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Vinamilk

vinamilk

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Vinamilk

  1. 1. 18 September 2013 P R I V A T E A N D C O N F I D E N T I A L
  2. 2. 1. Brief corporate profile 2. Group structure 3. Financial Highlights 4. Share capital structure 5. Production facilities 6. Cow farm developments 7. Key investment highlights 8. Five-Year Strategic CAPEX Plan 9. Updated financial performance 10. Q & A AGENDA:
  3. 3. “To become the leading Vietnamese trusted brand on nutrient and healthy products for human life” “Vinamilk commits to bring best-quality nutrition to communities that reflects our respect, love and responsibility for the people, life and society” VISION MISSION
  4. 4. CORE VALUES 1. Integrity: Integrity and transparency in actions and transactions. 2. Respect: To have self-respect and respecting colleagues, Company, partners. Tocooperate with respect. 3. Fairness: To be fair with employees, customers, suppliers and other parties. 4. Compliance: To comply with legal regulations and the Company’s Code of Conduct, regulations and policies. 5. Ethics: To respect the established ethical standards and act accordingly.
  5. 5. 5
  6. 6. 1. Brief Corporate Profile 1991-1994  Introduced UHT milk and spoon yoghurt to the Vietnam dairy market. 1976  Company was founded under the Southern Coffee Dairy Company name with 2 factories.  Launched condensed milk 1988- 1989  Dielac Powdered Milk Factory, the first powdered milk in Vietnam, came into operation and introduced its first batch of product. 2003  Company was formally converted into a joint stock company and renamed as Vietnam Dairy Products Joint Stock Company 2006  Company’s shares were listed on HOSE Today 2017 Total sales reaches US$3bn Become the World’s top 50 largest dairy products companies  No.1 dairy producer in Vietnam  The Region’s Top 200 best Small & Midsize Companies in Asia Pacific in 2010 (Forbes Asia)  Top 5 largest private companies in Vietnam  Own 19.3% stake of Miraka Limited, New Zealand
  7. 7. 2. Group Structure
  8. 8. 3. Financial Highlights ( in VND billion) 2008 2009 2010 2011 2012 CAGR Profit & loss Total revenue 8,381 10,820 16,081 22,071 27,102 34% Profit before tax 1,371 2,731 4,251 4,979 6,930 50% Profit after tax 1,249 2,376 3,616 4,218 5,819 47% Dividend per share Basic EPS (VND/share) 3,563 6,769 6,834 5,145 6,981 Dividend (VND/share) 3,900 2,000 5,000 3,000 4,000 Balance sheet Registered capital 1,753 3,513 3,531 5,561 8,340 48% Shareholders' equity 4,666 6,455 7,964 12,477 15,493 35% Total assets 5,967 8,482 10,773 15,583 19,698 35% Long term borrowings 22 12 - - - Net book value (VND/share) 26,619 18,378 22,556 22,437 18,577 Financial ratios % profit before tax/Revenue 16% 25% 26% 23% 26% % profit after tax/ Equity 28% 43% 50% 41% 42% % total debts/ Equity 28% 31% 35% 25% 27%
  9. 9. 3. Financial Highlights (continued…)
  10. 10. 4. Share Capital Structure As at 14 August 2013: - Share capital: 8,339 billion VND (~US$393m) - Market capitalization: ~ US$5.86 billion Listed on HOSE: Jan 2006 Vinamilk is highly sought after by foreign investors, proven by limited room left for foreign trading and significant out-performance against the index Trading performance (index is rebased to Vinamilk’s share price)
  11. 11. 4. Share Capital Structure Top 10 companies with the largest market capital in Vietnam Market price 13-Aug-13 Seq Sticker Outstanding shares Market capital in VND billion 1 GAS 1,895,000,000 68,000 128,860 2 VNM 833,490,871 147,000 122,523 3 CTG 3,266,144,348 19,000 62,057 4 MSN 705,140,873 88,000 62,052 5 VCB 2,317,417,076 26,600 61,643 6 VIC 882,459,899 65,000 57,360 7 BVH 680,471,434 41,200 28,035 8 STB 1,142,511,590 16,900 19,308 9 EIB 1,235,522,904 14,400 17,792 10 DMP 379,934,260 40,800 15,501
  12. 12. North  1 production factory  Tien Son  1 logistics enterprise  1 sales office – Hanoi Central  4 production factories  Nghe An  Binh Dinh  Thanh Hoa  Da Nang  1 sales office – Da Nang South  8 production factories  Thong Nhat  Truong Tho  Dielac 1 & 2  Mega factory  Saigonmilk  Can Tho  Beverage  1 logistics enterprise  1 healthcare branch  1 sales office – Can Tho City 5. Production Facilities As at 30 June 2013, we have 5,389 (2012: 5,000) employees nationwide.
