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

Group Assignment FIN202 TEAM 3
Digital Marketing (mkt308)

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PNJ’S FINANCE
Group Assignment – FIN202

GROUP MEMBERS: 1. NGUYEN SON TUNG – HS120529
2. LE THI MY DUYEN – HS150531
3. LO DUY TUNG – HS153072
4. DINH PHUONG NGA – HS150244
5. DAO MANH HIEU – HS153198
CLASS:

IB1602

LECTURER:

HOANG VAN TUONG

22nd October 2021

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TABLE OF CONTENTS

1. Introduction………………………………………………………2
2. Financial statements……………………………………….4
3. Financial ratios…………………………………………………8
3.1 Liquidity ratios………………………………………………………..8
3.2 Efficiency ratios………………………………………………10
3.3 Leverage ratios………………………………………………11
3.4 Profitability ratios…………………………………………….14

4. Forecast…………………………………………………………...16
5. References………………………………………………………17

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1. Introduction
PNJ Company, formerly known as Jewelry Store, Phu
Nhuan District, was established on April 28, 1988.
Phu Nhuan Jewelry Joint Stock Company is a
Vietnamese joint-stock company. This company
specializes in manufacturing and trading gold, silver,
gemstone jewelry, business gifts, fashion
accessories, souvenirs, watches, buying and selling
gold bars, providing diamond and stone testing
services. precious metals, precious metals, and real

estate business. In 2010, PNJ was ranked 16th by
Plimsoll in the top 500 largest jewelry companies in the world.
Vision: To become Asia's leading company in jewelry making and
retailing beauty products, reaching out to the world.
Mission: PNJ is constantly innovating to bring exquisite products with
real value to honor the beauty of people and life.
Core Values:
1. INTEGRITY FOR PERSONALITY
2. CONTINUOUSLY HOLLOW THE GOAL
3. INTERESTED IN DEVELOPMENT
4. DELICIOUS FOR CUSTOMERS
5. DIFFERENT CREATION PENSION
Over 33 years of establishment and development, PNJ has achieved
many remarkable achievements: being in the Top 500 leading retailers in
the Asia Pacific, Asia Pacific Quality Award, National Brand, Top 500
100 Best Working Environments in Vietnam, Best Working Environments
in Asia, Vietnam HR Awards 2020…
The company's main market share is through traditional retail stores,
which still account for the majority of the market, in addition, the
company also sells products on e-commerce sites such as Shopee,
Lazada, or Genuine website.
The three largest companies in this gold sector include PNJ, DOJI, and
SJC, all with over 20 years of experience. DOJI and SJC are two
competitors, but each side finds its own strengths to develop. But in the
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jewelry segment, PNJ's notable competitor is the one-year-old brand
Precita, which currently has nearly 20 stores.
To be able to develop and grow as it is today, PNJ has been having
strategic projects. PNJ has been implementing the new enterprise
resource planning project - ERP, which was initially started on April 5,
2018, in Ho Chi Minh City with the most important component of the
Digital Transformation strategy. development strategy direction in the
period of 2018 - 2022 and a vision to 2030, in which, building a
technology infrastructure foundation and digitalizing business operations
strategy (Digital Transformation) is an important pillar.
Competitors: The world jewelry industry is already familiar with famous
brands such as Tiffany, Swarovski or Jacobs & Co. As for Vietnam, the
market is "overpopulated" by "emerging" brands such as Shimmer or
FloralPunk. However, these are niche brands and are not highly
competitive. The common point of these types is outsourcing or
importing goods from China or Thailand with pre-defined designs on the
market. Growth in revenue - profit or even growth in business size
compared to the past is hardly a good indicator for understanding future
sustainability. The core problem lies in the difference so that it is difficult
or impossible for competitors in the industry to "imitate". Currently, the
jewelry industry is divided into 3 different segments with low-end, midend and high-end. With thousands of large and small brands, the market
is "saturated with brands" with names like PNJ, Doji, SJC, Bao Tin Minh
Chau, Phu Quy and smaller brands like Shimmer and FloralPunk.
Brands began to compete fiercely in this area, as shown by the rapid
growth of jewelry stores.
There are 3 core factors of a jewelry retail business that help affirm
competitive advantages (1) Production and supply management capacity,
(2) Strong distribution system and (3) Supplier position Supreme. Factor
(1) here includes a modern factory with outstanding capacity and

