VIETNAM MARITIME UNIVERSITY INTERNATIONAL SCHOOL OF EDUCATION FIELD TRIP REPORT VICONSHIP Student Name: DO THI THAO TAM Student ID: 55377 Class: IBL0402 Place: VIETNAM CONTAINER SHIPPING CORPORATION HAI PHONG – 2016 VIETNAM MARITIME UNIVERSITY INTERNATIONAL SCHOOL OF EDUCATION STUDENT NAME: DO THI THAO TAM CLASS: IBL0403 FIELD TRIP REPORT VICONSHIP Division: International Business and Logistic Faculty: International School of Education HAI PHONG – 2016 Green Port Fieldtrip Report CONTENTS Do Thi Thao Tam – IBL0402 Page Green Port Fieldtrip Report LIST OF FIGURE Do Thi Thao Tam – IBL0402 Page Green Port Fieldtrip Report LIST OF TABLE Do Thi Thao Tam – IBL0402 Page Green Port Fieldtrip Report LIST OF ABBREVIATIONS CFS: Container Freight Station DWT: Deadweight tonnage TEU: Twenty-foot Equivalent Units PTSC: Petroleum Technical Service Company CAGR: Compound Annual Growth Rate ROE: Return on Equity ROA: Return on Assets Do Thi Thao Tam – IBL0402 Page Green Port Fieldtrip Report PREFACE Vietnam's economy is gradually stabilizing and gradually growing Meanwhile the economy of the world and other countries in the region has developed rapidly To be able to keep pace with the development of the world, our country must focus on development in the field of foreign trade and foreign investment to improve living standards for the people However, to grow in the field of foreign trade or foreign investment, first of all, the transport sector must to meet the timely needs of the economy Moreover, our country located in the economic area has developed rapidly and transportation system is development relatively perfect, therefore, having a huge impact on the transportation industry in Vietnam Besides, our country has favorable natural conditions as the country stretches adjacent to the East Sea, so, it has much larger port as Saigon - Haiphong - Da Nang That is development potential shipping industry and the government is trying to exploit that advantage to focus on strengthening the development of a network of marine transport to be able to keep up with other countries, so that applying container transport modes in Vietnam is an inevitable demand by its uniformity on the world market VICONSHIP is one of best the shipping agents and freight container port system, storage The field at Greenport and CFS warehouse (VICONSHIP) helps me to understand background knowledge of this field At the same point, the internships play an important role, because it provides real knowledge as well as experiences of people working in the subject in many years Do Thi Thao Tam - IBL0402 Page Green Port Fieldtrip Report CHAPTER 1: INTRODUCTION OF THE VIETNAM CONTAINER SHIPPING CORPORATION 1.1 Overviews CONTAINER CORPORATION VIETNAM (VICONSHIP) is one of the shipping agents firms and transport official flagship operation since 1985 VICONSHIP has container port, warehouse, own fleet of vehicles system to server normal cargo transportation service and containerized cargo at North, Central, South, Provide adequate means of transport for all modes of cargo services, to build relationships between the sender mounts, recipients and boss Motto of the company is "always try our best to solve all the problems related to the transportation of goods by the customer." The shipper, consignee and the multimodal transport operator knows VICONSHIP as a transport business reliable and respected over many years 1.2 Brief history Based on VICONSHIP’s official website, we have: - 1985: 07.27.1985 the company was founded, originally named "Vietnam Container Company” - 1992: Opening a branch in Ho Chi Minh City, then separated and became independent companies under VINALINES (VICONSHIP Saigon), Vietnam Container Company renamed "North Container Vietnam Company" (VICONSHIP Haiphong) - 1995: Established a Joint Venture Company with Japanese Companies (Kanematsu Corp - Honda Trading Corp - Suzue Corp - Meiko Trans Corp Kamigumi Corp.) “Vietnam - Japan Transport Company Ltd." (VIJACO) - 1996: At April, established a subsidiary company in Haiphong "International Freight Forwarder and Container Service" - 1997: A new branch in Ho Chi Minh City has been re-established with name "VICONSHIP Ho Chi Minh" Do Thi Thao Tam - IBL0402 Page Green Port Fieldtrip Report - 2000: Established a subsidiary company in Danang "Central Container Shipping