Analyzing operational efficiency of paper enterprises in Vietnam and an empirical financial forecasting

enterprises Total Revenue 14.524 17.386 21.182 19.677 18.040 16.238 Total Assets 12.425 16.150 18.224 19.485 14.375 12.727 Total Equity 6.311 8.431 9.841 10.166 8.299 4.940 Total Profit after tax 452 730 964 1.017 688 259 Taxes and other payables to the State budget 1.044 1.070 1.376 1.049 744 619 Large enterprises Total Revenue 23.997 30.677 32.247 37.435 41.392 54.705 Total Assets 27.812 32.722 34.814 37.507 39.659 56.751 Total Equity 6.804 8.921 10.286 13.401 17.778 27.350 Total Profit after tax 316 1.037 824 1.658 2.042 2.792 Taxes and other payables to the State budget 1.449 1.337 1.804 1.959 2.677 3.348 Total Total Revenue 86.692 85.347 94.047 103.831 110.547 128.890 Total Assets 76.361 88.556 95.448 102.847 112.635 129.530 Total Equity 26.464 30.868 35.655 39.898 46.674 53.355 Total Profit after tax 3.220 1.770 1.342 2.474 2.311 3.365 Taxes and other payables to the State budget 4.541 3.741 4.502 4.481 5.078 5.893 824 Source: Calculated by author Table 7. Statistics of some results indicators and efficiency indicators (2012-2017) Year Average revenue (million) Growth rate (%) Average taxes and other payables to the State budget (million) Average ROA (%) Average VA (million) 2012 45.175,54 2.366 -0,0429618 13.241,09 2013 42.609,66 -5,7% 1.868 0,0140443 13.129,52 2014 45.302,21 6,3% 2.169 -0,0050817 14.417,03 2015 46.602,67 2,9% 2.011 -0,0209136 15.576,45 2016 49.197,68 5,6% 2.222 -0,0088889 16.124,54 2017 52.910,55 7,5% 2.372 0.0085718 17.767,89 Source: Calculated by author Figure 5: Chart of business results of Vietnam’s paper enterprises in the period of 6 years (2012-2017) Source: Calculated by author 3.2. An empirical analysis of financial forecasting Financial forecasting is the forecasting of basic indicators on the financial statements of an enterprise for the upcoming business period. Since then, business owners will easier identify additional capital that needs for enterprises. Database of past business periods will be used to forecast the next stages of Vietnam’s paper enterprises. So this information will 0.00 10,000.00 20,000.00 30,000.00 40,000.00 50,000.00 60,000.00 2012 2013 2014 2015 2016 2017 Average revenue (million VND) Taxes and other payables to the State (million VND) Average VA (million VND) 825 help business owners take the initiative in financial planning to secure capital for investment activities. The empirical study is based on the audited financial statements of Viet Tri Paper Joint Stock Company (GVT) in the period of 4 years (2014-2017). This paper prodive financial forecasting of Viet Tri Paper Joint Stock Company for the year 2018. Since then, the objective of this empirical study show a financial forecasting method for Vietnamese paper enterprises which provide management policies for executives to achieve their goals. Firstly, determine the growth rate of revenue of GVT Company. From 2014 to 2017, revenue of GVT Company was not stable, revenue in the year 2016 went down 6.84% compared to this ratio in the year 2015. But in the year 2017 the growth rate of revenue of GVT company increased sharply 27.23% compared to 2016 (Table 8). Based on the average growth rate of this period and considering the upward trend in the overall paper market in Vietnam (Table 7), the analyst forecasts GVT Company's revenue growth rate in 2018 will reach 8%. Table 8. Overview of the financial situation of GVT Company (2014-2017) Indicators 2014 2015 2016 2017 Growth rate of revenue 0,34% -6,84% 27,23% Net Sales 970 973 906 1.153 Cost of goods sold 882 883 824 1.056 Gross profit 87 90 82 97 Selling expenses and administrative expenses 40 42 34 51 Profit before tax 17 17 15 20 Cash 8 13 18 20 Account receivable 193 187 199 167 Inventory 244 327 246 211 Account payable 135 168 100 135 Source: Audited financial statement for the period 2014-2017 Secondly, determine the variables that change by revenue. Based on the percentage of revenue over the last four years to review this trend and forecasts for 2018. For the GVT Company, we can forecast in 2018 cost of goods sold per revenue at 91% due to this rate is quite stable over the years, fluctuating around the 91% mark. Similarly, the author based on the average of the indicators for the period 2014-2017 in table 9 to forecast the percentage of indicators per revenues for 2018. The major financial indicators include Selling expenses 826 and administrative expenses, Profit before tax, Cash, Account receivable, Inventory, Account payable (Table 10). Table 9. Percentage of financial indicators per revenue Indicators Percentage of financial indicators per revenue 2014 2015 2016 2017 Cost of goods sold 91,0% 90,8% 90,9% 91,6% Gross profit 9,0% 9,2% 9,1% 8,4% Selling expenses and administrative expenses 4,1% 4,3% 3,8% 4,4% Profit before tax 1,7% 1,7% 1,7% 1,8% Cash 0,9% 1,3% 2,0% 1,7% Account receivable 19,9% 19,2% 21,9% 14,5% Inventory 25,2% 33,6% 27,1% 18,3% Account payable 13,9% 17,2% 11,0% 11,7% Source: Calculated by author Finally, forecast main financial indicators. On the basis of the forecasted revenue in step 1 and forecasted percentage of financial indicators per revenue on some basic indicators, analysts easily forecast financial indicators in 2018 as shown in Table 10. These indicators is the basis for making forecasts on business results and forecasts of the accounting balance sheet. Since then, business owners have backgrounds for determining the additional capital demand for 2018. Table 10. Forecast of main financial indicators Indicators Percentage of financial indicators per revenue forecasting Forecast of value 2018 (Billions VND) Net Sales 1.245 Cost of goods sold 91,0% 1.133 Gross profit 112 Selling expenses and administrative expenses 4,5% 56 Profit before tax 1,8% 22 Cash 1,5% 19 Account receivable 19,0% 237 Inventory 20,0% 249 Account payable 12,0% 149 Source: Calculated by author 827 4. Conclustion Results from this analysis show the current business efficiency of Vietnam’s paper enterprises in the past (2012-2017). Research shows that the basic characteristics of Vietnamese paper industry that Vietnamese paper enterprises concentrate in industrial zones, mostly small scales and privately owned. The average annual income of workers working in this field is about 78.5 million VND per person per year. Although Vietnam’s paper enterprises are increasing their consumption volume, their business results in recent years are not good, leading to unstable performance. The paper implicate that Vietname’s paper enterprises should consider many factors investing in this sector and should take management measures to ensure increased consumption along with increase profit and improve business efficiency. Some factors that need to be considered and improved are the production line, the stability of the input materials, especially the recycled materials, the measures of waste disposal in the environment. In addition, the paper recommends that Vietnamese paper enterprises improve their business performance and financial forecasts to ensure good control over business activities in the next period. 5. 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