Financial Performance - In 2022, the company's revenue reached $132.9 million, a 43% increase from $93.0 million in 2021[8] - The gross profit for 2022 was $13.6 million, compared to $5.9 million in 2021, reflecting a significant improvement[8] - The company's revenue for the year ended December 31, 2022, was $132.9 million, an increase of $39.9 million or 42.9% from $93.0 million in the previous year[18] - Domestic sales in Vietnam contributed approximately 29.6% of total revenue, up from 27.4% in the previous year, with domestic revenue increasing by 54.1% to $39.3 million[18] - Export sales revenue rose by 38.7% to $93.6 million, compared to $67.5 million in the previous year[18] - The company's gross profit for the year was approximately $13.6 million, with a gross margin of 10.2%, an increase of 3.9 percentage points from the previous year[20] - The company recorded an operating profit of $0.6 million for the year, a significant improvement from an operating loss of $6.6 million in the previous year[25] - The net loss for the year decreased by 96.4% to $0.2 million, down from $5.6 million in the previous year, resulting in a net loss margin of 0.2%[28] Sales and Market Expansion - The company sold approximately 45.4 thousand motorcycles in Vietnam in 2022, marking a 61.7% increase compared to the previous year[14] - The introduction of new stylish scooters and national motorcycles in 2022 contributed to the sales growth, targeting consumer preferences during peak demand seasons[14] - The company exported approximately 64.0 thousand scooters and national cars to ASEAN countries in 2022, an increase of 36.1% compared to the previous year[15] - The company plans to continue expanding its market presence beyond ASEAN countries, including Greece, Dubai, and Colombia, while enhancing relationships with existing customers[15] - The company plans to launch several new or revamped motorcycle models in the Vietnamese and ASEAN markets in 2023 to enhance product diversification and profitability[42] Financial Position and Assets - Total assets increased to $127.0 million in 2022 from $113.7 million in 2021, while total liabilities rose to $76.1 million from $61.1 million[8] - As of December 31, 2022, the group's net current assets amounted to $44.3 million, a decrease from $45.5 million in the previous year[29] - The group's total current assets were $118.1 million, up from $105.9 million year-on-year, while current liabilities increased to $73.8 million from $60.4 million[29] - The debt ratio as of December 31, 2022, was 79.0%, compared to 69.0% the previous year, indicating a significant increase in leverage[29] - The total cash and bank deposits amounted to $55.3 million, including $47.9 million in Vietnamese Dong, $6.9 million in USD, and $0.5 million in TWD[29] Governance and Compliance - The company established a nomination committee on January 19, 2022, to comply with the revised listing rules, correcting previous deviations from the corporate governance code[55] - The board held 11 meetings and 2 shareholder meetings during the year ended December 31, 2022, with all directors actively participating[61] - The company has adopted a remuneration committee to ensure a formal and transparent process for determining the remuneration policies for directors and senior management[67] - The board consists of a balanced mix of executive and non-executive directors, ensuring effective oversight of the company's operations[57] - The company has confirmed the independence of all current independent non-executive directors, in compliance with listing rules[64] - The chairman and CEO roles are held by different individuals, promoting a balance of power within the board and management[62] - The company has a clear mechanism for risk management and has established policies aligned with its strategic objectives[59] - The board is responsible for setting the company's goals, strategies, and policies, as well as monitoring operational and financial performance[59] - The company has complied with the standards of conduct for securities trading by its directors throughout the year[56] Employee and Social Responsibility - The total salary and related costs for the year ended December 31, 2022, were approximately $12.1 million, an increase from $11.2 million in the previous year, with a workforce of 1,155 employees[40] - The company emphasizes employee training and development, particularly for management and key personnel[137] - The company made approximately $6,600 in charitable donations during the year ended December 31, 2022[139] - The company is committed to providing superior wages and benefits to maintain harmonious labor relations amid rising labor awareness in Vietnam[184] Risk Management and Quality Control - The company has identified significant risks in the Vietnamese motorcycle industry due to market changes and increased competition[155] - The company has established a comprehensive internal audit system to prevent corruption and fraud, with no significant violations reported for the year[198] - The group implements a strict quality management system, adhering to the "three no principles" of not accepting, producing, or releasing defective products[190] - The company conducts weekly meetings to address significant quality issues and develop improvement plans to ensure product quality compliance[188] - No customer complaints were received this year, indicating strong customer satisfaction and effective communication[191] Environmental, Social, and Governance (ESG) Initiatives - The company is committed to promoting environmental sustainability and high standards of corporate governance, encouraging employee participation in social activities[166] - The company has established an ESG governance framework to enhance its ESG management efforts[172] - The company aims to expand the reporting scope of environmental KPIs to better reflect its ESG performance in the future[171] - The company is actively expanding into rural and overseas markets while developing environmentally friendly and electric vehicle options to meet consumer demand[185] - The company has identified climate-related risks, including extreme weather events and stricter air pollution standards, which may increase production and operational costs[184]