Co Ltd." - 2001: Established a subsidiary company in Ho Chi Minh City "MSC Agencies (VN) Co Ltd." - 2002: In April, Haiphong VICONSHIP has been privatized and become a joint stock company under the name "Vietnam Container Shipping Joint Stock Company" - 2004: Established of subsidiaries in Ho Chi Minh "MSC Agency Company” - 2004: In March, established "TSL Co, Ltd" - 2004: In September Green Port (Port of VICONSHIP) is operated - 2006: In March Green Port Berth No.2 is opened - 2006: In August, established "Green Global Transport Co, Lt" - 2007: On December, renamed "International Freight Forwarder and Container Service" to "Green Star Maritime Transport Co., Ltd.” - 2008: In January listed on Hochiminh stock exchange - 2008: On February, Barge berth with 51.5 meter length beside berth no and no is opened - 2009: Contribute money to "Vietnam Future Logistics Joint stock company" - 2009: Established a new branch in Quang Ninh province - 2012: On September, Established Green Depot one member company limited - 2012: On November, give Green Logistics Centre (8.6 hectares) in Dinh Vu Industrial Zone into operation Do Thi Thao Tam - IBL0402 Page 10 Green Port Fieldtrip Report CHAPTER 2: DESCRIPTION OF BUSINESS ACTIVITIES OF VICONSHIP 2.1 Business activities VICONSHIP is one of Vietnam leading companies in freight and port services with the revenue structure including port services accounted for 60% (including loading and unloading and storage) and transportation accounted for 40% (with vehicle fleet consists of 110 container vehicles) VSC is currently operating Green Port in Haiphong with pier of 340m long, 8.0m deep and swivel crane, reaching 70% of maximum capacity with 10-12 ships/ week (about 100,000-120,000 tons) VSC is also the first unit operation in the field of transport of goods by container, providing warehousing services and road transport in Haiphong, Da Nang and Ho Chi Minh City Currently, besides the initially traditional activity is shipping containers, the company also provides many other services to create a closed chain services, not only to bring the benefits of each service separately but also bring mutual benefits, multi utility for customers Currently, the company has a number of major business activities as follows: - International Port Business - Container Terminal Operation - CFS – Warehousing - Shipping agency, marine brokerage - Stevedoring - Inland transportation Do Thi Thao Tam - IBL0402 Page 15 Green Port Fieldtrip Report 2.1.1 International Port Business Green port is a small port enterprise of VICONSHIP Greenport is located at the North latitude 20°51, 106°43 east longitude, from buoy No.0 is 20 knots (near Chua Ve, Cam River downstream) GREEN PORT total length piers is 371 m (including two bridge piers and barges 1) with a waterlines depth is about meters, which can receive two ships 10,000 DWT dock at the same time, ensure safety , fast, convenient It has two berths that are each 160 meters long and can accommodate vessels up to 20,000 Berth No was put into operation in September 2004 and No is operated from January 3/2006 May 01 2008 added barges to operate Some notable shippers of the company are OOCL, Evergreen, MSC and Dongyoung From 2009 to 2014, the container throughput via Green Port increased from 319,000 TEUs to 360,000 TEUs in 2014, representing a CAGR of 2.4 percent During this time, the container throughput peaked in 2011 and then dropped significantly in 2012 In 2013 and 2014, the container throughput stayed at 360,000 TEUs, which is considered to be a full utilization rate of this port As such, the company had to transfer a part of its goods to PTSC Dinh Vu Port Besides, on the wharves are arranged 03 cranes branded Kranbau and Liebherr, with lifting weights 40 tons, reach 32m, loading capacity from 20 to 25 Container / crane / hour Annually, Green Port activities bring revenue and profits significantly for business operations of the company Do Thi Thao Tam - IBL0402 Page 16 Green Port Fieldtrip Report FIGURE : Green Port (Source: Internet) 2.1.2 Container Terminal Operation Currently, in Haiphong, VICONSHIP has invested and is exploring the containers area has a total area of 400000 m2, the equivalent capacity of about 4,000 TEUs This is the area that has been recognized as places clearance by Customs Department since 