GROUP ASSIGNMENT COVER SHEET

STUDENT DETAILS

Student name: Huỳnh Nguyên Long Student ID number: B1112016570

Student name: Lê Viết Lượng Student ID number: B1121914091

Student name: Trương Nguyễn Phương Minh Student ID number: B1111914204

Student name: Nguyễn Trọng Nam Student ID number: B1112026398

Student name: Phạm Tú Nhi Student ID number: B1111915097

UNIT AND TUTORIAL DETAILS

Unit name: Corporate Finance Unit number: T121WSB-3

Tutorial/Lecture: Group 4 Class day and time: Friday 8:00 AM – 11:00 AM
Lecturer or Tutor name: Võ Hồng Đức

ASSIGNMENT DETAILS

Title: Financial Statement Analysis

Length: 4,050 words Due date: March 28th, 2021 Date submitted: March 28th, 2021
Video link: https://www.youtube.com/watch?v=Yz08Uez4uDs

DECLARATION
I hold a copy of this assignment if the original is lost or damaged.
I hereby certify that no part of this assignment or product has been copied from any other student’s work or from any
other source except where due acknowledgement is made in the assignment.
I hereby certify that no part of this assignment or product has been submitted by me in another (previous or
current) assessment, except where appropriately referenced, and with prior permission from the Lecturer / Tutor /
Unit Coordinator for this unit.
No part of the assignment/product has been written/ produced for me by any other person except where
collaboration has been authorised by the Lecturer / Tutor /Unit Coordinator concerned.

I am aware that this work may be reproduced and submitted to plagiarism detection software programs for the purpose
of detecting possible plagiarism (which may retain a copy on its database for future plagiarism checking).

Student’s signature: Huỳnh Nguyên Long

Student’s signature: Lê Viết Lượng
Student’s signature: Trương Nguyễn Phương Minh
Student’s signature: Nguyện Trọng Nam
Student’s signature: Phạm Tú Nhi

Note: An examiner or lecturer / tutor has the right to not mark this assignment if the above declaration has not been signed.

1
 TABLE OF CONTENTS

CONTENTS

INTRODUCTION ..................................................................................................................................................... 3

Membership of the company Board of Directors ...................................................................... 4

The majority-owned subsidiaries of ha long canfoco ................................................................ 4
BALANCE SHEET..................................................................................................................................................... 5

RATIO ANALYSIS .................................................................................................................................................... 9

Short-term Solvency (Liquidity Ratio) ...................................................................................... 11

Long-term Solvency (Financial Leverage Ratio) ........................................................................ 12
Asset Management (Turnover Ratio or Efficiency Ratio) .......................................................... 14
Profitability Ratio ...................................................................................................................... 15
Market Value Ratios ................................................................................................................. 16
CONCLUSION ........................................................................................................................................................ 18

REFERENCE ............................................................................................................................................................ 19

2
 Introduction

INTRODUCTION

Company name: Ha Long Canned Food Joint Stock Cooperation

Postal address: C3-4, C3-5, Thọ Quang Industrial Fisheries Service, Thọ Quang village,
Sơn Trà district, Đà Nẵng city
Internet address: http://www.canfoco.com.vn/

Ha Long Canned Food Joint Stock Cooperation (Halong Canfoco) was founded in 1957 in Hai Phong city, Vietnam.
With the vision and promise to provide best nutritional foods to build healthy and happy families and while
continuously expanding to be the leading food brand in Asia, the company is considered to be the pioneer in
the food processing industry of Vietnam. Ha Long Canfoco offers a wide variety of products distributed both
domestically and exported to markets including EU, Eastern Europe, North America, Japan, Australia, Middle
East and ASEAN countries. The company's primary lines of business consist of:
 Production and sales of canned, fresh, fast food, seafood
 Animal husbandry
 Joint ventures, ground rental
 Export of frozen foods, canned food
 Petroleum business, gas, liquefied gas
 Import of equipment, materials, chemicals, food technology.

