TRUSTED PARTNER BOLD PIONEER - Vincom Retail

vincom.com.vn

Annual Report

2021

TRUSTEDPARTNER

BOLDPIONEER

Tel: (+84) 24 3974 9999Website: vincom.com.vn

No.7 Bang Lang 1, Vinhomes Riverside Ecological Urban Area, Viet Hung Ward, Long Bien District, Hanoi, Vietnam.

VINCOM RETAIL JSC

Annual Report

2021

Table of Contents

Vincom Retail 2021 and Message from the Board of Directors

Vision, Mission and Core Values 08

2021 At a Glance 10

2021 Highlights 12

Message from the Board of Directors

18

Financial and Operational Highlights 2015 – 2021

20

Corporate Profile 24

Corporate Milestones 26

Businesses 28

Corporate Structure 32

Board of Directors 34

Management 36

Supervisory Board 38

Business Strategy 40

General Information 90

Statement of the Management 91

Independent Auditors’ Report 92

Consolidated Balance Sheet 93

Consolidated Income Statement 97

Consolidated Cash Flow Statement

99

Notes to the consolidated financial statements

101

Vincom Retail’s Vision for Sustainability

78

2021 Sustainability Report 78

Sustainable Development Strategy

84

Vincom Retail Governance Structure

62

Report of the Board of Directors 62

Report of the Supervisory Board 64

Governance Report 66

Internal Auditing Report 67

Risk Management 67

Share Price Information and Investor Relations

68

2021 Economy and 2022 Macroeconomic Outlook

50

Vincom Retail Operations and Financial Performance in 2021

54

Blueprint for 2022 58

About Vincom Retail

Corporate Governance

Sustainable Development

Consolidated Financial Statements

Management Report on 2021 Business Performance and 2022 Plan of Action

01 02 03 04 05 06

CHAPTER

Vincom Retail 2021 and Message from the Board of Directors

01

Vision, Mission and Core Values 08

2021 At a Glance 10

2021 Highlights 12

Message from the Board of Directors

18


20

06 07Vincom Retail - Annual Report 2021Chapter 01 - Vincom Retail 2021 and Message from the Board of Directors

Vision

Vincom Retail develops, operates, and manages a leading retail mall platform in many provinces and cities in Vietnam. The Company’s dominance is based on its scale, speed of development, international standards, and quality of service.

Mission

As a pioneer in the retail property market in Vietnam, Vincom Retail delivers retail, entertainment and dining experiences that help shape lifestyles for the people of Vietnam. Vincom Retail and its retail partners are bringing modern shopping, quality products and premium services to Vietnam, introducing consumers to the latest trends in the retail experience.

As a member of Vingroup, Vincom Retail inherits and promotes Vingroup’s vision, mission and core values.

Core values

Vincom Retail shares with Vingroup the six core values of CREDIBILITY, INTEGRITY, CREATIVITY, SPEED, QUALITY, and COMPASSION, exhibiting a culture of professionalism.

CREDIBILITYVincom Retail vigorously protects its Credibility as one would protect his honor, continuously strengthening its deployment readiness and execution competence; and spares no effort in delivering on its commitments.

INTEGRITYIntegrity lays the foundation for Vincom Retail, where we strictly respect and comply with the laws and ethical standards, putting the interests of our customers first.

CREATIVITYVincom Retail sees Creativity as a vital catalyst for growth, embracing the entrepreneurial spirit to build an enterprise of constant learning.

SPEEDVincom Retail values Speed and Efficiency as the principles of its Decision-making – “Fast To Decide, Fast To Invest, Fast To Deploy, Fast To Sell, Fast To Change, and Fast To Adapt”.

QUALITYVincom Retail’s commitment to high quality in its operations is expressed as “Best in People, Best in Products and Services, Best in Quality of Life, and delivering the Best to Society.”

COMPASSIONVincom Retail nurtures its relationships with Compassion, treasuring human capital as its most valuable asset and harmonizing all the stakeholders’ benefits on the basis of fairness, integrity and solidarity.

Vision, Mission and Core Values

Chapter 01 - Vincom Retail 2021 and Message from the Board of Directors08 09Vincom Retail - Annual Report 2021

2021 at A Glance

4.7 3.2 80 431.7Revenue from leasing activitiesVND VNDTRILLION TRILLION MILLION SQM

Profit before tax from leasing activities Gross retail floor area (GFA)Retail malls Cities and provinces

10 11Vincom Retail - Annual Report 2021Chapter 01 - Vincom Retail 2021 and Message from the Board of Directors

2021 Highlights

Vincom Retail solidified its position as the leading investor, developer, lessor and operator of retail malls in Vietnam

Successfully launched Grand World Phu Quoc retail tourism model at Phu Quoc United Center

Research and development of new generation retail malls to drive shopping trends

030201As of December 31, 2021, Vincom Retail owned 80 retail malls in 43 out of 63 cities and provinces. Its gross retail floor area reached about 1.7 million square meters.

Vincom Retail became the first operator in Vietnam to lease and operate a retail tourism model at Grand World Phu Quoc.

With more than 400 domestic and international tenants, Grand World Phu Quoc presents a harmonious mix of local and international brands, with diverse services, brand segments, and product categories to address a variety of needs of tourist groups and provide a perfect building block for Phu Quoc United Center to become one of the most attractive destinations in Southeast Asia.

Phu Quoc United Center’s inaugural campaign was in the Top 3 Social Media Campaigns in April 2021, attracting nearly 640,000 visitors in the first two months since being launched.

In 2021, with its pioneering position, Vincom Retail focused its research on next-generation Vincom Mega Malls to improve the retail customer experience and explore new development paths for the Vietnamese market. In addition to inheriting the advantages of “all-in-one” retail stores, the new generation Vincom Mega Malls are also expected to become Life-Design Malls – that establish modern, dynamic, and unique lifestyles.

With outstanding and pioneering products, they offer a high-quality retail mall platform that enables retailers to provide a unique in-store experience that meets the needs of today’s modern and smart customers.

Vincom Retail continued to be the top choice for nearly 1,000 domestic and international retail brands to expand their business in Vietnam and win local customers.


Sustainable development with solar energy

In 2021, to encourage green operations and sustainable development, Vincom Retail installed 50 solar panel facilities at our retail malls.

0604 05

Development of anchor chain tenants was a bright spot for retail in 2021In 2021, major brands continued to expand their presence at Vincom retail malls, despite the challenges caused by Covid-19. These brands include international brands as Uniqlo, H&M, Muji, Decathlon, Mango, Nike, Levi’s, Fila, Xtep, The Body Shop, Dookki and domestic brands as Pantio, Highlands Coffee, Golden Gate.

In addition, Vincom Retail also promoted on-site cooperation, exchanges, sponsorship, and advertising activities to support tenants, leveraging identified customers and optimizing marketing costs.

Supports to tenants to share their burden in the face of the pandemicVincom Retail continued to strengthen its role as a key strategic partner that stood ready to support its tenants in the challenging year of 2021.

Vincom Retail released funds of nearly VND 3,000 billion in 2020 and 2021, while offering flexible operational plans to respond to pandemic-related developments, to provide safe stores, and to maximize the business performance of tenants.

At full-capacity operation, the total clean energy produced is expected to reach 13.6 MWp, equivalent to the output of a small solar power plant, covering 10% of the energy consumption of Vincom malls under normal conditions.

2021 Highlights


Message from The Board of Directors

BOARD MEMBER AND CHIEF EXECUTIVE OFFICER

Ms. Tran Mai Hoa

Dear Valued Shareholders,

On behalf of the Board of Directors and Management of Vincom Retail Joint Stock Company, I send our warmest greetings and best wishes for your health, happiness, and success.

Ladies and Gentlemen,

Despite the fact that 2021 was the most challenging year since the outbreak of the Covid-19 pandemic, Vietnam’s economy recorded a positive growth rate of 2.58% and was in the Top 20 economies in terms of international trade.

For the retail industry, the total revenue in 2021 reached nearly VND 4,790 trillion, down 3.8% compared with 2020. However, since the fourth quarter of 2021, as a result of accelerated vaccinations and economic stimulus policies, Vietnam has begun adapting its economy to the new normal. Total retail sales in the fourth quarter of 2021 increased by 28% compared to the previous quarter. The retail industry is expected to further recover and grow in 2022 as it benefits from post-lockdown spending trends.

On the positive side, Covid-19 presented not only challenges but also opportunities for high-performing retailers who are able to predict trends and buyer personas in order to drive disruptive growth and dominate the market.

“

17Vincom Retail - Annual Report 2021Chapter 01 - Vincom Retail 2021 and Message from the Board of Directors16

Trusted Partner

In terms of scale, in 2021, Vincom Retail maintained its position as the number one retail property investor in the Vietnamese market, managing 80 retail malls in 43 provinces and cities nationwide, with gross retail floor area of approximately 1.7 million square meter.

In terms of business performance, Vincom Retail recorded consolidated net revenue of nearly VND 5.9 trillion and the annual after-tax profit of VND 1.3 trillion in 2021. These achievements were made possible thanks to close partnerships with tenants where Vincom Retail played the role of a strategic partner for retail brands and a pioneer in leading retail market growth.

Throughout 2020 and 2021, Vincom Retail demonstrated its long-term commitment and cooperation by standing by its tenants and quickly offering effective support, including reduced rent and service fees. In 2020 and 2021, the Company disbursed a support package worth up to VND 3.0 trillion for tenants affected by the Covid-19 pandemic.

In 2021, thanks to its reputation as the leading leasing partner, Vincom Retail was chosen by many large international tenants such as Uniqlo, Muji, H&M, and Decathlon as a partner to expand their chain of stores nationwide by continuously launching new stores in Hanoi and Ho Chi Minh City.

In terms of operation, Vincom Retail implemented a variety of different measures to optimize management costs and drive more efficient operations. In addition, Vincom Retail standardized and simplified its management and

operations in order to successfully adapt to the rapidly changing environment. The company placed pandemic prevention efforts and the safety of all operations staff, tenants, and shoppers as its top priorities.

Additionally, using a customer-centric approach, Vincom Retail consistently managed to upgrade the customer experience, turning Vincom malls into “bright spots” in provinces and cities where they are located. These efforts aim to improve service quality by implementing three measures: facility upgrades, service quality improvement, and the digitization of communication channels and search engines.

2021 was also a year that Vincom Retail left its footprint on the retail market by launching a new and unique product model in cooperation with local businesses and retailers, with the goal of building modern retail platforms in new destinations.

In April 2021, Vincom Retail successfully launched Grand World Phu Quoc, the first-ever retail tourism model in Vietnam aimed at turning Phu Quoc into one of the top destinations in Southeast Asia.

Bold Pioneer

Given the strong foundation laid down in 2021, Vincom Retail is expected to ride the wave of recovery in the retail industry and be a leader in exploring new market trends in 2022.

In terms of scale, Vincom Retail plans to launch three new projects with a retail gross floor area of nearly 95,000 square meters, bringing its total retail gross floor area to 1.8 million square meters. Also, Vincom Retail will further explore and upgrade retail tourism products at Grand World Phu Quoc and VinWonders to effectively leverage these potential projects.

Regarding product development, Vincom Retail will focus on research and development of next-generation products to stay on top of global trends in the retail market. In particular, it plans to launch a new generation of Vincom Mega Malls, which are expected to become Life-Design Malls that establish modern, dynamic and unique lifestyles.

With regard to expanding its tenant network, Vincom Retail will focus on expanding its tenants in two categories: international anchor tenants and Vietnamese tenants. For launched projects, Vincom Retail further upgraded its category planning and tenant portfolios to meet emerging needs and market trends.

In 2022, Vincom Retail will further promote the building of the exceptional customer experience to create retail malls with the best customer experience in Vietnam. In addition, its internal management system will be standardized, streamlined, and automated in order to optimize operational costs and efficiency.

Putting elite human resources at the heart of its development, Vincom Retail will provide basic training programs to improve human resources quality for key positions, while developing future leaders through self-learning and intensive training courses.

Ladies and Gentlemen,

Overcoming the challenging periods of the market in the past two years, Vincom Retail affirmed its role as a reliable partner that closely engaged with the nearly 1,000 tenants throughout its system.

In 2022, the retail industry will enter a new development period and Vincom Retail aims to maintain its position as the market leading retailer with a mission to build connections in the business community, stay on top of global trends, and explore new products and development paths for Vietnam’s retailers.

For shopping customers, Vincom Retail aims to win their hearts with our new positioning: A leading brand that offers a safe, unique, and inspiring experience in Vietnam.

On behalf of the Board of Vincom Retail, I express my sincere gratitude for your past support, and I look forward to a successful partnership as we continue to reach our lofty goals.

I wish you the best of health, happiness, and success.

Sincerely,

On behalf of The Board of Directors

Tran Mai HoaBoard Member and

Chief Executive Officer



Paracel Islands

Spratly Islands

Key Locations

The network created by Vincom Retail encompasses prime business locations throughout Vietnam. As of December 31, 2021, Vincom Retail is operating in 43 cities and provinces.

In 2021, retail malls in Hanoi and Ho Chi Minh City occupied nearly 60% of the total retail gross floor area and nearly 70% of Vincom Retail’s revenue from leasing of investment properties and rendering of related services.

5

3

3

11

Vincom Center

Vincom Mega Mall

Vincom Plaza

Total

Vincom Center

Vincom Mega Mall

Vincom Plaza

Vincom+

Total

2

1

7

3

13

HANOI

HO CHI MINH CITY

Revenue from leasing of investment properties and rendering of related services

202120202019201820172015 2016

4,701

2,427

4,455

5,506

7,017

6,008

3,805

GFA (thousand sqm) Number of malls

(billion VND)

1. As of December 31, 2021

Vincom Retail mall network (1)

202120202019201820172015 2016

1,026

883

1,173

1,448

1,599 1,654 1,654

22

3246

66

79 80 80

21Vincom Retail - Annual Report 2021Chapter 01 - Vincom Retail 2021 and Message from the Board of Directors20

About Vincom Retail

02CHAPTER

Corporate Profile 24

Corporate Milestones 26

Businesses 28

Corporate Structure 32

Board of Directors 34

Management 36

Supervisory Board 38

Business Strategy 40

22 23Vincom Retail - Annual Report 2021Chapter 02 - About Vincom Retail

Corporate Profile

Vincom Retail Joint Stock Company (“Vincom Retail” or “the Company”) was established on April 11, 2012 under Business Registration Certificate No. 0105850244 issued by the Hanoi Authority for Planning and Investment. The Certificate was amended several times, changed for the 21st time on October 28, 2021.

Vingroup began developing its retail network in 2004 under the “Vincom” brand. Since 2013, Vincom Retail became the subsidiary designated to develop and operate Vingroup’s network of retail malls, and was converted to a joint stock company on May 14, 2013. Since its inception, Vincom Retail has led Vietnam’s retail market, with 80 malls in 43 cities and provinces. The Company operates four distinct formats: Vincom Center, Vincom Mega Mall, Vincom Plaza and Vincom+.

On October 25, 2017, the Company was listed on the Ho Chi Minh City Stock Exchange (HOSE) under Decision No. 379-QDSGDHCM. On November 06, 2017, Vincom Retail’s shares were first traded under ticker symbol VRE.

Full company name

Abbreviated name

Headquarters

Telephone

Website vincom.com.vn

Vincom Retail JSC

Vincom Retail Joint Stock Company

No.7 Bang Lang 1, Vinhomes Riverside Ecological Urban Area, Viet Hung Ward, Long Bien District, Hanoi, Vietnam

(+84) 24 3974 9999

Vincom Retail is a leading developer, owner

and operator of retail properties in Vietnam

in terms of network and coverage and the first choice of visitors and shoppers nationwide.

24 25Chapter 02 - About Vincom Retail Vincom Retail - Annual Report 2021

Corporate Milestones

VincomRetail Limited Company was established

2012

2013

2014

2015

2016Vincom+ retail mall format was launched

Zara opened its first store in Vietnam at Vincom Center Dong Khoi

At year-end, Vincom Retail owned 31 retail malls with total retail gross floor area of one million square meters

Handed over the Vinhomes Nguyen Chi Thanh mixed-use project with 378 luxury apartments

Pre-sold 700 shophouses, condotels, and shop-offices in five provinces

Received capital contributions of USD 390 million from Vingroup

At year-end 2015, Vincom Retail owned 21 retail malls with a total retail gross floor area of 850,000 square meters. Ten were newly opened this year, including, most prominently, the Vincom Mega Mall Thao Dien

Received an additionalinvestment of USD 100 million from Warburg Pincus Investments III B.V.

Acquired Vincom Mega Mall Times City from Vingroup

Opened Vincom Plaza Ha Long – the first retail mall outside Hanoi and Ho Chi Minh City

At year-end 2014,Vincom Retail owned and managed six retail malls

Converted into a joint stock company

Acquired malls from Vingroup including Vincom Center Ba Trieu, Vincom Center Dong Khoi, Vincom Mega Mall Royal City and Vincom Plaza Long Bien

Received an investment of USD 200 million from Warburg Pincus III B.V. and Credit Suisse AG Singapore

2017

2019

2020

2021

2018

Vincom Mega Mall Ocean Park was launched on December 11, 2020 and covers a gross floor area of over 56,000 square meters. The four-story retail mall will deliver unique experience in shopping, dining and entertainment for Hanoi residents and those from surrounding areas

Honored among the Top 10 brands in Vietnam by Forbes Vietnam, with a brand value of USD 168.8 million, an increase of 13.2 million compared to 2019

Launched Grand World Phu Quoc retail tourism model at Phu Quoc United Center

Top 20 companies of 2021 with stocks in the Vietnam Sustainability Index (VNSI)

Opened 13 new malls, raising the total retail gross floor area to nearly 1.6 million square meters in 43 cities and provinces nationwide

Put Landmark 81 SkyView into operation – the Southeast Asia’s highest observatory tower

Vincom Center Landmark 81 Sky View was honored in both Best Retail Development – Asia Pacific and Best International Retail Development, a part of the International Property Awards 2019

Named one of the Top 10 Vietnam’s Most Valuable Brands by Forbes Vietnam, with a brand value of USD 155.6 million

Opened 20 new retail malls, a record number in the Company’s 14-year history, for a combined total of 66, served 38 cities and provinces with a total retail gross floor area of 1.5 million square meters

Attracted more than 1,000 domestic and international tenants representing established F&B, fashion, entertainment and cultural brands

Opened Vincom Center in Landmark 81, Vietnam’s tallest building, with outlets representing nearly 100 domestic and international brands

Honored in Top 15 Vietnam’s Most Valuable Brands by Forbes

Vincom Retail launched 15 new retail malls

At year-end, Vincom Retail’s 46 malls contained 1.2 million square meters of retail gross floor area in 24 cities and provinces of Vietnam

H&M, Pull&Bear, Massimo Dutti and Stradivarius opened their first retail stores in Vietnam at Vincom Center Dong Khoi

Zara and H&M opened stores in Hanoi at Vincom Center Ba Trieu and Vincom Mega Mall Royal City

Vincom Retail pre-sold more than 1,200 apartments, condotels, and shophouses in eight cities and provinces


Businesses Vincom Retail has four distinct formats:Vincom CenterVincom Mega MallVincom PlazaVincom +

With a nationwide presence, Vincom malls provide experiential retail destinations and are the first to offer the latest consumer trends for tenants and customers in Vietnam.

