annual report - tasco jsc - year...

TASCO JOINT STOCK COMPANY

Add: 4th Floor, M5 Building, 91 Nguyen Chi Thanh Street, Dong Da Distric, Hanoi Website: www.taric.com.vn | www.tasco.com.vn

Tel: (84-4) 3773 8558 | Fax: (84-4) 3773 8559

2016

Annual Report

TASCO JOINT STOCK COMPANY 2016 ANNUAL REPORT

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INDEX

MESSAGE FROM CHAIRMAN OF BOARD OF MANAGEMENT ..................................................... 2

EVENTS AND AWARDS OF THE COMPANY AND MR. PHAM QUANG DUNG - CHAIRMAN OF THE BOARD OF MANAGEMENT ....................................................................................................... 4

I. Overview: ............................................................................................................................................ 5

1. General Information: ........................................................................................................................... 5

2. History of Establishment and Development: ........................................................................................ 5

3. Administration Model and Management Structure: .............................................................................. 6

4. Subsidiaries, Affiliates and Areas of Operations: ................................................................................. 7

5. Management Members: ....................................................................................................................... 9

6. Development Orientations: ................................................................................................................ 15

II. THE 2016 INCOME STATEMENT AND THE 2017 PLAN OF BOARD OF GENERAL DIRECTORS ........................................................................................................................................ 18

1. Finance Overview: ............................................................................................................................ 18

2. Business Operation Report: ............................................................................................................... 19

3. Financial Report: ............................................................................................................................... 20

4. Key financial figures: ........................................................................................................................ 21

5. Organization and human resources ................................................................................................... 21

6. Improvements in organizational structure, policies, management: ........................................................ 23

7. Investment status – Projects Status: ................................................................................................... 24

7.1. Financial status of subsidiaries and associates: ............................................................................. 24

7.2. Typical investment projects: ............................................................................................................ 30

8. Business plan for 2017: ..................................................................................................................... 44

III. ADMINISTRATIVE REPORT: ...................................................................................................... 45

1. Board of Management: ...................................................................................................................... 45

2. Board of Supervisors: ........................................................................................................................ 53

IV. INFORMATION ON SHARES AND INVESTORS RELATIONS: ........................................... 54

1. Shares: .............................................................................................................................................. 54

2. Shareholder structure, change of owner's investment capital: ............................................................. 54

3. Share ownership ratio of insiders: ...................................................................................................... 55

4. Information on share transactions with internal shareholders: ............................................................ 57

V. SUSTAINABLE DEVELOPMENT: ............................................................................................. 60

VI. FINANCIAL STATEMENTS: ..................................................................................................... 61


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MESSAGE FROM CHAIRMAN OF BOARD OF MANAGEMENT

Working for sustainable development is one of Tasco’s thoughts throughout our history. Leaders of Tasco Joint Stock Company have always relied on “quality” as the determinant in building “trust” for our own Employees, Customers, Shareholders and Partners.

Over 45 years, Tasco has established itself a solid position in the chain of transport, real estate and service products.

Referring to the arterial roads contributing to the local economic development is a reference to those constructed by Tasco, bringing convenience and safety in travel for every Vietnamese citizen. Every bridge executed by Tasco is at all our pride of building quality and affirmed brand on each span. In Tasco, we have always devoted ourselves to every product with the belief that quality is the core to customer satisfaction and our success as well.

On the ground of our proven track record of building and investment over 40 years, the period 2016 - 2018 will observe Tasco’s breakthrough in Real Estate Investment, a business area that has been underway since 2009 and orientated to be the key business of Tasco in the future.

We have been investing hugely in human, building a professional team to study solutions, pioneering the application of the World’s most advanced management methods to improve productivity and efficiency of our both services and products. One among the highlights of our strategy is to focus on investing in value-added products that help customers enjoy their lives. It is the stepping stone on our way to the future development and consolidation of the Tasco brand as the basis to take advantage of the opportunity to cooperate with foreign investors and partners.

We are committed to constant devotion and cooperation with you - our Customers, Partners and Shareholders - for success and affirmation of the Vietnamese brand by high-quality and great works, bringing huge values in the construction of a civilized and modern Vietnam.

I wish you and your family good health and happiness!

Best regards!

Chairman of Board of Management

Pham Quang Dung


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VISION, MISSION & CORE VALUES Vision Creat a living atmosphere with passion, creativeness and devotion. Mission Tasco creates products of houses, urban and traffic infrastructure in harmony with nature and social development Core values • Commitment: For sustainable development, never satisfy ourselves, never give away and

always overcome challenges, for benefits to Customers, Partners, Shareholders, Local Communities and Environment.

• Respect Tasco always gives prominence to individuals and diversification, listens for understanding and receives every constructive comment by respectful and trustful attitude.

• Cooperation: Cooperation goes along with every single relationship of Tasco, encouraging career development, respecting individual characteristics and sharing opportunities for team and individual development is the best working value.

• Creativity: Creativity to differentiate products is a way to survive; thus, there is no way but overcoming challenges to improve consistently.

• Learning Tasco is building an organization that knows to learn by criticizing positively, considering the mistakes as lessons for improvement instead of blaming on individuals.

Business principles: Building Tasco for sustainable development as the leading thought across all levels of

leadership. Having no personal factors in the organization. Protecting interests of shareholders in the long run. Developing operational procedures for production and business activities. Stopping to solve probleMs. to ensure that quality is well-maintained in the beginning. Training leaders and managers who understand the work well, live in the light of

corporate philosophy and coach the subordinates. Developing excellent individuals and teaMs. for adherence to corporate philosophy. Building a network of partners and suppliers of goods and services. Solving the root cause by going in person and looking at the scene to thoroughly

understand the situation (three-appearance principle). Keeping learning, self-criticising and promoting creativity and improvement of people. Managing information to always understand the national, regional and international

macroeconomic situations so as to make investment decisions for the business. Building a high-class work team as the only way for Tasco to achieve great successes.


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EVENTS AND AWARDS OF THE COMPANY AND MR. PHAM QUANG DUNG - CHAIRMAN OF THE BOARD OF MANAGEMENT

• Being awarded the 2nd Class Honor Soldier Medal in 1976 • Being awarded the 2nd Class Resistance Medal in 1984 • Being awarded the certificate of merit by the Prime Minister in 2007 • Being given Thanh Giong Cup to the national typical entrepreneur in 2008 • Being voted for the Ernst & Young International Awards – Vietnam

Entrepreneurship in 2011 and 2014 • Being awared the 3rd Class Labor Medal for contributions to the cause of

socialist construction and national defense throughout the working process.

• Being included in Top 100 Sustainable Development Enterprises of Vietnam 2016 (Ratings according to CSI 2016).

• Being included in Top 30 most transparent businesses on HNX 2016. • Being given Vietnam Quality Awards in 2006 and 2007. • Being awarded Golden Cup of Famous Brand in North Delta Coast 2007 by

Vietnam Union of Science and Technology Associations (VUSTA). • Being given Government’s Emulation Flag 2008. • Winning High Quality Building Work Award 2014. • Being given Excellent Unit Emulation Flag by Hanoi People’s Committee in

2010.


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I. Overview:

1. General Information:

- Company’s name : Tasco Joint Stock Company - Enterprise registration certificate number

: 0600264117 (former number 0103021321) issued by Hanoi Authority for Planning and Investment, registered for the 17th change on October 06, 2016.

- Charter capital : VND 1,763,294,160,000 - Owner’s equity : VND 1,763,294,160,000 - Head office : 4th Floor, M5 Building, No. 91 Nguyen Chi Thanh Street,

Dong Da District, Hanoi, Vietnam - Telephone number : 04. 3773 8558 - Facsimile number : 04. 3773 8559 - Website : http://www.taric.com.vn - Stock code : HUT - Business lines : - Housing development business; real estate business; lease of

offices, housing and workshops; -Construction of power facilities (thermal power, hydropower), water resources works, technical infrastructure; tunnel construction; - Infrastructure investment and operation

- Business locations : In various provinces and cities from the North to the South

2. History of Establishment and Development:

1971

Nam Ha bridge Team, Tasco’s precursor was established.

1976 Ha Nam Ninh Bridge Company was officially incorporated.

1992 It was renamed to Nam Ha Transport Construction Company (Nam Dinh)

2000 The company was equitized and named Nam Dinh Transport & Infrastructure Construction JSC

2007 The head office was relocated from Nam Dinh to Hanoi and it was renamed to Tasco JSC

2008 Tasco JSC’s stock was officially listed on HNX. Tasco has since then become the investor of transport infrastructure projects in the forms of BT and BOT

2011 Tasco JSC started to use “TARIC” - the new brand identity system

2013 Tasco kicked off the BOT project of National Highway 1A (section running Quang Binh)

2015 The Company officially deployed Foresa Villa project and other real estate projects

2016 Tasco raised the charter capital to VND 1,763 billion; The first ecological urban area (Xuan Phuong urban area) was completed and handed over to customers. The electronic toll collection system (VETC) has been put into operation.

2014 Real estate has become a key business area


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3. Administration Model and Management Structure: The administration model includes: - General Meeting of Shareholders: has the highest authority to make decisions on the

Company’s development, elect, dismiss, remove and replace members of the Board of Management and the Supervisory Board and other decisions as required by the laws.

- Board of Management: elected by the General Meeting of Shareholders, is the highest governing body with full powers to act on behalf of the General Meeting of Shareholders on matters related to the Company’s objectives and interests, except those under the authority of the General Meeting of Shareholders.

- Supervisory Board: is the body to supervise, on behalf of shareholders, all business, management and operation of the Company. The Supervisory Board is elected by the General Meeting of Shareholders and operates independently of the Board of Management and the Board of Directors

- Board of General Directors: including the General Director and the Deputy General Directors appointed by the Board of Management, is responsible for conducting the Company’s operations. The General Director is the legal representative and the highest executive in all operations.

- Operating apparatus consists of Divisions of Business, Investment, Project Management Finance and Internal Affairs, which perform daily operations, fund raising and management, brand development and personnel activities, etc., in addition to advising and proposing to the Board of General Directors the orientations for development and operation of the Company.

Organizational chart:


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4. Subsidiaries, Affiliates and Areas of Operations:

No. Business lines & members in charge Projects in progress

Real estate investment

1 TASCO JSC - Foresa Villa (Xuan Phuong Eco-Residential Area)

- Xuan Phuong Residence (Residential Area for Central Party Office, People Newspaper)

- South Building (Phap Van Apartment Building)

- Foresa My Dinh (Residential Unit 1 Project)

- Building No. 48 Tran Duy Hung….