Financial Performance - Total revenue for the nine months ended September 30, 2022, was $95.9 million, an increase of 39% compared to $69.0 million in the same period of 2021[2] - Gross profit for the same period was $9.1 million, up from $4.8 million, reflecting a significant improvement in profitability[2] - The company reported a net loss after tax of $0.6 million, a reduction of 83% from a net loss of $3.6 million in the previous year[2] - Operating cash flow for the nine months was $3.5 million, compared to a cash outflow of $4.1 million in the same period last year, indicating a positive shift in cash generation[22] - The company reported a significant increase in other income to $0.8 million from $0.2 million, indicating improved operational efficiency[5] Balance Sheet - Total assets as of September 30, 2022, amounted to $110.8 million, an increase from $105.9 million at the end of 2021[18] - Current liabilities increased to $67.7 million from $60.4 million, primarily due to higher trade and other payables[18] - The company’s cash and cash equivalents at the end of the period were $13.4 million, up from $10.0 million at the beginning of the period[22] - The company’s equity attributable to shareholders decreased to $49.9 million from $52.6 million, reflecting the impact of the net loss[20] Strategic Focus - The company plans to focus on expanding its market presence and enhancing product offerings in the upcoming quarters[2]

Sales Performance - The group's total sales volume in Vietnam for the six months ended June 30, 2022, was approximately 18.6 thousand units, a decrease of 6% compared to the same period last year[8]. - Revenue for the six months ended June 30, 2022, was $62.2 million, an increase of 3.7% from $60.0 million for the same period in 2021[9]. - The group exported approximately 31.3 thousand units of scooters and national motorcycles to ASEAN countries, an increase of 5% compared to the same period last year[8]. - Revenue from motorcycle sales was $55,732,411, while spare parts and engine sales generated $6,459,240, and mold and maintenance services contributed $13,136[65]. - The revenue distribution by region showed that Thailand contributed $24,226,319, an increase from $22,591,753 in 2021, reflecting a growth of about 7.2%[64]. Profitability - The group recorded a net profit of $0.3 million for the six months ended June 30, 2022, improving from a net loss of $1.2 million in the same period last year[9]. - The gross profit for the six months ended June 30, 2022, was approximately $5.7 million, with a gross margin of 9.1%, compared to $5.4 million and 9.0% for the same period in 2021[13]. - Net profit for the six months ended June 30, 2022, was $0.3 million, an improvement of $1.5 million compared to a net loss of $1.2 million for the six months ended June 30, 2021, resulting in a net profit margin of 0.6%[19]. - The company reported a pre-tax profit of $350,198 for the six months ended June 30, 2022, compared to a pre-tax loss of $1,204,651 in the same period of 2021[66]. - The company reported a total comprehensive income of $(469,355) for the six months ended June 30, 2022, compared to a loss of $(5,568,543) in the previous year, indicating a recovery trend[57]. Expenses and Costs - Sales cost increased by 3.7% to $56.5 million for the six months ended June 30, 2022, compared to $54.5 million for the same period in 2021[12]. - Distribution expenses decreased by 9.1% from $3.3 million for the six months ended June 30, 2021, to $3.0 million for the six months ended June 30, 2022[14]. - Administrative and other operating expenses decreased by 8.6% from $3.5 million for the six months ended June 30, 2021, to $3.2 million for the six months ended June 30, 2022, accounting for 5.2% of total revenue[15]. - Employee costs decreased to $5,236,086 in 2022 from $5,893,498 in 2021, indicating a reduction of approximately 11.1%[67]. - Research and development expenses were $630,994 for the six months ended June 30, 2022, down from $813,607 in 2021, a decrease of about 22.4%[68]. Financial Position - As of June 30, 2022, the company's current assets were $114.4 million, with current liabilities of $69.0 million, resulting in a net current asset value of $45.4 million[20]. - The debt ratio increased to 79.1% as of June 30, 2022, compared to 68.6% as of December 31, 2021[20]. - Total assets as of June 30, 2022, amounted to $114,368,892, up from $105,887,447 as of December 31, 2021, reflecting an increase of approximately 8.3%[51]. - The company’s total liabilities decreased from $47,168,309 as of December 31, 2021, to $42,004,308 as of June 30, 2022, indicating a reduction of approximately 10.5%[58]. - The company’s accumulated losses were reported at $(27,849,395) as of June 30, 2022, a decrease from $(28,195,626) as of December 31, 2021, reflecting a reduction in losses[57]. Strategic Initiatives - The group aims to stabilize production and operations while actively seeking sustainable development opportunities amid rising inflation and supply chain challenges[7]. - The company plans to focus on the Vietnamese student market and enhance product design and core technology development in the second half of 2022[27]. - The company aims to expand sales and maintenance service points to improve customer service for its products[27]. - The company will actively participate in market promotion and strengthen overseas after-sales service support in ASEAN countries[27]. - The company continues to focus on expanding its motorcycle-related business and services, with ongoing investments in product development and market expansion strategies[59]. Cash Flow and Financing - The net cash flow from operating activities for the six months ended June 30, 2022, was $1,466,624, a significant improvement compared to a net cash outflow of $(7,977,919) for the same period in 2021[58]. - Cash and cash equivalents increased by $4,286,723 during the six months ended June 30, 2022, compared to a decrease of $(9,898,265) in the same period of 2021[58]. - The company’s financing activities generated a net cash inflow of $4,808,730 for the six months ended June 30, 2022, compared to $7,248,960 in the same period of 2021[58]. - The net proceeds from the IPO amount to approximately $76.7 million, with $58.0 million already utilized and $18.7 million remaining[30]. - The company has allocated $11.7 million for the establishment of a research and development center in Vietnam[30]. Compliance and Governance - The company has complied with the corporate governance code, with the establishment of a nomination committee on January 19, 2022[38]. - All directors have confirmed compliance with the standard code of conduct for securities trading as of June 30, 2022[39]. - The company maintained sufficient public float as per listing rules, ensuring compliance with regulatory requirements[40]. Related Party Transactions - Sales of finished products and spare parts to the ultimate holding company amounted to $56,689 for the six months ended June 30, 2022, down from $67,598 in the previous year[81]. - Purchases of raw materials and finished products from the ultimate holding company totaled $2,388,945, a decrease from $3,304,727 in the prior year[81]. - The total amount of receivables from related parties as of June 30, 2022, was $37,646, a significant decrease from $583,189 as of December 31, 2021[82]. - Trade payables to the ultimate holding company increased to $1,329,111 as of June 30, 2022, compared to $669,936 at the end of the previous year[82]. - Total trade payables to related parties reached $12,752,506 as of June 30, 2022, up from $11,961,731 as of December 31, 2021[82].