Ha Long Canfoco ranks top 100 leading brands in Vietnam and takes pride as
being one of the few enterprises allowed to export canned food directly to
the EU market and has close relations with many other partners in the region
and around the world. Ha Long Canfoco has been consecutively voted by
consumers as "High Quality Vietnamese Goods" in recent years.

3
Introduction

The company's independent (external) audit firm is

Accounting and Auditing Consulting Services
Company Limited (AASC). Their list shares on the Ho
Chi Minh City Stock Exchange and their symbolic icon
is CAN.

MEMBERSHIP OF THE COMPANY BOARD OF DIRECTORS

1. Mr. Bui Quoc Hung - Selected as Chairman of the BOD

2. Mr. Kek Chin Ann - Selected as BOD member
3. Ms. Pham Thi Thu Nga - Selected as BOD member
4. Mr. Truong Sy Toan - Selected as BOD member since July 1, 2019 and resigned on October 25, 2019
5. Mr.Chua Seng Beng - Selected as BOD member since September 15, 2019.

THE MAJORITY-OWNED SUBSIDIARIES OF HA LONG CANFOCO

There are 2 subsidiaries operating independently:

1. Ha Long Canned Trade One Member LLC in Hai Phong
2. Ha Long Canned Food One Member LLC in Ho Chi Minh City

4
 Income Statement

BALANCE SHEET

Balance sheet
CAN
2017 2018 2019
Short-
term 155,842,898,402 70.80% 179,641,598,155 74.14% 237,802,602,225 81.05%
assets
Long-
term 64,279,613,461 29.20% 62,658,299,345 25.86% 55,592,871,529 18.95%
assets
Total
220,122,511,863 100.00% 242,299,897,500 100.00% 293,395,473,754 100.00%
assets
Liabilities 104,785,750,237 47.60% 134,384,594,979 55.46% 173,367,692,331 59.09%
Short-
term 98,429,933,884 44.72% 127,918,818,561 52.79% 169,412,869,235 57.74%
liabilities
Long-
term 6,355,816,363 2.89% 6,465,776,418 2.67% 3,954,823,096 1.35%
liabilities
Owner’s
115,336,761,626 52.40% 107,915,302,521 44.54% 120,027,781,423 40.91%
equity
Total
Liabilities
and 220,122,511,863 100.00% 242,299,897,500 100.00% 293,395,473,754 100.00%
Owner’s
equity
The table shows the amount and percentage of short-term assets, long-term assets, short-liabilities, long-term
liabilities in the Ha Long joint stock corporation balance sheet from 2017 to 2019

It can be seen that the short- term assets were slightly increasing as well as the percentage of it from 2017 to
2019. The short-term assets were highest in 2019, compared to both 2017 and 2018. Ha Long joint stock
corporation short-term assets in 2019 were more than 237 billion VND and it held 81,05% of the total assets.
This is nearly twice the amount of short-term assets in 2017 with 155 billion VND. In 2017, The percentage of
long-term assets was shortage because the percentage of short-term assets held was 70.80%. Furthermore, this
continues to happen in two year later causing a decreasing trend in long-term assets in three continuous years
as it loses around 3,34 percent, approximately 2 billion VND in 2018 and 10,25 percent, approximately 9 billion
VND in 2019 compared to 2017.

Ha Long joint stock corporation short-term liabilities in 2017 were recorded 98 billion VND that was worth nearly
45 percent compared to the total resources. While short-term liabilities in 2018, the number was increasing to

5
Income Statement

127 billion VND equal to 55,46 percent. In 2019, the number continues to rise to 173 billion VND that takes
nearly 58% percent of total liabilities and owner’s equity. On the other hand, the long-term liabilities reached a
peak in 2018 at 6.4 billion whereas the amount of it was 6.3 billion VND in 2017 and fell to a half around 3.9
billion VND in 2019. Despite the rise and fall in the amount of long-term liabilities, the percent of it was
decreasing year by year. The percent of long-term liabilities fell to a half in two year from 2,89% in 2017 to 1,35%
in 2019.