Transport infrastructure project investment

1 Tasco Quang Binh One-Member Limited Company

Quang Binh National Highway No.1 Upgrading and Expansion Project (BOT Quang Binh)

2 Tasco Nam Dinh One-Member Limited Company

New Road Construction Investment Project, Phu Ly – My Loc Town Section (BT21)

3 Tasco Hai Phong One-Member Limited Company

National Highway No.10 Upgrading and Expansion Project, Quan Toan – Nghin Bridge (Hai Phong) Section (BOT Hai Phong)

4 Tasco Nam Thai Joint Stock Company BT 39 & BOT 39 Projects (Thai Binh)

5 Tasco 6 Limited Company BOT21, BOT 10 & Dong Hung Bypass Subproject

6 BOT Hung Thang Phu Tho Company Limited

BOT National Highway No. 32 Phu Tho

Construction/Services/Hospitals/Consultancy & Training

1 Thang Long Construction Corporation Construction services

2 Tasco Thanh Cong Joint Stock Company Building material transport and mining services

3 VETC Vietnam Joint Stock Company VETC Electronic Co., Ltd.

Toll collection and electronic toll collection services

4 Tasedu Co., Ltd. Consultancy and training services

5 T’Hospital Co., Ltd. Health and hospital services


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Management Members


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5. Management Members:

BOARD OF MANAGEMENT:

Mr. Pham Quang Dung Chairman of Board of

Management

Year of birth : 1954 Native place : Hai Hau – Nam Dinh Qualifications : Business Administration Number of shares held: 15,448,948 shares (percentage: 8.761%) If Tasco was a ship, Chairman Pham Quang Dung would be its talent captain. He is an entrepreneur with full of wisdom, heart and vision and a desire to get rich permanently from his early years and for 15 years working in the State-owned units. By virtue of natural talents, strong will and determination, he rescued Tasco Joint Stock Company from the hardship of being a state-owned enterprise into a powerful Tasco today. He is thought of as both a simple, diligent, calm and persistent leader and a modern entrepreneur with thoughts of corporate development. However, above all, it is a good-natured and pure heart. His only wish is to help all the dreaMs. to assert capabilities to become a reality and turn Tasco into the leading brand in Vietnam in the field of real estate.

Mr. Pham Van Luong Chairman of Board of

Management

Year of birth : 1957 Native place : Liem Hai - Ninh Nam - Nam Dinh Qualifications : Business Administration, Accounting Number of shares held : 7,116,184 shares (percentage: 4.036%) If Mr. Pham Quang Dung was a talented Captain of the ship Tasco, Mr. Pham Van Luong would be the lighthouse for such ship to land successfully. Despite an army officer, he has a strong desire to do business. He always has in mind that “there is no way other than to engage in financial activities to make it easy to realize our dreaMs. and help others”. After joining the army, therefore, he moved to Nham Dinh Transport Infrastructure Construction Joint Stock Company (Tasco’s precursor) as the leader of public works construction team. After a period of relentless efforts, he was in turn appointed to be the Director, General Director and Vice Chairman of Tasco Joint Stock Company. Regardless of position and time, he is always the strong support for the Company’s staff and the happy dock for the captain Pham Quang Dung to calmly steer the ship. He is a frank, funny, kind and assertive leader dressed in a military.


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Mr. Vu Quang Lam Member of Board of

Management

Year of birth : 1975 Native place : Nam Dinh Qualifications : Engineer of Economics in Construction Number of shares held: 4,925,515 shares (percentage: 2.793%) The year 2001 marks a turning point in Mr. Lam’s life when he quit his position of the Quality Director in Samwhan Group to work for Tasco in the early days of its equitization. With his gifted communication skills, acumen and wisdom, he has promoted to be the Business Manager, and then Deputy Director of the Company. In 2004, Mr. Lam was Tasco’s representative to develop the South market as the Director of Ho Chi Minh Branch. Working in a strict, professional and scientific style, in 2006 Mr. Lam went to Hanoi to take the direct responsibility for the development of Tasco’s huge real estate projects. Growing up with Tasco, he has become a well-known expert in project development and management for Tasco. Each works performed by Tasco as a contractor or owner across the country was contributed, both physically and spiritually by him.

Ms. Tran Thi Thanh Tan

Member of Board of Management

Year of birth : 1971 Native place : Ha Nam Qualifications : Finance - Investment Number of shares held: 2,998,730 shares (percentage: 1.701%) Nearly 20 years have pass since Mr. Tan started to work at the Company, she has been gradually got successes with her enduring persistence and strong desire to reach farther along with the Tasco ship. Starting as an accountant, after years of solidarity with and contributions to Tasco, she was honored to be the Deputy General Director of Finance and then the member of the Board of Management. It not only confirMs. her capabilities but also the heart of a person who loves Tasco and works for Tasco. She has a simple wish that Tasco will be a century-old brand, and those who work under the Tasco home will become millionaires of the country.


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Ms. Pham Thi Nhan Member of Board of

Management

Year of birth : 1962 Native place : Giao Thuy - Nam Dinh Qualifications : Accounting Number of shares held: 2,619,207 shares (percentage: 1.485%) Being a Bachelor of Economics with 25 years of experience in accounting and 12 years as a chief accountant has fostered her careful and transparent characters. Regardless of the pressure of work and fierce competition at any time, Tasco management and staff have still felt warm hearted and trusted in her. Having a sense of humor and being intelligent, always focusing on work, setting the Company’s growth as the goal for herself, she has contributed to numerous successful projects. For her, happiness is when she sees Tasco grow stronger everyday and when workers’ life is guaranteed and improved. “Tasco is always in my heart and I have been striving hard for that”, it is her biggest wish.

Ms. Pham Thi Chi


Year of birth : 1980 Native place : Hai Phuong, Hai Hau, Nam Dinh Qualifications : Law Number of shares held: 755,000 shares (percentage: 0.428%) Being a bachelor of law, Ms. Pham Thi Chi has many years of experience as a legal expert and director for large organizations, state agencies and large companies before joining Tasco Joint Stock Company. Ms. Pham Thi Chi has been entrusted by Tasco’s Board of Management to become a member of the Board since 2015 thanks to her capabilities, enthusiasm and wisdom. She has always focused on becoming an excellent member among Tasco’s second generation of leadership. Taking the position of Chief of Human Resources Sub-Division, Ms. Chi put a lot of energy and expectation into Tasco’s second generation of leadership who are young, intelligent, creative, enthusiastic, loyal and kind hearted, both inheriting and developing all cultural values built throughout Tasco’s more than 40 years of formation and development.


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Ms. Nguyen Ngoc Hung


Year of birth : 1978 Native place : Trung Hung, Yen My, Hung Yen Qualifications : Engineer of Economics in Construction Number of shares held: 1,059,577 shares (percentage: 0.601%) “Nothing is impossible” is a quote that Mr. Hung likes and sets as the guideline for his career path. With talent and sophistication in all relationships, he has not only built trust among all Tasco staff but also created reputation with all external partners. Attaching to Tasco in the early years when the Company moved to Hanoi and starting from a technical staff, having been the leader of the construction team and experienced management positions in the field of investment and market development, Mr. Hung can be said to be the man who has a lot of good qualities of a manager and a leader.

Mr. Hoang Trung Dung


Year of birth : 1979 Native place : Tien Yen, Quang Ninh Qualifications : Economic law Number of shares held: 0 share (percentage: 0%) As a member of the Board of Management in charge of advising on strategies for the Company, Mr. Hoang Trung Dung always expects to devote his deep knowledge, foresight, leadership and dedication to the new, solid and successful directions for TASCO. Having graduated from Foreign Trade University (Hanoi) and obtained a PhD in Law from France, before joining TASCO, Mr. Hoang Trung Dung had held many senior positions at Financial Institutions, large companies and groups. He is also known as an independent speaker, a consultant and a number-one soft skills training expert in Vietnam today.


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EXECUTIVE BOARD:

Mr. Hoang Ha Phuong

General Director

Year of birth : 1979 Native place : Thanh Liem, Ha Nam Qualifications : Bridge & Road Engineer Number of shares held: 1,097,000 shares (Percentage: 0.622%) Mr. Hoang Ha Phuong has 13 years of experience in the field of road and bridge construction and has involved in various important projects such as Thanh Tri Bridge (Hanoi) construction, National Highway 1A expansion, etc. Accompanying Tasco for nearly 10 years in investment projects, Mr. Phuong has taken significant management positions such as Deputy Project Manager, Project Management Unit Director, Project Enterprise Director and many more. He has been the General Director since 2015. With his remarkable capabilities, he helped Tasco obtain big project series. It is not only for the dedication or desire for his own but also for the desire for Tasco as a whole to soon be the leading brand in many sectors.

Mr. Nguyen Dinh Sieu

Deputy General Director

Year of birth : 1970 Native place : Hanoi Qualifications : Architect Number of shares held: 207,200 shares (percentage: 0.118%) Starting as a supervision consultant of the Owner Ho Tay International Joint Venture, with his efforts, Mr. Sieu became the Director of GELEXIM Corp. - Hanoi Branch. In 2010, he joined Tasco, willingly accepting to start again as a Project Management Specialist. However, with his knowledge, practical experience, capabilities and enthusiasm, he was entrusted by management to be the Housing Project Manager. Since 2012, Mr. Sieu has held the position of Deputy General Director of the Housing Development Division and currently Deputy General Director of the Project Management Division.


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Mr. Truong Van Thinh


Year of birth : 1976 Native place : Thai Binh Qualifications : Engineer of Construction Economics Number of shares held: 715,600 shares (percentage: 0.406%) Being the Deputy General Director of Business Division, Mr. Truong Van Thinh is one of the experienced leaders in infrastructure and real estate investment market. Having graduated from National University of Civil Engineering (Hanoi), majored in Construction Economics, Mr. Thinh has jointed Tasco since 2007 and become one of the great contributors to the Company’s success in numerous large-scale projects. With his talents, understanding and sense of humor, Mr. Thinh has been trusted by all partners of Tasco.

Mr. Nguyen Dinh Dung


Year of birth : 1971 Native place : Hung Yen Qualifications : Civil Engineer Number of shares held: 0 share (percentage: 0.406%) Obtaining a degree in Industrial and Civil Engineering at Hanoi Architectural University, Mr. Nguyen Dinh Dung is well known for his experience in civil engineering, construction project management and business administration. Prior to joining Tasco, Mr. Dung had worked for a number of large companies including Hanoi Construction Corporation, HUD Holdings and Viwaseen Corporation. Being trusted by his talents and enthusiasm, Mr. Nguyen Dinh Dung is leading the Investment Division of Tasco Joint Stock Company, with the goal of effective project investment management.

Ms. Tran Thi Thanh

Chief Accountant

Year of birth : 1984 Native place : Nam Dinh Qualifications : Bachelor of Finance - Accounting Number of shares held: 165,420 shares (percentage: 0.09%) After graduating from Academy of Finance, Ms. Tran Thi Thanh started to work for TASCO as an accountant; From April 2008 to June 2015 she was a general accountant; After 7 years of companion with the Company, with her flexible but solid experience and knowledge in accounting and law enforcement, Ms. Tran Thi Thanh has gradually affirmed her values and contributions. Since July 2015 to the present, Ms. Thanh has kept further contributions to the Company as the chief accountant.


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6. Development Orientations: Over 45 years since it was born, Tasco Joint Stock Company has always been active in keeping

up with the preservation and development of capital, ensuring the interests of its shareholders. The strategic development orientations of the Company are built on the following important foundations: Vision

Our vision is to create a favourable environment for people to live, passionate, create and devote.

