Petrolimex-AR 2705 Eng

01.
GENERAL INFORMATION
PETROLIMEX
ANNUAL REPORT 2017 1
2 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
AGENDA
1 2 3
GENERAL INFORMATION BUSINESS PERFOMANCE IN BOARD OF DIRECTORS
2017 REPORT AND EVALUATION
1 Brief overview 12 1 Production and business 50 1 Evaluation on production and 68

performance business performance
2 Foundation and development process 14
2 Organization and human 52 2 Financial situation 80
3 Scope and locations of business 16 resources
3 Improvements in structure, 83
4 Petrolimex’s mission and vision 20 3 The Investment and 59 policy and management
Implementation of projects
5 Core values 22 4 Proposed plan for 2018 84
4 The Group’s Consolidated 61
6 Key achievements 24 financial performance
MISSION 7 Administration model, business

organization and system of
26 5 Shareholders’ structure,
owner’s equity changes
63
Raising shareholders’ value, bringing management
welfare to laborers, communities; raising

the value of life; contributing to the VISION 8
9
Value chain
Development orientation
32
36
country’s socio-economic development
Maintaining its position as one of the
10 Risks 40
largest Corporations in Vietnam, leading the
petroleum business downstream; Continuing
its petrol business as the primary operation,
expanding in the fields of liquefied petroleum
4 5 6
gas, petrochemical, petroleum transportation,
import and export, insurance, etc. becoming
one of top 10 enterprises in the country in
terms of largest market size and highest
economic efficiency
EVALUATION OF THE GROUP ADMINISTRATION CONSOLIDATED FINANCIAL
BOARD OF DIRECTORS ON STATEMENTS
THE PERFORMANCE OF
THE GROUP
1 Evaluation on the performance 88 1 Board of Directors 98

of Petrolimex
2 Board of Supervisory 101
2 Evaluation on the performance 89
of the Board of Directors 3 Departments under Board of 102
Directors
3 The Board of Directors activities 90
in 2017 4 Transactions, remuneration and 108
benefit packages of the BoDs,
4 Orientation plans of the Board 91 BoM and the Supervisory Board
of Directors
4 PETROLIMEX
ANNUAL REPORT 2017 01. GENERAL INFORMATION
MESSAGE FROM
CHAIRMAN OF BOARD OF
MANAGEMENT
Ladies and Gentlemen,
With the tradition of the Vietnamese revolutionary petroleum in-

dustry, generations of leaders, officers and workers have made
wholehearted and tireless efforts to build, develop and diver-
sify Petrolimex’s selected businesses with oil as the core. The
Group has promoted many products to be the Vietnamese leading
brands such as PLC, PGC, Pjico, Vipco, Vitaco,… and they are
still striving to move further forward.
Switching to joint stock model operating under Enterprise Law,

Petrolimex continues to play a pivotal role in the development of
Vietnam petroleum market, contributing to the stabilization of the
national macro-economy, assurance of social security and sus-
tainable growth. Beside the downstream business, Petrolimex will
strongly invest in refining and petrochemical as well as other up-
stream activities in the oils industry, renovate business models,
concentrate resources for development and improve quality of the
enterprise comprehensively.
In 2017, the Group’s production and business results were rela-

tively comprehensive. The Group met and exceeded targets set
6 PETROLIMEX
ANNUAL REPORT 2017 01. GENERAL INFORMATION 01. GENERAL INFORMATION
PETROLIMEX
by the Annual General Meeting. At the same time, PLC marked a turning point when offi-
cially listing on Ho Chi Minh City Stock Exchange (PLX code), being in the Top 50 Vietnam
best listed companies, taking the first place in revenue.
The breakthrough of listing on the stock exchange marks Petrolimex’s new development
phase, switching Petrolimex into a publicly traded corporation with its shareholders being
foreign individuals and organizations; Enterprise administration is upgraded to interna-
tional standard, assuring transparency in reporting and explaination; Petrolimex’s market
capitalization as of now gains over VND 100 billion.
2017 being the transitional year in fulfilling the Group’s restructuring scheme, corpora-
tions were established basing on business scopes to improve its business efficiency.
Moreover, the Group executed key projects on oil filter and pure fuel transfer in the com-
ing years, toward a green enterprise with sustainable growth.
In parallel with expansion and consolidation of its position in domestic market, Petrolimex
will continue to boost its activities in international markets, especially in Singapore, - a
major oil hub in the world – and in the regional market. One of the main directions of
Petrolimex is to develop the human factor which puts human in central position, makes
the enterprise as an environment to promote their creativeness with the aim to build an
efficient and skillful working group, affirming Petrolimex culture and striving to turn Petro-
limex into a major and leading group integration in the domestic market as well as being
capable of integrating and competing in the world.
With strong determination and high spirit of responsibility to move forward, together we
shall bring convenient, friendly and high-quality products and services to the society.
I would like to sincere thank ladies and gentlemen for your trust and accompanion with
Petrolimex for the time being. I believe that, the right direction, committment, great effort
and co-operation will bring us solid steps in the future.
Thank you .
Chairman of Board of Management
Bui Ngoc Bao

8 PETROLIMEX
PETROLIMEX
MESSAGE FROM
PETROLIMEX
GENERAL DIRECTION
Excellencies, (Ladies and Gentlemen,)
VietNam National Petroleum Corporation (Petrolimex Corporation) being the leading Corporation in downstream business with its main Conveying the key message: Tradition, determination with the
was entrusted with the task of supplying petroleum and petrochemical business being petroleum trading, taking these above leverage to desire to move forward, I do believe that Petrolimex will continue
products for the cause of national socio-economic development and develope other fields. Along with the task of safe, effective production to sustainably develop with wide-spread energy to contribute to the
meeting people’s demand to ensure defence security and play its and business in every sectors while sustaining the Group’s steady national development.
predominant role in stabilizing and developing the national petroleum growth rate in whole, Petrolimex will utilize its resources and
Thank you!
market. Over 60 years of building and development of VietNam solutions to obtain key targets including: Reaching and exceeding
National Petroleum with its tireless effort and incessant renovation the expectation set by the 2018 annual general meeting; restructuring
for development and integration, Petrolimex Corporation has been the organization of enterprises under the Corporation and intending
General Director
maintaining the leading position in downstream and petrochemical to reduce the enterprises’ State ownership; improving and bettering
business within Vietnamese market. the administration to incessantly raise the efficiency in Group’s
performance, meeting the requirements of international economic
In the period of 2015 -2020, Petrolimex has been consistently integration
determining the targets of raising the production and business
efficiency, actively integrating, expanding regional and international Synchronously executing the solutions to sustain the market share,
Pham Duc Thang
trading relationship, developing into a growingly strong corporation stabilize the production growth rate and trading petroleum profit in
with sustainable development. 2017 is the third consecutive year that mid term and long term, adopting drastic solutions for a breakthrough
the Corporation fulfilled and outdid the year’s targets and witnessed in developing retail network at the same time consolidating the brand
the sales of petroleum in domestic market continue to grow. protection, upgrading brand identity to affirm the leading brand
Beside the comprehensive results of production and business, the position in petroleum market. Moreover, application of IT solutions,
Corporation has gained significant achievements including official labor organization and regularly supervising all phases of circulation
list on the HCM stock exchange with full attention from domestic process ensure the petroleum quality from import to consumers.
and foreign investors, initially affirming the transparence in Group’s
Regarding non-petroleum business areas, Petrolimex continues to
administration and sustainable development. Furthermore, complete
affirm and maintain the Group’s system in whole, cooperate among
transition to E5 replacing RON 92 since December, 25th, 2017 and
divisions, sectors to ensure the system efficiency and harmonize the
trading RON 95 at level III, IV and Diesel at level V since January,
benefits;
1st, 2018 have marked a breakthrough. The number of newly-built
petroleum stations put into operation was the highest in the last Sincerely thanks employees - Petrolimex’s energetic individuals for
recent years, raising the total number of Petrolimex - owned petrol your trust , your proactive, effective performance and companion with
stations to 2500. Petrolimex to gain today achievements, serving the customers and
contributing to the national development. Thank to Shareholders for
Moving on to 2018, Petrolimex continues to determine the target of
your support and your trust in Petrolimex’s development.
01. GENERAL
INFORMATION
1. Brief overview
2. Foundation and development process
3. Scope and locations of business
4. Petrolimex’s mission and vision
5. Core values
6. Key achievements
7. Administration model, business organi-
zation and system of management
PETROLIMEX 8. Value chain

9. Development orientation
GAS & OIL 10. Risks
12 PETROLIMEX
PETROLIMEX
1. BRIEF
OVERVIEW
Trading name Vietnam National Petroleum Group
Abbreviated name PETROLIMEX
Ticker symbol PLX
Certificate of Business Reg- 0100107370

istration no.
Authorized capital 12,938,780.810,000 VND
Owner’s equity 12,938,780,810,000 VND
Address No.1 Kham Thien Street, Kham Thien Ward,

Dong Da District, Hanoi, Vietnam
Tel. (024) 3851 2603
Fax (04) 3851 9203
Website http://www.petrolimex.com.vn
14 PETROLIMEX
PETROLIMEX
2. FOUNDATION AND
DEVELOPMENT PROCESS
1956 2011 2011 2016 2016

The forerunner of Vietnam Vietnam National Petroleum Petrolimex operated officially in Petrolimex was licensed with Certificate On 28th July 2016, Petrolimex issued
National Petroleum Group (Petrolimex) was instituted the form of Joint Stock Company of Securities Trading Code Registration redeemable preferred shares to current
Corporation was the from the equitization and model from 1st December 2011 No. 35/2016/GCNCP-VSD of 25th April shareholders to raise the authorized capital
Gasoline and Oil Corpora- restructure of Vietnam National with Certificate of Business 2017 and “PLX” as ticker symbol. by 15%, from 11,388 billion VND to 12,938
tion which was set up by Petroleum Corporation pursuant Registration No. 0100107370. billion VND (rounded figures).
Decree No 09/BTN, issued to Decision No 828/QD-TTg
on 12th January 1956 by approved on 31st May 2011 by
The Ministry of Commerce The Prime Minister.
1995 2011 2012 2016 2017

Petrolimex was reestablished Petrolimex successfully held its initial Petrolimex officially became a On 26th May 2016, Petrolimex successful- On 21st April 2017, stocks of
pursuant to Decision No public offering (IPO) on Hanoi Stock public company as per document ly issued individual shares to Consultancy Petrolimex were listed on the
224/TTg, approved on 17th April Exchange (HNX) on 28th July 2017. No 2946/UBCK-QLPH of 17th and Holdings JX Nippon Oil & Energy HCM City Stock Exchange
1995 by The Prime Minister. August 2012 by the State Vietnam Co., Ltd., and raised the (HOSE) with ticker symbol PLX.
Securities Commission. authorized capital from 10,700 billion VND
to 11,388 billion VND (rounded figures).
16 PETROLIMEX
PETROLIMEX
3. SCOPE AND
LOCATIONS OF BUSINESS
3.1
SCOPE OF BUSINESS
FUEL CONSTRUCTION TRANSPORTATION

PETROLIMEX
Viet Nam National Petroleum Group
Wholesale of solid, liquid, gas fuel and Constructing other technical civil projects. Providing other supporting services relat-
related products. In details: wholesale In details: installation, repair, preservation ed to transportation. In details: renting and
of petroleum products, petrochemical of petroleum architectures, petrochemical leasing petroleum transportation vessels
products and related products products and civil projects
PETROLEUM PETRO- GAS

CHEMICAL
WATERWAY ROAD COMMERCE

TRANSPOR- TRANSPOR- AND SERVICE
TATION TATION
CONSTRUCTION,
INSURANCE BANKING MECHANIC,
EQUIPMENT
PETROL & OIL WHOLESALE SERVICE
Trading petroleum: Producing, distributing, Wholesale of machinery, equipment and Port leasing and storage of petroleum;
importing and exporting petrol and oil , other mechanical accessories. In details: Providing petroleum transportation ser-
machinery, equipment, accessories for pe-
implementing derivative instruments and vices
troleum and other industries
operations in accordance with international
practices for transactions and trading of
petroleum
18 PETROLIMEX
PETROLIMEX
3.2
LOCATIONS OF BUSINESS
12,286,325
IS A SALE VOLUME OF PETROL
M3, Tons
AND OIL IN 2017
Provinces and cities nationwide; There are Overseas: Single-Member Limited Liability
companies, branches and factories locat- Company located in Singapore, Laos and
ed in 63/63 provinces / cities; Representative Offices in Cambodia
2.500
RETAIL
COMPANY-OWNED
PETROLEUM STATIONS
5.200
SERVICE
STATIONS
14,000 stations
nationwide
154,000 BILLIONS
VND
Consolidated revenue
in 2017
20 PETROLIMEX
PETROLIMEX
4. CORE VALUES
BRAND VALUES BRAND PERSONALITIES
HERITAGE OPTIMISM
We always be-
lieve in a brighter
National pride
future
DIVERSITY HUMANITY ENTHUSIASM RESPONSIBILITY
We care about em-

We highly appre- We center our ployees, customers,
ciate difference activities around We love what the environment and
serving humanity
and diversity we do the surrounding com-
munity
We never stop
striving to inno- We always
vate and better keep our
ourselves “Promise”
DEVELOPMENT TRUST
22 PETROLIMEX
PETROLIMEX
5. GROUP AWARDS
5.1. 5.2.
GROUP AWARDS INDIVIDUAL AWARDS
Certificate of Merit from the The Second Labor Order

The First Class Independence The Second Class Labor Prime Minister awarded to awarded to the Chairman of
Order in 2015, 2016 Order in 2009 the Chairman of the Board of the Board of Directors in 2015
Directors in 2008 and 2016
Labor Hero Period Hero of the People’s

Ho Chi Minh Order in 2006 The Third Class Labor Order National emulation officer Certificate of Merit from the
Renewal in 2005 Armed Forces in 2006
awarded to the Chairman of awarded to the Chairman Prime Minister awarded to the
the Board of Directors in 2011 in 2009 General Director in 2014
Certificate of Merit from the TOP 500 largest enterprises

Prime Minister in 2011, 2014 in Vietnam
24 PETROLIMEX
PETROLIMEX
6. MANAGEMENT STRUCTURE
SUBSIDIARIES, • 45 Petroleum Subsidiaries (The Group (PTC) providing petroleum transportation
ASSOCIATED COMPANIES holds 100% of the capital) and 22 branch- services by road and trading petroleum.
es of which there are • 21 corporations/ companies (under the
»» 43 single-member limited liability ownership of Group with over 50 % capital
petroleum companies in Vietnam
»» 01 single-member limited liability or under control of Group)
company in Singapore • 14 joint-venture, associated companies
»» 01 single-member limited liability
GENERAL ANNUAL MEETING SUPERVISORY BOARD (The Group holds over 20 % authorized
company in Laos
• 02 subsidiaries that The Group holds capital).
100% of capital: Petrolimex Tanker Cor- (List of Corporations / Subsidiaries, Joint Ven-
poration (PGT) providing petroleum ture Companies, associated companies in
transportation services by sea; Petroli- the “Operation Network” section of the Group
BOARD OF DIRECTORS
mex Transportation Services Corporation website: http://www.petrolimex.com.vn.)
BOARD OF MANAGEMENT
CORPORATE OFFICERS 68 SUBSIDIARIES 14 JOINT-VENTURE, ASSOCIATED COMPANY
REPRESENTATIVE OFFICE
IN HO CHI MINH CITY 47 100%-PETROLIMEX 21 CORPORATIONS/
-OWNED COMPANIES COMPANIES
REPRESENTATIVE OFFICE
CAMBODIA
45 DOMESTIC
CORPORATIONS/ 01 PETROLIMEX
SINGLE-MEMBER CONTROLLED JOINT-
LIMITED LIABILITY STOCK COMPANY
COMPANIES
20 CORPORATIONS/
JOINT-STOCK
SINGLE-MEMBER COMPANIES
LIMITED LIABILITY
COMPANY IN
SINGAPORE
PETROLIMEX
SINGLE-MEMBER
LIMITED LIABILITY
COMPANY IN LAOS
26 PETROLIMEX
PETROLIMEX
Unit:
VND billion
7. FINANCIAL HIGHLIGHTS 6.000
Unit:
VND billion
CƠ CẤU LỢI NHUẬN TỪ HOẠT ĐỘNG KINH DOANH
5.000
6.000
RATE OF PROFIT AFTER TAX/ OWNER’S EQUITY (ROE)- PROFIT AFTER TAX/ TOTAL ASSETS (ROA)
30% 27.69 4.000
30% 27.69 5.000
22.06
22.06 17.13
20%
3.000
20% 17.13 4.000
9.43
10%
5.4 6.31 2.000
9.43
10% 4.18 3.000
5.4 6.31
2.08 2.55
4.18
0% 2.55
2.08
1.000
0% 2013 2014 2015 2016 2017
2.000
2013 2014 2015 2016 2017
Net profit margin ROA ROE
Net profit margin ROA ROE 0
1.000 2015 2016 2017
PROFIT OVER THE YEARS Petroleum Petrochemical Gas Insurance Transport services Other services
Unit:
VND billion 0
Unit:
7000
2015 2016 2017
VND billion
7000 6,300
6000 Petroleum Petrochemical Gas Insurance Transport services Other services
6,300
6000 5,147
5000 4,785
5,147 4,669
5000 4,785
4000 4,669 3,912
3,748
3,912 3,468 THE STRUCTURE OF PROFITS FROM THE STRUCTURE OF PROFITS FROM THE STRUCTURE OF PROFITS FROM
4000 3,748 3,058
3000 2,724 3,468 BUSINESS ACTIVITIES 2015 BUSINESS ACTIVITIES 2016 BUSINESS ACTIVITIES 2017
3,058
3000 2,724
2000
2000
1000
1000
0
0 2015 2016 2017
Profit before
2015tax
Profit before tax
Profit after tax
2016
Profit after tax
Profit of holding company's
2017 shareholders
Profit of holding company's shareholders 2015 2016 2017
FINANCIAL INDICATORS
ORDER INDICATIORS UNIT

2016 ACTUAL
RESULTS
2017 ACTUAL
RESULTS
COMPARISON 2015 2016 2017
1 2 3 4 5 6=5/4
Mil Petroleum 74,58% Petroleum 77,90% Petroleum 72,07%

1 Gross Revenue 123,096,517 153,697,057 125%
(VND)
Petrochemical 10,39% Petrochemical 5,21% Petrochemical 5,90%
Mil
2 Profit before tax 6,300,187 4,784,967 76%
(VND)
Gas 1,91% Gas 2,37% Gas 4,09%
Mil Petroleum 74,58% Petroleum 77,90% Petroleum 72,07%
3 Profit after tax 5,147,434 3,911,663 76%
(VND) Insurance 0,37% Insurance 0,35% Insurance 1,47%
Petrochemical 10,39% Petrochemical 5,21% Petrochemical 5,90%
Profit after tax of holding
" 4,669,396 3,468,270 74% Transport services 8,68% Transport services 8,01% Transport services 10,25%
company's shareholders Gas 1,91% Gas 2,37% Gas 4,09%
Profit after tax of non-managing Other services 4,08% Other services 6,17% Other services 6,22%
" 478,037 443,393 93%
shareholders Insurance 0,37% Insurance 0,35% Insurance 1,47%
Transport services 8,68% Transport services 8,01% Transport services 10,25%
Other services 4,08% Other services 6,17% Other services 6,22%

28 PETROLIMEX
PETROLIMEX
CONSOLIDATED NET REVENUE TOTAL ASSETS

(VND BILLION) (VND BILLION)
2017 marked a milestone while the Group officially listed 2017 is the third consecutive year that the Group has
shares on the Ho Chi Minh City Stock Exchange, entered the completed and exceeded the targets as planned, still
top 50 best listed companies in Vietnam, kept the champion remained the growth rate of petroleum output sold
of revenue. domestically.
30 PETROLIMEX
PETROLIMEX
OWNER’S EQUITY SALE VOLUME OF PETROL AND OIL

(BILLIONS DONG) (M3, TONS)
The group has outstanding success highlights such as fully Despite fluctuating world prices and abnormal global supply and
switched to E5 business; Initially deployed the organization demand, competition between re-exporters and policy changes,
of business Ron Ron gasoline level III, IV and switch to overall sectoral sales remained at 104% of the plan and 7% re-
trading level V. spective compared to 2016.
32 33
PETROLIMEX 5200 service stations / PETROLIMEX
14,000 stations nationwide
ANNUAL REPORT 2017 01. GENERAL INFORMATION 01. GENERAL INFORMATION ANNUAL REPORT 2017
PET
ROL
STA
TIO
NS
OPERATED
BY PGT
IMP
ORT
OPERATED BY
PETROLIMEX
WA PETROLEUM
TER SERVICES
COM 2500
WAY TERM
T PAN RET
STOR INAL AN
RAN Y–O AIL
SPO WN
RTA
TIO AGE D ED
N SYST TRA
GO EM NSP ROAD
ODS ORT
ATI
TRA TOT ON
NSP ROAD AL
ORT
ATI 570 PIPEL
ON KM INE
DOM
EST P
IC QUA ETROL
NG IME
NIN X
H
OPERATED
BY PETROLIMEX
TRANSPORTATION
SERVICE
CORPORATION
PETROLIMEX GROUP
PETROLIMEX INSURANCE PETROLIMEX
COMMERCIAL JOINT STOCK BANK
CORPORATION (PGI) AVIATION FUEL JSC (PA)
(PG BANK) PETROLIMEX
AVIATION FUEL JSC (PA)
Emirates Airline,
Singapore Airlines,
Etihad Airways,
Air France, Japan
DIVISION OF BUILDING, MECHANICS,
Airlines, United Airline
PETROLEUM EQUIPMENT, PETROLIMEX PETROLCHEMICAL PETROLIMEX GAS
EXPORT-IM- PORT AND CORPORATION (PLC) CORPORATION JSC. (PGC)
INFORMATION TECHNOLOGY
CÁC CON SỐ TIÊU BIỂU PLX
34 PETROLIMEX
PETROLIMEX
TOP 50 0,001S-V 50% 2.245.000m3
Petrolimex is one of the top 50 best Petrolimex is the first The market share of Total capacity of terminal
listed companies in Vietnam in energy corporation Petrolimex makes and storage system :
2017, leading the revenue distributing diesel 50% of the industry 2.245.000 m3
0.001S-V (EURO5) in
Vietnam.
570km 150.000 DWT

The only bonded petroleum
Petrolimex has total terminal qualified for 150.000
pipeline of 570 km DWT vessels, which owns a
fleet of 38,000 DWT
>30%
Petrolimex Petrochemi-
cals leads the industry
with over 30% market
share, exclusive asphalt
polymer products
5.200 15% TOP 5 30 BRANDS

Petrolimex has 5200 Petrolimex Gas is one of PJICO is the 5th largest Petrolimex Aviation Joint Stock
service stations over the five most prestigious in term of revenue Company (PA) is among the top
14,000 stations brands on the market in non-life insurance Vietnamese brands, providing fuel to
nationwide, 2400 retail terms of quality, being one company over 30 major airlines in the world
company–owned petrol of the three leading (United Arline, Eva Air, Emirates
stations뺭 companies in terms of Airline, Singapore Airlines, Etihad
sales, accounting for 15% Airways, Air France, Japan Airlines ...)
of sales in Vietnam.
36 PETROLIMEX
PETROLIMEX
9. DEVELOPMENT ORIENTATION
9.2. Restructuring to improve the operational efficiency under Resolution No 929 / QD-TTg
9.1. The Group operates over a variety of busi- becoming the instrument of the State to
MEDIUM AND LONG dated 7th July 2012 of the Prime Minister with the target of satisfying the production and
KEY OBJECTIVES ness fields, with its main business being stabilize macro-economic;
business plans and development investment in accordance with Resolution No 1117 /
petroleum trading, at the same time selec- • Continuously improving the quality of TERM DEVELOPMENT
QD-TTg dated 22nd August 2012 of the Prime Minister.
tively diversifying by investing in the petro- human resources, establishing the best STRATEGIES
leum trading business with core business working environment for employees;
operations surrounding petrochemical • Developing the management system in 9.3. Petrolimex always sees environmental of The Party and The Government: Grat-
protection as its responsibility and obliga-
products such as petrol, lubricants, bitu- order to improve competitiveness in the TARGETS FOR THE itude Fund, supporting Dong Van district
tion for the sustainable development of the (Ha Giang province) to “quick and sustain-
men, chemicals, gas ....in accordance with era of global economic integration; ENVIRONMENT AND
community, society and the Group itself. able poverty reduction” with many projects
the orientation of development: • Continuously improving the enterprise COMMUNITY
Petrolimex and its staff body with a sense on welfare and education the Resolution
• Being as an economic giant of the coun- value in order to maximize the sharehold-
of responsibility to the community and so- No. 30a / 2008 / NQ- CP dated 27th De-
try with the mission of business efficiency, ers’ value;
ciety have been participating and well or- cember 2008 of the Government.
adding values to shareholders, simultane- • Contributing to the development of com- ganizing social welfare programs through
ously fulfilling its political responsibilities munity and social benefits
a variety of action programs in order to ac-
to the State, ensuring energy security and
tively contribute to the community policies
38 PETROLIMEX
PETROLIMEX
9.4.
SWOT ANALYSIS
Strengths (S) Weaknesses (W) Opportunities (O) Threats (T)
• The Petrolimex brand is well known in both the domestic and • Prior to 2015, Decree No 84/2009 / ND-CP of the Government • Decree No. 83/2014 / ND-CP, promulgated and officially took • The ever more competitive environment due to the attractive-
international market with over 60 years of experience in trading on petroleum business coming into effect from 15th December effect on 1st November, 2014, helped enterprises trading petro- ness of the market leads to many potential threats to petroleum
petroleum. 2009 stated that petrol and oil price be decided by enterprises but leum, including the Vietnam Petroleum Group, to be better flexible enterprises in the form of the entrance of new domestic business-
• Owning the largest technical infrastructure among the petro- in fact, it was controlled by State decisions, putting enterprises in adjusting the price of petrol and oil in the country. Specifically, es and the expansion of established international companies. In
leum agencies in Vietnam with the modern and synchronous level in passive seat regarding petrol prices, hence affecting earnings. due to the mechanism dictating that two consecutive price ad- addition to the increase in the number of wholesale im/exporters,
up to the regional standards, including the port warehouses sys- During that period, the Group’s operating profit marginal, with no justments must be least 15 days apart should price be increased, the year 2015 marks the establishment of petrol and oil distrib-
tem with a capacity up to 2,200,000m3; pumping technology sys- accumulation for reinvestment, especially for large-scale invest- domestic petrol prices are more closely aligned with the world’s, utors as stipulated in Decree No. 83/2014 / ND-CP. Up to now,
tem, conveyance, distribution, measurement; more than 570km of ment projects. minimizing the risks from selling price’s being lower than the pur- there have been 29 importers and 69 petroleum distributors in
petroleum pipeline ... • The organizational structure is inflexible, slow in adapting to the chasing price due to that domestic oil prices was not adjusted the domestic petroleum market,competing against one another
• Especially, with the unique advantages of Petrolimex is the dis- changing market, hindering the process of innovation and devel- timely enough to the world oil prices as before. and competing directly with petroleum exporters and importers in
tribution system of nearly 5,200 selling points over the country, opment to improve the enterprises’ business efficiency • Demand for petroleum consumption continues to grow along terms of Petroleum retail price
of which are about 2,400 retailed petroleum stations owned by with the growth of the Vietnamese economy. The rapid growth in • Petroleum is under the State’s price stabilization initiative; The
Petrolimex, which has been constructed over the past 60 years. the number of transport vehicles - an average of 14.4% by 2020 price of petrol is not determined by the market forces due to that
All the stations carry massive commercial advantages in terms of - has caused a high demand for fuel, particularly for automotive State control petrol price to achieve other macro targets. Although
locations, and the brand reputation to achieve higher productivity fuels such as gasoline and diesel. In addition, the demand for liq- the price of petrol has been adjusted in line with the fluctuation of
than that of other social stations. In the market mechanism, this uefied petroleum gas as fuel for daily life, energy and agriculture world oil prices, however, the degree of adjustment of domestic
system has been bringing the highest profit for the company be- continues to grow steadily until 2025. It is estimated that by 2025, petrol price may not correspond to the that of world petrol price,
cause the Group has been collecting all the profit from the differ- the demand for petroleum in Vietnam up to an annual average of affecting the Group’s business
ence between buy-in cost and selling price. 4%. Therefore, the growth potential of the petroleum business is
• Large-scale operation of the Group with its subsidiaries, joint still promising in the near future, which is an opportunity for pe-
ventures, associated companies operating in the petroleum busi- troleum trading enterprises, including Petro Vietnam to increase
ness and the service field, contributes to the Group’s capital mo- their market share, ensuring enough supply to meet the demand
bilization and investment in big projects. for domestic consumption.
• Beside Petroleum - the main business, Vietnam Petroleum • The listing of PLX shares on the Stock Exchange will be an
Group also achieved satisfactory results in the key areas such as opportunity to increase transparency in the Group’s business and
petrochemical, gas, petroleum transportation, ... management operations, attracting investment capital and en-
hancing its position and image in Vietnam and the world.
40 PETROLIMEX
PETROLIMEX
10. RISKS
Petroleum and petrochemical products, Petroleum, petrochemical products are

