Supervisory Board report at 2013 AGM - Masan Group

MASAN GROUP CORPORATION
8 th Floor, Central Plaza, 17 Le Duan Street, District 1,
Ho Chi Minh City, Viet Nam.
Phone : (+84 8) 6256 3862
Facsimile : (+84 8) 3827 4115
Web : www.masangroup.com
ENGLISH TRANSLATION
REPORT OF THE SUPERVISORY BOARD
AT 2013 ANNUAL GENERAL MEETING SHAREHOLDERS
Dear Shareholders,
- Pursuant to the rights and responsibilities of the Supervisory Board provided in the Company’s
Charter;
- Pursuant to the 2012 consolidated financial statements of the Company audited by KPMG Company
Limited.
The Supervisory Board would like to report our activities in 2012 as follows:
I. Operations of the Supervisory Board in 2012
1. Supervising, checking the management and execution of 2012 business objectives by the Board of
Directors and the Management Board, checking the legality and reasonableness of our businesses in
2012 in accordance with resolutions of the General Meeting of Shareholders in 2011 and 2012.
2. Checking and supervising the issuing resolutions, decisions of the Board of Directors and the
Management Board.
3. Checking the reasonableness, legality, honesty and diligence in implementing accounting operations
and forming financial statements. Reviewing the Company’s 6-month financial statements and 2012
consolidated financial statements reviewed and audited by KPMG Company Limited.
In 2012, the Supervisory Board held its meetings, including the assessment of the accounting and financial
operations, business performance, governance and management of the Company for the first 6-month of
2012 and in relation to the resignation of Ms. Nguyen Thu Hien from the Supervisory Board. Like the
activities of the Board of Directors, members of the Supervisory Board were not compensated in their
capacity as members of the Supervisory Board, and the Supervisory Board did not incur any operational
expenses.
II.
The results of the Supervisory Board’s checking and monitoring of the Company’s operations
1. On the accounting and financial operations of the Company:
The Supervisory Board highly values the Company’s selection of KPMG Company Limited as our auditor.
The Company observed all requirements of current accounting standards and policies for Vietnam’s
businesses in organizing the financial-accounting function, performing accounting operations and preparing
all quarterly financial statements with accuracy, integrity and legality.
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The Supervisory Board confirms that the financial figures presented in the report of the Board of Directors to
the General Meeting of Shareholders are a fair reflection of the Company and relevant companies’ current
financial situation.
Key figures of the financial situation as of December 31, 2012:
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Part 1: Consolidated Balance Sheet
Group
Company
31/12/2012 31/12/2011 31/12/2012 31/12/2011
VND million VND million VND million VND million
ASSETS
Current assets 9,221,223 12,541,434 2,643,573 2,291,494
Cash and cash equivalents 5,718,717 9,573,593 2,160,026 1,510,736
Short-term investments 1,840,500 1,222,500 68,000 373,000
Accounts receivable 942,881 903,317 376,179 387,496
Inventories 563,855 612,845 - -
Long-term assets 29,478,033 21,031,185 23,197,560 22,289,000
Accounts receivable – long-term 23,158 - 1,658,406 2,762,294
Fixed assets 17,728,751 11,287,505 84,437 19,201
Long-term investments 11,313,619 9,321,085 21,423,058 19,490,421
Other long-term assets 412,505 422,595 31,659 17,084
TOTAL ASSETS (270 = 100 + 200) 38,699,256 33,572,619 25,841,133 24,580,494
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Group
Company
31/12/2012 31/12/2011 31/12/2012 31/12/2011
VND million VND million VND million VND million
RESOURCES
LIABILITIES 18,994,871 12,017,587 10,020,279 6,821,280
Current liabilities 4,748,364 3,625,783 473,329 3,237,125
Long-term borrowings and
liabilities 14,246,507 8,391,804 9,546,950 3,584,155
EQUITY 13,883,837 15,875,652 15,820,854 17,759,214
Owners’ equity 13,883,837 15,875,652 15,820,854 17,759,214
Share capital 6,872,801 5,152,723 6,872,801 5,152,723
Capital surplus 7,999,167 2,166,136 7,999,167 2,166,136
Other capital 1,721,824 10,462,804 1,721,824 10,462,804
Foreign exchange differences (16,128) (16,066) - -
Other reserves (8,619,479) (6,569,981) (530,235) -
Retained profits 5,925,652 4,680,036 (242,703) (22,449)
MINORITY INTERESTS 5,820,548 5,679,380 - -
TOTAL RESOURCES
38,699,256 33,572,619 25,841,133 24,580,494
2. On the Company’s business performance
On the back of success in the past several years, 2012 marked our new significant successes with the
following highlights:
Masan Consumer successfully partnered with Vinacafe to integrate our best-in-class operational
platforms and have realized significant synergies; Vinacafe delivered record financial results in
2012, growing revenue and net profit after tax by 33.4% and 41.3%, respectively.