Revenue and Profit - Total revenue for the three months ended March 31, 2022, was $28.13 million, a decrease of 4.48% from $29.45 million in the same period of 2021[2] - Gross profit for the same period was $2.45 million, slightly up from $2.44 million year-on-year, indicating a marginal increase of 0.41%[2] - The net profit after tax for the three months ended March 31, 2022, was $0.53 million, a significant improvement from a loss of $0.82 million in the previous year, representing a turnaround of $1.35 million[2] - The company reported a comprehensive income of $0.69 million for the three months ended March 31, 2022, compared to a loss of $(0.42) million in the same period of 2021[12] Cash Flow and Assets - Operating cash flow for the three months was negative at $(1.11) million, an improvement compared to $(5.25) million in the same period last year[24] - Total assets as of March 31, 2022, amounted to $107.59 million, an increase from $105.89 million as of December 31, 2021[20] - Current liabilities were $61.50 million, slightly up from $60.42 million at the end of the previous year[20] - Cash and cash equivalents at the end of the period were $9.57 million, down from $10.27 million at the end of the previous year[24] Equity and Financing - The company’s equity attributable to owners was $53.28 million as of March 31, 2022, compared to $52.59 million at the end of the previous year[22] - The company’s financing income increased to $1.24 million from $0.75 million year-on-year, reflecting a growth of 66.67%[5]

Financial Performance - In 2021, the company reported revenue of $93.0 million, an increase of 10.5% compared to $84.1 million in 2020[8] - The gross profit for 2021 was $5.9 million, down from $8.1 million in 2020, indicating a decline of 27.2%[8] - The company experienced an operating loss of $6.6 million in 2021, compared to an operating loss of $4.9 million in 2020[8] - The net loss for the year ended December 31, 2021, was $5.6 million, an improvement from a net loss of $7.3 million the previous year[24] - The net loss decreased by 23.3% from $7.3 million for the year ended December 31, 2020, to a net loss of $5.6 million for the year ended December 31, 2021, with a net loss ratio reduction from 8.7% to 6.0%[40] - The group’s operating loss increased by 34.7% from $4.9 million for the year ended December 31, 2020, to a loss of $6.6 million for the year ended December 31, 2021[35] Assets and Liabilities - Total assets increased to $113.7 million in 2021 from $107.2 million in 2020, reflecting a growth of 4.7%[8] - Total liabilities rose to $61.1 million in 2021, up from $49.7 million in 2020, marking an increase of 23.0%[8] - The net asset value decreased to $52.6 million in 2021 from $57.5 million in 2020, a decline of 8.5%[8] - As of December 31, 2021, the group's current assets amounted to $105.9 million, up from $99.3 million as of December 31, 2020, while current liabilities increased to $60.4 million from $49.0 million[41] Sales and Market Performance - The company faced a 8.1% decline in motorcycle sales in Vietnam, with total sales of 2,492,372 units in 2021[17] - The total sales volume in Vietnam for the year ended December 31, 2021, was approximately 28.1 thousand units, a decrease of 38.9% compared to the previous year[19] - Domestic sales in Vietnam contributed approximately 27.4% of total revenue, down from 44.9% the previous year, with domestic sales decreasing by 32.4% to $25.5 million[26] - Export sales increased by 45.5% to $67.5 million for the year ended December 31, 2021, compared to $46.4 million the previous year[26] Cost and Expenses - Selling costs increased by 14.7% to $87.2 million, resulting in a selling cost ratio of 93.7%, up from 90.4% the previous year[27] - Distribution expenses rose by 10.6% to $5.2 million, primarily due to increased international shipping and packaging costs[32] - Administrative and other operating expenses decreased by 11.4% to $7.0 million, representing 7.6% of total revenue[34] Corporate Governance - The company has established a nomination committee as of January 19, 2022, to comply with corporate governance codes[67] - The company has a balanced composition of executive and non-executive directors, ensuring effective oversight of business operations[69] - The company’s Chairman and CEO roles are held by different individuals, promoting a balance of power within the board[80] - The company confirmed the independence of all current independent non-executive directors as per the listing rules[82] - The company has established three board committees: Audit Committee, Remuneration Committee, and Nomination Committee, with defined responsibilities[83] Risk Management - The company confirmed that its risk management and internal control systems were effective and sufficient as of December 31, 2021[104] - The board is responsible for evaluating the nature and extent of risks the company is willing to accept to achieve its strategic business objectives[104] - The company management is tasked with establishing, executing, reviewing, and assessing a robust internal control system as part of its risk management framework[105] Future Plans and Investments - The group plans to launch several new or revamped motorcycle models in the Vietnamese and ASEAN markets in 2022, including scooters, national vehicles, and electric vehicles[53] - The group aims to enhance product diversification and profitability by increasing the proportion of high-margin products and reducing low-margin items[54] - The company is investing in new technology development, allocating approximately $2 million for R&D initiatives[130] - The company is considering strategic acquisitions to enhance its market position, with a budget of $5 million earmarked for potential deals[130] Shareholder Relations - The board emphasizes the importance of clear and timely communication with shareholders and investors to build confidence and attract new investments[118] - The company maintains high transparency to ensure accurate and timely information is available to investors through various reports and announcements[118] - Shareholders holding at least 10% of the paid-up capital can request a special general meeting within two months of submission[120] Compliance and Legal Matters - The company has no significant legal or regulatory violations affecting its business as of December 31, 2021[156] - The company has complied with the disclosure requirements of the Listing Rules regarding continuing connected transactions[179] Charitable Contributions - The group made charitable contributions totaling approximately $69,400 during the year ended December 31, 2021[155]

| --- | --- | --- | |-------|-------|-------| | | | | | | | | 中期報告2021 | --- | --- | --- | --- | |------------------------------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 目 錄 | | | | | 公司資料 2 | | | | | 管理層討論及分析 3 | | | | | 其他事項 11 | | | | | 獨立核數師審閱報告 16 | | | | | 綜合損益及其他全面收益表 17 | | | | | 綜合財務狀況表 19 | | | | | 綜合權益變動表 21 | | | | | 簡明綜合現金流量表 22 | | | | | | | | | 未經審核中期財務報告附註 23 二零二一年中期報告 02 | --- | --- | |-------------------------------------------------- ...

