University of Economics Ho Chi Minh City

Simulation

Annual Report
of

Aphrodite Inc.
(Advfirm 81)
Instructor :

Group 5 – KDQT _ 1 - Member List

Name Number Class
1. Vũ Kim Hằng KDQT_1
2. Lê Kiều Khuyên KDQT_1
3. Dương Tùng Lâm KDQT_1
4. Hà Thị Khánh Linh KDQT_1
5. Đỗ Bảo Ngọc KDQT_1
6. Trần Thị Hồng Nhung KDQT_1
7. Võ Minh Thảo KDQT_1
8. Phí Thị Thanh KDQT_1
9. Nguyễn Ngọc Trâm KDQT_1
10. Thái Nguyễn Tường Vy KDQT_1

Ho Chi Minh City, 1 - 2010

 Instructor’s Comment

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 Member’s Cross Comment
Member Hằng Khuyên Lâm Linh Ngọc Nhung Thảo Thanh Trâm Vy
1 100 100 100 100 100 100 100 100 100 100
2 94.5 97.5 92 92 98.5 98.5 91 94.5 91 91
3 91 96 90 92 94 94 89 92 88 88
4 92 94 91 88 96 93 92 91 89 92
5 100 100 75 92 100 100 81 100 87 88
6 96 100 94 97 100 99 96 96 94 94
7 99 100 99 99 100 100 99 100 98 85
8 96 99 95 94 98 94 93 93 94 94
9 100 100 100 100 100 99 100 100 98 99
10 99 100 99 99 100 100 99 99 95 93
Weighted
96.75 98.65 93.5 95.3 98.65 97.75 94 96.55 93.4 92.4
Average

Change
9.675 9.865 9.35 9.53 9.865 9.775 9.4 9.655 9.34 9.24
100 into 10

Notes:

Criteria Point
1 Attendance 10
2 On time 10
3 Prepared 10
4 Discussion 10
5 Attitude 10
6 Quality 10
7 Task done 20
8 Team player 10
9 Bonus 10
Total 100
Headquarter: Vodickova 36 110 00 Praha 1, Czech
Republic, EU.

Phone: +1 813 489 1980

Fax: +1 813 489 1437

 From Life To Life

Aphrodite Inc. is one of the most popular companies in the Perfume Industry.
We supplies products with high quality for both sides – ladies and gentlemen.
Our first product named Gentil – men’s aftershave – was first introduced to
public in the end of 2000.

After having a great success in EU, Aphrodite expanded not only the ranges
of products but also into NAFTA.

Until now, the company has two ranges of products: Men’s aftershave –
Gentil in EU and Challenger in NAFTA; Ladies’ perfumes – Tiamo in EU
and Hi Sweetie in NAFTA.

Our success bases on suitable strategies, diverse innovative talented

workforces and strong corporate culture.
1. Financial Highlights

2. Letter to Shareholders

3. The Organization

4. The Marketing

5. The Finance
 From Life To Life

Table of Contents
1. Financial Highlights 1

2. Letter to Shareholders 4

3. The Organization 6

 Managing board 7

 Human Policy 8

4. The Marketing 10
 Products 11
 Marketing Operation 13

 Marketing Used Tools 20

 Some Special Events 21

 Marketing Development 24

 Future Events 25

5. The Finance 26

 Financial Statement 27

 Sales Forecast 32

 Capital Structure 34

 Economic Development 36

 Dividend policy 39

5. The Finance
 Page 1

1. Financial Highlights
Overview:

US Dollar Year 2010 Year 2011 Year 2012

Sales Revenues 12,627,820.88 12,834,072.38 22,067,402.75

EBIT 7,255,170.63 8,523,542.36 12,996,354.93

Net Income 2,679,065.68 2,818,763.80 3,809,102.69

Income tax 2,460,483.53 2,297,772.31 1,505,785.00

Total Dividend 199,500.00 1,140,000.00 3,690,000.00

Balance Sheets

Current Assets 12,108,816.25 22,317,619.00 30,489,128.50

Cash & cash equivalents 6,664,113.88 15,782,211.00 16,044,441.00

Shareholders’ equity 9,938,815.13 17,447,618.75 25,619,128.50

Liabilities 2,170,000.00 4,870,000.00 4,870,000.00

Cash flow 5,677,644.50 15,782,212.50 11,549,212.00

(Per share data)