Vincom Retail stands as the leading developer, owner, and operator of retail malls with its extensive network of retail malls in Vietnam.


Symbol of the new consumer lifestyle

Vincom Mega Malls are large-scale lifestyle malls located in integrated, mixed-use developments in key cities. They are “fortress malls” and contain thousands of retail, entertainment, family-friendly facilities, food and beverage options, targeted at addressing the lifestyle needs of families across all income segments. There are now four Vincom Mega Malls nationwide, in which three in Hanoi and one in Ho Chi Minh City.

Vincom Mega Malls have been upgraded to provide a seamless experience with new generation products called Life-Design Mall properties which combines shopping space with culinary experiences, entertainment and community cohesion, bringing a source of inspiration for modern and dynamic lifestyle.

Vincom Retail develops and sells shophouses mostly in the vicinity of Vincom Plaza and Vincom+ malls, and condominium units and office towers at Vincom Center projects. Cash flow from the sale of inventory properties helps finance the development of its malls.

Symbol of high quality

Vincom Center malls are situated in high-density, high-traffic areas at the heart of major cities with a variety of aspirational domestic and international brands. The Company currently owns and operates seven Vincom Center retail malls across Vietnam – five in Hanoi and two in Ho Chi Minh City.

Modern shopping experiences to local communities

The Vincom+ network of community retail malls includes malls in medium-density non-central locations in Hanoi and Ho Chi Minh City and also in the central core of towns and provinces with population of more than 30,000 people. There are currently 15 Vincom+ retail malls in 11 cities and provinces throughout Vietnam.

Community destinations

Vincom Plaza malls are designed for families living in and around smaller cities and outside the central core of large cities like Hanoi and Ho Chi Minh City. Vincom Retail currently operates 54 Vincom Plaza malls in 40 cities and provinces across Vietnam.

Vincom Retail leases, manages and serves customers, plans and executes marketing programs to attract customers at retail tourism properties developed in Vietnam’s largest tourism destinations – such as Nha Trang and Phu Quoc.

02.05.

01. 04.

03. 06.

Vincom Mega Mall

Shophouse for Sale

Vincom Center Vincom+

Vincom Plaza

Retail tourism


Research &DevelopmentDepartment

SalesDepartment

MarketingDepartment

INSPECTIONDIVISION

BOARD OFDIRECTORS

MANAGEMENT

GENERALMEETING OF

SHAREHOLDERS

SALE ANDMARKETING DIVISION

MallManagement

Offices

OPERATIONALDIVISION

SECURITY, SAFETY ANDFIRE PREVENTION DIVISION

HumanResource

and TrainingDepartment

ITDepartment

AdministrationDepartment

ADMINISTRATIONDIVISION

LEGAL DIVISION

AccountingDepartment

Department ofOptimization

FINANCE - ACCOUNTINGDIVISION

SUPERVISORYBOARD

Corporate Structure

LIST OF SUBSIDIARIES AS OF DECEMBER 31, 2021

No. Subsidiary name Head office address Key Business Percentage of holding (%)

1 Vincom Retail Operation Company, Ltd

Symphony Office Building, Chu Huy Man Street, Vinhomes Riverside Ecological Urban Area, Phuc Loi Ward, Long Bien District, Hanoi, Vietnam

Sale of inventory properties

100.00%

2 Suoi Hoa Urban Development and Investment JSC

Km1+200, Tran Hung Dao Street, Suoi Hoa Ward, Bac Ninh City, Bac Ninh Province


97.27%

32 33Vincom Retail - Annual Report 2021Chapter 02 - About Vincom Retail

Board of Directors

Ms. Thai Thi Thanh Hai Ms. Tran Mai Hoa Mr. Nguyen The Anh

Chairperson of The Board Board Member and Chief Executive Officer

Board Member

Ms. Thai Thi Thanh Hai was elected to the Board in 2018. She was the Chief Executive Officer (“CEO”) of VinCommerce General Commercial Services JSC. Before joining Vincom Retail, she worked for Deloitte Vietnam from 1994 to 2014. She received her Bachelor’s degree in Economics from Hanoi University of Finance and Accounting.

Ms. Thai Thi Thanh Hai was elected Chairperson of the Board in June 2018.

Ms. Tran Mai Hoa was elected to the Board in 2017. She is also CEO of Vincom Retail. She joined Vincom Retail in 2014, serving through 2016 as Project Director of Vincom Mega Mall Times City and Vincom Mega Mall Royal City, and Deputy CEO of Vincom Retail. Prior to joining Vincom Retail, she was the Chief Financial Officer of Gami Commercial Joint Stock Company in 2013. From 2003 to 2013, she held various management positions at An Du Investment Corporation, the Vietnamese distributor of Mercedes-Benz vehicles, including Deputy CEO from 2009 to 2013, CFO from 2009 to 2011 and Chief Accountant from 2005 to 2009. She received a Bachelor’s degree in Accounting from the National Economics University and a degree in English from the Hanoi Foreign Language University.

Mr. Nguyen The Anh was elected a Board Member on June 23, 2021. He has concurrently been the Head of the Supervisory Board of Vingroup since 2007. Earlier, he worked as the Deputy Chief of Office and Assistant General Director of Joint Stock Commercial Bank for Foreign Trade of Vietnam from 2005 to 2007 and Assistant General Director from 2001 to 2005. Mr. Nguyen The Anh holds a Master’s degree in Political Economics from the National University of Vietnam.

Ms. Le Mai Lan Mr. Fong, Ming Huang Ernest Mr. Sanjay Vianayak

Board Member Independent Board Member Independent Board Member

Ms. Le Mai Lan was elected to the Board in 2017. She is currently Chairperson of VinSchool LLC, a subsidiary of Vingroup and Chairperson of VinUni University Council. Previously, she was CEO of Bank Training and Consultancy Joint Stock Company from 2005 to 2013. From 2001 to 2005, she was an Independent Financial Advisor at the International Finance Corporation of the World Bank and a lecturer at the Hanoi University of Science and Technology. She was previously Business Manager of ABN Amro Bank from 1997 to 2001. Ms. Le Mai Lan holds the degree of Master of Business Administration from Berlin TU University in Germany.

Mr. Fong, Ming Huang Ernest was elected to the Board on May 26, 2020. He has extensive experience in Finance and Real Estate. Before joining Vincom Retail, Mr. Fong served in many important positions at Credit Suisse Group AG such as Managing Director of Securities Research for Asia Pacific from 1998 to 2019, Head of Real Estate Research for Asia Pacific, and Head of Market Research in Taiwan. He was in charge of Singapore Real Estate for Credit Lyonnais Securities Asia (CLSA) from 1995 – 1998. Mr. Fong, Ming Huang Ernest is currently Asia Pacific CEO at Optimas Capital, based in Singapore.

Mr. Sanjay Vinayak was elected to the Board on January 05, 2021. He has deep knowledge and experience in Finance and Corporate Banking. Before joining Vincom Retail, he was Managing Director at Deutsche Bank, Executive Director at ABN Amro Bank, and Manager at Credit Lyonnais Commercial Bank. He is currently the Founder and CEO of Connect and Heal Global Pte Ltd., Singapore.


Management

Ms. Tran Mai Hoa Ms. Pham Thi Thu Hien

Board Member and Chief Executive Officer

Deputy Chief Executive Officer

Further details can be found in Vincom Retail’s Annual Report 2021, About Vincom Retail – Board of Directors.

Ms. Pham Thi Thu Hien was born in 1977. She holds a Bachelor’s degree in Banking and Finance from Banking Academy and a Master's degree in Business Administration for SME - under VCCI. Before joining Vincom Retail, Ms. Hien held many leadership positions such as Director of Sales and Marketing at An Du – an official distributor of Mercedes-Benz Vietnam, Project Manager at Savills Vietnam, CEO of Kaiserdom JSC Vietnam which focuses on retail real estate. She joined Vincom Retail in 2014. During her seven years working at the Company, Ms. Hien held the position of Business Director responsible for chain tenants, large and international tenants. She also holds an important role in bringing flagship international brands into Vincom retail malls and oversees major tenants. Ms. Pham Thi Thu Hien was appointed Deputy Chief Executive Officer of the Company from March 16, 2021.

Mr. Nguyen Duy Khanh Mr. Pham Hoang VietMs. Pham Thi Ngoc Ha

Deputy Chief Executive Officer Chief AccountantChief Financial Officer

Mr. Nguyen Duy Khanh was appointed as the Deputy Chief Executive Officer for Operations on September 07, 2021. Mr. Khanh worked at CBRE Group before joining Vincom Retail in 2016. While working at the Company, Mr. Khanh held many important leadership positions such as Project Director and Regional Director, and made significant contributions to research and implementation of solutions for more efficient operations, digital transformation, and sustainable development of Vincom shopping malls. Mr. Nguyen Duy Khanh graduated from Foreign Trade University and Hanoi Law University and holds a Master’s degree in International Business Law from Foreign Trade University.

Ms. Pham Thi Ngoc Ha was appointed as Chief Financial Officer of the Company since September 07, 2021. Before joining Vincom Retail, Ms. Pham Thi Ngoc Ha worked at Deloitte Vietnam Co., Ltd. from 2005 to 2017 as a Senior Audit Manager. From August 2018 to February 2021, she held many managerial positions at Vingroup’s subsidiaries including Head of Finance and Planning at VinTech, Chief Financial Officer at Vietnam VinSmart Technology Development Joint Stock Company, and Head of Optimization and Efficiency Department at the Finance Division of Vingroup. Ms. Ha holds a Bachelor’s degree in Accounting and Auditing from National Economics University and a Master’s degree of Business Administration from South Columbia University. Ms. Pham Thi Ngoc Ha holds the Certificate of Vietnamese Practicing Auditor (CPA Vietnam), the Certificate of Vietnam Tax Practitioner and the Certificate of Chief Accountant.

Mr. Pham Hoang Viet was appointed as Chief Accountant of the Company since September 07, 2021. Before joining Vincom Retail, Mr. Pham Hoang Viet held several management positions at auditing companies, including Head of Audit at Ernst & Young Vietnam Co., Ltd., Head of Audit at An Viet Auditing Co., Ltd. and Audit Director at SCS Global Auditing Co., Ltd. Mr. Viet graduated with a Bachelor’s degree in Finance and Banking from Hanoi University of Business and Technology. Mr. Pham Hoang Viet holds the Certificate of Vietnamese Practicing Auditor (CPA Vietnam), the Certificate of Vietnam Tax Practitioner and the Certificate of Chief Accountant.


Supervisory board

Mr. Chu Anh Dung Ms. Nguyen Thu Phuong Ms. Tran Thanh Tam

Head of The Supervisory Board Member Member

Mr. Chu Anh Dung was appointed Head of the Supervisory Board on October 05, 2021. He is concurrently Deputy Head of the Accounting Department in the Finance Division at Vingroup. Before joining Vincom Retail, Mr. Chu Anh Dung held different positions at Ernst & Young Vietnam Co., Ltd., including Senior Audit Manager from 2017 to 2020 and Audit Team Leader from 2015 to 2017. Mr. Chu Anh Dung holds a Bachelor’s degree in Banking and Finance from Foreign Trade University.

Ms. Nguyen Thu Phuong was appointed to the Supervisory Board in 2017. Ms. Phuong is currently the Acting Director of Products and Debts – Credit, Vinhomes Joint Stock Company and previously held the position of Senior Specialist in the Finance Division at Vingroup. Ms. Phuong was an Audit Assistant in charge of Nexia ACPA Auditing and Consulting Co., Ltd from 2009 to 2010. Previously, she held several positions at Ernst & Young Vietnam Ltd, including Auditor and Audit Team Leader from 2010 to 2013. She graduated from Financial Institute of Vietnam with a Bachelor’s degree in Finance.

Ms. Tran Thanh Tam was appointed to the Supervisory Board in 2017. She is the Chief of General Accountants in the Accounting Department at Vinhomes JSC. Prior to that, she was General Accountant at Ericsson Vietnam Limited from 2009 to 2010, Chief Accountant of FIT Financial Investment Company from 2007 to 2009, General Accountant at Float Glass Company Limited Vietnam from 2005 to 2007 and as an accountant at Shell Vietnam from 2001 to 2005. Ms. Tran Thanh Tam graduated from Financial Institute of Vietnam in 2001 with a Bachelor’s degree in Accounting.

39Vincom Retail - Annual Report 202138 Chapter 02 - About Vincom Retail

Business StrategyVincom Retail aims to maintain its market share and customer preference in the Vietnam retail property market by driving market trends and addressing changing consumer tastes nationwide. Leveraging its deep market knowledge and in-depth research to better understand consumer needs in Vietnam, Vincom Retail has built a modern and all-in-one retail model. Each mall is an attractive and popular destination where shoppers experience global trends in fashion, F&B and technology.

According to the General Statistics Office, GDP expanded 5.2% year-on-year in the fourth quarter of 2021 and GDP in 2021 grew by 2.6% over 2020. The Socio-Economic Recovery and Development Programme was approved with a total funding of c.VND 350 trillion for 2022 – 2023, in which fiscal policies are the main pillar, taking up 80% of total funding. International financial institutions such as HSBC and Standard Chartered expect Vietnam’s GDP growth in 2022 to reach 6.5 to 6.7%, thanks to its high vaccination coverage and economic recovery policies.

Commercial and retail activities are gradually recovering. Total retail sales in the fourth quarter of 2021 increased by 28% compared to the previous quarter while total retail sales for the entire 2021 reached nearly VND 4.8 trillion, down 3.8% compared to 2020, due to Covid-19 impacts.

Vietnam’s retail market is forecast to recover in 2022 thanks to the easing of travel restrictions and Vietnam’s political stability, large population, high proportion of younger people, and significant growth of the middle class.

Overview

2.6%

350 trillionVND

GDP growth in 2021

Funding for The Socio-Economic Recovery and Development Programme

According to CBRE’s report “Asia-Pacific Retail Market Outlook 2022”, Vietnam will remain the top destination for international retailers to expand their business.

The midterm development strategy of Vincom Retail is to further expand the network of retail malls focusing on two models: Vincom Mega Mall and Vincom Center. These are shopping destinations in prime locations such as centers of major cities and provinces, or within Vinhomes mega residential projects. This provides shoppers with comprehensive services and leverages the Group’s rich customer base, including Vinhomes residents as well as neighboring locales.

In 2022, Vincom Retail plans to launch three retail malls and increase a total GFA to nearly 1.8 million square meters across the network.

Business Strategy

01.


Product Strategy

While maintaining the quality and operational standards of the current 80 Vincom retail malls, Vincom Retail will focus on developing the large-scale Vincom Mega Mall (VMM) at mega polycentric cities such as Hanoi and Ho Chi Minh City, as well as other big cities in Vietnam. These will be strategic projects, representing many well-known domestic and international brands, including brands making their debut in Vietnam and serving as a place where Vincom Retail introduces new shopping trends and address the locales’ need for excellent services.

Vincom will also continue to enhance the value of its operating shopping centers by improving tenant mix and attracting more anchor tenants to affirm its leading position as a partner with international brands in Vietnam.

Vincom Retail will also upgrade and renovate its existing retail malls by restructuring retail tenant mix with the idea of remaining the trusted partner of world-class brands in Vietnam.

Vincom Retail is now the first retail property developer in Vietnam to adopt the retail-tainment model with a chain of commercial shops in the 24 by 7 Grand World Phu Quoc, at a mega “hospitality and entertainment destination Phu Quoc United Center” – a “sleepless” complex located at the northern end of Phu Quoc island. This destination will include shopping, entertainment, large-scale musical festivals, and conventions.

In the years to come, Vincom Retail will launch similar large projects in Nha Trang, Ha Long, Hai Phong, and most visited cities in Vietnam.

02.Vincom Retail will focus on developing the large-scale

Vincom Mega Mall at mega polycentric cities.


2

Tenant Collaboration

Vincom Retail’s relationship with tenants is central to its business plan for 2022. New tenants will be divided into two groups:

Vincom Retail also aims to bridge connections in the business community, share cooperation opportunities, and market new consumer products.

Vincom Retail is committed to supporting tenants in their business operations with professional management and dedicated staff, thus quickly addressing tenants’ specific needs and increasing the business efficiency.

03.International tenants

Vietnamese brands

1


Attracting customers

Cooperation within the Vingroup Ecosystem

Given its customer-centric strategy, Vincom Retail malls need to be more than shopping centers. They connect communities and become cultural hubs where people meet to enjoy entertainment and dining as well as shopping.

Vincom Retail constantly improves its business model by upgrading its stores, introducing brands that better reflect the preferences and income of target customers, adding amenities, upgrading infrastructure, applying technology for increased convenience and deploying marketing activities that meet consumer tastes.

To promote its services and enhance revenues, Vincom Retail will continue to receive support from other subsidiaries within the Group. Vincom Retail will

Vincom Retail focuses on building an information management system and a customer database to enhance the customer experience while launching the Vincom website and applications to optimize customer touch point effectiveness.