The Company diversified into other attractive consumer-related sectors by acquiring a 40% stake in
Vietnam-French Cattle Feed JSC, the number two animal feed producer in Vietnam, which will
allow us to benefit from Vietnam’s growing protein-based diet.
Masan Resources spent approximately US$220 million over the course of the year to significantly
advance construction and began earthworks activities. The processing plant is expected to be
commissioned early in the second quarter of 2013, which is expected to make us the largest
operating tungsten producer outside of China.
Masan Resources secured an US$80 million loan from Standard Chartered to develop the Nui Phao
project, Vietnam’s first international loan facility for a private sector mining project.
The Company issued approximately US$130 million in convertible instruments to our existing
investors, the Richard Chandler Corporation and Mount Kellett, which demonstrates their continued
confidence in Masan Group.
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In 2012, the Supervisory Board did not find any abnormal signs in the Company’s business operations. All of
them were conducted in compliance with the Law on Enterprises, Law on Securities, the Company’s Charter
and other legal regulations.
Business performance results and accounting figures have been carefully checked to ensure the accuracy and
legality of accounting books.
The Company fully observed current legal regulations in information disclosure on the stock market.
Figures of business results as of December 31, 2012
Part 2: Consolidated income statement
Group
Company
2012 2011 2012 2011
VND million VND million VND million VND million
Total revenue 10,575,249 7,239,003 - -
-
Less sales deductions 185,835 182,154 - -
Net sales 10,389,414 7,056,849 - -
Cost of sales 6,178,926 3,997,834 - -
Gross profit 4,210,488 3,059,015 - -
Financial income 809,824 1,185,206 1,221,639 645,584
Financial expenses 309,385 347,725 1,325,744 717,657
Selling expenses 1,325,121 1,010,149 - -
General and administration expenses 727,529 406,374 258,602 150,487
Net operating profit/(loss)
2,658,277 2,479,973 (362,707) (222,560)
Results of other activities
168,043 (4,134) 142,453 (73)
Share of (loss)/profit in associates (337,798) 392,733 - -
Profit/(loss) before tax
2,488,522 2,868,572 (220,254) (222,633)
Income tax expense – current 650,509 247,114 - -
Income tax (benefit)/expense –
deferred
(124,579) 125,450 - -
Net profit/(loss) (carried forward
to next page) 1,962,592 2,496,008 (220,254) (222,633)
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Group
Company
2012 2011 2012 2011
VND million VND million VND million VND million
Net profit/(loss) (brought forward
from previous page)
1,962,592 2,496,008 (220,254) (222,633)
Attributable to:
Minority interests 702,074 522,859 - -
Equity holders of the Company 1,260,518 1,973,149 - -
Earnings per share
Basic earnings per share in VND 1,776 2,909 - -
Diluted earnings per share in VND 1,634 2,523 - -
3. On the governance and management
a. The Board of Directors:
The Supervisory Board opines that the Board of Directors fulfilled its responsibilities of management in
compliance with the Law on Enterprises, Law on Securities, the Company’s Charter, Resolutions of the
General Meeting of Shareholders and other legal regulations.
The Board of Directors has duly executed resolutions of the 2012 General Meeting of Shareholders.
The Board of Directors’ resolutions were issued in compliance with the legal authorities of the Board of
Directors and their contents were in compliance with the resolutions of the General Meeting of Shareholders,
and the Law on Enterprises, Law on Securities, the Company’s Charter, and other legal regulations.
b. The Management Board
The Supervisory Board opines that the Management Board has executed the Company’s business operations
highly efficiently and in compliance with the Board of Directors’ resolutions.
III.
Change of member of the Supervisory Board:
The Supervisory Board of the term 2009 – 2014 includes the following members: Mr. Nguyen
Quynh Lam, Ms. Nguyen Thu Hien and Mr. Dang Ngoc Ca. On January 2, 2013 the Company received the
resignation letter from Ms. Nguyen Thu Hien. Therefore the Supervisory Board proposes the 2013 Annual
General Meeting of Shareholders to approve the resignation of Ms. Nguyen Thu Hien and to appoint an
additional member of the Supervisory Board.
IV.
Conclusions and proposals
The Company’s operations during the last year were in compliance with the Law on Enterprises, Law on
Securities, the Company’s Charter and other legal regulations, and based on Resolutions of the General
Shareholders’ Meeting and of the Board of Directors. The information disclosure activities were in
compliance with legal regulations applicable to listed companies.
We wish the General Meeting great success.
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Ho Chi Minh City, April 11, 2013
O.B.H OF THE SUPERVISORY BOARD
HEAD
[signed and sealed]
NGUYEN QUYNH LAM
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APPENDIX A
SUPERVISORY BOARD MEETINGS IN 2012
No. Meeting minutes Main contents
1. Meeting minutes dated August 20,
2012
2. Meeting minutes dated January 2,
2013
Assessment of the accounting and financial operations,
business performance, governance and management of
the Company for the first 6-month of 2012.
Resignation of Ms. Nguyen Thu Hien from her
position as member of the Supervisory Board.
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