VMEPH Annual Report 2020 年報 Vietnam Manufacturing and Export Processing (Holdings) Limited Vietnam Manufacturing and Export Processing (Holdings) Limited 越南製 造加工出口(控股)有限公司 (Stock Code: 422) (Incorporated in the Cayman Islands with limited liability) 越南製造加工出口(控股)有限公司 REPORT2020 ANNUAL Vietnam Vietnam Manufacturing and Export Processing (Holdings) Limited 越南製 造加工出口(控股)有限公司 （股份代號:422） （於開曼群島註冊成立之有限公司） 年報 2020 1 目錄 公司資料 2 財務概要 3 管理層討論及分析 4 企業管治報告 10 董事及高級管理人員簡介 16 董事會報告 18 環境、社會及管治報告 25 獨立核數師報告 36 綜合損益及其他全面收益表 ...

VMEPH Vietnam Manufacturing and Export Processing (Holdings) Limited 越南製 造加工出口(控股)有限公司 (Stock Code: 422) (Incorporated in the Cayman Islands with limited liability) 2020 越南製 （於開曼群島註冊成立之有限公司） （股份代號:422） Vietnam Manufacturing and Export Processing (Holdings) Limited 造加工出口(控股)有限公司 中期報告 INTERIM REPORT 2020 綜合財務狀況表 18 綜合權益變動表 20 目 錄 公司資料 2 管理層討論及分析 3 其他事項 11 獨立核數師審閱報告 15 綜合損益及其他全面收益表 16 簡明綜合現金流量表 21 未經審核中期財務報告附註 22 二零二零年中期報告 02 | --- | --- | |-------------------------------------|-------------------------------- ...

[Company Information](index=2&type=section&id=Company%20Information) This report details the company's core information, including board members, committee structures, legal advisors, registered office, principal place of business, and share registrar - This report comprehensively lists the company's core information, including its board members, committee compositions, legal advisors, registered office, principal place of business, and share registrar[4](index=4&type=chunk) [Financial Summary](index=3&type=section&id=Financial%20Summary) In 2019, the company's revenue rebounded to **$99.5 million**, gross profit turned positive at **$5.4 million**, and losses significantly narrowed, though total assets and net assets continued to decline, with the equity-to-debt ratio rising to **43%** - In 2019, the company's revenue recovered to **$99.5 million**, and gross profit turned positive to **$5.4 million** from a negative figure, with operating and pre-tax losses significantly narrowing compared to 2018[6](index=6&type=chunk) - However, the company's total assets and net assets continued to decline, and the equity-to-debt ratio significantly increased to **43%**[6](index=6&type=chunk) Past Five Years Consolidated Results and Balance Sheet Summary (Million USD) | Indicator | 2019 | 2018 | 2017 | 2016 | 2015 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Performance** | | | | | | | Revenue | 99.5 | 91.5 | 93.7 | 133.2 | 125.7 | | Gross Profit / (Loss) | 5.4 | (2.3) | 6.1 | 15.7 | 9.1 | | Loss Before Tax | (17.6) | (40.5) | (9.8) | (0.8) | (7.8) | | Loss Attributable to Equity Holders | (17.6) | (41.8) | (9.3) | (0.7) | (8.0) | | Loss Per Share (USD) | (0.020) | (0.050) | (0.010) | (0.001) | (0.009) | | **Assets and Liabilities** | | | | | | | Total Assets | 109.2 | 115.2 | 161.7 | 178.0 | 177.3 | | Total Liabilities | 44.7 | 33.1 | 35.9 | 43.4 | 41.0 | | Net Assets | 64.6 | 82.1 | 125.8 | 134.6 | 136.3 | | Current Ratio (times) | 2.3 | 3.3 | 3.9 | 3.5 | 3.7 | | Equity-to-Debt Ratio (%) | 43 | 23 | 19 | 19 | 18 | [Management Discussion and Analysis](index=4&type=section&id=Management%20Discussion%20and%20Analysis) [Business Overview and Operating Environment](index=4&type=section&id=Business%20Overview%20and%20Operating%20Environment) The Group is a leading scooter and moped manufacturer in Vietnam, operating under the SYM brand with an annual production capacity of **200,000** units, facing a saturated market, declining sales for major foreign players, and challenges from environmental policies and automotive substitution, holding a **1.87%** market share as the third-largest player - The Group is one of Vietnam's leading motorcycle manufacturers, operating under the SYM brand with an annual production capacity of **200,000** units[11](index=11&type=chunk) - The Vietnamese motorcycle market has gradually entered a saturation phase, with total sales for the top five foreign direct investment manufacturers decreasing by **3.87%** in 2019[12](index=12&type=chunk) - The Group ranks third in the Vietnamese market, behind Honda and Yamaha, with a market share of **1.87%** in 2019[13](index=13&type=chunk) [Business Review](index=4&type=section&id=Business%20Review) In 2019, the Group faced challenges including slower sales growth, production inefficiencies, and increased relocation costs, with Vietnam sales growing **3.6%** to **63,400** units while ASEAN exports declined **18.3%** to **54,000** units due to competition, leading the Group to prioritize profitability, launch new models, and engage in OEM cooperation - The Group's production facilities in Bien Hoa City, Dong Nai Province, were relocated to Nhon Trach II Industrial Park as per government regulations and commenced operations in December 2019, incurring efficiency losses and additional costs during the process[14](index=14&type=chunk) 2019 Sales Volume Performance | Market | Sales Volume (Thousand Units) | Year-on-Year Change | Primary Reason | | :--- | :--- | :--- | :--- | | Vietnam | 63.4 | +3.6% | Benefited from government policies and marketing targeting the student market, leading to increased sales of entry-level mopeds | | ASEAN Exports | 54.0 | -18.3% | Major export markets Malaysia and the Philippines faced impact from low-priced Chinese models | - The Group launched several new models, including the New Attila 125 scooter for urban women and a 50cc moped series for young students, while also engaging in OEM cooperation with the Lambretta brand through a strategic alliance[17](index=17&type=chunk) [Financial Review](index=5&type=section&id=Financial%20Review) For FY2019, the Group's net loss significantly narrowed by **58%** to **$17.6 million**, with total revenue increasing **8.7%** to **$99.5 million**, gross profit turning positive at **$5.4 million** (a **5.4%** margin), and operating expenses decreasing, despite an **$8.3 million** impairment loss on property, plant, and equipment, while net current assets declined and the debt-to-equity ratio rose from **23%** to **43%** FY2019 Key Financial Indicators (Million USD) | Indicator | 2019 | 2018 