being the main business items of the easy to cause fire and pollution in the pro-
Group, depends on the demand (growth) cess of preservation, transportation and
of the economy, including the influence of circulation. The Group always prioritizes
public investment policy. Therefore, busi- product, people and facility safety through
ness results (revenue, profit) are highly in- the promulgation of regulations and regu-
fluenced by the price in the global market larly inspects labor safety and fire preven-
and the regulation policies in the domestic tion to minimize risks.
market. Exchange rate fluctuation and the In addition to the risks posed to Petroli-
State’s policies to control exchange rate mex’s operating businesses, Petrolimex
also affect the business efficiency due to as well as other economic units will be
the fact that the petroleum import demand affected and will suffer losses if there are
still accounts for a large proportion, about unforeseen risks such as natural disasters
70%. or fires. This will cause damage to proper-
The standards of the commodity line, while ty, people and general operation of Petro-
gradually fulfilling requirements in this era limex as well as other enterprises in the
of economic integration, pose many chal- economy.
lenges and risks that may directly affect
the business of enterprises.
42 PETROLIMEX
PETROLIMEX
10.1. Economic development is normally eval- biggest crude oil exporting countries. Be- 10.1.2. Economic growth rate in Viet- nam outdid the plan of increasing the eco- ence enterprises’ business operations,
ECONOMIC RISKS uated by economic growth rate, inflation sides, there has not been any sign of re- nam nomic growth rate by 5% in 2009 although especially enterprises in petroleum trading
changes, interest rates or exchange rate duction of tensions between Russian and it was lower than 2008 economic growth industry easily affected by macro factors.
fluctuation, etc....These are the factors Western Europe causing economic losses Economic growth rate is one of the most rate by 5.7%. Gross estimation of period Therefore, Government’s effective macro
systematically affecting the economy. Ex- for both sides. European economic has important factors affecting to the growth 2009-2011 has shown that average GPG policies are one of key factors to reduce
traordinary changes of these factors might not been overcome difficulties while facing rate of almost other economic industries. growth reached at 6,0%. As of 2012, glob- economic risks for enterprises in general
cause risks for economic subjects in gen- with migrant crisis from Middle East, North In general, economic growth leads to so- al economic faced with recession risks, and enterprises trading petroleum in par-
eral and for Vietnam National Petroleum Africa, terror attack rising and withdrawal cial demands, raises the industrial output especially European debt crisis making a ticular.
Group in particular. of the United Kingdom from the European and provides enterprises with an oppor- huge impact on economies, including Viet-
Union (Brexit), etc. The prospects of new tunity for expanding their market. In the nam. However, Vietnamese GDP growth
10.1.1. Global economic growth pros- emerging markets and developing econ- recent years, Vietnam has ever closely rate reached at 5.2% in 2012. Up to now,
pects omies witnessed the ever slower pace of kept pace with global development trends. the rising trend of economic growth rate
growth in the last consecutive 5 years. Joining WTO means that Vietnamese im- has returned despite the slight decrease
International Monetary Fund (IMF) con- According to the report “Global Economic port and export might reach global mar- by 6.2% in 2016 compared with 6,6 % in
siders that the global economic is being prospects” issued on January, 2017, IMF kets excluding bilateral treaty and region- 2015. Moving on to 2017, Vietnam set the
inhibited by these factors as low productiv- prediction of global economic growth rate al agreements. Regarding import, being target of 6.7% in GDP growth rate seeing
ity, population aging, undefined prospects in 2017 would be 3.4 percent as reported the member of WTO brings Vietnamese the Government’s determination in sus-
when the USA raised the interest rate and in October, 2016, at the same time warn- people advantages of quality goods with taining the sustainable growth rate to build
steady trend of Chinese economy - the ing about the rising instability in relation to competitive prices leading to benefits in a solid foundation for the development of
second biggest one in the world that sig- protectionism and policies of new Ameri- consumption. Especially, enterprises im- economic sectors and make a positive im-
nificantly affected to commodity market can authority. porting technologies and input materials pact on business operations of public list-
and money market in 2016. and trading enterprises obtain the benefits ed organizations. Nevertheless, long term
The oil price reached the bottom in the in production and business activities. economic prospects frequently go along
last 11 years, making negative impacts on After officially being WTO member, Viet- with potential variations that might influ-
44 PETROLIMEX
PETROLIMEX
10.2. The system of legal documents regulating of being perfected, and changes in policy put of petroleum. This is an essential item gasoline prices down by VND2,050 per li-
RISK OF LAW the production and business activities of are likely to affect the Group’s manage- in the price stabilization list. ter (down 10.29%). 1,420 VND / liter (down
enterprises is the legal corridor for enter- ment and business. Since the end of 2009, domestic petro- 7.7%), kerosene was 1,570 VND / liter
prises in all their activities. Vietnam Oil In order to control the legal risk, the Group leum prices have been operating under the (8.3%) and mazut oil was 1,690 VND / liter
and Gas Group operates under the model always updates the legal environment re- market mechanism and the State and the (down 11.4%). Although petrol prices have
of a joint stock company and all activities lated to the Group’s activities, thereby de- State management continue to use finan- been adjusted in line with the fluctuation of
of the Group are governed by a system of veloping a suitable business development cial instruments such as tax and price sta- world petrol price, however, because petrol
legal documents including the Law on En- plan. bilization funds to regulate petrol prices in is the item in the management and price
terprises, the Law on Securities, legal doc- order to stabilize the macro-economy and stabilization of the State, the increase /
uments and related circulars. Laws and avoid negative impacts of petroleum price decrease of gasoline prices. domestic oil
regulations in this area are in the process fluctuations on the economy. in many time not in the same trend or ad-
justed range does not correspond to the
During this period, petrol prices were increase and decrease of world oil prices.
10.3. The Group’s operations involve the petro- By the end of September, the Organization continuously adjusted up and down with
RISK FACTORS leum sector. The Group is exposed to a of Petroleum Exporting Countries (OPEC) different ranges, the lowest price in this On 15th October 2009, Decree No. 84/2009
number of specific risks: agreed on a first production cut in eight period for A92 gasoline was VND 11,000 / ND-CP officially came into effect and ef-
years. Oil ministers said OPEC agreed to / liter (in the first quarter of 2009) and fective from 15th December 2009. This is
10.3.1. Risk of fluctuation of petrol price limit the group’s output to 32.5 to 33 mil- high VND 10,000 / liter (March 2009) and an important legal premise for Vietnam’s
lion barrels per day, down 750,000 barrels VND23,310 / liter (July 2013), respective- petroleum market to reflect the trend of
In the period from 2000 to now, world oil from OPEC output in August. This, the ly, for oil VND 13,000 / liter (January and world petrol prices, asymmetric market ap-
prices have seen many price levels and price of oil immediately skyrocketed. North March 2010) and VND 19,200 / liter (April proach but with the management and su-
succession is broken to establish new Sea crude for London traded up 6.5 per- and March). / 2012). The biggest increase pervision of the State. However, the man-
ground due to global economic crisis and cent to USD 48.96 a barrel. Oil prices con- was in gasoline at VND2,900 / liter (up agement and management of petroleum
political instability of the exporting coun- tinue to stabilize above USD 50 a barrel 17.7% y / y), diesel at VND3,550 / liter (up business has revealed many unreasonable
tries. oil. Between 2008 and 2009, oil pric- until now. With the expectation that OPEC 24.07% ), kerosene at VND 3,100 / liter issues, so on 3rd September 2014, the
es lost nearly two-thirds, reaching USD 32 countries will continue to have a consen- (up 20.53%) and mazut oil at VND2,100 / Prime Minister signed Decree No. 83/2014
a barrel in December. This is the time when sus in keeping oil prices as they are now, liter (up 16.62%). In 2014, the biggest fall / ND -CP on petroleum trading replaces De-
the world experienced the economic crisis, it is expected that oil prices will be less in price was in the downward adjustment cree No. 84/2009 / ND-CP and takes effect
stemming from the subprime mortgage volatile in 2017. However, with the election of gasoline prices on Dec. 22, 1414, with from 01/11/2014. Decree 83/2014 / ND-CP
crisis in the United States. Reducing pro- of new US President Donald Trump, many
duction helped oil prices rebound in early new economic policies are likely to have a
2009. By the end of June, prices had risen big impact on oil prices, making oil prices
above USD 73 a barrel. In Libya’s produc- continue to be volatile.
tion shutdown in 2011, prices jumped 35% The continuous fluctuation of gasoline
in the first three months to USD 127 a bar- prices in the world will affect the business
rel. The second peak was set in February of petroleum trading companies in gener-
2012, after Europe imposed a series of al and the Group in particular. The petrol
trade sanctions on Iranian crude. Between business operates under the State-con-
2015 and 2016, global supply surpluses trolled market mechanism, allowing Petro-
due to the shale oil outbreak in the Unit- limex’s price strategy to become more flex-
ed States have plagued oil prices since ible in response to fluctuations in world oil
mid-year 2014. Last year, global crude oil prices, affecting the plan business.
lost more than 30% and only earlier this
year lost 20% . In mid-2014, a barrel of oil 10.3.2. Risk of petrol prices management
will cost USD 110. Oil subsequently fell to
USD 30 an ounce in the context of weak Petroleum is a national strategic commod-
demand and supplies from Iran that were ity and closely monitored by the State, es-
about to enter the market after internation- pecially in terms of price, quality and out-
al sanctions were lifted.
46 PETROLIMEX
PETROLIMEX
has created favorable conditions for Viet- 10.3.3. Risk of fire and environmental 10.4. After being approved for listing, PetroViet- Negative fluctuations in the Group’s share
nam’s petroleum market to have access to pollution RISK OF CHANGES IN THE nam shares will be officially traded and price may affect the brand or reputation of
the regional and world petroleum market. stock prices will be determined based on Petrolimex as well as may cause damage
SECURITIES MARKET
Accordingly, the petrol business continues Petrol and oil products are likely to cause market supply and demand. Post-listing to its shareholders. However, with the par-
to operate under the market mechanism fire and explosion and may cause great prices will be influenced by the overall situ- ticipation of two major shareholders, the
under the management of the State, pro- damage to petrol and oil trading companies ation of the Vietnamese stock market. The Ministry of Industry and Trade and JX Nip-
mote business autonomy of the business if they arise in the course of preservation, Group’s shareholders will be exposed to pon Oil & Energy Vietnam Co., Ltd. with
in accordance with the law. To ensure the transportation or circulation. However, this the Group’s volatility in price movements. total ownership of 83.8% of total shares
good performance of the inspection and risk can be controlled if the regulations In addition to the business situation of the of Petrolimex This will help Petrolimex’s
supervision role of the State management on occupational safety, fire and sanitation Group, there are other factors that may af- share price limit risks of price volatility.
agencies, the harmonization of interests of are strictly followed. Vietnam Oil and Gas fect Petrolimex’s stock price, such as the
consumers, enterprises and the State. The Group always attaches great importance overall socio-economic situation, direct or
competitiveness, publicity and transparen- to safety and fire prevention, property in- indirect effects of the change. Modifying
cy in the petrol business shall be strength- surance, fire and explosion, community re- securities laws or other unforeseen events.
ened in parallel with the strict management sponsibility, environmental protection, etc.
of the petrol and oil distribution system, To improve and modernize port warehous-
10.5. Owning more than 68 subsidiaries, joint ventures and joint ventures across the country
ensuring the stable supply of petrol and oil es, petroleum pipelines, raise the safety
in the system, ensuring the quality of petrol coefficient in exploiting and exploiting,
RISK IN MANAGEMENT and neighboring countries, also makes the risk of management of the Group. However,
with the experience gained so far, besides, the Group has great support on the manage-
and oil. through the market. Domestic pet- organizing propaganda for the law on fire
ment of JX Nippon Oil & Energy Holdings Limited and one member of Vietnam JX Hold-
rol prices reflect timely changes in world prevention and fighting, training and train-
ings Group - Japan’s number one energy company with years of experience in the market
petrol and oil prices; Frequency, petrol ing for staff members.
development and corporate governance transformations will help Petrolimex reduce the
price adjustment range suitable with the
risk of management and administration.
socio-economic development, consumer
psychology. Biofuels are encouraged to
reduce dependence on fossil fuels and to 10.6. In addition to the specific risks associated with the petroleum business, the Group, as
help protect the environment. OTHER RISKS well as other economic entities, will be affected and will suffer losses if unavoidable risks
occur. Unforeseen risks such as earthquakes, natural disasters, floods, fires, wars, epi-
demics, terrorism, etc., will cause damage to property, people and the general situation of
Group as well as other businesses in the economy.
02. BUSINESS
PERFOMANCE
IN 2017
1. Production and business performance

2. Organization and human resources
3. The Investment and Implementation of
projects
4. The Group’s Consolidated financial
performance
5. Shareholders’ structure, owner’s equity
changes
PETROLIMEX
TRANSPORTATION
50 PETROLIMEX
ANNUAL REPORT 2017 02. BUSINESS PERFORMANCE IN 2017 02. BUSINESS PERFORMANCE IN 2017
PETROLIMEX
1. PRODUCTION AND
BUSINESS PERFORMANCE
6.81 % After attaining an impressive production and The traded volume of Petroleum products
business results in 2017, the Group begins was under targets for the first 6 months, but
its execution of 2017 plan under great pres- compensated by a high growth in the last 6
GDP growth over the year, sure due to the absence of existing advan- months (especially from the intermediaries)
exceeding the target set 6.7% tages, while the market competition is get- to finish the fiscal year exceeding the tar-
ting ever more aggressive with incessantly gets.
increasing number of agencies and dealers
distributing Petroleum; the tax - rate struc- Decree No 83/2014/NĐ-CP’s fully executed
ture of average import tariff in the base price and the world price of petroleum’s closely
was not enough, leading to the undervalu- monitored by the Interministry work to con-
ation of basic(base) price as great as 100 trol the domestic petroleum market. Also
50
VND per liter in some cycles, etc; along with within this year, the Ministry of Industry and
the transition to E5RON92 (E5) and Diesel Trade and the Ministry of Finance collaborat-
ed to 23 times adjust the price of petroleum
TOP
at level V (DO-V), account for a heavier
23 times
workload. products including: Petrol - 20 times (10
times increasing and 10 times decreasing),
From the beginning of the year, the Group Diesel - 22 times ( 15 times increasing and
is the number of times has synchronically and drastically execut- 7 times decreasing), Mazut - 22 times (15 VIETNAMESE
ed proposed solutions, closely following times increasing and 7 times decreasing),
adjusted prices of petro- COMPANIES LISTING
leum products, of which: changes in the market as well as the Gov- kerosene - 21 times (14 times increasing
Gasoline 20 times; 22 ernment’s Macroeconomics policies; timely and 7 times decreasing). At the same time, IN 2017 RESULTS OF PRODUCTION AND BUSINESS ACTIVITIES IN 2017
times; Mazut 22 times and brought forward many suitable and effective the Interministry has flexibly utilized BOG 17
solutions for every market segment, every times to adjust the expenditure limit. There- Benchmark
Kerosene 21 times Actual results
comparison
unit and every period, quarterly review- fore, the subsidy has been almost stable at Or-
Criterion Unit 2017 target 2017
ing production and business results to re- 300VND per liter, kilogram (E5 was an ex- der
2016 2017 2016 plan-
solve any problems, especially in divisions ception and petroleum was not subsidized in ning
of decreasing profit and output, in a timely the first 15 days of January 2017)
100,000
A B C 1 2 3 4=3/2 5=3/1
manner to ensure production and business BILLION
results’ ability to catch up with the targets. The foreign currency supply was abundant VND Traded Volume of
and fairly stable with the fluctuation in ex- 1 Petroleum products m3 11,823,300 11,441,858 12,286,325 107% 104%
Furthermore, the following favorable factors change rate’s being lower than the predic- is the capitalization of the (*)
of the macroeconomics environment, which tion. Group by the end of 2017
Consolidated Billion
2 143,208 123,097 153,697 125% 107%
were of a upward trend quarterly in 2017, revenue VND
were conducive for the Group’s production 2017 has passed with relatively satisfacto- Consolidated be- Billion
153,697
ry results in production and business with 3 4,680 6,300 4,785 76% 102%
and business: BILLION fore-tax earnings VND
all targets met or exceeded, especially for VND
4 Dividend yield % 12% 32,34% (**)
The domestic economics gradually improve, the output level. Moreover, 2017 was also a
is the consolidated revenue,
GDP all each quarter surpassed the previ- milestone when the Group was officially list-
holding the top in terms of
ous (ones). Besides, GDP growth of the ed on the HCM Stock exchange. Moreover, (*) The traded volume of petroleum products includes: domestically trading,
revenue
whole year has reached at 6.81 percent ex- the Group has been listed in the Top 50 best re-export, export, outputs from Petrolimex Aviation (PA) JSC, Laos Petrolimex,
ceeding the defined target at 6.7 percent. listed companies with the Group’s revenue excluding Singaporean Petrolimex’s traded volume of crude oil.
in the first place. Up to now, the Group’s
The oil price has been in a downtrend for the (market capitalization) is approximated at (**) As the General Annual meeting has yet to take place to approve the 2017
first 6 months, but from July the uptrend has 100 trillion VND at the moment paid dividends
affected partly to Group’s Petroleum sales.
52 PETROLIMEX
PETROLIMEX
2. ORGANIZATION AND
HUMAN RESOURCES
2.1.
BOARD OF MANAGEMENT
Mr. PHAM DUC THANG Mr. VUONG THAI DUNG Mr. TRAN NGOC NAM
General Director Deputy General Director Deputy General Director
Year of birth 1961 Qualifications Year of birth 1958 Year of birth 1965
Master degree in Economics
Hometown Hometown Hometown
Binh Minh, Kien Xuong, Thai Binh province Political Qualifications Advanced Huong Ngai, Thach That, Ha Tay province Hai Phuc, Hai Hau, Nam Dinh province
Current address Foreign Language English Current address Current address

Hai Ba Trung district, Ha Noi Dong Da district, Ha Noi Long Bien district, Ha Noi
Qualifications Qualifications
Construction Engineer Bachelor Degree in Economics
Political Qualifications Advanced Political Qualifications Bachelor
Foreign Language English

54 PETROLIMEX
PETROLIMEX
Mr. NGUYEN QUANG DUNG Mr. NGUYEN VAN SU Mr. DAO NAM HAI Mr. LUU VAN TUYEN
Deputy General Director Deputy General Director Deputy General Director Chief Accountant
Year of birth 1972 Year of birth 1966 Year of birth 1974 Year of birth 1969
Hometown Hometown Hometown Hometown

Nam Dinh province Nghe An province Hai Phong province Dong Hung, Thai Binh province
Current address Current address Current address Current address

Thanh Xuan district, Ha Noi Dong Da district, Ha Noi Thanh Xuan district, Ha Noi Thanh Xuan district, Ha Noi
Qualifications Qualifications Qualifications Qualifications

Master degree in Chemical Engineering Master degree in Business Administration, Mechanical Engineer Master degree in Business Administration, Master degree in Law Master degree in Economics, Bachelor degree in Accounting
Political Qualifications Bachelor Political Qualifications Advanced Political Qualifications Advanced Political Qualifications Advanced
Foreign Language English Foreign Language English Foreign Language English Foreign Language English
56 PETROLIMEX
PETROLIMEX
2.2. 2.3.2 Policies to laborers
TURNOVERS IN BOARD OF MANAGEMENT Working regulations Working condition: The Group always facili- Training manner: Supporting training fee
tates employees with best working condition. for employees, with the orientation to set
Working hours: 8h per day, 5 days per week. In details: employees are well-equipped. up courses to improve professional skills.
Name Job title Appointed date/ Dismissed date When having to boost progress in produc- Moreover, labor safety is always prioritized. Creating the spirit of training goes along with
tion and trading, laborers might be request- creativity, supporting the Group’s long-term
Tran Van Thinh General Director Retired from November 1st, 2017 ed to work over-time in return for satisfactory Recruiting policy development.
remuneration from the Group.
Pham Duc Thang General Director Appointed from November, 1st, 2017 Having aware of the labor force importance Remuneration policy
National holiday and annual leave: the in the development process, the Group pays
Nguyen Quang Kien Deputy General Director, Member of the Board of Directors Retired from October, 1st, 2017 Group’s employees have national holidays due attention to the recruiting, training and Salary paid to employees complies with the
and annual leave in accordance with State’s developing labor force. There has been State’s regulations and the Group’s salary
Vu Ba Phu Deputy General Director Work Transferred from November, 27th, 2017
regulations. Employees working enough many policies to attract talents and facilitate, policy. Salary and bonus are based on busi-
12 months or more have 12 days of annual support in terms of time those having desire ness efficiency, job title and salary policy
Nguyen Van Su Deputy General Director Appointed from April, 1st, 2017
leave. The additional annual leave days are of studying and improving their professional stated by the State and the Group to raise
Nguyen Quang Dung Deputy General Director Appointed from April, 1st, 2017 determined by seniority. Those with 5 years’ and competence skills. employees’ activeness and creativity..
seniority have one more day-off. Those with
Dao Nam Hai Deputy General Director Appointed from October, 1st, 2017 under 12months’ seniority will have the day- Training policy
offs equivalent to the number of working
Recruiting criteria and goals: The Group’s
months in a year.
recruiting goal is toward specialized skill in
Sickness and maternity leave: Employees all areas. The Group always encourages
2.3. when being absent for sickness and mater- employees to improve their professional
skills to ensure fulfilling their tasks.
NUMBER OF EMPLOYEES AND HUMAN nity will receive allowance from Social Insur-
ance Fund according to Labor Law.
RESOURCES POLICIES
2.4. THE ANNUAL GENERAL MEETING

2.3.1 Total number of employees and By December, 31st, 2017, there have been VND 9,839,000 per person in one month, FUNCTIONAL BOARDS AND
average income 24432 employees in total, including 18274 increasing 17 percent compared with 2016 DEPARTMENTS
employees in Sales Department. Compared (8,389,000VND per person in one month). SUPERVISORY
with the period of January 1st, 2017, the ac- In details, VND 7,880,000 per person per GENERAL DIRECTORS
tual number has increased by 148, though month was sourced from the 2017 salary
331 short of target. fund and the remaining VND 1,958,00 per
person per month was sourced from the sal-
Retail productivity per estimated an average BOARDS UNDER BOARD OF DIRECTORS
ary fund of 2016. BOARD OF MANAGEMENT
station worker of the whole industry in 2017 - General Administration Board
was 35.5 m3 /labor per month, seeing a The 2017 average income was higher than - Strategy and investment department
2.3% increase compared with average pro- 2016 because in 2017 the Group was ap- - Audit department
ductivity in 2016 (34.7 m3/ labor per month) proved to adjust salary fund proposal at the - Department of human resources, wages and
end of the year. Therefore, the remaining bonuses
In 2017, the average earnings of companies amount of the 2016 salary fund was rolled
was about VND 11,141,000 per person per over to 2017 fund, a larger amount com-
month, increasing 19 percent compared with pared with previous years. GROUP’S DEPARTMENTS AND DIVISIONS:
- GROUP’S LABOR UNION GROUP’S REPRESENTA-
2016 while the average wage was about - Financial and Accounting Board
TIVE OFFICE
- Export-Import Department - PARTY COMMITTEE
- HCMofice
- Sales Department
- Cambodian office
- Marketing and International Relations De-
partment
- Technical Petroleum Department
- Technical Technology and Safety Depart-
Employees Employees VND/employee/month ment
25,026 18,126 11,141,000 - Information and Technology Department

- Construction Investment Department
- Legal Affairs and Inspection Department
Total number of employees in the Group on Number of employees in Average actual income in 2017 - Public Relation Department
December 31st, 2017 Petroleum business - Human Resources Department
- ERP administration Department
- Bureau
Source: Vietnam National Petroleum Group
58 PETROLIMEX
PETROLIMEX
Financial and accounting board
Consulting General Director in commanding,

Consulting General Director in managing
and operating the measuring and forwarding
operations, petroleum quality and wastage
the Group’s leader.
Public Relation Department

3. THE INVESTMENT AND
managing and operating the accounting and
finance within the Group in accordance with
current law and the Group’s regulations.
as well as Group’s product strategy.
Technical Technology and Safety De-

Consulting General Director in commanding,
managing and operating the constructing,
IMPLEMENTATION OF PROJECTS
partment using and managing brand and protecting
Export - Import Department prestige, image and status of the group in
Consulting General Director in managing Vietnam and in the world in accordance with
Consulting General Director in managing and operating the orientated development of brand development strategy of the Group.
and operating the petroleum source gener- technical infrastructure strategy; research-
ating (including the amount purchased from ing, developing and renovating technology Human Resources Department
domestic petrochemical, filtering factories – equipment toward modernization, auto-
and those imported); exporting petroleum Consulting General Director in command-
mation; and applying technical and scientific
(even re-exporting) and trading international ing, managing and executing the organizing
progress in petroleum business; managing,
petroleum (overseas business) meeting the of staff, labor – salary, training, immigrating
effectively exploiting, ensuring fire safety and
Group’s business need. and sanction within the Group.
occupational health and safety, protecting
the environment, avoiding natural disaster to ERP administration Department
Sales Department
infrastructure; managing the standardization
Consulting General Director in command- and scientific research within the Group. Consulting General Director in operating
ing, managing and operating sales plans, and effectively applying ERP – SAP system
Information and Technology Department invested by the Group.
expanding domestic petroleum market pur-
suant to Law, assuring efficiency, strategy Consulting General Director in managing Bureau
and the Group’s growth targets; Orientat- and operating the orientation of development
ing development, managing and operating strategy, defining investment scope and ex- Consulting General Director in commanding,
petroleum transport in accordance with the ecuting information technology application, managing and executing: foreign affairs, so-
Group’s means of transportation, including telecommunication, automating information cial policies, Group’s emulating – rewarding
land, railway, waterway and tube facilitated system; effectively exploiting infrastructure , administration, accounting and military -
at member companies and other enterprises system (software, hardware) and communi- defence within the Group.
capitalized by the Group to meet the need of cation system within the Group.
petroleum transportation within and outside
the Group, corresponding the global and re- Construction Investment Department
123
gional development trend.
Consulting General Director in managing
Marketing and International Relations and operating investment and construction The capital funding equity investment proj- Besides, more than 250 Petroleum stations
Department in accordance with the State’s and Group’s ects was mainly from equity capital. Group were renovated and expanded. Brand rec-
regulations, meeting the need of production A and group B projects were not included ognition of urban stations and highway sta-
Consulting General Director in researching and business operations within the Group. in investment, execution and transferring tions were developed to boost sales.
and managing domestic and overseas mar- NEW PETROL projects, while group C projects primarily
ket and international relations Legal Affairs and Inspection Department consisted of newly constructing and rebuild- In order to promote the Petroleum chain sta-
STATIONS THAT ing Petroleum stations; upgrading storages, tions, “Development of retail chain” confer-
Technical Petroleum Department Consulting General Director in managing HAS INVESTED wharves, Petroleum transports; renovating ence was held on January 11th, 2018 to dis-
and executing the activities of legal affairs offices, copyright and management soft- cuss and propose guidelines, policies and
within the enterprise and the inspection of wares., etc mechanism so that the Group could make
a breakthrough in network development in
The Group has invested in 123 new Petro- 2018 and the following years.
leum stations, putting 84 Petroleum stations
into operation which exceeded target count Pursuant to Resolution No. 53/2012/QD-
by 24. This was the highest number of Petro- TTg regarding mixing traditional fuel an bi-
84 leum stations that come into operation with- ology fuel, the Group equipped itself with E5
PETROLEUM STATIONS
INTO OPERATION in the last 5 years. The average output of in-line and in-tank petrol mixing system (at
these Petroleum stations was approximately Nha Be storage, K130, Thuy Port, Phu hoa),
which was the highest used in collaboration with the synchronized
130 m3 per month in one station, especial-
number of petrol stations technological system of VPT, to generate
ly there were several stations with average
in the last 5 years enough E5 to completely replace Ron 92.
monthly output reaching 800 m3 (Store 39
- Quang tri). Subsidiaries with many stations
The total investment value in 2017 was
set up in 2017 include Phu Khanh (9 stores),
1,491 billion VND, 103 percent of target,
B12 (6 stores), Southwest area (5 stores),
which increased 42 percent compared with
Thanh Hoa, Ha Tinh, South Central High-
that in 2016
lands, Quang Ngai (3 stores for each)
60 PETROLIMEX
PETROLIMEX
THE INVESTMENT AND IMPLEMENTATION OF PROJECTS
2017 TARGET 2017 ACTUAL RESULTS

4. THE GROUP’S CONSOLIDATED
OR-
DER
PROJECT
QUANTITY
VALUE
(BILLION VND)
QUANTITY
VALUE
(BILLION VND)
FINANCIAL PERFORMANCE
1 Constructing new Petroleum stations 50 530 84 817
2 Renovating Petroleum stations 196 304 250 248
3 Expanding & upgrading storage, reserves, quays 65 87 4.1.

FINANCIAL PERFORMANCE
4 Gasoline dispenser, Informatics and automation, Egas 220 232
5 Purchasing and repairing equipments 120 52

THE FINANCIAL STATEMENTS HAS
6 Others 210 55
BEEN AUDITED BY KPMG COMPANY
10 Total 1,449 1,491
Unit:
VND billion 2016 Actual results 2017 Actual results
175,000
153,697
150,000
123,097
125,000
100,000
75,000
61,790
ELECTRONIC INVOICE 50,000
54,244
25,000
From 0h 01.04.2018 Petrolimex Vietnam officially
issued electronic invoices to replace the issuance 6,300 4,785 5,147 3,912
of ordinary paper bills. 0
Net Revenue Profit before tax Profit after tax Total assets
The issuance of electronic invoices is an FINANCIAL PERFORMANCE

indispensable trend, reducing the burden
on administrative procedures, creating fa- OR- 2016 ACTUAL 2017 ACTUAL
CRITERION UNIT COMPARISON
DER RESULTS RESULTS
vorable conditions for consumers, reduc-
ing the cost of doing business. In addition, 1 2 3 4 5 6=5/4
the State management agencies will also
Mil
facilitate the search for information to con- 1 Net Revenue 123,096,517 153,697,057 125%
(VND)
trol. This is a program that benefits both
the consumer, the state and the business. Mil
2 Profit before tax 6,300,187 4,784,967 76%
(VND)
Member of BOD - Deputy General Mil
3 Profit after tax 5,147,434 3,911,663 76%
Director, Head of Project of Petrolimex (VND)
Electronic Invoice
Profit after tax of parent company’s shareholders “ 4,669,396 3,468,270 74%
Mr. Tran Ngoc Nam
Profit after tax of non-managing shareholders “ 478,037 443,393 93%
Mil
4 Total assets 54,244,434 61,769,061 114%
(VND)
62 PETROLIMEX
PETROLIMEX
4.2.
IMPORTANT FINANCIAL RATIOS 5. SHAREHOLDERS’ STRUCTURE,
OWNER’S EQUITY CHANGES
SOLVENCY INDICATOR CAPTIAL STRUCTURE INDICATOR PROFITABILITY RATIOS
Unit: 2016 2017 Unit: 2016 2017 Unit: 2016 2017

Times Times %
27,69 5.1.
1,2 1,19 2,0 25 STOCKS
1,13
1,64
1,0
0,89
20
1,5 Name of Shares
0,77 1,33 Type of shares Par value
0,8 17,13 VIETNAM NATIONAL PETRO-
15 LEUM GROUP - PETROLIMEX ORDINARY SHARES 10,000 VND PER SHARE
0,6 1,0
10 9,43 Book value as of December,

0,4 0,62
0,57 Total shares in circulation Amount of free stock 31st, 2017
0,5 6,31 1,293,878,081 SHARES 1,293,878,081 SHARES 17,707 VND PER SHARE
0,2 5 4,18
2,55
0 The number of shares as of
0 Of these
0 December, 31st, 2017 COMMON STOCK PREFERRED STOCK
Current Ratio Quick Ratio
1,293,878,081 0
Debt ratio/ Debt ratio/
1,293,878,081 SHARES SHARES SHARES
total asset owner's equity Profit Profit Profit
margin/ margin/ margin/
Net Return on Return on
revenue Equity Assets
(ROE) (ROA)
FINANCIAL RATIO 2016 2017 NOTE

5.2.
SHAREHOLDER’S STRUCTURE ON
1. Solvency
DECEMBER 31ST, 2017
A. Liquidity ratio (times) 1.19 1.13
- Quick ratio (times) 0.89 0.77
2. Capital structure
C. Debt ratio (times) 0.57 0.62

Ministry of Industry and Trade 75.87%
D. D/E ratio (times) 1.33 1.64 Vietnam Petroleum Group 10.44% DOMESTIC
3. Efficiency ratio SHAREHOLDERS
Union 0.39%
E. Inventory turnover (turn) 13.41 13.16 Other domestic individuals and organizations 2.93%
F. Asset Turnover ratio (times) 2.26 2.49 X Nippon Oil & Energy Vietnam 8.0%
FOREIGN
SHAREHOLDERS
Other international individuals and organizations 2.36%
4. Profitability ratio
G. Profit margin 4.18% 2.55%
H. Return on Equity (ROE) 27.69% 17.13%
I. Return on Assets (ROA) 9.43% 6.31%

64 PETROLIMEX
PETROLIMEX
SHAREHOLDER NUMBER OF SHAREHOLDERS OWNERSHIP HOLDING PERCENTAGE
A. Domestic
1. Individual
Of these: 9,405 28,895,813 2.23%
- Internal and relatives of internal 24 139,133 0.01%
2. Organization 50 1,130,827,632 87.4%
Of these:
- Ministry of Industry and Trade 981,686,626 75.87%
- VietNam National Petroleum Group 135,064,846 10.44%
- Trade Union 5,000,000 0.39%
- Other organizations 9,076,160 0.70%
Total domestic (I) 1,159,723,445 89.63%
B. Foreign
1. JX Nippon Oil & Energy VietNam 1 103,528,476 8.00%
2. Other organizations 76 30,324,210 2.34%
3. Individuals 73 301,950 0.02%
Total Foreign (II) 134,154,636 10.37%
Total (I)+(II) 1,293,878,081 100.00%
5.3. 5.4.
CHANGE IN OWNER’S EQUITY OTHER SECURITIES
The total treasury stock as of December, 31st, None

2017: 135,064,846 shares
The transaction of treasury stocks: In this year,

the Group has sold 20,000,000 shares of treasury
stocks from May 4th, 2017 to May, 23rd, 2017 at
50,533VND per share (average transaction price)
03. MANAGEMENT
BOARD’S REPORT
AND EVALUATION
1. Evaluation on production and business

performance
2. Financial situation
3. Improvements in structure, policy and
management
4. Proposed plan for 2018
PETROLIMEX
WATERWAY
TRANSPORTATION
68 PETROLIMEX
ANNUAL REPORT 2017
03. MANAGEMENT BOARD’S
REPORT AND EVALUATION
PETROLIMEX
1. EVALUATION ON PRODUCTION AND

BUSINESS PERFORMANCE
PETROLIMEX’S
0.001S-V DIESEL FUEL
The sale of Petrolimex’s 0.001S-V diesel fuel is a pioneering step in

serving customers with high quality products that contribute to re-
ducing greenhouse gas emissions and protecting the environment.
...This is the business strategy of Petrolimex “Competition

by product quality and professional service”, in order
to well this strategy, apart from supplying high quality
products such as: Standard V , gasoline RON 95 standard
IV from the beginning of 2017, Petrolimex has invested in
building infrastructure, modern tank system, application
of management software, automation by IT such as ERP,
Egas, gasoline recovery system, petrol payment system
by ATM card…
Deputy General Director of Petrolimex,

