February 2021
1
Disclaimer
IMPORTANT:The information contained herein is preliminary and subject to change without notice, its accuracy is not guaranteed, has not been independently verified and may not contain all material information concerning Vincom Retail Joint Stock Company (the“Company”) and its subsidiaries (the “Group”). You should not rely upon it or use it to form the basis for any investment decision or commitment whatsoever.
None of the Company, its shareholders, or any of their respective affiliates, directors, officers, employees, agents, advisers or any other person makes any representation or warranty (express or implied) or accepts any responsibility or liability for the accuracy or completeness of this presentation or any or all of the information in this presentation or otherwise made available. It is not the intention to provide, and you may not rely on these materials as providing, a complete or comprehensive analysis of the financial or trading position or prospects of the Group. No part of this presentation shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. Further, nothing in this presentation should be construed as constituting legal, business, tax or financial advice. You should conduct such independent investigations and analysis of the Group as you deem necessary or appropriate in order to make an independent determination of the suitability, merits and consequences of investment in the Company.
This presentation contains “forward-looking statements”. These forward-looking statements involve known and unknown risks and uncertainties, many of which are beyond the Company’s control and all of which are based on management’s current beliefs and expectations about future events. Forward-looking statements are sometimes identified by the use of forward-looking terminology such as “believe”, “expects”, “may”, “will”, “could”, “should”, “shall”, “risk”, “intends”, “estimates”, “aims”, “targets”, “plans”, “predicts”, “continues”, “assumes”, “positioned” or “anticipates” or the negative thereof, other variations thereon or comparable terminology. These forward-looking statements include all matters that are not historical facts. Forward-looking statements are not guarantees of future performance. These forward-looking statements speak only as at the date of this presentation, and none of the company, its shareholders, or any of their respective affiliates, directors, officers, employees, agents, advisers or any other person undertakes to update or revise any forward-looking statements as a result of new information or to reflect future events or circumstances.
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Vincom Retail
(“VRE”) is the largest and fastest growing retail developer, owner
and operator in Vietnam
Key investment highlights are as follows:
Market leader in terms of the shopping mall GFA in Vietnam’s major cities…
…
the direct proxy for consumer demand
Proven Track Record of
Highly Scalable Platform
with Strong Operating
Performance
Vietnam Economy
Remains Resilient
Amidst Covid-19
Outbreak
Ability to Leverage the
Best-in-Country
Vingroup Ecosystem
Modern Retail Set to
Take Off
Institutional Level
Corporate Governance
Largest and Most
Dominant Retail Platform
The Dominant and Fastest Growing Retail Platform in Vietnam
Executive Summary
2
3 Leading hospital operator About 750 beds under operation 7 full-service general hospitals and 5 clinics Leading hospitality operator in Vietnam Approx. 17,500 rooms owned & managed Premium and large scale real estate developer Largest in Vietnam 27,700 units presold(3) (Contracted sales of VND 64 trillion(4)) Leading private school operator About 29,300 students registered at 35 facilities(5)
Vingroup & Vincom Retail: Market Leaders In Vietnam
~28% NLA leased to internal and affiliated tenants(2)
1.7 mn
Retail GFA (sqm)80
Operational Malls HanoiHo Chi Minh City
Vincom Retail is the Ultimate Consumer Play for Vietnam
Note:
(1) Refers to Vinhomes’ landbank (2) MSN-Vincommerce is an affiliated tenant (3) For FY2020, estimated pre-sale under SPAs and pre-sale bookings under deposits, including bulk sales deposits (4) Include retail and bulk sales value (5) (6) (7) (8) (9) As of 31 Dec 2020
Vincom Retail
A Key Subsidiary of Vingroup JSCLargest Retail
Developer, Owner
and Operator in
Vietnam
Vincom Retail
VinID:
~11 mn Members, Largest Loyalty Program in Vietnam
(5)Largest Listed Company in Vietnam
Largest Real Estate Developer in Vietnam
Vincom Mega Mall No. of Malls: 3 Retail GFA: 444,098 sqm (24% total) Vincom Plaza No. of Malls: 54 Retail GFA: 857,517 sqm (53% total) Vincom Center No. of Malls: 7 Retail GFA: 280,026 sqm (18% total) Vincom+ No. of Malls: 15 Retail GFA: 71,936 sqm (5% total)
Unique Multi format Model
(8) (9) c. 168 mm sqm of Landbank(1)
VinFast:Flagship automobile and e-motorcycle showrooms