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 99.5 | 91.5 | +8.7% | | Gross Profit / (Loss) | 5.4 | (2.3) | Turned profitable | | Gross Profit Margin | 5.4% | (2.5%) | +7.9 ppt | | Loss from Operating Activities | (11.0) | (23.3) | -53% | | Net Loss | (17.6) | (41.8) | -58% | | Net Loss Margin | 18% | 46% | -28 ppt | 2019 Revenue by Region (Million USD) | Region | 2019 Revenue | 2018 Revenue | Year-on-Year Change | Proportion of Total Revenue (2019) | | :--- | :--- | :--- | :--- | :--- | | Vietnam Domestic Sales | 50.8 | 50.2 | +1.2% | 51% | | Export Sales | 48.7 | 41.3 | +18% | 49% | - Due to unsatisfactory performance, the Group conducted impairment tests on related property, plant, and equipment, recognizing an impairment loss of approximately **$8.3 million**[28](index=28&type=chunk) - As of the end of 2019, the Group's net current assets were **$57.5 million** (2018: **$77.7 million**), and the debt-to-equity ratio (bank loans/shareholders' equity) increased from **23%** to **43%**[31](index=31&type=chunk) [Outlook](index=7&type=section&id=Outlook) For 2020, the Group anticipates stable Vietnamese economic growth but remains cautious of risks from uncertain Chinese parts supply, intense market competition, and global macroeconomic factors, planning to focus on product innovation with new models, introduce a new corporate identity, improve dealer systems, and explore land development opportunities to diversify revenue streams - Vietnam's economy is expected to grow steadily in 2020, but risks include uncertainty in Chinese parts supply, intense price competition in the motorcycle industry, and global trade frictions[39](index=39&type=chunk) - Product Strategy: The Group plans to launch several new or revamped scooter, moped, and electric vehicle models to increase the proportion of high-value-added products[40](index=40&type=chunk) - Market Strategy: The Group will introduce a new corporate identity system, change the SYM brand logo, improve the dealer agency system, and expand sales and maintenance service points[40](index=40&type=chunk) - Asset Revitalization: The Group will review the land development potential of its old factory in Bien Hoa City, Dong Nai Province, and continue to advance the joint venture land development project in Ha Dong District, Hanoi City, to expand revenue sources[40](index=40&type=chunk) [Other Disclosures](index=8&type=section&id=Other%20Disclosures) As of the end of 2019, **$22.8 million** of the **$76.7 million** net proceeds from the 2007 IPO remained unutilized, primarily allocated for production site development and land development, with the company also acquiring a property in Hanoi for **VND 70 billion** (approximately **$3 million**) during the year, and the Board not recommending a final dividend Use of IPO Proceeds (As of December 31, 2019, Million USD) | Use | Planned Net Amount | Amount Utilized | Unutilized Balance | | :--- | :--- | :--- | :--- | | R&D Center and Distribution Channels | 30.7 | 30.7 | – | | M&A and Working Capital | 11.7 | 11.7 | – | | Production Site Development and Relocation | 15.0 | 7.3 | 7.7 | | Land Development | 19.3 | 4.2 | 15.1 | | **Total** | **76.7** | **53.9** | **22.8** | - During the year, the company acquired a property in Tay Ho District, Hanoi City, Vietnam, through a nominee for a total consideration of **VND 70 billion** (approximately **$3 million**)[46](index=46&type=chunk) - The Board does not recommend the payment of a final dividend for the year ended December 31, 2019[50](index=50&type=chunk) [Corporate Governance Report](index=10&type=section&id=Corporate%20Governance%20Report) [Corporate Governance Practices and the Board](index=10&type=section&id=Corporate%20Governance%20Practices%20and%20the%20Board) The company complied with the HKEX Listing Rules' Corporate Governance Code in 2019, with the only deviation being the absence of a Nomination Committee, whose responsibilities were assumed by the Board, which comprises **4** executive, **2** non-executive, and **3** independent non-executive directors, ensuring a balanced structure with separate roles for Chairman and CEO - The company complied with the Corporate Governance Code, with the only deviation being the absence of a Nomination Committee, whose functions were performed by the Board[53](index=53&type=chunk) - The Board consists of **9** members, including **4** executive directors, **2** non-executive directors, and **3** independent non-executive directors[57](index=57&type=chunk) - The responsibilities of the Chairman (Mr. Liu Wu-Hsiung) and the Chief Executive Officer (Mr. Lin Chih-Ming) are clearly separated and not held by the same individual[61](index=61&type=chunk) [Board Committees](index=11&type=section&id=Board%20Committees) The company has established a Remuneration Committee, comprising two independent non-executive directors and one executive director, responsible for executive compensation, and an Audit Committee, composed of three independent non-executive directors, overseeing financial reporting, risk management, and internal controls, with both committees holding multiple meetings during the year with full attendance - The Remuneration Committee comprises Ms. Lin Ching-Ching (Chairperson), Ms. Wu Kuei-Mei, and Mr. Liu Wu-Hsiung, and held **three** meetings during the year[66](index=66&type=chunk)[67](index=67&type=chunk) - The Audit Committee comprises three independent non-executive directors: Ms. Lin Ching-Ching (Chairperson), Mr. Shen Hua-Jung, and Ms. Wu Kuei-Mei, and held **four** meetings during the year[68](index=68&type=chunk)[69](index=69&type=chunk) [Risk Management and Internal Control](index=13&type=section&id=Risk%20Management%20and%20Internal%20Control) The Board is responsible for assessing the Group's risk appetite and ensuring effective risk management and internal control systems, with an internal audit department reviewing financial, operational, and compliance controls at least annually, and management confirming the effectiveness and adequacy of these systems for 2019, alongside established procedures for handling and disseminating