Mr. Nguyen Quang Dung
2017
2017 IS THE THIRD YEAR Year 2017 is the third consecutive year that • It has successfully issued Decision 1.1 Total sales volume in 2017 was 12,3 m3 ton, and changes in Cambodia’s policy, the
IN THE ROLL THAT THE the Group meets and exceeds the target. No. 53/2012/QĐ-TTg: Transferring 104% of target, increasing by 7% from 2016. Group’s re-export activities faced many dif-
GROUP COMPLETE AND Growth rate of domestic supply petroleum completely from supplying petrol to
PETROLEUM In details, domestic sales volume in 2017 ficulties. Both the Group and member com-
EXCEED THE PLAN has been maintained. Together with the supplying E5 starting December 25th DIVISION was 9,7 m3 ton, 102% of target, increasing panies taking part in temporary import and
relatively satisfying achievement in business 2017; being pioneer at executing by 5% from 2016. In 2017, although there re-export made a huge effort all process like
12,3
performance, the Group also achieved other Decision No. 49/2011/QĐ-TTg: was a remarkable increase in the number of promoting marketing, being flexible in price
outstanding results: Successfully introducing Ron 95 petrol million distributors, the Group’s total domestic sales policy – customer policy in order to maintain
at 3rd and 4th levels and moving to m3,tons volume grew significantly. The majority of market share as well as focus on potential
• The Group’s shares have been selling Diesel level V since January 1st the divisions achieved growth compared to customers.
Total output sold in 2017,
officially listed on Ho Chi Minh City 2018. 2016 and met the target set by the Group.
reaching 104% of the plan,
stock exchange, in Top 50 best listed In 2017, due to global price fluctuation, un-
up 7% compared to 2016
companies in Vietnam in 2017. The • The number of petrol stations built and usual supply and demand, competition be-
Group also came first in revenue. put into operation was highest in recent tween distributors selling re-export goods
Its (market capitalization) was years.
approximately VND100 thousand
billions. The positive assessment of
stock exchange proves the sustainable
development and the transparent
management of the Group.
70 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
In 2017, the business of the PJ Tanker in • At the holding company, the operation
particular and the transportation market of Ocean vessels is well carried out, en-
in general met many difficulties due to the suring technical requirements to meet
impact of some factors: OPEC cut down the International Maritime’s standards;
output; America promoted producing petrol Regarding Van Phong 1 vessel, detailed
from slates, China intended to reduce pet- operation plans (various plans) were
rol import volume, the volume of transported constructed to timely meet the needs of
petrol reduced, the redundancy of transpor- each phase for the highest efficiency of
tation capacity; especially in ocean transpor- Van Phong 1. Work with the capital rep-
tation, the demand for big vessels reduced, resentative team to direct member com-
the price of external transportation hire re- panies to construct and execute busi-
duced, the price of fuel increased. However, ness plans with the development goals
thanks to the close management of the Cor- in mind, the next year’s results higher
Business areas: poration, the great effort of leaders and staff than the previous year’s.
in finding out solutions, the effective perfor-
• Transportation of petroleum, sea, river; • At member companies: Companies con-
mance: come up with appropriate business
• Domestic and regional bunker struct and execute business plans to
methods, take advantage the highest capac-
supply; ensure that pre-tax profit and dividends
ity of each vessel size to meet the need of
• Hire and hire crew members; may not drop below these of 2017, sat-
transporting the group’s goods and external
• Ship agency, supply and brokerage isfying the targets set at the annual gen-
ones. At the end of the financial year 2017,
seagoing vessels, towing ships; eral meeting.
its pre-tax profit was 272 billion VND.
• Renovation and renovation
• Water transport. Moving on to 2018, domestic and regional In its mid-term and long term business strat-
• Loading and unloading cargo at river transportation markets are estimated to face egies, the Corporation continues to invest,
ports and sea ports; difficulty, vessel renting price has not in- restructure its vessel fleet, improve trans-
• Manufacturing mechanical products; creased,. The Corporation continues to ac- portation capacity, strive to expand in the
cess, analyze, forecast the situation, make global market, search for foreign partners
effort to propose appropriate solutions to to better its status and image in the Ocean
the business to meet the target of 2018: PJ transportation area, under the brand name
Tanker’s consolidated profit will not be lower of Petrolimex.
than that in 2017, with the group’s set target
is VND 300billion.
1.2. PETROLIMEX TANKER PG tanker takes pride in being newly es- the ocean, rivers and coastline, the compa-
tablished from subsidiaries with long history ny intends to exploit ports for renting, pack-
CORPORATION (PGT) of establishment. Its operational scope is ing separate goods in Cua Cam Ports in Hai
distributed throughout domestic waterway Phong, with capacity of over 620,000 ton per
network and external seas, like Vipco (VIP), year, annual output at 420,000ton.
Vitaco (VTO), Petrolimex Joint Stock Tanker
(PJT),… In 2017, total transporting output of the Cor-
poration was 14,058 million m3, 5% year-on-
The Corporation owns the biggest ves- year growth and 96% of the target. In details,
sel fleet in Vietnam, especially the fleet of the transported volume of ocean vessels
14,058
long-haul vessels with total weight of over was 8,729 million m3, the output of river
million 380,000 DWT, specializing in transport- and coastline vessels was 5,329 million m3.
m3 ing petrol products from brands as Mogas, Traded output was 27.451 m3 km, seeing a
Total transport volume of the Diesel, Jet A1, Condensate, Naptha… Its 13% year-on-year growth, meeting 96% of
Corporation in 2017 vessels are all classified and certified by the target. In details, transported volume of
international registry organizations (DNV, ocean vessels was 24,347 million m3 km,
ABS, NK,…), complying with international transported volume of river and coastline
272
regulations and conventions, achieving in- vessels was 3,103 million m3 km. Total prof-
billion ternational certificates on international safe- it before tax was VND 271 billion, meeting
VND ty (DOC and SMC), international security 94% of target and 86% Y-o-Y.
PGT’s Profit before tax (ISSC). Besides transporting petroleum on
72 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
1.3. PETROLIMEX Petrolimex Transportation Services Corpora- ing a 6.2% Y-o-Y growth, costs were over 657 ration aims to meet the targets of managing increase profit for the company and increase
tion was established from transferring capital billion VND, increasing by 5.8%, profit was road transportation system to allocate trucks income for employees; conduct mass selling
TRANSPORTATION holding of the group of 6 subsidiaries: Petajico nearly VND 30.5 billion, 15.5% Y-o-Y growth, when necessary according to the certified of DO 0.001S- V at throughout the network of
SERVICES CORPORATION Hanoi, PTS Ha Tay, PTS Ha Tinh, PTS Hue, profit margin was 4.4%. The Corporation’s scheme. Accordingly, PTC will consider the petrol stations, except for those at localities
(PTC) Petajico Danang and PTS Saigon. The joint- subsidiaries were responsible for transporting divisions’ capacity of meeting the demand for of little demand for DO 0.001S- V; gradually
stock company of the group owns 620 tankers petroleum for 30 out of 43 petroleum member Business areas: transportation so as to take advantage of its replace completely DO 0.05S –II should all re-
with average capacity of 21m3 per vehicle, ac- companies. Total transport volume of 06 sub- existing vehicles. At the same time, PTC will quirements be met.
counting for 68% of total petroleum transpor- sidiaries was over 4.2 million cubic ton, 100% PTC is directly trading petroleum also modernize its truck fleets; Divisions focus
tation vehicles of the group. PTC aims to be- of target, 3.7% Y-o-Y growth; Total transport and trading petroleum business of on restructuring their truck fleets to meet the Regarding E5 RON 92-II petrol (E5 petrol),
come the leading company in petroleum road output of 06 subsidiaries was nearly 373 mil- the transport and transportation demand of the market, the State’s regulations, PTC introduces E5 petrol in the whole distri-
transportation in Vietnam, having the capacity lion cubic kilometers, 97% of target, 0.7% group of the group with the as well as to ensure its transportation capacity. bution network, ensuring that Ron 92 petrol is
and reputation to satisfy all road transportation Y-o-Y growth. structure of subsidiaries such as completely absent within the whole network
needs of Petrolimex, expanding its operation Petajico Hanoi, PTS Nghe An, In petroleum business: PTC cooperates with starting January 1st 2018, pursuant to the
to neighboring countries, trading petroleum Business results of 6 companies in 2017: Rev- PTS Hue, Petajico Da Nang and local petroleum companies to protect the current regulations. In order to maintain mar-
and being responsible for all petroleum output enue: VND 3,868 billion, growing by 18% from PTS Sai Gon. Petrolimex brand. It continues to renovate pet- ket share, business efficiency and adaptability
of the subsidiaries. 2016. Total pre-tax profit: VND 67.7 billion, rol stations according to the brand recognition to the technical and infrastructure conditions,
106% of target and increasing by 6.8% from standards of Petrolimex; It invests in techni- the plan to transfer should carefully consider:
Executing Decision No. 673/PLX-QD-HDQT 2016. cal infrastructure of petrol stations to ensure (i) selling both RON 95 and E5 petrol at each
dated November 17th 2017 of the group’s meeting of the 5S standard. PTC switches petrol station; or (ii) selling just only one kind of
Board of Management regarding business In 2018, PTC continues to introduce its strate- from selling Ron 92 to E5 and Ron 95 accord- petrol at each petrol station (either RON 95 or
targets for the 4th quarter of 2017, the Corpo- gic plans in petroleum and road transportation ing to the group’ progress; continues research E5 petrol). Continue to boost the development
ration has exceeded all targets: consolidated business. and development of petrol stations, improve of petrol stations.
revenue of the 4th quarter 2017 was VND customer service; introduce bonus policies
On transportation business: Assess truck
1,039 billion, 123% of target, the Corporation’s to encourage retailing; introduce marketing
fleets of petroleum companies to build up
consolidated pre-tax profit in the 4th quarter strategies and sales mechanism to attract cus-
general plan for the establishment of 3 limit-
2017 was estimated at VND15.3billion, com- tomers; maintain gross profit and set policies
ed companies, one service and transportation
plete. that aid the petrol business of the company;
subsidiary under the Corporation, and to allo-
develop sales of of other products (DMN, gas,
Sales from transportation of divisions by the cate small truck fleets to joint stock companies
paint, washing liquid, insurance) in order to
end of 2017 were over VND 688 billion, see- with the total of nearly 300 trucks. The Corpo-
74 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
Regarding restructuring PLC supervision on business performance,

technical infrastructure investment, mar-
• Improve quality of enterprise manage- ket expanding, product and technology
ment, allocate tasks between parent development.
company and subsidiaries, between the
Business areas: Board of Management and Board of Di- • When executing plans, ensure simplic-
rectors according to their functions and ity, cost-effectiveness, complete selling
• Grease duties, complying with the Law and the mechanism and improve business effec-
»»Petrolimex Lubricants Corporation’s Article; ensuring transpar- tiveness.
»»Marine lubricant Lubmarine ency and publicity.
»»Castrol BP Lubricants Regarding selling engine oil, asphalt,
• Asphalt • Resolve to construct plans, mechanism chemicals
»»Asphalt 6070 and agree on the number of members
of Board of Management, supervisory • Evaluate, review, construct sale poli-
»»Asphalt MC
board of the Corporation to propose to cies in 2018 by improving and renovat-
»»Asphalt emulsion
the Annual General Meeting in 2018 for ing policies of 2017 with the purpose of
»»Asphalt polymer
approval. meeting customers’ needs.
• Chemicals: more than 50 chemi-
cal solvents in the petrochemical • Continue to research, upgrade and de-
• Plan to distinguish business activities
sector, including product groups velop products of Petrolimex that are
in terms of organization and accounting
and commodities with different fuel-efficient, environment-friendly and
at the holding company to identify man-
names and uses for industries meet international standards to keep up
aging function of PLC and performance
such as footwear, rubber, paints, with the development trend of the mar-
function of parent company.
plastic, foam sponge,... ket.
• Customer Service • Constructing a system of management
»»Technical Services consisting of a consulting board, a di-
»»Test service rector and inspectors for the Petrolimex
asphalt company limited, Petrolimex
Chemicals Company Limited to improve
1.4. PETROLIMEX PLC currently is the leading enterprise in der, the First Class; in 2014, it was rewarded
the asphalt business with market share of Independence Order, the third Class.
PETROLCHEMICAL 30% (equivalent to 300,000 ton of output
CORPORATION (PLC) in 2015) and ranks second in the engine oil In 2017, competition in engine oil distribu-
business in Vietnam with market share of tion became fiercer with the entrance of
12% (equivalent to 44,4 thousand tons of two big Japanese companies, namely JX
output in 2014). The network of modern and NOEC and Idemitsu Lube,directly affecting
high-tech warehouses, reserves, factories PLC’s business performance. The asphalt
manufacturing engine oil, asphalt and chem- business also faced many difficulties due to
icals throughout the country is the compa- the delay in fund disbursal for construction
ny’s competitive advantage. PLC’s new projects, many of which were only in their
products, especially polime and emulsion, early stages. In 2017, PLC’s sales were
have been working to increase competitive VND 5,049 billion, increasing by 5% from
advantage and bring high gross profit to 2016 and meeting 87% of target. Total pre-
the asphalt business in particular and to the tax profit was VND 215 billion, equivalent to
Corporation in general. During the produc- 83.77% of 2016, meeting 71,67% of target.
tion process, all PLC’s products are carefully
In 2018, PLC has synchronously proposed
and strictly supervised, ensuring the quality
a number of measures to improve manage-
through quality control system to meet Na-
ment quality and business efficiency.
tional standard and ISO/IEC 17025:2005.
PLC’s staff is experienced, energetic and
technology-oriented.
PLC has been awarded with many precious

recognitions by the Party, the State, the
Government and authorities. In 2007, PLC
was awarded the Labor Hero of the Renova-
tion era; in 2009, it was awarded Labor Or-
76 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
attract new ones, analyze and spot new Workforce strategy:

markets. It also maintains development of
multi-sectors orientation, with Gas trading Human resource is considered to be an in-
being the major one, to facilitate its strong tangible source which plays a vital part in
development in the future. the success and development of enterpris-
Activity Network: es. Therefore, the Corporation’s human re-
Consider restructuring the Corporation to source management focuses on:
• Hanoi Gas Company Limited improve the capability of utilizing resourc-
• Hanoi LPG factory es and stocks... in accordance with market • Promoting young workforce by recruit-
• Hai Phong Gas Company Limited strategies. ing and training programmes infused
• Hai Phong LPG Factory with motivation, experience skills from
• Da Nang Gas Company Limited Distribution strategy: senior staff.
• Danang LPG factory
Since the Corporation’s business is mainly • Providing regular training to upgrade the
• Sai Gon Gas Company Limited
aimed at commerce, the Corporation con- skills and qualifications of staff, technical
• Sai Gon LPG Factory
tinues to complete and develop various dis- and managerial officials.
• Can Tho Gas Company Limited
tribution channels in major markets as well
• Can Tho LPG factory • Gradually improving management
as in those in local markets. The Corpora-
• Bac Ninh Gas Branch structure, salary and bonus policies to
tion sees Gas as a special product of which
• Phu Tho Gas Branch encourage productivity and to facilitate
safety needs to be ensured when operating,
transporting and consuming. Therefore, staff to self-affirm.
apart from selling activities, technical and
• Providing favorable conditions so that all
after-sales service are also attached to the
employees are able to own shares of the
group’s business to affirm that Gas Petroli-
group, promoting loyalty.
mex is a reliable choice for customers.
Price strategy:
In recent years, there has been an increas-

ingly fierce competition in the gas market
1.5 PETROLIMEX GAS Petrolimex Gas Corporation, preceded by Corporation output for civil use, commerce
in Vietnam, including price competition.
the Petrolimex Gas Joint Stock Company, and industry uses still maintains the growth
CORPORATION JSC. is one of the companies partly owned and rate of 8 – 10% each year. The Corporation’s
However, with its price strategy, PGC al-
ways sets a reasonable price based on its
(PGC) managed by the Vietnam National Petro- distribution network is allocated throughout
financial ability so that it can cooperate with
leum Group. After nearly 20 years of estab- 63 provinces of Vietnam and expanding.
other big Gas brands to stabilize the market
lishment, PGC has a wide range of operation
to harmonize the benefits of consumers and
network and serves many areas like indus- In 2017, the Corporation invested heavily
distributors.
try, agriculture, commerce and consumption. in brand establishment and development.
It is said to be one of the most prestigious It also focused on structuring the network,
brands in Vietnam market in terms of selling proposing programs to cooperate with mem-
gas (LPG). At present, PGC owns a system ber petroleum companies of the Vietnam
of modern equipment and infrastructure. Its National Petroleum Group, which gained re-
Business areas: network of ports and reserves with total ca- markable results. Total output was 148,639
pacity of 4,000 MT is located in strategic in- ton, meeting 98% of target and achieving
• Liquefied gas dustrial zones of the country. Its preservation 103% Y-o-Y growth. Pre-tax profit was
• Painting and testing gas tanks and packing technology matches that of re- VND190,706 million, exceeding target by
• Domestic and commercial gas cyl- gional countries. Its products are completely 27% and achieving 136% Y-o-Y growth.
inders safe, of high quality, of which listed weight is
• Installing, operating tanks, LPG In our country’s current economic condition,
true to actual weight. In industrial field, PGC
technology global economic integration is becoming
is also one of the leading units in setting up
• Gas stove and gas stove acces- vital. Therefore, market share expansion
gas reserves as well as in supplying gas for
sories is considered an important requirement for
companies. It is trusted by domestic enter-
• Install industrial gas stamping the Corporation to develop. In the coming
prises and FDI ones from Japan, Korea,
years, it will continue to improve production
Hong Kong…
efficiency, invest in building tanks in ports
In today’s fierce competition, with over 70 and clue stocks, improve gas management
gas brands in the market, Petrolimex Gas competence, retain existing customers and
78 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
1.7. PETROLIMEX Petrolimex Aviation Fuel JSC (PA) was es- ing sharply. Its pre-tax profit grew by 5,4%
tablished in 2008, supplying fuel for domes- to VND386 billion, fulfilling 133% of the set
AVIATION FUEL JSC (PA) tic and foreign airlines. After many challeng- target. output in 2017 was 795,000 m3, 24%
es in the initial phase of establishment, PA higher than planned, equivalent to 123% of
has made great effort to become a major 2016; rate between pre-tax profit and share-
one among Vietnam National Petroleum owners capital was 128.5%. Since 2016, PA
Corporation’s subsidiaries. PA’s success ranked the 4th in terms of sold output and
has disrupted the monopoly in aviation had the highest profit among member com-
fuel market, governed by Vietnam Air Pet- panies of the Group.
rol Company – a member of Vietnam Air-
lines. Currently, PA supplies all fuel and fuel In Year 2018 and the coming years, PA con-
charging services for Vietjet Airline’s planes tinues to upgrade its structure, expand its
at airports like Noi Bai, Tan Son Nhat, Cat Bi, distribution network, improve its competitive-
Da Nang and Cam Ranh. Moreover, PA is ness, reduce costs to ensure its sustainable
Business products: also a prestigious supplier for such interna- development target. Besides, PA always
tional airlines as Emirates Airline, Singapore follows and sticks to the changes in domes-
• Aviation fuel Airlines, Etihad Airways, Air France... tic and foreign petroleum markets so that it
• Other petrol could keep reserved gas reasonably. Being
In 2017, there was a fierce competition be- a member of Petrolimex is PA’s advantage.
Business networks: tween suppliers in the Aviation market of Thanks to this, PA continues to maintain and
Vietnam. Besides, due to the unforeseen boost its international partnership through
• Tan Son Nhat International Airport
price of aviation fuel and the reduction in commerce promotion activities to raise
(SGN / VVTS)
supply, PA faced many challenges. Thanks Petrolimex’s brand and to create competitive
• Cam Ranh International Airport
to PA’s great effort and support from the advantage, develop market
(CXR / VVCR)
group and other companies in the field, PA
• Da Nang International Airport
managed to achieve high growth rate in
(DAD / VVDN)
2017, with sales and pre-tax profit increas-
• Noi Bai International Airport (HAN
/ VVNB)
• Cat Bi International Airport (HPH
1.6. PETROLIMEX Petrolimex Insurance Corporation (PJICO) meeting 100% of target and achieving a / VVCI)
is the foremost insurer in Vietnam which 6.2% Y-o-Y growth. The pre-tax profit grew
INSURANCE operates under the joint stock ownership by 25% to VND156 billion, meeting 112%
CORPORATION (PGI) structure. Since establishment, PJICO has of the set target.
I suppose, in front of Petrolimex Aviation
been making great effort to become one is the sky widely open to taking off
of the four leading enterprises in Vietnam Orientation and plan for 2018: according
to the Corporation’s five-year target and
Petrolimex Vietnam
market in terms of non-life insurance.
orientation (2014 - 2019), which was ap- Petroleum Corporation Chairman - Mr. Bui Ngoc Bao
Having an business model encouraged by proved on the annual general meeting on
the State and a policy on insurance price, April 23rd 2014; comprehensive renova-
especially the energetic and effective ser- tion focusing on innovating, developing
vice, PJICO has created a reliable and business towards effective, quality and
prestigious image in customers’ minds. stable orientation, in documentary No.
1.8. DIVISION OF BUILDING, 1.9. OTHER JOINT
Business areas: 65/2017/CV-HĐQT dated October 18th MECHANICS, PETROLEUM VENTURE COMPANIES
In 2017, PJICO successfully issued sep- 2017, the Board of Management approved EQUIPMENT, EXPORT-IM-
• Motor vehicle insurance arate shares, increased authorized cap- the business plan for 2018. Details are as
• Health insurance ital for foreign strategic shareholders;
PORT AND INFORMATION
follows:
• Cargo insurance continued innovating business activities, TECHNOLOGY
• Technical Asset Insurance improving management in order for bet- Revenue from original insurance: VND
• ship insurance ter efficiency; PJICO brand was affirmed; 2,625 billion (excluding revenue from fish- In general, this division failed to meet its Although Castrol – BP Petco failed to meet
• Mixed insurance the cooperation with other companies ing ship insurance), increasing 5% from target, in which Pitco admitted to make a its target, estimated dividend paid for the
in the field gained good results; PJICO’s 2017; Commission from re-insurance was loss, Building III only met 4% of the pre-tax group still passed VND400 billion.
business results in 2017 were positive. In VND143 billion; sales from re-insurance profit target; Piacom completed 106% of the
2017, PGI’s gross revenue was VND 3,171 fee was VND190 billion. plan, Building I completed 110%, and PEC
billion (including sales from original insur- completed 111% of the plan. PECO and
ance, re-insurance, commission, normal PMS exceeded the target by 47% and 30%
insurance, investment and other income), respectively. Total revenue of the division
of which sales from original insurance was VND4,923 billion, equivalent to 95.8%
were VND 2,611.6 billion, sales from origi- of 2016 revenue, pre-tax profit was VND70.1
nal insurance excluding sales from fishing billion, meeting 58.1% of the target and
ship insurance, according to Decree 67 of seeing a 48.9% Y-o-Y loss.
the government, were VND2,496 billion,
80 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
2. FINANCIAL SITUATION
Unit:
TOTAL CONSOLIDATED ASSET PERIOD 2015 - 2017
VND billion
2.1
70.000
ASSETS
60.000
Total consolidated assets of the group as of

December 31st, 2017 were VND61,769 bil- 50.000
TOTAL CONSOLIDATED ASSET ON PARENT COMPANY’S DEBT
DECEMBER 31ST, 2017 lion, seeing a 13.87% Y-o-Y growth equiva-
lent to VND 7.525 billion. In which: 40.000
• Long term assets increased by VND374

billion, mainly long-term incomplete as- 30.000
sets and long-term financial investment.
20.000
• Short-term assets increased by
VND7,150 billion or 21.4% compared to
the beginning of the year figure, mainly 10.000
cash and inventory.
0
Owners’ equity as of December 31st 2017
was VND20,519 billion (excluding benefits 2013 2014 2015 2016 2017
of non-managing shareowners), increasing
by VND542 billion compared to the begin- Cash and cash equivalents Fixed assets Other asets
ning of the year, mainly from increasing oth-
Inventories Long-term financial investments
Long term assets 34% Payables 49% er funds of owners’ equity.
Short-term assets 66% Short-term debts 36% Debts owed to parent company
Gasoline price stabilization fund 13% • Payables: VND11,507 billion, in which:

VND3,793 billion to MTV Binh Son lim-
Other 2% ited company, VND 1,889 billion to MTV ASSET STRUCTURE 2015 ASSET STRUCTURE 2016 ASSET STRUCTURE 2017
Petrolimex Singapore limited company,
VND2,068 billion to Vitol Asia.
PERCENTAGE
2017 2016
ORDER
DIFFERENCE
CRITERION • Short-term debts of VND8,510 billion;
VALUE PER- VALUE PER- % VND3,040 billion of which was assigned
CENTAGE CENTAGE
to as the petrol stabilization fund and
1 Short term asset 40,526 65,61% 33,376 61,53% 21,42% was used according to the Joint Circular
2 Long term asset 21,243 34,39% 20,868 38,47% 1,80%

No. 39/2014/TTLT-BCT-BTC dated Oc-
tober 29th 2014 issued by ministries of 2015 2016 2017
Commerce and Finance.
A Total asset 61,769 100% 54,244 100%
• Other payables include tax and oth-
1 Payable Debt 38,385 62,14% 31,044 57,23% 23,65% er undue payments, salary,…: total
VND233 billion.
Short term Debt 35,758 57,89% 27,942 51,51% 27,97%
• The receivables and payables to parent
Long term Debt 2,627 4,25% 3,102 5,76% -15,30%
company are payments within deadline;
long-term loans with no specific due. Cash and cash equivalents 22,20% Cash and cash equivalents 20,93% Cash and cash equivalents 23,03%
2 Owner’s equity 23,384 37,86% 23,201 42,77% 0,79%
Inventories 14,98% Inventories 15,90% Inventories 20,83%
B Total Captial 61,769 100% 54,244 100%
Fixed assets 29,95% Fixed assets 28,84% Fixed assets 24,72%
Long-term financial investments 5,82% Long-term financial investments 4,39% Long-term financial investments 4,67%
Other asets 27,05% Other asets 30,0% Other asets 27,0%

82 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
Unit:
3. IMPROVEMENTS IN STRUCTURE,
POLICY AND MANAGEMENT
TOTAL CONSOLIDATED RESOURCE PERIOD 2013 - 2017
VND billion
70.000
60.000
50.000
40.000
30.000
20.000
10.000
0
2013 2014 2015 2016 2017
Owner's equity Short term debt Long term Debt
STRUCTURE OF CAPITAL 2015 STRUCTURE OF CAPITAL 2016 STRUCTURE OF CAPITAL 2017
2015 2016 2017 3.1. 3.2.

REGARDING STRUCTURE, POLICY AND RISK MANAGEMENT MEASURES TO
MANAGEMENT IMPROVE OPERATIONAL EFFICIENCY
• Continue the integration process with Egas, the system of au- • Occasionally set up supervisory delegation in member com-
tomatic dispense of goods at warehouses to resolve any issues panies to increase supervision from planning to implementing.
emerging during the operation of the system. Carry out methods of cost cutting from importing, to reserving,
Owner's equity 32,31% Owner's equity 42,77% Owner's equity 37,86% circulating and selling.
• Execute integration and optimization of data system to get best
Short term Debt 61,11% Short term Debt 51,51% Short term Debt 57,89% results in administration and management and minimize opera- • Prioritize investing on specialized business and supporting ser-
tion costs, handle and resolve incidents of key systems utilized vice of petroleum trading, avoid investing in non-major areas of
Long term Debt 6,57% Long term Debt 5,72% Long term Debt 4,25%
by the group; the group
• Identify areas that need professional process renewal, reports

should have drill down status, safekeep reports to re-use…
84 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
4. PROPOSED PLAN FOR 2018

Domestic economy is forecast to be stable, – 29 suppliers; and over 155 distributors,...); 4.1.
with the target to stabilize macro-economy, Competition in price between suppliers and In 2018, the board of management pledges to continue focusing on retailing, the largest
control inflation. Proposed socio-economic distributors is becoming more intense. If this
PLAN TO INVEST
source of income to the company, taking leverage from brand advantage and a nationwide
development plan for 2018: GDP is estimat- occurs to retailing, the output growth and IN TECHNICAL network. Therefore, the domestic petroleum business will focus on repairing and developing
ed to grow by 6,7%; Total capital for social gross profit will be directly affected. Copy- INFRASTRUCTURE IN new gas stations. The group plans to build 70 new gas stations, upgrade 217 existing ones
development is estimated at 33% - 34% of right violation and commercial cheating are
GDP. getting more complicated and sophisticated,
2018, PETROLEUM AREA with total capital of VND1,000 billion.
difficult to control and have yet to be solved
1,590 VND
Growth of petroleum demand in 2018 is Order Project Number Worth
forecast to be equivalent to GDP growth – at The network of gas stations expands rapidly billion (petrol stations) (billion VND)
6.5%. nationwide (there are about 15,500 gas sta-
Value of investment 1 Build new petrol station 70 755
tions nationwide). The gas stations are more
158,000 VND
The decisive command of the Government and more professional. Those with 100% 2 Upgrade existing petrol stations 217 257
70
billion and Ministry of Industry and Trade to car- capital from overseas are even much better.
ry out Decision No. 49/2011/QĐ-TTg dat-
The Consolidate revenue 3 Expand and upgrade stock, reserve and wharf 111
ed September 1st 2011 and Decision No. The Nghi Son Oil Refinery will begin oper-
53/2012/QĐ-TTg dated August 31 2016 ation by the end of the second quarter in Build new
4 Gasoline dispenser, IT and automation. EGAS 187
approved by the Prime Minister is an oppor- 2018. This will affect PLS’s performance as petrol station
tunity for the group to increase productivity well as the plan to pay State budget of the 5 Buy and maintain equipment 119
12,536,800 m3,
tons
and promote its image.
Foreign currency supply in 2018 is estimat-

group.
With the above situation and the favorable

217 6 Others 161
Sold Volume of Petrol and Oil

ed to be stable. The exchange rate fluctua- conditions of 2017’s ceasing to exist, the Upgrade existing Total 1,590
tion is forecast to increase by 3% in 2018. managing board has set some targets for petrol stations
2018
Besides the above advantages, the group’s
business is forecast to be affected by some
factors:
SPECIFIC TASKS OF 2018
Competition in the market keeps increasing
(the number of suppliers remains the same
1. Effective production and sales development on the basis of deepening
the pioneer and identity of Petrolimex to meet the targets set in each field;
2. Continue to restructure under Decision 828 of the Prime Minister, includ-
Order Criterion 2018 plan Compared to 2017 (%)
ing reduction of state capital to 51% under Decision No. 123.
1 Sale volume of petroleum products (m , ton) (*)
3
12,536,800 102%
2 Consolidated revenue (VND billion) 158,000 103%
3 Consolidated before -tax profit (VND billion) 5,000 104%

4.2. Ensuring priority in business safety the QĐ-TTg dated August 17th 2017, from the
supervision of fire protection. It is also Prime Minister and approved by the Minis-
4 Dividend rate (%) Min12%
OTHER MAJOR essential to protect the environment, en- try of Industry and Commerce. Completing
5 Total investment value (VND billion) 1,590 107% ACTIVITIES IN 2018 sure security and safety at the group’s gas restructuring order according to Decision
stations; establish prospects of implemen- No. 828/2011/QĐ-TTg dated May 31st 2011
tation of information technology and auto- from the Prime Minister regarding the ap-
(*) Including domestic, re-export, external sales, mation in production to encourage safety proval of equitization and restructuring the
output of Aviation Fuel Joint Venture Company, and productivity. Vietnam Petroleum Company; establishing
Laos Petrolimex and output excluding crude oil of Construction Company; restructuring PG-
Constructing plan to reduce State’s hold- bank, Pland.
Petrolimex Singapore.
ing to 51% according to Decision No. 1232/
04. EVALUATION OF THE
BOARD OF DIRECTORS
ON THE PERFORMANCE
OF THE GROUP
1. Evaluation on the performance of

Petrolimex
2. Evaluation on the performance of the
Board of Directors
3. The Board of Directors activities in 2017
4. Orientation plans of the
Board of Directors
PETROLIMEX
AVIATION FUEL
88 PETROLIMEX
ANNUAL REPORT 2017
04. EVALUATION OF THE BOARD OF DIRECTORS
ON THE PERFORMANCE OF THE GROUP
PETROLIMEX
1. EVALUATION ON THE
PERFORMANCE OF PETROLIMEX
In 2017, the national economy gradually improved, GDP in each quarter was higher than the
previous one, GDP growth by year reached 6.81%, by passed the planned target of 6.7%. The
Inter-Ministry continues to carry out Decree No. 83/2014 / ND-CP and strictly follows the global
petrol prices to regulate the domestic petrol market. The supply of foreign currency was abundant
and relatively stable with exchange rate fluctuations were lower than forecast.
The Group has synchronously and resolutely executed the proposed solutions, closely followed
market developments and macro policies of the State, timely adopted appropriate and effective
solutions for each market segment, each division and time period; with the efforts of the Group
and its subsidiaries, the results of the Group in 2017 were quite comprehensive, meeting or ex-
12,286
ceeding the targets set at the 2017 Annual General Meeting. Some major figures:
million
m3, tons
Total output of petroleum
sold was 104% of the plan
The Group was officially listed (PLX code) Continue implementing the Corporation Re-
on the Ho Chi Minh City Stock Exchange, structuring Proposal approved by the Prime
listed in the Top 50 best public companies in Minister and Minister of Industry and Trade;
Vietnam in 2017, unmatched in terms of rev- Vietnam National Petroleum Group estab-
enue. The Group’s authorized capital has so lishes Petrolimex Petroleum Service Corpo-
far reached approximately VND100 trillion. ration on 01/10/2017.
153,697 VND
billion
A positive feedback from the stock market
demonstrates the sustainable development
and transparency of the Group’s administra-
The Group fully and timely abide by the
resolutions of the Annual Annual General
2. EVALUATION ON THE PERFORMANCE