In 2017, the owner’s equity was 115 billion VND accounting for 52,40% of the total liabilities and owner’s equity.
In the next year, owner’s equity was decreasing to 107 billion VND and accounting for 44,54% in 2018. However,
the owner’s equity experienced an increase in amount of money equal to 120 billion but the percentage of
owner’s equity still fell to 40,91% in the last year. Although the percentage of owner’s equity is decreasing under
50% in the year 2018 and 2019, the amount of money still increases in 2019 compared to 2017.

COMPANY COMPARISON
Balance sheet
CAN
2017 2018 2019
Short-term assets 155,842,898,402 179,641,598,155 237,802,602,225
Long-term assets 64,279,613,461 62,658,299,345 55,592,871,529
Total assets 220,122,511,863 242,299,897,500 293,395,473,754
Liabilities 104,785,750,237 134,384,594,979 173,367,692,331
Short-term liabilities 98,429,933,884 127,918,818,561 169,412,869,235
Long-term liabilities 6,355,816,363 6,465,776,418 3,954,823,096
Owner’s equity 115,336,761,626 107,915,302,521 120,027,781,423
Total Liabilities and
220,122,511,863 242,299,897,500 293,395,473,754
Owner’s equity

Balance sheet
AAM
2017 2018 2019
short-term assets 196,300,575,712 185,331,960,146 185,708,953,316
Long-term assets 55,260,017,809 44,627,076,641 41,799,006,204
Total assets 251,560,593,521 229,959,036,787 227,507,959,520
Liabilities 10,603,590,916 18,279,981,958 16,092,542,851
Short-term liabilities 7,538,694,580 15,244,981,958 15,017,457,297
Long-term Liabilities 3,064,896,336 3,035,000,000 1,075,085,554
Owner’s equity 240,957,002,605 211,679,054,829 211,415,416,669
Total Liabilities and
251,560,593,521 229,959,036,787 227,507,959,520
Owner’s equity
The table shows the balance sheet of Mekong Seafood Joint Stock Company and Ha Long joint stock
corporation in the year 2017, 2018 and 2019.
6
Income Statement

In 2017, Mekong Fisheries Joint Stock corporation had more short-term assets than Ha Long joint stock
corporation. However, Ha Long corporation was valued 9 billion more in long-term assets, compared to Mekong
Fisheries. Moreover, Mekong Fisheries have the highest total assets with 251 billion VND in 2017. On the other
hand, Mekong Fisheries had less liabilities than Ha Long corporation. When subtracting the Ha Long with
Mekong Fisheries, Ha Long total liabilities still had more than 90 billion left. Furthermore, Mekong Fisheries
owner’s equity was estimated twice Ha Long owner’s equity around 240 billion VND. Different from 2017,
Mekong Fisheries assets and owner's equity had observed a decrease in 2018 that caused the total value of the
firm in 2018 to be decreased. This made the Mekong Fisheries to be the lowest corporation when compared
with Ha Long corporation. In the last year, it can be seen that Ha Long corporation had more total value than
Mekong Fisheries corporation but Mekong Fisheries still had the highest owner's equity. Additionally, the
Mekong Fisheries remain the high owner's equity and Ha Long corporation remain the liabilities and owner's
equity at around 50% for each in three years.