inside information - The Board is responsible for ensuring the Group establishes and maintains appropriate and effective risk management and internal control systems, and reviews their effectiveness at least once a year[77](index=77&type=chunk) - Management has confirmed to the Board that, as of the end of 2019, the company's risk management and internal control systems were effective and adequate[77](index=77&type=chunk) - The Group has established procedures for handling and disseminating inside information to ensure timely public disclosure of inside information whenever reasonably practicable[81](index=81&type=chunk) [Shareholder Relations and Rights](index=15&type=section&id=Shareholder%20Relations%20and%20Rights) The Group maintains transparent communication with shareholders and investors through annual reports, announcements, and its website, clearly outlining shareholder rights, including the procedure for calling an extraordinary general meeting by shareholders holding at least **10%** of the paid-up capital and the process for nominating director candidates - The Group is committed to maintaining high transparency, ensuring investors and shareholders receive timely company information[88](index=88&type=chunk) - Shareholders holding not less than **10%** of the company's paid-up capital may request the Board in writing to convene an extraordinary general meeting[90](index=90&type=chunk) [Biographies of Directors and Senior Management](index=16&type=section&id=Biographies%20of%20Directors%20and%20Senior%20Management) This section provides detailed biographies of the company's executive, non-executive, and independent non-executive directors, as well as senior management, including their age, position, professional experience, educational background, and tenure within the Group and affiliated companies like Sanyang Industry, with most core management possessing over **20** years of experience in the motorcycle industry - This chapter details the personal resumes of the company's executive directors, non-executive directors, independent non-executive directors, and senior management, including their age, position, professional experience, educational background, and tenure within the Group and affiliated companies (such as Sanyang Industry)[93](index=93&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk)[96](index=96&type=chunk) - Most core management personnel possess over **20** years of senior experience in the motorcycle industry[100](index=100&type=chunk) [Directors' Report](index=18&type=section&id=Directors%27%20Report) [Principal Activities and Performance](index=18&type=section&id=Principal%20Activities%20and%20Performance) The company's principal activity is investment holding, with its subsidiaries primarily engaged in manufacturing and selling motorcycles, parts, engines, and providing maintenance services, and while the Group's 2019 performance is detailed in the financial statements, the Board does not recommend a final dividend for the year, having adopted a dividend policy to share profits while retaining sufficient reserves for future growth - The Group's principal activities are the manufacturing and sale of motorcycles, parts, and engines, as well as providing motorcycle maintenance services[104](index=104&type=chunk) - The Board does not recommend the payment of a final dividend for the year ended December 31, 2019[105](index=105&type=chunk) [Major Customers and Suppliers](index=19&type=section&id=Major%20Customers%20and%20Suppliers) In FY2019, the Group exhibited high customer concentration, with the largest customer accounting for **24.4%** of total revenue and the top five customers collectively representing **49.5%**, while its supplier base was more diversified, with the top five suppliers accounting for less than **30%** of total purchases FY2019 Customer Concentration | Customer Category | Percentage of Total Revenue | | :--- | :--- | | Largest Customer | 24.4% | | Top Five Customers | 49.5% | - As of the end of 2019, the total purchases from the Group's top five suppliers accounted for less than **30%** of total purchases[113](index=113&type=chunk) [Directors' and Major Shareholders' Interests](index=21&type=section&id=Directors%27%20and%20Major%20Shareholders%27%20Interests) This report discloses the share interests of directors and chief executives in an associated corporation, Sanyang Industry Co., Ltd., and identifies Sanyang Industry Co., Ltd., through its wholly-owned subsidiary SY International Ltd., as the company's major controlling shareholder, holding **608,818,000** ordinary shares, representing **67.07%** of the total share capital - Several directors hold shares in the ultimate holding company, Sanyang Industry Co., Ltd., with non-executive director Ms. Wu Kuei-Mei holding the highest proportion at approximately **1.997%**[129](index=129&type=chunk) Major Shareholder Holdings (As of December 31, 2019) | Major Shareholder Name | Capacity | Number of Shares Held | Approximate Percentage of Total Share Capital | | :--- | :--- | :--- | :--- | | Sanyang Industry Co., Ltd. | Interest in controlled corporation | 608,818,000 | 67.07% | | SY International Ltd. | Beneficial owner | 608,818,000 | 67.07% | [Connected Transactions](index=22&type=section&id=Connected%20Transactions) The Group engages in multiple continuing connected transactions with its indirect major shareholder, Sanyang Group, primarily involving the purchase and sale of motorcycle parts, distribution agency, technical licensing, and R&D services, with all transactions in 2019 remaining within their approved annual caps and confirmed as fair and reasonable by independent non-executive directors and auditors 2019 Major Continuing Connected Transactions (USD) | Transaction Agreement | Nature of Transaction | 2019 Actual Amount | 2019 Annual Cap | | :--- | :--- | :--- | :--- | | Master Purchase Agreement | Purchase of parts from Sanyang Group | 10,826,883 | 11,100,000 | | Distribution Agreement | Acting as distributor for Sanyang Group | 2,304,048 | 3,301,000 | | Technical License Agreement | Use of Sanyang technology | 