Pnj’s finance group assignment fin202 pnj company, formerly known as jewelry store, phu nhuan district

DIFFERENT CREATION PENSION Over 33 years of establishment and development, PNJ has achieved many remarkable achievements: being in the Top 500 leading retailers in the Asia Pacific, Asia

Group Assignment FIN202 TEAM 3

Digital Marketing (mkt308)

PNJ’S FINANCE

GROUP MEMBERS: 1 NGUYEN SON TUNG HS120529 –

2 LE THI MY DUYEN HS150531 –

3 LO DUY TUNG HS153072 –

4 DINH PHUONG NGA HS150244 –

5 DAO MANH HIEU HS153198 –

CLASS: IB1602

LECTURER: HOANG VAN TUONG

TABLE OF CONTENTS

1 Introduction………2

2 Financial statements……….4

3 Financial ratios………8

3.1 Liquidity ratios……… 8

3.2 Efficiency ratios………10

3.3 Leverage ratios………11

3.4 Profitability ratios……….14

4 Forecast……… 16

5 References………17

1 Introduction

PNJ Company, formerly known as Jewelry Store, Phu Nhuan District, was established on April 28, 1988 Phu Nhuan Jewelry Joint Stock Company is a Vietnamese joint-stock company This company specializes in manufacturing and trading gold, silver, gemstone jewelry, business gifts, fashion

accessories, souvenirs, watches, buying and selling gold bars, providing diamond and stone testing services precious metals, precious metals, and real estate business In 2010, PNJ was ranked 16th by Plimsoll in the top 500 largest jewelry companies in the world

Vision: To become Asia's leading company in jewelry making and

retailing beauty products, reaching out to the world

Mission: PNJ is constantly innovating to bring exquisite products with

real value to honor the beauty of people and life

Core Values:

1 INTEGRITY FOR PERSONALITY

2 CONTINUOUSLY HOLLOW THE GOAL

3 INTERESTED IN DEVELOPMENT

4 DELICIOUS FOR CUSTOMERS

5 DIFFERENT CREATION PENSION

Over 33 years of establishment and development, PNJ has achieved many remarkable achievements: being in the Top 500 leading retailers in the Asia Pacific, Asia Pacific Quality Award, National Brand, Top 500

100 Best Working Environments in Vietnam, Best Working Environments

in Asia, Vietnam HR Awards 2020…

The company's main market share is through traditional retail stores, which still account for the majority of the market, in addition, the

company also sells products on e-commerce sites such as Shopee,

Lazada, or Genuine website

The three largest companies in this gold sector include PNJ, DOJI, and SJC, all with over 20 years of experience DOJI and SJC are two

competitors, but each side finds its own strengths to develop But in the

jewelry segment, PNJ's notable competitor is the one-year-old brand Precita, which currently has nearly 20 stores

To be able to develop and grow as it is today, PNJ has been having

strategic projects PNJ has been implementing the new enterprise

resource planning project - ERP, which was initially started on April 5,

2018, in Ho Chi Minh City with the most important component of the

Digital Transformation strategy development strategy direction in the period of 2018 - 2022 and a vision to 2030, in which, building a

technology infrastructure foundation and digitalizing business operations strategy (Digital Transformation) is an important pillar

Competitors: The world jewelry industry is already familiar with famous

brands such as Tiffany, Swarovski or Jacobs & Co As for Vietnam, the market is "overpopulated" by "emerging" brands such as Shimmer or FloralPunk However, these are niche brands and are not highly

competitive The common point of these types is outsourcing or

importing goods from China or Thailand with pre-defined designs on the market Growth in revenue - profit or even growth in business size

compared to the past is hardly a good indicator for understanding future sustainability The core problem lies in the difference so that it is difficult

or impossible for competitors in the industry to "imitate" Currently, the jewelry industry is divided into 3 different segments with low-end, mid-end and high-mid-end With thousands of large and small brands, the market

is "saturated with brands" with names like PNJ, Doji, SJC, Bao Tin Minh Chau, Phu Quy and smaller brands like Shimmer and FloralPunk