Mission It is Tasco’s mission to provide the community with the products of houses, urban areas and transport infrastructure in harmony with nature, matching the development of social civilization.

Core values Commitment: For the goal of everlasting development, is never to feel satisfied, never give up and do everything in a way that surpasses challenges, for the benefit of our Customers, Partners, Shareholders, Local Communities and the Environment.

Cooperation: The spirit of cooperation throughout Tasco’s relationships, encouraging career development and respect for personality, sharing opportunities to develop teaMs. and individuals is the best working method.

Respect: Tasco has always emphasized individuals and diversity, listened to understand everyone, accept every opinion for action with respect and trust.

Creativity: Creativity to differentiate products is a way to survive; thus, there is no way but overcoming challenges to improve consistently.

Learning: Building a learning organization, by constantly self-criticizing and regarding faults as opportunities to learn, rather than self-reprimanding is one of Tasco’s core values.

Areas of operations in the Company’s development strategies: Currently, Tasco Joint Stock Company is operating and developing in three main areas below:

REAL ESTATE: Focusing in the core capacity as the owner of transport infrastructure projects to invest in real estate in the form of land exchange for infrastructure. Looking for real estate investment opportunities in Hanoi and major cities.

TECHNOLOGY: Investing in electronic toll collection system nationwide and expanding development of smart transport toll collection systeMs. such as urban toll collection, parking lots, electronic bus tickets, sky train tickets, etc.

HEALTH: Cooperating with public hospitals located in Hanoi to invest in hospital projects in accordance with the Government’s policy on the socialization of the health sector.


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7. Risk Factors:

a) Economic Risks:

Any economy always has certain potential risks which are caused by the fluctuation of the economy’s basic factors such as economic growth, inflation, interest rates and exchange rates, and so on. As participants in the economy, businesses are not outside the influence and impacts of change of such factors.

The fluctuation of macroeconomic variables such as growth rates, inflation, interest rates, exchange rates and government policies to adjust macroeconomic variables as well as industry development policies have direct or indirect impacts on the performance and business results of businesses.

For the real estate sector, economic growth is an important determinant. A strong and stable economy may lead to increasing demands for housing and office spaces; on the contrary, a slower and weaker growing economy adversely affect real estate and construction investment operations. Therefore, the effective adoption of government’s macroeconomic policies helps reduce the economic risks to businesses in general and real estate investors and traders, including the Company, in particular.

b) Interest Rate Risks:

For a business, an interest rate risk occurs when its interest payables are higher than its profitability and the level of interest rate risks varies from industry to industry, up to the industry’s debt structure.

Interest rates are currently relatively stable. Vietnam dong denominated interest rates are commonly quoted at 0.8% -1% p.a on demand and time deposits of less than one month; 4.5% -5.4% p.a on time deposits of from 1 month to less than 6 months; 5.4% -6.5% p.a on time deposits of from 6 months to less than 12 months; and 6.4% -7.2% p.a on those of over 12 months. The common lending rates in preferred sectors are 6% -7% p.a on short term loans, 9% -10% p.a on medium and long term ones. Lending rates for normal business areas are 6.8% -9% p.a on short term loans and 9.3% -11% p.a on medium and long term ones.

These risks are managed by the Company by maintaining a reasonable level of loans and analyzing the competitive situation in the market to obtain favorable interest rates for the Company from appropriate borrowing sources.

c) Legal Risks

Activities of Tasco Joint Stock Company are governed by general legal documents such as the Enterprise Law and Securities Law; specialized legal documents like the Construction Law, Bidding Law and Investment Law; and bylaws such as the Decree on Construction Investment Project Management, the Decree on Construction Quality Management and the Decree on Public-Private Partnership Investment, etc. On the other hand, because of a public company with its shares listed on the Stock Exchange, the Company is subject to the provisions of the law on securities and stock market.

The current legal system is under finalization and modification. To create a favorable and equal legal for economic sectors, meeting international standards and practices in the process of integration, the National Assembly promulgated different new laws. In addition, the Government


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has developed strategies for infrastructure development, especially transport infrastructure. A system of laws and policies being developed and implemented in a consistent and synchronous manner will definitely facilitate the business activities of enterprises in general and construction enterprises like TASCO in particular. However, if the Company does not catch up with changes in the legal system, it may affect the Company’s operations.

In order to control the legal risks, the Company always updates changes in the legal environment related to its operations, thus developing suitable business development plans.

d) Specific Risks Business lines of the company are currently exposed to a number of specific risks of the

industry as follows Policy risks: The Company’s performance depends on the policies on public investment

in infrastructure and its possibility to win the contracts in investment projects, while public investments in infrastructure rely on the state of the Vietnamese economy. When public investments decline due to the economic downturn, the government’s spending policies or other causes may adversely affect the Company’s finance and performance. Capital and solvency risks: Operating in the field of investment in transport

infrastructure and real estate where completed projects may be delinquent, consequently, the Company must maintain a high debt to equity ratio. Maintaining a high debt to equity ratio plus long-term capital tie-up may pose a default risk. Material risks: The Company is also facing the risk of fluctuating market prices and

unstable supply of raw materials. The fluctuation of prices and supply of important input materials such as bitumen, petroleum, steel, sand, stone, gravel, cement and many more all directly affect the Company’s business performance.

e) Investment Risks Project legal risks: The Company may be at risk of failure to execute the projects on

schedule or failure to complete its business plans if application for a project license is prolonged than expected. Land clearance compensation risks: This is a characteristic of real estate business in

Vietnam. In Hanoi, the majority of the land planned for urban and industrial projects is land in use; hence, land clearance in these areas is often complex. On the other hand, the compensation price frame in accordance with the regulations of the State is usually adjusted. This causes difficulties for land clearance, affecting the progress of construction projects as well as direct impacting investment costs and turnover of enterprises in general and the Company in particular. Market risks: The characteristics of enterprises operating in investment in and trading of

housing and urban area services are large capital demands, and long construction periods. Although according to the regulations, upon completion of projects’ infrastructure, owners can raise funds from buyers, its success depends much on the real estate market. If the required level of funds can not be reached, owners must maintain a high debt to equity ratio and long capital tie-up time. As such, the Company as an owner may be exposed to interest rate risks and liquidity risks. Industry specificities may present risks of reduced solvency and reduced profitability of the Company.


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II. THE 2016 INCOME STATEMENT AND THE 2017 PLAN OF BOARD OF GENERAL DIRECTORS

1. Finance Overview: a. Assets / liabilities and equity:

Unit: million dong

BALANCE SHEET GROWTH RATE IN 2016

Item 2015 2016 Value Percent

A – CURRENT ASSETS 1.975.191 2.110.035 134.844 6,827%

I. Cash and cash equivalents 576.880 428.688 (148.192) -25,69%

II. Short-term financial investment 45.249 134.298 89.049 196,80%

III. Short-term accounts receivable 1.220.713 1.311.592 90.880 7,44%

IV. Inventory 56.384 41.507 (14.877) -26,38%

V. Other current assets 75.963 193.948 117.985 155,32%

B – NON-CURRENT ASSETS 5.111.160 7.209.817 2.098.657 41,06%

I. Long-term accounts receivable 250.642 339.787 89.145 35,57%

II. Fixed assets 2.440.807 2.263.324 (177.483) -7,27%

III. Investment property - - -

IV. Long-term work in progress 2.038.635 4.145.823 2.107.188 103,36%

V. Long-term financial investment 321.821 325.406 3.585 1,11%

VI. Other non-current assets 59.254 135.477 76.223 128,64%

TOTAL ASSETS 7.086.351 9.319.853 2.233.502 31,52%

C - LIABILITIES 5.363.935 6.786.656 1.422.721 26,52%

I. Current liability 727.385 1.517.801 790.416 108,67%

II. Non-current liability 4.636.551 5.268.855 632.304 13,64%

D – OWNER’S EQUITY 1.722.416 2.533.196 810.780 47,07%

I. Owner’s equity 1.722.416 2.533.197 810.781 47,07%

II. Sources and other funds - - -

TOTAL LIABILITY AND EQUITY 7.086.351 9.319.853 2.233.502 31,52%


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b. Income Statement:

Unit: million dong

INCOME STATEMENT Growth in 2016

ITEM 2015 2016 Value Percent

1. Net revenue from sales and service rendering 2.245.500 2.786.122 540.622 24,08%

2. Cost of goods sold 1.921.992 1.998.936 76.944 4,00%

3. Gross profit from sales and service rendering 323.508 787.186 463.678 143,33%

4. Revenue from financial activities 12.313 36.847 24.534 199,25%

5. Financial expenses 105.811 199.195 93.384 88,26%

6. Gain/loss in associates, joint ventures 17.876 19.078 1.202 6,72%

7. Sales expense 13.983 51.636 37.653 269,28%

8. General and administrative expenses 37.901 107.276 69.375 183,04%

9. Net operating profit 196.002 485.003 289.001 147,45%

10. Other gain 791 4.687 3.896 492,24%

11. Gross accounting profit before tax 196.793 489.690 292.897 148,84%

12. Current corporate income tax charge 35.848 85.763 49.915 139,24%

13. Profit after corporate income tax 160.945 403.928 242.983 150,97%

14. After-tax profit of parent company 160.165 403.235 243.070 151,76%

15. After-tax profit of non-controlling shareholders 780 693 (87) -11,16%

2. Business Operation Report: Production and operation in 2016:

Unit: billion dong

Plan PerformPercentage of reaching

plan (%)

Compared with 2015

(%)

1 Revenue from sales and service rendering 2.256 2.400 2.960 123,3% 131,2%

2 After-tax profit 160 380 404 106,3% 252,2%

No. Items 2015

2016


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Net revenue from sales and service rendering in 2016 was 2,960 billion dongs, at 123.3% of annual plan and equal to 131.2% of year 2015. After-tax profit was 404 billion dongs, reaching 106.3% of annual plan and equal to 252.2% of year 2015, where:

- Net revenue from real estate business in 2016 was 2,147 billion dongs, equal to 676.1% of year 2015;

- Revenue from toll collection in 2016 was 447 billion dongs, equal to 215.6% of year 2015; - Revenue from construction contracts and other services was 367 billion dongs, equal only

to 21.2% of year 2015 Based on those data, year 2016 was a successful year of Tasco when both revenue and after-

tax profit were outstandingly higher than year 2015. In 2016, Tasco concentrated on real estate investment with this field’s density of revenue and profit occupying about 70% of total revenue and profit of the company coming from Foresa villa and Xuan Phuong Residence projects.... However, revenue from toll at BOT plazas (projects: BOT 10, BOT 21, BOT Quang Binh...) still produces stable profit over the years for the company.