As part of its role in building connections and leading the market, Vincom Retail works with tenants to develop policies and business solutions that will drive market recovery in 2022 through impactful promotions. In addition, with chain tenants and large anchor tenants, Vincom Retail creates program to optimize trade marketing activities.

04.

05. also work with One Mount Group in collaboration with tenants to facilitate promotional campaigns and effective targeted marketing tactics.


Management Report on 2021 Business Performance and 2022 Plan of Action

03CHAPTER

2021 Economy and 2022 Macroeconomic Outlook

50


54

Blueprint for 2022 58

48 49Chapter 03 - Management Report on 2021 Business Performance and 2022 Plan of Action Vincom Retail - Annual Report 2021

2021 IN A SNAPSHOT

Macroeconomy Covid-19’s ongoing and potential new variants make the trajectory of the pandemic unpredictable, causing global economic effects despite attempts to increase vaccination rates and reach herd immunity in most countries. The economic rebound is uneven across countries. Global supply chains are disrupted as demand for goods has skyrocketed after the pandemic, while production and logistics fail to meet the spike in demand, resulting in inflation concerns in many countries. However, with government efforts, the global economy has shown positive signs of recovery. According to International Monetary Fund, global gross domestic product (GDP) growth in 2021 is expected to reach 5.9%, representing a strong rebound compared to 2020.

Vietnam continued to demonstrate strong resistance to the pandemic thanks to the Government’s timely actions aimed

at preventing the virus spread, while promoting local economic development and ensuring social security. With rapid deployment of a nationwide vaccination campaign, Vietnam is within the top six countries with the highest Covid-19 vaccination rates in the world. This will be an important driver for economic recovery and development in 2022. According to the General Statistics Office (GSO), Vietnam recorded GDP growth of 2.58% in 2021. The consumer price index (CPI) was kept stable. On average, in 2021 CPI grew by 1.8% compared to 2020, the lowest average annual growth since 2016.

Among sectors that contributed to the economic growth in 2021, the service sector contributed 22.2%, up 1.2% year-on-year. Total retail sales dropped by 3.8% year-on-year in 2021, if excluding the 6.2% decrease in price.

2.58%

1.2%

GDP growth in 2021

The service sector contributed

Retail Property Following prolonged social distancing during which retail stores were closed for an extended period, the retail market showed positive signs of recovery in the last three months of 2021. The fourth quarter of 2021 witnessed growth of 28.1% in total retail sales of consumer goods and services, suggesting that consumer demand has recovered positively.

In 2021, Vietnam’s total retail floor area increased by 16,000 sqm in Ho Chi Minh

City, despite many projects delaying launching events due to Covid-19 situation. However, according to CBRE Vietnam, shopping mall rents and occupancy rates in the two major cities remained stable.

Despite the negative impacts of the Covid-19 pandemic, local and foreign-invested businesses continued to look for prime rental properties to expand their business and stay ahead of post-lockdown spending trends.

28.1%Growth in the fourth quarter of 2021

suggesting that consumer demand has recovered positively

The Economy in 2021 and the Macroeconomic Outlook for 2022


Macroeconomic Forecast

Retail Property Given a solid foundation, Vietnam’s economy has shown a remarkable resilience during periods of crisis and, most recently, the Covid-19 pandemic. According to leading economic experts, Vietnam’s economic growth prospects will be brighter in 2022.

With resolutions on fiscal and monetary policies combined with a support package worth c.VND 350 trillion for socio-economic recovery and development, the National Assembly is targeting GDP growth of 6.0 to 6.5%, GDP per capita to USD 3,900 with a Consumer Price Index (CPI) increase of less than 4% to help control inflation.

The Economist Intelligence Unit (EIU) predicts retail sales will grow by 10.3% annually on average between now and 2024 when most of the population has had at least basic vaccination doses, and even additional and booster injections. Consumers will quickly adapt to the “new normal”, with retail sales and travel rebounding.

The potential growth for the retail real estate market in 2022 is expected to be positive as consumer confidence returns thanks to the normalization of the pandemic and the effectiveness of economic development and recovery policies.

In 2022, according to CBRE forecasts, property rents and occupancy rates in the retail markets of Hanoi and Ho Chi Minh City will recover positively. As Covid-19 vaccination coverage continues to expand and people co-exist with the pandemic in the new normal, consumer confidence will significantly increase.

In terms of supply, large-scale projects will be dominant in the near future. In 2022, the new supply in Hanoi will be mainly in non-CBD areas with about 99,000 sqm of new retail floor area. In particular, Vincom Mega Mall Smart City (68,000 sqm GFA), in the Nam Tu Liem district, will be the largest shopping mall launch this year and is expected to become a new entertainment

For the period 2021 – 2024, according to the EIU forecasts, consumption expenditure per capita growth in Vietnam is expected to reach 10%, far exceeding that of other countries in Southeast Asia. This will be another recovery driver for the retail sector that has suffered over the past two years.

center in western Hanoi. The supply in Ho Chi Minh City is also expected to expand its retail floor area by 137,000 sqm in 2022.

Physical stores will remain active and continue to play an important role in business operations despite the pandemic’s acceleration of the transition to e-commerce. As a result, flagship stores in prime locations will play a key role in delivering engaging customer experience. Retailers will continue to use physical stores, retail technology and e-commerce platforms as important elements of their omni-channel strategy.

2022 – A pivotal year for recovery and growth

2022 OUTLOOK

Expecting retail floor area in Hanoi and Ho Chi Minh City to expand by

Vincom Mega Mall Smart City

WILL BE THE LARGEST SHOPPING MALL LAUNCH THIS YEAR

236,000sqm

68,000sqm GFA

6.0-6.5%

The National Assembly is targeting GDP growth of



Total Revenue rose to VND 5.9 trillion in 2021. Of this amount, Revenue from Leasing of Investment properties and Rendering of Related services was VND 4.7 trillion. Revenue from the Sale of Inventory Properties was VND 1.0 trillion and Other Revenue was VND 0.2 trillion. Revenue from Leasing of Investment properties and Rendering of Related services decreased by VND 1.3 trillion, or 22% below 2020, due to the pandemic impact. Net Operating Income from Leasing of Investment properties and Rendering of Related services decreased by 26% to VND 3.2 trillion in 2021.

Revenue from the Sale of Inventory Properties in 2021 was attributable mainly to the delivery of shophouse projects in Bac Lieu, Uong Bi, Thai Hoa, Cam Pha. Profit After Tax for 2021 reached VND 1.3 trillion, a decrease of 45% compared to 2020.

Despite significant prolonged impacts and complicated market developments brought on by the pandemic, tenants continued to place their trust in Vincom Retail in 2021.

Many anchor tenants such as Muji, Decathlon, and H&M further expanded their business in Vietnam, including store expansions in Vincom shopping centers. Numerous other famous brands, such as Uniqlo, Pizza 4P’s, and An Nam Gourmet, also planned to expand their stores with Vincom Retail. Many first-time tenants with Vincom Retail, such as Sen Tai Thu, and Go Kart, signed new leases and are planning to launch stores in April 2022 in VMM Smart City.

Guided by a vision for sustained cooperation and development with tenants, Vincom Retail provided quick, effective, and timely solutions to help share the burden with tenants through a support budget of over VND 2.1 trillion.

Excluding the tenant support package, Vincom Retail’s profit after tax may exceed its plan thanks to effective cost-cutting measures implemented at scale during the pandemic.

for the Year Ending December 31, 2021 Discussion and Analysis of the Income Statement

Indicators 2021 (VND billion)

2020 (VND billion)

% change

Revenue from Leasing of Investment properties and Rendering of Related services 4,701 6,008 -21.76%

Revenue from Sale of the Inventory properties 1,004 2,149 -53.28%

Other Revenue 186 172 8.48%

Total Revenues 5,891 8,329 -29.27%

Net Operating Income from Leasing of Investment properties and Rendering of Related services (*) 3,161 4,280 -26.15%

Profit Before Tax 1,692 2,993 -43.45%

Profit After Tax 1,315 2,382 -44.80%

Source: VAS audited consolidated financial statements for 2020 and 2021 (*) Data estimated by the Company

Total Revenue in 2021

5.9 TRILLION

TRILLION

VND

VND

Revenue from Leasing of Investment properties and Rendering of Related services

4.7

Tenants continued to place their trust in Vincom Retail in 2021.


Discussion and Analysis of the Balance Sheet

Indicators 2021 (VND billion)

2020 (VND billion)

% change

Current Assets 6,827 7,012 -2.63%

Non-Current Assets 31,047 32,804 -5.36%

Total Assets 37,873 39,816 -4.88%

Total Liabilities 7,223 10,481 -31.09%

Where: Total Loan and Debts (short and long-term) 3,158 5,726 -44.85%

Statutory obligations 490 322 52.29%

Owners’ Equity 30,651 29,336 4.48%

Source: VAS audited consolidated financial statements for 2020 and 2021

Current Assets slightly decreased by VND 0.2 trillion, from VND 7.0 trillion in 2020 to VND 6.8 trillion at year-end 2021.

Non-Current Assets decreased by VND 1.8 trillion from VND 32.8 trillion in 2020 to VND 31.0 trillion at the end of 2021, mainly due to the re-categorization of a number of deposits for project investment from non-current to current assets based on the remaining duration of contracts.

Vincom Retail’s Total Loans and Debts decreased by VND 2.6 trillion from VND 5.7 trillion at the end of 2020 to VND 3.2 trillion

for the Year Ending December 31, 2021For the fiscal year ending December 31, 2021, the Current Ratio of Vincom Retail rose from 1.98 to 2.36 times because Current Liabilities decreased more than Current Assets. Current Liabilities decreased mainly due to the reduction of payables related to property transfer.

Total Liabilities declined sharply mainly due the repayment for bonds, leading to a sharp decrease in the ratio of Total Liabilities to Total Assets from 26.32% to 19.07% while the ratio of Owners’ Equity to Total Assets increased from 73.68% to 80.93%.

at the end of 2021, mainly due to its payment of corporate bonds with a total par value of VND 2.6 trillion in 2021.

Owners’ Equity at the end of 2021 increased by VND 1.3 trillion from VND 29.3 trillion at the end of 2020 to VND 30.7 trillion at the end of 2021, due to an increase in Retained Earnings despite the pandemic challenge.

Statutory Obligations increased from VND 0.3 trillion at the end of 2020 to VND 0.5 trillion at the end of 2021. During 2021, the Company accrued a total of VND 1.2 trillion of tax payables and paid a total of VND 1.0 trillion to the State Budget.

Source: Audited consolidated financial statements for 2020 and 2021

Key Financial Indicators

Indicators Unit 2021 2020

Asset structure:Non-Current Assets/Total Assets % 81.98 82.39

Current Assets/Total Assets % 18.02 17.61

Resource structure:Total Liabilities/Total Assets % 19.07 26.32

Owners’ Equity/Total Assets % 80.93 73.68

Liquidity ratios:Quick ratio Times 1.72 1.81

Current ratio Times 2.36 1.98

Profitability ratios:

Return on Assets % 3.47 5.98

Profit After Tax/Net Revenue % 22.32 28.60

Return on Equity % 4.29 8.12

Total Liabilities/Total Assets

Owners’ Equity/Total Assets

19.07%

80.93%


Blueprint for 2022

During 2022, Vincom Retail intends to solidify its leading position in the modern retail property market in terms of scale and market share, while delivering excellent customer service and customer experience.

Following the successful launch of Vincom Mega Mall Ocean Park, Vincom will focus on developing and expanding the large-scale VMM model with modern design in Vinhomes mega mixed-use developments. Vincom Mega Mall Smart City is scheduled to open in April 2022.

Vincom also plans to launch two new Vincom Plaza (VCP) projects in 2022.

Vincom Retail malls remain safe and exciting destinations for shopping, dining and entertainment.

These malls are in prime locations with nearby blocks of shophouses. VCP is one of the Vincom mall formats, an appealing destination in a city center that will drive changes in consumer shopping trends.

With its customer-centric practices, the Company will take the lead in delivering best-in-class service culture which inspires local business communities.

Vincom Retail malls remain safe and exciting destinations for shopping, dining and entertainment.


CorporateGovernance

04CHAPTER


Report of the Board of Directors

Report of the Supervisory Board

Governance Report

Internal Audit

Risk Management

Share Price Information and Investor Relations

62

62

64

66

67

67

68

60 61Chapter 04 - Corporate Governance Vincom Retail - Annual Report 2021

During 2021, the BOD followed the Company’s Charter and Corporate Governance, internal management rules, and the law, as follows:

Supervised the implementation and prepared resources for the Company’s ongoing projects

Successfully organized the Annual General Meeting of Shareholders (“the GMS”) on June 23, 2021

Implemented the financial reports of 2021, annual report, the quarterly and semi-annual financial reports

Supervised the implementation of decisions made by the GMS and BOD, and supervised the business activities of Management

Supervised information disclosure to ensure transparency and timeliness appropriate to a large publicly-listed company, and

Supervised the work of the Management to improve business performance and to accomplish planned goals.

The Board of Directors has not established subcommittees directly under the Board.


Report of the Board of Directors

Further details can be found in Vingroup’s Annual Report 2021, Corporate Governance – Vingroup Governance Structure.

Since May 26, 2020, the Board of Directors (“the Board” or “the BOD”) of Vincom Retail consists of six members. It is chaired by one Chairperson and includes two Independent Directors.

With the exception of two members of the Board of Directors based overseas, all remaining members and Management are fully engaged in corporate governance training.

Introduction of the Board of Directors

Participation of Board Members in Corporate Governance Programs

Resolutions issued by the Board of Directors during 2021, included the following:

Board Meetings and the Announcement of Major Decisions ∙

∙

∙

∙

∙

∙

Content Number of Resolutions

Establishment of additional branches 01

Organization of the Annual General Meeting of Shareholders 04

Approval of related parties’ transactions 01

Establishment of the Internal Audit Committee and internal audit regulations 02

Regulations on information disclosure 01

Collection of shareholders’ written opinions and Proposal to the Board of Directors 01

Delegation and assignment to the Chairperson of the Board of Directors 01


Report of theSupervisory Board

The Supervisory Board evaluates the Company’s activities as sustainable and in compliance with existing law. The implementation of decisions of the Annual General Meeting and the Board is closely

Thanks to thorough implementation of corporate governance regulations by Management and staff, the Board of Directors was able to monitor and execute the Company’s business strategies in a timely manner, and make decisions related to the operations of the Company. During

The Supervisory Board approves the consolidated financial statements of 2021 as audited by KPMG Vietnam Limited. The financial statements give a true and fair view of the financial position of the Company as of December 31,

01.

02.

03.

Assessment of compliance with the law and implementation of decisions made by the Annual General Meeting of Shareholders and the Board of Directors

Assessment of compliance with the Company’s internal management guidelines

Assessment of the financial situation of the Company

the past year, the Supervisory Board has increased its inspection and control of compliance, the quality of work and the level of independence in its monitoring activities, especially as they relate to material transactions and transactions with related parties.

monitored to ensure full compliance. The Supervisory Board believes the Annual General Meeting, the Board and related departments have completed all of their assigned duties.

2021 and the results of operations and cash flows for the financial year from January 01, 2021 to December 31, 2021 in accordance with the provisions of the Company’s accounting system.

In 2021, the Supervisory Board strengthened inspection and supervisory activities, and coordinated with the Board of Directors and Management to monitor the implementation and assessment of AGM and BOD resolutions. Within the scope of the functions and tasks as specified in the Law on Enterprises, Charter and internal regulations, the Supervisory Board also performed the internal audits and supervisory activities of the Company, ensuring that business operations were in compliance with applicable laws and the Company’s Governance Regulations, to minimize the risks arising from the Company’s operations.


Governance Report2021 Governance Report

Compensation for Members of the Board of Directors and Supervisory Board

Changes in the membership of the Board of Directors, Supervisory Board, and Management

During 2021, the Company remained in full compliance with regulations on corporate governance for public companies and information disclosure on the stock market.

After achieving positive outcomes from the 2020 restructuring, Vincom Retail continued to streamline its administrative processes and optimize resource allocation in 2021 to maximize contribution and enhance the supervisory functions of the Board, as well as ensure a system-wide implementation of the principles and fortify the relationships between the Company and related parties.

Vincom Retail’s Investor Relations function strives to provide transparent and timely communication with shareholders and investors. Vincom Retail is one of the few enterprises to issue financial reports in line with Vietnamese Accounting Standards (VAS) and International Financial Reporting Standards (IFRS). The financial reports of the Company and its affiliates are audited by KPMG Vietnam Ltd.

Remuneration for members of the Board was VND 2.6 billion, equivalent to 0.2% of 2021 profit after tax.

Remuneration for the Supervisory Board was 0.3 billion VND, equivalent to 0.03% of 2021 profit after tax.

Change in the membership of the Board of Directors:

Change in the membership of the Supervisory Board:

Change in Management:

∙

∙

On January 05, 2021, Mr. Brett Harold Krause stepped down from the Board and Mr. Sanjay Vinayak was appointed as an Independent Board Member.

On June 23, 2021, Ms. Nguyen Thi Diu stepped down from the Board and Mr. Nguyen The Anh was appointed as a Board Member.

On October 05, 2021, Ms. Do Thi Quynh Trang stepped down from the Board and Mr. Chu Anh Dung was appointed as the Head of the Supervisory Board.

∙

∙

∙

∙

∙

∙

∙

∙

∙

On March 16, 2021, Ms. Tran Thu Hien stepped down from Management and Ms. Pham Thi Thu Hien was appointed as the Deputy CEO for Sales and Marketing.

On March 26, 2021, Ms. Pham Ngoc Thoa stepped down from Management and Ms. Pham Thi Ngoc Ha was appointed as the Chief Accountant.

On September 07, 2021, Mr. Nguyen Duy Khanh was appointed as the Deputy CEO for Operations.

On September 07, 2021, Ms. Pham Thi Ngoc Ha stepped down from Management and Mr. Pham Hoang Viet was appointed as the Chief Accountant.

On September 07, 2021, Ms. Pham Thi Ngoc Ha was appointed as the Chief Financial Officer.

On October 28, 2021, Mr. Nguyen Anh Dung stepped down from his role as Deputy Chief Executive Officer.

