu cầu vốn lưu động ròng.
Ngân quỹ ròng tăng mạnh 3,788,876 triệu đồng từ năm 2016 đến năm 2017 là do vốn
lưu động ròng tăng trong khi đó nhu cầu vốn lưu động ròng ở mức âm và giảm 1,744,591
triệu đồng.
Tóm lại, Vốn lưu động ròng tăng và không phải bù đắp cho sự thiếu hụt của Nhu cầu
vốn lưu động ròng nên ngân quỹ ròng càng tăng.
6. The business performance analysis:
a. Analysis of assets use efficiency:
 2016 2017 2018

Total sales and revenues 31,356,350 34,805,639 36,660,641

(1)

Cost of good sold (2) 22,299,655 25,327,873 27,864,414

VAT output (10%) (3) 3,056,868 3,419,339 3,594,855

Average total assets (4) 14,989,542 20,604,219 22,190,216

Average historical cost 9,082,376 9,265,221 9,420,644

of fixed asset (5)

Average inventories (6) 2,024,312 2,068,949 1,908,645

Average customer 589,141 380,057 213,140

accounts receivable (7)

2017/2016 2018/2017
Items 2016 2017 2018
Assets use efficiency = -
2.09 1.69 1.65 -0.4 -0.04 -2.37%
(1)/(4) 19.14%
Inventories turnover =
11.02 12.2 14.6 1.22 11.07% 2.36 19.28%
(2)/(6)
Inventories turnover -
32.67 29.4 24.66 -3.26 -9.98% -4.75
period 16.15%
Customer accounts
receivable turnover 57.08 99 185.5 41.89 73.39% 86.56 87.46%
(10)=[(8) + (3)]/(7)
Customer Account
- -
Receivable period = 6.31 3.64 1.94 -2.67 -1.7
42.31% 46.70%
360/(10)
Fixed assets use
3.45 3.76 3.89 0.31 8.99% 0.13 3.46%
efficiency = (1)/(5)

Assets use efficiency:

In the period time, the assets use efficiency reduced significantly from 2.09 to 1.69,
between 2016 and 2017. It means that one asset could be generated 2.09 net sales and
revenue, after that, the index down 0.4. In 2018, the figures continues having a slight
decline 1.65, meaning that for each asset, this index earned 1.65 net revenue.
  Inventories turnover:
The inventories turnover increased dramtically over years, from 11.02 to 14.60, while
fixed assets use efficiency has a dramatic increasing between 3.45 and 3.89. It means
that each VND of fixed asset cost, net sales and revenue is 3.45 VND in 2016 and this
index increased fastly in 2017 and 2018. The figures peaked at 3.89 which means that
fixed asset price of one VND can generate 3.89 net sales and revenue. This
demonstrated that
 Customer receivables turnover:
The company showed a high customer receivables turnover ratio and it may suggest
that a company operates on a cash basis. From 2016 to 2018, the index has a dramatic
incresing from 57.08 to 185.53. It may also indicate that the company’s collection of
customer accounts receivable is efficient, and that the company has a high proportion
of quality customers that pay off their debts quickly. A high ratio can also suggest that
the company has a conservative policy regarding its extension of credit. Since the
receivables turnover ratio measures a business’ ability to efficiently collect its
receivables, it only makes sense that a higher ratio would be more favorable. Higher
ratios mean that companies are collecting their receivables more frequently throughout
the year. Higher efficiency is favorable from a cash flow standpoint as well. If company
can collect cash from customers sooner, it will be able to use that cash to pay bills and
other obligations sooner. Accounts receivable turnover also is and indication of the
quality of credit sales and receivables. It shows that credit sales are more likely to be
collected than a company with a lower ratio. Since accounts receivable are often posted
as collateral for loans, quality of receivables is important.
Customer account receivable periods were 6.31, 3.64 and 1.94 in 2016, 2017, 2018
respectively. This mean that the average customer takes about 7, 4 and 2 days to pay
his or her bills. If company had a 15-day policy for when payments should be made,
then the average accounts receivable turnover shows that the average customer makes
payments early.
b. Analysis of operating profitability:

2016 2017 2018

Total sales and revenues (1) 31,356,350 34,805,639 36,660,641

Average total assets (2) 14,989,542 20,604,219 22,190,216

Total operating expenses (3) 3,452,818 3,747,087 3,643,797

Interest expense (4) 68,665 25,806 74,635

Profit before tax (5) = (1)-(3)- 27,374,569 30,665,278 32,324,587

(4)
 Profit after tax (6) 4,517,344 4,948,600 4,402,750

Average Owner’s Equity (7) 12,261,453 13,358,231 15,266,216

2017/2016 2017/2016
Items 2016 2017 2018
ROS = (5)/(1) *
87.30% 88.10% 88.17%
100% 0.80% 0.07%
ROA = (5)/(2) *
18.26% 14.88% 14.57%
100% -3.38% -0.31%
RE = [(4) + (5)]/(2)
18.31% 14.90% 14.60%
* 100% -3.41% -0.30%
ROE = (6) / (7) *
36.84% 37.05% 28.84%
100% 0.21% -8.21%

 Return on sales:
From 2016 to 2017, return on sales (ROS) increased 0.8%, while in 2018, the figures
has a sligh rising. It shows that 88.17 VND of pre-tax profit will generate 100 VND of
sales and revenue. This is demonstrate that
 Return on assets:
From 2016 to 2017, return on assets (ROA) is dramatically decreasing from 18.26%
to 14.88%. It means that 100 VND of investment assets will generate 18.26 VND and
14.88 VND of pre-tax profit in 2016 and 2017 respectively. This is demonstrate that
RE eliminates the impact of funding policies, most clearly demonstrating the
efficiency of asset utilization without using debt - equity. RE is also compared with
interest rates to determine whether a company should borrow money from a bank or
raise equity from its owners. If RE> I (interest rate): increase debt, if RE <I: increase
equity.
This table shows that the rate of return on assets has decreased significantly from
18.31% to 14.90% between 2016 and 2017. From 2017 to 2018, the rate of return on
assets has declined by 0.3%. In short, although Sabeco's stock index has fluctuated over
the years, it remained stable and relatively high.
 Return on owner’s equity:
The table shows that the return on owner’s equity equity increased sharply from
36.84% to 37,05% in 2015-2016 and between 2016 and 2017, there was a dramatic
decline of 8.21% in the return on equity. It indicate refered that 100 VND of the owner’s
equity would genetare 28.84 VND of profit after tax in 2018.
 7. Risk analysis:
a. Analyzing short-term liquidity risk:
 Current liabilities coverage ratio:

The table decribes the curent liabilities coverage ratios in SABECO between
2016 and 2018. In general, all current liabilities coverage ratios fluctuated wildly during
this survey period.
As can be seen from the table, current ratio growing from 1.66 to 2.47 in the
2016-2018 period. Nonetheless, this ratio was more than 1(1 dong of current liabilities
is guaranteed by more 1 dong of current assets) leading to the assurance for resolvency
in short term. Beer production in 2016 and 2017 is high growth, but still only meet of
domestic beer demand and continue to be large trade deficit. As a result, Sabeco
increased its inventory of beer, Sabeco's short-term assets increased sharply because it
stockpiled inventories to meet rising consumer demand for beer during the year. In
general, this index of Sabeco is always high, so the current debt payment capacity of
Sabeco is high and secured for creditors. This index is good for the development of the
company.
Turning to the quick ratio, increasing substantially from 1.19 to 2.15 in the
2016-2018 period. This is demonstrate that Sabeco is committed to maintaining this
index as high as possible, which is a good indication of the Group's financial health.
For 3 years, Cash ratio of Sabeco is always less than 1, only 0.53 to 0.75 the
2017-2018 period because the characteristics of the beer industry is requires enterprises
to invest much in fixed assets so cash and cash equivalents is the lowest funds which
can only pay for essential needs, not enough to cover short-term debt. In general, this
index has reached the average level of the beer industry, which is still conducive to the
development of the Group.
 Working capital turnovers:

Items 2016 2017 2018

1. Sales 30,896,052 34,438,171 36,043,019

2.VAT output (10%) 3,089,605 3,443,817 3,604,301

 3.COGS 22,301,143 25,327,872 27,864,413

4. Inventories 2,126,217 2,003,535 1,813,754

5.Average inventories 2,024,312 2,068,949 1,908,645

6.Average A/R 1,119,290 921,693 753,457

7. Inventory turnover 11.02 12.24 14.6

= (3)/(5)