  13. 13. 13 North Central South Central North South East  Vinamilk has currently 05 farms with the total of ~ 8,200 cows  Supply chain of milk: - Local supply from farmers: only raw fresh milk and ~ 25% of the total production demand. - Imports: only milk powders and ~75% of the total production demand. Imports are mainly from New Zealand, Australia and USA. 6. Cow Farm Developments
  14. 14. 7. Key Investment Highlights Vinamilk possesses the critical qualities to succeed: Leading market position in Vietnam’s fast-growing dairy market Diversified product portfolio Extensive sales and distribution network Strong “win-win” supplier relationship Strong market-oriented research and development capabilities, combined with modern production facilities Highly experienced management with proven track record Proven track record of robust financial growth 1 2 3 4 5 6 7
  15. 15. Presentation2 The Vietnamese dairy market exhibits strong growth potential… Vietnamese dairy product market sales (US$mm) CAGR = 11.8% Vietnamese fresh milk output (mt) CAGR = 18.9% Key drivers of the Vietnamese dairy product market Dairy sales growth 2010-2015E (%) Continued strong growth of GDP (targeted 7.0-7.5% growth in the next 5 years) and increasing disposable income Heightened desire for healthy living and greater demand for nutritional products Increased awareness of the health benefits of dairy products Supportive government programs encouraging the consumption of dairy products Source: Euromonitor International report 2009, Food and Agriculture Organization of the United Nations, GSO, DairyVietnam 1 5 52 48 37 16 24 32 China India Vietnam Indonesia Thailand Mexico US 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Per capita production of dairy products in 2010E (kilo) Source: Food and Agriculture Organization of the United Nations, DairyVietnam 665 698 877 980 1039 2005 2006 2007 2008 2009
  16. 16. …and we have established 1 ourselves as one of the leading dairy brands in Vietnam Achieved dominant market position through our focus on: Advertising and marketing Product innovation Quality assurance Received numerous prestigious awards… Vietnamese high quality product Strong brand, Trusted brand National Brand 2011-2012 One of the best annual report 2008-2012 The Region’s Top 200 best Small & midsize companies in Asia Pacific 2010 (by Forbes Asia) Top 5 largest private companies in Vietnam 2011 Top 50 companies with the best performance in VN Top 500 companies with the strongest growth in VN …on the back of well-defined business strategies Expansion of market share in existing and new markets Broaden consumer base while maintaining competitiveness in core products Development of raw material sources to ensure a reliable and consistent fresh milk supply base  Develop modern cow farms in Vietnam  Import cows from New Zealand, Australia and Thailand to increase the number of cows in Vinamilk’s farms  Develop cow farms overseas, e.g. Cambodia, New Zealand
  17. 17. Diverse product portfolio capturing a larger share of the consumer wallet Proves our market dominance in all core products of our diverse portfolio 2 Liquid milk Powdered milk Condensed milk  Contributed 22% of 2010 revenue  One of VNM’s core products since 1976  Market share: >80%  Competitors: Dutch Lady  Include fresh, pasturized and UHT milk  Main competitors: Dutch Lady 27%  Including Powdered milk and  8 lines Mama, Nutrition of products, including Dielac Dielac Alpha Powder and Dielac Sure  Market share: ~20%  Competitors:  Competitors: Abbott, Dutch MeadJohnson Lady, Abbott, MeadJohnson, Nutrifood, Dumex, Nestle  Our traditional products  Competitors: Dutch Lady
  18. 18. Diverse product portfolio capturing a larger share of the consumer wallet (cont’d) Proves our market dominance in all core products of our diverse portfolio 2 Spoon Yoghurt Cheese and ice cream Healthy beverages  Contributed 22% of 2010 revenue  One of VNM’s core products since 1976  Market share: >80%  Competitors: Dutch Lady  With various flavors  Main competitors: Dutch Lady 27%  Ice cream is offered with  8 lines Mama, various of products, including Dielac Dielac flavors Alpha and Dielac Sure  Market share: ~20%  Competitors:  Cheese Abbott, is produced MeadJohnson from French production line and has very high nutritious value  Main competitors: Kinh Do  A strong brand, which specializes in pure fruit juice, green tea, milk mixed fruit juice, soft drinks and soya-bean milk  Main competitors: Tan Hiep Phat, URC, Uni-president, Tribeco
  19. 19. Pro Beauty Yoghurt
  20. 20. NEW
  21. 21. We have developed one of Vietnam’s most extensive sales and distribution networks in the dairy industry A historically strong export business…  On average, approximately 15% of our revenue is generated from exports to 16 countries.  Key export markets are Middle East, Cambodia, Laos and Philippines … and the leading local distribution network 3 VVIINNAAMMIILLKK EXCLUSIVE DISTRIBUTORS RREETTAAIILLEERRSS SUPERMARKETS , METRO,… CONSUMERS/END USERS