Vinhomes:
Vietnam’s largest real estate developer
Vinschool:
Leading private school operator First Vietnam-ese smart and green vehicle manufactu-rer 76,900 cars and electric motor-cycles(6) Top 4 smartphone producer in Vietnam 1.9 million smart-phones sold(7) VinMart:
Vietnam’s largest modern grocery retail chain by presence
Ecosystem of Complementary Businesses
4
Emergence Of Vincom Retail As A Clear Market Leader
Early Years & Formation Establishing Platform For Growth
Accelerating Growth With
Dominant Market Share
2017
Listed on HOSE in November
H&M opened 2 stores in Hanoi and Ho Chi Minh City
Zara opened first store in Hanoi
Key tenants added: Inditex brands (Stradivarius, Massimo Dutti, Pull & Bear), H&M and Old Navy
2014
First Vincom shopping mall outside Hanoi & HCMC − VCP Ha Long First Robins department store in Vietnam opened in Royal City in April 2014
17 Years of Operating Experience Achieving ~1.7 mm sqm of Retail GFA (~35x Increase Since 2004)
2015
Vincom Mega Mall Thao Dien launched
US$100mm follow-on investment 10 new Vincom
shopping malls & Acquisition of 5 Maximark malls
2016
10 new Vincom shopping malls Introduction of Vincom+ format First Zara flagship store in Vietnam opened at Vincom Center Dong Khoi in HCMC
c.US$390mm Vingroup follow on investment
2004 - 2013
Royal City launched Times City launched US$200 million investment Best Retail Developer in Vietnam” by Euromoney in 2012 Note: As of 31 Dec 2020
Leasing revenue is based on Vietnam Accounting Standard (VAS) Audited Consolidated Financial Statements for respective years and Consolidated Financial Statements for 2020 (1) Leasing revenue took into account the impact of Vincom Retail’s supporting package to tenants impacted by Covid-19 in 2020, totaling VND 865bn
2018
Launched 20 shopping malls, including Landmark 81 Signed leasing contracts for approximately 191,000 sqm NLA and over 1,200 advertising contracts4
2019-2020
Launched 13 (2019) and 1 (2020) shopping malls and expanded our international tenant portfolio across key malls (Uniqlo, Decathlon, CGV, H&M, Mango, Muji, Pizza 4P’s, Haidilao) Pioneer in experiential retail-tainment in Vietnam 42 93 467 499 851 1,023 1,173 1,448 1,598 1,654 1,927 2,427 3,805 4,455 5,506 7,017 6,008 -20 980 1980 2980 3980 4980 5980 6980 7980 2004 2010 2013 2014 2015 2016 2017 2018 2019 2020 1 2 5 6 23 31 46 66 No. of malls Vincom Center Ba Trieu Vincom Center Dong Khoi 1stRetail Mall in Vietnam 1stIntegrated Project in Vietnam Leasing Revenue (VND bn) Investment by Warburg Pincus 80 79 2014 – 20 CAGR: Leasing revenue: 20.1% GFA: 22.0% Retail GFA (‘000 sqm) IPO and listed on HOSE (1)5
5
Retail Consolidates Around The Dominant Local Landlord
Global examples clearly demonstrate retail consolidation around the
dominant local landlord
Significant parallels seen between VRE and regional retail leaders
Vietnam's current position at an early, higher growth stage of the retail
cycle translates to a stronger growth profile and a more dominant market
share
Vincom Retail
Vietnam’s largest retail developer, owner and operator
SM Prime
Philippines’ largest retail real estate developer
Central Pattana
Thailand’s largest shopping mall developer arm of Central Group
CapitaLand Integrated Commercial Trust
Largestproxy for Singapore’s commercial real estate
Vietnam Thailand Singapore Indonesia Philippines 1.0 2016 2020 GFA (mm sqm) 2.2 9.8 2007 2019 2007 2019
GFA (mm sqm)(3) Market Share by GFA(2)
5.6%
15.4%
2011 2020
Market Share by NLA(3)
Source: Company filings, Colliers, Statista, Urban Redevelopment Authority, Savills, Urbis.
1. Based on Central Pattana’s retail NLA in Bangkok Metropolitan Area and total shopping mall NLA in Bangkok Metropolitan Area. 2. Based on SM Prime’s retail GFA in Metro Manila and total retail GFA in Metro Manila.
3. Based on retail floor space supply in Singapore (2009-2024), extracted from Capitaland Mall Trust (CMT) Annual Report 2019 4. Based on PT. PakuwonJati’s retail NLA as of Dec-2012 and 3Q 2020 vs. shopping mall NLA of Jakarta
10.7mm 7.8mm
Total Market Size (NLA sq. ft)(3)
67.4mm
Total Market Size (GFA sqm)(2)
2013 2020
15% 20%
2013 2020
GFA (mm sqm)(1) Market Share by GFA(1)
Total Market Size (GFA sqm)(1)
18.9mm 5.6mm 0.9 4.7 28% 50% 1.7 3.3 10.4 2011 2020 NLA (mm sq. ft) 58.9mm PT. Pakuwon Jati
Indonesia’s largest mall owner and operator
Market Share by NLA(4)
Total Market Size (NLA sqm)(4)
~2.5mm ~3.2mm(5) 0.3 0.7 2012 2020 NLA (mm sqm) 13.3% 20.4% 2012 2020
7
Vietnam’s Economy Remains Resilient Amidst Covid-19 Outbreak
‒ Vietnam On A Rebound – The Brightest Spot In SEA’s Economies
‒ Clearer Signs Of A Speedy Recovery; Ready For A “New Normal”
Huge Potential for Further Expansion in
Vietnam’s Retail Space
Modern Retail Set to Take Off
Only Retail Platform With Nationwide Access
Metro and Bus Infrastructure To Accelerate Retail Mall Footfall
