1.

COMMENT:

- Total assets of enterprises tend to increase in 3 years

- Short-term assets account for a high proportion, over 50%, and tend to increase rapidly
from 2015 to 2017. Especially, in 2017, short-term assets reach appropriately 80%.
However, the reason for the increase of short-term assets mainly comes from short-term
receivables, the proportion of short-term receivables in 2016 increased by 31.5%
compared to 2015 (20.5%) and then slightly decreased by 7.2% in 2017. From that, we
can be seen that enterprises have high commercial credit, in addition, the cause may also
come from Industry characteristics of the business-the steel industry . So, the distribution
methods is wholesale and retail agents, the level of outstanding loans of each customer is
quite large. On the other hand, this can pose a risk to businesses about the ability of
customers to recover debts.
- Cash and cash equivalents, account for a very small proportion, especially the
proportion in 2 years 2016 and 2017 respectively 0.4% and 1.3%, this figures show that
the ability of quick payment of enterprises is very poor.

- Enterprise seems to focus only on the main business production of the enterprise, it is
reflected in the proportion of short-term financial investments in 2 years , 2015 and
2016, equal zero, but has a significant increase in 2017 is 13.4%.

- The proportion of inventories decreased continuously in 3 years, the proportion of

inventories accounted over 18%, this figure can come from the company's material
reserve policy (when the value of raw materials in the goods inventory always accounts
for more than 50% of total inventory value - notes to the financial statements).

- The proportion of fixed assets of enterprises has continuously decreased in 3 years, the
proportion of 2017 has dropped by more than 20% of the fixed assets ratio in 2015, this
shows that the production capacity of the company decreased. More than, the company
did not pay attention to invest new long-term asset (only accounted for 1%).

2.CAPITAL STRUCTURE

Year 2015 Year 2016 Year 2017

1. Liabilities 1,145,120,842,076 2,027,254,442,694 1,903,267,007,614
2. Owner’s equity 603,263,595,351 676,113,707,425 1,087,043,825,390
3. Temporary resources 1,145,120,842,076 2,027,254,442,694 1,903,267,007,614
4. Long term resource 603,263,595,351 676,113,707,425 1,087,043,825,390
5. Total resources 1,748,384,437,427 2,703,368,150,119 2,990,310,833,013
6. Debt ratio 65,5% 74,99% 64%
6. Self-fund ratio 34,5% 25,01% 36%
7. Short –term
resources ratio 65,5% 74,99% 64%
8. Long –term
resources ratio 34,5% 25,01% 36%
9. Owner’s equity/
Long –term resources
ratio 100% 100% 100%

COMMENT
- In 3 years, the debt ratio is always very high, the proportion is over 64% and
almost twice as much as the self-fund capital => Pressure to repay debt in the short
term is very large, company’ financial autonomy is low, capital used for business
activities is mainly a source of debt. However, this ratio tends to decrease from
74.99% (in 2016) to 64% (in 2017), this proves that enterprises have prospered in
financial autonomy.
- Enterprises do not have pressure to repay debt in long –term because enterprises
do not incurred long-term liabilities . Therefore, enterprises do not have financial
stability.

3.LONG – TERM FINANCIAL BALANCE

Year 2015 Year 2016 Year 2017

1. Long term resources 603,263,595,351 676,113,707,425 1,087,043,825,399

2.Owner' equity 603,263,595,351 676,113,707,425 1,087,043,825,399

3. Non-current assets 766,171,221,938 646,223,882,630 600,762,999,648

4.Net Working Capital -162,907,626,587 29,889,824,795 486,280,825,751

5.Long- term resources/ Non- 78.74% 104.63% 180.94%

current assets
6.Owner’equity/Non-current 78.74% 104.63% 180.94%
Assets
.

- Net working capital tends to increase rapidly in 3 years, increasing by more than VND
600 billion. From an financial imbalance in 2016, enterprises have achieved financial
balance in the long term in2017, net working capital reached 486,280, 825,751 VND

- From owner'equity / Non-current Assets status only reached 78.74% in 2015. In 2017 it
reached 180.94%, meaning that enterprises don’t need using short-term resource to fund
for longer term assets.However, the reason is that enterprises reduce investment in fixed
assets, as well as issue additional shares ( through notes to the financial statement), this
will affect the production capacity as well as complex management apparatus.

4.SHORT – TERM FINANCIAL BALANCE

Year 2015 Year 2016 Year 2017

1. Inventories 423,015,406,491 611,025,291,381 535,552,415,439

2. Short term account

357,900,947,192 1,406,320,756,832 1,338,981,753,930
receivable

3. Other current assets 13,859,323,560 29,450,461,677 77,043,083,742

4. Short term Liabilities

( excluding interest
135,270,593,990 601,805,372,032 684,246,941,930
bearing liabilities )

5. Net Working Capital 659,505,083,253 1,444,991,137,858 1,267,330,311,181

Requirement

6. Net Working Capital -162,907,626,587 29,889,824,795 486,280,825,751

7.Net Fund -822,412,709,840 -1,415,101,313,063 -781,049,485,430

COMMENT
- Net working capital requirements in huge numbers and rapid increases in 2016, up to
191% compared to 2015, and slightly decreased in 2017, demonstrating that enterprises
are being appropriated capital (This capital appropriation is mainly in short-term accounts
receivable).

- The net budget is negative, with a very high value of over VND 780 billion, the
company has to borrow money in the short term to meets the financing needs for daily
business activities (this is reflected through the short- term loans). Short-term loans of
businesses are always very large. However, the net fund has tended to increase in 2017,
compared to 2016 increased by more than VND 600 billion, which also shows a positive
change in the short-term financial balance of enterprises.