Internal Audit

Risk Management

The Vincom Retail Board of Directors works closely and frequently with various functional departments to manage risks. Vingroup’s risk management policies are adopted by Vincom Retail. The Company adopts Vingroup’s framework to create its own risk management mechanism, optimally balancing between the incident costs and the risk management costs.

Further details can be found in Vingroup’s Annual Report 2021, Corporate Governance – Risk Management.

Risk assessment and internal audit planning for 2021.

Coordination with the Legal Affairs and Finance and Accounting Divisions to inspect and evaluate auditees in compliance with legal requirements such as tax, insurance and other obligations.

Coordination with the Inspection Division to inspect and evaluate auditees in compliance with internal processes, regulations and policies. Assessment of the effectiveness and efficiency of internal control and corporate governance regarding timely detection, prevention and management of operational risks.

Review of financial information of the Company and its subsidiaries on a quarterly, biannual and annual basis.

Proposal of countermeasures for issues reported in internal audits in order to continuously improve the Company’s internal control and corporate governance.

Monitoring and facilitation of the implementation of recommendations of the Internal Audit Division to the Company and its subsidiaries.

Coordination and discussion with the Company’s external audit to better understand emerging problems or unusual risks reported in regular financial statement audits, together with proposed timely solutions.

In 2021, the Company’s Internal Audit Division reviewed and evaluated the business performance and compliance with its internal regulations in the following activities:

∙

∙

∙

∙

∙

∙

∙


July 2021 – September 2021The pandemic peaked in many major cities, including Hanoi and Ho Chi Minh City, leading to nationwide social distancing orders. Most of the shopping malls were closed as required for Covid-19 prevention and control.

Share Price Information and Investor Relations Vincom Retail Share Price During 2021

Ticker

Shares outstanding (as of December 31, 2021)

Market capitalization (as of December 31, 2021)

Non-restricted shares

Restricted shares None

VRE

2,272,318,410

68,396,784,141,000

2,272,318,410

(*): Calculated using weighted average closing prices for 250 trading days in 2021. Source: Ho Chi Minh Stock Exchange and Bloomberg.

SHARES

SHARES

VND

2021 Share Price Performance

April 27, 20211

2

3

4

October 2021

December 2021

Despite some recovery in Quarter I and Quarter II of 2021, the Vietnamese stock market was volatile due to the impact of the fourth wave of Covid-19, which led to prolonged social distancing orders across the country in Quarter III. However, thanks to the government’s concerted efforts to roll out vaccination campaigns nationwide, by the end of Quarter III, the situation was under control and social – economic activities were gradually resumed, including re-opening of shopping malls in the country. By the end of 2021, Vietnam is within the top six countries with the highest vaccine coverage rate in the world, contributing to positive GDP growth in 2021 and facilitating economic recovery in 2022.

Trading Volume Share Price VN Index

Feb 21Jan 21 Mar 21 Apr 21 May 21 Jul 21Jun 21 Aug 21 Sep 21 Oct 21 Nov 21 Dec 21

Volume (m

illion shares)Shar

e Pr

ice (V

ND)

12.0

14.0

10.0

8.0

6.0

4.0

2.0

0.0

45,000

40,000

35,000

30,000

25,000

20,000

15,000

10,000

5,000

0

16.0

1 2

3 4

Trading Price

Share price Date Price (VND/share)

Closing 31.12.2021 30,100

Low 23.08.2021 26,500

High 25.01.2021 37,800

Volume-weighted average price * 31,112

Trading volume

Date Trading volume (‘000 shares)

Closing 31.12.2021 6,177

Low 23.08.2021 5,284

High 25.01.2021 6,560

Average daily trading volume 3,437

The start of the fourth wave of the Covid-19 outbreak.

Resolution 128/NQ-CP on “safe and flexible adaptation and effective control over the Covid-19 pandemic” was issued for implementation nationwide, allowing shopping malls to reopen in most provinces and cities.

Vaccination coverage in Vietnam reached 78% of the population, exceeding the Government target of 70% by the end of Quarter I, 2022.

As of December 31, 2021, VRE’s share price reached

30,100 VND/ SHARE


Shareholder structure (As of December 31, 2021) (*)

No. Shareholder Number of shares held (shares)

Ownership percentage (%)

Number of shareholders

Structure of shareholders

Institutional Individual

1 State Ownership 0 0 0 0 0

2 Founding/FDI shareholders 0 0 0 0 0

- Domestic 0 0 0 0 0

- Foreign 0 0 0 0 0

3Significant shareholder (holding 5% of shares or more)

1,370,934,393 58.87 2 2 0

- Domestic 1,370,934,393 58.87 2 2 0

- Foreign 0 0 0 0 0

4 Company’s Union 0 0 0 0 0

- Domestic 0 0 0 0 0

- Foreign 0 0 0 0 0

5 Preference shares (if any) 0 0 0 0 0

6 Treasury shares 56,500,000 2.43 1 1 0

7 Other shareholders 901,384,017 38.70 34,055 310 33,745

- Domestic 197,030,887 8.44 33,230 100 33,130

- Foreign 704,353,130 30.24 825 210 615

TOTAL 2,328,818,410 2,328,818,410 100 34,058 313

- Domestic 1,624,465,280 69.74 33,233 103 33,130

- Foreign 704,353,130 30.26 825 210 615

(*) According to the list of shareholders of the Company as of December 31, 2021

(*) According to the list of shareholders of the Company as of December 31, 2021

Insider holdings

Significant shareholder holdings

(As of December 31, 2021) (*)

(As of December 31, 2021) (*)

No. Name Position Number of shares held Ownership percentage (%)

BOARD OF DIRECTORS

1 Ms. Thai Thi Thanh Hai Chairperson of the Board 0 0

2 Ms. Tran Mai Hoa Board Member 0 0

3 Ms. Le Mai Lan Board Member 0 0

4 Mr. Nguyen The Anh Board Member 0 0

5 Mr. Sanjay Vinayak Independent Board Member 0 0

6 Mr. Fong, Ming Huang Ernest Independent Board Member 0 0

MANAGEMENT

1 Ms. Tran Mai Hoa CEO 0 0

2 Mr. Nguyen Duy Khanh Deputy CEO 0 0

3 Ms. Pham Thi Thu Hien Deputy CEO 61 0.000002

4 Ms. Pham Thi Ngoc Ha Chief Financial Officer 0 0

5 Mr. Pham Hoang Viet Chief Accountant 0 0

SUPERVISORY BOARD

1 Mr. Chu Anh Dung Chairperson 0 0

2 Ms. Nguyen Thu Phuong Member 61 0.000002

3 Ms. Tran Thanh Tam Member 0 0

No. Shareholder Number of shares held

(shares)Ownership percentage

(%)

1 Vingroup Joint Stock Company 427,715,101 18.37

2 SADO Trading Commercial JSC 943,219,292 40.50


Transactions by insiders

Transactions by related parties of insiders

Transactions of Treasury share

Transactions of significant shareholders

None

(Members of the Board of Directors, Supervisory Board, Management)

None

None

No. Shareholder

Number of shares held at the start of 2021

Number of shares held at the end of 2021 Reasons for

increase/decreaseTransaction time

Number of shares

Ratio (%)

Number of shares

Ratio (%)

1Hanoi Southern City Development and Trading LLC

192,188,351 8.25 0 0.00Merger with SADO

Trading Commercial JSC

February 22, 2021

2SADO Trading Commercial JSC

192,188,351 8.25 943,219,292 40.50

Transfer of shares from Sai Dong Urban

Development and Investment JSC

April 19, 2021

3

Sai Dong Urban Development and Investment JSC *Due to business split-up

751,030,941 32.25 0 0.00Transfer of shares to SADO Trading Commercial JSC

April 19, 2021

Changes in Shareholders’ Equity

TimeAdditional capital

(VND)Post-transaction

charter capital (VND)Method

2013 0 2,944,200,000,000 Initial capital in the form of a joint stock company

July 2013 2,829,600,000,000 5,773,800,000,000 Private placement of common shares and preference shares

December 2013 3,530,000,000,000 9,303,800,000,000 Private placement of common shares and preference shares

April 2014 2,706,780,000,000 12,010,580,000,000 Private placement of common shares and preference shares

June 2015 9,098,000,000 12,019,678,000,000 Private placement of common shares

July 2015 2,152,567,470,000 14,172,245,470,000 Private placement of preference shares

March 2016 1,544,917,800,000 15,717,163,270,000 Private placement of common shares

May 2016 1,254,223,147,829 16,971,386,417,829 Issuance to existing shareholders

October 2016 117,851,002,171 17,089,237,420,000 Issuance to existing shareholders

December 2016 4,002,487,530,000 21,091,724,950,000 Issuance to existing shareholders

September 2017 419,200,000,000 21,510,924,950,000 Issuance of preference shares to convert convertible loans

September 2017 (2,500,137,620,000) 19,010,787,330,000 Redemption of preference shares and cancellation. Conversion of preference shares into common shares

December 2018 4,277,396,770,000 23,288,184,100,000 Issuance of shares from owners’ equity to existing shareholders


Vincom Retail maintains an active investor relations program to respond to inquiries, distribute information and manage communications with shareholders, investors, analysts and other interested parties via our official website www.vincom.com.vn. The Company is committed to fair treatment to all shareholders, whether domestic or foreign, institutional or individual. Through its website, the Company provides timely and accurate information on its business to shareholders and members of the public. The information is presented in English as well as Vietnamese. Investor presentations, news, and financial reports are updated regularly and may be downloaded from Investor Relations section on our website.

Vincom Retail organizes regular meetings with the participation of the Company’s senior management to keep investors and shareholders updated on the Company’s business strategies, as well as financial and operational results. Vincom Retail’s Investor Relations Department also maintains the ongoing interaction with domestic and foreign shareholders, investors and analysts through the AGM, quarterly earnings presentations, investor conferences, one-on-one meetings, and project site visits.

In 2021, due to travel restriction resulting from Covid-19 pandemic, the Investors Relations Department continued to host video conference and webinar to update shareholders with the Company’s performance on a timely manner. In 2021, Vincom Retail participated in 13 seminars and held meetings with our shareholders, in addition to webinars and virtual conferences with other investors.

Vincom Retail’s Investor Relations Department plans an even greater number of events for investors. Our goal is to respond promptly to all investor and analyst inquiries. Investor Relations can be reached via email or by mail at:

Investors Relations Department Vincom Retail JSC No.7 Bang Lang 1, Vinhomes Riverside Ecological Urban Area, Viet Hung Ward, Long Bien District, Hanoi Email: [email protected]

Shareholders and Investor Relations Activities During 2021

Chương 4 - Quản trị doanh nghiệp74

2021 Investor Relations Calendar

Financial calendar

Quarter I

Webinar updating business results in Quarter IV of 2020

JP Morgan Vietnam – Asia's Newest Tiger's Roar to get Louder

Credit Suisse – The 24th Asian Investment Conference

Quarter II

Webinar updating business results in Quarter I of 2021

VCSC – Vietnam Access Day Conference 2021

2021 Annual General Meeting of Shareholders

Goldman Sachs & HSC – Vietnam Corporate Day 2021

MBKE – Invest ASEAN 2021

UBS – OneASEAN Webinar 2021

Morgan Stanley – Virtual Flagship ASEAN Conference

Quarter III

Webinar updating business results in Quarter II of 2021

HOSE-Daiwa – Vietnam Corporate Day 2021

DC – Virtual Jefferies Asia Forum

EFG – Online Investor Conference

BofA – Global Real Estate Conference

HSBC – 2021 HSBC Global Emerging Markets Forum

JPM – Asia Rising Dragons 1x1 Forum

Quarter IV

Webinar updating business results in Quarter III of 2021

HSC – Vietnam Bouncing Back From Covid

Financial Year Ending December 31, 2021

June 23, 2021 2021 Annual General Meeting of Shareholders

April 28, 2021 Release of Quarter I, 2021 Financial Statements

July 27, 2021 Release of Quarter II, 2021 Financial Statements

October 28, 2021 Release of Quarter III, 2021 Financial Statements

January 28, 2022 Release of Quarter IV, 2021 Financial Statements

Financial Year Ending December 31, 2022

April 2022 Proposed release of Quarter I, 2022 Financial Statements

July 2022 Proposed release of Quarter II, 2022 Financial Statements

October 2022 Proposed release of Quarter III, 2022 Financial Statements

January 2023 Proposed release of Quarter IV, 2022 Financial Statements

* Except for the AGM, which is conducted via hybrid teleconference, all above conferences are in webinar format


05CHAPTER

Vincom Retail’s Vision for Sustainability

78

2021 Sustainability Report 78


84

Sustainable Development

76 77Vincom Retail - Annual Report 2021Chapter 05 - Sustainable Development

Vincom Retail’s Vision for Sustainability Further details can be found in Vingroup’s 2021 Annual Report, Vingroup’s Vision for Sustainability.

2021 Sustainability Report Energy Savings and Environmental Protection

During 2021, Vincom Retail implemented solutions for each retail mall format to improve environmental management and protection by complying with environmental protection standards and applying solutions to reduce waste such as saving energy, towards using clean energy sources, sorting and treating waste.

Vincom Retail commits to comply with current legal regulations related to environmental issues and guidance from authorities, focusing on three main things: Collecting and sorting waste at source; Monitoring wastewater quality; and Make periodic reports.

Waste from Vincom retail malls is sorted on-site into household waste and hazadous waste. Waste is sent to designated collection points and divided into different categories for qualified contractors to collect, remove from the site, and process in accordance with regulations on waste collection and sorting procedures.

Regarding wastewater treatment, all Vincom Retail malls have permits to discharge wastewater into water sources. Monitoring and making reports related to environmental protection activities are also periodically carried out in accordance with the current laws.

Vincom Retail has complied with 5K measures on disease prevention and control according to the regulations of the Ministry of Health as well as the guidance of local authorities to ensure the safety and health of customers and partners, maintaining a safe and stable business environment at each shopping center. At the peak of the pandemic, all Vincom shopping centers were disinfected; contact surfaces in public areas are cleaned every 2 hours; people entering the malls are measured the body temperature; and hand sanitizers are distributed around the mall.

The Company also regularly updates environmental regulations and policies in accordance with current legal standards to include them in the Company's legal compliance control system.

In addition to complying with environmental standards and regulations, Vincom Retail also actively researches and applies new technologies to save energy and reduce waste in the retail malls system.

Vincom Retail has complied with pandemic prevention and control measures according to regulations of the Ministry of Health as well as the guidance of authorities, maintaining a safe and stable business environment at each shopping mall. In 2021, despite many difficulties and challenges in operation, Vincom Retail still adhered to the control of the quality of water resources, including domestic water and wastewater, as shown in periodically environmental monitoring reports.

Installed solar panels at

Expected total energy production

~50 shopping malls

13.6 MWp

Vincom Retail malls continued its conservation program named “Say no to plastic waste” to manage hygiene and to protect the environment.

Vincom Retail maintains and continuously deploys communication activities to improve the environmental management system.

Vincom Retail malls continued its conservation program named “Say no to plastic waste” to manage hygiene and to protect the environment.

Vincom Retail researches the use of renewable energy sources, aiming to save costs and protect the environment. In 2021, Vincom Retail completed the installation of solar panels at nearly 50 shopping malls. With full-capacity operations, the total energy production is expected to reach 13.6 MWp, equivalent to the output of a small solar power plant, covering 10% of the energy consumption of Vincom shopping malls.

Simultaneously, Vincom Retail applies cooling water treatment technology for Chiller system: replacing the existing chemical wastewater treatment system with E-Water cooling water treatment technology at all Vincom retail malls across the country.

Vincom Retail has standardized its operational procedures on video, using facility management software to manage maintenance schedules and regulations on equipment use based on the needs of each retail mall. This standardization has saved energy to protect the environment. For example, inverters were installed in some air-conditioning systems, cooling towers and water pumps to address peak and off-peak demands or weather conditions in order to optimize equipment performance.

Vincom Retail also adopted hi-tech solutions to help control the operation of air-conditioning systems (including the chiller and the cooling tower) via Building Management Systems (BMSs) that are integrated with a Central Control Room. Collected data and performance assessments allow for timely adjustments that create a robust energy-saving system. In 2021, Vincom Retail cooperated with Barghest Building Performance of Singapore to test new energy-saving solutions and implemented trial installations at Vincom Center Tran Duy Hung.

79Vincom Retail - Annual Report 202178 Chapter 05 - Sustainable Development

Sustainability of Product Development

10

33

160

500

400

08

Outstanding Fine Arts and Photography events

Art-education events

Well-known local and international artists

Artworks

Visitors

thousand

Major exhibitions

Top

Bringing together over

Exhibiting more than

Attracting nearly

Since its establishment, the Vincom Center for Contemporary Art (VCCA) has organized multiple exhibitions that are listed by the Ministry of Culture, Sports, and Tourism among the top 10 Outstanding Fine Arts and Photography events.

In 2021, VCCA hosted eight major exhibitions and 33 art-education events, among other activities, bringing together over 160 well-known local and international artists and more than 500 artworks, attracting nearly 400,000 visitors.

In particular, the photography exhibition “At the Crossroads: Perspectives from Europe” by VCCA in collaboration with the French Cultural Centre (L’Espace) in Hanoi in May 2021, introduced artworks by artists from eight European countries, selected directly from Cultural Centers and Embassies to promote EU – Vietnam artistic exchanges and cooperation.

In addition, to help Vietnamese art expand further on the global stage, VCCA successfully organized the “Phu Quoc United Center Art Residency” program in November 2021, with the goal of creating an annual event to promote cultural and

artistic exchanges, build the value of creativity, fashion, and new lifestyles at Phu Quoc United Center, attract domestic and international art-loving tourists, and eventually add value to Vietnam’s overall tourism sector.

VCCA has become an increasingly attractive destination for young art lovers and has received much attention and affection from audiences and artists alike for in-person as well as virtual exhibitions and events.

On top of these activities, the Kind Heart Foundation and charities initiated by Vingroup, Vincom Retail and staff contributed and delivered many charitable activities across Vietnam.