1
2
Multi Format Model Covers a Larger Market Opportunity
Solidified Position as Dominant Retail Platform in Vietnam
Ability to Leverage the Best-in-Country Vingroup Ecosystem
4
Institutional Level Corporate Governance
3
5
Key Investment Highlights
8 Source: Bloomberg GDP consensus, GSO, CEIC and BMI
Highest Domestic Consumption Growth Country In ASEAN during 2020-2021
The Only Country In ASEAN Which Had Positive GDP Growth In 2020E And The Strongest GDP Growth Forecast in 2021E Real GDP growth (%)
Vietnam GDP to continue growing in 2021 led by a recovery in domestic consumption, resilient FDI due to supply chain shift and public investment
Free trade agreements such as CPTPP, EVFTA and RCEP to boost Vietnam's foreign trade
Highest Level Of Public Investment Spending As % Of GDP To Support Local Economy Public investment as % of GDP (2021 Target)
1
Vietnam to Become The New Center of TheGlobal Manufacturing Supply Chain
2
3
14.5 15.8
17.5 19.1
20.4 20.0
2015 2016 2017 2018 2019 2020
Implemented FDI has been resilient despite Covid-19
Increasing immigration and expansion of global leaders into Vietnam
(US$bn) Domestic consumption growth (%)
Public investment expected to continue the elevated trend in 1H21 with accommodative monetary policy
(9.5) (7.2) (5.8) (5.0) (1.1) 2.9 7.6 4.2 5.6 6.7 4.9 7.7 6.6 4.9 4.1 5.1 5.3 6.9
Philippines Thailand Singapore Malaysia Indonesia Vietnam
2020 2021 2022 2.4 3.6 4.0 4.1 5.7 6.8 -4.7 -3.6 -2.1 0.5 0.5 4.4 4.6 8.2 8.8 7.0 3.0 10.6 2020 2021
Vietnam On A Rebound -
The Brightest Spot In SEA’s Economies
9 5.7 2.0 1.4 -0.14 -2.9 -8.4 -10.0 -15.7 -24.4 6.5 1.5 1.4 1.8 4.0 3.7 7.0 10.0 12.0 2020 2021F
Source: Google Mobility Index; CBRE Research, eMarketer (80)% (70)% (60)% (50)% (40)% (30)% (20)% (10)% 0% 10%
Vietnam Hong Kong Korea
Thailand Singapore
Mobility is gradually returning to pre-Covid levels Daily Community Cases In Vietnam Comparison of Social Distancing Measures
Country First wave of infections (1H20) Subseqeuent wave of infections (2H20) Areas Imposed VN Nationwide (1 - 22 Apr) (100% of GDP) Da Nang (28 Jul – 25 Aug) (1% of GDP) ID
Jakarta, wets Java, Gorontalo and West
Sumatra (Apr to early Jun)
(33% of GDP) Jakarta (14 Sep to 11 Oct) (18% of GDP) MY Nationwide (18 Mar - 3 May) (100% of GDP)
Varying timeframes for different states (mid-Dec: 50% of GDP; mid-Nov: 84%, mid-Oct; 50%) PH Nationwide (16 Mar - 31 May) (100% of GDP)
Manila and adjacent provinces (4 – 18 Aug) (45% of GDP) 0 6 12 18 24 30 36 42 48
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1stwave: 141 cases 2ndwave: 527 cases Dec 1, three new cases in HCMC, all F1 and F2 were confirmed negative Mobility level pre Covid-19
Index
Whilst Retail Sales Across The Region Start to Recover in 2021, Vietnam Proves Its Leading Position With Early and Sustainable Growth
Rental Outlook In Vietnam Remains Stable And Not Experienced A Decrease in Rental Rates
Nominal retail sales change YoY (%)
Solid Retail Leasing Enquiry Growth Expected
16,200 10,718 31,600 67,862 HCMC Hanoi 2020 2021F +95%
% change in rental rate forecast (YoY) Sqm NLA
+533% -60% -50% -40% -30% -20% -10% 0% 10% 2020 2021F 2019 - 2021 Cumulative
Clearer Signs Of A Speedy Recovery; Ready For A “New Normal”
10
Huge Potential For Further Expansion In Vietnam’s Retail Space
Low and fast growing disposable income per capita compared to neighboring countries, coupled with low
mall NLA, presents an opportunity to enlarge Vietnam’s retail mall space to close the regional gap.
Modern Retail is still at a Nascent Stage…
…With the Growing Middle Class Set to Drive
Next Wave of Consumption
Disposable income per capita (US$)
Vietnam’s Disposable Income per Capita is similar to Philippines in 2004 and Thailand in 1990, implying huge growth potential (1)
Source: EIU, Colliers, CBRE Research (Hanoi and HCMC Market Insights 2020)
10
2
Vietnam has a Low Mall NLA compared to Thailand and Philippines(1)
NLA (mm sqm)
Strong supply which validates the market’s potential, backed by stable rental rate(2)
Note: (1) Includes NLA pipeline 2020-2021 (2) As of 31 Dec 2020
Future Supply (sqm NLA)
Hanoi HCMC 950 1,018 1,808 2,554 2,796 2017 2018 2019 2023 2024 930 2,824 3,547 3,818 2004 2019 2023 2024 999 6,221 6,902 7,246 1990 2019 2023 2024
Vietnam
Philippines
Thailand
2.5 7.9 7.3Hanoi/ HCMC Bangkok Metro Manila
2.9x
3.2x
2.9x
Rental rate (USD/sqm/month)
Rent rate (CBD) Rent rate (Non CBD) 30.0 60.0 90.0 120.0 150.0 1Q20 2Q20 3Q20 4Q20 30.0 60.0 90.0 120.0 150.0 1Q20 2Q20 3Q20 4Q20 1,054 1,054 1,127 1,209 73 82 156 2020 2021F 2022F 2023F 1,049 1,049 1,106 1,220 57 114 70 2020 2021F 2022F 2023F Current Future
11 Source: EIU, Euromonitor, Vietnam Investment Review, Inside Retail Asia, CBRE Vietnam
(1) Includes NLA pipeline 2020-2021 (2) % E-commerce penetration represented by internet retailing over retailing.
