Message from the chairman

 

Dear Shareholders,

 

We have ended the year 2017 in the context where the economy reached all the targets set forth by the National Assembly, GDP increased by 6.81%, topping every forecast, the highest in 6 years. This increase exceeded all previous forecasts made by organizations such as the World Bank or the Asian Development Bank. The size of the economy in 2017 at current price level reached VND 5,007.9 trillion. Average GDP per capita is estimated at VND 53.5 million, equivalent to USD 2,385, up USD 170 compared to 2016.


In terms of economic structure this year, agriculture, forestry and fisheries accounted for 15.34% of total GDP; industrial and construction sector accounted for 33.34%; service sector accounted for 41.32%; taxes on products less subsidies on products accounted for 10.00% (corresponding 2016 structure was: 16.32%; 32.72%; 40.92%; 10.04%).


Inflation this year was lower than the target set by the National Assembly. Consumer Price Index (CPI) in December only increased 0.21% over the previous month. Average CPI increased 3.53% compared to 2016 average. Average CPI in December 2017 only increased 2.6% compared with December 2016, an average monthly increase of 0.21%. Average inflation in 2017 was 1.41% higher than 2016 average. Trade balance in 2017 experienced a trade surplus of USD 2.7 billion, of which the domestic economic sector imposed a trade deficit of USD 26.1 billion; FDI sector a trade surplus of 28.8 billion USD.


Not only was the economy growing well, the quality of growth has improved significantly, helping the stock market to develop spectacularly. VnIndex closed on Dec 31 at 984.2 points - up 48% from the end of 2016. In terms of scale, market capitalization reached USD 153.4 billion, up 80.5% over the same period and equivalent to 70% of GDP. Average trading value reached VND 5 trillion, up about 63% compared to 2016. Liquidity increased sharply, with multi-billion dollar successful capital raisings. The securities market has indeed become an effective channel of medium and long term capital for the economy.


With the vision of a leading financial institution and the efforts of our entire staff, our Company has achieved remarkable achievements. The Company reported a revenue of VND 3,043.2 billion, up 19.8% YoY, coming in at 44.35% over FY2017 revenue target. 2017 consolidated profit before tax reached VND1,405 billion, increased 23% compared to 2016, exceeding the target by 32.8%. Total consolidated assets reached VND 18,764.4 billion - up 34% over the same period last year, of which owner's equity reached VND 8,616.2 billion.

 

Securities Services continued to affirm the number 1 position, market share of securities and fund certificates brokerage reached 15.26% on both Exchanges; leading the market share on derivatives trading, accounting for 28.28% of the market. SSI has also successfully carried out divestments and securities distribution transactions worth hundreds of millions of USD such as for Vietnam National Petroleum Group (PLX - HOSE), Vietnam Dairy Products Joint Stock Company (VNM) - HOSE), Vietjet Aviation Joint Stock Company (VJC - HOSE), Vincom Retail Joint Stock Company (VRE - HOSE), etc.


Investment Banking affirmed the leading position in the Vietnamese market, successfully carrying out many large-scale deals such as: Offering advisory for 48.33 million shares of Vietnam Dairy Products Joint Stock Company (VNM - HOSE) valuing at USD 396 million; Advising on the sale of 415 million shares of Vincom Retail Joint Stock Company (VRE - HOSE) at USD 742 million; Secondary sale of Ho Chi Minh City Development Commercial Joint Stock Bank (HDB - HOSE) with total value of USD 300 million; Advising on the sale of Vietnam National Petroleum Group (PLX - HOSE) at USD 50 million; Raising USD 230 million for Hoa Phat Group Joint Stock Company (HPG - HOSE), etc. SSI received the Best Private Equity Deal across the Asia Pacific 2017 for the share offering deal of Vincom Retail (VRE - HOSE) by Finance Asia.


Treasury always presents impressive highlights in the business of the Company: Revenue reached VND 487.4 billion, accounting for 16% of the Company's total revenue; Liquidity was assured in the face of pressure on capital demand from other Business Units as well as financial support required from the securities market; Actively developed and traded structured products within the Unit as well as cross-selling with other Business Units.