production and supply management capacity. In addition, factor (1) also
includes the design team and skilled labor. Owning a modern production
line, a design team of 50 members and a force of artisans and jewelers
of more than 1,000 people, every year, PNJ launches more than 4
million products to the market. From gold and silver jewelry to precious
stones and diamonds. The current capacity of PNJ is 5 - 6 tons/year,
only running 50 - 75% of the total supply capacity. With a maximum
capacity of 8 tons/year, PNJ can completely supply to the market an
additional 1.3 - 1.5 million products in the next 1-3 years, bringing the
total supply capacity to over 6 million products/year. In terms of the
entire market, PNJ's supply capacity far exceeds that of competitors in
the same segment, ranking in the Top 10 factories with the largest
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capacity in Asia. This is the foundation for PNJ to reduce production
costs per finished product and overwhelm the supply volume of
competitors before the whole industry "moves" to increase capacity.
Above all, when demand explodes, PNJ can completely increase
capacity to reach the ceiling level or further increase capacity to take the
lead in the industry.
Meanwhile, factor (2) is a core thing when the retail system must be able
to distribute to the widest customers. As of January 2021, PNJ currently
has 339 stores and plans to open another 40-50 stores in the period
2020-2025 as well as expand the e-commerce segment. Broadly
speaking, PNJ's store system is currently much superior to its nearest

competitors, Bao Tin Minh Chau (BTMC) and DOJI. With 200 retail
stores, BTMC is the most potential competitor that can threaten PNJ
right now. However, the market situation was quite clear with BTMC only
having a distribution system from Quang Tri, while PNJ had more than
80% of stores in the South. Further, when jewelry demand in Vietnam
reaches the Asian average, there will be great room for both giants to
increase their market share through strong distribution and supply chains.
Going further, factor (3) is an important factor determining the success or
failure of factors (1) and (2). The relationship between these three
factors is complementary and intimate. Factor (3) focuses on the ability
to control input costs and the ability to determine selling prices. However,
it is not Doji or SJC that is the competitor that puts pressure on PNJ
even though this brand has 13 stores. Unlike Doji or SJC, both PNJ and
Diamond World are focused on innovation and retail promotion.
The concentration of this market is still low, because more than 70% of
the market belongs to small stores. A big piece of cake for two
businesses to exploit, the opportunity will be divided equally if the
business goes in the right direction. If PNJ has a strong advantage in the
system, the retail jewelry firms will be more competitive in price.
According to a survey on fashion consumption habits by Q&Me at the
end of 2017, price is the most important factor in making purchasing
decisions, accounting for 23%. According to a Nielsen study, the group
of young people will reach 40 million people in the next decade and
spend about 100 billion VND per year. Millennials target this customer,
accounting for about 35% of Vietnam's population.

2. Financial statement analysis
Data calculated by the excel file below

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PHUNHUAN JEWELRY JOINTSTOCK COMPANY

As at 31 December

As at 31 December
2018
ASSETS
Currentassets

Cash
Cashequivalents

Held-to-maturity investments

Short-term trade accounts receivables
Short-term prepayments to suppliers
Other short-term receivables
Deficits in assets awaiting solution
Inventories
Inventories
Othershort-termassets
Short-term prepaid expenses
Value added tax deductibles
Taxes & otherreceivables from theStatebudget

Non-currentassets

Other long-term receivables
Fixedassets
Tangible fixed assets
Historical cost
Accumulated depreciation
Intangible fixed assets
Historical cost
Accumulated amortization

Long-term construction in progress

Equity investments in other entities
Provision for long-term investments
Otherlong-termassets
Long-term prepaid expenses
Deferred income taxassets
TOTAL ASSETS