7
 Income Statement

INCOME STATEMENT

HA LONG’S CONSOLIDATED INCOME STATEMENT

Year ended 31 December 2019 2018 2017

Code VND VND VND

Revenue from sales of goods and rendering of
01 579,536,489,031 479,342,952,512 417,409,186,310
services
02 Less deductions (4,685,935,453) (2,691,613,462) (1,630,157,816)
Net revenue from sales of goods and rendering of
10 574,850,553,578 476,651,339,050 415,779,028,494
services
11 Cost of goods sold and services rendered (445,187,569,706) (371,018,654,033) (328,150,205,648)
Gross profit from sales of goods and rendering of
20 129,662,983,872 105,632,685,017 87,628,822,846
services
21 Financial income 1,307,669,623 5,909,004,558 1,685,731,849
22 Financial expenses (4,146,233,999) (1,486,865,278) 1,608,913,562
23 Including.' Interest expenses (3,429,446,715) (1,061,715,026) (864,102,564)
25 Selling expenses (80,159,294,628) (77,419,099,364) (55,105,111,643)
26 General and administration expenses (32,810,606,115) (34,857,769,913) 29,059,827,293
30 Net operating profit/(loss) 13,854,518,753 (2,222,044,980) 6,758,529,321
31 Other income 3,079,389,912 1,934,152,684 898,769,186
32 Other expenses (331,794,575) (555,590,237) (713,113,438)
40 Net other income 2,747,595,337 1,378,562,447 185,655,748
50 Net accounting profit(loss) before tax 16,602,114,090 (843,482,533) 6,944,185,069
51 Business income tax (”BIT") — current (1,989,635,188) (1,577,976,572) (1,403,340,570)
52 Business income tax — deferred 0 0 (430,675,609)
60 Net profit(loss) after tax 14,612,478,902 (2,421,459,105) 5,110,168,890

70 Basic earnings/(loss) per share 2,922 (484) 1,022

8
 Ratio Analysis

MEKONG'S CONSOLIDATED INCOME STATEMENT

Year ended 31 December 2,019 2018 2017
Code VND VND VND
1 Revenuers from sales and service rendered 225,542,898,242 219,916,892,024 225,795,571,644
2 Revenue deductions 9,420,961,893 1,653,001,976 1,606,384,800
3 Net revenues from sales and services rendered 216,121,936,349 218,263,890,048 224,189,186,844
4 Cost of goods sold 194,982,437,674 195,139,379,102 205,602,824,635
5 Gross revenues form sales and services rendered 21,139,498,675 23,124,510,946 18,586,362,209
6 Financial income 5,365,438,208 7,347,930,282 4,485,344,396
7 Financial expenses 135,959,609 312,510,941 (1,161,839,809)
in which: interest expenses (149,788,570) 0 0
8 Selling expenses 9,405,642,814 9,810,361,128 12,077,375,014
9 General administration expenses 9,863,117,856 9,717,449,618 8,407,367,160
10 Net profits from operating activities 7,100,216,604 10,632,119,541 3,748,804,240
11 Other income 3,236,837,475 1,355,076,542 62,716,688
12 Other expenses 71,875,231 75,816,657 2,636,147,420
13 Other profits 3,164,962,244 1,279,259,885 (2,573,430,732)
14 Net accounting profit before tax 10,265,178,848 11,911,379,426 1,175,373,508
15 Current corporate income tax expenses 1,718,235,596 2,548,062,623 61,763,690
16 Deferred corporate income tax expenses 238,103,096 (277,913,878) (17,988,268)
17 Profits after enterprise income tax 8,308,840,156 9,591,230,681 1,131,598,086
18 Basic earnings per share 700 881 95
19 Diluted earnings per share 700 881 95

This session is dedicated to presenting and comparing key financial statistics between Ha Long Canned Food
Joint Stock Corporation and its competitor, Mekong Fisheries Joint Stock Company. From the income statements
and annual financial reports available for the years 2019, 2018 and 2017, it is apparent that there are stark
differences between these companies. Firstly, in terms of operating revenues, Ha Long Canned Food registered
6,758,529,321 VND in 2017, which was reduced drastically in 2018, resulting in a loss of 2,222,044,980 VND,
before making a significant recovery with a profit of 13,854,518,753 VND the following year. Compared to
Mekong Fisheries, Ha Long had a commanding lead over their competitor, registering 80.285% and 95.128%
more operating revenues in 2017 and 2019, respectively. Mekong managed to outcompete Ha Long in 2018,
however, by generating an outstanding profit of 10,632,119,541 VND. Secondly, in regards to the cost of goods
sold, while Ha Long's figures were steadily rising over the years, going from 328,150,205,648 VND in 2017 to
445,187,569,706 VND 2 years later, Mekong's figures were moving in the opposite direction, signifying a
decrease from 205,602,824,635 VND to 194,982,437,674 VND during the same time period. Furthermore, an
analysis of the total amount of expenses before income taxes reveals that Ha Long Canned Food experienced
surging expenses in these years, from 29,028,129,733 VND in 2017 to 120,877,376,032 VND in 2019. On the
other hand, despite incurring much lower total expenses during this period compared to their competitor,
9
Ratio Analysis

