Everpia Vietnam JSC 1st half 2011_ver06.0911

The leverage is very low, 0.3 times Growth plan • Everpia Vietnam has revised the target for sales and NPAT in 2011, supported by significant growth in sales in the 1st half 2011: Sales

EVERPIA VIETNAM JSC. (EVE) 

level. 

Interim  Report 

1st half, 2011 

In the 1st half 2011, Everpia Vietnam  jsc. has achieved the best 

performance ever since  establishment.  This is the first time  company’s BOM decide to revise the  sales and profit target to a higher 

I INTRODUCTION

Listing new shares (Bonus shares + ESOP) 10

Financial Highlights

Preview

• Everpia Vietnam JSC completed the 1st

half 2011 in high note with VND336 billion in sales and VND72.9

billion in NPAT, representing 91.4% and 162.1% yoy

growth respectively The adjusted operating profit

margin showed a strong improvement from 19.3% in

the 1st half 2010 to 27.3% in 2011 The Company

benefited most from operational gearing on the

higher sales

• Significant sales growth is recorded across all key

segments

• Although the gross profit margin was slightly declined

from 40.4% in the 1st half 2010 to 39.6% in the 1st half

2011, EBIT still increased by 170.8% yoy In addition,

thanks to highly positive financial results, NPAT grew

by 162.1% yoy to reach VND72.9 billion

• Current ratio and quick ratio still remained at high

rank with 3.87 and 1.56 respectively The leverage is

very low, 0.3 times

Growth plan

• Everpia Vietnam has revised the target for sales and

NPAT in 2011, supported by significant growth in

sales in the 1st half 2011: Sales target will move from

VND719 billion to VND800 billion and NPAT is

revised upward from VND130 billion to VND160

billion

VND billion 2010E 2011E* % change Revenue 564 800 41.8%

Earnings 102 160 56.9%

Company's plan revised

June 2011

6 months ended June 2010 % change

Financial position at June ended:

130 156

176

336

2008 2009 2010 2011

NET SALES

in 1st half

(in VND billion)

17.8%

26.6%

19.3%

27.3%

2008 2009 2010 2011

OPERATING PROFIT MARGIN

in 1st half

(percent of net sales )

92%

increased

Profit margin 27.3%

Introduction

Name of Company: Everpia Vietnam Joint Stock Company

Established in: 1993

Number of Employees: 1,183

Business scope: Production & Sales of Padding goods and Quilting CMT

Production & Sales of Bedding goods Address: Duong Xa, Gia Lam, Hanoi, Vietnam

Tel: (84-43) 827 6490 Email: info@everpia.vn

Website: www.everpia.vn

Establishment & Development

ESTABLISHMENT

Everpia Vietnam was established in

1993 as a branch of a 100% Korean invested company It became an independent company in 2003 and was converted into a Joint Stock Company

in 2007 In 2010, Everpia Vietnam was officially listed on HOSE with stock code: EVE

Current, over 51% company’s shares belong to Vietnamese investors Shareholders of EVE include renown local and foreigner funds, such as SBI, RRH, FPTC, Agriseco, and BVSC

DEVELOPMENT

Despite starting business with Padding production & sales, EVE’s Bedding business contributed of 72% total revenue in 2010 with the famous brand name EVERON Over the last five years, Everpia Vietnam’s sales increased over 30% per year and NPAT increased over 60% per year

Nowadays, Everpia Vietnam is the biggest bedding and padding company and leads the related markets in both the North and the South of Vietnam

48 52.8 54.8

82.2 107.2 123.3

153.3

229.9

Apr‐2007 Jun‐2007 Oct‐2007 Aug‐2008 Jun‐2009 Jun‐2010 Jul‐2010 Jun‐2011

Charter capital (VND billion)