1,276,535 | 2,580,000 | | Parts Sales Agreement | Sale of parts to Sanyang Group | 1,188,103 | 1,550,000 | - Both the independent non-executive directors and the company's auditors have reviewed the continuing connected transactions during the year and confirmed that the transaction terms are fair and reasonable, in the overall interest of the company and its shareholders, and did not exceed the annual caps[144](index=144&type=chunk) [Environmental, Social and Governance Report](index=25&type=section&id=Environmental%20Social%20and%20Governance%20Report) [Environment and Safety](index=26&type=section&id=Environment%20and%20Safety) The Group adheres to ISO 14001 environmental management and 5S safety systems, with primary environmental risks from VOC emissions during painting, which decreased by **0.76%** in 2019, though total waste significantly increased to **682,246 kg** due to factory relocation, while maintaining robust wastewater treatment and energy/water conservation efforts, with no major environmental violations reported - The Group adheres to the ISO 14001 environmental management system and the 5S safety management system, with a Safety and Health Committee led by the General Manager[159](index=159&type=chunk)[160](index=160&type=chunk) 2019 Emissions Data | Emission | Emission Volume | | :--- | :--- | | Carbon Dioxide | 9,490,534 tonnes | | Volatile Organic Compounds (VOC) | 29,099 tonnes | | Hazardous Waste | 448,552 kg | | Non-Hazardous Waste | 233,724 kg | - The Group provides annual physical examinations and environmental safety and health training for employees, with special positions undergoing occupational disease examinations, and no occupational diseases were found among employees in 2019[178](index=178&type=chunk) [Product Responsibility](index=30&type=section&id=Product%20Responsibility) Guided by 'Focus on Core Business, Quality First, Customer Satisfaction,' the Group implements ISO 9001 quality management, conducts regular quality, technical, and environmental audits of suppliers, prioritizing local procurement in Vietnam, and engages with dealers and consumers through satisfaction surveys and communication, reporting no major quality violations or product recalls in 2019 - The Group establishes quality control procedures in accordance with ISO 9001 quality management system requirements and has a "Product Quality Defect Recall and Correction Measures" in place, with no major quality violations or product recalls during the year[180](index=180&type=chunk)[181](index=181&type=chunk) - Supplier management adopts a global procurement principle while prioritizing local procurement in Vietnam whenever possible, and the Group conducts regular on-site audits of suppliers[181](index=181&type=chunk) - The Group conducts annual customer satisfaction surveys and comprehensive product surveys for the Vietnamese market to understand end-consumer needs[184](index=184&type=chunk)[185](index=185&type=chunk) [Employee Care](index=32&type=section&id=Employee%20Care) The Group upholds diversity and non-discrimination, offering salaries approximately **17%** above the legal minimum wage, along with year-end bonuses and other incentives, with a welfare committee providing subsidies, group insurance, health checks, and recreational activities, strictly prohibiting child and forced labor, establishing a labor union, and offering comprehensive training programs, including opportunities for Vietnamese executives at Sanyang Taiwan - The Group's standard employee salaries are approximately **17%** higher than the government's statutory minimum wage, and it provides year-end bonuses and holiday bonuses[188](index=188&type=chunk) - The Group has legally established a labor union, which holds regular quarterly meetings, and an annual "Labor Conference" to ensure smooth labor-management communication[191](index=191&type=chunk) - A comprehensive employee training system and training center are in place, offering diverse courses, and providing opportunities for Vietnamese executives to intern at the Taiwan headquarters[191](index=191&type=chunk)[192](index=192&type=chunk) [Anti-Corruption and Community Engagement](index=34&type=section&id=Anti-Corruption%20and%20Community%20Engagement) The Group strictly prohibits corruption, adhering to a 'Code of Professional Ethics' and maintaining a robust internal audit system to prevent fraud, with no significant non-compliance or corruption issues identified in 2019, and annually invests approximately **VND 1 billion** (around **$42,500**) in environmental, social, and educational community initiatives, such as supporting underprivileged students and improving living conditions - The Group has a strict "Code of Professional Ethics" prohibiting corruption, bribery, and other misconduct, and has established an internal audit unit, reporting directly to the Board, for supervision[194](index=194&type=chunk)[195](index=195&type=chunk) - The Group annually invests approximately **VND 1 billion** (around **$42,500**) in community welfare activities, covering three major areas: environmental protection, social participation, and education and culture[199](index=199&type=chunk) [Independent Auditor's Report](index=36&type=section&id=Independent%20Auditor's%20Report) [Audit Opinion](index=36&type=section&id=Audit%20Opinion) KPMG, the auditor, issued an unmodified opinion, stating that the consolidated financial statements fairly present the Group's financial position as of December 31, 2019, and its financial performance and cash flows for the year then ended, in accordance with International Financial Reporting Standards and the disclosure requirements of the Hong Kong Companies Ordinance - KPMG, the auditor, issued an unmodified audit opinion on the company's consolidated financial statements for the year 2019[202](index=202&type=chunk) [Key Audit Matters](index=36&type=section&id=Key%20Audit%20Matters) A key audit matter was the impairment assessment of property, plant, and equipment, right-of-use assets, and prepayments for these assets, given the Group's sustained losses, which involved significant