Modern Retail Set to Take Off
Vietnam is Starved for Modern Retail Format
E-Commerce More Catalyst Than Threat
E-Commerce Penetration(2) 28% 11% 9% 4% 5% 4% 2% 40% 21% 15% 13% 11% 10% 3%
China Indonesia Singapore Philippines Malaysia Thailand Vietnam 2019A 2024E
(%)
Vincom Retail Further Consolidates Leadership
Position
Attractiveness of Modern Retail to Consumers Attractiveness of Modern Retail to Tenants
Modern Retail Format an Attractive Solution in Vietnam
Significantly Underpenetrated Modern Non-Discretionary Retail Remains
Malls: A Key Activity Hub
Providing the Infrastructure
Vincom Retail’s Disruption Has Already Leapfrogged the “Department Store” Phase
Low Penetration vs Peers
Limited alternatives for
entertainment and social activities
One stop platform for discretionary + non-discretionary consumption
Significantly higher footfall and sales psm achieved compared to
unorganized retail
Provides quality control with
guaranteed infrastructure and logistics that helps to build brand equity
Stand-alone Department Store Formats have Lost Out
Lotte Vietnam on losing streak
since operations began
…However, during its ten years of operation in Vietnam, Lotte Mart has never closed a year with profit…
Parkson Vietnam shutters store
…Parkson Vietnam has closed another of its stores as it continues to struggle to make its business profitable…
2
Digital transformation
2020/21(1)NLA per capita (sqm)
Leading the service quality and customer experience
Destination for and a trustworthy partner of major international brands to be present in Vietnam for the first time
Progressively applying digital transformation to enhance customers’ experience via improved service quality
Close and flexible connection between retail malls and e-commerce to support shoppers and tenants via a network of credible e-commerce partners
Utilize the readily available customer base from VinID
0.1 0.2
0.5 0.5 0.5 0.5
1.1
1.4
1.8
HCMC Hanoi Beijing Jakarta Shanghai Manila Singapore Bangkok Kuala Lumpur
12
12
Only Retail Platform With Nationwide Access
Portfolio Leasing Creates Significant Bargaining Power… … and Ability to Attract Best-in-Class Tenant Portfolio, with
more than 1,000 Unique Tenants
(1)Source: Company information as of 31 Dec 2020
(1) Non-controlling interest in a subsidiary of Masan Group which owns MasanConsumerHoldings, the largest manufacturer of consumer products by revenue, and VinCommerce, the largest consumer retail network in terms of number of grocery retail stores
2
CAN THO DONG NAI HCMC DA NANG HANOI HAI PHONGVRE’s dominant position and nationwide scale makes it Vietnam’s “Go-to” platform
for international and established local brands
Vietnam
Fa
shi
on
&
B
eauty
F&
B
and
E
nt
ert
ai
nm
ent
A
nchor
(1) First stores in Vietnam for Zara,H&M First stores in
Hanoi for Uniqlo
First store in retail malls of Decathlon
• 80malls across 43
cities and provinces(1) • 4retail formats for
specific areas
• Proven and scalable retail development platform
13
Metro And Bus Infrastructure To Accelerate Retail Mall Footfall
Under Construction Planned Lines
Metro Lines
With urban metro lines opening for the first time in Ho Chi Minh City and Hanoi and extra coverage of VinBus routes, the shift from street retail to organized retail (malls) will accelerate
Vingroup’s mixed use and VRE’s mall models are suited to tap on this trend, given their targeted positioning and proximity to the stations
2
Most of VRE malls are covered by the upcoming metro lines in Ho Chi Minh City and Hanoi, and major VRE megamalls such as
VMM Ocean Park, Smart City and Grand Park have extra cover of VinBus routes – significant boost in connectivity and footfall
expected
3 1 1 8 2 4 5CBD
Van Dien Ha Dong District Long Bien Distirct Tay Ho District Hoang Mai District Trau Quy Hung Yen ProvinceHanoi
VINCOM MEGA MALL ROYAL CITY 1 2 3
CBD
4 5Ho Chi Minh City
District 9
District 1
Go Vap District
District 2
Tan Phu District District 10
VINCOM CENTER BA TRIEU VINCOM CENTER
TRAN DUY HUNG
VINCOM CENTER PHAM NGOC THACH
Ho Chi Minh City Airport
Preliminary VinBus routes as of 31 Dec 2020
(*) 1 Grand Park - Emart 2 Grand Park – Tan Son Nhat airport3 Grand Park – Sai Gon bus station 4 Grand Park- Mien Dong bus station