3. Financial Report: Unit: million dong

Item 2015 2016 % increase/decrease

Total assets/Total liabilities and equity 7.086.351 9.319.853 31,52%

Current assets 1.975.191 2.110.035 6,83%

Non-current assets 5.111.160 7.209.818 41,06%

Liabilities 5.363.935 6.786.656 26,52%

Net revenue 2.245.500 2.786.123 24,08%

Operating profit 196.002 485.003 147,45%

Other profit 791 4.687 492,56%

Before-tax profit 196.793 489.690 148,84%

After-tax profit 160.945 403.928 150,97%

Rate of dividend payment 12% 15% 25%

Total assets and total liabilities and equity in 2016 were 2,233 billion dongs in comparison with year 2015 equivalent to 31.52%, where big density came from the company’s non-current assets: increasing by 2,098 billion dongs corresponding to 41.06%, mainly because in this year the Company has been executing the BOT infrastructure investment projects and real estate projects such as: Road from Le Duc Tho to Highway 70, BOT Hai Phong, Xuan Phuong Residence project, Phap Van Building….

The Company’s liabilities in 2016 increased by 810.8 billing dongs in comparison with year 2015, equivalent to increasing by 47.07%, mainly because of liabities payable to the banks for purpose of executing the BOT Hai Phong project, Non-stop toll plaza (BOO form) project and pairtially of deposits paid by the clients who deposit for houses in the company’s real estate projects. If criteria of capital structure is based, Ratio of Liability/Total assets in 2016 was 0.73%, lower than 0.76% of year 2015 and Ratio of Liability/ Owner’s Equity in 2016 was 2.68


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times, decreasing by 0.43 in comparison with 3.11 times of year 2015. This shows that the company becomes more self-control in its capital, less dependent on borrowings.

Based on production and operation, in 2016, Board of Management proposed to adopt at the 2016 General Meeting of Shareholders the cash dividend payment of year 2015 at 12%, in two installments:

+ Resolution of Board of Management No. 04/NQ-HDQT dated 02/02/2016 approving the advanced payment of dividends of year 2015 in cash to existing shareholders at 7% and at face value of 10,000 dongs/share.

+ Resolution of Board of Management No. 16/NQ-HDQT dated 09/07/2016 approving the second payment of dividends of year 2015 in cash to existing shareholders of Tasco JSC at 7% and at face value of 10,000 dongs/share

4. Key financial figures:

Item 2015 2016 Remark

1. Solvency

- Current ratio (Working assets/current liabilities) 2,72 1,39

- Quick ratio (Working assets - Inventory)/Current liabilities 2,64 1,36

2. Capital structure

- Ratio of Liability/Total assets 0,76 0,73

- Ratio of Liability/Owner’s equity 3,11 2,68

3. Capability of operation

- Inventory Turnover (Cost of goods sold/Inventory average)

34,09 48,16

- Net revenue/total assets 0,32 0,30

4. Profitability

- Ratio of after-tax profit/ Net revenue(%) 7,13% 14,28%

- Ratio of after-tax profit/ Owner’s equity average (%) 9,30% 15,95%

- Ratio of after-tax profit/ Total assets (%) 2,26% 4,33%

- Hệ số LN từ hoạt động KD/Net revenue(%) 8,73% 17,41%

5. Organization and human resources 5.1. List of Executive Board: (See page 13) 5.2. Changes of Executive Board:

Mr. Nguyen Dinh Dung: Appointed as Deputy General Director of Department of Investment under Decision No. 99 / QD-TASCO dated 22/4/2016

Mr. Trinh Xuan Nam: Dismissed Deputy General Director of the Infrastructure Project Management Unit under Decision No. 325 / QD-TASCO dated 14/11/2016


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- Decision No. 31/2016 / QD-HDQT dated 14/11/2016 on the adjustment of the organization chart of the company, which unifies two infrastructure project management unit and real estate project management unit into one single unit - project management unit.

5.3. Number of employees and policies for employees:

5.3.1. Number of employees: A number of employees in the Company as of 31/12/2016 is 154 people, of which: - Divided by educational level: + Post graduate: 12 + University: 132 + College, vocational school: 1 + Technical workers, unskilled workers: 9 - Divided by function: + Indirect employees: 13 + Direct employees: 141

5.3.2. Policies for employees: In order to reach the goals of sustainable and long-term development, the Company has

developed and implemented policies towards employees in the following directions: - To support and create conditions for employees to promote their capabilities in studying

and raising their professional knowledge. - To train and arrange human resources in line with the development situation of the

Company. - To ensure adequate jobs for the employees, ensure income in conformity with the ability to

contribution and market. - To fully exercise the rights and obligations towards employees in accordance with the

prescribed regimes and policies. - To provide a timely reward policies for individuals and collectives which have merit

contributions to the Company and take disciplinary measures against individuals who have adversely influenced the Company's interests and prestige.

- To provide policies to attract good and suitable employees for the Company and policies to encourage employees to cooperate and work in the company for a long time, such as policies for tourism, health care policies, policies for periodical health examination, holidays, Tet holidays, sickness, maternity, fondness, marriage and etc.

- The Company regularly organizes collective activities to celebrate great holidays and encourages the spirit of employees such as: children's festival, Mid-Autumn Festival, International Women's Day on March 08; Vietnamese Women's Day on October 20; Rewards for children of employees who have high achievements in learning and etc.

- Every year, the company always develops plans, makes training and retraining of skills and qualifications for employees in many forms, in order to develop employees to meet the requirements to diversify the Company's business lines, to keep pace with technological advances of advanced countries in the world.

- The company develops training policies for each level: for management and for staff, team leaders /work managers and workers. This shows that the Board of Directors focuses on training and development of human resources, creating conditions and opportunities for all employees to promote their capacity, affirm personal capacities in the development trend of the Company.


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6. Improvements in organizational structure, policies, management:

In 2016, the Board of General Directors has focused on managing production and business; focused on something as follows:

- To implement and review strategies to advise the Board of Management to adjust the strategic orientation for 2017-2020.

- To strengthen the communication of corporate culture to employees, partners and customers in order to unite the will, the strength of internal unity and increase the understanding and trust with the stakeholders.

- To improve the BSC evaluation system for all departments of the Company and project enterprises.

- To strengthen the control of financial plan to ensure the balance of cash flow for production and business.

- Human resource development: To encourage and create favourable conditions for staff to train, share professional skills and soft skills; Promote the selection and training of employees; Encourage all employees to find quality candidates for key positions. - To maintain the process system under ISO 9001: 2008 standards, which has been evaluated and re-certified by BVQI as ISO 9001: 2008; - To assess and be granted with the certificate of labor safety and vocational health OHSAS 18001: 2007; - To organize KAIZEN - QCC activities in the form of KAIZEN Group to enhance and promote the spirit of progress, innovation in all employees of the Company and develop creative culture, improve the productivity of the entire company; - Disclosure of information is done fully, promptly and truthfully in accordance with regulations of Hanoi Stock Exchange and SSC. In addition, to promote and attach importance to shareholder relations, regularly meet and exchange with investors, investment funds, brokers, analysts.


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7. Investment status – Projects Status:

7.1. Financial status of subsidiaries and associates:

In 2016, under the direct guidance of the Board of Management and capital representatives in enterprises as well as efforts of subsidiaries, associates and companies, the following results were achieved:

Unit: Million dong

No Name of the company Actually

contributed charter capital

Ownership ratio of Tasco

Total assets Net revenues

Before – tax profits

After – tax profits

A Subsidiaries

1

TASCO 6 One Member company Limited - Business registration certificate: No 0600542036 issued by Nam Dinh Province Department of Planning – Investment dated 16/3/2009, for the first change time on 17/11/2009, for the second change registration on 19/7/2012. - Address: No 20, Dien Bien Street, Nam DInh City, Nam Dinh Province - Main business lines: road fee collection and toll station management services; Road maintenance management; Business and exploitation of road infrastructure works.

65,180 100% 850,816 257,110 43,985 35,187

2

Nam Thai Tasco Joint Stock Company - Business registration certificate: No 0600454929 issued by Thai Binh Province Department of Planning – Investment for the first time on 7/8/2008, for the 6th change dated 14/9/2012. - Address: House No 20, Alley 209, Tran Thai Tong Street, Tran Hung Dao Ward, Thai Binh City, Thai Binh Province, Vietnam.

293,325 51% 749,543 0 15 12


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- Main business lines: construction of technical works, transport infrastructure; Management consultancy and consultancy in supervision of construction works.

3

Quang Binh TASCO One Member Company Limited - Business registration certificate: No 3100959525 issued by Quang Binh Province Department of Planning – Investment dated 09/5/2013, for the first change on 25/7/2013.. - Address: No 5 Quang Trung, Hai Dinh Ward, Dong Hoi City, Quang Binh Province - Main business lines: road construction; Manufacture and sales of building materials, prefabricated concrete components; Business and exploitation of road infrastructure

311,447 100% 1,810,016 187,357 47,605 47,605

4

Nam Dinh TASCO One Member Company Limited - Business registration certificate: No 0600642753 issued by Nam Dinh Province Department of Planning – Investment for the first time dated16/7/2009, for the 6th change time on 20/11/2013. - Address: No 20, Dien Bien Street, Nam Dinh City, Nam Dinh Province - Main business lines: construction of technical works, transport infrastructure; Management consultancy and consultancy in supervision of construction works.

343,278 100% 423,998 0 1,752 1,752

5 Thanh Cong Tasco Joint Stock Company - Business registration certificate: No 0106259517 issued by Hanoi City Department of Planning – Investment for

12,000 51% 88,069 242,133 1,897 1,496


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the first time dated 08/8/2013. - Address: 4th floor, Building M5, 91 Nguyen Chi Thanh, Dong Da, Hanoi. - Main business lines: Exploitation and business of building materials; transport; Construction machinery and equipment

6

VETC Joint Stock Company - Business registration certificate: No 0106858609 issued by Hanoi City Department of Planning – Investment dated 22/05/2015, for the 2nd change registration on 14/08/2015. - Address: 4th floor, Building M5, No 91 Nguyen Chi Thanh, Lang Ha Ward, Dong Da District, Hanoi City

- Main business lines: VETC Joint Stock Company is a unit established for the purpose of deploying non-stop automated toll station construction project. In addition, VETC also implements business line: direct support of roads and railways, Construction of other civil engineering works; Installation of other construction systems; completion of construction works; Construction of railways and road projects and etc.

252,801 51% 537,622 5,455 -101 -101

7

Hai Phong Tasco One Member Company Limited - Business registration certificate: No 0201632182 issued by Hai Phong City Department of Planning and Investment for the 1st time dated 08/5/2015. - Address: No 4, Hanoi Street, Thuong Ly Ward, Hong Bang District, Hai Phong City.