Further details about corporate social responsibility can be found in the section on Corporate Social Responsibility in the Chapter on Sustainability in the Vingroup Annual Report 2021.

80 81Chapter 05 - Sustainable Development Vincom Retail - Annual Report 2021

Sustainability of Human Resources

Employment policies

In order to attract talented employees and to reward long-term commitment, Vincom Retail has created a comprehensive compensation policy that covers all employees, skills, and organizational levels. This policy tracks the contributions of each individual employee.

In addition, Vincom Retail has planned and regularly conducted online and offline training programs in order to enhance knowledge, improve technical skills, and instill service mindset for the Company's officers and employees as well as tenants’ staff. Vincom Retail also focuses on building the next generation of leaders, especially talented young leaders.

The company continuously reviews and updates its policies on human resource development, to ensure that all employees, regardless of gender, age, and qualifications, have equal opportunities for personal development.

Vincom Retail complies fully with all employment laws and regulations to ensure that jobs are protected, income is improved, and employee morale is safeguarded.

Further details can be found in Vingroup’s Annual Report 2021, Sustainability Report – Ongoing Development of Human Capital.

The average monthly income per employee during 2021

University and higher 464 (22.98%)

College and vocational training 379 (18.77%)

Unskilled worker 1.176 (58.25%)

Male 1,295 (64.14%)

Female 724 (35.86%)

Employee structure

Employee distribution by gender

Delivering transparency In order to deliver transparency in business and management activities while avoiding any disruptions to the operations of the Company, Vincom Retail developed The Transparency Policy. Targeting all employees at Vingroup and its subsidiaries, such as Vincom Retail (including employees on probation period and trainees) who are tasked to perform activities governed by the Policy, as well as Suppliers, and Related Persons as regulated therein. The policy provides measures on transparency, prevention of money laundering, prevention of bribery and corruption, internal related parties controls, and notes on sanctions laws of other countries to be aware/complied with in order to avoid any impacts on the Company’s operations.

Details of the Transparency Policy are presented in Vingroup 2021 Annual Report, Sustainable Development Chapter – Delivering Transparency Section.

11.5VND million

Employees

Employees

2.019

2.019


Stakeholders Value added by Vincom Retail

Shareholders and Investors

• Maximize the business and investment performance;• Transparent and fair corporate governance to protect shareholder interests;• Facilitate meetings between investors and the Company’s management to better understand Company

strategy through frequent meetings/webinars, official website, mailbox [email protected], and Investor Relations quarterly earnings presentations.

Customers

• Commitment to service quality and customer experience enhancement;• Regular organization of large-scale events to attract more footfalls;• 24/7 hotline to provide information and assistance to customers;• Ensure confidentiality of customer-related information• Evaluate customer satisfaction index periodically

Local community

• Environmental and community impact assessment studies prior to implementation of project developments;• Frequent dialogues with local authorities to improve the local environment;• Mobilization of local work force by creating new jobs, raising level of social well-being and local economy

where the Company operates.

Regulators

• Participation in conferences and seminars with regulators;• Participation in trade associations including the World Economic Forum (“WEF”) and Foreign

Investment Association;• Contribution of comments on the drafts of policies and legal documents.

Employees• Further details can be found in Chapter V: Sustainable Development – Sustainability Report• Workers are fully trained to obtain occupational safety certificates

Business partners and suppliers

• Relationship maintenance with suppliers and business partners based on fairness, transparency and mutual benefit;

• Supplier selection based on criteria including law compliance as well as commitment to environmental protection and sustainability.

To achieve these objectives, the Company is taking the actions outlined below:

ii. Social• Strengthen policies on human rights, policies for employees, partners, customers,

and local communities on human rights, equality, and anti-discrimination, commitment to not using child labor (including juvenile labor), forced labor, ensure equality and non-discrimination in the company;

• Establish robust environmental management systems to monitor implementation and evaluate performance;

• Finalize policies/commitments on safety and worker protection;• Periodically evaluate the performance for employees by criteria based on job

description, record the achievements and give a plan to improve (if any), create conditions for labor to maximize their capacity;

• Maintain periodic assessment of employee satisfaction by criteria of working environment, welfare regime, remuneration regime, facilities

i. Environmental • Improve policies on environmental protection to add quantitative objectives and

regular periodic assessments with adjustments as needed;• Apply clean technology solutions to reduce environmental impacts.• Establish robust environmental management systems to monitor implementation

and evaluate performance; • Promote research and development of environmental solutions.

Sustainable development orientations


Engaging stakeholders Vincom Retail aims to balance the interests of its stakeholders, in order to develop long-term sustainable partnerships based on mutual trust, transparency, and corporate ethical standards via sustainable development policies. To facilitate innovations in governance, product development, and service quality for economic growth, social responsibilities, and environmental protection, Vincom Retail remains attentive and responsive to stakeholders’ feedback on its activities.

The Company’s sustainability strategy requires Vincom Retail to strike a balance among the interests of stakeholders, following the four principles:

1. Economic Optimization for Sustainable Growth• Ensure economical productivity and maximize a sustainable growth• Lead and solidify the leading position in the retail property market• Make sustainable contributions to the economy• Strengthen corporate governance and management capability• Accompany and support partners, especially domestic partners

2. Sustainable Human Resources Development• Protect employee rights and equality• Develop a strong culture and solidarity• Focus on education and sustainable development of the human resources• Foster team spirit by organizing union and community activities

3. Responsibilities to Society• Raise level of social well-being in areas where the Company operates• Demonstrate a sense of social responsibility towards business partners, customers,

colleagues, and the community• Become a destination for culture, arts, and entertainment

4. Environmental Protection • Promote energy efficiency and the shift towards green energy sources• Focus on research and implementation of solutions to minimize negative impacts

on the environment

iii. Management• Improve managerial capability to ensure transparency, fairness, the rights and

interests of shareholders and related parties; • Establish robust internal control systems and risk management frameworks

accompanied by monitoring and evaluation mechanisms;


CHAPTER

General Information 90

Statement of the Management 91

Independent Auditors’ Report 92

Consolidated Balance Sheet 93

Consolidated Income Statement 97

Consolidated Cash Flow Statement

99

Notes to the Consolidated Financial Statements

101

Consolidated Financial Statements

06

86 87Chapter 06 - Consolidated Financial Statements Vincom Retail - Annual Report 2021

Vincom Retail Joint Stock Company and its subsidiaries

ConsolidatedFinancial Statements

for the year ended 31 December 2021

89Vincom Retail - Annual Report 202188 Chapter 06 - Consolidated Financial Statements

Corporate Information Statement of the Board of ManagementEnterprise Registration Certificate No.

Registered Office

Auditor

The Company’s Enterprise Registration Certificate has been amended several times, the most recent of which is dated 28 October 2021. The Company’s Enterprise Registration Certificate was issued by the Department of Planning and Investment of Ha Noi City.

No. 7, Bang Lang 1 Street Ecological Residence of Vinhomes RiversideViet Hung Ward, Long Bien District, Hanoi City, Vietnam

KPMG LimitedVietnam

11 April 20120105850244

Board of Directors

Ms. Thai Thi Thanh Hai Chairwoman

Ms. Tran Mai Hoa Member

Ms. Le Mai Lan Member

Mr. Sanjay Vinayak Member

Mr. Fong Ming Huang Ernest Member

Mr. Nguyen The Anh Member (from 23 June 2021)

Ms. Nguyen Thi Diu Member (until 23 June 2021)

Mr. Brett Harold Krause Member (until 5 January 2021)

Board of Management

Ms. Tran Mai Hoa General Director

Ms. Pham Thi Thu Hien Deputy General Director (from 16 March 2021)

Mr. Nguyen Duy Khanh Deputy General Director (from 7 September 2021)

Ms. Pham Thi Ngoc Ha Chief Financial Officer (from 7 September 2021)

Ms. Tran Thu Hien Deputy General Director (until 16 March 2021)

Mr. Nguyen Anh Dung Deputy General Director (until 28 October 2021)

Board of Supervision

Mr. Chu Anh Dung Head of Board of Supervision (from 5 October 2021)

Ms. Do Thi Quynh Trang Head of Board of Supervision (until 5 October 2021)

Ms. Nguyen Thu Phuong Member

Ms. Tran Thanh Tam Member

The Board of Management of Vincom Retail Joint Stock Company (“the Company”) presents this statement and the accompanying consolidated financial statements of the Company and its subsidiaries for the year ended 31 December 2021.

The Board of Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System for Enterprises and the relevant statutory requirements applicable to financial reporting. In the opinion of the Board of Management:

The Board of Management has, on the date of this statement, authorized the accompanying consolidated financial statements for issue.

the consolidated financial statements give a true and fair view of the consolidated financial position of the Company and its subsidiaries as at 31 December 2021, and of their consolidated results of operations and their consolidated cash flows for the year then ended in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System for Enterprises and the relevant statutory requirements applicable to financial reporting; and

at the date of this statement, there are no reasons to believe that the Company and its subsidiaries will not be able to pay its debts as and when they fall due.

(a)

(b)

On behalf of the Board of Management

Pham Thi Ngoc HaChief Financial Officer

Hanoi, 24 March 2022


Independent Auditor’s Report

To the Shareholders Vincom Retail Joint Stock Company

We have audited the accompanying consolidated financial statements of Vincom Retail Joint Stock Company (“the Company”) and its subsidiaries, which comprise the consolidated balance sheet as at 31 December 2021, the consolidated statements of income and cash flows for the year then ended and the explanatory notes thereto which were authorised for issue by the Company’s Board of Management on 24 March 2022.

Management’s Responsibility

The Company’s Board of Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System for Enterprises and the relevant statutory requirements applicable to financial reporting, and for such internal control as the Board of Management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with Vietnamese Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.

KPMG LimitedVietnamAudit ReportNo. 21-01-00203-22-2

Wang Toon KimPracticing Auditor RegistrationCertificate No. 0557-2018-007-1 Deputy General Director

Hanoi, 24 March 2022

Pham Thi Thuy LinhPracticing Auditor RegistrationCertificate No. 3065-2019-007-1

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Company’s Board of Management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Auditor’s Opinion

In our opinion, the consolidated financial statements give a true and fair view, in all material respects, of the consolidated financial position of Vincom Retail Joint Stock Company and its subsidiaries as at 31 December 2021 and of their consolidated results of operations and their consolidated cash flows for the year then ended in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System for Enterprises and the relevant statutory requirements applicable to financial reporting.

Code Note 31/12/2021 VND million

1/1/2021VND million

ASSETS

Current assets(100 = 110 + 120 + 130 + 140 + 150)

100 6,826,580 7,012,397

Cash and cash equivalents 110 5 3,297,060 3,050,907

Cash 111 1,788,884 1,030,907

Cash equivalents 112 1,508,176 2,020,000

Short-term financial investments 120 190,424 1,894,314

Held-to-maturity investments 123 6 190,424 1,894,314

Accounts receivable – short-term 130 1,487,714 1,446,089

Accounts receivable from customers – short-term 131 7 1,166,709 817,997

Prepayments to suppliers – short-term 132 8 42,620 97,136

Loans receivable 135 9 295,000 -

Other short-term receivables 136 10(a) 142,716 545,422

Allowance for doubtful debts 137 11 (159,331) (14,466)

Inventories 140 12 582,918 519,889

Inventories 141 582,918 519,889

Other current assets 150 1,268,464 101,198

Short-term prepaid expenses 151 18(a) 41,719 69,513

Deductible value added tax 152 22,965 31,150

Taxes and other receivables from State Treasury 153 380 535

Other current assets 155 13 1,203,400 -

Consolidated balance sheet

The accompanying notes are an integral part of these consolidated financial statements

Form B 01 – DN/HN (Issued under Circular No. 202/2014/TT-BTC dated 22 December 2014 of the Ministry of Finance)

as of 31 December 2021



1/1/2021VND million

Long-term assets(200 = 210 + 220 + 230 + 240 + 260)

200 31,046,908 32,804,035

Accounts receivable – long-term 210 6,110 8,308

Other long-term receivables 216 10(b) 6,110 8,308

Fixed assets 220 438,775 450,233

Tangible fixed assets 221 14 426,476 430,206

Cost 222 619,021 595,633

Accumulated depreciation 223 (192,545) (165,427)

Intangible assets 227 15 12,299 20,027

Cost 228 54,443 54,391

Accumulated amortisation 229 (42,144) (34,364)

Investment property 230 16 26,268,764 27,732,173

Cost 231 33,609,120 33,710,220

Accumulated depreciation 232 (7,340,356) (5,978,047)

Long-term work in progress 240 1,255,909 959,231

Construction in progress 242 17 1,255,909 959,231

Other long-term assets 260 3,077,350 3,654,090

Long-term prepaid expenses 261 18(b) 395,287 514,162

Deferred tax assets 262 19 16,032 16,032

Other long-term assets 268 13 2,404,420 2,789,702

Goodwill 269 20 261,611 334,194

TOTAL ASSETS (270 = 100 + 200) 270 37,873,488 39,816,432


1/1/2021VND million

RESOURCES

LIABILITIES (300 = 310 + 330) 300 7,222,659 10,480,616

Current liabilities 310 2,890,056 3,537,868

Accounts payable to suppliers – short-term 311 21 526,183 788,362

Advances from customers – short-term 312 22 278,179 429,835

Taxes and other payables to State Treasury 313 23 489,648 321,533

Payables to employees 314 - 204

Accrued expenses 315 24 628,864 1,009,332

Unearned revenue – short-term 318 25(a) 91,371 164,209

Other payables – short-term 319 26(a) 838,988 786,519

Short-term bonds and finance lease liabilities 320 27(a) 19,887 19,887

Provisions – short-term 321 28 14,040 15,091

Bonus and welfare fund 322 2,896 2,896

Long-term liabilities 330 4,332,603 6,942,748

Unearned revenue – long-term 336 25(b) 100,106 86,181

Other payables – long-term 337 26(b) 1,018,370 1,072,229

Long-term bonds and finance lease liabilities 338 27(b) 3,137,924 5,706,162

Deferred tax liabilities 341 19 76,203 78,176

The accompanying notes are an integral part of these consolidated financial statementsThe accompanying notes are an integral part of these consolidated financial statements

as of 31 December 2021 (continued)

Consolidated balance sheet

Form B 01 – DN/HN (Issued under Circular No. 202/2014/TT-BTC

dated 22 December 2014 of the Ministry of Finance)



1/1/2021VND million

EQUITY (400 = 410) 400 30,650,829 29,335,816

Owners’ equity 410 29 30,650,829 29,335,816

Share capital 411 30 23,288,184 23,288,184

Ordinary shares with voting rights 411a 23,288,184 23,288,184

Share premium 412 46,983 46,983

Treasury shares 415 (1,954,258) (1,954,258)

Other equity funds 420 (53,420) (53,420)

Undistributed profits after tax 421 9,288,513 7,974,003

Undistributed profit after tax brought forward 421a 7,974,003 5,592,148

Net profit after tax for the current year 421b 1,314,510 2,381,855

Non-controlling interest 429 34,827 34,324

TOTAL RESOURCES (440 = 300 + 400) 440 37,873,488 39,816,432

Code Note 2021 VND million

2020VND million

Revenue from sales of goods and provision of services 01 32 5,891,141 8,328,918

Revenue deductions 02 32 - -

Net revenue (10 = 01 - 02) 10 32 5,891,141 8,328,918

Cost of sales 11 33 3,499,036 4,507,631

Gross profit (20 = 10 - 11) 20 2,392,105 3,821,287

Financial incomeFinancial expenses

In which: Interest expenseSelling expensesGeneral and administration expenses

21 22 23 25 26

34 35 36 37

387,018 486,280 486,176 201,764 433,167

275,859 467,092 463,586 330,040 398,568

Net operating profit{30 = 20 + (21 - 22) - (25 + 26)}

30 1,657,912 2,901,446

Other income 31 38 84,095 123,527

Other expenses 32 39 49,730 32,253

Results of other activities(40 = 31 - 32)

40 34,365 91,274

Accounting profit before tax (50 = 30 + 40)

50 1,692,277 2,992,720

Current corporate income tax expense 51 41 379,237 619,241

Deferred corporate income tax benefit 52 41 (1,973) (8,830)

Net profit after tax (60 = 50 - 51 - 52)

60 1,315,013 2,382,309

24 March 2022

The accompanying notes are an integral part of these consolidated financial statements The accompanying notes are an integral part of these consolidated financial statements



Consolidated balance sheet Consolidated statement of income

Pham Hoang VietChief Accountant

Prepared by Approved by




as of 31 December 2021 (continued)


for the year ended 31 December 2021 (Indirect method)

Consolidated statement of cash flows


2020VND million

Net profit after tax (60 = 50 - 51 - 52)

60 1,315,013 2,382,309

Attributable to:

Equity holders of the CompanyNon-controlling interest

61 62

1,314,510 503

2,381,855 454

VND VND

Earnings per share

Basic earnings per share 70 42 578 1,048

24 March 2022


2020VND million

CASH FLOWS FROM OPERATING ACTIVITIES

Accounting profit before tax 01 1,692,277 2,992,720

Adjustments for

Depreciation and amortisation 02 1,492,420 1,482,557

Allowances and provisions 03 143,814 (6,502)

Profits from investing activities 05 (348,545) (262,413)

Interest expense and bonds issuance costs 06 486,176 463,586

Operating profit before changes in working capital 08 3,466,142 4,669,948

Change in receivables and other assets 09 (380,981) (250,952)

Change in inventories 10 (52,343) 471,505

Change in payables and other liabilities 11 (366,521) 43,194

Change in prepaid expenses 12 142,473 67,739

2,808,770 5,001,434

Interest paid 14 (519,699) (386,355)

Corporate income tax paid 15 (583,752) (592,703)

Net cash flows from operating activities 20 1,705,319 4,022,376

CASH FLOWS FROM INVESTING ACTIVITIES

Payments for additions to fixed assets and other long-term assets

21 (1,567,282) (4,377,225)

Collections on investment deposits 21 909,820 -

Proceeds from disposals of fixed assets 22 5,243 112

Payments for granting loans and placement of term deposits

23 (2,258,396) (2,875,936)

Receipts from collecting loans and proceeds from sale of debt instruments

24 3,671,000 1,750,000

Receipts of interest 27 401,827 243,664

Net cash flows from investing activities 30 1,162,212 (5,259,385)


for the year ended 31 December 2021 (continued)

Consolidated statement of income






The accompanying notes are an integral part of these consolidated financial statements The accompanying notes are an integral part of these consolidated financial statements


1. Reporting entity

24 March 2022


2020VND million

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from borrowings 33 - 2,920,483

Payments to settle loan principals 34 (2,600,000) -

Payments to settle finance lease liabilities 35 (21,378) (20,911)

Net cash flows from financing activities 40 (2,621,378) 2,899,572

Net cash flows during the year(50 = 20 + 30 + 40)

50 246,153 1,662,563

Cash and cash equivalents at the beginning of the year 60 3,050,907 1,388,344

Cash and cash equivalents at the end of the year (70 = 50 + 60)

70 5 3,297,060 3,050,907

These notes form an integral part of and should be read in conjunction with the accompanying consolidated financial statements.