Mekong Fisheries further reduced their figures with each passing year, from a high of 21,959,049,785 VND to a
low of 18,841,395,411 VND. It could be speculated that Mekong Fisheries, with their lower cost of goods sold
and total expenses figures, would be capable of operating more efficiently than Ha Long Canned Food with the
same sales performance, as according to the Operating Ratio. Moving onto the category of non-operating gains
or losses, which describes profits or losses from investments, Ha Long witnessed 2.3 times higher income from
non-business activities than Mekong, with figures being 4,311,813,532 VND for the former and 1,870,791,397
VND for the latter. Nevertheless, Mekong Fisheries’ figure for the year 2019 was 417,366,907 VND higher than
Ha Long Canned Food’s 2,747,595,337 VND, signaling potential for growth in the future. Finally, Ha Long had
fluctuating figures of earnings per common share, falling from a positive 1,022 VND in 2017 to a negative 484
VND the following year, then jumping to almost thrice of the aforementioned amount a year later, at 2,922 VND
per share. The leap coincided with a massive boost of more than 12 billion VND in net profit after tax for the
company that year. In the same time span, Mekong’s shareholders earned close to ten times more per share in
2018 than they did in 2017, with numbers of 95 VND and 881 VND respectively. With that being said, Mekong
also experienced a reduction of 181 VND earned per share the year after, an instability in earnings per share
growth which was indicative of a decline in net profit compared to the previous year.

10
 Ratio Analysis

RATIO ANALYSIS

Ratio analysis is an essential step in making investing decisions since it helps to determine financial strengths of
the targeted company. The six fundamental ratios had been used to analyze Ha Long’s financial health are short-
term solvency (or liquidity ratio), long-term solvency (or financial leverage ratio), asset management (or
turnover ratio), profitability ratio, and market value ratio.

SHORT-TERM SOLVENCY (LIQUIDITY RATIO)

HA LONG’S LIQUIDITY RATIO

Unit: Times 2019 2018 2017 Ha Long's Liquidity Ratio
2
Current ratio 1.40 1.40 1.58
1.5
Quick ratio 0.33 0.21 0.73
1
Cash ratio 0.08 0.06 0.49
0.5

0
2017 2018 2019

Current ratio Quick ratio Cash ratio

Mekong Frisheries' Liquidity Ratio

30
MEKONG’S LIQUIDITY RATIO
Unit: Times 2019 2018 2017 20

Current ratio 12.37 12.16 26.04 10

Quick ratio 4.92 7.88 19.76
0
Cash ratio 0.92 0.73 1.81 2017 2018 2019

Current ratio Quick ratio Cash ratio

Liquidity ratio analysis can be classified into three types of ratio including current ratio, quick ratio, and cash
ratio. These three ratios generally measure the company’s capability to cover short-term liabilities within a year.

As can be witnessed from the table above, the current ratio of Ha Long company remained a high number
despite there was a slight decrease from 2017 to 2019, which positively indicated that Ha Long has enough
financial resources to liquidate all of its short-term obligations. Besides, Ha Long’s index of quick ratio had
experienced a fluctuation in the period of 2017 and 2019. Despite the index had grown to 0.33 times in 2019, it
11
Ratio Analysis

was considerably less than that in 2017 (0.73 times, highest in the three-analyzing conservative years). However,
the outcomes of Ha Long’s quick ratio in three-year time were still considered lower than average. The indicator
has potentially implied a weak financial capacity to keep the company’s short-term dues in solvent with its more
liquid.