Brands & Licenses

EVERON: premium bedding brand positioning high price & quality in Vietnam;

has become the most popular bedding brand in Vietnam with more than 400

exclusive agents nationwide, and chosen as one of 500 famous brand names

in Vietnam

ARTEMIS: premium bedding brand which targets consumers with high

incomes

DEXFIL: premium padding brand for high performed low denier padding

goods

DACRON: the best global brand for bedding fillers from INVISTA; offers

down-like luxury products such as pillows, comforters, mattress pads, and toppers

THERMOLITE: The best global padding brand from INVISTA Lightweight

warmth in the widest Range of Apparel, sleeping bags, winter accessories,

shoes hunting wear, and high protective outerwear and adventure gear

ADVANSA: Europe’s polyester leader High performance & well-being

polyester for bedding products

The product life cycle for bedding continues

Product designs, Product collections and Styles

EVE provides products in a variety of designs

to appeal to a broad range of consumer tastes in the different segments EVE’s product design process begins with marketing personnel identifying customer preferences and marketplace trends and conceptualizing product idea A variety of sketches are produced by company designers, from which prototype are made prior to full-scale production EVE believes our distinctive product design, development and market-launch process provides the company with a competitive advantage New styles in each of EVE’s products categories are continually designed and developed annually to replace discontinued products and collections and, if desired, to expand product categories

to shorten as consumers demand innovative new design, color, style, and fabric that will enhance their lifestyle while providing quality and value

Shareholders Structures

Foreign / Local Ratio

Investors Individual Institution Total

Local 5,277,933 34.4% 2,890,905 18.9% 8,168,838 53.3%

Foreign 3,667,578 23.9% 3,491,580 22.8% 7,159,158 46.7%

Total 8,945,511 58.4% 6,382,485 41.6% 15,327,996 100.0%

Shareholder structure

Navigation Local shareholder Foreign shareholder Total

>5% 1,380,000 9.0% 5,397,000 35.2% 6,777,000 44.2%

>1%; <5% 5,765,899 37.6% 1,307,825 8.5% 7,073,724 46.1%

<1% 1,022,939 6.7% 454,333 3.0% 1,477,272 9.6%

Total 8,168,838 53.3% 7,159,158 46.7% 15,327,996 100.0%

List of main shareholders and Ownership

Shareholder No of stock %

Lee Jae Eun 2,484,000 16.2%

Red River Holding 1,913,000 12.5%

Vietnam Japan Fund 1,000,000 6.5%

* Shareholder structure is updated on 4 th July 2011 before additional Bonus Share which is in the process of waiting for listing

20.5%

33.1%

4.7%

18.9%

22.8%

Shareholder Structure

Internal shareholders Individual local Individual foreign  Institutional local Institutional foreign

53.3

%

46.7

%

Local shareholders

Foreign shareholders

Business review

OVERVIEW

Everpia Vietnam is eport excel r

the 1 half 20 rof nd argi

and the exchang

successfully Net sales went up thanks to factors such

nd efficient portfolio products

During the 1st half 2011, EVE’s consolidated net sales

Bedding

o This is nality operation of

P Mar to A ding m Sep to

F

BEDDING BUSINESS

was VND196.6.1 billion, increasing 103.4% yoy Most of

it came from sales of Everon in the Northern area, which

ncrease of 70.3% yoy Everon ales in the South (including exportation) was VND66.4

illion, and increase of 82.9% The increase was due

rily to more orders from customers and the

crease in selling prices in March of bedding line EVE

believes the efficient reorganisation of our sales

epartment has contributed to that growth, which help

ning some market share With these

erformances, Everon still maintains its first position in

e middle section of the Bedding market in Vietnam

ADDING BUSINESS

evenue from Padding business of Everpia Vietnam in

the first half 2011 was VND140.4 billion, an increase of

7.2% yoy A major part (66.8%) of padding revenue

10%

20.36%

12.20%

91.44%

0% 20% 40% 60% 80% 100%

0 50 100 150 2 2 3 350 400

09 010 2011

 in  1st half  Sales

pleased to r lent results fo

st

11 with high p its a operating m ns

ts While inflation was 13.93%, the int rest

ate on ba loans was too

e rate beween

high, ar US

und 22% to

D and VND was

5%, djusted tinuously, Everpia Vietnam still perfo med 00

50 00

as volume sales, price, a

Bedding 58.33%

Padding

41.67%

Sales in 1st half 2011

2008 20 2

Net sales Growth rate

0 20 40 60 80 100 120 140

2008 2009 2010 2011

1st half Bedding sales in

increased 91.4% to VND 366 billion, in which

ccupied 58.3%

adding (from

due to seaso ug) and Bed (fro eb)