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2019

2017

2018

2019

LIABILITIES & OWNERS' EQUITY
100

3,896,141,901,410

5,405,256,600,641

110

175,208,552,187

206,721,179,629

95,224,439,008

111
112

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

206,721,179,629

95,224,439,008

7,333,364,485,251

-

-

120

160,065,000,000

-

123

160,065,000,000

-

-

130

84,622,464,067

155,196,257,825

129,688,313,476

131
132
136
139

39,946,216,659
33,682,107,963

10,858,761,425
135,378,020

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

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

140

3,401,959,226,624

4,968,145,942,990

7,030,420,371,216

141

3,401,959,226,624

4,968,145,942,990

7,030,420,371,216

150

74,286,658,532

75,193,220,197

78,031,361,551

151
152
153

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

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

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

200

675,158,254,081

1,032,638,955,963

1,269,599,936,565

210

42,787,737,738

57,498,444,869

70,721,623,109

216

42,787,737,738

57,498,444,869

70,721,623,109

220

487,243,774,697

719,287,274,744

923,870,354,474

221
222
223
227
228

229

205,748,326,607
396,615,581,684
(190,867,255,077)
281,495,448,090
286,740,907,873
(5,245,459,783)

225,960,569,846
454,178,423,940
(228,217,854,094)
493,326,704,898
499,937,407,873
(6,610,702,975)

263,827,234,353
534,818,699,342
(270,991,464,989)
660,043,120,121
679,619,883,005
(19,576,762,884)

240

9,665,078,966

70,822,681,154

28,457,398,434

242

9,665,078,966

70,822,681,154

LIABILITIES

300

1,542,697,241,029

2,692,822,128,700

4,025,698,610,469

Current liabilities

310

1,488,758,034,029

2,677,317,785,700

4,017,860,824,469

311
312
313

314
315
319
320
322

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

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

690,808,185,195
95,353,052,369
192,682,671,178
222,296,091,737
45,877,630,688
69,257,739,996

2,610,902,622,222
90,682,831,084

330

53,939,207,000

15,504,343,000

7,837,786,000

337
338
342

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

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

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

OWNERS' EQUITY

400

3,028,602,914,462

3,745,073,427,904

4,577,265,811,347

Capital&reserves

410

3,028,602,914,462

3,745,073,427,904

4,577,265,811,347

411
412
415
418
421
412a
421b

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

233,985,702,026
616,755,123,060

1,670,029,820,000
925,397,862,458
(7,090,000)
265,087,556,918
884,565,278,528
98,780,546,381
785,784,732,147

440

4,571,300,155,491

6,437,895,556,604

Short-term trade accounts payables
Short-term prepayments from customers
Taxes & otherpayables from theState budget
Payables to employees
Short-term accruedexpenses
Other short-term payables
Short-term loans
Bonus & welfare funds
Non-current liabilities
Other long-term payables
Long-term loans
Provision for long-term liabilities

Owners' capital
Share premium
Treasury shares
Investment & development fund
Retained earnings
- Retainedearnings accumulated to the prioryear end
- Retainedearnings of the current year
TOTAL LIABILITIES & OWNERS' EQUITY

28,457,398,434

250

-

-

-

253
254

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

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

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

260

135,461,662,680

185,030,555,196

246,550,560,548

261
262

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

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

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

270

4,571,300,155,491

6,437,895,556,604

8,602,964,421,816

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2,252,935,850,000
968,074,112,458
(2,101,090,000)
313,083,556,918
1,045,273,381,971
29,482,225,528
1,015,791,156,443
8,602,964,421,816


PHUNHUAN JEWELRY JOINTSTOCK COMPANY

Year ended 31 December
2017

Netsales

Grossprofit
Financial income
Financial expenses
Including: Interest expense
Selling expenses
General and administration expenses
Netoperatingprofit(EBIT)
Other income
Other expenses
Resultsofotheractivities

Net income before tax
Business incometax-current
Business incometax-deferred
Net income after tax