Moreover, when bringing into comparisons with Ha Long’s industry peers, both current ratio and quick ratio of
the corporate was nowhere near that of Mekong fisheries company. In specific, Mekong’s current ratio are
almost nine times higher than that of Ha Long in 2019 and 2018, 12.37 and 12.16 times respectively, which
evidently implied its larger current assets over the current liabilities. Although Mekong had seen a drop in both
ratio between 2017 and 2018, the rate remained its stable condition in 2019. Together with a high quick ratio
(higher than 1) in three conservative years, Mekong had strongly shown a potency of instantly paying its current
dues with the most liquid assets.

It can be easily seen that the cash ratio of both Ha Long and Mekong corporations appeared to be comparatively
unfavorable, except Mekong has reached the highest rate in 2017 (1.81 times). Such results obviously
demonstrated a lower amount of cash and cash equivalents over the company’s current liabilities.

LONG-TERM SOLVENCY (FINANCIAL LEVERAGE RATIO)

HA LONG’S FINANCIAL LEVERAGE RATIO MEKONG FISHERIES’ FINANCIAL LEVERAGE RATIO

Unit: percent
2019 2018 2017 2019 2018 2017
(%)
Total Debt 59.09
Ratio 55.46 47.60 7.07 7.95 4.22

Debt/Equity 144.44 124.53 90.85 7.61 8.64 4.40

Equity 244.44
Multiplier 224.53 190.85 107.61 108.64 104.40

Times Interest 5.84 0.21 9.04 69.53

Earned - -

Cash Coverage 7.82 6.45 17.81 71.13

- -

12
Ratio Analysis

Apart from measuring Ha Long’s ability to meet its short-term obligations, the assessment of the company’s
long-term solvency was considerately determined through various calculations of its financial leverage ratio.
Particularly, the total debt ratio of Ha Long company had witnessed a gradual growth from 2017 (47.60%) to
2019 (59.09%). Except for 2017, Ha Long’s debt-to-equity ratio was merely 90.85 which generally exhibited that
the corporation had more of its owners’ equity than liabilities. Within two year, the percentage of debt to equity
had risen by nearly 34% in 2018 (124.53%) and reached its highest point in 2019 – 144.44%. The fact of lending
more money for Ha Long’s business had led to an increase in the company’s equity multiplier, from 190.85% to
244.44% in the three-year time.

In contrast, Mekong always had a more moderate percentage of the total debt and debt-to-equity ratio. These
indicators probably implied that Mekong had a strong owners’ capital resources to sustain their operation, and
also meant the less money needed to pay for liabilities compared to Ha Long company. Having said so, Ha Long’s
total debt ratio was still considered safe for investors to venture their money.

With respect to time interest earned (TIE), although the calculation showed Ha Long’s incapability to keep its
interest expenses covered in 2018 (merely 0.21 times), TIE ratio of the company appeared to be acceptable in
2017 and 2019 (9.04 and 5.84 times, correspondingly). Likewise, the cash coverage rate of Ha Long corporation,
though experiencing a significant decline from 2017 to 2018, still remained stable in the following 2-year time.

It can also be noted from the table that both Mekong’s TIE and cash coverage ratio were substantially greater
than that of Ha Long company. Especially, the cash coverage ratio of Mekong company was approximately 71.13
times, which meant the company had a huge amount of cash available for paying off all of its interest expenses.

13
Ratio Analysis

ASSET MANAGEMENT (TURNOVER RATIO OR EFFICIENCY RATIO)

HA LONG MEKONG

(Unit) 2019 2018 2017 2019 2018 2017

Inventory Turnover
2.65 3.13 3.46 2.20 3.47 2.86
(Times)
Days’ Sales in 138 117 105 166 105 128
Inventory (Days)
Receivables 22.39 33.13 17.19 10.84 10.37 11.89
Turnover (Times)
Days’ Sales in 16 11 21 34 35 31
Receivables (Days)
Total Asset 2.15 2.06 1.88 1.02 0.96 0.92
Turnover (Times)

Efficiency ratio is also one of the most important indicators to be assessed in order to determine a company’s
financial health. it can be observed that the rate of Ha Long’s inventory turnover had suffered a slow decrease
in the 2017-2019 period. Compared to Mekong, nevertheless, the turnover rate of Ha Long’s inventory was
generally higher in the three conservative years, except in 2017 – Mekong’s inventory turnover was slightly
higher (3.47 times). The more rapid inventory turnover ratio, the less days’ sales in inventory the two companies
would have. Despite Ha Long needed up to 138 days to sell off all of its inventories in 2019, the number of days
was 38 days faster than Mekong company (166 days in 2019).