6 Hao Nam – Ocean Park 7 My Dinh– Ocean Park 8 Ham Nghi– Ocean Park 9 Interconnected Complex – Ocean Park
1 Long Bien – Tran Phu – Smart City 2 Long Bien – Cau Giay – Smart City 3 Giap Bat – Smart City 4 Ho Tay water park – Smart City 5 VCP Long Bien – Smart City
Noi Bai – Ocean Park Mien Dong bus station – National University NUA
5 10 Bus routes 1 2 3 4 1 2 3 4 5 6 7 8 9 10 VINCOM PLAZA SAIGON RES
VINCOM MEGA MALL THAO DIEN
VINCOM MEGA MALL GRAND PARK
VINCOM PLAZA 3/2
VINCOM CENTER NGUYEN CHI THANH
VINCOM MEGA MALL SMART CITY
VINCOM CENTER DONG KHOI
VINCOM MEGA MALL OCEAN PARK VINCOM MEGA MALL
TIMES CITY
14
14
Multi Format Model Covers A Larger Market Opportunity
Annual Income Distribution (% of population in Vietnam)(1) Target Segment: City Center/ CBD consumers Middle & upper middle income Target Segment: Integrated development catchment area Targets families across all income segments * Focus on shopping – experience based shopping to enhance customer experience Target Segment: Heart of provincial town plus urban non-CBD consumers of key cities Family & activity hub Middle income Target Segment: Regional & non-CBD catchment areas Mass to middle income Lotte Target Segment: Upper middle income
Holistic Segment Coverage Across Formats Competitors
Vincom Center Vincom Mega Mall Vincom Plaza Vincom+
AEON Target Segment: Middle income / Upper middle income
Vincom Retail has access to addressable market segment of over US$176bn
of retail revenue Affluent (6%) Mass (21%) Aspiring (17%) Emerging (32%) Middle Income (24%)
Source: BCG population and wealth models (1) MAC (Middle income and affluent customers)
3
BIG C GO Target Segment: Mass to middle income15
Unique Multi-Format Retail Model
Vincom Center Location: City-center, CBD Retail GFA: 40,000 – 60,000 sqm No. of Malls: 7 Total GFA: 280,026 sqm
Vincom Mega Mall
Location: In integrated, mixed-use projects Retail GFA: 60,000 – 150,000+ sqm No. of Malls: 3 Total GFA: 444,098 sqm Vincom Plaza Location: High-density, CDB of cities ex. Hanoi and HCMC Retail GFA: 10,000 – 40,000 sqm No. of Malls: 54 Total GFA: 857,517 sqm Vincom+ Location: Medium-density, non-CBD Retail GFA: 3,000 – 5,000 sqm No. of Malls: 15 Total GFA: 71,936 sqm (Segmentation by GFA)
Key Cities
43
Cities/
Provinces
80
Operational
Malls
~1.7mm
Retail GFA
(sqm)
Distinguished retail formats and focused on wide range of lifestyle oriented consumers
Prime Urban and High Growth Areas in Key Cities
Note: As at 31 December 2020
4 retail mall formats
Proven and scalable retaildevelopment platform
25.5% 51.7% 4.1% 18.7% Hanoi 11 Vincom Malls 5 Vincom Centers 3 Vincom Mega Malls 3 Vincom PlazasHo Chi Minh City 13 Vincom Malls
2 Vincom Center 1 Vincom Mega Mall 7 Vincom Plazas 3 Vincom+
North Vietnam (ex. Hanoi) 19 Vincom Malls 16 Vincom Plazas 3 Vincom+ Central Vietnam 20 Vincom Malls 13 Vincom Plazas 7 Vincom+
South Vietnam (ex. HCMC) 17 Vincom Malls
15 Vincom Plazas 2 Vincom+
16
16
Ability To Leverage The Best-in-Country Vingroup Ecosystem
Largest Loyalty Programme in
Vietnam Reinforces
Captive Spending
Integrated Developments Provide
Mega Malls with Natural Catchment
Access to Landbank from
Vietnam’s Biggest Developer
c.30 years
worth for
development
pipeline for
Vinhomes
Unparalleled
land sourcing
expertise
Vinhomes’s Landbank Breakdown
mn sqm
Single card,
nationwide access
Benefits lock in
repeat spending
Guaranteed
Footfall for
Malls
Market Leading Retail Brands Form
Immediate Tenant Foundations
Accelerates concept
to completion
Drives consumer
footfall
c.168mm
sqm of
Landbank
(1)Up to
100,000
Residents
(2)28%
NLA leased to
internal and
affiliated tenants
(2)11m
Members
(2) Note:1. Refers to Vinhomes’ landbank 2. As of 31 December 2020
3. Non-controlling interest in a subsidiary of Masan Group which owns MasanConsumerHoldings, the largest manufacturer of consumer products by revenue, and VinCommerce, the largest consumer retail network in terms of number of grocery retail stores
13
155
Launched Pipeline projects
Times City (opened: 4Q2013) Ocean Park (opened 12.2020)
4
(3)17
Institutional Level Corporate Governance
Conflict Area
Description
Control
Decision Making
• Vingroup will continue to be VRE’s majority shareholder following the Offering• All transactions must be entered into on commercially reasonable basis as a statutory requirement.