14,571,135,744,850
(9,064,872,939,048)

(11,792,052,183,391)

1,911,963,950,916

2,779,083,561,459

8,794,872,100
(56,475,629,564)
(54,981,032,499)
(774,978,169,326)
(187,936,351,549)

6,846,027,091
(66,345,864,211)
(61,109,042,390)
(1,170,069,069,426)
(345,868,153,940)

901,368,672,577

1,203,646,500,973

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

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

6,010,723,280

1,903,772,148

907,379,395,857

1,205,550,273,121

(182,038,883,247)

(249,485,408,708)

(484,064,550)

3,858,482,734

724,856,448,060

959,923,347,147

724,856,448,060

959,923,347,147

Atributable to:

Earningspershare
Diluted earnings pershare

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6,434

6,481

6,434

6,481

0

17,000,681,080,523

2,879,755,229


PHUNHUAN JEWELRY JOINTSTOCK COMPANY
(Indirect method)
Year ended 31 December
2018
1,205,550,273,121
42,101,648,087

(169,041,343)
(7,406,944,577)
61,109,042,390
(86,037,746,014)
(1,566,186,716,366)
412,203,203,546
(44,784,289,702)
(60,443,657,529)
(231,958,086,112)
(26,117,591,079)
(302,139,905,578)

(336,378,415,370)
1,075,665,048
160,065,000,000
6,331,279,529
(168,906,470,793)

97,273,160,000
4,320,772,043,080
(3,647,003,259,254)
(268,371,812,300)
502,670,131,526
31,623,755,155
175,208,552,187
(111,127,713)
206,721,179,629

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3. Financial ratios
3.1 Liquidity ratios
Table of the liquidity ratios of PNJ for the period of 2017-2019
Value

Cash ratio
Current ratio
Quick ratio

2017
0.12
2.62
0.33

with2017

2018
0.08
2.02
0.16

with2018

2019
Absolute(+/-) Absolute(+/-)

0.02
(0.04)
(0.05)
1.83
(0.60)
(0.19)
0.08
(0.17)
(0.09)

Cash ratio is the ratio to measure the amount of money currently available
at the company to cover all short-term liabilities. This ratio immediately
indicates the financial crisis of the company. Calculating by the formula :
Cash ratio =

Cash & cash equivalents
Current liabilities

In 2017, the cash ratio of the firm was 0.12, in 2018 decreased by 0.04 to
0.08 and in 2019 continued to decrease 0.05 to 0.02. This shows that the
company's ability to pay cash is declining.
Current ratio is the ratio to measure the amount of money currently available at
the company to cover all short-term liabilities. The current ratio shows the correlation
between current assets and current liabilities, is a widely used measure. The current
ratio indicates how many short-term assets each company uses for its short-term
debt. Calculating by the formula:
Current ratio =

Current assets
Short -term debt

In 2017, this index was 2.62. By 2018, it has decreased by 0.6 to 2.02. The
year 2019 continued to decrease by 0.19 compared to 2018, to 1.83. The
corporate current ratio in three years, though decreasing, is greater than 1,
proving that the company's short-term assets are capable of paying short-term
debts and this will increase the company's reputation with creditors.
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Quick ratio illustrates the firm's true ability to pay its debts against shortterm debts. However, in reality, many short-term assets have lower liquidity than
inventories, so this ratio is not effective. Calculating by the formula:
Quick ratio =

Curren tassets − Inventories
Short -term debt

The company's quick solvency in 2017 was 0.33 and decreased from 0.17 to
0.17 in 2018. By 2019, this index continues to decrease by 0.09 to only 0.08.
PNJ's LIQUIDITY RATIOS
In three year 2017 - 2018 - 2019
2.8

2.62

2.4
2.02

2

1.83

1.6

1.2

0.8
0.33

0.4

0.16

0.12

0.08

2017

2018

0.08
0.02

0
Cash ratio

2019

Current ratio

Quick ratio

In general, liquidity indices decreased continuously in 2018 and 2019,
showing that the liquidity of PNJ's short-term debts is going down. In particular,
the two ratios of Cash ratio and Quick ratio are very low (below 1), indicating that
enterprises are in a quite dangerous debt situation due to the lack of ability to
meet short-term obligations with The most liquid asset. However, the current ratio
is still kept at steep high (1.83), showing that the company is still in a good
liquidity position due to its large inventory, which is suitable for the characteristics
of its business, jewelry.