356,520 100% 1,611,743 0 0 0


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- Main business lines: Construction of roads and railways; whole sales of other installation materials, equipment in construction;

8

TASEDU Consulting and Training Company Limited - Business registration certificate: No 0107440099 issued by Hanoi City Department of Planning – Investment for the first time dated 19/5/2016 - Address: 4th floor, Building M5, 91 Nguyen Chi Thanh, Dong Da, Hanoi

- Main business lines: Educational support services, vocational education services; Education, sports and entertainment, culture and arts; Investment consultancy; Management consultancy; Market research and opinion polls; organization of trade promotion; Consultancy of broker, auction of real estate

261 100% 485 1,306 13 11

9

T’Hospital Company Limited - Business registration certificate: No 0107433574 issued by Hanoi City Department of Planning – Investment for the first time dated 16/5/2016. - Address: No 72, Nguyen Chi Thanh, Hanoi

- Main business lines: Investment consultancy; Whole sales of pharmaceuticals and medical equipment; sales of food; Production of medicines, pharmaceuticals and chemical; Construction of other civil engineering works; Activities of hospitals and clinics

5,000 100% 10,229 0 0 0

10 VETC Auto Fee Collection Company Limited 5,000 60,8% 537,495 5,682 -221 -221


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- Business registration certificate: No 0107500414 issued by Hanoi City Department of Planning – Investment for the first time dated 08/7/2016. - Address: No 167, Trung Kinh, Yen Hoa Ward, Cau Giay, Hanoi - Main business lines: Direct support for railway and road transport; Construction of other civil engineering works; Installation of other construction systems; Completion of construction works; Construction of railways and road projects…

11

Hanoi Eye Hospital Joint Stock Company - Business registration certificate: No 0107683084 issued by Hanoi City Department of Planning – Investment for the first time dated 27/12/2016. - Address: No 72 Nguyen Chi Thanh, Hanoi - Main business lines: Hospital and clinics activities; Whole sales of pharmaceuticals and medical equipment; sales of food; Production of medicines, pharmaceuticals and chemical; Construction of other civil engineering works; Activities of hospitals and clinics

35,000 51% 0 0 0 0

B Associates

1

Thai An Real Estate JSC - Business registration certificate: No 0104349719 d issued by Hanoi City Department of Planning – Investment for the first time dated 25/12/2009 and for the 4th change time dated 18/05/2011. - Address: B1-24 Le Duc Tho Street, My Dinh

25,020 30% 178,618 144,952 -246 -246


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Commune, Tu Liem, Hanoi - Main business lines: Construction of traffic, irrigation, infrastructure, real estate business works

2

Thang Long TASCO Joint Stock Company - Business registration certificate: No 0104328839 (Old No 0103043065) issued by Hanoi City Department of Planning – Investment for the first time dated 23/12/2009, for the 1st change time on 23/7/2010 - Address: No 64, Building TT4, Song Da – My Dinh urban area, My Dinh Commune, Tu Liem District, Hanoi City - Main business lines: Real estate business; Real estate management; Real estate advertisement; Real estate consultancy; Valuation of real estate; Real estate brokerage;

4,237 30% 4,300 0 -2 -2

3

D-tech Joint Stock Company - Business registration certificate: No 0104822759 issued by Hanoi City Department of Planning – Investment for the first time dated27/7/2010, for 2nd change time on 16/9/2011. - Address: House No A3, Compound of Hanoi University of Mining and Geology, Dong Ngac Commune, Tu Liem District, Hanoi City. - Main business lines: Business, sales of construction materials, equipment and machinery, construction of infrastructure, housing works and etc.

10,000 20% 15,186 0 0 0


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4

Thang Long Joint Stock Corporation - Business registration certificate: No 0100105020 dated May 28, 2014 and business registration certificates for the 1st to 06th change times issued by Hanoi City Department of Planning and Investment. - Address: No 72, Nguyen Chi Thanh Street, Lang Thuong Ward, Dong Da District, Hanoi City - Main business lines: Construction of traffic infrastructure, civil works; Production and manufacture of metal components and etc.

419,080 35,4% 1,779,917 2,143,895 68,052 66,304

5

Hung Thang – Phu Tho BOT Company Limited - Business registration certificate: No 2600940457 issued by Phu Tho Province Department of Planning and Investment dated 26/5/2015 - Address: Zoone 12, Co Tiet Commune, Tam Nong District, Phu Tho Province - Main business lines: Construction of railways and roads; business and exploitation of road infrastructure.

230,000 30% 1,006,933 0 0 0

7.2. Typical investment projects:


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4

INVESTMENT PROJECTS

REAL ESTATE PROJECTS 1

HEALTH CARE PROJECTS

2

AUTOMATIC TOLL COLLECTION SYSTEM 3

TRAFFIC INFRASTRUCTURE PROJECTS


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Nam Tu Liem District • Foresa Villa • Xuan Phuong

Residence • Foresa My Dinh • Foresa Tay Mo

(ongoing)

Hoang Mai District • South Building Phap Van

Cau Giay District • 48 Tran Duy Hung • Housing zone for employees of

Ministry of Foreign Affairs • Tasco Office

Until now, 90% of Tasco's ongoing real estate projects are located in the West of Hanoi - the city's real estate hotspot, which includes two districts: Nam Tu Liem & Cau Giay.


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FORESA VILLA – XUAN PHUONG ECOLOGICAL URBAN AREA

• Location: Xuan Phuong Ward, Nam Tu Liem District, Hanoi City

• Area: 38ha

• Scale: 813 low-rise houses (single, duplex villas, adjacent houses, shop-house)

• E-commerce: 1.800 billion dong

• Implementation value until 31/12/2016: 1.406 trillion dong

• Functions: Foresa Villa is located in the heart of Nam Tu Liem district, the first eco-urban area in Hanoi to bring back the green nature like the forest to the city, with a central park of over 4 hectares. The building density is low 30%, with large area of greenery system. Foresa residents not only enjoy the fresh green space but also benefit from the perfect infrastructure and convenient internal facilities. • Project progress: 501/535 units have been sold and handed over to customers. Expected completion of sales and delivery in Q2 / 2017


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XUAN PHUONG RESIDENCE • Location: Xuan Phuong Ward- Nam Tu Liem District - Hanoi City

• Area: 3.95 ha

• Scale: 6 17-floor apartment buildings, 126 adjacent houses

• E-commerce: 1,100 billion dong

• Implementation value until 31/12/2016: 453 billion dong

• Functions: Xuan Phuong Residence is a modern apartment building complex located in the heart of Nam Tu Liem District, with flexible apartment design that utilizes natural light and maximizes airiness. The project combines outdoor playground for children in the small green space arranged interwoven among the buildings, which brings quiet, peaceful living spacel for the residents. • Construction progress: - High – rise building:

+ 17 – floor towers E, F: Being completed to deliver to the customers since QII/2017 and 234/234 units of the entire project were sold. + 17- floor Towers A, B, C, D: 5th floor are completed: It is expected in May, 2017, make roof of the 17th floor and in the beginning of December, 2017, deliver to the customers. Have sold 402/408 units, it is expected to complete sales in Q1/2017. - Low – rise house: Deliver to the customer in December, 2016 and 126/126 units were sold.


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SOUTH BUILDING • Location: Phap Van - Tu Hiep New Urban Area, Hoang Mai District, Hanoi

• Area: 2,173 m2

• Scale: 16-floor building

• E-commerce: 211 billion dong


• Functions: Located in a prime location in Phap Van urban area in South Hanoi, adjacent to Yen So Green Park,South Building is an outstanding apartment project with perfect infrastructure and fresh living environment. It includes the local existing amenities, with 140 100% natural light-exposed units, and 2 large basements for parking lots. South Building is the place to start great life in the future.

• Project progress: Completed construction of the fifth floor of the project, expected to complete raw parts until paril, 2017 and until Q4/2017, deliver units to customers in the project.

• Sales progress: Make sales and contracts with customers for 83/140 units, the remaining apartments are expected to be sold in the second quarter of 2017.


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FORESA MY DINH • Location: Xuan Phuong Ward - Nam Tu Liem District - Hanoi

• Area: 49ha

• Scale: 660 low-rise apartments (single, duplex, adjacent houses, shop-house)

• e-commerce: expected 3,000 billion dong


• Functions: Foresa My Dinh continues to inspire the Forest of the City with its unique location in the green oasis in the heart of the urban area and complete internal facilities. All of the VIP villas of Foresa My Dinh overlooking the fountains creates harmony feng shui with great beauty. The high density of green trees with the green architecture on the façade and flexible design of each villa will surely satisfy future residents.

• Project progress: It was assigned by People's Committee of Ha Noi City to reimburse Le Duc Tho BT project and approve the 1/500 master planning. Currently, ihe project is submitted to the City's People's Committee for approval and it is expected to implement the project site clearance from Q2 / 2017 and carry out the construction of the infrastructure and raw parts since Q3/2017.


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48 TRAN DUY HUNG PROJECT • Location: Trung Hoa Ward, Cau Giay District, Hanoi

• Area: 2.800m2

• Scale: 25-floor building

• e-commerce: 500 billion dong


• Functions: 48 Tran Duy Hung building is a luxury apartment project with offices for rent in the center of Hanoi. With the advantage of location and perfect connectivity infrastructure, the project is expected to bring a new highlight and the choice of many customers and companies.

The company is adjusting the product segment of the project from the mid-level to the high-end segment. The project has been approved by the state agency for agreement on the site and architectural adjustment of the project, it is expected in 4/2017 to commence the project.

PROJECT ON CONSTRUCTION OF HOUSES FOR EMPLOYEES OF MINISTRY OF FOREIGN AFFAIRS

• Location: Tran Quoc Hoan Street, Cau Giay District, Hanoi

• Area: 13,770m2

• Size: 2 27-floor building

• e-commerce: 1,500 billion dong

• Functions: With modern design and central location, Project of Houses for employees of Ministry of Foreign Afffairs impresses customers with the perfect utilities to the busy shopping stores, swimming pool, gym, overhead public area, children's playgrounds and etc. • The company is currently completing legal procedures with government agencies and is expected to start construction of the project in Q4/2017.


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TRAFFIC INFRASTRUCTURE INVESTMENT PROJECTS

TASCO is known as a reputable investor in traffic infrastructure fields in the forms of BOT and BT with construction of many key roads in the Northern and Central region of Vietnam

PROJECT ON RENOVATION, UPGRADE OF NATIONAL ROAD 10 CROSS HAI PHONG CITY (BOT CONTRACT)

PROJECT ON INVESTING CONSTRUCTIONG OF NEW ROAD CROSS PHU LY – MY LOC

PROJECT ON RENOVATION, UPGRADE OF NATIONAL ROAD 1 (BT CONTRACT)

PROJECT ON RENOVATION, UPGRADE OF NATIONAL ROAD 10 CROSS THAI BINH PROVINCE (BOT CONTRACT)

PROJECT ON UPGRADE OF PROVINCIAL ROAD 39B IN THAI BINH (BT CONTRACT)

PROJECT ON CONSTRUCTION OF LE DUC THO STREET TO ROAD 70 (BT CONTRACT)


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BOT Project in Quang Binh Province (Upgrading and extending the National highway no.1)

BOT Project for the National highway no.1 (Quan Toan – Cau Nghin)

• Total investment of the project: VND 2.000 billion

• Scale of the road: standard secondary main urban road+ road grade III,

delta

• Payback period of the project: 17 years from 7/2015.