• Significant related party transactions must be approved by the Board of Directors or the general meeting of shareholders
• Interested parties must abstain from voting
Competition
• Both Vingroup and VRE are in the business of property development• Non-compete from Vingroup on retail; VRE has a clear Right of First Refusal (“ROFR”) for all stand-alone retail projects, retail
components and select mixed-use projects with well-defined criteria
Land Bank Access
• Vingroup holds much larger land bank than VRE• The ROFR above gives VRE economies of scale in land sourcing, and delaying early-stage development costs
• VRE has ROFR on land that can be used for retail, at cost
• VRE has an independent land sourcing team and primarily focuses on different types of projects than Vingroup
Related Party Tenants
• VRE has related party-tenants (Vingroup entities)• Allows VRE to expand faster with the key anchor tenants in place in advance of commencing construction
• Leases are negotiated on an arms’ length commercial terms • Governed by related party rules under “Decision Making”
Management Services
Contracts
• VRE has contracts with Vingroup entities such as Vinpearl and Vinmec for non-core services such as lodging rental and periodic health check for
employees, and Vingroup for headquarters services such as marketing, treasury and corporate HR
• Fees are calculated based on comparable third-party service providers and Vingroup fees are allocated based on number of man hours and assets under management
• Helps VRE to manage expansion with minimum overhead as it can share resources and costs with the rest of Vingroup
• Governed by related party rules
17
5
19 998 930 1,174 1,178 (6.3%) 0.3% VNDbn 1Q20 2Q20 3Q20 Leasing NOI 86.1% 81.1% 91.3% (1) % of 2019 level
All key financial figures continued remarkable momentum from the 3
rdquarter
1,686 1,630 1,449 1,307 1,760 1,608 3,253 1,645 (3.3%) 84.8% (9.8%) 2.3% VNDbn 1Q20 2Q20 3Q20 1Q20 2Q20 3Q20
Total Revenue Leasing Revenue
VNDbn 73.8% 82.2% 79.7% 90.6% 78.8% 88.9% % of 2019 level % of 2019 level 759 646 845 (14.9%) 86.1% 1,572 VNDbn 1Q20 2Q20 3Q20 Gross Profit 78.1% 67.3% 78.4% % of 2019 level 1,068 910 1,218 1,746 (14.8%) 43.3% VNDbn 1Q20 2Q20 3Q20 EBITDA 88.9% 73.1% 94.0% % of 2019 level 4Q20 4Q20 4Q20 4Q20 4Q20 112.7% 86.5% 110.5%
Note: Based on VAS Consolidated Quarterly Financial Statements
These financial metrics already took into account the impact of the rental support (VND300bn in 1Q, VND375bn in 2Q, VND145bn in 3Q and VND46bn in 4Q)
(1) NOI for leasing investment properties and rendering of related services is calculated by taking total income from leasing activities and from other property-related services less any property-related operating expenses which include land lease costs but exclude management expenses allocated from parent company
116.8% 84.3%
Decline 2Q vs. 1Q
Growth 4Q vs. 3Q
Financial Performance – 4Q2020
20
Retail GFA
Occupancy rate
(‘000 sqm)
2019
2020
Change
(%)
Vincom Center
280
280
-Vincom Mega Mall
388
444
14.4
Vincom Plaza
858
858
-Vincom+
72
72
-Total
1,598
1,654
3.5
2019
2020
Change
(ppts)
Vincom Center
91.3%
92.7%
1.4
Vincom Mega Mall
91.7%
86.8%
4.9
Vincom Plaza
88.7%
81.5%
7.2
Vincom+
84.9%
75.2%
9.7
Total
89.8%
84.4%
5.4
Note: As of 31 December 2020
21
1
Footfall
2
Tenants’ sales in 2020
3
(2)
Note: As at 31 December 2020; Company information
(1) (1) (2) 1 2 3 4 5
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Hanoi (2020)
1 2 3 4 5Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
HCMC (2020)
Million Million
Overall, footfall has positively recovered. Hanoi malls saw strong footfall recovery thanks to upgraded VCC Metropolis, VCC Pham Ngoc Thach with more international famous brands driving footfall
Newly opened VMM Ocean Park in December was well received
HCMC malls witnessed weaker recovery than in Hanoi due to travel restriction impact, which lead to fewer foreign tourists
Tenants’ Recovery Post Covid-19
F&B
Fashion
Entertainment
Cinema
COVID-19 relative impact
Recovery status Strong recovery witnessed across Hanoi and HCMC Strong recovery witnessed across Hanoi and HCMC Gradual recovery witnessed across Hanoi and HCMC Gradual recovery witnessed across Hanoi and HCMC Least impacted Least impacted Medium impacted Most impacted
Resumption of business activities & improved tenant sales resulted in less tenant support in 4Q2020. Total support package of 2020
was
VND865bn
(vs. VND 820bn in 9M2020).
22
Occupancy rate: 93%
(including committed tenants)
VCC LANDMARK 81 VCC METROPOLIS VCC TRAN DUY HUNG
VCC PHAM NGOC THACH
Key tenants
Chain tenants expansion
15%
Area
New tenants
of total tenants
%11
Number of new tenants
Accounting for
114
New mall opening – Vincom Mega Mall Ocean Park
Upgrading Operating Malls
Leasing Plan and Tenant Growth
Achievement
On 17 December 2020, Vincom Retail was
honored among the top 10 leading brands
in Vietnam 2020 by Forbes Vietnam
23
Marketing Activities That Drive Footfall And Tenant Sales
Vietnamese Women’s Day
(20 Oct 2020)
Radiant flowers - Happy
fragrance
Black Friday, Christmas
(23 Nov 2020 – 15 Jan 2021)
Welcome festival - Warm
and full of love
Opening Day
(11 Dec 2020)
Christmas Festival in
the Ocean City
(19 December 2020)
Marketing Campaigns
Grand Opening of VMM Ocean Park
The first event ever held at Vincom
-Discover Vincom with beautiful men
Footfall: ~4mn (visits)
Tenant sales: ~VND 548bn
Activities focus on decoration, cheerful events with up to 70% discount
Presence of famous singers and Christmas Music Night
Footfall: ~6mn (visits)
Tenant sales: VND 823bn
Music performance event with the participation of singer Noo Phuoc Thinh
Bus Tour & Roadshow, in cooperation with VinFast, transported internal customers and Vinhomes residents to Vincom
Footfall: ~76.2 thousands (visits)
Tenant sales: ~VND 20bn
The first Christmas night in the Ocean City with a music performance featuring famous singers