Total consolidated revenue
tion. Meeting, the Board of Management and the
reached 107% of the plan
regulations of the State.
On the supervision of the General Director and the Manager:

OF THE BOARD OF DIRECTORS
• The Board of Directors always closely monitors the operation of the General Director,
4,785
The Board of Directors has successfully fulfilled its responsibility of co- • Establishment and consolidation of the sustainable development
tỷ promptly addresses issues arising under the jurisdiction of the Board of Directors to facil-
ordinating the Group’s business activities in accordance with the orien- foundation in the direction of the development strategy for 2016-
đồng itate the operation of the General Director.
tation and direction from the Board of Management. 2020.
Total consolidated tax profit • Require the General Director to strengthen the direction of the implementation and regu-
The General Director and managers of the Vietnam National Petroleum In the business management process, the Board of Directors has
reached 102% of the plan larly report to the Board about the Group’s activities to improve the efficiency of business
Group have successfully fulfilled its responsibility of business manage- complied with the management decree in the Charter, the internal
operations;
ment of the Group, namely: management policies of the Group as well as the resolutions and
• Directing drastically in investment, reducing costs, organizing the market well, revising directions of the Board of Management.
• M
eeting of business targets in 2017 approved at the Annual Gen-
the business mechanism to closely follow the demand of each market area, especially
eral Meeting and by the Board of Management. The Board of Directors has focused on leading and directing the
organization evaluation of the warehouse system. to increase the supervision, manage-
30
execution of business solutions in a spirit of creativity, overcoming
% ment and promulgation of techno-economic norms: wastage norms, warehousing and • Implementation of the Group Restructuring Plan approved by the difficulties and determined to fulfill the objectives and business plan. .
transport charges, organizing the reception and exploitation of foreign stores Van Phong Prime Minister and Minister of Industry and Trade;
to increase business performance. In overall evaluation in 2017, the Board of Directors and the man-
Tỷ lệ chia cổ tức năm 2017 dự kiến
• Direction on implementation of resolutions and decisions of the agers of the business have fulfilled the tasks well, responsibly and
• Directing and assigning the Group to the capital of the Group in the corporations / joint Board of Management. effectively directed the company following the direction and decisions
stock companies, multi-member limited liability companies to formulate solutions to en-
of the Board of Management.
hance the management and raise the efficiency of the use of capital. • Implementation of the key solutions approved by the Board of
Management.
Generally, in 2017, the Board of Directors and the managers of the Company have been
responsible and effective in the direction and decisions of the Board.
90 PETROLIMEX
ANNUAL REPORT 2017
PETROLIMEX
3. THE BOARD OF DIRECTORS 4. ORIENTATION PLANS OF THE

ACTIVITIES IN 2017 BOARD OF DIRECTORS
The Board of Directors operates in accor- • All decision making issues of The Board • The Board of Directors has directed the In 2018, The Board of Directors has contin- 828/2011 / QD-TTg dated May 31, 2011 • Developing a plan for divesting capital; Iden-
dance with the provisions of the Charter and of Directors are discussed in details and management of short-term and long- ued to implement solutions to improve the by the Prime Minister approving the eq- tify the best methods of divesting the capital
the Law on Enterprises. Board meetings are timely announced in accordance with term debts of the parent company - quality of corporate governance. Based on uitization and restructuring of Vietnam on the basis of legal factors, favorable mac-
conducted regularly, in accordance with the regulations with the Supervisory Board Petrolimex. the actual situation of the Group, The Board National Petroleum Group: Establishing ro to act in accordance with the regulations.
regulations. The Board of Directors has fol- and the Board of Management. of Directors will issue a Resolution approv- the Construction Corporation; Restruc-
lowed closely the orientation agreed at the • T
he Board of Directors has directed ing the objective of maintaining the stabili- turing PGBank, Pland. • Urging the relevant ministries and
Annual Annual General Meeting and the ac- • Proposals of The Board of Directors are drastically in investing, cost cutting, ty and sustainable development, improving branches to consider the amendment
tual situation of the Group to propose and analyzed, discussed and given feedback structuring the market well, revising the business efficiency and intended dividends • Finalize Planning the system of techni- of regulations on investment activities
implement resolutions. In addition to regular in a timely manner business mechanism to closely follow in 2018 of minimum 12%; These proposals cal facilities and infrastructures for the in the fields of petrol production, trading
meetings, The Board of Directors requested the demand of each market area, es- are coupled with measures to perform the petroleum trading in the 2017-2021 peri- and distribution in Vietnam.
• The Board of Directors has directed the pecially conducting organization evalu- od, toward 2030.
90 times for comments statement from the task well, focusing on the following major
construction of a business plan and oth- ation to establish investment strategies, • Strengthening international integration;
BOD members to make clear of the primary issues:
er plans to submit to the Annual General enhance the supervision, management • Improve the efficiency of capital spend- investing, trading outside the territory of
responsibilities of the Board and its tasks to
Meeting for approval; and promulgation of techno-econom- • Directing the successful implementation ing, through such measures as: Vietnam.
direct, manage and regulate activities of the
Group. Some main tasks: ic norms: wastage norms, charges for of the Resolution targets of the Annual
• Approval of financial reports on auditing • Reviewing investment projects in order to
warehousing, freight, intake and oper- Annual General Meeting in 2018;
and evaluation of the results of business correctly prioritize, avoiding widespread in-
• T
he Board of Directors has led the ation of Van Phong warehouse to in-
activities of companies quarterly and in • Continuing to restructure under the vestment;
Group effectively, preserving and raising crease business efficiency.
2017; restructuring proposal of the Group,
capital,adding value to shareholders. • The Group continues to maintain centralized
• The Board of Directors has directed and revising the organizational structure,
• The Board of Directors has instructed capital management contracts with large
• The Board of Directors has directed the assigned capital representative teams especially of companies with many
the organization of cadres under the au- banks to increase capital turnover; Imposing
amendment and promulgation of the in- at Corporations / Joint Stock Company, subsidiaries and branches to have a
thority of The Board of Directors; a good interest rate against the capital mar-
ternal management regulation system in Limited liability companies to propose proposed progress of restructuring,
ket; Flexible use of financial instruments;
line with the new structure of the listed • The Board of Directors has instructed to measures to enhance management, im- aiming for simplicity, efficiency, and
company. continue implementing the restructuring prove the efficiency of capital spending. a cost-effective model in line with the
of Vietnam National Petroleum Group in government’s restructuring orienta-
• The Board of Directors has closely coor- • The Board of Directors has instructed to tion. Developing a plan to reduce the
accordance with the regulations of the
dinated with the Board of General Direc- prepare the contents and organization proportion of state holding to 51% ac-
Government and the Ministry of Industry
tors and the Supervisory Board in direct- of the Annual Annual General Meeting cording to Decision No. 1232 / QĐ-TTg
and Trade
ing the implementation of the resolutions in 2017 dated 17/8/2017 by the Prime Minister
of the Annual General Meeting and The • The Board of Directors has supervised to submit to the Ministry of Industry and
Board of Directors for the Group; the investment activities under the au- Trade for approval. Completing the re-
thority of The Board of Directors; structuring plan under the Decision No.
05. GROUP
ADMINISTRATION
1. Board of Directors
2. Board of Supervisory
3. Departments under Board of Directors
4. Transactions, remuneration and benefit
packages of the BoDs, BoM and the
Supervisory Board
PETROLIMEX
PETROCHEMICAL
94 PETROLIMEX
ANNUAL REPORT 2017 05. GROUP ADMINISTRATION 05. GROUP ADMINISTRATION
PETROLIMEX
Mr. TRAN NGOC NAM Mr. NGUYEN THANH SON Mr. BUI NGOC BAO Mr. PHAM DUC THANG Mr. LE VAN HUONG Mr. PHAM VAN THANH Mr. NGUYEN ANH DUNG
96 PETROLIMEX
PETROLIMEX
1. BOARD OF DIRECTORS
MR. BUI NGOC BAO Mr. HITOSHI KATO Mr. LE VAN HUONG Mr. TRAN NGOC NAM
BOARD CHAIRMAN BOARD MEMBER BOARD MEMBER BOARD MEMBER
Year of birth 1958 | Hometown Thai Binh Year of birth 1957 Nationality Japanese Year of birth 1963 | Hometown Thanh Hoa Year of birth 1965 | Hometown Nam Dinh
Qualifications PhD in Economics Language English Qualification Chemical Engineer, Bachelor degree in Economics Qualification Bachelor Degree in Accounting
Politic qualification Advanced Current position Vice - Chairman of JX Nippon Oil & Energy Corp Politic qualification Advanced Politic qualification Advanced
Language English, Russian Language English, Czechoslovakian Language English
Current position Board chairman Current position PLX Head of Human Resources - Wage - Bonus Current position PLX Deputy General Director
Department
MR. PHAM DUC THANG MR. NGUYEN THANH SON Mr. NGUYEN ANH DUNG Mr. PHAM VAN THANH
BOARD MEMBER BOARD MEMBER BOARD MEMBER BOARD MEMBER
Year of birth 1961 | Hometown Thai Binh Year of birth 1962 | Hometown Ha Noi Year of birth 1971 | Hometown Phu Tho Year of birth 1972 | Hometown Hung Yen
Qualification Master degree in Economics Qualification Master degree in Economics Qualification PhD in Economics Qualification Master degree in Business Administration, Bachelor
Politic qualification Advanced Politic qualification Advanced Politic qualification Advanced degree in Accounting
Language English, Russian Language English Language English, Russian Politic qualification Advanced
Current position PLX General Director Current position PLX Specialized Board member Current position Chairman of Board Commissioner - Petrolimex Language English
Joint Stock tanker Company Current position Petrolimex Aviation General Director
98 PETROLIMEX
PETROLIMEX
2. BOARD OF SUPERVISORY
Board of Supervisory includes: Order Full Name Job title Year of birth Qualification
1 Dinh Viet Tien Chairman 1960 Bachelor Degree in Economics
2 Nguyen Thu Ha (*) Member 1962 Bachelor Degree in Economics
3 Dang Thi Hong Ha Member 1963 Bachelor Degree in Economics
4 Nguyen Vinh Thanh Member 1963 Master Degree in Economics
5 Tong Van Hai Member 1980 Master Degree in Economics
(*) Ms. Nguyen Thu Ha retired from October, 1st, 2017
In 2017, the Board of Supervisory has ful- porations and Companies (Petrolimex
filled its responsibilities as below: PetroChemical Corporation, Petro-
limex Nghe Tinh transportation and
• Establishing and issuing the 2017 su- service joint stock company, Petroli-
pervisory plans through document No mex Singaporean one member limited
0221/PLX - BKS on March 7th, 2017 liability joint stock company, Petroleum
Bac Thai Company, Petrolimex Cao
204
• Beside unofficial discussions, 4 meet-
Bang Compnay, Petrolimex Thai Binh
ings with full attendance of Members
Company), reexamining the results at
were democratically and lawfully held
Petrolimex Joint Stock tanker compa-
ny, Petrolimex Insurance Corporation
RESOLUTIONS OF THE
In 2017, The Board of Directors conducted
11 meetings, issued 204 Decree and 11
• Approving the 2017 total short - term
credit limit of the parent company - Viet
0221/PLX-BKS • Supervising in promulgating the reso-
lutions of the Annual General Meeting and other Group’s supervisions
and the Group’s Board of Directors. All
BOARD OF DIRECTORS Decisions related to specified jurisdiction. Nam National Petroleum Group Petroli- dated March 7, 2017 is a
• Assessing, amending, supplement-
resolutions complied to the Group’s
LAUNCHED IN 2017 Monthly meetings were held regularly to mex document to develop and
ing, completing the regulations, rules,
regulations, resolution of Annual Gen-
discuss main problems related to Board’s management process, economic -
promulgate the Monitoring eral Meetings and the Group’s regula-
responsibilities for commanding, managing • Approving policies of purchasing, sell- technical norms, etc related to Group’s
Plan 2017 tions regarding internal management
and supervising the Group’s activities as ing, liquidating, investing..... fixed assets internal management
below: at the Group’s units in hierarchy.
• Appraising, analyzing and evaluating
• Attending meetings and proposing
b. Company Development the business results and business
a. Company Administration: ideas to the Group’s Board of Directors
management, shortening the report
• Assigning the 2017 target to: The parent • The Board of Directors has the jurisdic- preparation time to propose the re- • Appraising periodic and yearly Finan-
company - Group, Corporations/ Sin- tion in approval and supervision of in- quests to Group’s leaders in a timely cial Statements of the Group
gle member Limited Liability Company; vestment projects manner.
11 resolu-
04
• Proposing ideas in constructing and
Representatives who administer the
• Continuing implementing the Group re-
official • Supervising the implementation of the
tions implementing Group’s Production -
Group’s fund at Joint Stock Companies
structuring project in accordance with meetings Group’s main tasks, 2017 Manufac- Business Plan and other related du-
and Joint Venture Companies
on issues under the the guidelines, requirements of Govern- with the full participation turing - Business Planning, Group’s ties.
authority issued by the • Board of Directors has the jurisdiction in ment and Ministry of Industry and Trade of Board of Supervisory restructuring; reviewing, evaluating
Board through 11 monthly appointing staff the Group’s facilities and finishing the
maintenance meetings • Exercising the process of moving and Technical facilities schedule for Petro-
• Board of Directors has the jurisdiction in appointing employees who will hierar- leum Business in the period of 2016
supervising investment chically work in Group’s companies and - 2021 towards 2030, commanding
departments the execution of policies for labors,
• Implementing, constructing and issuing improving the effectiveness of capital
new Economic - Technical norms, reg- • Reviewing, amending and approving
spending.
ulations of hierarchically internal man- the list of planning personnel under the
agement Group’s control in the period of 2017 - • Directly supervising, assessing Cor-
2021 and the vision of 2020.
100 PETROLIMEX
PETROLIMEX
3. DEPARTMENTS UNDER
BOARD OF DIRECTORS
MAIN FUNCTIONS OF
GENERAL ADMINISTRATION DEPARTMENT
To consult and assist the Board Coordinate work between the Being the Group’s secretary,
of Directors its leadership func- Board of Directors and share- Chair- man’s secretary as well
tions in order to manage all of holders, between Board of as Board members’ secretary in
the Group’s activities. Management and internal as the Group’s management.
well as external organizations.
49 REGULATIONS
ON INTERNAL MANAGEMENT business fields of Subsidiaries, whose 3.1.2. Department’s performance in 2017 Boards in constructing the protocol for
COMPATIBLE WITH THE NEW authorized capital is completely owned appraisal, submitting to the Board of
by the Group, assigning tasks to repre- In 2017, the General Department has ful- Management for approval the docu-
ORGANIZATIONAL STRUC-
3.1. sentatives groups which administer the filled its specialized duties as below: ments of Annual General Meetings at
TURE AND LEGAL PROVISIONS
PROMULGATED, AMENDED GENERAL ADMINISTRATION DEPARTMENT Group’s fund at Joint stock companies
• E
ffectively consulting in the Group’s
19 Petrolimex Corporations, Petrolimex
AND SUPPLEMENTED IN THE Joint Stock Companies in a timely man-
• Following the manufacturing and busi- management; co-operating with other
2015-2017 PERIOD ner, without compromising quality
ness situations of Group as well as these Group’s departments to research, draft
3.1.1. Function and mission bers’ secretary in the Group’s manage-
of Single member Limited Liability Joint and amend 49 regulations of internal • Chairing the co-operation with other
ment.
The General department is one part of ad- Stock Companies to report to the Board management suitable to the new orga- related departments in consulting the
ministrative organization of the VietNam Na- The main duties of General Administration of Directors based on Group’s reporting nizational structure and regulations in Board of Directors in order to assign
tional Petroleum Group. Its main functions Board are as below: regime ; co-ordinating in preparing and order to manage, supervise and conduct manufacturing - business plan in the
are: drafting related documents so that the the Group’s activities period of 2015 - 2017 to : the Group,
• G
athering information, preparing peri- Board of Directors could consider and 46 Corporations/ Single member limit-
• C
onsulting and assisting the Board of odic and unusual meeting agenda for • Chairing the co-operation with other de-
make decisions in their specific jurisdic- ed liability Companies, representatives
Directors in its leadership functions in the Board of Directors, monitoring the partments in consulting, proposing ideas
tion administering funds of 22 Corporations/
order to manage all of the Group’s activ- implementation process as well as the for the Board of Directors. As a result,
Joint stock companies, Limited Liabili-
ities results of executing the Group’s resolu- • Gathering and following the perfor- the Group’s policies were issued and
ties Companies
tions mance of Joint Stock companies, Lim- amended 4 times; 46 Corporations and
• Coordinate work between the Board of ited Liabilities Companies and Joint Single member Limited Liability Compa- • Chairing the co-operation with other
Directors and shareholders, between • Drafting report documents containing Venture Companies partly owned by the nies owned by the Group complying with related departments in consulting the
Board of Management and internal as the Group’s long term and yearly plans Group. the new organizational structure and Board of Directors in assessing the op-
well as external organizations as proposed by the Board of Directors lawful regulations erational efficiency as well as ranking
to be approved at the Annual General the Group and 67 Group’s divisions in
• Being the Group’s secretary, Chair- Meeting; co-ordinating with other de- • Chairing the co-operation with other
the period of 2014 - 2016
man’s secretary as well as Board mem- partments to report the yearly targets in
102 PETROLIMEX
PETROLIMEX
MAIN FUNCTIONS OF
STRATEGY AND INVESTMENT DEPARTMENT
Proposing, appraising, coordi-

Developing strategies for devel- nating the inspection, monitoring
opment, evaluating the results and evaluation of the effective-
of strategy implementation and ness of investments, investment
proposing strategic changes for projects under the authority of
the whole Group the Board of Directors.
Promote the implementation Supervise and supervise the

of the Group’s strategy and implementation of invest-
development plan. ment projects of the Group.
STRATEGY
AND INVESTMENT
DEPARTMENT Proposing, monitoring and
evaluating the performance
of the Group, managing the
Develop policies and princi-
Group’s investment capital
CHAIRING
ples for short, medium and
in subsidiaries and joint
long-term development
ventures.
THE EVALUATION OF THE
INVESTMENT POLICIES,
INVESTMENT RESULTS
BASED ON THE GROUP’S 3.2.
CRITERIA, REPORTING THE STRATEGY AND INVESTMENT DEPARTMENT
EVALUATION TO THE BOARD
OF DIRECTORS.
3.2.1. Function and mission • Checking, supervising the implementa- »» Researching, proposing the manage- agement, Group’s economic - techni- »» Co-operating with other specialized
tion of the Group’s investment projects ment methods in order to push the cal norms Departments and the company’s su-
The Strategic Investment Department is one implementation of Group’s approved pervisors to appraise, report and draft
part of administrative structure of the Viet- • Proposing, following and assessing the oriented development as well as de- »» Proposing solutions to improve the of the Board of Directors’s decisions
Nam National Petroleum Group. Its main company’s operation efficiency, admin- velopment strategy. Taking part in efficiency, quality and investment in investment projects (both direct and
functions are: istering Group’s fund in subsidiaries, supervising the goals implementation scopes of Corporations of which more indirect) and in selling the Group’s
multi-owned joint venture companies. and solutions of oriented develop- than 50% of authorized capital is fixed assets as well as Group mem-
• C
onstructing development strategies, owned by the Group.
ment strategy which were approved ber’s fixed assets
evaluating the results of executing the The main duties of Board are as below:
by Board of Management
strategies as well as proposing changes »» Chairing the evaluation of the in- »» Chairing and co-operating with oth-
in Group’s strategies • Regarding the Group’s development vestment policies, investment results
»» Proposing solutions for amendment er specialized Department, Group’s
strategy based on the Group’s criteria, report-
and improvement of the Group’s de- functional units, Corporation mem-
• Implementing Group’s strategies and ing the evaluation to the Board of Di-
»» Chairing the research and co-opera- velopment strategies as well as busi- bers to propose co-operative items;
development plans rectors.
tion with other related functional divi- ness strategies of its Subsidiaries, periodically checking and assessing
• Issuing policies and principles of short sions in developing the Group’s gen- Group’s Joint Venture companies the effectiveness of the co-opera-
3.2.2. Department’s Activites in 2017
term, middle term, long term investment eral development strategies which comply with current regulation between the Group and strategic
and development tions, and are in line with Group’s de- In 2017, the Strategic and Investment de- shareholders
»» Identifying the basic development velopment strategy. partment fulfilled its specialized dutied as
• Proposing, appraising, co-operating in targets of the Group’s in each peri- below:
checking, supervising and assessing od, ensuring they are in line with the • Regarding Group’s investment manage-
the effectiveness of investment projects Group’s general development strate- ment »» In charge of completing legal proce-
which are under the jurisdiction of the gy,reporting to the Board of Directors dures and acquiring relevant licenses
»» P
roposing, amending, appraising pol-
Board of Directors for approval. for PLX to be listed on HOSE
icies on the Group’s investment man-
104 PETROLIMEX
PETROLIMEX
3.4.
DEPARTMENT OF HUMAN RESOURCES, WAGES AND BONUSES
3.4.1. Function and mission »» R

esearching and proposing the hi- amended the staff scheduling in the
erarchical organizational models for period of 2017 - 2021, established
the Group’s manufacturing - business the new staff scheduling for the period
MAIN FUNCTIONS system which are suitable with each of 2015 - 2025 with new job titles for
period of development management staffs
• Development strategies of
Group’s Human Resources »» Training the Group’s staffs, apprais- »» Staff appointing: 1 member of Group’s
ing the assessment process and staff Board of Director and 3 Group’s Dep-
• T
he Group’s organization and
- exchange schemes uty General Director have been ap-
labor management under the
pointed.
control of the Group’s Board of • Wage, Bonus and benefit package policy
Management • Wage, Bonus and Remuneration:
»» R
esearching to issue protocols and
• Labor management as well as policies on management of labor, »» A
ppraising wage, bonus and remu-
the Group’s policies in wage, wage, bonus, remuneration and ben- neration fund of 2016 and 2017 pro-
bonus and benefit package. efit package for the Group’s staff posed by the Group and the Supervi-
sory Board before the Annual General
»» Supervising the abidance of the La- Meeting
bor Code as well as labor and training
Its main functions include: policies »» Researching labor and wage pro-
posal in accordance with Decree No
• D
evelopment strategy for Human Re- 3.4.2. Departments performance in 2017
3.3. sources
53/2016/ND-CP, Circular No 28/2016/
TT-BLDTB&XH of Ministry of Labor,
AUDIT DEPARTMENT • Labor Organization
invalids and social affairs; construct-
»» R
esearching for periodic development
»» Organization: Appraising proposals ing the salary scheme applied to joint
strategies and proposing them to the
and reporting them to the Board of Di- stock companies, Limited Liabilities
3.3.1. Function and mission Board of Directors for approvals
rectors for approval for the company companies using Group’s controlled
»» Checking and supervising target im- management structure, management capitalism.
The Audit Department is one of 4 Depart- 3.3.2. Department’s Activities in 2017
ments directly under the Board of Manage- plementation and strategic solutions of organizational system in hierarchy,
MAIN FUNCTIONS ment with its main functions as below: In 2017, Audit Department has met all of its for developing of the Group’s Human establishment of Petrolimex Trans-
targets as below: Resources. portation Services company, group of
• C
onsulting and assisting the • Appraising the annual Financial State- assistants for Supervisory Board, etc
Board of Directors in the fol- ment of the Group and its divisions to • Following the command of the Board • Staff organization
lowing fields: Supervision, con- report to the Board of Management of Directors, co-operating with other »» Staff scheduling: Board reviewed and
struction and perfecting the departments in the re-organization and
internal management system, • Assisting the Board of Directors in the establishment of Petrolimex Transporta-
financing and accounting, risk financial and accounting fields in the tion Services Corporation
management and compliance scope of rank and jurisdiction
• Checking and supervising at some di-
• Assessing and internally con- • Constructing plans and implementing in- visions as planned, co-operating with
sulting in an independent and ternal audit in the Group and its divisions the Supervisory Board in spontaneous
objective manner, identifying Supervising campaigns at 9 Petroleum
existing and potential errors, • Based on the results of internal auditing, companies
risks in manufacturing-business proposing advice and solutions to the
and management process of Board of Directors • Drafting the proposal of issuing the
Group and Group’s divisions, policies on Financial Management
proposing the solutions to solve • Checking, supervising the proposals (samples) applying to domestic single
these above problems and commanding after auditing member Limited Liability Companies;
appraising and reporting to Board of Di-
• Proposing improvement solu- rectors in order to issue Financial Pol-
tions for the command system icies based on the proposals of compa-
of the Group’s manufactur- nies’ Chairmans in line with the Policies
ing-business activities, financ- in Financial Management (samples) and
ing and accounting management specialties for 43 domestic
Petroleum Companies
106 PETROLIMEX
PETROLIMEX
4. TRANSACTIONS, REMUNERATION AND

BENEFIT PACKAGES OF THE BOARD OF
DIRECTORS, AND THE SUPERVISORY
BOARD, BOARD OF MANAGEMENT
4.1.
SALARY, BONUS AND BENEFIT
PACKAGE
The payment of wages, bonuses and oth- Other cost of operation of the Supervisory
er incomes of the Board of Management, Board or Supervisors was in accordance
Group Chief Accountant are paid in accor- with Group’s current policies.
dance with the regulations on salaries, bo-
nuses and other current regulations of the Internal stock transactions
Group in accordance with the regulations of
Transaction Relationship with Period of January, Period of December, Reason of
Order
the State.; increas-

executors internals 1st, 2017 31st, 2017
ing/ de-
Number Owner- Number Ownership creasing
• S
alary, bonus and other income of the
of shares ship ratio of shares ratio (%
Group’s Board of Directors and Chief held (%) held
Accountant were paid in accordance Le Thi Kim Mr. Le Van Huong's elder
1 900 0.0001 0 0 Sold
with the State’s current compensation Huyen sister
regime complied by the Group Le Thi Thu Mr. Le Van Hương's
2 1,400 0.0001 3,000 0.00023 Inherited
Ha younger sister
• Bonus (if any) of the Board of Directors Pham Quoc Mr. Pham Duc Thang's
will be deducted from Profit after tax and 3 5,000 0.0004 0 0 Sold
Toan elder brother
executed in accordance with Group’s Dinh Ngoc Mr Dinh Viet Tien's elder
regulations of financial management 4 3,900 0.0003 0 0 Sold
Sau brother
Nguyen Vinh
• Other income will be paid in accordance 5 Supervisor 6,000 0.0005 1,000 0 Sold
Thanh
with the State’s labor policies applied by
Dang Hong Ms. Dang Thi Hong Ha's
the Group 6 2,433 0.0002 1,033 0.00008 Sold
Lien younger sister
Nguyen
• According to the 2017 compensation 7 Deputy General Director 10,452 0.0008 1,452 0.00011 Sold
Quang Kien
and provisions scheme for the Group’s
Nguyen Mr. Nguyen Quang
Board Members and Supervisory Board, 8
Quang Lap Kien's younger brother
5,000 0.0004 0 0 Sold
the actual payroll which was approved at
Luu Van
the Annual General Meeting included: 9
Tuyen
Chief Accountant 12,000 0.0009 0 0 Sold
a/ The remuneration for the Board of Di- Tran Diem

10 Mr. Luu Van Tuyen's wife 1,000 0.0001 0 0 Sold
Hong
rectors, concurrently on the Group’s
Head of Audit Depart-
Board of Directors (including Gener- 11 Le Duc Loi 17,800 0.0014 0 0 Sold
ment -Board of Directors
al Director, Deputy General Director,
Chief Accountant): 9.109.290.000 12 Le Anh Duc Mr. Le Van Minh' s son 300 0.00002 0 0 Sold
VND;
Le Duc Mr. Le Duc Loi's young-
13 2,500 0.0002 0 0 Sold
Hoanh er brother
b/ The remuneration of Supervisory
Board: 6.755.271.000 VND.
4.2.
c/ The salary of specialized Board mem-
bers and the remuneration of concur- CONTRACTS OR TRANSACTIONS WITH
rent Board members: 4.113.090.000 INTERNAL SHAREHOLDERS None
VND;
06.CONSOLIDATED
FINANCIAL STATEMENTS
PETROLIMEX
GAS
110 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
GROUP Establishment Documents STATEMENT The Board of General Directors of Vietnam National Petroleum Group (“the Group”) pres-
ents this statement and the accompanying consolidated financial statements of the Group
CORPORATE Decision No. 224/QD-TTg dated 14 April 1995 of the Prime Minister on establishment of OF THE BOARD for the year ended 31 December 2017.
INFORMATION Vietnam National Petroleum Corporation. OF GENERAL The Group’s Board of General Directors is responsible for the preparation and fair presen-
Decision No. 828/QD-TTg dated 31 May 2011 of the Prime Minister on the approval of the DIRECTORS tation of the consolidated financial statements in accordance with Vietnamese Accounting
equitisation and restructuring plan of Vietnam National Petroleum Corporation. Standards, the Vietnamese Accounting System for enterprises and the relevant statutory
requirements applicable to financial reporting. In the opinion of the Group’s Board of Gen-
Business Registration Certificate No. 0100107370 initially issued by the Hanoi Department eral Directors:
of Planning and Investment on 5 May 1995. The Business Registration Certificate has been
amended several times, the most recent of which is by Business Registration Certificate (a) the consolidated financial statements set out on pages 5 to 63 give a true and
dated 1 November 2017. fair view of the consolidated financial position of the Group as at 31 December
2017, and of the consolidated results of operations and the consolidated cash flows
of the Group for the year then ended in accordance with Vietnamese Accounting
Board of Management
Standards, the Vietnamese Accounting System for enterprises and the relevant
Mr. Bui Ngoc Bao Chairman statutory requirements applicable to financial reporting; and
Mr. Nguyen Thanh Son Member
Mr. Nguyen Duc Thang Member (b) at the date of this statement, there are no reasons to believe that the Group will
Mr. Tran Ngoc Nam Member not be able to pay its debts as and when they fall due.
Mr. Le Van Huong Member
On the date of this statement, the Group’s Board of General Directors has authorised the
Mr. Nguyen Anh Dung Member
accompanying consolidated financial statements for issue.
Mr. Hitoshi Kato Member
Mr. Vu Ba Phu Member (until 27/11/2017)
Mr. Pham Van Thanh Member (from 25/4/2017)
Board of General Directors
Mr. Pham Duc Thang General Director (from 2/11/2017) On behalf of the Board of General Directors
Mr. Tran Van Thinh General Director (until 1/11/2017)
Mr. Pham Duc Thang Deputy General Director (until 1/11/2017)
Mr. Nguyen Quang Kien Deputy General Director (until 1/10/2017)
Mr. Vuong Thai Dung Deputy General Director
Mr. Tran Ngoc Nam Deputy General Director
Mr. Vu Ba Phu Deputy General Director (until 27/11/2017)
Mr. Nguyen Quang Dung Deputy General Director (from 1/4/2017)
Mr. Nguyen Van Su Deputy General Director (from 1/4/2017) Pham Duc Thang
Mr. Dao Nam Hai Deputy General Director (from 1/10/2017) General Director
Hanoi, 30 March 2018

Registered Office
No. 1, Kham Thien Street, Dong Da District, Hanoi, Vietnam
Auditor
KPMG Limited Vietnam

112 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
INDEPENDENT To: The Shareholders

The Board of Management and the Board of General Directors
CONSOLIDATED BALANCE SHEET Form B 01 – DN/HN
(Issued under Circular No. 202/2014/TT-BTC
AUDITOR’S REPORT Vietnam National Petroleum Group AS AT 31 DECEMBER 2017 dated 22 December 2014 of the Ministry of Finance)
We have audited the accompanying consolidated financial statements of Vietnam National