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3.2 Efficiency ratios
Table of the efficiency ratios of PNJ for the period of 2017-2019
Value

Inventory turnover
Total assets turnover
Accounts receivable turnover
ay's sales in inventory (days)
Day's sales outstanding (days)

2017
2.66
2.40
274.79
136.98
1.33

with2017

2018
2.37
2.26
252.69
153.78
1.44

with2018

2019
Absolute(+/-) Absolute(+/-)
1.93
(0.29)
(0.45)
1.98
(0.14)
(0.29)
352.03
(22.10)
99.34

189.52
16.80
35.74
1.04
0.12
(0.41)

Inventory turnover indicates the relationship between inventory and cost of
goods sold in a period. Used to evaluate the effectiveness of a company's
inventory management. This index shows the average number of inventory
rotation how many periods to generate revenue. Calculating by the formula:
Inventory turnover =

Revenue
Average inventory

The inventory turnover of the company decreased continuously for over 3 years. In
2017, this index was 2.66 to 2018, down to 2.37 and in 2019 to only 1.93.This shows
that the company is not effectively managing the inventories. Low inventory turnover
causes the costs of inventories to increase, which reduces the company's revenue.
Total assets turnover measures the effectiveness of assets using regardless of
whether they are long-term or short-term assets. This ratio indicates how much
revenue each asset generates. Calculating by the formula:
Total assets turnover =

Revenue
Average of total assets

The total assets turnover of the company decreased gradually over 3 years from
2017 to 2019. In 2017, with a single asset generated 8.52 times of revenue, in 2011, it

was only 7.1 times and in 2012, it was only generated. 2.49 times. This shows that the
company has not used assets effectively and showed signs of weakening.

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Accounts receivable turnover ratio is used to quantify the company's
effectiveness in collecting accounts receivable or debts from customers. The ratio
shows how well a company uses and manages credit to its customers and how
quickly short-term debt is collected or paid off. Calculating by the formula:
Account receivable turnover =

Net sales
Accounts receivable

The company's Day's sales outstanding in 2017 was 1.33 and increased by 0.12
to 1.44 in 2018. By 2019, this index decreased by 0.41 to 1.04. It can be seen that this
index of PNJ has had an unstable change.
Overall, the company's efficiency ratios show that the ability to use the
company's assets to generate income is on the decline. Because efficiency ratio is
important because it is directly related to profitability, PNJ needs to improve the
efficiency of its business operations in order to obtain a better profit.
3.3 Leverage ratios
Table of the leverage ratios of PNJ for the period of 2017-2019
Value

Total debt ratio
Debt-to-equity ratio
Equity multiplier

2017
0.34
0.51
1.51

with2017

2018
0.42
0.72
1.72

with2018

2019
Absolute(+/-) Absolute(+/-)
0.47
0.08
0.05
0.88
0.21
0.16
1.88
0.21
0.16

The total debt ratio is the ratio to measure the extent to which the firm
finances its assets from sources other than the stockholders. The higher the total
debt ratio, the more debt the firm has in its capital structure (Robert, David, &
Thomas, 2011). Calculating by the formula:
Total debt ratio =

Total debt
Total assets

In 2017, the total debt of PNJ was 0.34, in 2018 increased by 0.08 to 0.42
and in 2019 continued to increase by 0.05 to 0.47. In general, PNJ’s total debt

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ratio in 3 years was at the allowed level, not exceeding 0.5, which means that
most of the company’s assets are financed through equity.
The debt-to-equity ratio is the ratio to indicate the relative proportion of the
entity’s equity and debt used to finance an entity’s assets. The debt-to-equity
ratio is one of the important financial ratios and used as a customary for judging
a company’s financial standing. Calculating by the formula:
Debt / Equityratio =

