Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated Interim Financial Statements for the six-month period ended 30 June 2012 \ - Bien Hoa Sugar Joint Stock Company and its subsidiary Corporate Information Establishment Decision No. Business Registration Certificate No. Board of Management Board of Directors Registered Office Auditors 44/20 IIIQD-TTg 27 March 200 I 3600495818 16 May 2001 The Company's business registration certificate has been amended several times, the most recent of which is by business registration certificates No. 3600495818 dated I August 2012. The business registration certificate and its updates were issued by the Planning and Investment Department of Dong Nai Province. Ms. Huynh Bich Ngoc Chairwoman (from 20 April 2012 to 2 August 2012) Mr. Thai Van Chuyen Chairman (from 2 August 2012) Ms. Ph am Thi Sum Chairwoman (until 20 April 2012) Mr. Nguyen Xu an Trinh Vice Chairman (until 20 April 2012) Mr. Pham Dinh Manh Thu Vice Chairman Ms. Dang Huynh Uc My Member Mr. Tong Thong Member (from 20 April 2012) Mr. Nguyen Van Loc General Director Mr. Tran Tuu Deputy General Director (from 9 July 2012) Mr. Nguyen Thanh Cuong Deputy General Director (until 27 July 2012) Mr. Bui Van Lang Deputy General Director Mr. Pham Cong Hai Deputy General Director Mr. Nguyen Hoang Tuan Deputy General Director Industrial Zone 1 Bien Hoa City Dong Nai Province Vietnam KPMG Limited Vietnam Bien Hoa Sugar Joint Stock Company and its subsidiary Report of the Board of Management STATEMENT OF THE BOARD OF MANAGEMENT'S RESPONSIBILITY IN RESPECT OF THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS The Board of Management and Board of Directors are responsible for preparing the consolidated interim financial statements of Bien Hoa Sugar Joint Stock Company ("the Company") and its subsidiary (collectively "t he Group") in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and the relevant statutory requirements of each financial period which gives a true and fair view of the state of affairs of the Group and of its results and cash flows for the period. In preparing these financial statements, the Board of Management and Board of Directors are required to: • select suitable accounting pol icies and then apply them consistently; • make judgments and estimates that are reasonable and prudent; • state whether applicable accounting standards have been followed; and • prepare the consolidated interim financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business. The Board of Management and Board of Directors are also responsible for ensuring that proper accounting records are kept which disclose, with reasonable accuracy at any time, the financial information of the Group and to ensure that the accounting records comply with the requirements of Vietnamese Accounting Standards, the Vietnamese Accounting System and the relevant statutory requirements. It is also responsible for safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Board of Management and Board of Directors confirm that they have complied with the above requirements in preparing the consolidated interim financial statements. APPROVAL OF THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS We hereby approve the accompanying consolidated interim financial statements which give a true and fair view of the consolidated financial position of the Group as of 30 June 2012 and of th ~ ~ ated results of operations, changes in equity and cash flows for the six-month period ~~ ; ~ <feU ~ a.ccordance with Vietnamese Accounting Standards, the Vietnamese Accounting ,~ ( t '\ ' 4 ~ "' ~~ m anpthe t'e levant statutory requirements. ~/ ("" ' , 'J \ ' . \ o n:~e~ ' J lf ~f th ~ B ~ ard of Directors 0 ;;:oti cl . ," , .;! ~ " ,r: ~ ~ i" O / : lj " ,,1- (:IIJ • () " :.b'lf' . /- , ~ - v.;; ~ ~ tv lor 0" • ' ~. Mr. Nguyen Van Loc General Director Dong Nai, 27 August 2012 2 KPMG Limited Telephone +84 (8) 3821 9266 10" Floor. Sun Wah Tower Fax +84 (8) 3821 9267 115 Nguyen Hue Street Internet wwwkpmg .com. vn District 1. Ho Chi Minh City The Socialist Republic of Vietnam INDEPENDENT AUDITORS' REPORT ON RESULTS OF CONSOLIDATED INTERIM FINANCIAL STATEMENTS REVIEW To the Shareholders Bien Hoa Sugar Joint Stock Company and its subsidiary Scope We have reviewed the accompanying consolidated balance sheet of Bien Hoa Sugar Joint Stock Company ("the Company") and its subsidiary (collectively "the Group") as of30 June 2012, and the related consolidated statements of income, changes in equity and cash flows for the six- month period then ended and the explanatory notes thereto which were authorised for issue by the Company's