Brands began to compete fiercely in this area, as shown by the rapid growth of jewelry stores

There are 3 core factors of a jewelry retail business that help affirm

competitive advantages (1) Production and supply management capacity, (2) Strong distribution system and (3) Supplier position Supreme Factor (1) here includes a modern factory with outstanding capacity and

production and supply management capacity In addition, factor (1) also includes the design team and skilled labor Owning a modern production line, a design team of 50 members and a force of artisans and jewelers

of more than 1,000 people, every year, PNJ launches more than 4

million products to the market From gold and silver jewelry to precious stones and diamonds The current capacity of PNJ is 5 - 6 tons/year, only running 50 - 75% of the total supply capacity With a maximum

capacity of 8 tons/year, PNJ can completely supply to the market an additional 1.3 - 1.5 million products in the next 1-3 years, bringing the total supply capacity to over 6 million products/year In terms of the

entire market, PNJ's supply capacity far exceeds that of competitors in the same segment, ranking in the Top 10 factories with the largest

capacity in Asia This is the foundation for PNJ to reduce production costs per finished product and overwhelm the supply volume of

competitors before the whole industry "moves" to increase capacity

Above all, when demand explodes, PNJ can completely increase

capacity to reach the ceiling level or further increase capacity to take the lead in the industry

Meanwhile, factor (2) is a core thing when the retail system must be able

to distribute to the widest customers As of January 2021, PNJ currently has 339 stores and plans to open another 40-50 stores in the period 2020-2025 as well as expand the e-commerce segment Broadly

speaking, PNJ's store system is currently much superior to its nearest competitors, Bao Tin Minh Chau (BTMC) and DOJI With 200 retail

stores, BTMC is the most potential competitor that can threaten PNJ right now However, the market situation was quite clear with BTMC only having a distribution system from Quang Tri, while PNJ had more than 80% of stores in the South Further, when jewelry demand in Vietnam reaches the Asian average, there will be great room for both giants to increase their market share through strong distribution and supply chains Going further, factor (3) is an important factor determining the success or failure of factors (1) and (2) The relationship between these three

factors is complementary and intimate Factor (3) focuses on the ability

to control input costs and the ability to determine selling prices However,

it is not Doji or SJC that is the competitor that puts pressure on PNJ

even though this brand has 13 stores Unlike Doji or SJC, both PNJ and Diamond World are focused on innovation and retail promotion

The concentration of this market is still low, because more than 70% of the market belongs to small stores A big piece of cake for two

businesses to exploit, the opportunity will be divided equally if the

business goes in the right direction If PNJ has a strong advantage in the system, the retail jewelry firms will be more competitive in price

According to a survey on fashion consumption habits by Q&Me at the end of 2017, price is the most important factor in making purchasing decisions, accounting for 23% According to a Nielsen study, the group

of young people will reach 40 million people in the next decade and

spend about 100 billion VND per year Millennials target this customer, accounting for about 35% of Vietnam's population

2 Financial statement analysis

Data calculated by the excel file below

2019 2017 2019

LIABILITIES & OWNERS' EQUITY LIABILITIES

Current liabilities

Short-term trade accounts payables Short-term prepayments from customers Taxes & other payables from the State budget Payables to employees

Short-term accrued expenses Short-term loans Bonus & welfare funds

Non-current liabilities

Other long-term payables Long-term loans Provision for long-term liabilities

OWNERS' EQUITY Capital&reserves

Owners' capital Treasury shares Investment & development fund Retained earnings

- Retained earnings accumulated to the prior year end

- Retained earnings of the current year

TOTAL LIABILITIES & OWNERS' EQUITY

300 310

311 312 313 314 315 319 320 322

330

337 338 342

400 410

411 412 415 418 421 412a 421b

440

1,542,697,241,029 1,488,758,034,029

278,898,463,294 37,773,098,354 117,206,887,902 99,466,563,099 4,629,017,766 52,071,661,615 846,278,850,200 52,433,491,799