1995 This is the important legal framework, creating favorable conditions for all exports and imports to keep goods Container yards is an item located in the port, these activities contribute to a closed service chain According to statistics from the company has made time container yard serves more than 200 import and export shippers regularly to receive or transfer goods VICONSHIP’s Container yard (with an area of nearly 400,000 m2) has packaging lines and modern cargo handling, professional management methods, terrain safety licensed clearance by the government of Vietnam VICONSHIP’s Container yard manages most major shipping lines operating in Vietnam With years of experience in mining warehousing services, VICONSHIP undertake handling and Do Thi Thao Tam - IBL0402 Page 17 Green Port Fieldtrip Report storing all kinds of container, steel, equipment and petroleum chemicals, transport equipment slowly arrival storage and vice versa Company also applied achievement of technology in managing container Concretely, VICONSHIP installed CMS (container management system) in managing container It is multi-utility software, help to more conveniently and quickly in managing container, then contribute meeting maximum the demand of customers FIGURE : GREEN Port Container Yard (source: www.viconship.com) 2.1.3 CFS – Warehousing With a wider system about more than 5,000 m² of CFS in Chua Ve port was built and equipped with modern systems from vehicles, software, security camera systems, fire protection system, all warehouses were standard to store imported, exported goods and is planned for each individual repository Customs clearance procedures, Do Thi Thao Tam - IBL0402 Page 18 Green Port Fieldtrip Report exports and imports have been made at this warehouse area VICONSHIP is usually ready to meet all the needs of customers in warehousing, transportation and distribution of goods through the national transportation system Warehousing system of VICONSHIP port placed under the direct supervision of the Customs gate areas (Haiphong Customs), with its headquarters located at the VICONSHIP’s terminal Therefore the completion of customs clearance procedures import and export for customers very quickly, favourably Revenue from warehouse and yard operations annually account for about 17-29% of total revenue and 17-23% of the profits of the company To provide warehousing service and import, export packing required by all customers domestic and foreign Our services include arranging and packing in and out on the kinds of containers Ensure safety of goods with many different categories The process of receiving, packing exporting LCL merchandize to containers of VCS: Receive the procedures and forward; Storage and Preservation; Complete the procedures to pack merchandize; supervise and pack merchandize to container; Report and settlement The process of receiving, distribution and delivery the merchandize of VCS: Receive the procedures; Forwarding the merchandize in the warehouse; Open the container, check the distribution according to the manifest; Receive and forward the merchandize; Report Do Thi Thao Tam - IBL0402 Page 19 Green Port Fieldtrip Report FIGURE : CFS Warehouse of VICONSHIP (Source: www.viconship.com) 2.1.4 Shipping agency, marine brokerage Currently, VICONSHIP is general agent for the world's major shipping lines such as: MSC (Switzerland), TS Lines (Taiwan) and there is a contractual relationship with almost all the other lines have been in Vietnam Agent system is organized in a full mesh network for the region North, Central, South The main activities are carried out mainly reserved goods, management of goods, equipment, containers and import, export deliveries to carriers be entrusted This activity has been closely linked with the operation of the warehouse, loading and unloading activities, transport so the quality of service to shipping lines and customers are active and connected closely services, there are condition reduce service costs for many domestic and foreign customers trust and use more service VICONSHIP is also marine brokerage, they on behalf of charterers and ship owners, organizes signing the charter-party by time or voyage VICONSHIP is the Do Thi Thao Tam - IBL0402 Page 20 Green Port Fieldtrip Report only shipping agent of two largest shipping companies in