management on 27 August 2012 as set out on pages 4 to 53. These consolidated interim financial statements are the responsibility of the Company's management. Our responsibility is to issue a report on these consolidated interim financial statements based on our review. The consolidated financial statements of the Group as of and for the year ended 31 December 2011 were audited by another firm of auditors whose report dated 5 March 2012 expressed an unqualified opinion on these financial statements. Additionally, the consolidated interim financial statements of the Group as of and for the six-month period ended 30 June 20 II were reviewed by another firm of auditors whose report dated 10 August 2011 expressed an unqualified review conclusion on those financial statements. We conducted our review in accordance with Vietnamese Standard on Auditing 910 on Engagements to Review Financial Statements. This standard requires that we plan and perform the review to obtain moderate assurance as to whether the financial statements are free of material misstatement. A review is limited primarily to inquiries of the Group's personnel and analytical procedures applied to financial data and thus provides less assurance than an audit. We have not performed an audit and, accordingly, we do not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated interim financial statements do not give a true and fair view, in all material respect, of the consolidated financial position of the Group as of30 June 2012 and of its consolidated results of operations and its cash flows for the six-month period then ended in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and the relevant statutory requirements applicable to interim financial statements. KPMG Limited Lam Thi goc Hao CPA No. N0866IKTV Ho Chi Minh City, 27 August 2012 KPMG Limned. a V ie tnamese hmited lIabllily company and a me mtx! r i r tm of lhc KPMG networ k. of Independent me mber fir ms affiliated I/ lU h <PMG Interna ti onal Cooper ative ("KPMG Internationa l") . '.J SW I $$ e~ \ !( l V . All ri ghts re served. 3 Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated balance sheet at 30 June 2012 ASSETS Current assets (100 = 110 + 120 + 130 + 140 + 150) Cash and cash equivalents Cash Cash equivalents Accounts receivable Accounts receivable - trade Prepayments to suppliers Other receivables Allowance for doubtful debts Inventories , Inventories Other current assets Short-term prepayments Deductible value added tax Other current assets Long-term assets (200 = 210 + 220 + 240 + 250 + 260) Accounts receivable - long-term Other long-term receivables Fixed assets Tangible fixed assets Cost Accumulated depreciation Intangible fixed assets Cost Accumulated amortisation Construction in progress Code 100 110 1 I 1 J 12 130 131 132 135 139 140 141 150 151 152 158 200 210 218 220 221 222 223 227 228 229 230 Note 5 6 7 6 8 9 10 Form BOla - DNIHN 30/06/2012 31112/2011 VND VND 571,619,716,909 752,872,194,158 38,652,993,172 178,778,249,429 18,652,993,172 16,878,249,429 20,000,000,000 161,900,000,000 304,751,594,820 234,744,313,899 108,477,810,779 47,347,504,711 193,073 ,084,349 190,011,179,869 4,476,605,341 7,540,396,530 (1,275,905,649) (10,154,767,211) 221,556,449,039 333,067,839,753 221,556,449,039 333,067,839,753 6,658,679,878 6,281,791,077 15,600,000 1,246,20 I ,565 4,631,692,020 5,412,478,313 1,634,499,057 518,944,903,180 528,865,023,153 70,804,060,634 58,765,140,846 70,804,060,634 58,765,140,846 403,896,375,002 406,501,374,593 310,493,391,435 201,125,463,345 660,114,331,342 521,794,159,598 (349,620,939,907) (320,668,696,253 ) 11,456,664,924 12,261,509,740 20,440,816,437 20,361,700,982 (8,984,151,513) (8,100,191,242) 81,946,318,643 193,114,401,508 The accompanying notes are an integral part of these consolidated interim finanCial statements 4 Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated balance sheet at 30 June 2012 (continued) Long-term investments Other long-term investments Allowance for diminution in the value of long-term investments Other long-term assets Long-term prepayments Deferred tax assets Other long-term assets Goodwil1 TOT AL ASSETS RESOURCES LIABILITIES (300 = 310 + 330) Current liabilities Short-term borrowings and IiabiIities Accounts payable - trade Advances from customers Taxes payable to State Treasury Payables to employees Accrued expenses Other short-term payables Bonus and welfare fund Long-term liabilities Long-term borrowings and liabilities Provision for severance allowance EQUITY (400 = 410 + 430) Owners' equity Share capital Capital surplus Investment and development funds Financial