Ownership structure Vincom Retail Joint Stock Company (“the Company”) is incorporated as a joint stock company in Vietnam. The consolidated financial statements of the Company for the year ended 31 December 2021 comprise the Company and its subsidiaries.

Principal activitiesThe current principal activities of the Company and its subsidiaries are to invest in and develop shopping centers for lease and inventory properties for sale.

Normal operating cycle The Company and its subsidiaries’ normal course of business cycle of inventory properties for sale business starts at the time of application for investment certificate, commencement of site clearance, construction, and ends at the time of completion, thus, the normal course of real estate development activities is from 12 months to 36 months. The Company and its subsidiaries’ normal course of business cycle of other business activities is 12 months.

Important event during the yearCovid-19 pandemicThe Covid-19 pandemic is adversely impacting the whole economy and most businesses and industries. This situation may cause uncertainties and has an impact on the environment in which the Company operates. The Company’s management has continuously monitored ongoing developments and assessed the financial impact in respects of the valuation of assets, provisions and contingent liabilities, and has used estimates and judgement in respects of various issues as the situation has evolved, using the best information obtained up to the date of these consolidated financial statements.

(a)

(b)

(c)

(d)


Notes to the consolidated financial statementsfor the year ended 31 December 2021 (Indirect method - continued)

Consolidated statement of cash flows


The accompanying notes are an integral part of these consolidated financial statements







The following significant accounting policies have been adopted by the Company and its subsidiaries in the preparation of these consolidated financial statements.

2. Basis of preparation

3. Summary of significant accounting policies

Basis of consolidation

Subsidiaries

Subsidiaries are entities controlled by the Company. The financial statements of the subsidiaries are consolidated in the consolidated financial statements from the date that control commences until the date that control ceases.

Non-controlling interests

Non-controlling interests (“NCI”) are measured at the proportionate share of the acquiree’s identifiable net assets at date of acquisition.

Changes in the Company’s interest in a subsidiary that do not result in a loss of control are accounted for as transactions with owners. The difference between the change in the Company’s share of net assets of the subsidiary and any consideration paid or received is recorded directly in undistributed profits after tax under equity.

Transactions eliminated on consolidation

Intra-group transactions, balances from the Company and its subsidiaries and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

(a)

(i)

(ii)

(iii)

Company structureAs at 31 December 2021, the Company had 2 directly owned subsidiaries (1 January 2021: 4 directly owned subsidiaries). Details of subsidiaries are as follows:

(*) In accordance with Decision No. 01/2021/QD-CSH-VCR and the merger contract, Ha Thanh Real Estate Development and Investment Company Limited was merged into North Vincom Retail Limited Liability Company. After the merger, on 2 July 2021, North Vincom Retail Limited Liability Company changed its name to Vincom Retail Operation Company Limited.

(**) In accordance with Decision No. 02/2021/QD-CSH-VCR and the merger contract, South Vincom Retail Limited Liability Company was merged into Vincom Retail Operation Company Limited.

All subsidiaries are incorporated in Vietnam.

As at 31 December 2021, the Company and its subsidiaries had 2,009 employees (1 January 2021: 2,137 employees).

(e)

Name Principal activities Address Percentage ofeconomic interests and

voting rights as at

31/12/2021 1/1/2021

Directly owned subsidiaries

Vincom Retail Operation Company Limited (formerly known as North Vincom Retail Limited Liability Company) (*)

Leasing malls, offices and providing related services, and trading real estate property and entertainment services.

Symphony Office Building, Chu Huy Man Street, Ecological Residence of Vinhomes Riverside, Phuc Loi Ward, Long Bien District, Hanoi City, Vietnam.

100.00% 100.00%

Suoi Hoa Urban Development and Investment Joint Stock Company


Km1 + 200, Tran Hung Dao Street, Suoi Hoa Ward, Bac Ninh City, Bac Ninh Province, Vietnam.

97.27% 97.27%

South Vincom Retail Limited Liability Company (**)


No. 72, Le Thanh Ton Street and No. 45A, Ly Tu Trong Street, Ben Nghe Ward, District 1, Ho Chi Minh City, Vietnam.

- 100.00%

Ha Thanh Real Estate Development and Investment Company Limited (*)


No. 7, Bang Lang 1 Street, Ecological Residence of Vinhomes Riverside, Viet Hung Ward, Long Bien District, Hanoi City, Vietnam

- 100.00%

Statement of complianceThe consolidated financial statements have been prepared in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System for Enterprises and the relevant statutory requirements applicable to financial reporting.

Basis of measurementThe consolidated financial statements, except for the consolidated statement of cash flows, are prepared on the accrual basis using the historical cost concept. The consolidated statement of cash flows is prepared using the indirect method.

Annual accounting periodThe annual accounting period of the Company and its subsidiaries are from 1 January to 31 December.

Accounting and presentation currencyThe Company and its subsidiaries’ accounting currency is Vietnam Dong (“VND”). The consolidated financial statements are prepared and presented in million of Vietnam Dong (“VND million”). Regarding basic earnings per share, the Company presented this item in unit as described in Note 42.

(a)

(b)

(c)

(d)

Notes to the consolidated financial statements for the year ended 31 December 2021

(continued)



(iv)

(b)

(c)

(d)

(e)

(f)

(i)

(ii)

Asset acquisition and business combination

Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control is transferred to the Company. Control exists when the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that presently are exercisable are taken into account.

Under the purchase method, the assets and liabilities of the acquired entity are consolidated using their fair values. Cost of business combination consists of the aggregate fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the Company and its subsidiaries in exchange for control of the acquiree, and transaction costs. Goodwill represents the excess of the cost of business combination over the Company and its subsidiaries’ interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the acquired entity. When the excess is negative, it is recognised immediately in the consolidated statement of income.

Transaction costs, other than those associated with the issue of debt or equity securities, that the Company and its subsidiaries incurred in connection with business combinations included any costs directly attributable to the business combination, such as professional fees paid to accountants, legal advisers, valuers and other consultants to effect the business combination. Transaction costs are capitalised into the cost of business combination. General administrative costs and other costs that cannot be directly attributed to the particular business combination being accounted for are not included in the cost of the business combination, they are recognised as an expense when incurred.

The Company and its subsidiaries acquire subsidiaries that own real estate projects. At the date of acquisition, the Company and its subsidiaries consider whether the acquisition represents the acquisition of a business. The Company and its subsidiaries account for an acquisition as a business combination where an integrated set of activities is acquired.

When the acquisition of subsidiaries does not represent a business, it is accounted for as an acquisition of a group of assets and liabilities. The cost of the acquisition is allocated to the assets and liabilities acquired based upon their relative fair values, and no goodwill or deferred income tax is recognised.

Business combinations involving entities or business under common control

Business combination where the same group of shareholders (“the Controlling Shareholders”) control the combining companies before and after the business combination meets the definition of business combination under common control because there is a continuation of the risks and benefits to the Controlling Shareholders. Such common control business combination is specifically excluded from the scope of Vietnamese Accounting Standard 11 – Business Combination and in selecting its accounting policies with respect to such transaction, the Company and its subsidiaries have considered Vietnamese Accounting Standard 01 – Framework and Vietnamese Accounting Standard 21 – Presentation of Financial Statements. Based on these standards, the Company and its subsidiaries have adopted the followings.

• The assets and liabilities of the two combined entities are reflected at their carrying amounts on the date of business combination;

• No goodwill is recognised from the business combination;• The consolidated statement of income reflects the results of the combined entities from the date of the business

combination; and• Any difference between the cost of acquisition and net assets value acquired is treated as a deemed distribution to or

contribution from shareholders and recorded in equity.

Foreign currency

Transactions in currencies other than VND during the year have been translated into VND at actual rates of exchange ruling at the transaction dates.

Monetary assets and liabilities denominated in currencies other than VND are translated into VND at the account transfer buying rate and account transfer selling rate, respectively, at the end of the annual accounting period quoted by the commercial bank where the Company or its subsidiaries most frequently conduct transactions as at the end of annual accounting period.

All foreign exchange differences are recorded in the consolidated statement of income.

Cash and cash equivalents

Cash comprises call deposits and cash in transit. Cash equivalents are short-term highly liquid investments that are readily convertible to known amounts of cash, are subject to an insignificant risk of changes in value and are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes.

Investments

Held-to-maturity investments

Held-to-maturity investments are those that the Company and its subsidiaries have the intention and ability to hold until maturity. Held-to-maturity investments include term deposits at bank. These investments are stated at costs less allowance for diminution in value.

Accounts receivable from customers and other receivables

Accounts receivable from customers and other receivables are stated at cost less allowance for doubtful debts.

Inventories

Inventory properties

Properties constructed for sale in the ordinary course of business or for long-term lease qualified for recognition of outright sales, rather than for rental or capital appreciation, are recorded as inventory and are measured at the lower of cost incurred in bringing the inventories to their present location and condition, and net realisable value.

Cost includes:

• Freehold, leasehold rights for land, and land development costs;

• Construction costs payable to contractors; and

• Borrowing costs, consultancy and design costs, costs of site preparation, professional fees for legal services, property transfer taxes, directly attributable construction overheads and other related costs.

Net realisable value is the estimated selling price of inventory items, less the estimated costs of completion and estimated costs to sell.

The cost of inventory properties recognised in consolidated statement of income on sales is determined with reference to the specific costs incurred on the properties sold and an allocation of any non-specific costs based on an appropriate basis.

Other inventories

Other inventories are carried at the lower of cost incurred in bringing each product to its present location and condition and net realisable value.

Net realisable value represents the estimated selling price in the ordinary course of business less the estimated costs to completion and the estimated costs of sale.

The perpetual method is used to record the costs of other inventories on a weighted average basis.


(continued)



(g)

(i)

(ii)

(h)

(i)

(i)

(ii)

Intangible fixed assets

Software

Cost of acquiring new software, which is not an integral part of the related hardware, is capitalised and treated as an intangible asset. Software cost is amortised on a straight-line basis over 3 to 8 years.

Investment properties held to earn rental

Cost

Investment property held to earn rental is stated at cost less accumulated depreciation. The initial cost of an investment property held to earn rental comprises its purchase price, cost of land use rights and any directly attributable expenditures of bringing the property to the condition necessary for it to be capable of operating in the manner intended by the Board of Management. Expenditure incurred after the investment property held to earn rental has been put into operation, such as repairs and maintenance, is charged to the consolidated statement of income in the year in which the expenditure is incurred. In situations where it can be clearly demonstrated that the expenditure has resulted in future economic benefits in excess of the originally assessed standard of performance of the existing investment property held to earn rental, the expenditure is capitalised as an additional cost of the investment property.

Depreciation

Depreciation is computed on a straight-line basis over the estimated useful lives of investment property. The estimated useful lives are as follows:

The Company and its subsidiaries have contributed capital to cooperate in the investment, construction and development of shopping centers. Under business co-investment contracts, the Company and its subsidiaries have the right to control the shopping centers when the shopping centers are handed over to the Company and its subsidiaries from the counterparties for commercial operations. Accordingly, the shopping centers are recognised by the Company and its subsidiaries as investment properties in the consolidated balance sheet upon the hand over of these properties.

Construction in progress

Construction in progress represents the costs of construction and machinery which have not been fully completed or installed. No depreciation is provided for construction in progress during the period of construction and installation.

Prepaid expenses

Prepaid expenses are reported as short-term or long-term prepaid expenses on the consolidated balance sheet and amortised over the period for which the amounts are paid or the period in which economic benefits are generated in relation to these expenses.

Prepaid rentals

Prepaid rentals under operating lease terms are stated at their costs and amortised on a straight-line basis over lease terms.

Overhaul expenditures

Overhaul expenditures include major repair and maintenance prepaid expenses which are stated at their costs and amortised on a straight-line basis over a usual period of 3 years from the overhaul completion.

Tools and supplies

Tools and supplies include assets held for use by the Company and its subsidiaries in the normal course of business and not qualified for recognition as fixed assets under prevailing regulations. Costs of tools and supplies are amortised on a straight-line basis not exceeding 3 years.

Prepaid land costs

Prepaid land costs comprise prepaid land lease rentals, including those for which the Company and its subsidiaries obtained land use rights certificate but are not qualified as intangible fixed assets under prevailing laws and regulations, and other costs incurred in conjunction with securing the use of leased land. These costs are recognised in the consolidated statement of income on a straight-line basis over the term of the lease contract.

Selling expenses

Selling expenses comprise commission fees that are directly related to sale of inventory properties and lease of shopping malls. These expenses are capitalised under the prepaid expenses account in the consolidated balance sheet and subsequently expensed when the Company and its subsidiaries recognise revenue from the sale of the related inventory properties and lease of shopping malls.

Committed profits

Committed profits include prepayments to customer under business cooperation contracts and apartment management service program. Committed profits are capitalised under the prepaid expenses account in the consolidated balance sheet and subsequently expensed when the Company and its subsidiaries recognise revenue from service rendered over the term of management service program.

buildings, structures 5 – 15 years

machinery and equipment 2 – 15 years

office equipment 3 – 10 years

other assets 3 – 15 years

land use rights and buildings, structures 5 – 50 years

machinery and equipment 5 – 25 years

Tangible fixed assets

Cost

Tangible fixed assets are stated at cost less accumulated depreciation. The initial cost of a tangible fixed asset comprises its purchase price, including import duties, non-refundable purchase taxes and any directly attributable costs of bringing the asset to its working condition for its intended use. Expenditure incurred after tangible fixed assets have been put into operation, such as repair, maintenance and overhaul cost, is charged to the consolidated statement of income in the year in which the cost is incurred. In situations where it can be clearly demonstrated that the expenditure has resulted in an increase in the future economic benefits expected to be obtained from the use of tangible fixed assets beyond their originally assessed standard of performance, the expenditure is capitalised as an additional cost of tangible fixed assets.

Depreciation

Depreciation is computed on a straight-line basis over the estimated useful lives of tangible fixed assets. The estimated useful lives are as follows:

(j)

(k)

(i)

(ii)

(iii)

(iv)

(v)

(vi)


(continued)



(l)

(m)

(n)

(o)

(p)

(i)

(ii)

Goodwill

Goodwill arises on the acquisition of subsidiaries and associates. Goodwill is measured at cost less accumulated amortisation. Cost of goodwill represents the excess of the cost of the acquisition over the Company and its subsidiaries’ interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the acquiree. When the excess is negative (gain from bargain purchase), it is recognised immediately in the consolidated statement of income.

Goodwill arising on acquisition of a subsidiary is amortised on a straight-line basis over 10 years.

Accounts payable to suppliers and other payables

Accounts payable to suppliers and other payables are stated at their cost.

Provisions

A provision is recognised if, as a result of a past event, the Company and its subsidiaries have a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Provision for warranty expenses for apartments and shop-houses

The provision for warranties relates to sold standard-designed apartments and shop-houses. The provision is based on estimates derived from historical warranty data associated with the repair expenses of apartments and shop-houses sold in the past.

Bond issued

At initial recognition, straight bonds are measured at cost which comprises proceeds from issuance net of issuance costs. Any discount, premium or issuance costs are amortised on a straight-line basis over the term of the bond.

Share capital and share premium

Ordinary shares

Ordinary shares are recognised at issuance price less costs not directly attributable to the issue of shares, net of tax effects. Such costs less taxes directly related to the issue of shares are recognised as a deduction from share premium.

Repurchase of ordinary shares (treasury shares)

Before 1 January 2021

When shares recognized as equity are repurchased, the amount of the consideration paid, which includes directly attributable costs, net of tax effects, is recognized as a reduction from equity. Repurchased shares are classified as treasury shares under equity. When treasury shares are sold for reissue subsequently, cost of the reissued shares is determined on a weighted average basis. Any difference between the amount received and the cost of the shares reissued is presented within share premium.

From 1 January 2021

Treasury shares are recognised only in respect of repurchased shares which are aggregated fractions of share arising when the company issues shares to pay dividends or issues shares from equity reserves in accordance with an approved issuance plan, or repurchased odd-lots of shares as requested by the shareholders. In all other cases, when shares recognized as equity are repurchased, their par value amount is recognized as a reduction to share capital, and the Company shall carry out procedures for a decrease in charter capital equivalent to the total par value of shares redeemed by the Company. The difference between the par value and the amount of the consideration paid, which includes directly attributable costs, net of tax effects, is included in share premium. For those repurchased shares that can be sold afterwards, when treasury

shares are sold for reissue subsequently, cost of the reissued shares is determined on a weighted average basis. Any difference between the amount received and the cost of the shares reissued is presented within share premium.

This change in accounting policy has been applied prospectively from 1 January 2021 due to change in applicable laws and regulations on buying back shares.

Taxation

Income tax on the consolidated profit for the year comprises current and deferred tax. Income tax is recognised in the consolidated statement of income except to the extent that it relates to items recognised directly to equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted at the end of the annual accounting period, and any adjustment to tax payable in respect of previous years.

Deferred tax is provided using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amounts of assets and liabilities using the tax rates enacted or substantively enacted at the end of the annual accounting period.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

Revenue and other income

Revenue from sale of inventory properties

Revenue from transfer of standard-designed apartments and shophouses which do not require significant customisation for each customer is recognised when the significant risks and rewards of ownership of the properties have been passed to the buyer.