  22. 22. Presentation2 Vinamilk gives… …and receives strong support from our suppliers  Steady supply of high quality raw milk  Substantial pricing power for Vinamilk  Consistent, fresh supply of raw milk 4 Strong “win-win” supplier relationship Competitive pricing policies Financial support to farmers  Purchases over approximately 50% -60% of domestically produced raw milk in Vietnam  Offer farmers seasonal subsidies when prices of raw milk experience sharp changes  Milk collection centers located within 30 minutes from farms Proximity of facilities Close relationships with suppliers allow us to maintain and increase production output
  23. 23. Strong marke 5 t-oriented product development capabilities…. Marketing team  Experienced in analyzing consumer preferences and trends  Conduct consumer research with market research companies Product R&D team  Dedicated R&D team of over 10 members  Committed to improve product quality and expand product portfolio.  Signed agreement with 3 leading companies named DSM, Lonza and Chr. Hansen for R&D for research, application and product development Sales team  Thorough understanding of consumer preferences through constant contact at various outlets Ability to develop new products based on evolving consumer preferences
  24. 24. 5 … combined with modern production facilities Production lines  Technologies imported from Germany, Italy, and Switzerland for manufacturing Packaging  Packaging technologies provided by Tetrapak, Bencopack and SIG Combibloc Spray drying  Spray dry technology produced by Niro Inc. Inventory management of Denmark  Retains high content of nutrients and minerals  ERP technology powered by Oracle manages inventory and minimizes spoilage loss Our state of the art facilities ensure high quality products
  25. 25. Highly experienced management with a proven track record of delivering strong business performance Core management team with extensive industry experience in Vietnam Solid platform and expertise to drive sustainable future growth 6 Vinamilk has a strong management team: CEO and 7 Executive Directors in charge of different areas, inclusive of Sales, Marketing, Finance, Production and R&D, Supply Chain, Raw Materials Development, Project. The management team has strong education background and industry experiences. Most of them have been growing with the Company for more than 20 years.
  26. 26. 759189-001 8. Five- Year Strategic CAPEX plan: In billion dong Total investment to 2016 Already paid Disbursement in 2013 Disbursement in 2014 - 2016 TOTAL 10,539 5,605 2,599 2,335 The CAPEX plan is mainly to increase the production capacity and develop dairy cow farms.
  27. 27. 759189-001 DIELAC 2 - (Powdered milk plant) Was put into operations since April 2013.
  28. 28. 759189-001
  29. 29. 759189-001 MEGA FACTORY- LIQUID MILK PLANT To be openned on 30 August 2013
  30. 30. 759189-001 8. Five- Year Strategic Business Plan (continued…)
  31. 31. 759189-001 9. Updated financial performance (audited): the first half 2013 % vs YEAR-TO-DATE ( in VND billion) 2013 2012 % increase/ (decrese) AGM' target Total sales 15,052 13,137 15% 46% Total profit before tax 4,114 3,370 22% 53% Net profit after tax 3,374 2,776 22% 54%
  32. 32. 759189-001
  33. 33. 759189-001 DISCLAIMER This presentation may contain forward-looking statements. Any such forward-looking statements are based on a number of assumptions about the operations of Vietnam Dairy Products Joint Stock Company (the “Company”) and factors beyond the Company’s control and are subject to significant risks and uncertainties, and accordingly, actual results may differ materially from these forward-looking statements. The Company undertakes no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such dates. The information in this presentation should be considered in the context of the circumstances prevailing at the time of its presentation and has not been, and will not be, updated to reflect material developments which may occur after the date of this presentation. The information is not intended to provide, and you may not rely on these materials as providing a complete or comprehensive analysis of the Company's financial or trading position or prospects. This presentation also contains information and statistics relating to the dairy industry and related industries. The Company has derived such information and data from unofficial sources, without independent verification. The Company cannot ensure that these sources have compiled such data and information on the same basis or with the same degree of accuracy or completeness as are found in other industries. You should not place undue reliance on statements in this presentation regarding the dairy and related industries. No representation or warranty, express or implied, is made as to, and no reliance should be place on, the fairness, accuracy, completeness or correctness of any information or opinion contained herein. None of the Company, any underwriter of securities of the Company, or any of their respective directors, officers, employees, agents or advisers shall be in any way responsible for the contents hereof, or shall be liable for any loss arising from use of the information contained in this presentation or otherwise arising in connection therewith.

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