reserves Retained profits TOT AL RESOURCES (440 = 300 + 400) Code 250 258 260 261 262 268 269 270 300 310 3 11 312 313 314 315 316 319 323 330 334 336 400 410 411 412 417 418 420 440 Note 11 12 13 14 15 16 17 18 19 20 21 22 23 25 25 30/06/2012 VND 9,000,000,000 9,000,000,000 35,244,467,544 11,432,488,519 1,254,305,0 I 0 5,652,450,000 16,905,224,015 Form BOla - DNIHN 31/1212011 VND 30,775,710,000 50,239,70 I ,076 (19,463,991,076) 32,822,797,714 7,920,159,075 1,254,305,0 I 0 5,652,450,000 17,995,883,629 1,090,564,620,089 1,281,737,217,311 547,641,997,627 433,111,233,345 297,633,101,646 59,349,838,697 1,763,233,503 9,791,890,757 10,418,220,202 23,294,183,054 19,883,815,299 10,976,950,187 114,530,764,282 113,697,161,832 833,602,450 542,922,622,462 542,922,622,462 299,975,800,000 39,817,240,000 87,752,273,950 25,241,483,303 90,135,825,209 733,238,203,768 628,124,819,122 361,712,095,401 81,093,001,599 131,773,602,991 16,726,524,877 1,938,277,345 4,828,609,292 13 ,960,3 80,260 16,092,327,357 105,113,384,646 104,338,661,817 774,722,829 548,499,013,543 548,499,013,543 299,975,800,000 39,817,240,000 65,413,962,846 17,795,379,602 125,496,631,095 1,090,564,620,089 1,281,737,217,311 The accompanying notes are an integral part oj these consolidated interim financial statements 5 Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated balance sheet at 30 June 2012 (continued) OFF BALANCE SHEET ITEMS 30/06/2012 VND Materials and goods held for third parties I, I 06,677,022 Bad debts written off 10,896,024,834 Foreign currencies • USD 114,615,658 • EUR 7,110,632 Prepared by: Form B 01a - DNIHN 31112/2011 VND 378,751,390 2,339,968,982 264,169,457 7,110,632 Vo Cong Minh Nguyen Van Loc Chief Accountant General Director 27 August 2012 The accompanying notes are an integral part of these consolidated interim financial statements 6 Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated statement of income for the six-month period ended 30 June 2012 Form B 02a - DNIHN Six-month period Six-month period from 1/1/2012 to from 1/1/2011 to Code Note 30/6/2012 30/6/2011 VND VND Total revenue 01 26 1,383,474,726,241 1,108,653,236,733 Less revenue deductions 02 (800,943,207) (640,377,482) Net revenue (10 = 01 - 02) 10 1,382,673,783,034 1,108,012,859,251 Cost of sales 11 27 (1,285,628,830,419) (982,225,332,971 ) Gross profit (20 = 10 - 11) 20 97,044,952,615 125,787,526,280 Financial income 21 28 19,027,409,092 15,629,444,060 Financial expenses 22 29 ( 13,446,218,432) (55,532,684,149) In which: Interest expenses (J 5,263,029, 754) (46,342,400,661) Selling expenses 24 (33,261,237,961 ) (15,451,198,590) General and administration expenses 25 (18,004,068,735) (23,118,984,999) Net operating profit 30 51,360,836,579 47,314,102,602 {30 = 20 + (21 - 22) - (24 + 25)} Other income 31 433,899,107 63,795,748 Other expenses 32 (513,319,621) (3,600,000) Results of other activities 40 (79,420,514) 60,195,748 (40=31-32) Profit before tax (50 = 30 + 40 + 41) 50 51,281,416,065 47,374,298,350 Income tax expense - current 51 30 (6,869,310,485) ( 4,846,622,353) Income tax benefit - deferred Net profit 60 44,412,105,580 42,527,675,997 (60 = 50 - 51 - 52) The accompanying notes are an integral part of these consolidated interim financial statements 7 Bien Hoa Sugar Joint Stock Company Statement of income for the six-month period ended 30 June 2011 (continued) Code Note Attributable to: Equity holders of the Company Earnings per share Basic earnings per share 62 70 31 Prepared by: Six-month period from 11112012 to 30/6/2012 VND 44,412,105,580 1,481 Form B 02a - DNIHN Six-month period from 11112011 to 30/6/2011 VND 42,527,675,997 1,418 27 August 2012 The accompanying notes are an integral part of these consolidated interimjinancial statements 8 Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated statement of changes in equity for the six-month period ended 30 June 2012 Form B 09a - DNIHN Investment and Financial Other equity Total owners' Share capital Capital surplus development funds reserves funds Retained profits equity VND VND VND VND VND VND VND Balance at 1 January 2011 185,316,200,000 154,476,840,000 43,083,053,253 10,351,743,071 103,446,818,448 496,674,654,772 Net profit for the period 42,527,675,997 42,527,675,997 Dividends (Note 24) (27,797,430,000) (27,797,430,000) Appropriation to bonus and welfare fund (Note 20) (13,407,140,723) (13,407,140,723) Appropriation to equity funds 22,330,909,593 7,443,636,531 3,541,026,295 (33,315,572,419) Utilisation of funds (3,541,026,295) (3,541,026,295) Balance at 30 June 2011 185,316,200,000 154,476,840,000 65,413,962,846 17,795,379,602 71,454,351,303 494,456,733,751 Balance at 1 January 2012 299,975,800,000 39,817,240,000 65,413,962,846 17,795,379,602 125,496,63 1,095 548,499,013,543 Net profit for the period 44,412, I 05,580 44,412,105,580 Dividends (Note 24) (44,996,370,000) (44,996,3 70,000) Appropriation to bonus and welfare fund (Note 20) ( 4,270,648,883) (4,270,648,883) Appropriation to equity funds 22,338,311, I 04 7,446,103,70 I 721,477,778 (30,505,892,583) Utilisation of funds (721,477,778) (721,477,778) Balance at 30 June 2012 299,975,800,000 39,817,240,000 87,752,273,950 2$ :2 4 1' A8J.3J)3 " "' , . .