• Profit of investor: 11,5%/ Owners' equity/Year


• Scale of the road: secondary main urban road+ road grade III, delta

• Implementation period: 2015-2017

• Payback period of the project: 16 years from the commencement of fare

collection

• Profit of investor: 11,5%/ Owners' equity /Year

• Expected date for fare collection: July 2017, exceeding 6 months in

comparison with the signed BOT contract


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BOT Project no.39 (Thanh Ne, Diem Dien, Thai Binh Province)

BT Project in Le Duc Tho

(The segment from Le Duc Tho street to Road no.70) • Total investment of the project: VND 550 billion

• Scale of the project: total length of route: 16,62 km, road grade 2, delta

• Payback period: 18 years from 01/2017

• Profit of investor: 11,5%/ Owners' equity


• Total length of route: 3,5 km; urban road

• Expected completion date: 2nd Quarter of 2017

• Reciprocal projects to reimburse the project:

Foresa Villa

48-storey Building Project in Tran Duy Hung

Foresa My Dinh


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TOLL COLLECTION TECHNOLOGY

VETC Joint Stock Company - a subsidiary company of Tasco, was established with

the goal of becoming an investor and operator of the electronic toll collection system

(ETC) on the basis of RFID technology (American technology). The desire of

VETC is to bring a solution to toll collection which is applied moderm technology

to accelerate development of the transport in particular and the economy in general.

Implementation progress: • Equipment has been completed installing at 10 toll stations of the project.

• ETC has been put into operation at 07 stations.

• In 2017, it is expected to complete installing all equipment and put ETC

into operation at all stations within the project of toll collection in 1st phase

(28 stations).

• In addition, in order to expand and develop customers, it is expected that in

2017, 10 stations more will be deployed beside the project.

Sales activities (sticking E-tags): the company has signed the contract of sticking

e-tags with the Register and 77 registry centers. In addition, the company has also

directly signed and stuck e-tags with enterprises and individual business households

throughout the country.

• Up to now, about 60.000 e-tags have been sticked.

• It is expected that by 2017, 550.000 e-tags will be sticked.


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HEALTH CARE INVESTMENT - Since the end of 2012, Tasco has started to deploy investment research

in combination with Public Hospitals, to organize visit and study tours

in many places in the world such as France, Germany, Switzerland,

Japan, South Korea ..., with a budget of about 10 billion VND, in order

to meet the demand of high quality medical examination and treatment

of people. This is an investment project with a lot of social meanings,

reflecting the contribution of the enterprises to the country. Tasco's

Medical Investment field is managed by T'Hospital, a subsidiary

company wholly-owned by Tasco.

- Tasco has cooperated with some public hospitals in Hanoi.

- On 21/4/2017 "Hanoi Eye Hospital II" was opened and started

treatment, address: 72 Nguyen Chi Thanh, Lang Ha Ward, Dong Da

District, Hanoi. Estimated annual revenue is over VND 100 billion.

- Revenue from medial investments will come mainly after 2018.


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8. Business plan for 2017: Since 2016, the company has expanded its business into the real estate business. Although

being a new one in this field, the company has quickly developed to become an enterprise having a standing in the real estate market in Hanoi. All projects involved by Tasco are relatively well located in new districts of Hanoi and are expected to bring significant profits to the company with strong support from the traditional transport infrastructure.

According to urbanization strategy of the Government, the demand for housing construction up to 2020 must reach the average housing area target of 18-20m2 per person following the housing development program to provide residences matching with social objects with different needs and income levels. Construction of public works ensures 3-5m2 of land per person, satisfies material and spiritual needs of people in each urban area, 5% of urban land fund is used for construction of public works. According to the above trend, the housing demand in Hanoi capital in the coming years is still very great, facilitating the sustainable and stable development of the Company.

With increase in urbanization speed, the real estate sector is forecasted to have a great deal of development potential. Especially since the end of 2013, the real estate market has been showing signs of recovery and good growth in housing segment for the low- and middle-income people.

In order to help the company develop in accordance with development trend of the economy, in the following years, the Board of Directors has the following business development plans:

-Build company’s brand and culture to create foundation for building the labor team with the style and culture of Tasco, make Tasto the second home as well as the common home of its own labors.

-Build human resources strategy, plan human resources in each development stage of the company and give appropriate policies and treatment regimes to attract talents. Human factor is identifed as the most important resource in all resources to develop business as well as the critical factor to determine the survival and growth of the company.

-Establish and fulfill the system of management regulations so that the Board of Management can control all activities of the Board of Directors, monitor financial investments in its subsidiaries through a control system by management regulations and operation of the audit system.

Organizational structure: the Company operates based on the model of holding company- subsidiary company. For large projects, the Company will contribute capital to set up subsidiaries to implement these project.

-Build, apply, maintain and continuously improve the quality management system in the whole company, fulfill all procedures to match with real conditions of bussiness and production.

-All are for customers: be always whole-hearted for customer satisfaction, build relationships with customers to increase value, benefit and always exceed customers’ expectations.

- The development orientation of the company mentioned above is consistent with the current development orientation of the sector and the economy.


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III. ADMINISTRATIVE REPORT:

1. Board of Management:

1.1. List of the Board of Management: (see page no.9) 1.2. Activities of the Board of Management:

In 2016, the Chairman of the Board of Management managed and directed the Company's development strategy in order to ensure activities of the Board of Management in accordance with the laws and regulations of the Company, complying with the guidelines and orientations set forth by the General Shareholders Meeting, Board of Management and modern management practices.

Each member of the Board of Management performed his/her own duties in management and supervision of activities of the Board of Management in each field.

Members of the Board of Management includes specialized members of the Board of Management and some other members, perform weekly meetings to deal with tasks under the the Chairman’s authority and duties assigned by the Board of Management, simultaneously, be proactively side by side with the Board of Management to handle all issues related to production and business activities of the Company.

Through weekly meetings, each specilized member of the Board of Management has strengthened supervision of the Board of Directors’ activities and other managers to ensure that Company's activities are safe and comply with the laws, implement resolutions of the General Shareholders Meeting and the Board of Management.

Thanks to the capacity, experience and wisdom of each member, the quality of the Board of Management' activities has been more and more improved, creating a democratic working environment, promoting the collective strength in making more decisions to timely respond requirements of production and business activities of the Company.

In 2016, the Board of Management held 72 meetings and consulted in writing; issued 45 Resolutions, 21 Decisions for strategic planning, making decisions timely and suitable with actual conditions of the company as well as market happenings and actively support the Board of General Director in implementing the business plan in 2016 assigned by the General Shareholders Meeting. All meetings of Board of Management had minutes to fully and truthfully record all opinions of the Board of Management’s members, Resolutions on issues agreed by the Board of Management and Decisions of Board of Management to specify contents in the Resolution, specified as follows:

No. Member of the Board of Management Position

Number of meetings

attended and consulted in

writing

Rate of meeting

attendance (%)

1 Mr. Pham Quang Dung Chairman of the Board of Management

72 100,0

2 Mr. Pham Van Luong Vice Chairman of the Board of Management

72 100,0

3 Mr. Vu Quang Lam Member of the Board of Management

72 100,0


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No. Member of the Board of Management Position

Number of meetings

attended and consulted in

writing

Rate of meeting

attendance (%)

4 Ms. Tran Thi Thanh Tan Member of the Board of Management

72 100,0

5 Ms. Pham Thi Nhan Member of the Board of Management 72 100,0

6 Mr. Nguyen Ngoc Hung Member of the Board of Management 71 98,6

7 Ms. Pham Thi Chi Member of the Board of Management 72 100,0

8 Mr. Hoang Trung Dung Member of the Board of Management 34 47,2

Resolutions/ Decisions issued by the Board of Management in 2016:

No. Code of the Resolutions/

Decisions Date Contents

I. Resolutions of the Board of Management 1 01/NQ-HĐQT 11/01/2016 Approval for solutions to odd shares

2 02/NQ-HĐQT 06/01/2016 Adjustment of regulations on travel, visit, vacation on Tet Holiday

3 01A/NQ-HĐQT 22/01/2016 Resolutions on organizing charity program in Nam Dinh and Ha Noi

4 01C/TASCO-HĐQT 16/01/2016 Funding the program "Love Bridge"

5 03/NQ-HĐQT 22/01/2016 Approval for solutions to the shares which shareholders denied buying

6 04/NQ-HĐQT 02/02/2016 Approval for advance payment of cash dividend and issue of shares for current shareholder

7 05/NQ-HĐQT 02/02/2016 Use of the Development Investment Fund and current surplus of capital stock in the Financial Report which has been audited on 30/6/2015

8 06/NQ-HĐQT 31/03/2016 Adjustment of the company’s organizational chart 9 07/NQ-HĐQT 08/04/2016 Extension of the time of issuing shares to the public

10 08/NQ-HĐQT 15/04/2016

Extension of time of registering to buy and paying for the shares issued to current shareholders according to the final registration list on 25/2/2016 in period of share issuance for capital increase in 2016


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11 08A/NQ-HĐQT 20/04/2016 Establishment of T'Hospital Limited Company

12 09/NQ-HĐQT 25/04/2016 Approval for organization plan and contents of the Annual Shareholdings Meeting in the fiscal year of 2015

13 10/NQ-HĐQT 25/04/2016 Issuance of contents and responsibilities of Divisions/ departments of the Company according to the organization chart of the Company

14 11/NQ-HĐQT 11/05/2016 Establishment of Tasedu Training and Consulting Limited Company

15 12/NQ-HĐQT 25/05/2016

Distribution of the shares which were not sold in the period of shares offering for chapter capital increase of the company following resolutions of the extraordinary Shareholders Meeting in 2015

16 13/NQ-HĐQT 02/06/2016 Approval for loan of Dong Hung BOT project

17 14/NQ-HĐQT 22/06/2016 Funding the Association of Promoting Education of Nam Dinh Province

18 15/NQ-HĐQT 14/06/2016 Approval for contents adjustment of repurchasing before due date for convertible bond HUT-CB2015

19 16/NQ-HĐQT 09/07/2016 Payment of dividends in cash (2nd time) 20 16/TASCO-HĐQT 04/08/2016 Management, administration in TASCO system

21 17/NQ-HĐQT 06/08/2016 Support of money to use for expansion, upgrade and renovation of main roads in Hamlet no.12, Hai Trung, Hai Hau, Nam Dinh Province.

22 17/2016/NQ-HĐQT 23/08/2016

Signing the Contract Addendum for the bypass road project in Dong Hung, Thai Binh Province at the loan interest rate as specified in Circular No. 55/2016/ TT-BTC.

23 18/2016/NQ-HĐQT 26/08/2016

Acceptance of contributing capital investment in Phu Man Golf Course Project with Hung Thang Investment Joint Stock Company up to 40% of owner’s equity to invest in the project.