the world that shipping firm TS Lines and Dongyoung Shipping in Vietnam With a staff composed of skilled professionals in the declaration of customs procedures for import and export of goods through ports and customs clearance locations in mainland ensure export shipments will be resolved professional, efficient and fast Their employees are always updated with new material every day from Vietnam Customs and ensure timely declaration as well as compliance with government regulations 2.1.5 Stevedoring Loading and unloading and packaging of goods have also been of concern, attention and timely investment Currently, the handling process at warehouse and port area are performed by the specialized equipment Further, forklift truck driver team are trained basically and practice loading and unloading many years, has extensive experience loading and unloading so the quality and duration loading and unloading always be guaranteed This activity is also a positive contribution to the finished products, enhance revenue and profitability for the company 2.1.6 Inland transportation Currently, the company is managing and exploiting the specialized container trucks, operating on roads Moreover, the company also has the task of providing all the services needed to transport cargo traffic between Vietnam and all over the world by land, sea and rail The company has the specialized transport vehicle capable of transporting across all regions of the country and transport all goods but not limit the width, large or small size The use of specialized vehicles and a team of skilled driver gave the company a solid reputation Furthermore, to ensure service quality is increasingly enhanced for customer, companies often perform repairs, maintenance, inspection container, set up supply stations of fuel and oil to be take the initiative in providing fuel for business operations of the company Do Thi Thao Tam - IBL0402 Page 21 Green Port Fieldtrip Report 2.2 Finance 2.2.1 Total assets and equity Unit: % 2010 2011 2012 2013 Q1/2014 CURRENT ASSETS 65% 69% 52% 44% 45% Cash and cash equivalent 11% 7% 4% 25% 25% Short-term financial investment 41% 45% 31% 5% 7% Receivable 10% 11% 11% 9% 9% Inventory, net 1% 1% 1% 1% 1% TOTAL ASSETS 100% 100% 100% 100% 100% LIABILITIES 33% 25% 28% 22% 20% Short-term debt 32% 25% 25% 21% 19% OWNER’S EQUITY 67% 75% 72% 78% 80% TOTAL CAPITAL 100% 100% 100% 100% 100% Table : Total Assets and Equity Asset structure has significant change with current asset decreased from 52% in 2012 to 44% in 2013 Until end of 2013, cash and cash equivalent increased rose by times compared to the same period last years In contrast, short-term financial investment also decreased by times compared to last years (from 31% in 2012 to 5% in 2013) On average, in years, the company's liabilities also dropped significantly, from 32% to 20%, about 12 % Meanwhile, VINCONSHIP’s owner’s equity also increase obvious, approximately 13% The company’s ROE and ROA trended downward together as net income had a lower growth rate than total assets and equity ROE decreased from 29 percent in 2009 to 19 percent in 2014 due to the decreases in all factors (net margin, asset turnover and asset to equity) This showed that the company’s profitability declined or the efficiency of equity and assets reduced Do Thi Thao Tam - IBL0402 Page 22 Green Port Fieldtrip Report FIGURE : ROE and ROA 2.2.2 Income, revenue, profit Do Thi Thao Tam - IBL0402 Page 23 Green Port Fieldtrip Report Unit: billion VND 2009 2010 2011 2012 2013 Q1/20 14 Net revenue 457.51 548.49 644.21 779.42 791.87 198.71 Growth rate of net 46.29% 19.88% 17.45% 20.99% 1.60% revenue Gross profit 180.06 197.48 229.16 267.87 17.75% 303.24 Growth rate of gross 56.39% 9.67% profit 16.04% 16.89% 13.20% Operating income 231.78 174.06 210.97 286.22 288.44 Growth rate operating income of 53.27% 21.21% 9.86% 23.49% 0.77% Profit after tax mother company of 155.05 228.63 179.70 191.00 Growth rate of profit 48.64% 15.09% 6.29% after tax 240.46 19.70% 5.18% 47.72 5,41% Table : Income, Revenue and Profit It can be seen, revenue and profit of VICONSHIP increase over the years, from 2009 to 2013; although, in 2013 profit and revenue is only increased slightly compare with 2012, but this average period, revenue rise 15% and profit fall 12% even in the context of difficult market