53,939,207,000

628,026,000 46,234,864,000 7,076,317,000

3,028,602,914,462 3,028,602,914,462

1,081,020,340,000 876,761,282,458 (7,090,000) 220,087,556,918 850,740,825,086 616,755,123,060

4,571,300,155,491

2,692,822,128,700 2,677,317,785,700

342,676,925,196 82,798,544,221 153,579,308,096 228,337,052,181 10,833,940,595 237,629,562,960 1,558,482,498,026 62,979,954,425

15,504,343,000

628,026,000 7,800,000,000 7,076,317,000

3,745,073,427,904 3,745,073,427,904

1,670,029,820,000 925,397,862,458 (7,090,000) 265,087,556,918 98,780,546,381 785,784,732,147

6,437,895,556,604

4,025,698,610,469 4,017,860,824,469

690,808,185,195 95,353,052,369 192,682,671,178 222,296,091,737 45,877,630,688 69,257,739,996 2,610,902,622,222 90,682,831,084

7,837,786,000

476,006,000 3,700,000,000 3,661,780,000

4,577,265,811,347 4,577,265,811,347

2,252,935,850,000 968,074,112,458 (2,101,090,000) 313,083,556,918 1,045,273,381,971 29,482,225,528 1,015,791,156,443

8,602,964,421,816

3,896,141,901,410 175,208,552,187

111,158,552,187 64,050,000,000

160,065,000,000

160,065,000,000

84,622,464,067

39,946,216,659 33,682,107,963 10,858,761,425 135,378,020

3,401,959,226,624

3,401,959,226,624

74,286,658,532

69,117,536,788 28,174,789 5,140,946,955

675,158,254,081 42,787,737,738

42,787,737,738

487,243,774,697

205,748,326,607 (190,867,255,077) 281,495,448,090 (5,245,459,783)

9,665,078,966

9,665,078,966

-395,271,613,400 (395,271,613,400)

135,461,662,680

53,968,320,576 81,493,342,104

4,571,300,155,491

100 110

111 112

120

123

130

131 132 136 139

140

141

150

151 152 153

200 210

216

220

221 222 223 227 228 229

240

242

250

253 254

260

261 262

270

5,405,256,600,641 206,721,179,629

206,721,179,629

-155,196,257,825

57,664,060,443 57,981,679,202 39,159,008,338 391,509,842

4,968,145,942,990

4,968,145,942,990

75,193,220,197

68,191,416,708 625,511,019 6,376,292,470

1,032,638,955,963 57,498,444,869

57,498,444,869

719,287,274,744

225,960,569,846 (228,217,854,094) 493,326,704,898 (6,610,702,975)

70,822,681,154

70,822,681,154

-395,271,613,400 (395,271,613,400)

185,030,555,196

99,678,730,358 85,351,824,838

6,437,895,556,604

7,333,364,485,251 95,224,439,008

95,224,439,008

-129,688,313,476

48,292,876,716 74,867,455,343 5,287,941,028 1,240,040,389

7,030,420,371,216

7,030,420,371,216

78,031,361,551

71,633,378,895 6,306,692,920 91,289,736

1,269,599,936,565 70,721,623,109

70,721,623,109

923,870,354,474

263,827,234,353 (270,991,464,989) 660,043,120,121 (19,576,762,884)

28,457,398,434

28,457,398,434

-395,271,613,400 (395,271,613,400)