24 19/2016/NQ-HĐQT 09/09/2016 Approval for the implementation date of converting convertible bond HUT-CB2015 into shares in 1st time

25 20/2016/NQ-HĐQT 12/09/2016 Payment of remuneration for members of the Board of Management and the Supervisory Board of TASCO in 2015

26 21/2016/NQ-HĐQT 12/09/2016 Adjustment of implementation time of the project: investment and construction of the road from Le Duc Tho to Road no.70


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27 22/2016/NQ-HĐQT 12/09/2016 Approval for sales policy of self-business products of TASCO- People's Newspaper Project

28 23/2016/NQ-HĐQT 16/09/2016 Brokerage fees for finding BOT project transfer partners

29 24/2016/NQ-HĐQT 16/09/2016 Implementation of electronic toll collection at toll booths invested by TASCO

30 25/2016/NQ-HĐQT 24/09/2016 Approval for list of bond creditors who registered to convert bonds into shares

31 26/2016/NQ-HĐQT 06/10/2016 Establishment of Tasco service company

32 27/2016/NQ-HĐQT 11/10/2016 Funding support of housing for the people who contributed to the revolution within Ha Noi City

33 28/2016/NQ-HĐQT 15/10/2016 Plan of ETC commissioning at tool booths

34 29/2016/NQ-HĐQT 03/11/2016 Dismissal and appointment of members of the Membership Council of T'Hospital Limited Company

35 30/2016/NQ-HĐQT 14/11/2016

Appointing Ms. Pham Thi Nhan as a member of the Board of Management of VETC, replacing Mr. Vu Quang Lam, member of the Board of Management of VETC

36 31/NQ-HĐQT 14/11/2016 Adjustment of organization chart of Tasco Joint stock company

37 32/2016/NQ-HĐQT 14/11/2016 Appointing Mr. Trinh Xuan Nam to take up the position of Chairman of the transport infrastructure project enterprises

38 33/2016/NQ-HĐQT 15/11/2016 Business Plan and Sales Policy for the remaining products at the FORESA VILLA Project

39 34/2016/NQ-HĐQT 24/11/2016 Investment in Vietcombank bonds

40 35/2016/NQ-HĐQT 24/11/2016 Addition of sale products under Xuan Phuong Project and adjustment of commission rate

41 36/2016/NQ-HĐQT 06/12/2016 Allocation of responsibilities and accounting methods for BOO Project

42 37/2016/NQ-HĐQT 15/12/2016 Approval for detailed price list of the products under South Building Project

43 38/2016/NQ-HĐQT 15/12/2016 Deployment of Tasco Brand Strategy Development Project

44 39/2016/NQ-HĐQT 26/12/2016

Approval for guideline of investment cooperation with Manpower supply & trade JSC (SONA) for project development at lot E2, new urban area in Cau Giay, Cau Giay District, Ha Noi City

45 40/2016/NQ-HĐQT 31/12/2016 Approval for BSC 2017 of companies within Tasco


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system

II. Decisions of the Board of Management

1 01/QĐ-HĐQT 06/01/2016 Support to Trung Hoa Ward 2 02/QĐ-HĐQT 06/01/2016 Approval for the system of job titles

3 03/QĐ-HĐQT 25/01/2016 Approval for changing the representative person of as authorized by Tasco in Nam Dinh Province

4 04/QĐ-HĐQT 20/02/2016 Addition of business line for Tasco 6

5 04A/QĐ-HĐQT 20/02/2016 Decision of tasks assignment for Tasco 6 Limited Company

6 05/QĐ-HĐQT 25/01/2016 Decision of dismissal for the representative person as authorized by Tasco in Nam Dinh Province

7 06/QĐ-HĐQT 21/03/2016 Increasing charter capital in Tasco 6 to 65.13 billion

8 07/QĐ-HĐQT 13/04/2016 Increasing charter capital in Tasco Quang Binh to 328 billion

9 08/QĐ-HĐQT 20/04/2016 Establishment of T'Hospital Limited Company, The representative person as authorized by Tasco in T'Hospital

10 09/QĐ-HĐQT 11/05/2016 Appoitment of Ms. Tam, director of TASEDU Company

11 10/QĐ-HĐQT 02/06/2016 Decision of the regulations on decentralization amended in 2nd time

12 11/QĐ-HĐQT 06/06/2016 Decision on changing the business registration of Tasco Joint Stock Company (increasing charter capital to 1684 billion)

13 12/QĐ-HĐQT 13/06/2016 Change in legal representative person (Director) of Tasco Hai Phong

14 13/QĐ-HĐQT 05/07/2016 Decision on selection of Auditing Company for the Financial Report in 2016

15 14/QĐ-HĐQT 15/08/2016 Issuance of regulations on decentralization amended in 3rd time

16 15/2016/QĐ-HĐQT 16/09/2016 Internal issuance of cost norm of TASCO, amended in 1st time

17 16/QĐ-HĐQT 26/09/2016 Decision on changing the business registration of Tasco Joint Stock Company (increasing charter capital to 1.763 billion)

18 17/QĐ-HĐQT 24/10/2016 Decisions on issuance of job descriptions and Capacity standards of the Auditing Division

19 18/2016/QĐ-HĐQT 03/11/2016 Dismissal of the director of T'Hospital Limited Company


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20 19/QĐ-HĐQT 07/11/2016 Decision on issuance of emulation and commendation criteria for the year

21 20/2016/QĐ-HĐQT 15/12/2016 Contribution of capital to establish, appointment of authorized representative at Hanoi Eye Hospital Joint Stock Company

1.3. Sub-committees under the Board of Management:

No. Sub-committee Main duties

1 Strategy and investment subcommittee

- Orientate development and propose approval for overall strategy; - Monitor the implementation of the strategy, approve periodic reports on strategic issues and investment; - Discuss and propose approval for business plans for the company and its subsidiaries; - Propose approval for investment projects under the authority (according to the mechanism of decentralization); - Orientate development and set targets for the company; - Propose approval for financial plan and allocation of funds; - Supervise performance effectiveness in comparison with targets/ plans;

2 Human resources and remuneration subcommittee

-Build strategies for human resource development (recruiting, retaining talents, policy of salary, reward/ treatments) - Monitor and evaluate work performance of key individuals and balance between work efficiency and treatment policies; supervise the construction and operation of the salary, reward system; -Assist the Board of Management in proposing and selecting candidates for executive positions and positions of the Board of Management upon request; - Monitor and plan for the development of legacy personnel

3 Auditing subcommittee

- Assist the Board of Management in supervising performance efficiency of the company; - Manage and control the audit work; - Propose, hire independent auditing services for annual financial reports auditing; - Propose, hire independent auditing services to audit, evaluate the internal control system as required by the Board of Management; - Review and evaluate the risks management of management levels to be able to provide early warnings; - Support to develop and approve strategies, policies, risk management mechanisms;

4 Culture and morality of the

-Orientate, build culture of the company -Ensure that the company can comply with ethical standards and


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No. Sub-committee Main duties

company contribute to building a trusting atmosphere within the company. - Detect and prevent company violations of the law and ethical standards.

In 2016, the subcommittees under the Board of Management were responsible for supervising production and business activities of the Board of Directors. Specified as follows:

- Supervising the implementation of strategies; - Supervising the operation of the personnel evaluation system; - Supervising the implementation of investment projects - Supervising the implementation of Resolutions of the General Assembly of Shareholders

and the Board of Management. Each member of the Board of Management always perforMs. their own duties and promotes

the role of subcommittees in the management and supervision of business activities of the Board of General Directors to ensure that the Board of Directors manages in accordance with the company’s culture, core values and the legal regulations. 1.3. Evaluation of the Board of Management on the activities of the Company:

- Regarding results of production and business activities: In the context that the economy has a large number of positive changes, the Board of Management has set out guidelines and policies to determine key targets, change organizational structure and human resources system. Therefore, the Company has operated and run business very stably, reached the proposed plans.

- Regarding operation of the subcommittees: to assist the Board of Management in guiding, managing and supervising activities of the Board of General Directors, Board of Management has established the Strategy and Investment Subcommittees; Human Resources and Remuneration Subcommittee; Internal Audit Subcommittee and Subcommittee of Culture. These subcommittees have promoted their roles. 1.4. Evaluation of the Board of Management on the activities of the Board of General Directors of the Company:

- In the past year, with the positive changes as well as challenges also of the economy, the Board of General Directors has made efforts in the management and operation of production and business of the company in accordance with provisions of the laws, regulations and decisions of the General Assembly of Shareholders and the Board of Management.

- However, the Board of General Directors needs to pay more attention, perform the work assignment better and authorize subordinates to reduce the workload, focus on the management to improve the performance of business operations.

- At the same time, the Board of General Directors needs to focus more on internal training to improve capacity of employees in the Company.

The Board of Management regularly supervises the Executive Board to implement the Resolutions and Decisions issued by the General Meeting of Shareholders and the Board of Management.

In 2016, the Board of Management made strategic decisions, directed and supervised the Board of Directors to accomplish the following tasks:

- Approval of business plans and orientations for 2016-2020. - Adjustment of the organizational chart of responsibilities and duties of departments in line with the development orientation of the company.


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- Adjustment of regulations on decentralization, cost norms, internal mechanism to improve labor productivity - Approval of sale policies of real estate projects - Issuance of shares for current shareholders to increase charter capital from 1.284 billion to 1.684 in 2016 - Dividend payment in 2015 in cash 2 times with the rate of 12% - Inspection and supervision of the progress and quality of investment projects in Xuan Phuong eco-housing area, the project of building residences for officials of the Central Party Office and the People's Newspaper, Hai Phong BOT project in the National Highway no.10, Phu Tho BOT project no. 32… - Signing the contracts of: electronic toll collection and vehicle weight control throughout the country project - stage 1: applies to National Highway no.1 and Ho Chi Minh Road crossing the Central Highlands in the form of BOO contract; additional investment of bypass road in Dong Hung town, Thai Binh Province on the National Highway no. 10 added into the National Highway no.10 (KM92+900-KM98+400) upgrading project from La Uyen bridge to Tan De bridge, Vu Thu district, Thai Binh province in the form of BOT contract; signing credit contracts to implement the above projects - Establishment of T'Hospital Limited Company and Tasedu Training and Consulting Limited Company; - Successfully converting 79,120 HUT-CB2015 bonds into shares, equivalent to 7.912.000 shares (HUT). - Repurchasing VND 155.280.000.000 of HUT-CB2015 bonds before due date, reducing bond debit balance to VND 265.6600.000.000 billion.

1.5. Plans and orientations of the Board of Management in 2016: In 2016, the Board of Management orientates that: the company's strategy is to focus on

transport infrastructure projects, real estate investment projects; new construction works will be transferred to Thang Long Corporation to implement, focus on seeking strategic investors, new investment opportunities, ensuring the company's revenue plan, as well as the interests of shareholders and investors.

- Subcommittees: Strategy and Investment Sub-Committee; Human resources and Remuneration Subcommittee; Internal audit Subcommittee and the Culture Subcommittee need to supplement with staff to further promote the role of assisting the Board of Management in guiding, managing and supervising the Board of General Directors.

- Continue to upgrade the internal control system (based on the completion of KPMG's consultancy project) and put the risk management system into practice;

- Uniformly operate the human resource assessment system to ensure equity in order to increase labor productivity and create motivation for employees;

- Focus on directing and supervising the Board of General Directors to build and communicate culture of the company according to the roadmap;

- Strengthen cooperation with domestic and foreign partners in order to seek capital, business cooperation opportunities;

- Develop, fulfill and apply policies for strategic investors, as well as policies for individuals, organizations consulting and introducing strategic investors.