When it comes to receivables turnover ratio, Ha Long had shown its strength in collecting all of the company’s
receivables compared to Mekong. Specifically, the longest number of days it took Ha Long to collect receivables
from customers were merely 21 days in 2017, which was 10 days sooner than the fastest period for Mekong to
be paid (31 days in 2017). The highest receivables turnover of Ha Long to be recorded was 33.13 times in 2018
– which was higher than that of Mekong in the same period (10.37 times). Such outcomes had indicated that Ha
Long was more efficient in collecting the company’s receivables than its peer – Mekong corporate.

14
Ratio Analysis

This line chart shown the total asset turnover rate of Ha

TOTAL ASSET TURNOVER
Long and Mekong company. In general, Ha Long
2017 - 2019
remained a considerably higher rate of asset turnover
2.5
than Mekong in three-year time despite Mekong
2
corporate had experienced a slight increase in 2018. It
1.5
can also be mentioned that Ha Long’s total asset
1
turnover was less likely to be lower than 1, which
0.5
possibly indicated that the company had efficiently
0
utilized its assets to generate sales – at least when
2017 2018 2019
being compared with its peer, Mekong corporation.
Ha Long Mekong

PROFITABILITY RATIO

HA LONG PROFITABILITY RATIO MEKONG FISHERIES PROFITABILITY RATIO

Unit: percent
2019 2018 2017 2019 2018 2017
(%)
-0.51 1.23
Profit margin 2.54 3.84 4.39 0.50

ROA 5.66 -1.00 2.32 3.65 4.17 0.45

ROE 12.17 -2.24 4.43 3.93 4.53 0.47

EBITDA margin 4.66 1.44 3.70 6.83 7.39 2.21

As the name suggests, profitability ratio measures the ability of a company can generate profits from sales. In
overall, the percentage of Ha Long’s profit margin was relatively moderate from 2017 to 2019, at least compared
to that of Mekong company. Significantly in 2018, the company had suffered from a loss for -0.51 percent of its
generated profits from sales. Nonetheless, such ratio had been instantly recovered and exceeded the record in
2017 within a year after – 2.54% in 2019. In 2017, Mekong’s profit margin rate was around 0.5% less than that
of Ha Long (1.23%); however, the generated profits by sales had experienced a marked growth in 2018 – nearly
4.39%, which substantially went over Ha Long’s profit margin.

15
Ratio Analysis

Regarding the matter of utilizing assets efficiently, though Ha Long company had shown a negative ROA
percentage (-1.00%) in 2018, the proportion of return-on-asset markedly increased in 2019 and became the
highest record in three conservative years – 5.66% in specific. Despite Mekong had a reasonably stable rate of
return on asset, the highest record of such statistic was just around 4.17% (2017) which was still moderately
less than Ha Long’s greatest percentage documented in 2019. That says Ha Long had utilized its assets more
efficiently to generate more profits. Per a VND it had invested, the transformation of money into profits
accounted for up to 5.66% (2019).

Similarly, yet experiencing from a loss of return on equity in 2018 (-2.24%), Ha Long’s ROE percentage had
drastically grown by nearly 14.4% in 2019 (12.17%), which was approximately four times that of Mekong in the
same period. Such an increase in ROE ratio probably demonstrated that Ha Long had efficiently utilized its
investors’ capital to generate profits.

Besides, the EBITDA margin generally reflects the efficiency of the company’s operational activities in the
absence of noncash expenses (depreciation and amortization). In overall, the EBITDA margin of Ha Long
corporate in three-year times was rationally desirable. Especially in 2019, the percentage of EBITDA margin
notably rose by 3.22%, higher than the recorded data in 2017 (3.7%). Even with the greatest EBITDA ration in
2019, Ha Long’s operational performance turned out to be less effective when being put on par with that of
Mekong company (4.66% against 6.83%).