246,550,560,548

158,318,980,481 88,231,580,067

8,602,964,421,816

As at 31 December 2018

PHUNHUAN JEWELRY JOINTSTOCK COMPANY

As at 31 December 2018 ASSETS

Currentassets

Cash

Cash equivalents

Held-to-maturity investments

Short-term trade accounts receivables

Short-term prepayments to suppliers

Other short-term receivables

Deficits in assets awaiting solution

Inventories

Inventories

Othershort-termassets

Short-term prepaid expenses

Value added tax deductibles

Taxes & other receivables from the State budget

Non-currentassets

Other long-term receivables

Fixedassets

Tangible fixed assets

Historical cost

Accumulated depreciation

Intangible fixed assets

Historical cost

Accumulated amortization

Long-term construction in progress

Equity investments in other entities

Provision for long-term investments

Otherlong-termassets

Long-term prepaid expenses

Deferred income tax assets

TOTAL ASSETS

PHUNHUAN JEWELRY JOINTSTOCK COMPANY

Year ended December 31

Netsales

Grossprofit

Financial income

Financial expenses

Including: Interest expense

Selling expenses

General and administration expenses

Netoperatingprofit(EBIT)

Other income

Other expenses

Resultsofotheractivities

Net income before tax

Business incometax-current

Net income after tax

Atributable to:

Earningspershare

Diluted earnings pershare

14,571,135,744,850 (11,792,052,183,391)

2,779,083,561,459

6,846,027,091 (66,345,864,211)

(61,109,042,390)

(1,170,069,069,426) (345,868,153,940)

1,203,646,500,973

4,637,809,502 (2,734,037,354)

1,903,772,148 1,205,550,273,121 (249,485,408,708)

959,923,347,147

959,923,347,147

6,481 6,481

2017

(9,064,872,939,048)

1,911,963,950,916

8,794,872,100 (56,475,629,564)

(54,981,032,499)

(774,978,169,326) (187,936,351,549)

901,368,672,577

7,394,867,935 (1,384,144,655)

6,010,723,280 907,379,395,857 (182,038,883,247) (484,064,550) 724,856,448,060

724,856,448,060

6,434 6,434

PHUNHUAN JEWELRY JOINTSTOCK COMPANY

(Indirect method)

1,205,550,273,121

42,101,648,087

- (169,041,343) (7,406,944,577) 61,109,042,390 (86,037,746,014) (1,566,186,716,366) 412,203,203,546 (44,784,289,702) (60,443,657,529) (231,958,086,112) (26,117,591,079)

(302,139,905,578)

(336,378,415,370) 1,075,665,048

- 160,065,000,000 6,331,279,529

(168,906,470,793)

97,273,160,000

- 4,320,772,043,080 (3,647,003,259,254) (268,371,812,300)

502,670,131,526

31,623,755,155

175,208,552,187

(111,127,713)

206,721,179,629

Year ended December 31

2018

3 Financial ratios

3.1 Liquidity ratios

Table the of liquidity ratios PNJ of for the period 2017-2019 of

Value

with2017 with2018

Cash ratio is the ratio to measure the amount of money currently available

at the company to cover all short-term liabilities This ratio immediately

indicates the financial crisis of the company Calculating by the formula :

&

Cash cash equivalents Cash ratio

Current liabilities

=

In 2017, the cash ratio of the firm was 0.12, in 2018 decreased by 0.04 to 0.08 and in 2019 continued to decrease 0.05 to 0.02 This shows that the company's ability to pay cash is declining

Current ratio is the ratio to measure the amount of money currently available at the company to cover all short-term liabilities The current ratio shows the correlation between current assets and current liabilities, is a widely used measure The current ratio indicates how many short-term assets each company uses for its short-term debt Calculating by the formula:

-Current assets Current ratio

Short term debt

=

In 2017, this index was 2.62 By 2018, it has decreased by 0.6 to 2.02 The year 2019 continued to decrease by 0.19 compared to 2018, to 1.83 The corporate current ratio in three years, though decreasing, is greater than 1, proving that the company's short-term assets are capable of paying short-term debts and this will increase the company's reputation with creditors