Petroleum Group (“the Group”), which comprise the consolidated balance sheet as at 31 De- CODE NOTE 31/12/2017 1/1/2017
VND VND
cember 2017, the consolidated statements of income and cash flows for the year then ended
and the explanatory notes thereto which were authorised for issue by the Group’s Board of ASSETS
General Directors on 30 March 2018, as set out on pages 5 to 63.
CURRENT ASSETS (100 = 110 + 120 + 130 + 140 + 150) 100 40,526,370,730,962 33,376,137,739,565
MANAGEMENT’S RESPONSIBILITY The Group’s Board of General Directors is responsible for the preparation and fair presen-
tation of these consolidated financial statements in accordance with Vietnamese Account- Cash and cash equivalents 110 6 14,223,421,508,261 11,353,600,192,147
ing Standards, the Vietnamese Accounting System for enterprises and the relevant statutory
Cash 111 5,705,904,913,235 4,342,083,888,717
requirements applicable to financial reporting, and for such internal control as the Board of
General Directors determines is necessary to enable the preparation of consolidated financial Cash equivalents 112 8,517,516,595,026 7,011,516,303,430
statements that are free from material misstatement, whether due to fraud or error.
Short-term financial investments 120 2,505,007,709,502 2,653,613,962,495
AUDITOR’S RESPONSIBILITY Our responsibility is to express an opinion on these consolidated financial statements based
on our audit. We conducted our audit in accordance with Vietnamese Standards on Auditing. Trading securities 121 7(a) 6,021,246,000 79,115,638,400
Those standards require that we comply with ethical requirements and plan and perform the
Allowance for diminution in the value of trading securities 122 7(a) (2,053,067,986) (20,195,072,393)
audit to obtain reasonable assurance about whether the consolidated financial statements
are free of material misstatement. Held-to-maturity investments 123 7(b) 2,501,039,531,488 2,594,693,396,488
An audit involves performing procedures to obtain audit evidence about the amounts and Accounts receivable – short-term 130 7,462,114,111,441 6,918,359,545,312
disclosures in the financial statements. The procedures selected depend on the auditor’s
judgement, including the assessment of the risks of material misstatement of the consolidated Accounts receivable from customers 131 8 6,811,902,244,793 6,184,468,795,660
financial statements, whether due to fraud or error. In making those risk assessments, the
Prepayments to suppliers 132 374,679,687,768 454,056,722,166
auditor considers internal control relevant to the Group’s preparation and fair presentation
of the financial statements in order to design audit procedures that are appropriate in the Other receivables 136 9 590,517,831,399 703,404,307,083
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Allowance for doubtful debts 137 (315,787,838,951) (424,450,707,637)
Group’s internal control. An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of accounting estimates made by the Group’s Board of Shortage of assets awaiting resolution 139 802,186,432 880,428,040
General Directors, as well as evaluating the overall presentation of the financial statements.
Inventories 140 10 12,867,551,209,134 8,627,059,190,050
We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our audit opinion. Inventories 141 12,890,760,772,088 8,643,776,356,784
AUDITOR’S OPINION In our opinion, the consolidated financial statements give a true and fair view, in all material Allowance for inventories 149 (23,209,562,954) (16,717,166,734)
respects, of the consolidated financial position of Vietnam National Petroleum Group as at 31
Other current assets 150 3,468,276,192,624 3,823,504,849,561
December 2017, and of its consolidated results of operations and its consolidated cash flows
for the year then ended in accordance with Vietnamese Accounting Standards, the Vietnam- Short-term prepaid expenses 151 217,282,436,389 270,755,270,527
ese Accounting System for enterprises and the relevant statutory requirements applicable to
financial reporting. Deductible value added tax 152 305,744,694,520 277,155,321,710
Taxes and others receivable from State Treasury 153 17 2,910,198,024,758 2,156,306,559,062
Other current assets 155 35,051,036,957 1,119,287,698,262

114 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
CONSOLIDATED BALANCE SHEET Mẫu B 01 – DN/HN

(Ban hành theo Thông tư số 202/2014/TT-BTC
AS AT 31 DECEMBER 2017 (continued) ngày 22/12/2014 của Bộ Tài chính)
CODE NOTE 31/12/2017 1/1/2017 CODE NOTE 31/12/2017 1/1/2017

VND VND VND VND
LONG-TERM ASSETS (200 = 210 + 220 + 230 + 240 + 250 + 260) 200 21,242,690,361,597 20,868,296,752,133 RESOURCES
Accounts receivable – long-term 210 88,684,537,328 47,611,240,582 LIABILITIES (300 = 310 + 330) 300 38,385,075,927,607 31,043,829,442,660
Accounts receivable from customers – long-term 211 75,342,051,954 36,068,203,527 Current liabilities 310 35,757,792,050,085 27,941,980,070,519
Other long-term receivables 216 40,103,033,030 50,457,255,082 Accounts payable to suppliers 311 16 15,270,928,443,422 11,522,669,163,818
Allowance for doubtful long-term debts 219 (26,760,547,656) (38,914,218,027) Advances from customers 312 200,891,527,721 526,600,619,415
Fixed assets 220 15,270,763,892,934 15,646,073,853,005 Taxes and others payable to State Treasury 313 17 1,730,337,723,799 2,096,667,226,664
Tangible fixed assets 221 11 13,325,714,869,802 13,751,375,772,196 Payables to employees 314 922,143,296,413 1,053,483,580,467
Cost 222 29,308,854,603,054 28,224,171,557,650 Accrued expenses 315 268,697,389,078 185,383,858,808
Accumulated depreciation 223 (15,983,139,733,252) (14,472,795,785,454) Unearned revenue – short-term 318 13,064,987,675 75,041,994,171
Intangible fixed assets 227 12 1,945,049,023,132 1,894,698,080,809 Other payables – short-term 319 18 243,367,242,706 373,542,415,375
Cost 228 2,488,000,589,322 2,372,949,231,584 Short-term borrowings 320 19(a) 13,745,080,780,307 7,038,009,632,280
Accumulated amortisation 229 (542,951,566,190) (478,251,150,775) Provisions – short-term 321 20 44,890,213,714 2,968,182,984,991
Investment property 230 13 165,266,207,789 256,182,851,727 Bonus and welfare funds 322 278,309,850,371 271,420,528,510
Cost 231 221,292,437,042 314,367,780,418 Petroleum price stabilisation fund 323 21 3,040,080,594,879 1,830,978,066,020
Accumulated depreciation 232 (56,026,229,253) (58,184,928,691) Long-term liabilities 330 2,627,283,877,522 3,101,849,372,141
Long-term work in progress 240 780,123,324,785 604,702,429,151 Long-term advances from customers 332 10,897,063,530 11,210,863,970
Long-term work in progress 241 2,393,855,199 - Long-term accrued expenses 333 908,435,872 290,467,540
Construction in progress 242 14 777,729,469,586 604,702,429,151 Long-term unearned revenue 336 14,478,816,904 9,144,815,444
Long-term financial investments 250 2,883,912,021,826 2,380,992,710,474 Other payables – long-term 337 167,086,416,528 201,887,838,383
Investments in associates, joint-ventures 252 7(d) 2,677,987,826,627 2,028,073,452,777 Long-term borrowings 338 19(b) 2,406,437,211,735 2,852,388,509,980
Equity investments in other entities 253 7(e) 315,196,457,265 355,674,275,616 Deferred tax liabilities 341 5,342,959,580 4,878,702,501
Allowance for diminution in the value of long-term financial investments 254 (110,772,262,066) (115,155,017,919) Provisions – long-term 342 19,067,212,373 10,543,121,369
Held-to-maturity investments 255 7(b) 1,500,000,000 112,400,000,000 Science and technology development fund 343 3,065,761,000 11,505,052,954
Other long-term assets 260 2,053,940,376,935 1,932,733,667,194
Long-term prepaid expenses 261 15 2,018,235,656,410 1,913,707,367,823
Deferred tax assets 262 32,964,618,879 11,057,162,186
Long-term tools, supplies and spare parts 263 22,118,300 22,118,300
Other long-term assets 268 2,717,983,346 7,947,018,885
TOTAL ASSETS (270 = 100 + 200) 270 61,769,061,092,559 54,244,434,491,698

116 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
CONSOLIDATED BALANCE SHEET CONSOLIDATED STATEMENT OF INCOME

AS AT 31 DECEMBER 2017 (continued) Form B 01 – DN/HN
FOR THE YEAR ENDED 31 DECEMBER 2017
Form B 02 – DN/HN
dated 22 December 2014 of the Ministry of Finance) (Issued under Circular No. 202/2014/TT-BTC
dated 22 December 2014 of the Ministry of Finance)
CODE NOTE 31/12/2017 1/1/2017 CODE NOTE 2017 2016

VND VND VND VND
EQUITY (400 = 410) 400 23,383,985,164,952 23,200,605,049,038 Revenue from sales of goods and provision of services 100 153,736,210,568,322 123,127,176,864,983
Owners’ equity 410 12,938,780,810,000 12,938,780,810,000 Revenue deductions 02 39,153,702,504 30,659,848,663
Share capital 411 Net revenue (10 = 01 - 02) 10 4 153,697,056,865,818 123,096,517,016,320
Ordinary shares with voting rights 411a 12,938,780,810,000 12,938,780,810,000 Cost of sales 11 4 141,400,532,111,654 108,891,432,070,956
Capital surplus/Share premium 412 2,246,997,553,623 3,003,630,250,509 Gross profit (20 = 10 - 11) 20 12,296,524,754,164 14,205,084,945,364
Other capital 414 1,132,410,233,797 990,113,907,720 Financial income 21 27 791,143,396,401 879,878,586,647
Treasury shares 415 (1,350,648,460,000) (1,550,648,460,000) Financial expenses 22 28 790,644,542,111 844,097,800,840
Differences upon asset revaluation 416 (1,317,118,937,352) (1,317,118,937,352) In which: Interest expense 23 570,685,109,732 551,519,187,171
Foreign exchange differences 417 5,425,927,848 (73,836,949,005) Share of profit in associates and joint ventures 24 29 456,054,595,116 599,747,414,012
Investment and development fund 418 951,687,189,578 743,691,793,605 Selling expenses 25 30 7,320,736,564,998 7,701,328,853,813
Other equity funds 420 1,333,225,579,172 80,994,720,997 General and administration expenses 26 817,994,151,452 1,016,549,078,091
Retained profits 421 4,578,569,554,201 5,162,212,103,107 Net operating profit

30 4,614,347,487,120 6,122,735,213,279
{30 = 20 + (21 - 22) + 24 - (25 + 26)}
Retained profits brought forward 421a 1,110,299,944,068 5,162,212,103,107
Other income 31 324,762,583,078 336,689,016,471
Retained profit for the current year 421b 3,468,269,610,133 -

Other expenses 32 154,142,930,181 159,237,718,400
Non-controlling interest 429 2,864,655,714,085 3,222,785,809,457

Results of other activities (40 = 31 - 32) 40 170,619,652,897 177,451,298,071
TOTAL RESOURCES (440 = 300 + 400) 440 61,769,061,092,559 54,244,434,491,698

Accounting profit before tax (50 = 30 + 40) 50 4,784,967,140,017 6,300,186,511,350
Income tax expense – current 51 32 894,833,667,465 1,152,206,706,935
30 MARCH 2018 Income tax (benefit)/expense – deferred 52 32 (21,529,227,908) 546,182,104
Net profit after tax (60 = 50 - 51 - 52)

Prepared by: Approved by: 60 3,911,662,700,460 5,147,433,622,311
(to be repeated in next page)
Dang Hong Lien Luu Van Tuyen Pham Duc Thang

Accountant Chief Accountant General Director
118 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
BÁO CÁO KẾT QUẢ HOẠT ĐỘNG KINH CONSOLIDATED STATEMENT OF CASH FLOWS
DOANH HỢP NHẤT CHO NĂM KẾT THÚC Mẫu B 02 – DN/HN
(Ban hành theo Thông tư số 202/2014/TT-BTC
NGÀY 31 THÁNG 12 NĂM 2017 (tiếp theo) ngày 22/12/2014 của Bộ Tài chính) (INDIRECT METHOD) Form B 03 – DN/HN
CODE NOTE 2017 2016 CODE NOTE 31/12/2017 1/1/2017

VND VND VND VND
Net profit after tax (60 = 50 - 51 - 52)

60 3,911,662,700,460 5,147,433,622,311 CASH FLOWS FROM OPERATING ACTIVITIES
(repeated from previous page)
Accounting profit before tax 01 4,784,967,140,017 6,300,186,511,350
Attributable to:
Adjustments for
Equity holders of the Parent Company 61 3,468,269,610,133 4,669,396,347,454
Depreciation and amortisation 02 2,270,612,080,495 2,051,896,891,805

Non-controlling interest 62 443,393,090,327 478,037,274,857
Allowances and provisions 03 159,296,827,871 346,318,924,548

Earnings per share
Exchange (gains)/losses arising from revaluation of monetary items
Basic earnings per share 70 3,013 4,254 04 (6,469,072,880) 53,001,251,108
denominated in foreign currencies
Profits from investing activities 05 (1,004,973,777,952) (1,062,714,229,417)
30 MARCH 2018 Interest expense 06 598,685,461,893 551,519,187,171
Other adjustments 07 1,196,555,262,908 (551,581,632,368)

Prepared by: Approved by:
Operating profit before changes in working capital 08 7,998,673,922,352 7,688,626,904,197
Change in receivables 09 1,320,871,822,290 (1,370,381,403,294)
Change in inventories 10 (4,246,984,415,304) (921,553,149,234)
Change in payables and other liabilities 11 (1,415,655,866,905) 1,175,426,196,530
Change in prepaid expenses 12 115,316,915,176 14,812,871,971
Change in trading securities 13 73,094,392,400 (9,451,096,350)

Accountant Chief Accountant General Director 3,845,316,770,009 6,577,480,323,820
Interest paid 14 (573,420,957,022) (554,449,689,474)
Income tax paid 15 (1,118,582,308,573) (996,433,419,940)
Other payments for operating activities 17 (376,357,477,508) (355,332,943,620)
Net cash flows from operating activities 20 1,776,956,026,906 4,671,264,270,786

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CONSOLIDATED STATEMENT OF CASH FLOWS NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2017 FOR THE YEAR ENDED 31 DECEMBER 2017
Form B 03 – DN/HN
(INDIRECT METHOD) (continued) (Issued under Circular No. 202/2014/TT-BTC
These notes form an integral part of and should be read in conjunction with the accompanying consol-
idated financial statements..
CODE NOTE 31/12/2017 1/1/2017
VND VND
1. REPORTING ENTITY
CASH FLOWS FROM INVESTING ACTIVITIES
(a) Ownership structure Vietnam National Petroleum Group (the “Group”), previously known as Vietnam National Petroleum Cor-
Payments for additions to fixed assets and other long-term assets 21 (2,982,894,528,958) (3,196,021,764,726) poration, a state-owned company operating in the petroleum business, was established under Decision
No. 224/QD-TTg dated 14 April 1995 by the Prime Minister. The Group was granted a special rank by the
Proceeds from disposals of fixed assets and other long-term assets 22 51,452,367,096 17,267,819,957 Prime Minister under Decision No. 186/TTg dated 28 March 1996, aiming at enhancement of concentration,
Payments for granting loans, purchase of debt instruments of other specialisation and cooperation in production and business to execute the functions assigned by the State,
23 (1,293,169,981,996) (803,959,056,409)
entities improving the competence and efficiency of member companies and the Group and meeting the require-
Receipts from collecting loans, sales of debt instruments of other ments for development of the economy.
24 990,328,871,530 491,447,041,099
entities
In accordance with Decision No. 828/QD-TTg dated 31 May 2011 by the Prime Minister on the approval of
Payments for investments in other entities 25 (157,898,398,040) (12,422,595,000) the equitisation and restructuring plan of Vietnam National Petroleum Corporation and Business Registra-
tion Certificate No. 0100107370 dated 1 December 2011, Vietnam National Petroleum Corporation officially
Collections on investments in other entities 26 - 149,368,225,254
changed to a joint stock company on 1 December 2011 and become Vietnam National Petroleum Group.
Receipts of interests, dividends and share of profit 27 1,110,351,521,356 1,204,998,730,199 The Group inherited all rights and obligations from Vietnam National Petroleum Corporation in accordance
with legal regulations.
Net cash flows from investing activities 30 (2,281,830,149,012) (2,149,321,599,626)
CASH FLOWS FROM FINANCING ACTIVITIES (b) Hoạt động chính The Group undertakes the function of investment and development of petroleum trading activities according
to the State’s scheme on commercial industry development. The Group’s principal activities include oper-
Proceeds from equity issued 31 - 4,060,747,688,565 ating petroleum warehouses, petroleum ports; surveying, designing and constructing petroleum and civil
works; importing/exporting and trading petroleum, petrochemical products and materials and equipment for
Proceeds from transfer of treasury shares 31 1,009,403,435,910 (497,098,935,736)
petroleum industry and other industries, hospitality services and travel services. In addition, the Group has
Proceeds from borrowings 33 68,116,310,955,538 60,003,690,853,987 the rights to operate in multi-industry business according to the State’s regulations, as well as to perform
other functions assigned by the State.
Payments to settle loan principals 34 (61,722,389,111,374) (65,849,135,660,051)
Payments of dividends 36 (3,978,082,311,460) (149,962,178,105) (c) Normal operating cycle The normal operating cycle of the Group is generally within 12 months..
Net cash flows from financing activities 40 3,425,242,968,614 (2,431,758,231,340)

(d) Group structure The Group structure comprises of the Parent Company - Vietnam National Petroleum Group (“the Parent
Net cash flows during the year (50 = 20 + 30 + 40) 50 2,920,368,846,508 90,184,439,820 Company”) and member companies. As at 31 December 2017, the Group had 62 subsidiaries including
43 petroleum companies fully owned by the Group within its Petroleum Division and 19 other subsidiaries
Cash and cash equivalents at the beginning of the year 60 11,353,600,192,147 11,288,673,192,851
(1/1/2017: 70 subsidiaries) as listed in Note 7(c), 1 joint venture and 15 associates (1/1/2017: 1 joint venture
Effect of exchange rate fluctuations on cash and cash equivalents 61 (50,547,530,394) (25,257,440,524) and 13 associates) ) as listed in Note 7(d).
Cash and cash equivalents at the end of the year (70 = 50 + 60 + 61) 70 6 14,223,421,508,261 11,353,600,192,147
As at 31 December 2017, the Group had 20,259 employees (1/1/2017: 27,480 employees)..
30 MARCH 2018

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2. BASIS OF PREPARATION
(a) Statement of compliance The consolidated financial statements have been prepared in accordance with Vietnamese Accounting One of the Group’s associates is Petrolimex Joint Stock Insurance Company (“PJICO”) which operates in
Standards, the Vietnamese Accounting System for enterprises and the relevant statutory requirements the insurance sector and one is Petrolimex Group Commercial Joint Stock Bank (“PG Bank”) which oper-
applicable to financial reporting. ates in the banking sector. The Board of General Directors of the Parent Company assessed the effect of
prevailing regulations on capital contribution in insurance and banking activities under Decree No. 91/2015/
(b) Basis of measurement ND-CP dated 13 October 2015 of the Government on investment of state capital in enterprises and man-
The consolidated financial statements, except for the consolidated statement of cash flows, are prepared on
agement and use of capital and assets in enterprises. Accordingly, the Group had a plan for divestment
the accrual basis using the historical cost concept. The consolidated statement of cash flows is prepared
from these associates.
using the indirect method.
(v) Transactions eliminated on consolidation

(c) Annual accounting period The annual accounting period of the Group is from 1 January to 31 December.
Intra-group transactions and balances, and any unrealised income and expenses arising from intra-group
transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains and loss-
(d) Đơn vị tiền tệ kế toán The Group’s accounting currency is Vietnam Dong (“VND”), which is also the currency used for consolidat- es arising from transactions with equity accounted investees are eliminated against the investment to the
ed financial statement presentation purpose. extent of the Group’s interest in the investee.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(vi) Business combination
The following significant accounting policies have been adopted by the Group in the preparation of these Business combinations are accounted for using the acquisition method as at the acquisition date, which is
consolidated financial statements. the date on which control is transferred to the Group. Control exists when the Group has the power to gov-
ern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing
(a) Cơ sở hợp nhất (i) Subsidiaries
control, potential voting rights that presently are exercisable are taken into account.
Subsidiaries are entities controlled by the Group. The financial statements of the subsidiaries are consol-
idated in the consolidated financial statements from the date that control commences until the date that
control ceases.
(ii) Non-controlling interests
Non-controlling interests are measured at their proportionate share of the acquiree’s identifiable net assets
at date of acquisition.
Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as
transactions with owners. The difference between the change in the Group’s share of net assets of the
subsidiary and any consideration paid or received is recorded directly in retained profits under equity.
(iii) Loss of control
When the Group losses control over a subsidiary, it derecognizes the assets and liabilities of the subsid-
iary, and any related non-controlling interests and other components of equity. Any resulting gain or loss
is recognised in the consolidated income statement. Any interest retained in the former subsidiary when
control is lost is stated at the carrying amount of the retained investment in the separate financial statements
adjusted for appropriate shares of changes in equity of the investee since the acquisition date, if significant
influence in the investee is maintained, or otherwise stated at cost.
(iv) Associates and jointly controlled entities (equity accounted investees)
Associates are those entities in which the Group has significant influence, but not control, over the financial
and operating policies. Jointly controlled entities (“joint ventures”) are those entities over whose activities
the Group has joint control, established by contractual agreement and requiring unanimous consent for
strategic financial and operating decisions. Associates and jointly controlled entities are accounted for using
the equity method (equity accounted investees). The consolidated financial statements include the Group’s
share of the income and expenses of the equity accounted investees, after adjustments to align the ac-
counting policies with those of the Group, from the date that significant influence or joint control commences
until the date that significant influence or joint control ceases. When the Group’s share of losses exceeds
its interest in an equity accounted investee, the carrying amount of that interest (including any long-term
investments) is reduced to nil and the recognition of further losses is discontinued except to the extent that
the Group has an obligation or has made payments on behalf of the investee.
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(b) Ngoại tệ (i) Foreign currency transactions
Transactions in currencies other than VND during the year have been translated into VND at rates approx-
imating actual rates of exchange ruling at the transaction dates.
Monetary assets and liabilities denominated in currencies other than VND are translated into VND at the
exchange rates at the end of the annual accounting period. The actual rates of exchange applied to re-
translate monetary items denominated in foreign currency at the end of the annual accounting period are
determined as follows:
• For monetary assets (cash on hand, cash in banks and receivables): the foreign currency buying rate
at the reporting date quoted by Joint Stock Commercial Bank for Foreign Trade of Vietnam.
• For monetary liabilities (payables and borrowings): the foreign currency selling rate at the reporting
date quoted by Joint Stock Commercial Bank for Foreign Trade of Vietnam.
All foreign exchange differences are recorded in the consolidated statement of income.
An allowance is made for diminution in investment values if the investee has suffered a loss, except where
(ii) Foreign operations such a loss was anticipated by the Group before making the investment. The allowance is reversed if
the investee subsequently made a profit that offsets the previous loss for which the allowance had been
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on ac- made. An allowance is reversed only to the extent that the investment’s carrying amount does not exceed
quisition, are translated to VND at exchange rates at the end of the annual accounting period. The income the carrying amount that would have been determined if no allowance had been recognised. Allowance for
and expenses of foreign operations are translated to VND at the exchange rates which approximate those diminution in the value of long-term financial investments is made in accordance with guidance in Circular
ruling on the dates of transactions. No. 89/2013/TT-BTC dated 28 June 2013 on amendments and supplements to Circular No. 228/2009/TT-
BTC dated 7 December 2009 of the Ministry of Finance guiding the appropriation and use of allowance for
Foreign currency differences arising from the translation of foreign operations are recognised in the consol- devaluation of inventories, impairment of financial instruments, doubtful debts and warranty for products,
idated balance sheet under the caption “Foreign exchange differences” in equity. goods and construction works at enterprises.
(e) Accounts receivable Trade and other receivables are stated at cost less allowance for doubtful debts.
(c) Cash and cash Cash comprises cash balances and call deposits. Cash equivalents are short-term highly liquid investments
equivalents that are readily convertible to known amounts of cash, are subject to an insignificant risk of changes in Allowance for doubtful debts is made for receivables that are overdue for six months or more, or when the
value, and are held for the purpose of meeting short-term cash commitments rather than for investment or debtor is in dissolution, in bankruptcy, or is experiencing similar difficulties and so may be unable to repay
other purposes. the debt.
(d) Các khoản đầu tư (i) Trading securities

(f) Inventories Inventories are stated at the lower of cost and net realisable value. Cost is determined on a first-in-first-out
Trading securities are those held by the Group for trading purpose i.e. purchased for resale with the aim of basis and includes all costs incurred in bringing the inventories to their present location and condition. Cost
making profits over a short period of time. Trading securities are initially recognised at cost which include in the case of finished goods and work in progress includes raw materials, direct labour and attributable
purchase price plus any directly attributable transaction costs. Subsequent to initial recognition, they are manufacturing overheads. Net realizable value is the estimated selling price of inventory items, less the
measured at cost less allowance for diminution in value. An allowance is made for diminution in value of estimated costs of completion and direct selling expenses.
trading securities if market price of the securities item falls below its carrying amount. The allowance is
reversed if the market price subsequently increases after the allowance was recognised. An allowance is The Group applies the perpetual method of accounting for inventories.
reversed only to the extent that the securities’ carrying amount does not exceed the carrying amount that
The Group provides allowance for inventories for obsolete, damaged and sub-standard inventories and for
has been determined if no allowance had been recognised.
those which have costs higher than net realisable values at the end of the annual accounting period.
(ii) Held-to-maturity investments
(g) Tangible fixed assets (i) Cost
Held-to-maturity investments are those that the Board of General Directors has the intention and ability to
hold until maturity. Held-to-maturity investments include term deposits at bank, bonds, redeemable prefer- Tangible fixed assets are stated at cost less accumulated depreciation. The initial cost of a tangible fixed
ence shares which the issuers are required to repurchase at a certain date and loans receivable held to asset comprises its purchase price, including import duties, non-refundable purchase taxes and any directly
maturity. These investments are stated at costs less allowance for doubtful debts. attributable costs of bringing the asset to its working condition for its intended use.
(iii) Investments in equity instruments of other entities Expenditure incurred after tangible fixed assets have been put into operation, such as repair, maintenance
and overhaul cost, is charged to the consolidated statement of income in the year in which the cost is in-
Investments in in equity instruments of other entities are initially recognised at cost which include purchase
curred. In situations where it can be clearly demonstrated that the expenditure has resulted in an increase
price plus any directly attributable transaction costs. Subsequent to initial recognition, these investment are
in the future economic benefits expected to be obtained from the use of tangible fixed assets beyond their
stated at cost less allowance for diminution in value.
originally assessed standard of performance, the expenditure is capitalised as an additional cost of tangible
fixed assets.
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(ii) Depreciation
(ii) Depreciation
Depreciation of tangible fixed assets is computed on a straight-line basis over the estimated useful lives in
accordance with Decision 491/PLX-QD-HDQT dated 7 December 2011 of the Vietnam National Petroleum Depreciation is computed on a straight-line basis over the estimated useful lives of investment property for
Group providing guidance on management, use and depreciation of fixed assets, applied to member com- 35 to 50 years.
panies and Circular No. 45/2013/TT-BTC dated 25 April 2013 of the Ministry of Finance providing guidance
on management, use and depreciation of fixed assets (“Circular 45”). The estimated useful lives are as
(j) Construction in progress Construction in progress represents the costs of construction and machinery which have not been fully com-
follows:
pleted or installed. No depreciation is provided for construction in progress during the period of construction
• Buildings and structures 10 – 35 years and installation.
• Machinery and equipment 5 – 15 years