Light and fireworks show – first time at Ocean Park urban area
Light up the tallest Christmas tree in Hanoi
Roadshow, in cooperation with VinFast, transported Vinhomes residents
Guide customers to prevent disease at Vincom malls including wearing mask before entering the shopping mall or participating in entertainment activities
Hourly disinfection with hand sanitizer when entering and leaving shopping mall
Viral marketing on Fan pages of the 80 shopping malls and on company website
25
Customer
Services
Continue
to
develop
Vincom
Center
(VCC)/Vincom
Mega
Mall
(VMM)/Vincom Plaza (VCP) in the big and Tier-1 cities to offer a dynamic
and engaging experience to the residential community in Vinhomes’
mega projects and surrounding areas
Enhance customer experience, embrace digital technologies, and
ascertain the number one destination for customers by expanding and
diversifying
tenants’ portfolio with international and Vietnamese brands
Product
Strategy
Marketing
Strategy
Tenant
Strategy
2021 Strategies And Plan
Expand the group of international, large, chain and anchor tenants
(Fashion, F&B, Furniture, Home accessories, Supermarket, etc.) in
existing shopping malls
Pioneer in reaching and bringing international, prestigious brands
and attractive retail models to Vietnam for the first time
Accompany and support Vietnamese tenant groups
Solidify Vincom
Retail’s leading position for effective cooperation and
consumers’ trust
Expand channels for brand communication: Web/App
Provide a safe shopping environment with quality products and services
Optimize operating costs and energy costs
5 new shopping malls
New malls’ occupancy target: VMM 85%,
VCP and VC+ 95% (including committed
tenants)
Upgrade VCP Da Nang to VCC
Upgrade tenant mix at VCC Metropolis
(Hanoi), VCP Phan Van Tri (HCMC), VCP
Hung Vuong (Can Tho)
Digital
Transform-ation
Apply digital transformation initiatives to create a dynamic, engaging
customer experience and maximize operational efficiency
Roll out Tenant Portal
Build data warehouse system
Enhance Vincom web/ Vincom app to
facilitate customer experience to and at
Vincom malls
Implement marketing and communication
plans for the grand openings of major
projects namely Grand World, Vincom
Mega Mall Smart City, and Vincom Mega
Mall Grand Park
Enhance a quality service program to offer
impressive shopping experience for the
continuously increasing end-users and
customers
26
Leading shopping malls
with presence across Vietnam
Shopping malls of Vietnamese
Pioneer in bringing shopping experiences from
prestigious domestic and international brands
New opening
Chain and
anchor
tenants
development
5
projects, including
2
Vincom Mega Mall
2
Vincom Plaza
1
Vincom+
150,000
sqm GFA
Increase nationwide
~1.8mn sqm
retail GFA to
Number of stores
20%
Area
20%
Target tenants for finalizing
Upgrade
tenant mix
3
projects, including
1
Vincom Center
2
Vincom Plaza
Sale Goals And Action Plan
Goals
28
Figures in VND billion 4Q2019 4Q2020 YoY (%) Commentary QoQ (%) Commentary
Leasing of Investment Properties and Rendering of Related Services
1,951 1,645 15.7
An additional VND45.6 billion (US$1.9 million) tenant support package was granted
Revenues from advertising, utilities and car-parking was also lower due to the social distancing period, and overall Covid-19 impact
2.3
Sale of Inventory Properties 785 1,547 97.1
Two major projects (My Tho and Bac Lieu) were handed-over in 4Q2020
1,347.7
Two major projects (My Tho and Bac Lieu) were handed-over in 4Q2020
Other revenue 48 61 27.4 33.5
Total Revenue 2,784 3,253 16.8 84.8
Gross Profit(1)
1,395 1,572 12.7 86.1
Operating Profit / (Loss) 1,096 1,186 8.2 76.3
Profit / (Loss) before Tax 1,109 1,211 9.2 69.0
Profit / (Loss) after Tax for the
Period 884 975 10.3 70.3
Profit / (Loss) after Tax and
Minority Interest 883 974 10.3 70.3
Note: VAS Consolidated Quarterly Financial Statements
(1) Gross profit already subtracted D&A relating to investment properties accounted for under VAS
29
Figures in VND billion 2019 2020 Change (%) Commentary
Leasing of Investment Properties and Rendering of Related Services
7,017 6,008 14.4 In 2020, the Company disbursed VND865 billion to support tenants
affected by the Covid-19 pandemic
Sale of Inventory Properties 2,027 2,149 6.0
Other revenue 215 172 20.0 Entertainment business and operation of Condotel Da Nang were
heavily impacted by Covid-19
Total Revenue 9,259 8,329 10.0
Gross Profit(1) 4,404 3,821 13.2
Operating Profit / (Loss) 3,546 2,901 18.2
Profit / (Loss) before Tax 3,576 2,993 16.3
Profit / (Loss) after Tax for the
Period 2,852 2,382 16.5
Profit / (Loss) after Tax and
Minority Interest 2,851 2,382 16.5
Financial Performance In 2020 vs 2019
Note: VAS Consolidated Quarterly Financial Statements
30 3,089 3,829 4,955 4,280 998 930 1,174 1,178 2017 2018 2019 2020 1Q20 2Q20 3Q20 4Q20 2.342 2.882 3.752 2.951 668 587 838 858 411 806 735 1,034 135 110 49 740 48 (47) (84) (164) (44) (52) (41) (27) 2,801 3,641 4,404 3,821 759 646 845 1,572 2017 2018 2019 2020 1Q20 2Q20 3Q20 4Q20
Leasing of Investment Properties Sale of Inventory Properties Other Revenue
39.6% 48.0% 48.3% 4,455 5,506 7,017 6,008 1,449 1,307 1,608 1,645 951 3,433 2,027 2,149 201 294 107 1,547 112 185 215 172 36 29 46 61 5,518 9,124 9,259 8,329 1,686 1,630 1,760 3,253 2017 2018 2019 2020 1Q20 2Q20 3Q20 4Q20
Leasing of Investment Properties Sale of Inventory Properties Other Revenue
Note: Based on VAS Audited Consolidated Financial Statements for respective years and VAS Consolidated Quarterly Financial Statements of 2020
(1) Depreciation and amortization relating to investment properties is below the graph and should be added back (to Gross Profit) under IFRS. Since 2018, “Other” segment includes results from management of Da Nang condotels which was incurring loss as the property was still ramping up after launch in May 2018.