Total debt
Total equity

In 2017, this ratio was 0.51, it means for each VND in equity, the firm has
51 cents in leverage. The index went up by 0.21 from 0.51 to 0.72 and reached a
peak at 0.88 in 2019. Comparing to the industry average, the debt to equity ratio
is not high. This shows that the firm failed to depend upon borrowing for
financial activities.
Equity multiplier is the ratio to show the number of assets that the firm has
for every dollar of equity (Robert, David, & Thomas, 2011). In other words,
equity multiplier is a method of evaluating a company’s ability to use its debt
for financing its assets. Calculating by the formula:
Equity multiplier =

Total assets
Total shareholder equity

Overall, the equity multiplier increased steadily over 3 years. In 2017, this
index was 1.51 and increased by 0.21 to 1.72 in 2018. By 2019, this index
continued to increase by 0.16 to 1.88. The increase of PNJ’s multiplier
indicates that a larger portion of the company’s total assets is derived from
debt.

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PNJ's LEVERAGE RATIOS
In three year 2017 - 2018 - 2019
2

1.88
1.72

1.8
1.6

1.51

1.4
1.2
1

0.88
0.72

0.8
0.6

0.51

0.47

0.42
0.4

0.34

0.2

0
2017

2018
Total debt ratio

2019

Debt-to-Equity ratio

Equity mutiplier

In general, the leverage ratios have increased for 3 years, showing that PNJ
is able to meet its debts. The two indexes of total debt ratio and debt-to-equity
ratio tends to increase but still remain below 1, which shows that PNJ's financial
sustainability over 3 years is quite stable. For equity multiplier, this ratio is kept
at a high level, showing more debt-financed assets than equity. In other words,
PNJ is considered to be more leveraged and riskier for investors and creditors
(when PNJ's assets are mainly financed by debt), which also means that current
investors actually own less of PNJ’s assets than current creditors.

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3.4 Profitability ratios
Table of the profitability ratios of PNJ

for the period of 2017-2019

Value

Gross profit margin
Operating profit margin
Net profit margin
ROA
ROE
EROA

2017
17.42%
8.21%
6.60%
15.86%
23.93%
19.72%

with2017

2018
19.07%
8.26%
6.59%
14.91%
25.63%
18.70%

with2018

2019
Absolute(+/-) Absolute(+/-)
20.36%
1.65%
1.29%
8.86%
0.05%
0.60%
7.02%
-0.02%
0.43%
13.88%
-0.95%
-1.03%
26.08%
1.70%
0.45%
17.51%
-1.02%
-1.19%

Gross profit margin is an indicator used to assess the company's business
model and financial health by revealing the remaining amount from sales after
subtracting the cost of goods sold. Calculating by the formula:
Gross profit margin =

Net sales − Cost of goods sold
Total revenue

This index of PNJ increased by 1.65% between 2017 and 2018; however, it
will only increase by 1.29% in 2019. Profit margins have been reduced.
Operating profit margin indicates how many co-profits can be generated
before taxes and interest. Calculating by the formula:
Operating profit margin =

Operating profit
Total revenue

A high operating profit margin means that cost management is effective
or that revenue increases faster than operating costs. Managers need to find
the reasons for the high or low operating profit so that they can determine
whether the business is operating effectively or if the selling price of
products has increased faster or slower than the cost of capital. The
company's profits increased steadily within 3 years. This proves that
PNJ managers have succeeded in making profits from the operation of the
business.
Net profit margin reflects the net income (after-tax profit) of a business
compared to sales. Calculating by the formula:
Net profit margin =
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Profit after tax
Total revenue

2

0

In 2018, it decreased by 0.02%, it indicates that the enterprise is having
problems hindering the potential profitability due to unnecessary costs,
productivity and management issues. But it increased again in 2019 at 0.43%.
Return on assets (ROA) is an indicator that shows the correlation between
the profitability of a company and its assets. ROA will tell us the effectiveness
of the company in using assets to make a profit. Calculating by the formula:
ROA =