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1.6. Transactions, remuneration and benefits of the Board of Management, the Board of Directors and the Supervisory Board in 2016:

- In 2016, the Company paid remuneration for the Board of Management and the Executive board equivalent to VND 4.970.506.335.

2. Board of Supervisors:

2.1. Information about members of the Board of Supervisors: Members of the Board of Supervisors include:

- Mr. Pham Huy Hoang - Chief Supervisor

- Mr. Pham Hong Diep - Member

- Mr. Nguyen Van Doan - Member

2.2. Supervision of the Board of Supervisors towards the Board of Management, Board of General Directors and shareholders:

a. Supervision: The Board of Supervisors representing the shareholders regularly supervised the entire

business operations of the Company, supervised the Board of Management and General Director in operating and managing the Company.

Quarterly, the Board of Supervisors held a meeting and assessed activities of the Company, set out specific supervisory tasks of each member for each quarter and issues to be supervised, specially, supervising the implementation of regulations, supervising the financial management… through the Charter, resolutions of the Board of Management, the management of the Board of General Directors and the accounting books of the quarters and years.

The Board of Supervisors frequently contacted and received the information from shareholders; seriously considered the opinions of shareholders and gave comments to the Board of Management for timely settlement.

b. Coordination of activities of the Board of Supervisors with activities of the Board of Management, Board of General Directors and other managers:

The Board of Supervisors proactively worked closely with the Board of Management and Board of General Directors in inspecting and supervising all production and business activities of the Company; regularly exchanged the information and relevant documents

The Board of Supervisors also gave many comments to the Board of Management, Board of General Directors on the implementation of production and business plans, as well as on finance and accounting.

The Board of Management and the Board of General Directors regularly create favorable conditions for the Board of Supervisors to collect information and documents relating to the production and business activities of the Company.

3. Training in corporate management:

In 2016, members of the Board of Management, members of the Board of Supervisors, Board of General Directors and managers... attended about 40 training sessions and seminars on corporate management, with the following outstanding programs:

- Risk management and Internal control standards COSO;


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- Development of effective integrated marketing communications strategies; - Sales and unsurpassed customer service;

- Art of Human resource management;

- Change management;

- The Fourth Industrial Revolution;

- The Seminar: "Current affairs of the economy in Vietnam and in the World and investment opportunities of enterprises in 2016"…

IV. INFORMATION ON SHARES AND INVESTORS RELATIONS:

1. Shares:

- Name: Shares of Tasco Joint Stock Company - Stock code: HUT - Fare value: VND 10,000/share - Total number of outstanding shares at 31/12/2016: 176,329,416 shares In which:

STT Types of shares Number of outstanding shares

1 Transferable shares 154,366,416

2 Restricted shares 21,963,000

Total 176,329,416

2. Shareholder structure, change of owner's investment capital:

2.2. Shareholder structure: - Classification of shareholders in proportion of ownership:

No. Shareholders Number of shares Capital

contribution ratio (%)

1 Shareholders holding 5% of ownership ratio or more (major shareholder)

33,281,784 18,87%

2 Shareholders holding under 5% of ownership ratio or less (small shareholders)

143,047,632 81,13%

- Classification of shareholders under organizational and individual criteria:



1 Shareholders as organizations 32,951,432 18,69%

2 Shareholders as individuals 143,377,984 81,31%

- Classification of domestic and foreign shareholders:


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1 Domestic shareholders 147,675,165 83,75%

2 Foreign shareholders 28,654,251 16,25%

- Classification of State shareholders and other shareholders:



1 State shareholders 0 0%

2 Other shareholders 176,329,416 100%

2.3. The situation of changing the owner's investment capital: Unit: VND million

Time Charter

capital from time to time

Added value from time to

time Method of increasing charter capital

May 2016 1,684,175 400,127 - Issuance of shares to existing shareholders

October 2016 1,763,294 79,120 - Conversion of HUT-CB2015 bonds into shares for the first time.

2.4. Transaction of treasury shares: None

2.5. Other securities: The number of bonds converted into outstanding shares at 31/12/2016:

No. Type of bond Number of outstanding bonds

1 Convertible bonds 265,600

2 Inconvertible bonds -

Total 265,600

3. Share ownership ratio of insiders:

No. Full name Position Number of shares held Ratio (%)

I. Board of Management 34,923,161 19.81% 1 Pham Quang Dung Chairman 15,448,948 8.76% 2 Pham Van Luong Vice Chairman 7,116,184 4.04 % 3 Pham Thi Chi Member 755,000 0.43 % 4 Vu Quang Lam Member 4,925,515 2.79 % 5 Pham Thi Nhan Member 2,619,207 1.49 %


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No. Full name Position Number of shares held Ratio (%)

6 Tran Thi Thanh Tan Member 2,998,730 1.70 % 7 Nguyen Ngoc Hung Member 1,059,577 0.60 % 8 Hoang Trung Dung Member - -

II. Board of Supervisors: 845,554 0.48% 9 Pham Huy Hoang Chief Supervisor 6,545 0.00 % 10 Pham Hong Diep Member 832,290 0.47 % 11 Nguyen Van Doan Member 6,719 0.00 %

III. Executive Board: 2,175,220 1.23% 12 Hoang Ha Phuong General Director 1,097,000 0.62 % 13 Nguyen Dinh Sieu Deputy General Director 207,200 0.12% 14 Truong Van Thinh Deputy General Director 705,600 0.40% 15 Nguyen Dinh Dung Deputy General Director - - 16 Tran Thi Thanh Chief Accountant 165,420 0.09%

Total 37,943,935 21.52%

TASCO JOINT STOCK COMPANY ANNUAL REPORT 2016

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4. Information on share transactions with internal shareholders:

No. Transactors Relationship with insiders

Beginning shares owned Ending shares owned Reasons for increase or decrease

(purchase, sale, conversion, bonus...) Number of share Ratio

Number of share Ratio

1 Pham Quang Dung Chairman of the Board of Management

7,264,088 5,657 15,448,948 8.761

Exercise rights to purchase additional shares issued to existing shareholders Repurchase shares redistributed from shares not sold out.

2 Pham Thi Chi Member of the Board of Management

- - 755,000 0.428 Repurchase shares redistributed from shares not sold out.

3 Le Quan Can Member’s husband of the Board of Management

3,549,940 2.765 5,643,740 3.201


4 Pham Van Luong Vice Chairman of the Board of Management

4,185,991 3.260 7,116,184 4.036 Exercise rights to purchase additional shares issued to existing shareholders

5 Vu Quang Lam Member of the Board of Management


6 Pham Thanh Tam Member’s wife of the Board of Management

2,299,136 1.791 4,120,136 2.337


7 Pham Thi Nhan Member of the Board of Management



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(purchase, sale, conversion, bonus...) Number of share Ratio Number of

share Ratio

8 Tran Hai Yen Member’s child of the Board of Management

- - 1,000,000 0.567 Repurchase shares redistributed from shares not sold out.

9 Pham Thanh Liem Member’s brother of the Board of Management


10 Tran Thi Thanh Tan Member of the Board of Management


11 Vu Duy Loc Member’s child of the Board of Management


12 Nguyen Ngoc Hung Member of the Board of Management

96,857 0.075 1,059,577 0.601


13 Hoang Ha Phuong General Director - - 1,097,000 0.622 Repurchase shares redistributed from shares not sold out.

14 Do Thi Thuy Hang Wife of General Director

336,000 0.262 493,344 0.280 Exercise rights to purchase additional shares issued to existing shareholders

15 Trinh Xuan Nam Deputy General Director - - 450,000 0.255

Repurchase shares redistributed from shares not sold out.

16 Nguyen Dinh Sieu Deputy General Director

67,200 0.052 207,200 0.118 Repurchase shares redistributed from shares not sold out.


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(purchase, sale, conversion, bonus...) Number of share Ratio Number of

share Ratio

17 Truong Van Thinh Deputy General Director


18 Tran Thi Thanh Chief Accountant 5,420 0.004 165,420 0.094 Repurchase shares redistributed from shares not sold out.

19 Pham Hong Diep Member of the Board of Supervisors



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V. SUSTAINABLE DEVELOPMENT: For employees: At Tasco Joint Stock Company, human resources are a very valuable asset. In the future, the

workforce of the Company will continue to increase due to the demand for development and expansion of production and business activities. In order to meet these requirements, TASCO always applies policies to employees, specifically:

- Always ensure stable employment, high pay and welfare for employees. - Always develop and communicate the corporate culture to all employees based on core

values of the company. - Apply International standards on occupational health and safety OHSAS 18001:2007. The

company controls risks of occupational health and safety for employees, perfects the integration of system ISO 9001-2008 on the quality for products - safety for employees, environment - cost savings.

- Always ensure that all employees are trained regularly, continuously and fully equipped with knowledge and skills to fulfill their assigned tasks. In 2016, Tasco Joint Stock Company officially established TASEDU One Member Company Limited with the main activity of training and developing employees, with the training program is based on the capacity dictionary of each block/ department, personal development plan of each employee and based on the assessment results of the training needs in each year.

In 2016, members of the Board of Management, members of the Board of Supervisors, Board of General Directors and managers... attended about 40 training sessions and seminars on corporate management, with the following outstanding programs:

• Risk management and Internal control standards COSO; • Development of effective integrated marketing communications strategies; • Sales and unsurpassed customer service; • Art of Human resource management; • Change management; • The Fourth Industrial Revolution; • The Seminar: "Current affairs of the economy in Vietnam and in the World and

investment opportunities of enterprises in 2016"…

For the environment and society: TASCO always strictly adheres to the provisions of the law on environmental protection. All employees always grasp thoroughly and are trained in labor safety and environmental

hygiene. For TASCO, contributions to the society are a part of its responsibility to contribute to the

sustainable development of the company as well as to the development of the society. TASCO always determines that the success is not only recognized by income but also by the level and responsibility of contribution to community development of the enterprise.

TASCO always expresses its responsibility to the community through the donation to the locality, people in difficult circumstances..., at the same time encourages all employees, the whole TASCO system to participate in non-profit activities and share with many people in difficult circumstances, such as:

• Supporting money to upgrade and renovate the road of Hai Trung Hamlet, Hai Hau, Nam Dinh;


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• Organizing the charity prograMs. in Nam Dinh - Hanoi; • Funding the "Link of Love" program; • Funding Nam Dinh Provincial Study Encouragement Fund; • Supporting people with meritorious services to the revolution in housing in Hanoi; • Giving the collection, support and direct transportation to support the money and

necessities for flood victiMs. in Quang Binh Province.

VI. FINANCIAL STATEMENTS:

1. Auditors’ opinion: In the opinion of the CPA Vietnam Auditing Co., Ltd, the Attached financial statements truly

and reasonably reflected, on the material respects, the financial situation of the Company as at 31/12/2016, as well as the income and the cash flows for the fiscal year ended on the same day, complies with the current Accounting Standards of Vietnam and Corporate Accounting System of Vietnam and the legal provisions relating to the preparation and presentation of financial statements. 2. The financial statements of TASCO Joint Stock Company have been audited:

Address of publication and supply of financial statements of the parent company and consolidated financial statements: http://taric.com.vn/

annual report - tasco jsc - year...

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