\ 90,135,825,209 542,922,622,462 Prepared by: : o CongMmh Chief Accountant 27 August 2012 The accompanying notes are an integral part of these consolidated interim financial statements Q [...]... financial statements 12 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012 Form B 09a - DNIHN These notes form an integral part of and should be read in conjunction with the accompanying consolidated interim financial statements 1 Reporting Entity Bien Hoa Sugar Joint Stock Company ( "the Company" ) is a joint- stock. .. (233,103,428,982) The accompanying notes are an integral part ofthese consolidated interim financial statements 10 Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated statement of cash flows for the six- month period ended 30 June 2012 Indirect method (continued) Form B 03a - DNIHN Code Note Six- month period from 111 12012 to 30/ 6 /2012 VND Six- month period from 11112011 to 30/ 6/2011 VND CASH... during the period were as follows: Six- month period from 111 12012 to 30/ 6 /2012 VND Six- month period from 11112011 to 30/ 6/2011 VND Opening balance Disposals 50,239,70 I ,076 (41,239,701,076) 48,358,701,076 Closing balance 9,000,000,000 48,358,701,076 30 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012. .. 4, Ho Chi Minh City As at 30 June 2012, the Group had 975 employees (31 December 2011: 1,056 employees) 13 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012 (continued) Form B 09a - DNIHN 2 Basis of preparation (a) Statement of compliance The consolidated interim financial statements have been prepared... in one business segment, which is in producing and trading sugar and sugar related by-products and in one geographical segment, which is in Vietnam 22 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012 Form B 09a - DNIHN 5 Cash and cash equivalents 30/ 06 /2012 VND 3111212011 VND 329,116,426 18,323,876,746... (481,759,073) At 30 June 2012 trade receivables with a carrying value of VNDI05,772 million and USD129,400 (31112/2011: VNDI,493 million) were pledged with banks as security for loans granted to the Group 24 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012 Form B 09a - DNIHN 7 Inventories 30/ 06 /2012 VND... respect of equity accounted investees, the carrying amount of goodwill is included in the carrying amount of the investment (m) Trade and other payables Trade and other payables are stated at their cost 17 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012 (continued) Form B 09a ­ DNIHN (n) Provisions A... welfare to the Group's staff Payments from bonus and welfare funds are not charged to consolidated statement of income 18 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012 (continued) Form B 09a - DNIHN (p) Classification of financial instruments Solely for the purpose of providing disclosures about the. .. of the period 60 178,778,249,429 58,758,932,992 Cash and cash equivalents at the end of the period (70 = 50 + 60 + 61) 70 38,652,993,172 51,607,512,126 5 (7,151,420,866) The accompanying notes are an integral part ofthese consolidated interim finanCial statements II Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated statement of cash flows for the six- month period ended 30 June 2012 ... Unrealised gains and losses arising from transactions with equity accounted investees are eliminated against the investment to the extent of the Group's interest in the investee 14 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012 (continued) Form B 09a - DNIHN (b) Foreign currency Monetary assets and liabilities . Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated Interim Financial Statements for the six- month period ended 30 June 2012 - Bien Hoa Sugar Joint Stock Company and. 17 Bien Hoa Sugar Joint Stock Company and its subsidiary Notes to the consolidated interim financial statements for the six- month period ended 30 June 2012 (continued) Form B 09a. of these consolidated interim financial statements 6 Bien Hoa Sugar Joint Stock Company and its subsidiary Consolidated statement of income for the six- month period ended 30