Revenue from sale of inventory properties also includes long-term lease of real estate properties qualified for recognition of outright sales. If the lease-term is greater than 90% of the asset’s useful life, the Company and its subsidiaries will recognise the revenue for the entire prepaid lease payment if all of the following conditions are met:

• Lessee is not allowed to cancel the lease contract during the lease term, and the lessor is not responsible for reimbursing the prepaid lease payments under any circumstances;

• The prepaid lease payment is not less than 90% of the total estimated lease payment collected under contract over the lease period and lessee must pay all rental within 12 months from the commencement of the lease;

• Significant risks and rewards associated with the ownership of leased assets are transferred to the lessee; and

• The full cost of the lease must be reasonably estimated.

Revenue from leasing investment properties

Rental income arising from operating lease of properties is recognised in the consolidated statement of income on a straight line basis over the lease term. Lease incentives granted (if any) are recognised as a deduction of the total rental income.

Rendering of services

Revenue from services rendered is recognised in the consolidated statement of income when the services are rendered. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due.

(q)

(r)

(i)

(ii)

(iii)


(continued)



Interest income

Interest income is recognised in the consolidated statement of income on a time proportion basis with reference to the principal outstanding and the applicable interest rate.

Leased assets

The determination of whether an arrangement is, or contains a lease is based on the substance of the arrangement at inception date and requires an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset and the arrangement conveys a right to use the asset.

A lease is classified as a finance lease whenever the terms of the lease transfer substantially all the risks and rewards of ownership of the asset to the lessee. All other leases are classified as operating leases.

Where the Company and its subsidiaries are the lessee

Assets held under finance leases are capitalised in the consolidated balance sheet at the inception of the lease at the fair value of the leased assets or, if lower, at the net present value of the minimum lease payments. The principal amount included in future lease payments under finance leases are recorded as a liability. The interest amounts included in lease payments are charged to the consolidated statement of income over the lease term to achieve a constant rate on interest on the remaining balance of the finance lease liability.

Capitalised finance leased assets are depreciated using straight-line basis over the shorter of the estimated useful life of the asset and the lease term.

Assets subject to finance leases are included as the Company and its subsidiaries’ investment properties and long-term prepaid expenses in the consolidated balance sheet.

Rentals under operating leases are charged to the consolidated statement of income on a straight-line basis over the lease term.

Where the Company and its subsidiaries are the lessor

Assets subject to operating leases are included as the Company and its subsidiaries’ investment properties in the consolidated balance sheet.

Lease income is recognised in the consolidated statement of income on a straight-line basis over the lease term. Lease incentives granted (if any) are recognised as a deduction of the total rental income.

Borrowing costs

Borrowing costs are recognised as an expense in the year in which they are incurred, except where the borrowing costs relate to borrowings in respect of the construction of qualifying assets, in which case the borrowing costs incurred during the year of construction are capitalised as part of the cost of the assets concerned.

Earnings per share

The Company presents basic earnings per share (“EPS”) for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to the ordinary shareholders (after deducting any amounts appropriated to bonus and welfare fund for the accounting period) of the Company by the weighted average number of ordinary shares outstanding during the year. As at 31 December 2021 and for the year then ended, the Company has no potential ordinary shares hence disclosure for diluted EPS is not applicable.

(iv)

(s)

(t)

(u)

(v)

(w)

(x)

Segment reporting

A segment is a distinguishable component of the Company and its subsidiaries that is engaged either in providing related products or services (business segment), or in providing products or services within a particular economic environment (geographical segment), which is subject to risks and rewards that are different from those of other segments. The Company and its subsidiaries’ primary format for segment reporting is based on business segments.

Related parties

Parties are considered to be related to the Company and its subsidiaries if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions, or where the Company and its subsidiaries and the other party are subject to common control or significant influence. Related parties may be individuals or corporate entities and include close family members of any individual considered to be a related party.

Comparative information

Comparative information in these consolidated financial statements is presented as corresponding figures. Under this method, comparative information for the prior year are included as an integral part of the current year financial statements and are intended to be read only in relation to the amounts and other disclosures relating to the current year. Accordingly, the comparative information included in these consolidated financial statements is not intended to present the Company’s consolidated financial position, consolidated results of operation or consolidated cash flows for the prior year.


(continued)



For the year ended 31 December 2021


Leasing activities and rendering of related services

Others Total segments

Elimination Consolidated

VND million VND million VND million VND million VND million VND million

External revenue 1,004,103 4,700,630 186,408 5,891,141 - 5,891,141

Inter-segment revenue - 65,461 153,357 218,818 (218,818) -

Total segment revenue 1,004,103 4,766,091 339,765 6,109,959 (218,818) 5,891,141

Segment results 323,119 1,560,442 (132,654) 1,750,907 6,267 1,757,174

Financial income 387,018

Financial expenses 486,280

Net operating profit 1,657,912

Other income 84,095

Other expenses 49,730

Income tax expense 377,264

Net profit after tax 1,315,013




Others Total segments

Elimination Consolidated

VND million VND million VND million VND million VND million VND million

External revenue 2,149,022 6,008,061 171,835 8,328,918 - 8,328,918

Inter-segment revenue - 80,932 242,968 323,900 (323,900) -

Total segment revenue 2,149,022 6,088,993 414,803 8,652,818 (323,900) 8,328,918

Segment results 780,971 2,485,152 (191,161) 3,074,962 17,717 3,092,679

Financial income 275,859

Financial expenses 467,092

Net operating profit 2,901,446

Other income 123,527

Other expenses 32,253

Income tax expense 610,411

Net profit after tax 2,382,309

4. Segment reporting

Business segments

The Company and its subsidiaries comprise the following main business segments:

• Sale of inventory properties;• Leasing of investment properties and providing related services; and• Others.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Segment revenue, expenses and results include transfer between business segments. Such transfers are eliminated on consolidation.

(a)


(continued)



As at 31 December, 2021 Sale of inventory

properties


Others Consolidated

VND million VND million VND million VND million

Segment assets 797,398 32,822,362 389,738 34,009,498

Unallocated assets 3,863,990

Total assets 37,873,488

Segment liabilities 1,090,595 2,246,125 95,036 3,431,756

Unallocated liabilities 3,790,903

Total liabilities 7,222,659


Capital expenditure - 291,854 - 291,854

Depreciation of tangible fixed assets - 19,828 14,334 34,162

Amortisation of intangible fixed assets and goodwill - 80,363 - 80,363

Depreciation of investment property - 1,373,699 - 1,373,699

As at 1 January 2020 Sale of inventory

properties


Others Consolidated


Segment assets 692,577 33,684,146 383,652 34,760,375

Unallocated assets 5,056,057

Total assets 39,816,432

Segment liabilities 1,220,759 2,803,916 187,586 4,212,261

Unallocated liabilities 6,268,355

Total liabilities 10,480,616


Capital expenditure - 1,395,110 - 1,395,110

Depreciation of tangible fixed assets - 19,126 17,384 36,510

Amortisation of intangible fixed assets and goodwill - 82,037 - 82,037

Depreciation of investment property - 1,359,517 - 1,359,517

Details of unallocated assets and liabilities are as follows:

31/12/2021VND million

1/1/2021VND million

Cash and cash equivalents 3,297,060 3,050,907

Short-term financial investments 190,424 1,894,314

Loans receivables 295,000 -

Interest income receivables from term deposits, other deposits and loan receivables 37,528 52,635

Receivables for payment on behalf 2,956 6,713

Prepaid provisional corporate income tax 1,645 3,771

Deductible value added tax 22,965 31,150

Taxes receivable from State Treasury 380 535

Deferred tax assets 16,032 16,032

Unallocated assets 3,863,990 5,056,057

Taxes and others payable to State Treasury 489,648 321,533

Accrued bond interests 65,008 140,364

Dividends payable 2,233 2,233

Short-term bonds and finance lease liabilities 19,887 19,887

Long-term bonds and finance lease liabilities 3,137,924 5,706,162

Deferred tax liabilities 76,203 78,176

Unallocated liabilities 3,790,903 6,268,355

Geographical segments

The Company and its subsidiaries operate in one single geographical segment which is Vietnam.

(b)


(continued)



5. Cash and cash equivalents


1/1/2021VND million

Cash in transit 24 75

Cash in banks 1,788,860 1,030,832

Cash equivalents 1,508,176 2,020,000

3,297,060 3,050,907

Cash equivalents as at 31 December 2021 included term deposits in VND with original terms ranging from one to three months and earned interest at the rates ranging from 4.0% - 7.5% per annum (1 January 2021: from 2.9% - 4.0% per annum).

6. Held-to-maturity investments


1/1/2021VND million

Held-to-maturity investments – short-term

Term deposits 190,424 1,894,314

Held-to-maturity investments – short-term represented term deposits with original terms ranging from 6 to 12 months and earned interest at the rates ranging from 3.70% - 6.03% per annum (1 January 2021: from 4.0% - 6.3% per annum).

7. Accounts receivable from customers


1/1/2021VND million

Receivables from leasing activities and rendering of related services 897,974 660,921

Receivables from sale of inventory properties 165,558 111,001

Others 103,177 46,075

1,166,709 817,997

7. Accounts receivable from customers (continued)

In which:


1/1/2021VND million

Related parties:

Vinhomes Joint Stock Company 82,325 23,109

VinFast Commercial and Services Trading Limited Liability Company 21,107 38,179

Other related parties 19,862 15,552

Third parties:

Receivable from two customers 70,433 127,010

Other customers 972,982 614,147

1,166,709 817,997

8. Prepayments to suppliers – short-term


1/1/2021VND million

Related parties:

Other related parties - 4,337

Third parties:

Other suppliers 42,620 92,799

42,620 97,136

9. Loans receivable

Annual interest rate


1/1/2021VND million

Other related parties

VinFast Production and Trading Joint Stock Company 10% 295,000 -


(continued)



10. Other receivables

(a) Other short-term receivables comprise:


1/1/2021VND million

Interest income receivables from term deposits and other deposits 37,528 52,635

Receivables for payment on behalf 2,956 6,713

Receivables for investment purposes (*) 69,680 457,909

Deposits for projects and contracts 12,727 12,728

Others 19,825 15,437

142,716 545,422

(*) These receivables due from a related party are related to investment deposits exceeding estimated cost of the shopping mall components of a number of real estate projects.

In which, other short-term receivables from related parties:


1/1/2021VND million

Parent company:

Vingroup Joint Stock Company 172 144,695

Other related parties:

Green City Development JSC 5,584 -


Vietnam Investment and Consulting Investment JSC 69,872 69,857

Central Park Development LLC - 41,287


99,401 485,235

(b) Other long-term receivables


1/1/2021VND million

Deposits for leasing office and commercial centres 6,110 8,308

11. Allowance for doubtful debts

Movements of the allowance for doubtful debts during the year were as follows:

2021VND million

2020VND million

Opening balance 14,466 11,456

Increase in allowance during the year 145,452 10,624

Utilisation during the year - (7,614)

Written off (587) -

Closing balance 159,331 14,466

12. Inventories

31/12/2021 1/1/2021

CostVND million

AllowanceVND million

CostVND million

AllowanceVND million

Inventory properties under construction 461,939 - 422,004 -

Completed inventory properties 102,032 - 77,251 -

Other inventories 18,947 - 20,634 -

582,918 - 519,889 -

13. Other assets


1/1/2021VND million

Other current assets

Deposits to related parties for investment purposes 1,203,400 -

Other long-term assets

Deposits to related parties for investment purposes 2,404,420 2,789,702

3,607,820 2,789,702

These are deposits to the counterparties for the co-investment and co-operation of the shopping mall components of a number of real estate projects. These deposits require no collaterals. In accordance with these contracts, the counterparties have committed to transfer the shopping mall component of their properties to the Company and its subsidiaries, or to grant the Company and its subsidiaries the right to purchase the shopping malls.


(continued)



Deposits to related parties for investments


1/1/2021VND million

Parent company:

Vingroup Joint Stock Company 1,584,000 958,000

Other related parties:

Thai Son Investment Construction Corporation 1,203,400 1,011,282

Can Gio Tourist City Corporation 163,000 163,000

Green City Development JSC 657,420 657,420

3,607,820 2,789,702

14. Tangible fixed assets

Buildings,structures

Machinery and equipment

Officeequipment

Other assets

Total

VND million VND million VND million VND million VND million

Cost

Opening balance 280,898 265,426 23,766 25,543 595,633

Additions - 32,335 462 - 32,797

Disposals (4,478) (3,858) (1,024) (49) (9,409)

Closing balance 276,420 293,903 23,204 25,494 619,021

Accumulated depreciation

Opening balance 22,461 120,560 12,226 10,180 165,427

Charge for the year 4,509 23,964 2,986 2,703 34,162

Disposals (2,606) (3,365) (1,024) (49) (7,044)

Closing balance 24,364 141,159 14,188 12,834 192,545

Net book value

Opening balance 258,437 144,866 11,540 15,363 430,206

Closing balance 252,056 152,744 9,016 12,660 426,476

Included in tangible fixed assets were assets costing VND72,549 million which were fully depreciated as at 31 December 2021 (1 January 2021: VND49,030 million), but which are still in active use.

Details of tangible fixed assets used as collaterals for bonds issued by the Company and its subsidiaries are presented in Note 27(b)(ii).

15. Intangible fixed assets

Software

VND million

Cost

Opening balance 54,391

Additions 52

Closing balance 54,443

Accumulated amortisation


Charge for the year 7,780


Net book value



Included in intangible fixed assets were assets costing VND3,802 million which were fully depreciated as at 31 December 2021 (1 January 2021: VND3,677 million), but which are still in active use.


(continued)



16. Investment property

Land use right and buildings, structures

Machinery and equipment

Total

VND million VND million VND million

Cost

Opening balance 27,542,687 6,167,533 33,710,220

Additions 31,400 29 31,429

Decrease upon finalisation (4,030) (65,072) (69,102)

Transfers to inventory properties (11,104) (4,170) (15,274)

Written off (48,153) - (48,153)

Closing balance 27,510,800 6,098,320 33,609,120


Opening balance 3,517,613 2,460,434 5,978,047

Charge for the year 794,889 578,810 1,373,699

Transfers to inventory properties (1,576) (3,012) (4,588)

Written off (6,802) - (6,802)

Closing balance 4,304,124 3,036,232 7,340,356

Net book value

Opening balance 24,025,074 3,707,099 27,732,173

Closing balance 23,206,676 3,062,088 26,268,764

Investment properties mainly include assets of the shopping malls of the Company and its subsidiaries which are used for provision of leasing and other related services.

As at 31 December 2021, the Company and its subsidiaries are in the process of determining the fair values of these investment properties.

Details of investment properties used as collaterals for bonds issued by the Company and its subsidiaries are disclosed in Note 27(b)(ii).

As at 31 December 2021, land use rights and assets attached to land of one shopping mall owned by the Company and its subsidiaries were used as collaterals for loans of a subsidiary of the Company’s parent company.

Rental commitment under operating leases are disclosed in Note 31.

17. Construction in progress

2021 VND million

2020 VND million


Additions 296,678 382,205

Transfers to tangible fixed assets - (8,222)

Transfers to investment properties - (49,737)

Transfer to short-term prepayments - (190)

Transfer to long-term prepayments - (19,205)

Closing balance 1,255,909 959,231

Detailed by constructions in progress which account for more than 10% of total were as follows:


1/1/2021VND million

Vincom Plaza My Tho project 294,176 284,107

Vincom Plaza Bac Lieu project 237,588 215,724

Suoi Hoa Hotel 172,377 123,529

Vincom Plaza Bien Hoa 2 project 135,650 135,650

Vincom+ Song Cong project 111,268 110,084

Vincom Dien Bien Project 138,435 -

Vincom Quang Tri Project 68,064 -

Other projects 98,351 90,137

1,255,909 959,231

During the year, borrowing costs capitalised into construction in progress is VND21,215 million (2020: VND10,715 million).


(continued)



18. Prepaid expenses

(a) Short-term prepaid expenses


1/1/2021VND million

Prepaid selling expenses related to sale of inventory properties not yet handed over 27,612 46,583

Prepaid provisional corporate income tax 1,645 3,771

Others 12,462 19,159

41,719 69,513

(b) Long-term prepaid expenses


1/1/2021VND million

Prepaid rentals 237,787 247,997

Overhaul expenditures 131,130 164,339

Tools and supplies 19,262 22,048

Others 7,108 79,778

395,287 514,162

Included in the carrying amount of long-term prepaid expenses was an amount of VND237,787 million prepaid to a related party, Ecology Development and Investment Joint Stock Company, as at 31 December 2021 (1 January 2021: VND247,997 million).