(2) NOI for leasing investment properties and rendering of related services is calculated by taking total income from leasing activities and from other property-related services less any property-related operating expenses which include land lease costs but exclude management expenses allocated from parent company.
VNDbn
Total Revenue
Gross Profit
VNDbn
50.8% 39.9% 47.6%
Gross Profit Margin (%)
Leasing Net Operating Income (NOI)
Profit After Tax and Minority Interest
VNDbn VNDbn
Leasing NOI Margin (%)
69.3% 69.5% 70.6%
(2)
(1)
45.0%
69.2% 73.2% 71.9%
Depreciation & amortization of investment properties (VNDbn)
45.9% 829 1.042 1.331 1.359 339 335 346 338 1,905 2,404 2,851 2,382 492 343 572 974 2017 2018 2019 2020 1Q20 2Q20 3Q20 4Q20 71.0% 71.3%
Financial Performance
31 VNDbn
Total Assets
Total Borrowings, Cash and Cash Equivalents
Total Equity
(Net Debt / (Net Cash))
(3)/ Equity
VNDbn VNDbn VNDbn 21,481 27,773 28,718 28,558 16,652 10,911 7,121 11,212 38,133 38,684 35,839 39,769
31-Dec-17 31-Dec-18 31-Dec-19 31-Dec-20
Investment Properties and Investment Properties Under Construction Other Assets
5,974 2,780 2,785 5,726 4,095 3,133 2,177 4,945
31-Dec-17 31-Dec-18 31-Dec-19 31-Dec-20
Total Borrowings Cash and Cash Equivalents
26,094
28,509
26,954 29,336
31-Dec-17 31-Dec-18 31-Dec-19 31-Dec-20
7.2%
Net cash
2.3% 2.7%
31-Dec-17 31-Dec-18 31-Dec-19 31-Dec-20
(2) (2)
(2)
(2) (1)
Note: Based on VAS Audited Consolidated Financial Statements for respective years and VAS Consolidated Financial Statements for 4Q2020
(1) Investment Properties and Investment Properties Under Construction (IP/IPUC) are valued at development cost minus depreciation and amortization and are not fair valued
(2) Decline in other assets, cash and cash equivalents, total equity as well as increase in gearing ratio as of 31 December 2019 was due to the payment of cash dividends of VND 2,445bn in April 2019 and buy back 56.5 mil treasury shares completed in November 2019
(3) Net Debt / (Cash) = (Short-term Borrowings + Long-term Borrowings) – (Cash & Cash Equivalents + ST Investments).
Balance Sheet
33
Bridging VAS To IFRS
Unit: VND Billion
VAS
2020
Adj.
IFRS
2020
Commentary on Adjustments
Leasing revenue and other related
services
6,008
51
6,059
Realized unearned revenue of deposit from customer in relation
to amortization of deposit
Sale of inventory properties
2,149
2,149
Other revenue
172
172
Total revenue
8,329
51
8,380
Cost of leasing activities and other
related services
(3,057)
1,283
(1,774)
Mostly depreciation of malls included in VAS; excluded under
IFRS
Cost of inventory properties sold
(1,115)
(1,115)
Others
(336)
(336)
Cost of goods & services
(4,508)
1,283
(3,225)
Gross profit
3,821
1,334
5,155
Gain/loss from recording FV of IP/IPUC
1,204
1,204
Fair valuations of the investment properties and investment
properties under construction (“IP/IPUCs”) are based on valuation
reports by independent valuers as of 30 June 2020
Selling expenses
(330)
(330)
General and administrative expenses
(399)
73
(326)
Amortization of Goodwill included in VAS; excluded under IFRS
Other income
124
124
Other expense
(32)
(32)
Finance expense
(467)
(108)
(575)
Amortization of deposit from customer
Finance income
276
65
341
Revert capitalized interest income to IPUC
Profit before tax
2,993
2,567
5,560
Tax expense
(610)
(241)
(851)
Mainly deferred tax arising from fair value adjustment of IP/IPUC
34 Source: Vietnam Ministry of Health; Company information
As of 31 December 2020 0 100 200 300 400 500 600 700 800 900 0 6 12 18 24 30 36 42 48
Community cases (LHS) Vincom Retail Footfall (RHS)
(‘000) 26 Jul: First community case in Da Nang after 99 days of no new cases in Vietnam Only 3 community cases since 3 Sep. All F1 and F2 were confirmed negative
VCP Buon Me Thuot closed for 2 weeks
from 3 to 17 Aug
VCP Da Nang closed for 5 weeks from 28 Jul to 5 Sep
1stwave of Covid-19 (5 Mar – 30 Apr) 2stwave of Covid-19 (28 Jul – 20 Sep)