(k) Long-term prepaid (i) Cylinders
• Motor vehicles 8 – 20 years expenses
The Group adopted the guidance in Official Letter No. 7640/CV-BTC dated 21 June 2005, Official Letter No.
• Equipment, management tools 4 – 6 years 7776/BTC-TCT dated 2 June 2009 of the Ministry of Finance and Circular No. 118/2010/TT-BTC dated 10
August 2010 of the Ministry of Finance guiding financial and tax regimes applicable to traders of bottled liq-
• Others 10 years uefied petroleum gas in recognition and amortization of cylinder values and deposits for cylinders. Accord-
ingly, cylinder values are presented in long-term prepayments and amortised in the consolidated statement
(h) Tài sản cố định vô hình Intangible fixed assets comprise land use rights, software, licence of the software and other intangible fixed of income over a period ranging from 5 to 10 years.
assets.
(ii) Business advantages related to equitisation
(i) Land use rights
Business advantages related to equitisation of Vietnam National Petroleum Corporation are determined
Land use rights are any costs actually incurred in conjunction with securing the land use rights including and recognised in accordance with Decree No. 59/2011/ND-CP dated 18 July 2011 of the Government
costs for land clearance and levelling. on conversion of 100% state-owned enterprises into joint stock companies (“Decree 59”) and Circular No.
202/2011/TT-BTC dated 30 December 2011 of the Ministry of Finance guiding the implementation of Decree
Land use rights comprise: 59. Accordingly, the value of business advantages to be included in the valuation of an equitised enterprise
comprises the value of its trade name and potential for development. The value of trade name is determined
• those granted by the State for which land use payments are collected; based on actual costs incurred for formulation and protection of band names and trade names during the
normal course of business prior to the date of valuation of the enterprise. The potential for development is
• those acquired in a legitimate transfer; and
determined based on the book value of the state-owned capital at the date of valuation multiplied by the
• rights to use leased land obtained before the effective date of the 2003 Land Law for which payments difference between the average ratio of profit after tax to owners’ equity of three years prior to the date of
have been made in advance for more than 5 years and supported by land use right certificate issued valuation and the interest rate of 5-year term government bonds announced by the Ministry of Finance at
by competent authority. the date closest to the date of valuation.
Land use rights are stated at cost less accumulated amortisation. Definite land use rights are amortised The business advantages determined during evaluation for equitisation of Vietnam National Petroleum
on a straight-line basis over the term of the land use. No amortisation is computed for indefinite land use Corporation amounted to VND542,140,339,196 and are amortised in the consolidated statement of income
rights by the Group. over 10 years from 1 January 2012.
(ii) Software and software licence (iii) Tools and instruments
Software and software licence include any costs incurred until the date that software and software licence Tools and instruments include assets held for use by the Group in the normal course of business whose
are put into use. Software and software licence are amortised on a straight line basis over the estimated costs of individual items are less than VND30 million and therefore not qualified for recognition as fixed
useful lives for 10 years. assets under prevailing regulations. Cost of tools and instruments are amortised on a straight-line basis
over a period ranging over 3 years.
(i) Investment property (i) Cost
held to earn rental
Investment property held to earn rental is stated at cost less accumulated depreciation. The initial cost of (l) Goodwill Goodwill arises on the acquisition of subsidiaries, associates and joint ventures. Goodwill is measured at
an investment property held to earn rental comprises its purchase price, cost of land use rights and any cost less accumulated amortization. Cost of goodwill represents the excess of the cost of the acquisition
directly attributable expenditures of bringing the property to the condition necessary for it to be capable of over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of
operating in the manner intended. Expenditure incurred after the investment property held to earn rental the acquiree. When the excess is negative (gain from bargain purchase), it is recognised immediately in the
has been put into operation, such as repairs and maintenance, is charged to the consolidated statement of consolidated statement of income.
income in the year in which the expenditure is incurred. In situations where it can be clearly demonstrated
Goodwill arising on acquisition of a subsidiary is amortised on a straight-line basis over 5 years. Carrying
that the expenditure has resulted in future economic benefits in excess of the originally assessed standard
value of goodwill arising on acquisition of a subsidiary is written down to recoverable amount as the Board
of performance of the existing investment property held to earn rental, the expenditure is capitalised as an
of General Directors determines that it is not fully recoverable.
additional cost of the investment property.
In respect of equity accounted investees, the carrying amount of goodwill is included in the carrying amount
of the investment and is not amortised
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(m) Trade and other payables Trade and other payables are stated at their cost. (q) Petroleum price The appropriation and utilisation of petroleum price stabilisation fund are made in accordance with Joint
stabilisation fund Circular No. 39/2014/TTLT-BCT-BTC dated 29 October 2014 of the Ministry of Industry and Trade and the
Ministry of Finance on “Method of determination of basic prices and the mechanism for creation, manage-
(n) Technical reserves and Technical reserves and reinsurance assets of the Group represent figures consolidated from Petrolimex
ment and use of Price stabilisation fund and regulation of petrol and oil prices as prescribed in Decree No.
reinsurance assets Joint Stock Insurance Company (until the date that the Group losses control over this company as de-
83/2014/ND-CP dated 3 September 2014 of the Government on petrol and oil trading” (“Circular 39”) and
scribed in Note 5). Technical reserves are established in accordance with regulations and instructions of
Joint Circular No. 90/2016/ TTLT-BCT-BTC amending and supplementing a number of articles of Circular
Circular No. 125/2012/TT-BTC issued by the Ministry of Finance on 30 July 2012 guiding accounting regime
39. Whereby:
applicable to insurers, reinsurers, insurance brokers and foreign non-life insurance business branches (“Cir-
cular 125”). Reserve methods and assumptions used in calculation of technical reserves for each type of • Petroleum price stabilisation fund is appropriated with a specific amount, which is fixed within the
insurance products were approved by Ministry of Finance upon introduction of the products. basic price of the actually sold petroleum volume and is determined as an expense item in the basic
price structure (the rate of appropriation is stipulated by the Ministry of Finance from time to time) and
Technical reserves of PJICO include:
is recognised in cost of sales in the year corresponding to the long-term liability;
(i) Unearned premium reserve
• The utilisation of petroleum price stabilisation fund is made in accordance with written guidelines
Unearned premium reserves are made for the portion of unearned revenue at the end of the annual ac- issued by the Ministry of Finance from time to time. The utilisation depends on the actually sold petro-
counting period and accounted as a liability in the consolidated balance sheet. leum volume multiplied by the utilisation level per liter as regulated by the Ministry of Finance. Upon
utilisation for the price stabilisation purpose, the utilised amount is recognised as an increase in Cost
Unearned premium reserves are made on the basis of pro-rata method over the total written premium. This of sales during the year; and
reserve is provided for cargo insurance at 25% of the premium retained for the year and at 50% for other
types. • Gain or loss arising (upon obtaining additional borrowings for the utilised amount exceeding the pe-
troleum price stabilisation fund) on the petroleum price stabilisation fund account are recognised as an
(ii) Claims reserve increase or decrease, respectively in the petroleum price stabilisation fund account.
Claims reserve includes reserve for outstanding claims and for claims incurred but not reported.
(q) Share capital (i) Ordinary shares
Outstanding claims reserve are the amounts provided to cover the estimated ultimate cost of claims that
have occurred and reported prior to the reporting date, less amounts already paid in respect of those claims. Ordinary shares are stated at issue price less any costs directly attributable to the issue of shares. Incre-
Outstanding claims reserve is made separately for each claim dossier. mental costs directly attributable to the issue of shares, net of tax effects, are recognised as a deduction
from share premium.
“Incurred But Not Reported” claims (“IBNR”) are claims which have occurred during the current accounting
periods or previous annual accounting periods, but not yet been notified to the insurer or reinsurer at the (ii) Repurchase and reissue of ordinary shares (treasury shares)
end of the annual accounting period. This IBNR reserve is calculated based on 3% of the retained premium
The issued ordinary shares repurchased by the Group are classified as treasury shares under owners’ eq-
during the year under the PJICO’s responsibility in accordance with Official Letter No. 17755/BTC-QLBH
uity. The cost of treasury shares, which is recognised as a reduction from owners’ equity, includes purchase
dated 24 December 2012 of the Ministry of Finance (“Official Letter 17755”).
prices and any directly attributable costs.
(iii) Catastrophe reserve
When treasury shares are sold (reissue of treasury shares), the cost of the reissued shares is determined
PJICO has provided catastrophe reserve in accordance with Decree No. 46/2007/ND-CP dated 27 March on a weighted average basis. The difference between the treasury selling price and cost is recognised in
2007 of the Government (“Decree 46”), Circular 125 and Official Letter 17755. Catastrophe reserve was share premium
established at the rate of 2% of the retained premium. PJICO’s management established these ratios based
(r) Differences upon assets For the purpose of enterprises valuation upon equitisation, the Group has revaluated the value of invest-
on regional statistics in professional fields and believes that they are reasonable ratios for PJICO.
revaluation ments in subsidiaries and associates as per the Valuation Minutes of Vietnam Valuation and Finance Con-
(iv) Reinsurance assets sultancy Joint Stock Company and based on the Equitisation Finalization Documents approved by the
competent authorities, the Group has recognised an increase in the cost of these investments in the con-
PJICO does not offset the reserve for direct insurance and assumed reinsurance against the reserve for solidated balance sheet with an amount of VND1,317,118,937,352 (including an adjustment for revaluation
ceded reinsurance. These reserves are presented under the item of “Other current assets” in the consoli- of investments in subsidiaries of VND1,302,361,011,837 and an adjustment for revaluation of investments
dated balance sheet, in which, reserve for direct and assumed reinsurance premiums, reserve for direct and in associates of VND14,757,925,515), meanwhile the equity capital of those investees were not revaluated.
assumed reinsurance claims, and catastrophe reserve is recorded as Provisions – short-term; reserve for
ceded reinsurance premiums and reserve for ceded reinsurance claims are recorded as reinsurance assets For the purpose of consolidated financial statements preparation, the difference between value of the reval-
in Other current assets in the consolidated balance sheet. uated investments in subsidiaries and associates and value of equity in the investees was recognised as
a decrease in “Differences upon asset revaluation” in the consolidated financial statements of the Group.
(o) Provisions A provision, except for those specified in Note 3(n), is recognised if, as a result of a past event, the Group Income tax on the consolidated profit or loss for the year comprises current and deferred tax. Income tax is
has a present legal or constructive obligation that can be estimated reliably, and it is probable that an out- (s) Income tax recognised in the consolidated statement of income except to the extent that it relates to items recognised
flow of economic benefits will be required to settle the obligation. Provisions are determined by estimates directly to equity, in which case it is recognised in equity.
made by the Board of General Directors on necessary expenses to pay for this payable obligation at the
end of the annual accounting period. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted at the
end of the annual accounting period, and any adjustment to tax payable in respect of previous years.
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Deferred tax is provided using the balance sheet method, providing for temporary differences between the (iii) Rental income
carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation
purposes. The amount of deferred tax provided is based on the expected manner of realisation or settle- Rental income from leased property is recognised in the consolidated statement of income on a straight-line
ment of the carrying amounts of assets and liabilities using the tax rates enacted or substantively enacted basis over the term of the lease.
at the end of the annual accounting period.
(iv) Interest income
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be
Interest income is recognised on a time proportion basis with reference to the principal outstanding and the
available against which the temporary difference can be utilised. Deferred tax assets are reduced to the
applicable interest rate.
extent that it is no longer probable that the related tax benefit will be realised.
(v) Dividend income
The Group determines income tax obligations based on current tax regulations. However, these regulations
may change from time to time and the ultimate determination of income tax obligations is subject to review Dividend income is recognised when the right to receive dividend is established.
by competent tax authorities
(u) Operating lease Payments made under operating leases are recognised in the consolidated statement of income on a
payments straight-line basis over the term of the lease. Lease incentives received are recognised in the consolidated
(t) Revenue and other incomes (i) Goods sold
statement of income as an integral part of the total lease expense.
Revenue from the sale of goods is recognised in the consolidated statement of income when the significant
risks and rewards of ownership have been transferred to the buyer. No revenue is recognised if there are (v) Borrowing costs Borrowing costs are recognised as an expense in the year in which they are incurred, except where the
significant uncertainties regarding recovery of the consideration due or the possible return of goods. Reve- borrowing costs relate to borrowings in respect of the construction of qualifying assets, in which case the
nue on sales of goods is recognised at the net amount after deducting sales discounts stated on the invoice. borrowing costs incurred during the period of construction are capitalised as part of the cost of the assets
concerned.
(ii) Services rendered
Revenue from services rendered is recognised in the consolidated statement of income in proportion to (w) Earnings per share The Group presents basic and diluted earnings per share (EPS) for its ordinary shares. Basic EPS is cal-
the stage of completion of the transaction. The stage of completion is assessed by reference to surveys of culated by dividing the profit or loss attributable to the ordinary shareholders of the Parent Company by the
work performed. No revenue is recognised if there are significant uncertainties regarding recovery of the weighted average number of ordinary shares outstanding during the year. As at 31 December 2017 and for
consideration due. the year then ended, the Parent Company did not have any dilutive potential ordinary shares. Therefore,
requirement for disclosure of diluted earnings per share is not applicable.
(x) Segment reporting A segment is a distinguishable component of the Group that is engaged either in providing related products
or services (business segment), or in providing products or services within a particular economic environ-
ment (geographical segment), which is subject to risks and rewards that are different from those of other
segments. The Group’s primary format for segment reporting is based on business segments.
(y) Related parties Parties are considered to be related to the Group if one party has the ability, directly or indirectly, to con-
trol the other party or exercise significant influence over the other party in making financial and operating
decisions, or where the Group and the other party are subject to common control or significant influence.
Related parties may be individuals or corporate entities and include close family members of any individual
considered to be a related party.
132 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
4. SEGMENT REPORTING
Consolidated balance sheet as at 31 December 2017
PETROLEUM SEGMENT
PETROLEUM MEMBER NON-PETROLEUM MEM- PETROCHEMICAL GAS PRODUCTS INSURANCE SER- TRANSPORTATION OTHER GOODS INTERNAL ELIM- TOTAL
COMPANIES BER COMPANIES PRODUCTS VICES SERVICES AND SERVICES INATION AND
CONSOLIDATION
ADJUSTMENT
VND VND VND VND VND VND VND VND VND
ASSETS
Cash and cash equivalents 11,199,994,305,573 1,758,875,839,278 564,861,713,102 70,740,984,092 - 367,807,438,165 228,666,837,325 32,474,390,726 14,223,421,508,261
Short-term financial investments 1,244,927,368,000 - 43,851,350,000 953,610,000,000 - 237,259,552,100 25,359,439,402 - 2,505,007,709,502
Accounts receivable – short-term 3,310,960,891,353 8,970,758,973,682 1,566,184,002,298 324,914,017,091 - 511,804,042,932 446,090,649,537 (7,668,598,465,452) 7,462,114,111,441
Inventories 10,705,506,112,354 543,158,531,686 776,729,529,665 147,138,062,837 - 347,878,515,611 425,817,558,030 (78,677,101,049) 12,867,551,209,134
Other current assets 3,159,051,220,047 29,329,988,111 31,552,245,989 29,752,779,659 - 137,779,182,791 65,364,803,191 15,445,972,836 3,468,276,192,624
Accounts receivable – long-term 219,802,623,420 66,823,462,460 3,864,872,800 632,941,246 - 4,904,125,380 1,258,071,600 (208,601,559,578) 88,684,537,328
Fixed assets 7,281,755,962,057 635,375,379,687 508,837,657,656 440,741,618,121 - 4,533,182,719,259 2,018,685,866,932 (147,815,310,778) 15,270,763,892,934
Investment property 8,909,946,154 - 3,234,686,485 7,373,884,541 - 142,327,487,911 3,420,202,698 - 165,266,207,789
Long-term work in progress 273,839,963,197 62,181,771,260 152,870,182,358 6,328,932,989 - 191,179,792,494 93,722,682,487 - 780,123,324,785
Long-term financial investments 6,749,643,710,021 10,000,000,000 63,232,641,789 - - 195,268,719,742 56,729,727,001 (4,190,962,776,727) 2,883,912,021,826
Other long-term assets 1,355,285,677,841 103,883,700,320 165,519,008,588 326,953,255,864 - 40,840,509,885 61,458,224,437 - 2,053,940,376,935
Total assets 45,509,677,780,017 12,180,387,646,484 3,880,737,890,730 2,308,186,476,440 - 6,710,232,086,270 3,426,574,062,640 (12,246,734,850,022) 61,769,061,092,559
Liabilities
Current liabilities 26,302,718,635,831 10,853,311,898,825 2,462,289,679,528 1,366,706,698,187 - 1,197,017,569,752 1,201,787,352,127 (7,626,039,784,165) 35,757,792,050,085
Long-term liabilities 163,548,917,141 14,739,321,180 74,753,537,156 150,346,628,523 - 1,385,980,467,063 1,047,894,019,336 (209,979,012,877) 2,627,283,877,522
Total liabilities 26,466,267,552,972 10,868,051,220,005 2,537,043,216,684 1,517,053,326,710 - 2,582,998,036,815 2,249,681,371,463 (7,836,018,797,042) 38,385,075,927,607
Capital expenditure 1,432,947,330,550 134,705,494,675 180,090,380,607 66,611,955,976 18,715,891,503 678,968,125,508 58,308,218,324 (44,564,337,935) 2,525,783,059,208
Depreciation of tangible fixed assets 826,486,537,143 78,361,969,049 90,096,987,432 57,636,323,469 13,603,714,082 740,226,760,688 154,998,916,729 (28,023,835,957) 1,933,387,372,635
Amortization of intangible fixed assets 92,217,460,311 1,936,530,199 732,866,929 347,422,987 4,850,728,654 2,109,679,933 1,040,126,663 - 103,234,815,676
Depreciation of investment property 855,022,794 - - 182,593,332 1,051,882,218 6,406,286,756 360,601,608 - 8,856,386,708

134 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
4. SEGMENT REPORTING (TIẾP THEO)
PETROLEUM SEGMENT
CONSOLIDATION
ADJUSTMENT
Total net revenue 116.436.915.915.461 42.424.378.797.652 5.046.458.954.970 2.958.491.362.583 1.831.060.040.027 8.468.991.881.633 4.697.266.950.586 (28.166.507.037.094) 153.697.056.865.818
In which: Internal revenue 7.505.001.431.980 13.882.776.082.352 1.118.004.732.076 802.689.028.421 235.405.703.028 4.052.136.386.016 570.493.673.221 (28.166.507.037.094) -
Net revenue from external sales 108.931.914.483.481 28.541.602.715.300 3.928.454.222.894 2.155.802.334.162 1.595.654.336.999 4.416.855.495.617 4.126.773.277.365 - 153.697.056.865.818
Operating expenses (114.168.836.635.232) (41.904.799.335.879) (4.801.352.226.351) (2.788.599.558.528) (1.769.877.655.967) (8.042.638.880.199) (4.438.550.793.808) 28.375.392.257.860 (149.539.262.828.104)
Cost of goods sold and services rendered (106.797.683.927.984) (41.182.558.995.573) (4.263.628.331.642) (2.326.443.957.469) (1.264.607.809.611) (7.615.054.109.329) (4.129.136.084.101) 26.178.581.104.055 (141.400.532.111.654)
Selling expenses (7.371.152.707.248) (709.367.286.935) (446.045.201.873) (331.246.358.268) (303.779.627.854) (162.842.130.942) (193.114.405.683) 2.196.811.153.805 (7.320.736.564.998)
General and administration expenses - (12.873.053.371) (91.678.692.836) (130.909.242.791) (201.490.218.502) (264.742.639.928) (116.300.304.024) - (817.994.151.452)
Operating profit 2.268.079.280.229 519.579.461.773 245.106.728.619 169.891.804.055 61.182.384.060 426.353.001.434 258.716.156.778 208.885.220.766 4.157.794.037.714
Share of profit in associates and joint ventures 456.054.595.116
Financial income 791.143.396.401
Financial expenses (790.644.542.111)
Results of other activities 170.619.652.897
Accounting profit before tax 4.784.967.140.017
Income tax expense – current (894.833.667.465)
Income tax expense – deferred 21.529.227.908
Net profit after tax 3.911.662.700.460

136 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
PETROLEUM SEGMENT
CONSOLIDATION
ADJUSTMENT
ASSETS
Cash and cash equivalents 8,527,554,983,684 1,451,592,182,795 605,917,594,464 60,349,158,480 142,517,888,593 302,376,337,043 263,292,047,088 - 11,353,600,192,147
Short-term financial investments 927,894,400 - - 702,610,000,000 1,924,004,410,300 63,754,093,700 59,405,256,502 (97,087,692,407) 2,653,613,962,495
Accounts receivable – short-term 2,793,433,586,129 4,620,939,601,270 1,191,169,714,476 278,566,755,784 384,948,370,665 433,064,472,867 899,493,409,591 (3,683,256,365,470) 6,918,359,545,312
Inventories 6,334,116,525,991 351,299,291,325 733,380,600,929 124,195,026,915 9,807,911,023 380,641,169,356 787,633,130,226 (94,014,465,715) 8,627,059,190,050
Other current assets 2,359,893,187,409 49,059,521,834 25,800,707,401 23,342,632,128 1,192,671,081,256 64,215,334,517 85,691,994,249 22,830,390,767 3,823,504,849,561
Accounts receivable – long-term 204,722,389,906 15,107,941,760 3,825,000,000 799,631,178 11,533,394,107 5,044,845,955 1,532,595,730 (194,954,558,054) 47,611,240,582
Fixed assets 6,959,403,899,026 597,708,720,777 499,883,548,672 433,718,562,532 347,493,320,932 4,701,978,963,421 2,372,622,245,295 (266,735,407,650) 15,646,073,853,005
Investment property 9,764,968,948 - - 7,556,477,873 86,253,527,991 148,733,774,667 3,874,102,248 - 256,182,851,727
Long-term work in progress 163,154,290,108 36,491,463,148 80,639,517,992 5,742,178,561 12,650,598,705 195,412,191,679 110,612,188,958 - 604,702,429,151
Long-term financial investments 6,004,105,747,964 10,000,000,000 67,080,380,386 - 170,059,525,000 94,151,146,479 60,784,639,441 (4,025,188,728,796) 2,380,992,710,474
Other long-term assets 1,223,262,186,545 107,524,769,439 163,279,789,449 341,278,117,577 11,132,021,721 24,995,631,155 61,261,151,308 - 1,932,733,667,194
Total assets 34,580,339,660,110 7,239,723,492,348 3,370,976,853,769 1,978,158,541,028 4,293,072,050,293 6,414,367,960,839 4,706,202,760,636 (8,338,406,827,325) 54,244,434,491,698
Liabilities
Current liabilities 15,932,385,976,010 6,057,235,370,553 1,978,198,065,264 1,084,472,461,506 3,362,747,090,061 1,126,637,103,774 2,071,797,080,733 (3,671,493,077,382) 27,941,980,070,519
Long-term liabilities 174,403,073,371 51,263,701,111 41,424,088,867 161,261,086,724 16,063,182,294 1,533,260,706,716 1,320,077,657,256 (195,904,124,198) 3,101,849,372,141
Total liabilities 16,106,789,049,381 6,108,499,071,664 2,019,622,154,131 1,245,733,548,230 3,378,810,272,355 2,659,897,810,490 3,391,874,737,989 (3,867,397,201,580) 31,043,829,442,660
Capital expenditure 1,188,723,799,897 231,757,576,340 110,758,393,042 76,310,510,496 26,052,410,458 1,203,803,243,740 195,892,125,803 (54,408,413,324.00) 2,978,889,646,452
Depreciation of tangible fixed assets 799,703,780,669 63,289,523,037 99,696,462,068 55,427,850,353 25,621,552,184 654,260,681,855 202,111,881,979 (51,879,387,905) 1,848,232,344,240
Amortization of intangible fixed assets 96,581,849,525 1,523,309,619 609,874,417 986,838,371 10,235,657,617 2,132,486,332 1,019,760,090 - 113,089,775,971
Depreciation of investment property 744,638,123 - - 182,593,332 5,091,296,033 6,406,286,756 377,412,048 - 12,802,226,292

138 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
PETROLEUM SEGMENT
CONSOLIDATION
ADJUSTMENT
VND VND VND VND VND VND VND VND
Total net revenue 91,292,881,709,056 28,631,695,842,090 4,804,729,340,377 2,378,571,762,081 2,778,991,980,819 6,456,240,328,075 6,067,848,878,120 (19,314,442,824,298) 123,096,517,016,320
In which: Internal revenue 6,008,985,698,250 7,692,461,310,893 1,218,392,145,061 612,466,454,900 327,279,338,373 2,723,026,263,254 731,831,613,567 (19,314,442,824,298) -
Net revenue from external sales 85,283,896,010,806 20,939,234,531,197 3,586,337,195,316 1,766,105,307,181 2,451,712,642,446 3,733,214,064,821 5,336,017,264,553 - 123,096,517,016,320
Operating expenses (87,506,028,287,057) (28,114,592,217,048) (4,519,018,891,732) (2,248,479,803,275) (2,759,822,495,679) (6,016,762,685,125) (5,729,352,022,158) 19,284,746,399,214 (117,609,310,002,860)
Cost of goods sold and services rendered (80,632,077,065,761) (27,524,004,077,709) (4,002,777,581,722) (1,782,277,689,476) (1,925,092,395,946) (5,583,199,771,948) (5,316,410,306,874) 17,874,406,818,480 (108,891,432,070,956)
Selling expenses (6,873,951,221,296) (576,796,812,110) (409,255,277,405) (334,875,496,944) (518,191,172,272) (166,240,652,569) (235,183,263,329) 1,413,165,042,112 (7,701,328,853,813)
General and administration expenses - (13,791,327,229) (106,986,032,605) (131,326,616,855) (316,538,927,461) (267,322,260,608) (177,758,451,955) (2,825,461,378) (1,016,549,078,091)
Operating profit 3,786,853,421,999 517,103,625,042 285,710,448,645 130,091,958,806 19,169,485,140 439,477,642,950 338,496,855,962 (29,696,425,084) 5,487,207,013,460
Share of profit in associates and joint ventures 599,747,414,012
Financial income 879,878,586,647
Financial expenses (844,097,800,840)
Results of other activities 177,451,298,071
Accounting profit before tax 6,300,186,511,350
Income tax expense – current (1,152,206,706,935)
Income tax expense – deferred (546,182,104)
Net profit after tax 5,147,433,622,311

140 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
5. SIGNIFICANT TRANSACTIONS DURING THE YEAR

PJICO (*) CONSTRUCTION I CONSTRUCTION III TOTAL
VND VND VND VND
During 2017:
LIABILITIES
• PJICO completed the private placement of shares to a foreign investor. which consequently decreased the ownership ratio of the Group
from 51.19% to 40.95%. Accordingly. the Group presented the long-term investment in PJICO as an investment in associates as at 31 Current liabilities (3.350.214.614.935) (515.358.441.793) (223.590.544.901) (4.089.163.601.629)
December 2017. and

Long-term liabilities (15.105.684.417) (4.837.280.713) (13.347.002.770) (33.289.967.900)
• Voting rights of the Group in two companies in which the Group owns 30% of share capital. namely Petrolimex Construction Joint Stock
Net assets 862.901.464.855 170.477.562.911 85.071.049.006 1.118.450.076.772
Company I (“Construction I”) and Petrolimex Construction Joint Stock Company III (“Construction III”) was decreased to lower than 50%.
Accordingly. the Group presented long-term investments in these two companies as investments in associates as at 31 December 2017.
(*) The Group lost control in PJICO on 21 August 2017. Net assets of PJICO at the date of losing control were estimates
Net assets of these companies at the date that the Group lost control were as follows:
6. CASH AND CASH EQUIVALENTS
PJICO (*) CONSTRUCTION I CONSTRUCTION III TOTAL

VND VND VND VND 31.12.2017 1.1.2017
VND VND
ASSETS
Cash on hand 95,186,726,707 87,467,696,019
Cash and cash equiva-
133.798.476.482 33.831.610.894 13.913.359.261 181.543.446.637 Cash in banks 5,203,028,655,949 4,045,222,197,718
lents
Short-term financial In which:
1.904.536.441.450 - 59.045.817.100 1.963.582.258.550
investments
Accounts receivable – - Account balance of Price stabilisation fund (i) 3,215,870,855,058 1,529,199,064,366
444.752.768.025 274.012.346.101 136.187.364.186 854.952.478.312
short-term
Cash in transit (ii) 407,689,530,579 209,393,994,980
Inventories 9.713.279.182 140.850.665.681 72.817.231.695 223.381.176.558
Cash equivalents (iii) 8,517,516,595,026 7,011,516,303,430
Other current assets 1.098.226.420.081 11.253.873.540 1.369.434.180 1.110.849.727.801
14,223,421,508,261 11,353,600,192,147
Accounts receivable –
11.702.885.439 - 10.000.000 11.712.885.439
long-term
(i) The account balance of Price stabilisation fund is monitored separately in a bank account.
Tangible fixed assets 231.243.818.219 173.835.777.276 34.356.133.938 439.435.729.433
The account balance of Price stabilisation fund should be used solely for the price stabilisation purpose and should not be used for any other
Cost 381.413.917.617 406.575.317.949 74.618.335.725 862.607.571.291 purpose.
Accumulated depreciation (150.170.099.398) (232.739.540.673) (40.262.201.787) (423.171.841.858) (ii) Cash in transit includes the cash balances at petroleum stations of the petroleum member companies. These amounts will be transferred
to the petroleum member companies’ bank accounts on the next working day.
Intangible fixed assets 107.453.833.406 23.433.347.720 7.544.448 130.894.725.574
(iii) Cash equivalents represent term deposits at domestic banks with a tenor of less than three months.
Cost 133.880.587.411 23.529.347.720 612.376.049 158.022.311.180
Accumulated amortization (26.426.754.005) (96.000.000) (604.831.601) (27.127.585.606)
Investment property 85.201.645.773 - 93.297.942 85.294.943.715
Cost 96.057.873.261 - 252.156.600 96.310.029.861
Accumulated depreciation (10.856.227.488) - (158.858.658) (11.015.086.146)
Construction in progress 21.003.573.479 27.187.101.380 1.604.980.326 49.795.655.185
Long-term financial
167.059.525.000 4.579.000.000 650.000.000 172.288.525.000
investments
Long-term prepaid
8.071.341.642 1.689.562.825 1.953.433.601 11.714.338.068
expenses
Other long-term assets 5.457.756.029 - - 5.457.756.029
4.228.221.764.207 690.673.285.417 322.008.596.677 5.240.903.646.301

142
7. FINANCIAL INVESTMENTS
(a) Trading securities

PETROLIMEX
31/12/2017 1/1/2017
ANNUAL REPORT 2017
SỐ GIÁ GỐC DỰ PHÒNG GIÁ TRỊ SỐ GIÁ GỐC DỰ PHÒNG GIÁ TRỊ
LƯỢNG GIẢM GIÁ HỢP LÝ LƯỢNG GIẢM GIÁ HỢP LÝ
VND VND VND VND VND VND
Military Commercial Joint Stock Bank - - - - 715,908 15,000,000,000 (4,977,288,000) 10,022,712,000
Saigon Beer-Alcohol-Beverage Joint Stock

- - - - 200,000 14,000,000,000 - 39,540,000,000
Corporation
Hai Phong Port One Member Limited Company - - - - 538,000 7,263,000,000 - 9,146,000,000
06. CONSOLIDATED
PetroVietnam Fertilizer and Chemicals Corpo-

- - - - 300,000 10,809,632,500 (4,104,632,500) 6,705,000,000
ration
Refrigeration Electrical Engineering Corporation - - - - - 5,737,050,000 (1,564,100,800) 4,172,949,200
Hanoi Textile And Garment Joint Stock Corpo-

100,000 2,610,000,000 - (*) 100,000 2,610,000,000 - (*)
ration
Others 3,411,246,000 (2,053,067,986) (*) 23,695,955,900 (9,549,051,093) (*)
6,021,246,000 (2,053,067,986) (*) 79,115,638,400 (20,195,072,393) (*)
(*) The Group has not determined fair values of these investments for disclosure in the consolidated financial statements because information about their market prices is not available and
there is currently no guidance on determination of fair value using valuation techniques under the Vietnamese Accounting Standards or the Vietnamese Accounting System for enterprises.
There fair values of these financial investments may differ from their carrying amounts.
Others
Term deposits
Term deposits
Corporate bonds
(b) Held-to-maturity investments
may differ from their carrying amounts.

Held-to-maturity investments – long - term
Held-to-maturity investments – short - term
-
-
VND
1,500,000,000
1,500,000,000
COST
2,501,039,531,488
31/12/2017
VND
FAIR VALUE
06. CONSOLIDATED
1,500,000,000
-
-
1,500,000,000
2,527,386,712,043
VND
COST
112,400,000,000
20,400,000,000
85,000,000,000
7,000,000,000
2,594,693,396,488
1/1/2017
ANNUAL REPORT 2017
PETROLIMEX
VND
FAIR VALUE
(*)
(*)
(*)
7,000,000,000
2,686,530,235,122
143
about their market prices is not available and there is currently no guidance on determination of fair value using valuation techniques under
the Vietnamese Accounting Standards or the Vietnamese Accounting System for enterprises. There fair values of these financial investments
(*) The Group has not determined fair values of these investments for disclosure in the consolidated financial statements because information
144 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
7. FINANCIAL INVESTMENTS (CONTINUED)
(c) Investments in subsidiaries
31/12/2017 1/1/2017 31/12/2017 1/1/2017
NO. NAME ADDRESS PRINCIPAL ACTIVITIES % OF % OF % OF % OF NO. NAME ADDRESS PRINCIPAL ACTIVITIES % OF % OF % OF % OF
VOTING EQUITY VOTING EQUITY VOTING EQUITY VOTING EQUITY
RIGHTS OWNED RIGHTS OWNED RIGHTS OWNED RIGHTS OWNED
1 Petrolimex Tanker Corporation Hanoi Transportation services 100% 100% 100% 100% Petrolimex Ha Tay Transportation and
26 Hanoi Trading and transporting goods 51.00% 51.00% 51.00% 51.00%
Service JSC (i)
Vanphong Bonded Petroleum Terminal Joint Storing and trading petroleum
2 Khanh Hoa 85.00% 85.00% 90.00% 87.56% Petrolimex Da Nang Transportation and
Venture Company Limited products at border gate 27 Da Nang Trading and transporting goods 51.00% 51.00% 51.00% 51.00%
Service JSC (i)
3 Petrolimex Petrochemical Corporation - JSC Hanoi Processing petroleum products 79.07% 79.07% 79.07% 79.07% Petrolimex Thua Thien Hue Transportation
28 Hue Trading and transporting goods 51.00% 51.00% 51.00% 51.00%
and Service JSC (i)
4 Petrolimex Gas Corporation – JSC Hanoi Trading gas products 52.37% 52.37% 52.37% 52.37%
Petroleum member companies
Petrolimex Transportation Services Corpo-
5 Hanoi Transportation services 100% 100% 100% 100%
ration (i) Petrolimex Quang Ninh One Member Limited
29 Quang Ninh Trading petroleum 100% 100% 100% 100%
Company
6 Petrolimex Singapore Pte. Ltd. (“PLS”) Singapore Trading petroleum 100% 100% 100% 100%
Petrolimex Sai Gon One Member Limited
Petroleum Logistic Service and Investment 30 Ho Chi Minh City Trading petroleum 100% 100% 100% 100%
7 Hanoi Real-estate trading 51.00% 51.00% 58.75% 54.31% Company
JSC
Petrolimex Hanoi One Member Limited
31 Hanoi Trading petroleum 100% 100% 100% 100%
8 Petrolimex Aviation Fuel JSC Hanoi Providing fuel for airlines 59.00% 59.00% 59.00% 59.00% Company
Petrolimex Da Nang One Member Limited
Petrolimex International Trading Joint Stock 32 Da Nang Trading petroleum 100% 100% 100% 100%
9 Ho Chi Minh City Import-export services 52.67% 52.67% 52.67% 52.67% Company
Company
33 Petrolimex Tay Nam Bo Limited Company Can Tho Trading petroleum 100% 100% 100% 100%
10 Petrolimex (Lao) Ltd. Laos Trading petroleum 100% 100% 100% 100%
Petrolimex Ba Ria Vung Tau Limited Com-
Providing equipment for petro- 34 Ba Ria Vung Tau Trading petroleum 100% 100% 100% 100%
11 Petroleum Mechanical Joint Stock (ii) Ho Chi Minh City 46.00% 46.00% 46.00% 46.00% pany
leum sector
Producing petroleum-based 35 Petrolimex Nghe An Limited Company Nghe An Trading petroleum 100% 100% 100% 100%
12 PTN Chemicals Company Limited Hai Phong 60.00% 60.00% 60.00% 60.00%
surface materials
36 Petrolimex Nam Dinh Limited Company Nam Dinh Trading petroleum 100% 100% 100% 100%
Providing equipment for petro-
13 Petrolimex Equipment Joint Stock Company Hanoi 50.48% 50.48% 50.48% 50.48%
leum sector 37 Petrolimex Phu Khanh Limited Company Khanh Hoa Trading petroleum 100% 100% 100% 100%
Petrolimex Information Technology and
14 Hanoi Developing software products 50.33% 50.33% 50.33% 50.33% 38 Petrolimex Ha Son Binh Limited Company Hanoi Trading petroleum 100% 100% 100% 100%
Telecommunication JSC
15 Petrolimex Engineering JSC Hanoi Construction consultancy 51.00% 51.00% 51.00% 51.00% Petrolimex Hai Phong One Member Limited
39 Hai Phong Trading petroleum 100% 100% 100% 100%
Company
16 Petrolimex Kien Giang Co., Ltd. Kien Giang Trading petroleum 51.00% 51.00% 51.00% 51.00% Petrolimex Vinh Long One Member Limited
40 Vinh Long Trading petroleum 100% 100% 100% 100%
Company
17 VP Petrochemical Transport J.S.C Hai Phong Transportation services 88.88% 57.62% 88.88% 57.62%
41 Petrolimex Gia Lai Limited Company Gia Lai Trading petroleum 100% 100% 100% 100%
Hai Chau Trading and Services Company Producing, trading ice, frozen
18 Ho Chi Minh City 92.04% 92.04% 92.04% 92.04%
Limited seafood 42 Petrolimex Binh Dinh Limited Company Binh Dinh Trading petroleum 100% 100% 100% 100%
Producing, trading ice, frozen
19 Cai Be Trading and Services JSC Tien Giang 63.04% 63.04% 63.04% 63.04% Petrolimex Thanh Hoa One Member Limited
seafood 43 Thanh Hoa Trading petroleum 100% 100% 100% 100%
Company
Petrolimex Joint Stock Insurance Company
20 Hanoi Insurance services 40.95% 51.19% 51.19% 51.19% Petrolimex Daklak One Member Limited
(“PJICO”) (iii) 44 Daklak Trading petroleum 100% 100% 100% 100%
Company
Petrolimex Construction Joint Stock Com-
21 Hanoi Construction 31.34% 31.34% 51.00% 31.34% 45 Petrolimex Long An Limited Company Long An Trading petroleum 100% 100% 100% 100%
pany I (iii)
Petrolimex Construction Joint Stock Compa- Petrolimex Ca Mau One Member Limited
22 Ho Chi Minh City Construction 30.00% 30.00% 51.00% 30.00% 46 Ca Mau Trading petroleum 100% 100% 100% 100%
ny III (iii) Company
Petrolimex Saigon Transportation and Petrolimex Tien Giang One Member Limited
23 Ho Chi Minh City Trading and transporting goods 52.73% 52.73% 52.73% 52.73% 47 Tien Giang Trading petroleum 100% 100% 100% 100%
Service JSC (i) Company
Petrolimex Hanoi Transportation and Trading 48 Petrolimex Dong Nai Limited Company Dong Nai Trading petroleum 100% 100% 100% 100%
24 Hanoi Trading and transporting goods 51.00% 51.00% 51.00% 51.00%
JSC (i)
Petrolimex Nghe Tinh Transportation and 49 Petrolimex Bac Thai Limited Company Thai Nguyen Trading petroleum 100% 100% 100% 100%
25 Nghe An Trading and transporting goods 51.00% 51.00% 51.00% 51.00%
Service JSC (i)
146 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX

(c) Investments in subsidiaries
(i) Petrolimex Transportation Services Corporation is a subsidiary newly established in 2017 in accordance with Decision No. 515/PLX-QD-
31/12/2017 1/1/2017 HDQT dated 20 September 2017 of the Board of Management of Vietnam National Petroleum Group (“Decision 515”). Also under Decision
515, Vietnam National Petroleum Group transfers the rights and obligations of owner’s representative for its equity at joint stock companies
NO. NAME ADDRESS PRINCIPAL ACTIVITIES % OF % OF % OF % OF
VOTING EQUITY VOTING EQUITY including Petrolimex Hanoi Transportation and Trading JSC, Petrolimex Nghe Tinh Transportation and Service JSC, Petrolimex Ha Tay Trans-
RIGHTS OWNED RIGHTS OWNED
portation and Service JSC, Petrolimex Da Nang Transportation and Service JSC, and Petrolimex Thua Thien Hue Transportation and Service
50 Petrolimex Hue Limited Company Hue Trading petroleum 100% 100% 100% 100% JSC to Petrolimex Transportation Services Corporation.
51 Petrolimex Tay Ninh Limited Company Tay Ninh Trading petroleum 100% 100% 100% 100% (ii) These are the joint stock companies that the Group holds less than 50% of charter capital but holds the controlling power as it has the
majority of members in their Board of Management, and thus are considered as subsidiaries of the Group.
52 Petrolimex Lao Cai Limited Company Lao Cai Trading petroleum 100% 100% 100% 100%
(iii) During 2017:
53 Petrolimex Phu Tho Limited Company Phu Tho Trading petroleum 100% 100% 100% 100%
Petrolimex Song Be One Member Limited • PJICO completed the private placement of shares to a foreign investor, which consequently decreased the ownership ratio of the Par-
54 Binh Duong Trading petroleum 100% 100% 100% 100% ent Company to 40.95%. Accordingly, the Group presented the long-term investment in PJICO as an investment in associates as at 31
Company
December 2017.
55 Petrolimex Lam Dong Limited Company Lam Dong Trading petroleum 100% 100% 100% 100%
• Voting rights of the Group in two companies in which the Group owns 30% of share capital, namely Petrolimex Construction Joint Stock
56 Petrolimex Ha Tinh Limited Company Ha Tinh Trading petroleum 100% 100% 100% 100%
Company I and Petrolimex Construction Joint Stock Company III was decreased to lower than 50%. Accordingly, the Group presented
57 Petrolimex Ben Tre Limited Company Ben Tre Trading petroleum 100% 100% 100% 100% long-term investments in these two companies as investments in associates as at 31 December 2017.
58 Petrolimex Ha Bac Limited Company Bac Giang Trading petroleum 100% 100% 100% 100%
Petrolimex An Giang One Member Limited

59 An Giang Trading petroleum 100% 100% 100% 100%
Company
60 Petrolimex Quang Tri Limited Company Quang Tri Trading petroleum 100% 100% 100% 100%
61 Petrolimex Quang Binh Limited Company Quang Binh Trading petroleum 100% 100% 100% 100%
62 Petrolimex Dong Thap Limited Company Dong Thap Trading petroleum 100% 100% 100% 100%
63 Petrolimex Dien Bien Limited Company Dien Bien Trading petroleum 100% 100% 100% 100%
Petrolimex Tra Vinh One Member Limited

64 Tra Vinh Trading petroleum 100% 100% 100% 100%
Company
65 Petrolimex Ha Giang Limited Company Ha Giang Trading petroleum 100% 100% 100% 100%
66 Petrolimex Yen Bai Limited Company Yen Bai Trading petroleum 100% 100% 100% 100%
67 Petrolimex Cao Bang Limited Company Cao Bang Trading petroleum 100% 100% 100% 100%
68 Petrolimex Tuyen Quang Limited Company Tuyen Quang Trading petroleum 100% 100% 100% 100%
Petrolimex Quang Ngai One Member Limited

69 Quang Ngai Trading petroleum 100% 100% 100% 100%
Company
70 Petrolimex Thai Binh Limited Company Thai Binh Trading petroleum 100% 100% 100% 100%
71 Petrolimex Lai Chau Limited Company Lai Chau Trading petroleum 100% 100% 100% 100%
148 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
(d) Equity investments in associates, joint-ventures
31/12/2017 1/1/2017
NO. NAME ADDRESS PRINCIPAL ACTIVITIES % OF % OF EQUITY ACCOUNTED ALLOWANCE FOR FAIR VALUE % OF VOTING % OF EQUITY EQUITY ACCOUNTED ALLOWANCE FOR FAIR VALUE
VOTING EQUITY INVESTMENT VALUE DIMINUTION IN (VND) RIGHTS OWNED INVESTMENT VALUE DIMINUTION IN (VND)
RIGHTS OWNED (VND) VALUE (VND) (VND) VALUE (VND)
Joint ventures
1 Castrol BP Petco Co. Ltd. Ho Chi Minh City Processing lubricant products 35.00% 35.00% 274,448,634,715 - (*) 35.00% 35.00% 413,355,234,965 - (*)
Associates
Petrolimex Group Commercial Joint

1 Hanoi Banking 40.00% 40.00% 1,423,938,546,859 - (*) 41.85% 40.57% 1,457,775,675,488 - (*)
Stock Bank (i)
Cho Gao Trade and Services Joint
2 Tien Giang Trading petroleum 0.00% 0.00% - - (*) 29.20% 29.20% 4,220,400,000 - (*)
Stock Company (ii)
Thang Long Machinery Construction Construction and equipment
3 Ho Chi Minh City 0.00% 0.00% - - (*) 44.44% 13.33% 400,000,000 (400,000,000) (*)
Trading Company Limited (ii) provision
Vietnam Automobiles Repairing
4 Hanoi Automobile repairing services 40.00% 40.00% 1,800,000,000 (261,917,003) 1,538,082,997 35.55% 35.55% 3,150,000,000 (261,917,003) (*)
Trading and Services JSC (ii)
Tuyen Quang Trading Joint Stock
5 Tuyen Quang Commercial trading 27.73% 27.73% 1,892,671,550 - (*) 27.73% 27.73% 1,832,887,337 - (*)
Company
6 Mekong Riverside Resort (ii) Tien Giang Trading goods 40.00% 40.00% 11,220,000,000 (539,237,357) 10,680,762,643 40.00% 21.60% 12,900,000,000 (825,186,172) (*)
Nghe An Real Estate Joint Stock

7 Nghe An Real Estate Trading 47.50% 47.50% 4,212,934,279 - (*) 47.50% 25.65% 4,199,635,261 - (*)
Company
Tribeca Avenue Real Estate Compa-
8 Khanh Hoa Real Estate Trading 26.00% 26.00% 5,200,000,000 - (*) 26.00% 26.00% 5,200,000,000 - (*)
ny Limited (ii)
Nha Petrolimex - Tradoco Develop-
9 Vung Tau Real Estate Trading 37.00% 37.00% 92,436,154,529 - (*) 37.00% 37.00% 92,436,154,529 - (*)
ment Joint Stock Company (ii)
Investment, construction, operation,
10 Vietnam Expressway Services JSC Hanoi management and maintenance of 22.38% 22.38% 21,646,629,028 - (*) 22.38% 22.38% 21,554,814,768 - (*)
national expressway network.
Dong Nai Petroleum Material and
11 Dong Nai Trading petroleum 21.32% 21.32% 8,014,100,107 - (*) 21.32% 21.32% 11,048,650,429 - (*)
Fuel Joint Stock Company
Kien Giang Trade and Tourism Com- Trading agricultural products,
12 Kien Giang 38.94% 38.94% 144,544,689,844 - (*) - - - - (*)
pany Limited (ii) petroleum
Petrolimex Insurance Corporation
13 Hanoi Insurance services 40.95% 40.95% 601,084,773,323 - 965,969,137,532
(i) (**)
Petrolimex Construction Joint Stock
14 Hanoi Construction 30.00% 30.00% 63,897,019,142 - (*)
Company I (**)
Petrolimex Construction Joint Stock
15 Ho Chi Minh City Construction 30.00% 30.00% 23,651,673,251 - (*)
Company III (**)
2,677,987,826,627 (801,154,360) (*) 2,028,073,452,777 (1,487,103,175) (*)
(i) As described in Note 3(a)(iv), the Group had a plan for divestment from Petrolimex Group Commercial Joint Stock Bank and Petrolimex (*) The Group has not determined fair values of these investments for disclosure in the consolidated financial statements because information
Insurance Corporation. about their market prices is not available and there is currently no guidance on determination of fair value using valuation techniques under
Vietnamese Accounting Standards or the Vietnamese Accounting System for enterprises. The fair values of these investments may differ
(ii) Investments in associates were stated at cost in the consolidated financial statements of the Group. According to assessment of the Board from their carrying amounts.
of General Directors, failure to apply the equity method in recognition for these associates has not caused material effect on the consolidated
financial statements of the Group as the investment value was insignificant. (**) As at 1 January 2017, these companies were still subsidiaries of the Group. During the year, the Group lost control in these companies
as described in Note 5. Accordingly, the Group presented the long-term investments in these companies as investments in associates as at
31 December 2017.
150 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
7. FINANCIAL INVESTMENTS (CONTINUED) 10. INVENTORIES
(e) Equity investments in other entities

31/12/2017 1/1/2017
31/12/2017 1/1/2017 COST ALLOWANCE COST ALLOWANCE

VND VND VND VND
NO. NAME ADDRESS PRINCI- COST ALLOWANCE FAIR COST ALLOWANCE FAIR
PAL AC- (VND) FOR DIMINU- VALUE (VND) FOR DIMINU- VALUE Goods in transit 4,237,792,771,786 - 1,311,740,602,184 -
TIVITIES TION IN VALUE (VND) TION IN VALUE (VND)
(VND) (VND)
Raw materials 838,904,657,193 (13,806,129,002) 957,327,762,219 (13,128,954,741)
Military Petrochemical
Trading
1 Joint Stock Company - Hanoi 50,000,000,000 - (*) 50,000,000,000 - (*)
petroleum Tools and supplies 35,551,079,298 - 36,398,388,697 -
MIPEC
Vietnam Export Import Work in progress 139,163,140,390 (921,353,588) 331,265,088,339 -
Ho Chi
2 Commercial Joint Stock Banking 49,913,937,200 - 31,258,729,471 49,913,937,200 - 22,239,412,272
Minh City
Bank (Eximbank)
Finished goods 243,338,727,923 - 316,909,885,149 (1,420,997,131)
Trading
3 An Phu Corporation Hanoi 110,724,000,000 (104,914,500,000) (*) 110,724,000,000 (105,560,000,000) (*)
petroleum
Merchandise inventories 7,390,431,949,506 (8,482,080,364) 5,683,223,300,081 (2,167,214,862)
4 Others 104,558,520,065 (5,056,607,706) (*) 145,036,338,416 (8,107,914,744) (*)
Goods on consignment 5,578,445,992 - 6,911,330,115 -
315,196,457,265 (109,971,107,706) (*) 355,674,275,616 (113,667,914,744) (*)
12,890,760,772,088 (23,209,562,954) 8,643,776,356,784 (16,717,166,734)
(*) The Group has not determined fair values of these investments for disclosure in the consolidated financial statements because information
about their market prices is not available and there is currently no guidance on determination of fair value using valuation techniques under Included in inventories at 31 December 2017 was VND729,848 million of goods (1/1/2017: Nil) stated at net realisable value..
Vietnamese Accounting Standards or the Vietnamese Accounting System for enterprises. The fair values of these financial investments may
11. TANGIBLE FIXED ASSETS
differ from their carrying amounts.
8. ACCOUNTS RECEIVABLE FROM CUSTOMERS BUILDINGS, MACHINERY MOTOR OFFICE OTHERS TOTAL
STRUCTURES AND EQUIPMENT VEHICLES EQUIPMENT
(VND) (VND) (VND) (VND) (VND) (VND)
Accounts receivable from customers detailed by significant customers
Cost
31/12/2017 1/1/2017
Opening balance 11,566,590,478,733 3,662,625,865,404 12,488,402,774,566 480,057,997,243 26,494,441,704 28,224,171,557,650
VND VND
Additions 516,357,818,765 158,895,458,185 592,473,481,120 63,420,080,817 1,431,005,685 1,332,577,844,572

Xuyen Viet Oil Travel and Transport Trading Company Limited 2,551,913,715,308 121,186,750,958
Transfer from con-
Savimex Economic Cooperation and Import-Export Joint Stock Company 474,951,971,966 319,301,053,021 536,264,423,317 120,881,306,987 85,455,154,552 29,498,509,015 1,546,148,668 773,645,542,539
struction in progress
Vietjet Aviation Joint Stock Company 414,704,154,829 268,517,807,916 Reclassified - (2,050,164,796) 81,390,183,917 (79,340,019,121) - -
Disposal and writ-

Hai Ha Waterway Transport Company Limited 38,444,171,803 460,250,351,891 (67,718,885,634) (26,419,498,286) (57,460,457,316) (8,329,363,780) (125,588,320) (160,053,793,336)
ten off
Decrease due to
Military Petroleum Corporation - 138,058,718,737
loss of control in (399,726,295,229) (191,934,980,113) (229,950,658,720) (36,500,945,415) (4,494,691,814) (862,607,571,291)
subsidiaries (Note 5)
Other customers 3,331,888,230,887 4,877,154,113,137
Other movements (1,390,005,101) (137,539,540) 429,773,619 2,229,001,747 (10,207,805) 1,121,022,920
6,811,902,244,793 6,184,468,795,660
Closing balance 12,150,377,534,851 3,721,860,447,841 12,960,740,251,738 451,035,260,506 24,841,108,118 29,308,854,603,054
9. OTHER RECEIVABLES - SHORT-TERM Accumulated depreciation
31/12/2017 1/1/2017 Opening balance 5,317,164,904,373 2,290,607,557,851 6,531,693,801,009 318,357,603,146 14,971,919,075 14,472,795,785,454
VND VND
Charge for the year 773,445,840,574 315,257,909,832 924,921,460,081 64,977,114,309 2,444,306,399 2,081,046,631,195
Import-related tax overpaid (i) 284,429,916,127 132,354,983,230
Disposal and writ-
(52,678,571,846) (25,698,565,546) (52,537,272,411) (8,119,021,346) (125,588,320) (139,159,019,469)
ten off
Others 306,087,915,272 571,049,323,853
Decrease due to
loss of control in (110,425,865,710) (126,508,770,225) (156,383,961,069) (27,086,044,076) (2,767,200,778) (423,171,841,858)
590,517,831,399 703,404,307,083 subsidiaries (Note 5)
Other movements (9,042,650,611) (227,734,447) 805,759,666 107,697,400 (14,894,078) (8,371,822,070)

(i) The amount due from local customs department relates to overpayments of value added tax on imported goods arising from the difference
between the normal import tax incentive and the special import tax incentive under regional trade agreements for some imported petroleum Closing balance 5,918,463,656,780 2,453,430,397,465 7,248,499,787,276 348,237,349,433 14,508,542,298 15,983,139,733,252
products. The Group paid value added tax for imported goods at the normal incentive rate. After customs clearance, these imported goods
were determined to be entitled to the special incentive tax rate; accordingly, the Group will be refunded the value added tax it has overpaid.
152 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
11. TANGIBLE FIXED ASSETS (CONTINUED)
Included in intangible fixed assets were assets costing VND141,260 million which were fully amortised as of 31 December 2017 (1/1/2017:
BUILDINGS, MACHINERY MOTOR OFFICE OTHERS TOTAL
STRUCTURES AND EQUIPMENT VEHICLES EQUIPMENT
VND60,894 million), but which are still in active use.
(VND) (VND) (VND) (VND) (VND) (VND)
At 31 December 2017, intangible fixed assets of the Group’s subsidiaries with a net book value of VND45,922 million (1/1/2017: VND9,705
Net book value
million) were pledged with banks as security for loans granted (Note 19(b))..
Opening balance 6,249,425,574,360 1,372,018,307,553 5,956,708,973,557 161,700,394,097 11,522,522,629 13,751,375,772,196
13. INVESTMENT PROPERTY
Closing balance 6,231,913,878,071 1,268,430,050,376 5,712,240,464,462 102,797,911,073 10,332,565,820 13,325,714,869,802
LAND USE RIGHTS BUILDINGS TOTAL
Included in tangible fixed assets were assets costing VND4,083,093 million which were fully depreciated as of 31 December 2017 but which (VND) (VND) (VND)
are still in active use (1/1/2017: VND3,404,505 million).
Cost
At 31 December 2017, tangible fixed assets of the Group’s subsidiaries with a net book value of VND4,835,981 million (1/1/2017: VND5,446,600
Opening balance 218,309,907,157 96,057,873,261 314,367,780,418
million) were pledged with banks as security for loans granted (Note 19(b)).
Transfer from construction in progress 3,234,686,485 - 3,234,686,485
12. INTANGIBLE FIXED ASSETS
Reclassifications (164,754,191,497) 164,754,191,497 -
LAND USE RIGHTS SOFTWARE LICENSE SOFTWARE OTHERS TOTAL

Decrease due to loss of control in subsidiaries (Note 5) - (96,310,029,861) (96,310,029,861)
(VND) (VND) (VND) (VND) (VND)
Closing balance 56,790,402,145 164,502,034,897 221,292,437,042

Cost
Accumulated depreciation
Opening balance 1,872,522,770,432 13,659,067,200 459,417,963,172 27,349,430,780 2,372,949,231,584
Opening balance 48,380,583,421 9,804,345,270 58,184,928,691

Additions 180,392,407,953 683,836,000 37,581,443,616 1,810,216,535 220,467,904,104
Transfer from construction in Charge for the period 139,140,000 8,717,246,708 8,856,386,708
48,358,117,064 - 12,008,676,271 - 60,366,793,335
progress
Transfer to long - term prepaid Reclassifications (18,470,538,695) 18,470,538,695 -
16,763,157,384 - - - 16,763,157,384
expensive
Decrease due to loss of control in subsidiaries (Note 5) - (11,015,086,146) (11,015,086,146)
Disposal and written off (10,920,670,163) - (3,950,806,956) (168,000,000) (15,039,477,119)
Closing balance 30,049,184,726 25,977,044,527 56,026,229,253
Decrease due to loss of control
(126,600,353,404) (440,000,000) (30,678,952,776) (303,005,000) (158,022,311,180)
in subsidiaries (Note 5)
Net book value
Other movements (10,353,096,286) (1,584,471,000) 3,141,398,549 (688,540,049) (9,484,708,786)
Opening balance 169,929,323,736 86,253,527,991 256,182,851,727
Closing balance 1,970,162,332,980 12,318,432,200 477,519,721,876 28,000,102,266 2,488,000,589,322
Closing balance 26,741,217,419 138,524,990,370 165,266,207,789
Accumulated amortization
The fair value of the investment property held for earn rental of the Group has not been determined as there was no market transaction for
Opening balance 142,005,043,901 7,117,172,635 311,516,081,913 17,612,852,326 478,251,150,775
similar property in the same location as the Group’s investment property and there is no active market for such property.
Charge for the year 19,348,496,210 842,387,453 81,756,346,633 1,287,585,380 103,234,815,676
14. CHI PHÍ XÂY DỰNG CƠ BẢN DỞ DANG
Transfer to long - term prepaid
1,001,092,666 - - - 1,001,092,666
expensive
2017 2016
Disposal and written off (27,526,557) - (3,933,467,155) (168,000,000) (4,128,993,712)
(VND) (VND)
Decrease due to loss of control
(2,082,634,929) (440,000,000) (24,503,124,901) (101,825,776) (27,127,585,606) Opening balance 604,702,429,151 700,390,839,066
in subsidiaries (Note 5)
Other movements (8,289,769,226) (882,281,274) 1,344,351,675 (451,214,784) (8,278,913,609) Additions during the year 1,261,665,429,760 1,492,585,202,951
Closing balance 151,954,702,065 6,637,278,814 366,180,188,165 18,179,397,146 542,951,566,190 Transfer to tangible fixed assets (773,645,542,539) (1,331,372,886,334)
Net book value Transfer to intangible fixed assets (60,366,793,335) (40,908,460,300)
Opening balance 1,730,517,726,531 6,541,894,565 147,901,881,259 9,736,578,454 1,894,698,080,809 Transfer to investment properties (3,234,686,485) -
Closing balance 1,818,207,630,915 5,681,153,386 111,339,533,711 9,820,705,120 1,945,049,023,132 Transfer to short-term prepaid expenses (8,204,227,849) (3,397,949,842)
Others
Written off
154
Other movements
Dinh Vu Warehouse Project
Kien Luong Port Warehouse

PETROLIMEX
An Bien Oil and Gas Warehouse

Provision for major repairs utilised
TDK – Petrolimex Building Project

37 Phan Boi Chau Building Project
Transfer to long-term prepaid expenses
ANNUAL REPORT 2017
Decrease due to loss of control in subsidiaries (Note 5)
Ngoc Khanh Service and Trading Center Building Project

Major items/projects of construction in progress were as follows:
06. CONSOLIDATED
777,729,469,586
495,126,870,248
16,517,025,455
17,303,149,832
24,560,193,202
777,729,469,586
(49,795,655,185)
(83,488,000,624)
37,080,980,522
50,259,691,598
136,881,558,729
(20,130,745,714)
(93,784,881,357)
(VND)
31/12/2017
(VND)
2017
604,702,429,151
385,954,895,883
-
16,805,913,275
24,523,848,929
604,702,429,151
37,080,980,522
5,430,757,807
134,906,032,735
(VND)
1/1/2017
-
-
(57,823,859,224)
(150,540,574,091)
(VND)
2016
15. LONG-TERM PREPAID EXPENSES
GAS CYLINDERS BUSINESS ADVAN- LAND RENTALS OVERHAUL COSTS TOOLS AND IN- OTHERS TOTAL
TAGE RELATED TO STRUMENTS
EQUITISATION
(VND) (VND) (VND) (VND) (VND) (VND) (VND)
Opening balance 285,322,759,947 271,070,169,597 761,338,146,326 102,527,585,748 113,461,144,489 379,987,561,716 1,913,707,367,823
Additions 37,166,078,602 - 168,183,350,522 118,678,049,229 86,934,912,072 129,927,145,138 540,889,535,563
Transfer to intangible fixed assets - - (15,762,064,718) - - - (15,762,064,718)
Transfer from construction in

- - 67,569,133,992 11,795,008,748 12,104,949,858 2,315,788,759 93,784,881,357
progress
Disposal and written off (654,163,053) - (10,563,778,471) - (1,129,489,365) (977,057,596) (13,324,488,485)
Amortization for the year (48,944,343,139) (54,214,033,920) (77,474,246,916) (104,978,820,786) (85,188,423,168) (106,901,181,839) (477,701,049,768)
Reclassification - - 170,032,613,159 9,260,203,206 (5,217,450,122) (174,075,366,243) -

06. CONSOLIDATED
Decrease due to loss of control in

- - - (3,223,365) (3,533,881,617) (8,177,233,086) (11,714,338,068)
subsidiaries (Note 5)
Other movements (194,412,193) - (5,402,315,491) (6,976,169,382) 557,309,772 371,400,000 (11,644,187,294)
Closing balance (194,412,193) - (5,402,315,491) (6,976,169,382) 557,309,772 371,400,000 (11,644,187,294)

ANNUAL REPORT 2017
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06. CONSOLIDATED
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16. ACCOUNTS PAYABLE TO SUPPLIERS 17. TAXES AND OTHERS RECEIVABLE FROM AND PAYABLE TO STATE TREASURY
(a) Accounts payable to suppliers detailed by significant suppliers Details of taxes and others receivable from/(payable) to State Treasury at the reporting date are as follows:
COST AND AMOUNT WITHIN PAYMENT CAPACITY

1/1/2017 INCURRED DECREASE DUE TO PAID 31/12/2017
31/12/2017 1/1/2017 (VND) (VND) LOSS OF CONTROL IN (VND) (VND)
(VND) (VND) SUBSIDIARIES (NOTE 5)

(VND)
Binh Son Refining and Petrochemical Company Limited 4,076,925,314,975 3,371,735,224,955
Output value added tax (226,869,829,763) (3,367,777,921,679) 17,395,355,442 3,391,188,709,440 (186,063,686,560)
Petco Trading Lubuan Co Ltd 2,240,314,695,604 1,067,277,127,386
Value added tax – imported
321,175,863,531 (7,094,363,871,065) - 7,016,540,172,205 243,352,164,671
goods
Vitol Asia Pte Ltd 2,067,997,501,274 -
Special consumption tax 336,667,603,790 (3,082,137,718,912) - 3,014,262,981,423 268,792,866,301
Elico Oil Pte Ltd 1,163,214,659,293 -
Import-export tax 1,428,147,032,643 (2,646,112,930,140) (155,549) 3,542,382,235,198 2,324,416,182,152
Lukoil Asia Pacific Pte Ltd 1,083,522,813,908 693,545,785,710
Corporate income tax (444,780,610,390) (894,833,667,465) 14,627,387,021 1,118,582,308,573 (206,404,582,261)
Sahara Energy International Pte Ltd - 699,062,531,839
Personal income tax (14,153,325,294) (92,146,125,477) 1,163,951,777 89,885,166,330 (15,250,332,664)
Other suppliers 4,638,953,458,368 5,691,048,493,928
Land and housing taxes (80,735,568,673) (236,796,411,305) 2,094,724,910 249,968,826,351 (65,468,428,717)
15,270,928,443,422 11,522,669,163,818
Environmental protection tax (1,233,858,735,876) (20,376,543,146,035) - 20,442,381,630,493 (1,168,020,251,418)
(b) Accounts payable to suppliers who are related parties
Other taxes (25,953,097,570) (389,939,636,344) 121,357,968 400,277,745,401 (15,493,630,545)
COST AND AMOUNT WITHIN PAYMENT CAPACITY

59,639,332,398 (38,180,651,428,422) 35,402,621,569 39,265,469,775,414 1,179,860,300,959
31/12/2017 1/1/2017
In which:
(VND) (VND)
Taxes and others receivable
Accounts payable to joint ventures, associates 23,369,071,764 12,705,357,792 2,156,306,559,062 2,910,198,024,758
from State Treasury
Taxes and others payable to
(2,096,667,226,664) (1,730,337,723,799)
State Treasury
59,639,332,398 1,179,860,300,959
18. OTHER PAYABLES - SHORT-TERM
31/12/2017 1/1/2017
(VND) (VND)
Social, health and unemployment insurances, trade union fee 30,843,556,623 45,371,091,522
Others 212,523,686,083 328,171,323,853
243,367,242,706 373,542,415,375
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19. BORROWINGS 20. PROVISIONS – SHORT-TERM
(a) Short-term borrowings

31/12/2017 1/1/2017
(VND) (VND)
1/1/2017 MOVEMENT DURING THE YEAR 31/12/2017
Technical reserve incurred at PJICO - 2,820,195,317,884
CARRYING ADDITION DECREASE RECLASSIFI- FOREIGN DECREASE DUE CARRYING
AMOUNT AND (VND) (VND) CATION FROM EXCHANGE TO LOSS OF AMOUNT AND Others 44,890,213,714 147,987,667,107
AMOUNT WITHIN LONG-TERM DIFFERENCES CONTROL IN AMOUNT WITHIN
REPAYMENT BORROWINGS (VND) SUBSIDIARIES REPAYMENT 44,890,213,714 2,968,182,984,991
CAPACITY (VND) (VND) CAPACITY
(VND) (VND)
Short-term 21. PETROLEUM PRICE STABILISATION FUND
6,427,890,425,251 67,796,875,700,090 (61,005,892,771,332) 440,000,000 (5,720,203,976) (109,818,267,723) 13,103,774,882,310
borrowings (i)
Current portion 31/12/2017 1/1/2017
of long-term 610,119,207,029 15,112,272,728 (624,062,904,696) 641,305,897,997 (1,168,575,061) - 641,305,897,997 (VND) (VND)
borrowings (b)
Opening balance 1,830,978,066,020 2,377,393,168,988
7,038,009,632,280 67,811,987,972,818 (61,629,955,676,028) 641,745,897,997 (6,888,779,037) (109,818,267,723) 13,745,080,780,307
Increases 2,482,212,981,584 2,441,739,577,655
This mainly represents the bank loans in VND and in USD with terms ranging from 3 months to less than 12 months of the Parent Company,
Petrolimex Petrochemical Corporation - JSC, Petrolimex Singapore Pte. Ltd., Petrolimex Gas Corporation – JSC and Petrolimex Tanker Cor- Decreases (1,285,657,718,676) (2,997,837,152,123)
poration which are unsecured loans for the purposes of supplementing working capital and opening letters of credit (L/C) for petroleum import.
Interest income from the deposit account 12,547,265,951 9,682,471,500
During 2017, the annual interest rates for the VND loans ranged from 2.2% - 5.4% per annum and for the USD loans ranged from 1.85% -
2.05% per annum (2016: 3.8% - 4.3% per annum and 0.95% - 1.7% per annum, respectively). Closing balance 3,040,080,594,879 1,830,978,066,020
(b) Long-term borrowings In which:
31/12/2017 1/1/2017 Account balance of Petroleum price stabilisation fund at bank (Note 6) 3,215,870,855,058 1,529,199,064,366
(VND) (VND)
Amount (withdrawn from)/transferred to the account of Petroleum price
(175,790,260,179) 301,779,001,654
Long-term borrowings 3,047,743,109,732 3,462,507,717,009 stabilisation fund subsequent to the end of the annual accounting period
Closing balance 3,040,080,594,879 1,830,978,066,020

Repayable within twelve months (a) (641,305,897,997) (610,119,207,029)
Repayable after twelve months 2,406,437,211,735 2,852,388,509,980
Long-term borrowings mainly represent bank loans with terms ranging from more than 12 months to 120 months of subsidiaries of the Group.
Details are as follows:
31/12/2017 1/1/2017
(VND) (VND)
Vanphong Bonded Petroleum Terminal Joint Venture Company Limited 1,239,598,622,845 1,584,266,524,031
Vietnam Tanker Joint Stock Company 638,611,395,929 588,645,066,542
Vietnam Petroleum Transport Joint Stock Company 373,758,250,000 568,410,787,500
VP Petrochemical Transport J.S.C 302,122,405,900 338,288,387,736
Other subsidiaries 493,652,435,058 382,896,951,200
3,047,743,109,732 3,462,507,717,009
The purpose of these long-term borrowings are to finance the Group’s projects in investment and construction of petroleum terminals, pur-
chase of oil tankers, and other projects.
The long-term borrowings of the Group are mainly denominated in USD. Most of these USD loans bear floating annual interest rates which
are equal to 6-month LIBOR, SIBOR or 12-month and 13-month USD saving interest rates of the lending banks plus margin, but not lower
than the minimum lending interest rates of the corresponding banks at the time of adjustment or a floor interest rate specified in relevant loan
agreements.
The Group’s long-term borrowings are secured over tangible fixed assets with a total net book value as of 31 December 2017 of VND4,835,981
million (1/1/2017: VND5,446,600 million) and intangible fixed assets with a total net book value as of 31 December 2017 of VND45,922 million
(1/1/2017: VND9,705 million).
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22. CHANGES IN OWNERS’ EQUITY
SHARE CAPITAL CAPITAL SURPLUS OTHER CAPITAL TREASURY DIFFERENCES FOREIGN EXCHANGE INVESTMENT AND OTHER EQUITY RETAINED PROFITS NON-CONTROLLING TOTAL
(VND) (VND) (VND) SHARES UPON ASSET DIFFERENCES DEVELOPMENT FUND FUNDS (VND) INTEREST (VND)
(VND) REVALUATION (I) (VND) (VND) (VND) (VND)
(VND)
Balance at 1/1/2016 10,700,000,000,000 164,462,417 866,234,135,320 - (1,317,118,937,352) (65,910,358,919) 686,086,586,574 57,603,752,588 2,822,825,501,069 2,881,901,905,371 16,631,787,047,068
Shares issued 1,035,284,760,000 3,004,085,788,092 - - - - - - - 21,377,140,473 4,060,747,688,565
Expenses directly attributable to