management judgment; the auditors evaluated management's assessment process, challenged key assumptions in cash flow forecasts, performed sensitivity analyses, and utilized internal valuation experts to assess reasonableness - A key audit matter was the impairment assessment of non-current assets related to the motorcycle business, as its determination involves significant management judgment and inherent uncertainty[206](index=206&type=chunk)[207](index=207&type=chunk) - The auditor's procedures included evaluating management's assessment process, challenging key assumptions in cash flow forecasts, performing sensitivity analyses, and assessing the independence and methodology of external valuation experts[207](index=207&type=chunk) [Consolidated Financial Statements and Notes](index=40&type=section&id=Consolidated%20Financial%20Statements%20and%20Notes) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=40&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For FY2019, the Group's revenue increased **8.7%** to **$99.5 million**, gross profit turned positive to **$5.37 million** from a prior-year loss, operating loss narrowed to **$10.99 million**, and after an **$8.29 million** impairment loss and **$1.65 million** net finance income, the pre-tax loss was **$17.57 million**, resulting in a significantly reduced loss attributable to equity holders of **$17.59 million** (from **$41.84 million**), with basic loss per share at **$0.02** Consolidated Income Statement Summary (USD) | Item | 2019 | 2018 | | :--- | :--- | :--- | | Revenue | 99,499,318 | 91,546,757 | | Gross Profit / (Loss) | 5,371,492 | (2,330,403) | | Result from Operating Activities | (10,989,394) | (23,315,513) | | Loss Before Tax | (17,570,369) | (40,508,754) | | Loss for the Year After Tax | (17,594,249) | (41,842,673) | | Loss Attributable to Equity Holders of the Company | (17,594,257) | (41,842,673) | | Loss Per Share (Basic and Diluted) | (0.02) | (0.05) | [Consolidated Statement of Financial Position](index=42&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of December 31, 2019, the Group's total assets decreased to **$109.2 million** from **$115.2 million**, while total liabilities increased to **$44.73 million** due to higher bank loans, leading to a reduction in net assets (total equity) from **$82.12 million** to **$64.57 million**, with net current assets at **$57.5 million** and the current ratio declining from **3.3** to **2.3** Consolidated Statement of Financial Position Summary (USD) | Item | December 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | **Assets** | | | | Non-Current Assets | 7,988,584 | 4,435,924 | | Current Assets | 101,232,034 | 110,775,290 | | **Total Assets** | **109,220,618** | **115,211,214** | | **Liabilities and Equity** | | | | Current Liabilities | 43,729,879 | 33,078,444 | | Non-Current Liabilities | 925,636 | 13,037 | | **Total Liabilities** | **44,655,515** | **33,091,481** | | **Total Equity** | **64,565,103** | **82,119,733** | [Consolidated Statement of Cash Flows](index=44&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) In 2019, net cash used in operating activities improved to **$12.42 million** from **$26.78 million**, net cash outflow from investing activities was **$5.10 million** primarily for property, plant, and equipment, and net cash inflow from financing activities was **$7.95 million** mainly from new bank loans, resulting in a net decrease of **$9.56 million** in cash and cash equivalents, with an ending balance of **$19.02 million** Consolidated Statement of Cash Flows Summary (USD) | Item | 2019 | 2018 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (12,417,076) | (26,777,591) | | Net Cash (Used in) / Generated from Investing Activities | (5,101,491) | 46,810,150 | | Net Cash Generated from / (Used in) Financing Activities | 7,953,813 | (4,623,650) | | **Net (Decrease) / Increase in Cash and Cash Equivalents** | **(9,564,754)** | **15,408,909** | | Cash and Cash Equivalents at January 1 | 28,578,446 | 13,356,314 | | **Cash and Cash Equivalents at December 31** | **19,016,628** | **28,578,446** | [Notes to the Consolidated Financial Statements](index=45&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes detail the company's significant accounting policies, estimates, and judgments, providing comprehensive classifications and explanations for financial statement items, including the impact of IFRS 16 adoption, segment information by business and geography, specifics of asset impairment losses, related party transactions, and financial risk management policies - The company adopted IFRS 16 "Leases" from January 1, 2019, choosing the modified retrospective approach, with adjustments made to the opening balances and comparative information not restated[251](index=251&type=chunk) - Note 4 provides detailed disclosure of revenue and segment results by business (manufacturing and sales of motorcycles, parts and engines, molds, and maintenance services) and by region (Vietnam, Malaysia, Philippines, etc)[336](index=336&type=chunk)[339](index=339&type=chunk)[345](index=345&type=chunk) - Note 11(c) details the **$8.29 million** asset impairment loss recognized during the year, attributed to intense competition in the motorcycle industry and increased manufacturing costs leading to sustained operating losses[373](index=373&type=chunk)[374](index=374&type=chunk) - Note 26 provides specific amounts for continuing connected transactions with the ultimate holding company, Sanyang, and its subsidiaries, including sales, purchases, and technology transfers[462](index=462&type=chunk)

Vietnam Manufacturing and Export Processing (Holdings) Limited 越南製 造加工出口(控股)有限公司 (Stock Code: 422) (Incorporated in the Cayman Islands with limited liability) Vietnam Manufacturing and Export Processing (Holdings) Limited 越南製 造加工出口(控股)有限公司 （股份代號:422） （於開曼群島註冊成立之有限公司） 中期報告2019 INTERIM REPORT2019 目 錄 公司資料 2 管理層討論及分析 3 其他事項 10 獨立核數師審閱報告 15 綜合損益及其他全面收益表 16 綜合財務狀況表 18 綜合權益變動表 20 簡明綜合現金流量表 21 未經審核中期財務報告附註 22 二零一九年中期報告 02 畢馬威會計師事務所 | --- | --- | |------------------------|------------------------------------------- ...