MARKET VALUE RATIOS

HA LONG MARKET VALUE RATIO MEKONG FISHERIES MARKET VALUE RATIO

Unit: percent 2019 2018 2017 2019 2018 2017

(%)
Trailing EPS 2,923 -484 1,022 851 980 114

PE ratio 7.49 -46.67 28.37 90.88 13.67 15.04

It is hard to deny that a company’s market value remarkably reflects its status in the economy, which essentially
necessary when it comes to business assessment. As settled by Finance Vietstock (2021), the trailing EPS of Ha
Long company had crucially grown from 2018 to 2019, -484 and 2,923 respectively, which was approximately

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Ratio Analysis

three times greater than the highest Mekong’s trailing EPS (980 in 2018). It can also be noted from the table
that, compared to Ha Long company, Mekong had built a more stable profit condition from their outstanding
shares of stock since its EPS’s fluctuations seemed to be trivial in three-year periods. Speaking of PE ratio, Ha
Long’ PE ratio was comparatively outstanding in 2017 (28.37 times) as opposed to the record in 2018, merely -
46.67 times suggesting a significantly low profitability and market value. Fortunately, the company had
witnessed a great price-to-earning recovery in 2019 (7.49 times). Despite the price-to-earning fraction of Ha
Long company had notably regained in 2019, its value was nowhere near that of Mekong – 90.88 times in 2019
which explicit a fairly high expectations from investors of Mekong’s value in the economy.

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 Conclusion

CONCLUSION

In summary, the result of Ha Long's quick ratio in the past 3 years is still underestimated in comparison with the
average benchmark while the proportion of cash in the company also proved to be relatively unfavorable. The
analyzed efficiency coefficient indicates that the inventory turnover rate of Ha Long Canfoco slowed down in the
period 2017-2019. On the contrary, Ha Long has shown its strength in its full recovery of receivables compared
to its peers. The assessment of long-term solvency shows that Ha Long Canfoco's total debt ratio is still
considered safe for venture capital investors to pour money into. Although the company's cash coverage ratio
has decreased significantly from 2017 to 2018, it will remain stable over the next 2 years. Apparently, the
company still has a huge amount of cash left to pay off interest. Through analysis of the profit margin of Ha Long
makes clear that Ha Long has used assets more efficiently to generate more profits. Looking at Ha Long's market
value proves that the Company has witnessed a significant recovery, which resulted from effective usage and
mobilization of capital from investors to create profits.

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 Reference

REFERENCE

Báo cáo tài chính năm tài chính kết thúc ngày 31 tháng 12 năm 2017. (2018). VietstockFinance.
https://finance.vietstock.vn/AAM/documents.htm?doctype=1&fbclid=IwAR2JVTBWf7FMT5hY2g0_8
N5MTN2wGgT4x6MbeNi_MLsrYu_T92YtZrMYVuI
Báo cáo tài chính năm tài chính kết thúc ngày 31 tháng 12 năm 2018. (2019). VietstockFinance.
https://finance.vietstock.vn/AAM/documents.htm?doctype=1&fbclid=IwAR2JVTBWf7FMT5hY2g0_8
N5MTN2wGgT4x6MbeNi_MLsrYu_T92YtZrMYVuI
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https://www.mediafire.com/file/gc0j1ej775l17aq/Consolidate_Financial_Statement_2018_-
_ENG.pdf/file
Consolidated financial statements for the year ended 31 december 2019. (2020, March). Ha Long Canned
Food Joint Stock Corporation.
https://www.mediafire.com/file/qiaxvoz8qc62e1t/CONSOLIDATED_2019_FINANCIAL_STATEMENT_
-_ENG_signed.pdf/file
Ha Long Canfoco. (n.d.). CAN: CTCP Đồ hộp Hạ Long - HALONG CANFOCO - Tài chính. VietstockFinance.
Retrieved March 24, 2021, from https://finance.vietstock.vn/CAN/financials.htm?tab=CSTC
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