Gia-Lai-Electricity-Joint-Stock-Company
Total Page:16
File Type:pdf, Size:1020Kb
2018 ANNUAL REPORT ABBREVIATIONS AGM : Annual General Meeting BOD : Board Of Directors BOM : Board Of Management CAGR : Compounded Annual Growth Rate CEO : Chief Executive Officer COD : Commercial Operation Date CG : Corporate Governance CIT : Corporate Income Tax COGS : Cost Of Goods Sold EBIT : Earnings Before Interest and Taxes EBITDA : Earnings Before Interest, Taxes, Depreciation And Amortization EGM : Extraordinary General Meeting EHSS : Enviroment - Health - Social Policy - Safety EPC : Engineering Procurement and Construction EVN : Viet Nam Electricity FiT : Feed In Tariff FS : Financial Statement GEC : Gia Lai Electricity Joint Stock Company HR : Human Resources JSC : Joint Stock Company LNG : Liquefied Natural Gas M&A : Mergers and Acquisitions MOIT : Ministry Of Industry and Trade NPAT : Net Profit After Taxes SG&A : Selling, General And Administration PATMI : Profit After Tax and Minority Interests PBT : Profit Before Tax PPA : Power Purchase Agreement R&D : Research and Development ROAA : Return On Average Assets ROAE : Return On Average Equity YOY : Year On Year GEC's Head Office 2 2018 ANNUAL REPORT www.geccom.vn 3 TABLE OF CONTENTS CÔNG TY CP ĐIN GIA LAI 02 ABBREVIATIONS 04 TABLE OF CONTENTS 06 REMARKABLE FIGURES 10 COMMITMENTS AND RESPONSIBILITIES 12 Vision - Mission - Core value 13 17 sustainable development goals of United Nations 18 Commitments to the truth and fairness the 2018 Annual Report 20 Interview with Chairman of the Board 24 Profile of the Board of Directors 28 Letter to Shareholders from the CEO 32 Profile of the Board of Management 36 Financial highlights of 2015-2018 40 CORPORATE GOVERNNANCE PROMOTING INVESTMENT 42 Applying ASEAN Corporate Governance Scorecard - STRENGTHENING DEVELOPMENT Efforts towards new standards 56 Code of Conducts 58 Board of Directors’ Reports and Corporate Governance activities 72 Renewable Energy trend - A view from Southeast Asia and Vietnam 84 Board of Directors’ Strategic vision 90 Report of the Independent Board Member 92 Report of the Audit Committee 96 Main risks and risk management activities 104 Compliance with Vietnam Laws, approaching international standards 110 Investor relations and Capital market activities 122 BOARD OF MANAGEMENT - YEAR IN REVIEW 124 Remarkable milestones in a year of operation 130 Project portfolio & Services 138 Positioning GEC on the Renewable Energy market 146 Business activities analysis based on Business Model 158 Investment, operation and production activities of each major Energy Segment 164 R&D activities - Optimal Energy solutions 166 Investment in technology development to increase the operation efficiency 170 Human resource and training - Lever of growth 182 SUBSTAINABLE DEVELOPMENT 184 Stakeholders engagement 190 Commitment on economic - Sustainable economic growth Started as an equitized State - Owned Enterprise, focusing 200 Commitment on environment - Sustainability from the ecosystem only on small and medium Hydroelectricity, GEC has now 206 Commitment on the community - Community and society engagement kept abreast of Renewable Energy trends with its Solar, Wind 214 Sharing from Foreign Shareholders projects, etc. With determined strategic direction from the 215 Sharing from Contractors leadership and the enthusiastic support from international 216 Sharing from Customers 218 Sharing from Employees Shareholders - IFC and Armstrong, GEC is making solid steps in 220 Contact Information for Stakeholders dynamic Renewable Energy in Vietnam, ensuring compliance with the highest environmental and social standards. 222 VIEW ON FINANCE 224 Summary on 2018 Audited Separate Financial Statements 229 2018 Audited Consolidated Financial Statements 286 MILESTONES OF DEVELOPMENT - WHO WE ARE 4 2018 ANNUAL REPORT www.geccom.vn 5 REMARKABLE FIGURES IN 2018 HYDRO, SOLAR, WIND POWER NO.1 100% SOLAR POWER Pioneer in Vietnam Market share ~ 50,000 Tons/year Reduction of CO2 emissions 395 MW ~ 22 plants VND 350 By 2020 billion/year Revenue ~ VND 7,400 billion 818 ~ Total investment cost VND MWp 9,000 of 8 plants billion ~ 17 plants VND by 2022 Total investment cost 7,400 billion of 22 plants Investment in economically-difficult areas ~ 355,000 ~ VND Solar panels 44 ~ billion 163 Investment in technology Million kWh/year Commercial electricity ~ 310 Million tons 440 Ha Reduction of CO2 emissions 1,136 61% MW Total land area of By 2022 Gross Profit Margin 8 plants 392 MWp 117 In-operation MWp before 2020 National grid connection 6 2018 ANNUAL REPORT www.geccom.vn 7 REMARKABLE FIGURES IN 2018 MEDIUM AND SMALL - SCALE HYDROPOWER PLANTS BUSINESS PERFORMANCE & CORPORATE GOVERNANCE VND 559 billion ~ 12,800 Net Revenue ~ 84.1 356 Beneficiaries MW Million kWh 14 plants Commercial electricity VND 207 