19. Deferred tax assets and deferred tax liabilities

Recognised deferred tax assets and deferred tax liabilities

Tax rate


1/1/2021VND million

Deferred tax assets:

Unearned revenue 20% 6,951 6,951

Revaluation of subsidiaries’ net assets at merger date and others 20% 9,081 9,081

Total deferred tax assets 16,032 16,032

Deferred tax liabilities:

Fair value adjustment on acquisition of a subsidiary 20% 37,250 38,130

Difference from recognition of outright sales transactions – unearned revenue 20% 23,271 24,281

Revaluation of subsidiaries’ net assets at merger date 20% 10,346 10,404

Depreciation 20% 5,336 5,361

Total deferred tax liabilities 76,203 78,176

20. Goodwill

VND million

Cost

Opening and closing balances 725,837



Charge for the year 72,583


Net book value



21. Accounts payable to suppliers

Cost & amount within payment capacity

31/12/2021 1/1/2021

VND million VND million

Related parties 263,376 357,888

Vietnam Investment and Consulting Investment JSC 2,013 3,834


Vinpearl Joint Stock Company 82,575 103,294

Vingroup Joint Stock Company 118,663 92,725

Gia Lam Urban Investment and Development Company Limited 9,296 123,173


Third parties 262,807 430,474

Other suppliers 262,807 430,474

526,183 788,362

22. Advance from customers – short-term

31/12/2021 1/1/2021

VND million VND million

Advance from customers under real estate sale and purchase agreements 187,547 398,317

Others 90,632 31,518

278,179 429,835


(continued)



23. Taxes other payables to State Treasury

1/1/2021VND million

Incurred VND million

Paid VND million


Corporate income tax 281,165 377,111 (583,752) 74,524

Value added tax 33,263 363,766 (340,880) 56,149

Land rental and usage 1,913 402,107 (48,439) 355,581

Personal income tax 5,084 48,287 (50,083) 3,288

Other taxes 108 460 (462) 106

321,533 1,191,731 (1,023,616) 489,648

24. Accrued expenses


1/1/2021VND million

Accrued construction costs 272,951 467,777

Accrued loan interests 65,008 140,364

Accrued commission and brokerage fee 66,414 59,531

Accrued committed profit relating to business cooperation contracts and apartment management service program

44,997 50,247

Others 179,494 291,413

628,864 1,009,332

Accrued expenses payable to related parties


1/1/2021VND million


25. Unearned revenue

(a) Unearned revenue – short-term


1/1/2021VND million

Portion of long-term unearned revenue to be realised within 12 months 65,797 164,209

Revenue received in advance from other services 25,574 -

Amount to be realised within 12 months 91,371 164,209

(b) Unearned revenue – long-term


1/1/2021VND million

Revenue received in advance from leasing activities and rendering of related services

165,903 250,390

Amount to be realised within 12 months (65,797) (164,209)

Amount to be realised after 12 months 100,106 86,181

(c) Unearned revenue from related parties


1/1/2021VND million



44,957 35,363

26. Other payables

(a) Other payables - short-term


1/1/2021VND million

Deposits under deposit contracts and loan agreements received from customers 225,117 269,067

Deposits from tenants for leasing offices, counters and shophouses to be refunded within the next 12 months

423,536 364,032

Deposits received for maintenance of handed-over properties 91,846 82,208

Deposits for site construction 50,386 46,357

Dividends payable 2,233 2,233

Others 45,870 22,622

838,988 786,519


(continued)



26. Other payables (continued)

(b) Other payables - long-term


1/1/2021VND million

Deposits from tenants for leasing offices and counters – shopping center 1,225,755 1,220,857

Deposits from tenants for leasing offices and counters to be refunded within the next 12 months – shopping center

(423,536) (364,032)

Deposit under business cooperation contracts 180,000 180,000

Other deposits 36,151 35,404

Amount due after 12 months 1,018,370 1,072,229

(c) Other payables to related parties


1/1/2021VND million

Other payables – short-term



21,030 20,825

Other payables – long-term

Vinpearl Joint Stock Company 184,774 180,144

VinFast Commercial and Services Trading Limited Liability Company 40,362 16,018

Vinschool One Member LLC 3,872 6,375


233,322 206,759

27. Bonds and finance lease liabilities

(a) Short-term bonds and finance lease liabilities

Carrying amount & amount within

repayment capacity

Movements during the year

Carrying amount & amount within

repayment capacity

1/1/2021 Increase Decrease 31/12/2021


Finance lease principals due within 12 months with related parties (Note 27(b))

19,887 21,378 (21,378) 19,887

27. Bonds and finance lease liabilities (continued)

(b) Long-term bonds and finance lease liabilities


1/1/2021VND million

Finance lease liabilities with a related party (i) 191,819 191,281

Corporate bonds (ii) 2,965,992 5,534,768

3,157,811 5,726,049

Repayable within twelve months (19,887) (19,887)

Repayable after twelve months 3,137,924 5,706,162

(i) Finance lease liabilities

Finance lease liabilities related to long-term lease contracts with commercial centres of Vincom Plaza Quang Trung and Vincom Plaza Le Van Viet. The minimum lease payments for these non-cancellable finance lease contracts are as follows:

31/12/2021

Total finance lease payments

Interests Principals


Within 1 year 21,397 1,510 19,887

Within 2 to 5 years 89,332 27,145 62,187

More than 5 years 482,657 372,912 109,745

593,386 401,567 191,819

1/1/2021

Total finance lease payments

Interests Principals


Within 1 year 21,397 1,510 19,887

Within 2 to 5 years 87,192 26,366 60,826

More than 5 years 506,114 395,546 110,568

614,703 423,422 191,281


(continued)



(ii) Corporate bonds

Bond arranger 31/12/2021VND million

1/1/2021VND million

Maturity date Annual interest rate Secured assets

Vietnam Bank for Industry and Trade Securities Joint Stock Company

- 2,597,107 Interest rate applied for the first year is 8.1% per annum, and the rate for the subsequent year is floating, being adjusted once per year and is determined by the paid-in-arrears interest rate of 12-month VND savings in Vietnam Joint Stock Commercial Bank for Industry and Trade - Hanoi Branch plus (+) 3%.

Techcom Securities Joint Stock Company

2,965,992 2,937,661 17 April 2023, 27 April 2023 and 26 August 2025

Interest rate applied for the first year is 9.5% to 10% per annum, and the rate for the subsequent years is floating, being adjusted once per quarter and is determined by the average interest rate of 12-month VND savings in Joint stock Commercial Bank for Investment and Development of Viet Nam; Vietnam Joint Stock Commercial Bank for Industry and Trade; Joint Stock Commercial Bank for Foreign Trade of Vietnam and Vietnam Technology and Commercial Joint Stock Bank plus (+) from 3.25% or 3.5%.

(*)

2,965,992 5,534,768

(*) These bonds are secured by land use rights and assets attached to land of one shopping mall owned by a subsidiary.

28. Provisions – short-term

Provisions – short-term represented the provision for warranty for commercial area and shop-houses.

2021VND million

2020VND million


Provision made during the year 1,824 1,992

Provision reversed during the year (2,875) (10,069)

Provision used during the year - (624)

Closing balance 14,040 15,091

29. C

hang

es in

ow

ners

’ equ

ity

O

rdin

ary

shar

es

with

vot

ing

right

sSh

are

prem

ium

Trea

sury

sh

ares

Oth

er e

quity

fu

nds

Undi

strib

uted

pr

ofits

Non

-con

trolli

ng

inte

rest

Tota

l

VND

milli

onVN

D m

illion

VND

milli

onVN

D m

illion

VND

milli

onVN

D m

illion

VND

milli

on

Bala

nce

as a

t 1 J

anua

ry 2

020

23,2

88,18

446

,983

(1,9

54,2

58)

(53,

420)

5,59

2,14

833

,870

26,9

53,5

07

Net

pro

fit fo

r the

yea

r-

--

-2,

381,8

5545

42,

382,

309

Bala

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as a

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88,18

446

,983

(1,9

54,2

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(53,

420)

7,974

,003

34,3

2429

,335

,816

Net

pro

fit fo

r the

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r-

--

-1,3

14,5

1050

31,3

15,0

13

Bala

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as a

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Dece

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123

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46,9

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288,

513

34,8

2730

,650

,829


(continued)



30. Share capital

31. Off balance sheet items

The Company’s authorised and issued share capital are as follows:

31/12/2021 & 1/1/2021

Number of shares VND million

Authorised and issued share capital

Ordinary shares 2,328,818,410 23,288,184

Treasury shares

Ordinary shares 56,500,000 1,954,258

Shares in circulation

Ordinary shares 2,272,318,410 22,723,184

Share premium - 46,983

All ordinary shares have a par value of VND10,000. Each share is entitled to one vote at meetings of the Company. Shareholders are entitled to receive dividend as declared from time to time. All ordinary shares are ranked equally with regard to the Company’s residual assets. In respect of shares bought back by the Company, all rights are suspended until those shares are reissued.

Lease commitments

Commitment under operating leases where the Company and its subsidiaries are the lessor

The Company and its subsidiaries, as lessor, leased retail outlets under operating lease agreements. The minimum lease payments under these agreements as at the end of the accounting period are as follows:

(a)

31/12/2021 VND million

1/1/2021VND million

Within one year 3,772,387 4,151,260

Within two to five years 7,091,877 7,729,630

More than five years 5,399,071 5,637,899

16,263,335 17,518,789

Other commitments

Commitment for co-developing shopping malls

Under business cooperation contracts between the Company and its subsidiaries and Vingroup Joint Stock Company and some companies within Vingroup Joint Stock Company (hereby referred to as “the counterparties”), the Company and its subsidiaries are committed to acquire equity interests in target companies, which will be established to own and operate a number of shopping malls in the provinces and cities after certain conditions under the contracts are satisfied. The Company and its subsidiaries provide funds to the counterparties to construct the malls. In case the counterparties do not complete the necessary procedures to transfer the shopping centers to the target companies, the parties to the contract will cooperate to manage the operations of these shopping malls. The Company and its subsidiaries commit to take over the management and operations of these shopping malls and share a portion of profit to the counterparties.

Commitments under business cooperation contracts relating to shopping mall projects

As disclosed in Note 13, the Company and its subsidiaries signed agreements and business cooperation contracts with Vingroup Joint Stock Company and some companies within Vingroup Joint Stock Company (hereby named as “the counterparties”) for cooperation in the development and operation of the shopping mall components of a number of real estate projects. Under these contracts, the counterparties commit to transfer the shopping mall components of these projects to the Company and its subsidiaries; or to grant the Company and its subsidiaries with the right to purchase the shopping malls. Under these contracts, the Company and its subsidiaries are expected to make additional payments estimated at VND158,790 million (1 January 2021: VND418,742 million) to these counterparties.

Capital commitments

The Company and its subsidiaries have entered into construction contracts on the development of real estate projects. The estimated commitments amount of these contracts amount to VND543,830 million (1 January 2021: VND992,797 million).

Commitment under operating leases where the Company and its subsidiaries are the lessee

The Company and its subsidiaries, as lessees, entered into certain operating lease agreements with the minimum lease payments under these agreements as at the end of the accounting period as follows:

(c)

(b)

31/12/2021 VND million

1/1/2021VND million

Within one year 138,770 166,405

Within two to five years 491,562 660,228

More than five years 2,783,072 3,325,487

3,413,404 4,152,120


(continued)



Commitments to transfer a part of Towers A&B of Vincom Centre Ba Trieu

On 31 July 2006, Vingroup Joint Stock Company signed an agreement to transfer a portion of Vincom City Towers to a corporate counterparty. According to this agreement and its subsequent obligation transferring agreements, Vincom Retail Operation Company Limited, a subsidiary of the Company, is committed to transfer the following investment properties to this corporate counterparty on 20 July 2052:

• A half of commercial area (from 1st floor to 6th floor of Towers A&B Vincom City except for the reception and elevator waiting area of 160 sqm on the 1st floor); and

• A half of the basements of the towers.

Commitments related to program of management services and apartment rental

Vincom Retail Operation Company Limited, a subsidiary of the Company, has signed contracts to provide management and leasing services to customers who bought apartments at Vinpearl Riverfront Condotel Da Nang. Accordingly, for the five years from the date of apartments being handed over, customers are guaranteed by the investor to receive a higher amount between specific percentage on the selling price and 85% on the annual net leasing income from the sublease of the apartment to third parties.

32. Revenue from sale of goods and provision of services

Total revenue represents the gross value of goods sold and services rendered exclusive of value added tax.Net revenue comprised:

2021VND million

2020 VND million

Total revenue

• Revenue from sale of inventory properties 1,004,103 2,149,022

• Revenue from leasing activities and rendering of related services 4,700,630 6,008,061

• Other revenue 186,408 171,835

Net revenue 5,891,141 8,328,918

33. Cost of sales

2021VND million

2020 VND million

Total cost of sales

• Cost from sale of inventory properties 495,449 1,115,177

• Cost from leasing activities and rendering of related services 2,701,416 3,056,868

• Cost from other services 302,171 335,586

3,499,036 4,507,631

34. Financial income

2021VND million

2020 VND million

Interest income from deposits and loans 387,018 275,859

35. Financial expenses

2021VND million

2020 VND million

Interests on bonds and finance lease 445,044 443,319

Amortisation of bond issuing costs 41,132 20,267

Other financial expenses 104 3,506

486,280 467,092

36. Selling expenses

2021VND million

2020 VND million

Staff costs 39,747 60,328

Marketing expenses 25,416 126,050

Depreciation and amortisation 7,022 7,782

Consultancy, commission and brokerage fee 128,308 131,651

Outside service expenses 161 1,353

Others 1,110 2,876

201,764 330,040


(continued)



37. General and administration expenses

2021VND million

2020 VND million

Staff costs 61,357 140,122

Management fee 108,843 118,442

Depreciation and amortisation 80,079 81,936

Provisions 145,452 10,624

Outside service expenses 31,813 39,744

Others 5,623 7,700

433,167 398,568

38. Other income

2021VND million

2020 VND million

Penalties received 18,605 72,089

Others 65,490 51,438

84,095 123,527

39. Other expenses

2021VND million

2020 VND million

Contract compensation paid 1,182 3,886

Loss on disposal and written-off of fixed assets 38,473 13,489

Others 10,075 14,878

49,730 32,253

40. Production and business costs by elements

2021VND million

2020 VND million

Cost of construction and development of real estate properties 560,165 647,976

Staff costs 382,400 560,945

Depreciation and amortisation 1,492,420 1,482,557

Outside services expenses 1,615,019 1,859,948

Other expenses 148,679 218,160

41. Income tax(a) Recognised in the consolidated statement of income

2021VND million

2020 VND million

Current tax expense

Current year 379,237 618,663

Under provision of corporate income taxes in prior years - 578

379,237 619,241

Deferred tax benefit

Origination and reversal of temporary differences (1,973) (8,830)

Income tax expenses 377,264 610,411

(b) Reconciliation of effective tax rate

2021VND million

2020 VND million

Accounting profit before tax 1,692,277 2,992,720

Tax at the Company’s tax rate 338,455 598,544

Non-deductible expenses 635 924

Amortisation of goodwill 14,517 14,517

Unrecognised deferred tax 25,025 (1,854)

Other adjustments - (1,055)

Tax incentives (*) (1,368) (1,243)

Under provision of corporate income taxes in prior years - 578

377,264 610,411

(*) Under Resolution No. 406/NQ-UBTVQH15 dated 19 October 2021 on reduction of corporate income tax payable for the year ended 31 December 2021 applicable to tax payers subject to the corporate income tax law, Suoi Hoa Urban Development and Investment Joint Stock Company, the Company’s subsidiary, is entitled to a 30% reduction in corporate income tax payable for the year ended 31 December 2021 as its total revenue from sales of goods and services in 2021 did not exceed VND200 billion and lower than its total revenue from sales of goods and services in 2019.


(continued)



Applicable tax rates(c)

The Company and its subsidiaries have an obligation to pay corporate income tax to the government at corporate income tax rate of 20%.

Basic earnings per share

The calculation of basic earnings per share for the year ended 31 December 2021 was based on the profit attributable to ordinary shareholders after deducting amount appropriated to bonus and welfare fund for the annual accounting period, of VND1,314,510 million (2020: VND2,381,855 million) and a weighted average number of ordinary shares outstanding of 2,272,318,410 (2020: 2,272,318,410 shares), calculated as follows:

42. Earnings per share

(i)

(ii)

(iii)

Net profit attributable to ordinary shareholders

Weighted average number of ordinary shares

Earnings per share

2021VND million

2020 VND million

Net profit attributable to ordinary shareholders after bonus and welfare fund accruals

1,314,510 2,381,855

2021 2020

Weighted average number of ordinary shares during the year – currently in circulation

2,272,318,410 2,272,318,410

2021VND

2020 VND

Earnings per share 578 1,048

43. Significant transactions with related parties

Terms and conditions of transactions with related parties:

During the year, the Company and its subsidiaries sold goods and services to and purchased goods and services from related parties based on contractual agreement.

Accounts receivable from or payable to related parties are under normal course of business and are receivable or payable based on contractual agreements.

In addition to related party balances disclosed in other notes to the consolidated financial statements, the Company and its subsidiaries had the following significant transactions with related parties during the year:

Transaction value

2021 VND million

2020VND million

PARENT COMPANY

Vingroup Joint Stock Company

Purchase of goods and services 126,666 151,597

Deposits for investment 1,070,000 579,587

Collection of deposits for investment 625,992 -

Interest income from investment deposits 6,036 9,905

OTHER RELATED COMPANIES

Vinhomes Joint Stock Company

Sales of goods and services 253,358 284,778


Deposits for investment - 649,806


Vinpearl Joint Stock Company

Lending 1,250,000 -

Collection of loans 1,250,000 -

Interest income from loans 49,658 -



VinFast Production and Trading Joint Stock Company

Sales of goods and services 15,823 38

Lending 295,000 -

Interest income from loans 5,173 -


(continued)



Transaction value

2021 VND million

2020VND million

OTHER RELATED COMPANIES (continued)

VinFast Trading and Service Limited Liability Company


Ecology Development and Investment Joint Stock Company

Rental expense 27,814 39,867

Vinschool One Member LLC


Vietnam Investment and Consulting Investment JSC


Thai Son Investment Construction Corporation

Sales of goods and services 118 60

Deposits for investment 192,118 930,282


Gia Lam Urban Investment and Development Company Limited

Sales of goods and services - 166

Deposits for investment 131,396 550,294

Interest income from investment deposits - 5,693

Central Park Development LLC



Green City Development JSC



Cangio tourist City Corporation


Vinsmart Research and Manufacture JSC

Lending - 1,050,000

Collection of loans - 1,050,000

Interest income from loans - 25,698

Members of the Board of Directors and Board of Management

Salary and bonus 27,845 28,438

24 March 2022

44. Comparative information

The comparative information as at 1 January 2021 was derived from the balances and amounts reported in the Company’s consolidated financial statements as at and for the year ended 31 December 2020.





(continued)



To:• States Securities Commission of Vietnam• Ho Chi Minh Stock Exchange• The Company archives

THE LEGAL REPRESENTATIVE OF THE COMPANY (Signature, Full name and the Company seal)

Tran Mai Hoa Chief Executive Officer

142 Chapter 06 - Consolidated Financial Statements

VINCOM RETAIL JOINT STOCK COMPANYNo.7 Bang Lang 1, Vinhomes Riverside Ecological Urban Area,Viet Hung Ward, Long Bien District, Hanoi, Vietnam.

Telephone: (+84) 24 3974 9999Website: www.vincom.com.vn

TRUSTED PARTNER BOLD PIONEER - Vincom Retail

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