n the 1st half 2011, rev ue from the dding

was VND118.6 billion, an i

b

prima

in

0 10 20 30 40 50 60 70 80 90 100

Padding Sales in 1st half

d

us gai

p

th

P

R

7

was from the Padding business in the Northern market

Notable padding sales resulted from increase of padding

2008 2009 2010 2011

ial Status

Financ

prepare for the bedding high

season in the 4th quarter of the

year Compared with a year earlier,

total working capital was up 92%

on the same basis

Due to this seasonal high working

capital in the 2nd quarter, cash and

1 Everpia

Consolidated balance sheets

BALANCE SHEET

Working capital

Working capital rose 9.1%

compared to 31/12/2010 in the first

half due primarily to an increase in

trade account receivables and

inventories, reflecting higher sales

and accelerated production to

cash equivalent was reduced from

VND191 billion as of 31/12/2010 to

VND82 billion as of 30/6/2011

Leverage

During 1st half 201

Vietnam borrowed VND71.2 billion

from banks to finance raw material

purchase Long-term financial debt

is nil, the financial structure of the

company is very sound with

leverage at only 0.3 times

30/06/2011 VND bil.

ASSETS Current Assets

Cash and cash equ Short-term investm Short-term accou

ivalents 36.509 194.842 30.309 ent 45.512

-nt receivables

179.309 84.998 79.853 Inventories 366.792 224.725 187.070 Other short- term assets 20.398 14.447 36.379

648.520 519.012 333.611 Non-current assets

Fixed assets 143.709 139.671 96.391 Long-term investments 1.023 4.023 0.693 Other non-current assets 6.414 6.772 4.968

151.146 150.466 102.053

Total assets 799.666 669.478 435.664 RESOURCE

Current liabilities Non-current liabili

167.368 77.798 83.054

ties 16.176 16.982 0.3

Total liabilities 183.545 94.780 83.056

Shareholders’ equity Chartered capital 229.920 153.280 123.280

tal 7.330 3.502 4.484

186.804 225.796 151.423

615.054 573.578 351.801

Share premium Foreign exchange Other owner’s capi Retained earnings

Minority interest 1.068 1.120 0.806

Total equity and liabilities 799.666 669.478 435.664

5%

6%

0% 1%

Capital St

22%

ructure

46%

Cash and cash equivalents Short‐term investment Short‐term account receivables Inventories

Other short‐ term assets Fixed assets

Long‐term investments Other non‐current assets

atement Consolidated Income St

Item

01/01/2011 01/01/2010

% change

30/06/2011 30/06/2010 VND bil VND bil

8

%

8 88.1%

06 143.8%

4

6

2 0.846 -38.2%

Net profit after tax 72.85

Profit from operati

1 175.914

1 175.534 91.4

9 70.99

6

7 33.929

Profit before tax 92.3

Current income tax

expense

2

0 34.775

3 27.797 162.1%

INCOME STATEMENT

stiff price increase of fibers

by over 30% in 1st half 2011, p

slightly from 39.7% half 20 40.7% 2011 thanks

pricing po ies of Everpia Vietnam and Board of Director’s de on to import raw l in Thu