billion ~ Profit Before Tax 35% Shares 24% IFC, ARMSTRONG Gia Lai 60% Market share 2018 Gross Profit Margin 35% 18% Increase of Market price of Hue GEG share 2018/2017 Market share VND 7+ billion IFC Social, Community activities Governance 14% Advisor Lam Dong Market share PWC Independent Auditors 8 2018 ANNUAL REPORT www.geccom.vn 9 14 Nhà máy Thủy điện 14 Nhà máy Ayun Ha Hydropower Plant - Gia Lai COMMITMENTS AND RESPONSIBILITIES SOLID INTEGRATION 12 Vision - Mission - Core value 13 17 sustainable development goals of United Nations CONTRIBUTING TO THE FUTURE 18 Commitments to the truth and fairness the 2018 Annual Report 20 Interview with Chairman of the Board STARTING FROM SMALL HYDROPOWER PLANTS, AFTER 30 YEARS 24 Profile of the Board of Directors OF ENERGIZING FROM THE CENTRAL HIGHLANDS, GEC CONSTANTLY 28 Letter to Shareholders from the CEO DEVELOPING, INTEGRATING INTERNATIONALLY, WITH MULTILATERAL 32 Profile of the Board of Management 36 Financial highlights of 2015-2018 COOPERATION, FOCUSING ON INVESTMENT IN RENEWABLE ENERGY SOURCES, GETTING READY FOR CONTRIBUTION TO 01 THE FUTURE JOURNEY. SUSTAINABLE VISION - MISSION - CORE VALUE DEVELOPMENT GOALS 17 OF THE UNITED NATIONS By 2025, GEC becomes the leading private organization in VISION Vietnam’s Renewable Energy sector. To optimize the resources of Hydro, Solar, Wind and Biomass. MISSION To meet the Energy demand by clean Energy solutions, to serve the community and to protect the social environment. GEC pioneers in developing sustainable Renewable Energy 17 MỤC TIÊU sources, meeting the Energy demand in all weather conditions, CORE providing a wide range of Energy types connecting to PHÁT TRIỂN BỀN VỮNG CỦA LIÊN HỢP QUỐC VALUE the national grid, and optimizing Energy solution with BASED ON 17 SUSTAINABLE DEVELOPMENT GOALS investment efficiency - quality of execution - and a commitment OF UNITED NATIONS, GEC HAS ANALYZED AND of “Trust - Responsibility”. SELECTED THE OBJECTIVES TO BE INCLUDED IN THE SUSTAINABLE DEVELOPMENT ORIENTATION UNTIL 2020 SLOGAN SYNCHRONOUSLY DEVELOPING DIFFERENT TYPES OF ENERGY 12 2018 ANNUAL REPORT www.geccom.vn 13 6. CLEAN WATER AND SANITATION - 100% VND 120 Monitoring and supervising of the plants million water quality for each plant 17 SUSTAINABLE DEVELOPMENT 14 4 GOALS OF THE UNITED NATIONS Hydropower plants Times/year 2 Environmental management Solar power Plants system meets the requirements by Law 100% Water purifier, to ensure of the plants water quality meets sanitation standard for the employees VND 1.7 VND 30 billion million 1. NO POVERTY 190 349 Beneficiaries Supporting the campaigns Power supply for remote Beneficiaries VND 3.2 for the poor in Gia Lai, Binh Million18 kWh areas in Chu Prong District billion Thuan and Long An 7,300 7. AFFORDABLE AND CLEAN ENERGY Beneficiaries 2. ZERO HUNGER 14 small and medium Reducing CO emissions Hydropower plants 2 84.1 operating 50,000 Supporting production Supporting and donating MW Tons of CO2 VND 780 development, diversifying VND 1.6 to disadvantaged areas in million livelihoods for local people billion Gia Lai, Binh Thuan and Power generation Long An VND 1,522 Total investment cost 163 billion Million kWh/year 3. GOOD HEALTH AND WELL-BEING Vietnam’s pioneer in Annual Solar Revenue NO. 1 Solar power VND 348 billion 349 Health care and insurance are 119 Beneficiaries provided to employees Beneficiaries 2 in-operation Solar power 6 under-development Periodical health examination Labor safety training for 117 Plants 275 Solar power Plants 2 Supporting for treatment costs VND employees MWp MWp VND 14.6 Blood donation / Leisure trips 60 billion million VND 2,137 Total investment cost VND 5,276 Total investment cost 2 billion Times/year billion 4. QUALITY EDUCATION Solar panels Total investment cost of VND 354,660 8,922 22 plants 450 39 Training programs to billion Beneficiaries Training courses develop successors, internal training, outsourced training 8. DECENT WORK AND ECONOMIC GROWTH 2 VND 1.4 Net Revenue in 2018 Average income of billion VND 559 VND 14 employees billion million/month 5. GENDER EQUALITY Direct and indirect jobs Ensuring gender equality in promotion, successor training for management positions VND 207 Profit After Tax in 2018 5,442 16% Benefits and policies for women, pregnant women, and women raising children under billion Female employees 12 months old Workers CAGR of Revenue CAGR of Profit 23% Middle and senior manager 16% 12% Female middle Female CEO and senior level employees 14 2018 ANNUAL REPORT www.geccom.vn 15 17 SUSTAINABLE DEVELOPMENT GOALS OF 13. CLIMATE ACTION THE UNITED NATIONS (continued) 14 Improving productivity to 2/8 Using Renewable Energy - Hydropower increase Energy-use efficiency In-operation Solar power, not fossil fuels 9. INDUSTRY, INNOVATION AND INFRASTRUCTURE plants Solar power