SSI Asset Management Company Limited (SSIAM) increased the total assets under management (AUM) for external customers to VND 6.112 billion, up 60.3% from 2016, continuing to diversify portfolio of products for investors. SSIAM also completed the conversion of the reference index SSIAM HNX30 ETF to the VNX50 index, renaming the fund to SSIAM VNX50 ETF and listing on the Ho Chi Minh Stock Exchange (HOSE) under the code FUESSV50 from October 2017.

 

Revenue from Principal Investment reached VND 1,060.8 billion, contributing 34.7% to the total revenue of SSI, with total investment value in 2017 reached VND 3,829 billion.


The achievements in business activities cannot be highlighted without mentioning contributions of the strong back office support. The Governance Unit is always the front line to ensure the Company's high transparency and compliance, providing timely management information, updating changes to support the Board of Management to have a close grasp of the Company and make right decisions. The risk management activities have also been strengthened, building a risk-management culture aligned throughout the Company. Not only does it play a role in supervisory, the Unit has also proved its role as a trusted consultant to provide business operation solutions, maintaining compliance while simultaneously harmonizing the goals of the divisions.


Support Unit continuously provided support and team effort to contribute to the overall achievement of the Company. The recruitment and training of the staff were promoted along with the development of policies to ensure the benefits and motivation for nearly 900 members. Corporate Communication continued to serve well as a bridge between the Company and the media as well as with investors so that all activities of the Company are reflected honestly to the public. We have also successfully organized a series of events in various scales such as the Gateway to Vietnam 2017, "Capital Market – A New Driver for Vietnam's Economic Growth" or the serial Seminars on Derivatives Investment opportunities that have been perceived to be remarkable and valuable to the overall securities market. As a leading securities company with the highest market share, highest trading volume and the highest number of customers using the trading system, SSI Information Technology has faced and overcome many challenges to ensure daily operation with high automation requirements, complete the new trading system to be launched in 2018, while in parallel timely launching the derivatives trading system, being the first organization to pilot run derivatives trading trading before the official market went live.


In 2018 the Company continues to set ambitious plans to continue to reinforce the leading position in the market, targeting VND 3,410 billion in revenues and VND 1,615 billion in profit.


Securities Services always places customers at the focus to serve and as the foundation for success; Designs new products and improves product quality to suit each customer group, invests in modern technology systems and pioneers leading the supply of new products; Improves staff efficiency through effective implementation of recruitment, training, performance monitoring and career advancement, develops a disciplined, professional, aspirational and motivated working environment; Closely monitor the observance of standards on professional ethics.


Treasury, always identified as a critical unit in the business system of the Company, continues to maintain total capital growth and diversification; Expands trading activities in corporate bonds, derivatives and structured products to appeal to a wide range of customers; Always maintains a high level of trust with partners.


SSIAM restructures the specialization in each section in order to increase in the size of collateral assets as well as investment efficiency; Develops distribution channels and distribution partners, and continues to diversify products to meet the diverse needs of customers.


Investment Banking focuses on expanding its customer network; Continues building partnerships with leading financial institutions in the world; Focuses on the training of personnel with professional capacity and deep industry understanding.


Principal Investment defines a value-for-money investment strategy that is flexible and close to the market, regularly evaluates macroeconomic factors, follows the operation fundamentals of businesses, determines intrinsic value of businesses without being dominated by the current market prices; Exercises portfolio allocation to leverage market's growth momentum while ensuring that volatility risks are mitigated at home and abroad; Balances long-term strategic investments and passive investments.


Governance Unit aims to improve the automation of operations, ensuring accuracy, timeliness and absolute compliance. Support Unit meets the diverse needs of the Company, especially focusing on IT activities to boost the Company's business operations and create competitive advantages in the securities industry.


I would like to sincerely thank our valued customers and business partners who have been with us. We always recognize you as benefactors of SSI. I would like to thank our shareholders for trusting the Board of Directors and Board of Management and approving the plans made at the General Shareholders' Meeting, thank the members of the Board who have together developed the prudent development strategy and business plans. I would like to thank all Staff members for their hard work and commitment to bring our Company to a new level every year. With your cooperation, in 2018 we will continue to achieve outstanding successes.


We wish You good health and success!

 

Chairman cum Chief Executive Officer

 

Nguyen Duy Hung