prof half 201 sed VND133.5 billion D71

1st half 2010

Selling, genera adm

VN lion to 20

resul m high s, and exp for

ex epre nly 15% of revenue compared to 20% in the 1st half 20

As lt, operating pro VND91.9 billion in half 2011, inc 0.8 ed to

e significant oes up by VND84.3 billion in the 1 half 2011 c

the same period of 2010 but in line wit

in current assets by VND314.9 billion, resulting in

gentle decline in the current ratio Although that,

current ratio was still high, at 3.87 times as of

30/06/2011 The quick ratio, increased from 1.33 in

1st half 2010 to 1.56 in 1st half 2011

The company’s return on sale increased to 27.3% in

1st half 2011 compared to 19.3% in 2010, boosted by

the strong performance of the bedding business

department due to a reasonable cost breakdown

policy to ensure profitability from each item

The return stockholder’s equity (ROE) was increased

to 11.8% in 1st half 2011

ancial ratios

Despite the and fabrics the gross rofit margin was moved

in 1st

to the effective

10 to lic

cisi materia advance s, gross

it in 1st 1 increa to

from VN billion in

l

st

half 20

and in

increased

istrative penses fo

D13.9 bil ma

compared ghe

10, due xp rily to r selli enses ting fro

nse

er sale higher e

stomer s

advertisement an ice How

d , SG&A penses r sented o

10

1st reasing 17 % compar 2010

FINANCIAL RATIO

The current and quick ratios show Ev

good capability to meet its short-te

Short term debt was a

st

rpia Vietnam’s

rm obligation

g ompared with

h the increase

Main fin

2011

1 st half 2010 Liquidity ratios

o

Gearing ratios

Profitability ratios

Assets ratios

Non-current assets/ total

Coming events

ROSPECTS

EVE’s business is well spread r ic regions and

Historically, EVE’s sales grow n of the market

urbanization, improved purcha r se consumers

the continuing change in custome stes i signs provid

g nities

placed to maximize and seize the opportu the ts E

d ought a large a bers d o 2010

operating efficiencies have been d E e velop

M re high in the 1 this year and EVE anticipate

i ce in the se lf of ltho rema

i t rate and exchang ovem VE s to

p year and to s r sa ro 2nd

y

NEW TARGET OF SALES AND NPAT

During 1st half 2011, Everpia Vietnam JSC already fulfilled 47% of

e target and 57% of its NPAT target Entering the bedding se

ommonly accounts for 65%of to

hs to achieve V

e e 2011 plan EVE will increase by 41.1%

ill r tax is

complete the of

r

P

across dive se geograph customers

In addition, along with

es further

VE is well

VE acted ) to reduce eased and

th has bee si

well ahead of

ng powe rs’ ta

Vietname

n new de rowth opportu

aving largely pro from the f tuation of put pric

nities in marke ecisively (i.e b mount of fi at the en f year

osts with benefits f the 1st ha 11 as s les have

capture VE hav also de ed a new

which will

s increase ins alert to make good half of this

rand, namely Ede m Southe market, benefi

rogressively come through e 2nd half 1, 2012 a future y

aterial costs we st half of

n fiber and fabrics pri cond ha 2011 A ugh it

nflation, interes e rate m ents, E expect

rogress for the full ee highe les and p fits in the

ear

its annual ason (last revenu

six months) which c

xpects total revenue in the last 6 mont

tal sales of a year, EVE

ND 463 bil

e

Thus, the Board of Everpia Vietnam has decided to incr

now believes that full-year revenue for the Group

compared with 2010 (instead of 26.8%) to VND800 b

revised to VND160billion, 56.4% increase from 2010 NP

EVERPIA VIETNAM’S SHARES PLAN INFORMATION

In the 2nd half of 2011, Everpia Vietnam will list addition

shareholders on 25th May, 2011 and

ase th ion, net profit afte

AT

l bonus shares issued procedure for listing 410,000 shares under the Employee Stock Option Prog

am (ESOP)

Expectations 2011

Previous plan Revised plan

“EVE operates with a stro balance sheet and the N has been increased 164% fostering the Board’s confidence in growth prospects of our powerfu

ng PAT ,

l niche business”