News Jan 06, 2019

Traphaco reviews the year 2018 and initialize the Plan of 2019

In 2018, Traphaco has completed many tasks to prepare for future development. Plan long-term strategies, specifically each short-term development stage, assess objectively, frankly and in detail each achieved or uncompleted strategic target from which to make quickly and flexible adjustment for next steps ... are what Traphaco applying in the sustainable development strategy for the period 2017-2020.

In general, 10 big pharmaceutical companies listed on the stock market did not record revenue and profit growth over the same period. Also in this year, the Company had an important change in personnel with 3 members of the Board of Directors and 1 member of the Board of Supervisor to resign and be replaced with other members from new shareholder groups. The project of western medicine plant has been put into stable operation, but along with the pressure from depreciation expenses and financial expenses, it is necessary to enhance the optimization capacity of the plant. However, in the development trend, the steady preparation of long-term dynamics growth is extremely necessary.

2018 is the year that Traphaco has basically completed its internal targets. Better governance and strategic implementation have created a fundamental change as a launching platform for Traphaco to realize the sustainable development strategy for the period 2017-2020. This strategy was approved by the 2017 General Meeting of Shareholders with the goal of making Traphaco become the No.1 pharmaceutical company in Vietnam in terms of growth of revenue-profit-and-market-capitalization. The Strategy Deployment Committee set out specific requirements. Including: Change in assignment method and evaluation of effectiveness according to principles, Assigning jobs in accordance with functions and tasks of divisions/units/individuals; Evaluate division/individual effectiveness based on common criteria, create a professional, transparent and trustworthy working environment, KPI results associated with workers' rights.

In Q4, focus on innovating the way of assigning jobs to sale sector. Middle-level managerial personnel, in addition to assigning and evaluating the effectiveness of work, should guide, urge and encourage their staffs to complete their tasks. Especially leaders of sale divisions must guide employees to implement sales policies, implement monthly sales programs, convey the Company's message to each client, show them the benefits if well applied Traphaco's sales policy.

Supplement, adjust salary regulation, attach KPI results with salary to motivate employees. There are regulations on rewarding, honoring outstanding individuals, regulation on priority for recruiting collaborators, ... to increase work motivation. The Company also signed a strategic consulting contract on the Southern market development with Ernst & Young Vietnam Co., Ltd., one of the leading consulting firms.

In 2018, the uncompleted targets were mostly in the financial aspect, as the basic revenue targets were not met which resulted in the failed target on thevalue of manufactured goods at factories; profit target is not achieved due to large depreciation costs and significant increase of financial expenses. Also in this year, due to the adjustment of income tax policies, the increase of social insurance contribution together with some subjective reasons mentioned above led to a decrease in average income of employees compared to the same period in 2017. However, the income of company employees is still at high level compared to other units in the industry as well as the whole market.

The criteria of clients are mostly reached and exceeded the requirements. The target of service quality in the first and second quarter has not yet reached but thanks to the timely adjustment of sales policies and implementation instructions, the third quarter is expected to achieve these targets.

Regarding the goal of upgrading Traphaco's brand to be at regional level, the Company has now selected Nielsen as partner, signed a research contract on brand health, completed in late September, confirmed the Company's brand to be firmly in position No.1 of the pharmaceutical industry as well as pointing out tasks to be fulfilled in the coming time to further promote this strength.

The targets of internal processes, the development of a synchronous proactive distribution system, sales teams, organizational reforms, and learning and development indicators have been implemented and achieved positive results.

2018 is a successful year of new products, implemented in accordance with the roadmap of diversification of concentric product; Complete new product sales exceeding 2 months ahead of the schedule. In addition, sales of green health products and product groups with sales of over VND 100 billion are targets that need more effort to complete.

The Company also invested boldly in research and development when signing bio-equivalence research contracts, signing cooperation with prestigious universities and institutes such as Hanoi University of Pharmacy.

TraphacoSapa also obtained GMP-WHO certification on medicinal production, completing and upgrading the green value chain of Traphaco.

Considered as one of the competitive strengths of Traphaco, the distribution system is always expanded and consolidated. The Company has invested in establishing 04 branches, bringing the total to 28 branches with 27,500 drugstores nationwide. Establishing a hospital sales division to promote hospital sales channel according to Company's Strategy. Assigning work associated with the task and evaluating the KPIs associated with the benefits of sale representatives.

In 2018, the Company completed a huge workload, achieved important results, was recognized by the State and society, firmly prepared for future development steps. Traphaco will realize the targets of 2019, to gradually achieve the objectives under the Traphaco Sustainable Development Strategy for the period of 2017-2020 with the following main criteria:

Consolidated revenue (without VAT) VND 2,160 billion,

Of which: Manufactured products VND 1,800 billion,

Exclusively imported goods: VND 100 billion,

Revenue from subsidiaries VND 260 billion,

-Consolidated profit after tax VND 228 billion,

-Profit after tax of the parent company VND 180 billion,

In 2019, the CEO Tran Tuc Ma issues the message of the year: "Professional governance - Cost optimization - Value synergy - Targets Actualization". The background and experience accumulated in 2018 will be the motivation for Traphaco to implement in 2019 with a step forward to make a breakthrough.

Award and prizes in 2018

• Top 10 Vietnam Golden Stars in 2018

• 2018 National Brand

• Top 10 Sustainable Development Businesses in 2018 - Vietnam Sustainable Development Enterprises Council.

• The most prestigious company in Vietnam Pharmaceutical industry 2017 voted by VietNam Report

• Top 50 best listed companies in Vietnam by Forbes.

• Enterprise for Employee in 2018.

• Top 50 businesses with the best working environment in Vietnam.

• Thang Long Cup (praising the typical enterprise of Hanoi capital in 2018) - Hanoi city Authority - Hanoi People's Council- Hanoi People's Committee - the Vietnam Fatherland Front Committee of Hanoi.

• Emulation flag of Hanoi City.