Net income
Total assets

The return on equity (ROE) reflects the net income on equity of
shareholders (or on the tangible net asset value). Calculating by the formula:
ROE =

Net income
Total equity

PNJ's PROFITABILITY RATIOS
In three year 2017 - 2018 - 2019
30.00%

25.00%

Gross profit margin
Operating profit margin
Net profit margin
ROA
ROE

EROA

20.00%

15.00%

10.00%

5.00%

0.00%

2017

2018

2019

Accordingly, in 2019, PNJ recorded net revenue of VND 17,000 billion, up
16.7%, significantly lower than the increase of 2018 and 2017 (respectively
32.7% and 28.2%). However, thanks to the improved gross profit margin, gross
profit growth was higher than net revenue growth, reaching 24.5%, though still

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significantly lower than the previous two years. Financial expenses during the
year increased by 79.1%, while selling expenses increased by 16.5%, and
administrative expenses increased by 38.5%. Vietnam Finance's calculations
show that selling and administrative expenses accounted for 10.8% of PNJ's net
revenue in 2019, a slight increase compared to 2018, and have been increasing
continuously since 2012. At the end of the year, PNJ achieved a profit before tax
of VND 1,502 billion, an increase of 24.6% compared to 2018, although it is
high compared to the common ground but still lower than the increase of 3
years earlier. By the end of December 31, 2019, PNJ's total assets increased by
33.6% compared to the beginning of the year, reaching over VND 8,600 billion.
Notably, inventories increased by 41.3% after one year, accounting for 81.6% of
total assets - the highest according to data from 2012 to present. During the
year, the equity of "jewelry queen" increased by 22.1% to VND 4,574 billion.
Total debt growth (both short-term and long-term) is 66.9%. Debt currently
accounts for 30.4% of PNJ's total capital, while liabilities account for 46.8%.
Return on total assets (ROA) and equity (ROE) are respectively 13.8% (lower
than 2018 and 2017) and 26% (higher than 2018 and 2017).

4. Forecast
Last year, PNJ opened 29 new Gold stores and closed 36 stores (mostly
PNJ Silver) in order to restructure the location of new stores and have better
rental costs. This process makes an important contribution to achieving the
goal of optimizing revenue per store and greatly contributes to the increase in
the proportion of retail revenue, accounting for 59.7% of the company's total
annual revenue. reached the highest level in recent years.
To increase resources, in 2021 PNJ also has a plan to issue 15 million
individual shares, equivalent to 6.6% of outstanding shares. The mobilized
capital is to expand the retail network, increase production capacity, supply and
digital transformation. The amount collected from this issuance can reach
1,500 billion dong.

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So far, with major challenges such as adverse geopolitical events of the
world, the retail industry will begin to slow down, affect trade wars between
major powers, and recently the nCoV epidemic (Covid-19) will have many
negative effects on the global economy and Vietnam.
In that context, the forecast of the firm’s performance in the next 3 years will
still have good growth. Specifically, the company's net revenue is likely to grow
by 12% per year, gross profit is 15%, and profit after tax is about 13%.

5. References
[1] Phu Nhuan Jewelry Joint Stock Company, (2018, March 20). Audited
Consolidated Financial Statements 2017. Retrieved 20 October 2021,
from
/>[2] Phu Nhuan Jewelry Joint Stock Company, (2018, March 15).
Consolidated financial statements for the year ended 31 December 2018.
Retrieved 20 October 2021, from
/>ENGLISH_Signed.pdf
[3] Phu Nhuan Jewelry Joint Stock Company, (2020, March 6). Audited
Consolidated Financial Statements 2019. Retrieved 20 October 2021,
from
/>hat.pdf
[4] Phu Nhuan Jewelry Joint Stock Company, (2018, March 26). Report
of Board of Management Summary of manufacturing – Business

performance in 2017. Retrieved 20 October 2021, from
/>
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