and volatility in the years This is also a positive before tax declined 30.8% compare to 2012 VICONSHIP’s revenue in 2013 reached 797 billion, mainly thanks to growth of the port loading and unloading operation and business of CFS Besides, gross profit margin has improved significantly, from 34.4% in 2012 to 38.3% in 2013 However, it should be noted that revenue from interest income plummeted more than 18 billion VND net profit margin went up by 1% Accordingly profit after tax reached 240 billion VND In the first quarter in 2014, net revenue and profit after tax drop up compare to the same period time last years Do Thi Thao Tam - IBL0402 Page 24 Green Port Fieldtrip Report By these charts, we can see that revenue and profit of VICONSHIP although fluctuated but overall still increased Besides, the Company has encountered some difficulties as well as the impact of the economic downturn, the shipping industry is in tough times, the competition is getting fierce, and insufficient transport infrastructure has slight fragmentation, the amount of cargo through some areas reduced price of services, warehousing, port Do Thi Thao Tam - IBL0402 Page 25 Green Port Fieldtrip Report CHAPTER 3: EVALUATION OF VICONSHIP’S BUSINESS 3.1 - - The enterprise has good management team with growth and business efficiency high over the years Enterprises accounted for a large share of trading terminal in Haiphong and the North - Having many modern machines, equipment and experience, expertise staffs - Got more foreign investment from developing, developed countries Having many experiences in the business field of loading and unloading service, transportation, transshipment, packing services 3.2 - - - - Opportunities Now, old ship sale and purchase prices are low, it will help businesses reduce investment costs, additional vessel or container according to plan this year Having relation with many other corporations, thus VICONSHIP has stable customer source These customers have no risk of losing the ability to pay 3.4 - Weakness Fixed assets are still low compared to the potential development of the transport sector and storage terminal VICONSHIP’s geographical location is far from the estuary, so the big ship difficult to run deep inside 3.3 - Strengths Threats Fuel prices are rising again and potentially higher, according to which the transport costs of the enterprise will increase again compared to the first half year Import and export of goods Vietnam according to forecast to decline Meanwhile, the level of competition in main business areas - Haiphong Port to add new ports operated Accordingly the business will face a fall in revenue - Market globalization, thus have to competition with many other firms The imbalance in supply and demand, exports and imports lead to difficult in produce and business Do Thi Thao Tam - IBL0402 Page 26 Green Port Fieldtrip Report CONCLUSION VICONSHIP is known as one of the heads of our country transport Experienced a long period of development, the company has contributed to economic development of our country From the initial operation, the company has expanded into many career as well as many useful services Besides, it is constantly innovating both quantity, quality and development activities to help the company further develop I am honored to visit the port VICONSHIP especially Green port Through this fieldtrip, I understand more the company's operations as well as the export, import of goods process what I just learned in university This report is about to present the lessons that I gain, watch and experience myself Thus, I feel very thankful for the aid of the workers of VICONSHIP Company and the teachers who have helped me a lot to complete the first internship successfully Do Thi Thao Tam - IBL0402 Page 27 Green Port Fieldtrip Report REFERENCES Charts, pictures, information of VICONSHIP retrieved from Vietnam Container Shipping Corporation Official Website, http://www.viconship.com Hau, T.T (2014) Analysis of the current situation and measures for improving the financial situation of Vietnam Container Corporation Haiphong: Haiphong Private University Trang, P.N.T (2014) Company analyst report Hanoi City Do Thi Thao Tam - IBL0402 Page 28 Shipping Green Port Fieldtrip Report CERTIFICATE SUPERVISOR) Do Thi Thao Tam - IBL0402 OF APPROVAL Page 29 (FROM THE