- (620,000,000) - - - - - - - - (620,000,000)
share issuance
Writing down of deficit amount of
(347,152,410,000) - - - - - - - - - (347,152,410,000)
capital contribution by the State
Redeemable preferential shares
- - - - - - - - (1,550,648,460,000) - (1,550,648,460,000)
issued from net profit
Redeemable preferential shares
redeemed and converted to ordinary 1,550,648,460,000 - - (1,550,648,460,000) - - - - - - -
shares
Net profit for the year - - - - - - - - 4,669,396,347,454 478,037,274,857 5,147,433,622,311
Foreign exchange differences

arising from translation of foreign - - - - - (7,926,590,086) - - - - (7,926,590,086)
operations
Dividends - - - - - - - - (93,035,083,760) (56,927,094,345) (149,962,178,105)
Bonus shares - - 88,500,000,000 - - - (81,347,418,133) (7,152,581,867) - -
Appropriation to equity funds - - - - - - 173,777,307,892 15,438,333,430 (189,215,641,322) - -
Appropriation to Bonus and welfare

- - - - - - - - (361,889,981,856) (44,507,819,853) (406,397,801,709)
funds
Capital increase from investment
- - 22,836,789,207 - - - (22,836,789,207) - - - -
and development fund
Divestments by non-controlling
- - - - - - - - - (41,250,000,000) (41,250,000,000)
interest
Other movements - - 12,542,983,193 - - - (11,987,893,521) 7,952,634,979 (128,067,996,611) (15,845,597,046) (135,405,869,006)

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22. THAY ĐỔI VỐN CHỦ SỞ HỮU (TIẾP THEO)
SHARE CAPITAL CAPITAL SURPLUS OTHER CAPITAL TREASURY DIFFERENCES FOREIGN EXCHANGE INVESTMENT AND OTHER EQUITY RETAINED PROFITS NON-CONTROLLING TOTAL
(VND) (VND) (VND) SHARES UPON ASSET DIFFERENCES DEVELOPMENT FUND FUNDS (VND) INTEREST (VND)
(VND) REVALUATION (I) (VND) (VND) (VND) (VND)
(VND)
Balance at 1/1/2017 12,938,780,810,000 3,003,630,250,509 990,113,907,720 (1,550,648,460,000) (1,317,118,937,352) (73,836,949,005) 743,691,793,605 80,994,720,997 5,162,212,103,107 3,222,785,809,457 23,200,605,049,038
Treasury shares sold during the

- 811,067,745,500 - 200,000,000,000 - - - - - - 1,011,067,745,500
year (Note 23)
Expenses directly attributable to
- (1,664,309,589) - - - - - - - - (1,664,309,589)
re-issuance of treasury shares
Net profit for the year - - - - - - - - 3,468,269,610,133 443,393,090,327 3,911,662,700,460
Use of share premium for restructur-

- (1,566,036,132,797) - - - - - - 1,566,036,132,797 - -
ing subsidiary (wholly owned)
Foreign exchange differences
arising from translation of overseas - - - - - 79,262,876,853 - - - - 79,262,876,853
operations
Dividends (Note 24) - - - - - - - - (3,736,013,869,640) (268,565,128,399) (4,004,578,998,039)
Bonus shares - - 4,283,717,700 - - - - - (4,283,717,700) - -
Appropriation to equity funds (Note 25) - - - - - - 206,492,694,929 1,252,002,338,768 (1,458,495,033,697) - -
Appropriation to bonus and welfare

- - - - - - - - (393,243,150,840) (45,509,258,595) (438,752,409,435)
funds
Increase of capital from investment
- - 7,500,000,000 - - - (7,500,000,000) - - - -
and development fund
Movements due to loss of control in
- - 130,512,608,377 - - - (5,135,743,860) (4,478,235,338) (4,712,439,131) (552,906,900,638) (436,720,710,590)
subsidiaries
Capital contribution by non-con-
- - - - - - - - - 35,562,201,567 35,562,201,567
trolling shareholders during the year
Other movements - - - - - - 14,138,444,904 4,706,754,745 (21,200,080,828) 29,895,900,366 27,541,019,187
Balance at 31/12/2017 12,938,780,810,000 2,246,997,553,623 1,132,410,233,797 (1,350,648,460,000) (1,317,118,937,352) 5,425,927,848 951,687,189,578 1,333,225,579,172 4,578,569,554,201 2,864,655,714,085 23,383,985,164,952
As at 31 December 2017, item “Differences upon asset revaluation” in the Group’s consolidated balance sheet represents the consolidation
adjustments with an amount of VND1,317,118,937,352 for the differences between the value of investments in subsidiaries and associates
revaluated as per the Valuation Minutes issued by Vietnam Valuation and Finance Consultancy Joint Stock Company and the value of equity
in the investees (including an adjustment for revaluation of investments in subsidiaries of VND1,302,361,011,837 and an adjustment for reval-
uation of investments in associates of VND14,757,925,515) (Note 3(r)).
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23. SHARE CAPITAL (b) Foreign currencies
The Group’s authorized and issued share capital are: 31/12/2017 1/1/2017
VND VND
31/12/2017 1/1/2017 ORIGINAL CURRENCY ORIGINAL CURRENCY
EQUIVALENT EQUIVALENT
NUMBER OF SHARES VND NUMBER OF SHARES VND
USD 8,893,808 201,543,548,422 14,523,101 306,220,598,167
Authorized share capital 1,293,878,081 12,938,780,810,000 1,293,878,081 12,938,780,810,000
JPY 1,147,274 9,026,475,701 820,393 152,552,078
Shares in circulation 1,158,813,235 11,588,132,350,000 1,138,813,235 11,388,132,350,000
EUR 43,104 95,595,735,550 9,639 45,069,721
The State 981,686,626 9,816,866,260,000 981,686,626 9,816,866,260,000
306,165,759,673 306,418,219,966
Other shareholders 177,126,609 1,771,266,090,000 157,126,609 1,571,266,090,000
27. FINANCIAL INCOME
Treasury shares 135,064,846 1,350,648,460,000 155,064,846 1,550,648,460,000
2017 2016
All ordinary shares have a par value of VND10,000. Each share is entitled to one vote at meetings of the Group. Shareholders are entitled to (VND) (VND)
receive dividend as declared from time to time. All ordinary shares are ranked equally with regard to the Group’s residual assets. In respect
Interest income from deposits and loans 515,204,241,477 473,134,296,877
of shares bought back by the Group, all rights are suspended until those shares are reissued.
Gains from investments in bonds, promissory notes and treasury bills 5,225,916,191 10,832,374,315
Movements in share capital in circulation during the year were as follows:
Dividends or profits received 39,536,439,531 21,435,059,116
31/12/2017 1/1/2017
Realised foreign exchange gains 200,298,636,528 289,458,013,631
VND VND
NUMBER OF SHARES NUMBER OF SHARES
(AT PAR VALUE) (AT PAR VALUE) Unrealised foreign exchange gains 12,267,795,257 4,779,350,378
Opening balance 1,138,813,235 11,388,132,350,000 1,035,284,759 10,352,847,590,000

Interest from credit sales 10,451,832,382 21,116,068,974
Shares issued during the year - - 103,528,476 1,035,284,760,000

Other financial income 8,158,535,035 59,123,423,356
Treasury shares sold during the year 20,000,000 200,000,000,000 - -

791,143,396,401 879,878,586,647
Closing balance 1,158,813,235 11,588,132,350,000 1,138,813,235 11,388,132,350,000

28. FINANCIAL EXPENSES
24. DIVIDENDS
2017 2016
(VND) (VND)
On 25 April 2017, the General Meeting of Shareholders passed the Resolution No. 01/2017/PLX-NQ-DHDCD (“Resolution 01”) on the plan
for distribution of 2016 dividends in cash at the ratio of 32.24% of the par value or VND3,736,013,869,640 (dividend distributed in 2016: Interest expense 570,685,109,732 551,519,187,171
VND93,035,083,760). This amount was paid in August 2017.
Interest from credit sales 6,151,030,222 6,042,705,721
25. EQUITY FUNDS
Realised foreign exchange losses 165,133,193,699 172,453,849,732
(a) Investment and development fund
Unrealised foreign exchange losses 5,798,722,377 65,707,191,572
Investment and development fund is established for the purpose of future business expansion.
Allowance for long-term and short-term financial investments 14,352,470,408 (779,076,904)
(b) Other equity funds
Other financial expenses 28,524,015,673 49,153,943,548
According to Resolution 01, the General Meeting of Shareholders approved the plan to make appropriations to Other equity funds amounting
790,644,542,111 844,097,800,840
to VND1,252,002,338,768. Other equity funds shall be used for distribution of profit to shareholders in subsequent years.
26. OFF BALANCE SHEET ITEMS
(a) Goods held for third parties

31/12/2017 1/1/2017
(VND) (VND)
Gasoline RON 92 Lít 15 75,486,010 76,346,178
Diesel 0.05S Lít 15 139,260,340 139,440,815
Mazut Kg 39,766,466 39,780,782

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29. SHARE OF PROFIT IN ASSOCIATES AND JOINT VENTURES 32. INCOME TAX
2017 2016 (a) Income tax expense by consolidated business segment

(VND) (VND)
2017 2016
Joint venture: (VND) (VND)
Castrol BP PETCO Co. Ltd. 394,054,084,407 544,060,684,657 Petroleum trading 685,221,035,425 925,732,508,252
Associates: Petrochemical products 43,676,177,907 51,829,434,828
Petrolimex Group Commercial Joint Stock Bank 26,169,695,664 49,749,866,805 Gas products 39,639,022,623 28,122,509,182
Petrolimex Joint Stock Insurance Company 15,341,622,449 - Insurance services 20,446,886,389 23,423,922,783
Petrolimex Construction Joint Stock Company I 12,013,659,894 - Transportation services 71,361,154,621 99,515,635,575
Dong Nai Petroleum Material and Fuel Joint Stock Company 4,045,645,916 3,992,956,784 Other goods and services 12,960,162,592 24,128,878,419
Other associates 4,429,886,786 1,943,905,766 873,304,439,557 1,152,752,889,039
456,054,595,116 599,747,414,012
(b) Recognised in the consolidated statement of income
30. SELLING EXPENSES

2017 2016
(VND) (VND)
2017 2016
(VND) (VND) Current tax expense
Labour costs and staff costs 3,183,684,688,435 2,877,024,601,505 Current year 855,873,946,373 1,152,206,706,935
Materials and packaging expenses 34,436,038,176 56,477,371,706 Under provision in prior years 38,959,721,092 -
Tools and supplies 136,483,947,455 254,070,920,076 894,833,667,465 1,152,206,706,935
Depreciation and amortisation 696,467,005,331 589,592,133,707 Deferred tax (benefit)/expense
Other cash expenses 3,269,664,885,601 3,924,163,826,819 Write down of deferred tax assets (21,529,227,908) 546,182,104
7,320,736,564,998 7,701,328,853,813 Income tax expense 873,304,439,557 1,152,752,889,039
31. PRODUCTION AND BUSINESS COSTS BY ELEMENT (c) Reconciliation of effective tax rate
2017 2016 2017 2016

(VND) (VND) (VND) (VND)
Raw material costs 3;910;189;173;636 3;832;960;153;613 Accounting profit before tax 4,784,967,140,017 6,300,186,511,350
Labour costs and staff costs 4;433;869;242;185 4;658;089;823;442 Tax at the Parent Company’s tax rate 956,993,428,003 1,260,037,302,270
Depreciation and amortisation 2;270;612;080;495 2;051;896;891;805 Effect of different tax rates applicable to PLS and VPT (20,381,840,413) (7,283,136,441)
Outside services 4;928;172;960;560 5;956;312;805;667 Non-deductible expenses 10,729,809,368 15,477,410,609
Other expenses 1;244;249;261;913 1;274;010;260;050 Deferred tax assets not recognised 6,858,542,044 49,888,634,821
Tax exempt income (99,117,625,861) (124,236,494,626)
Under provision in prior years 38,959,721,092 -
Tax losses utilised for which no deferred tax assets were recognised
(20,737,594,676) (41,130,827,594)
previously
873,304,439,557 1,152,752,889,039
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PETROLIMEX
32. INCOME TAX (CONTINUED)

2017 2016
(VND) (VND)
(d) Applicable tax rates
Petrolimex Joint Stock Insurance Company
UNDER THE TERMS OF THE CURRENT LAW ON CORPORATE INCOME TAX, THE PARENT COMPANY AND ITS SUBSIDIARIES
HAVE AN OBLIGATION TO PAY THE GOVERNMENT INCOME TAX AT THE RATE OF 20% OF TAXABLE PROFITS FROM 2016, EX- Purchases of services 431,974,444,356 -
CEPT PETROLIMEX SINGAPORE PTE. LTD AND VANPHONG BONDED PETROLEUM TERMINAL JOINT VENTURE COMPANY LIMIT-
Petrolimex Construction Joint Stock Company I
ED (“VPT”) WHOSE APPLICABLE TAX RATE IS 10%.
Purchase of assets 76,496,008,863 -
33. EARNINGS PER SHARE
Petrolimex Construction Joint Stock Company III
The calculation of basic earnings per share for the year ended 31 December 2017 was based on the profit attributable to ordinary share-
holders of VND3,468,269,610,133 (2016: VND4,669,396,347,454) and a weighted average number of ordinary shares during the year of Purchase of assets 93,919,924,051 -
1,150,977,619 shares (2016: 1,097,685,484 shares), calculated as follows:
Board of Management and Supervisory Board
(i) Weighted average number of ordinary shares
Salaries, bonuses and other benefits 12,493,249,250 4,799,342,500
2017 2016
Board of General Directors
Issued ordinary shares at the beginning of the year 1,138,813,235 1,035,284,759

Salaries, bonuses and other benefits 9,116,330,750 2,238,861,750
Effect of ordinary shares issued during the year - 62,400,725

35. CONTINGENT FOREIGN CONTRACTOR TAX LIABILITIES
Effect of reissuance of treasury shares during the year 12,164,384 -
The Parent Company - Vietnam National Petroleum Group paid foreign contractor tax according to the conclusion of the State Audit of Viet-
Weighted average number of ordinary shares during the year 1,150,977,619 1,097,685,484 nam in the Minutes of 2016 Audit for the period from 2012 to 2016 on the basis of net profit of the foreign contractors, and declared and paid
foreign contractor tax for 2017 based on the calculation method in the conclusion of the State Audit of Vietnam for the goods purchased from
(ii) Basic earnings per share the foreign contractor in the Van Phong Bonded Warehouse. Concurrently, the State Audit of Vietnam recommended the Group to continue to
work with Vietnamese relevant agencies on how to calculate foreign contractor tax to provide a basis for implementation. At present, Vanphong
2017 2016 Bonded Petroleum Terminal Joint Venture Company Limited (a subsidiary of the Group) is working with the General Department of Taxation
(VND) (VND)
to obtain a guiding official letter.
Consolidated net profit attributable to shareholders (*) 3,468,269,610,133 4,669,396,347,454
36. CORRESPONDING FIGURES
Weighted average number of ordinary shares during the year 1,150,977,619 1,097,685,484
Corresponding figures as at 1 January 2017 were derived from the balances and amounts reported in the Company’s consolidated financial
Basic earnings per share 3,013 4,254 statements as at and for the year ended 31 December 2016.
(*) Net profit attributable to the Parent Company’s shareholders does not include the amount appropriated to Bonus and welfare funds as these
30 MARCH 2018
funds were not appropriated for the year ended 31 December 2017. The Parent Company has not yet planned to appropriate funds to the
Bonus and welfare funds for 2017. Basic earnings per share may decrease due to the appropriation of Bonus and welfare funds.
34. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES
In addition to related party balances disclosed in other notes to the consolidated financial statements, the Group had the following significant
transactions with related parties during the year:
2017 2016
(VND) (VND)
Associates, joint ventures
Castrol BP PETCO Co. Ltd. Dang Hong Lien Luu Van Tuyen Pham Duc Thang
Dividends received 532,960,684,657 552,701,089,196
Purchase of goods 24,172,276,507 -
Petrolimex Group Commercial Joint Stock Bank
Purchase of foreign currencies 31,336,938,082,570 6,760,533,645,003
Interest income from deposits 63,550,177,859 52,309,725,070

170 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
APPENDIX 3: CONVERTED CONSOLIDATED APPENDIX 1: CONVERTED CONSOLIDATED

STATEMENT OF CASH FLOWS BALANCE SHEET AS AT 31 DECEMBER 2017
FOR THE YEAR ENDED 31 DECEMBER 2017 (CONTINUED)
(INDIRECT METHOD)
CODE 31/12/2017 1/1/2017 CODE 31/12/2017 1/1/2017

USD USD USD USD
ASSETS LONG-TERM ASSETS (200 = 210 + 220 + 230 + 240 + 250 + 260) 200 937,246,431 920,727,852
CURRENT ASSETS (100 = 110 + 120 + 130 + 140 + 150) 100 Accounts receivable – long-term 210 3,912,841 2,100,650
Cash and cash equivalents 110 1,788,059,595 1,472,584,942 Accounts receivable from customers – long-term 211 3,324,158 1,591,361
Cash 111 251,749,610 191,576,611 Other long-term receivables 216 1,769,382 2,226,219
Cash equivalents 112 375,800,423 309,354,348 Allowance for doubtful long-term debts 219 (1,180,699) (1,716,930)
Short-term financial investments 120 110,523,173 117,079,812 Fixed assets 220 673,759,712 690,318,723
Trading securities 121 265,663 3,490,652 Tangible fixed assets 221 587,942,416 606,722,955
Allowance for diminution in the value of trading securities 122 (90,583) (891,025) Cost 222 1,293,132,786 1,245,275,604
Held-to-maturity investments 123 110,348,093 114,480,185 Accumulated depreciation 223 (705,190,370) (638,552,649)
Accounts receivable – short-term 130 329,235,125 305,244,188 Intangible fixed assets 227 85,817,296 83,595,768
Accounts receivable from customers 131 300,547,198 272,864,275 Cost 228 109,772,803 104,696,635
Prepayments to suppliers 132 16,531,202 20,033,387 Accumulated amortisation 229 (23,955,507) (21,100,867)
Other receivables 136 26,054,173 31,034,825 Investment property 230 7,291,693 11,303,016
Allowance for doubtful debts 137 (13,932,841) (18,727,144) Cost 231 9,763,620 13,870,187
Shortage of assets awaiting resolution 139 35,393 38,845 Accumulated depreciation 232 (2,471,927) (2,567,171)
Inventories 140 567,727,827 380,633,541 Long-term work in progress 240 34,419,736 26,680,010
Inventories 141 568,751,854 381,371,117 Long-term work in progress 241 105,619 -
Allowance for inventories 149 (1,024,027) (737,576) Construction in progress 242 34,314,117 26,680,010
Other current assets 150 153,023,437 168,696,442 Long-term financial investments 250 127,240,769 105,051,520
Short-term prepaid expenses 151 9,586,695 11,945,964 Investments in associates, joint-ventures 252 118,155,210 89,480,408
Deductible value added tax 152 13,489,728 12,228,340 Equity investments in other entities 253 13,906,749 15,692,666
Taxes and others receivable from State Treasury 153 128,400,531 95,138,167 Allowance for diminution in the value of long-term financial investments 254 (4,887,371) (5,080,742)
Other current assets 155 1,546,483 49,383,971 Held-to-maturity investments 255 66,181 4,959,188
172 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
CODE 31/12/2017 1/1/2017 CODE 31/12/2017 1/1/2017

USD USD USD USD
Other long-term assets 260 90,621,680 85,273,933 EQUITY (400 = 410) 400 1,031,722,267 1,023,631,373
Long-term prepaid expenses 261 89,046,356 84,434,475 Owners’ equity 410 1,031,722,267 1,023,631,373
Deferred tax assets 262 1,454,428 487,852 Share capital 411 570,870,541 570,870,541
Long-term tools, supplies and spare parts 263 976 976 Ordinary shares with voting rights 411a 570,870,541 570,870,541
Other long-term assets 268 119,920 350,630 Capital surplus/Share premium 412 99,139,535 132,522,844
TOTAL ASSETS (270 = 100 + 200) 270 2,725,306,026 2,393,312,794 Other capital 414 49,962,949 43,684,708
RESOURCES Treasury shares 415 (59,591,814) (68,415,992)
LIABILITIES (300 = 310 + 330) 300 1,693,583,759 1,369,681,421 Differences upon asset revaluation 416 (58,112,461) (58,112,461)
Current liabilities 310 1,577,665,654 1,232,825,063 Foreign exchange differences 417 239,397 (3,257,752)
Accounts payable to suppliers 311 673,766,973 508,390,433 Investment and development fund 418 41,989,287 32,812,345
Advances from customers 312 8,863,513 23,234,089 Other equity funds 420 58,823,101 3,573,559
Taxes and others payable to State Treasury 313 76,344,043 92,506,827 Retained profits 421 202,010,569 227,761,399
Payables to employees 314 40,685,784 46,480,634 Retained profits brought forward 421a 48,987,423 227,761,399
Accrued expenses 315 11,855,168 8,179,301 Retained profit for the current year 421b 153,023,146 -
Unearned revenue – short-term 318 576,439 3,310,920 Non-controlling interest 429 126,391,163 142,192,182
Other payables – short-term 319 10,737,580 16,481,022 TOTAL RESOURCES (440 = 300 + 400) 440 2,725,306,026 2,393,312,794
Short-term borrowings 320 606,445,214 310,523,258

The converted consolidated balance sheet as at 31 December 2017, including amounts presented for the corresponding figures, has
Provisions – short-term 321 1,980,596 130,958,879
been translated from the reviewed consolidated balance sheet as at 31 December 2017 expressed in VND at the foreign currency
transfer rate ruling at the reporting date as quoted by the Joint Stock Commercial Bank for Foreign Trade of Vietnam of VND22,665
Bonus and welfare funds 322 12,279,279 11,975,316 for USD1. This method of translation does not comply with Vietnamese Accounting Standard No. 10 – “The Effect of Changes in
Foreign Exchange Rates” and accordingly, the converted consolidated balance sheet as at 31 December 2017 is not intended to be
Petroleum price stabilisation fund 323 134,131,065 80,784,384
a presentation in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and the relevant regulatory
Long-term liabilities 330 115,918,105 136,856,358 requirements applicable to interim financial reporting. The converted consolidated balance sheet should be read in conjunction with
the reviewed consolidated balance sheet in VND.
Long-term advances from customers 332 480,788 494,633
Long-term accrued expenses 333 40,081 12,816 30 MARCH 2018
Long-term unearned revenue 336 638,818 403,477

Other payables – long-term 337 7,372,002 8,907,471
Long-term borrowings 338 106,174,154 125,849,923
Deferred tax liabilities 341 235,736 215,253
Provisions – long-term 342 841,262 465,172
Science and technology development fund 343 135,264 507,613

174 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
APPENDIX 3: CONVERTED CONSOLIDATED

STATEMENT OF CASH FLOWS
(INDIRECT METHOD)
The converted consolidated statement of income for the year ended 31 December 2017, including amounts presented for the corresponding
CODE 31/12/2017 1/1/2017
USD USD
figures, has been translated from the reviewed consolidated statement of income for the year ended 31 December 2017 expressed in VND
at the foreign currency transfer rate ruling at the reporting date as quoted by the Joint Stock Commercial Bank for Foreign Trade of Vietnam
Revenue from sales of goods and provision of services 01 6,782,978,626 5,432,480,779 of VND22,665 for USD1. This method of translation does not comply with Vietnamese Accounting Standard No. 10 – “The Effect of Chang-
es in Foreign Exchange Rates” and accordingly, the converted consolidated statement of income for the year ended 31 December 2017
Revenue deductions 02 1,727,496 1,352,740 is not intended to be a presentation in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and the
relevant regulatory requirements applicable to interim financial reporting. The converted consolidated statement of income should be read in
Net revenue (10 = 01 - 02) 10 6,781,251,130 5,431,128,039
conjunction with the reviewed consolidated statement of income in VND.
Cost of sales 11 6,238,717,499 4,804,387,032
Gross profit (20 = 10 - 11) 20 542,533,631 626,741,007

30 MARCH 2018
Financial income 21 34,905,952 38,821,027
Financial expenses 22 34,883,942 37,242,347
In which: Interest expense 23 25,179,136 24,333,518
Share of profit in associates and joint ventures 24 20,121,535 26,461,390
Selling expenses 25 322,997,422 339,789,493
General and administration expenses 26 36,090,631 44,851,051
Net operating profit {30 = 20 + (21 - 22) + 24 - (25 + 26)} 30 203,589,123 270,140,533
Other income 31 14,328,815 14,855,019 Accountant Chief Accountant General Director
Other expenses 32 6,800,923 7,025,710
Results of other activities (40 = 31 - 32) 40 7,527,892 7,829,309
Accounting profit before tax (50 = 30 + 40) 50 211,117,015 277,969,842
Income tax expense – current 51 39,480,859 50,836,387
Income tax (benefit)/expense – deferred 52 (949,889) 24,098
Net profit after tax (60 = 50 - 51 - 52) 60 172,586,045 227,109,357
Attributable to:
Equity holders of the Parent Company 61 153,023,146 206,017,928
Non-controlling interest 62 19,562,899 21,091,429
Earnings per share
Basic earnings per share 70 0.1329 0.1877

176 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
APPENDIX 3: CONVERTED CONSOLIDATED STATEMENT OF CASH

FLOWS FOR THE YEAR ENDED 31 DECEMBER 2017
(INDIRECT METHOD)
CODE 31/12/2017 1/1/2017 CODE 31/12/2017 1/1/2017

USD USD USD USD
CASH FLOWS FROM OPERATING ACTIVITIES CASH FLOWS FROM FINANCING ACTIVITIES
ACCOUNTING PROFIT BEFORE TAX 01 211,117,015 277,969,842 Proceeds from equity issued 31 - 179,163,807
Adjustments for Proceeds from transfer of treasury shares 31 44,535,779 (21,932,448)
Depreciation and amortisation 02 100,181,429 90,531,520 Proceeds from borrowings 33 3,005,352,347 2,647,416,318
Allowances and provisions 03 7,028,318 15,279,900 Payments to settle loan principals 34 (2,723,246,817) (2,905,322,553)
Exchange (gains)/losses arising from revaluation of monetary items denominated Payments of dividends 36 (175,516,537) (6,616,465)
04 (285,421) 2,338,462
in foreign currencies
Net cash flows from financing activities 40 151,124,772 (107,291,341)
Profits from investing activities 05 (44,340,339) (46,887,899)
Net cash flows during the year (50 = 20 + 30 + 40) 50 128,849,277 3,979,015
Interest expense 06 26,414,536 24,333,518
Cash and cash equivalents at the beginning of the year 60 500,930,959 498,066,322
Other adjustments 07 52,793,085 (24,336,273)
Effect of exchange rate fluctuations on cash and cash equivalents 61 (2,230,203) (1,114,378)
Operating profit before changes in working capital 08 352,908,623 339,229,070
Cash and cash equivalents at the end of the year (70 = 50 + 60 + 61) 70 627,550,033 500,930,959
Change in receivables 09 58,278,042 (60,462,449)
Change in inventories 10 (187,380,737) (40,659,746) The converted consolidated statement of cash flows for the year ended 31 December 2017, including amounts presented for the corre-
sponding figures, has been translated from the reviewed consolidated statement of cash flows for the year ended 31 December 2017 ex-
Change in payables and other liabilities 11 (62,459,999) 51,860,851 pressed in VND at the foreign currency transfer rate ruling at the reporting date as quoted by the Joint Stock Commercial Bank for Foreign
Trade of Vietnam of VND22,665 for USD1. This method of translation does not comply with Vietnamese Accounting Standard No. 10 – “The
Change in prepaid expenses 12 5,087,885 653,557
Effect of Changes in Foreign Exchange Rates” and accordingly, the converted consolidated statement of cash flows for the year ended 31
Change in trading securities 13 3,224,990 (416,991) December 2017 is not intended to be a presentation in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting
System and the relevant regulatory requirements applicable to interim financial reporting. The converted consolidated statement of cash
169,658,804 290,204,292
flows should be read in conjunction with the reviewed consolidated statement of cash flows in VND.
Interest paid 14 (25,299,844) (24,462,814)
30 MARCH 2018
Income tax paid 15 (49,352,848) (43,963,531)
Other payments for operating activities 17 (16,605,227) (15,677,606) Prepared by: Approved by:
Net cash flows from operating activities 20 78,400,885 206,100,341
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for additions to fixed assets and other long-term assets 21 (131,607,965) (141,011,329)
Proceeds from disposals of fixed assets and other long-term assets 22 2,270,124 761,872
Payments for granting loans, purchase of debt instruments of other entities 23 (57,055,812) (35,471,390)
Receipts from collecting loans, sales of debt instruments of other entities 24 43,694,192 21,683,081 Dang Hong Lien Luu Van Tuyen Pham Duc Thang
Payments for investments in other entities 25 (6,966,618) (548,096)
Collections on investments in other entities 26 - 6,590,259
Receipts of interests, dividends and share of profit 27 48,989,699 53,165,618

178 PETROLIMEX
ANNUAL REPORT 2017
06. CONSOLIDATED
06. CONSOLIDATED
PETROLIMEX
CONTACT
VIETNAM NATIONAL PETROLIUM GROUP
Name: PETROLIMEX (HOSE: PLX)

Address: No. 01 Kham Thien str., Dong Da dist., Hanoi city
Tel: (024) 3851-2603
Fax: (024) 3851-9203
Website: www.petrolimex.com.vn
PETROLIMEX
INSURANCE

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01.

1 Brief overview 12 1 Production and business 50 1 Evaluation on production and 68

MISSION 7 Administration model, business

Raising shareholders’ value, bringing management

welfare to laborers, communities; raising

1 Evaluation on the performance 88 1 Board of Directors 98

With the tradition of the Vietnamese revolutionary petroleum in-

Switching to joint stock model operating under Enterprise Law,

In 2017, the Group’s production and business results were rela-

Chairman of Board of Management

Bui Ngoc Bao

Excellencies, (Ladies and Gentlemen,)

PETROLIMEX 8. Value chain

Abbreviated name PETROLIMEX

Ticker symbol PLX

Certificate of Business Reg- 0100107370

Authorized capital 12,938,780.810,000 VND

Owner’s equity 12,938,780,810,000 VND

Address No.1 Kham Thien Street, Kham Thien Ward,

Tel. (024) 3851 2603

Fax (04) 3851 9203

1956 2011 2011 2016 2016

1995 2011 2012 2016 2017

FUEL CONSTRUCTION TRANSPORTATION

PETROLEUM PETRO- GAS

WATERWAY ROAD COMMERCE

AND OIL IN 2017

DIVERSITY HUMANITY ENTHUSIASM RESPONSIBILITY

We care about em-

Certificate of Merit from the The Second Labor Order

Labor Hero Period Hero of the People’s

Certificate of Merit from the TOP 500 largest enterprises

poration (PGT) providing petroleum ture Companies, associated companies in

CORPORATE OFFICERS 68 SUBSIDIARIES 14 JOINT-VENTURE, ASSOCIATED COMPANY

7. FINANCIAL HIGHLIGHTS 6.000

ORDER INDICATIORS UNIT

Mil Petroleum 74,58% Petroleum 77,90% Petroleum 72,07%

Transport services 8,68% Transport services 8,01% Transport services 10,25%

Other services 4,08% Other services 6,17% Other services 6,22%

CONSOLIDATED NET REVENUE TOTAL ASSETS

OWNER’S EQUITY SALE VOLUME OF PETROL AND OIL

570km 150.000 DWT

5.200 15% TOP 5 30 BRANDS

Strengths (S) Weaknesses (W) Opportunities (O) Threats (T)

Petroleum and petrochemical products, Petroleum, petrochemical products are

1. Production and business performance

Current address Foreign Language English Current address Current address

Political Qualifications Advanced Political Qualifications Bachelor

Foreign Language English

Hometown Hometown Hometown Hometown

Current address Current address Current address Current address

Qualifications Qualifications Qualifications Qualifications

2.2. 2.3.2 Policies to laborers

2.4. THE ANNUAL GENERAL MEETING

25,026 18,126 11,141,000 - Information and Technology Department

Financial and accounting board

Consulting General Director in commanding,

Public Relation Department

Technical Technology and Safety De-

THE INVESTMENT AND IMPLEMENTATION OF PROJECTS