8. A/R turnover 30.36 41.1 52.62

= [(1)+(2)]/(6)

9. Days Inventory Held 33.12 29.82 25.00

= 365 / (7)

10. Days A/R 12.02 8.88 6.94

Outstanding
= 365/ (8)

The table decribes the working capital turnover in Sabeco between 2016 and 2018.As
can be seen from table, there is an increase in inventory turnover, from 11.02 times in
2016 to 14.6 times in 2018. It means that the business sold more products which results
in the faster speed of inventories rotation. Therefore, it helps company reduce expenses
that are associated with unsold products like storage costs. Besides, the days of
inventory turnover gradually declined over 3 years, reached 52 days in 2018 . This is a
positive trend for the business, which proves that company is quickly converting their
inventory into sales.
For Accounts receivable turnover, there was a markedly increase by 30.36 to 52.62
between 2016 and 2018. This figure indicates that the collection of receivables was
efficient. Shows that the capital appropriation of enterprises is reduced, credit policies
are tightened. In addition, Days of accounts receivable turnover decreased significantly
in 2018 compared to 2016. In details, Days of accounts receivable turnover in 2018 was
6 days. It means that the business was able to collect receivables averagely in 6 days
that year.
b. Analyzing long-term solvency risk:

Items 31/12/2016 31/12/2017 31/12/2018

1.Total liabilities 6,759,685 7,593,163 6,254,837
2. Owner’s equity 12,433,180 14,420,526 16,111,906
 3.Total assets = (1)+(2) 19,192,865 22,013,689 22,366,743

4.Long-term liability 285,797 191,578 329,140

5. Long-term resource = (2)+(4) 12,718,977 14,612,104 16,441,046
6. Profit before tax 27,374,569 30,665,278 32,324,587
7. Interest expense 68,665 25,806 74,635
8. EBIT = (6) + (7)
27,443,234 30,691,084 32,399,222

9. Liabilities to assets ratio = (1)/(3) 0.34 0.28

0.35
10. Liabilities to shareholder’s
0.53 0.39
Debt equity ratio = (1)/(2) 0.54
ratio 11. Long-term debt to long–term
0.02 0.01 0.02
capital ratio = (4)/(5)
12. Long-term debt to
0.02 0.01 0.02
shareholder’s equity ratio = (4)/(2)
13. Interest coverage ratio = (8)/(7) 399.67 1189.30 434.10

The table decribes the debt ratios and the interest coverage ratio in Sabeco between
2016 and 2018. Before increasing substantially to in the 2016-2017 period ,this ratio
fell considerably to in the 2017-2018 period. Especially, liabilities to assets ratio
decreased markedly from 1.18 to 0.98 during the 2017-2018 period. Because there was
a large payment for suppliers during this period. Others ratios also tended to decrease
during this survey. Capital structure of company was better.
After increasing dramatically to 1189.30, interest coverage ratio decreased by
434.10 from 2017 to 2018. In general, the long-term resolvency risk of this company
was low, in addition the likelihood of payment interest expense was good
c. Analyzing bankruptcy risk:

Items 2016 2017 2018

1. Net working capital 4240457 6284742 8749519

2. Retained earnings 3852925 5823904 7471336

3. EBIT 27443234 30691084 32399222

4. Sales 30896052 34438171 36043019

5. Total assets 19192865 22013689 22378526

 6. Owner's equity 6412812 6412812 6412812

7. Book value of totaliabilities 6759685 7593163 6268953

T1 = (1)/(5) 0.22 0.29 0.39

T2 = (2)/(5) 0.20 0.26 0.33

T3 = (3)/(5) 1.43 1.39 1.45

T4 = (6)/(7) 0.95 0.84 1.02

T5 = (4)/(5) 1.61 1.56 1.61

Z-score = 1.2XT1 + 1.4XT2 + 7.44 7.38 7.94

3.3XT3 + 0.6XT4 + 1.0XT5

Alman Zscore is used to predict the likelihood of a company bankruptcy . From the
table , we can see that in 2016 to 2018 , Z-score was more than 2,99, so the business is
predicted to be in "non-bankrupt sector".This is demonstrate that Sabeco is operation
good and strong growth.