Net dividend 0.65 3.80 12.30

EPS 7.87 9.39 9.71

Share price 10.14 16.74 22.27

 Page 2

1. Financial Highlights
In the first year, our IPO is 350,000
shares at $4.01. Starting up with this
capital, company operated very
effective, EPS increased from $
0.5861 (Q.2/2010) to $ 0.9784 (Q.3/
2010). In the end of the first year, we
decided to repurchase shares. With
reducing shares policy, we wanted to
bring more value to investor and get
more control with company.

Repurchasing share
was done in two
quarters with 50000
shares. After this
decision, in the first
quarter in 2011, EPS
was $ 2.6838 and
stock price was
$10.14. That was a
pleasure result for our
investor.
 Page 3

1. Financial Highlights

In 2011, we decided to
launch $1,200,000 bond to
guarantee capital for budget,
investment project and
adjusting debt ratio. With
this capital, we expanded
operation, invested in stock
market and opened
subsidiary.
 Page 4

2. Letter to Shareholders
Dear Shareholders,

Through three years, from 2010 to 2012, we have been making significant
progress.

Years 2010 is important year. Aphrodite’s stocks first issued at Scent

Stock Market at IPO price about $4.01 per share. Also, this year was
highlighted by noticeable record of sales and earning per shares.

Although year 2012 is difficult year for most of companies in Perfume

Industry, by well – prepared financial and marketing strategies – creating
suitable financial structure, issuing bonds and improving in products,
Aphrodite Inc. still was one of the best companies with gradual
development. Our stocks were preferable top stock.

After recession, year 2013 is recovering year. Despite high competition in

market, political change etc, Aphrodite Inc under leadership of Managers
and cooperation of whole staff still followed accurately as pointed
company’s vision and mission from starting up years.

In just three years time, we have created good relationships with both the
suppliers and the retailers. We have been getting loyal customers. Our
reputation is more well – known on global market. Our business will soon
expand significant all over the world in future.

There was no denying that the global economic, issues and finance have
had impact on our business. However, our firm’s development and
success have been obtaining that always base on adamant long – term
growing and vital values.
 Page 5

2. Letter to Shareholders
In changeable future with new things and better economy, the invaluable,
but vital, core of Aphrodite, gained for many years, is always existed.
Beginning in year 2013 with significant record – net income about $
2,039,329.25 - we believe in successful year and green future.

Future main aim of us is improving Aphrodite to higher levers, to big

family of love. We small parts of Aphrodite Family will try all our best to
keep our cores, to adapt changes, to strengthen our firm and to satisfy the
best for related sides.

Finally, thankfully, we express our deepest appreciation not only to all our
employees around the world for their commitment, dedication,
innovation, contribution and for taking necessary actions to make
company’s goals realities but also to all shareholders and our clients who
create golden opportunities for us to prove ourselves.

Yours faithfully,

DO BAO NGOC

Chief Executive Officer

 Page 6

3. The Organization
Managing board

Human Policy
 Page 7

Managing Chief Executive Officer

Đỗ Bảo Ngọc
.

Board

Financial Department Marketing Department

Chief Finance Officer Chief Marketing Officer

Trần Thị Hồng Nhung Võ Minh Thảo

Vũ Kim Hằng Hà thị Khánh Linh

Buying and Merchandising

Accounting Department
Department

Thái Nguyễn Tường Vy Phí Thị Thanh

Human Resource Department Area Presidents

NAFTA
Nguyễn Ngọc Trâm
Dương Tùng Lâm

EU

Lê Kiều Khuyên
 Page 8

 Human Policy

2009 2013
Personnel Expenses 2010 2011 2012
(Q4) (Q1)

By region

NAFTA 48731 114264 288501 837285.5 276776

EU 73194 259513.5 429647 1447993 453868.5

Total 121925 373777.5 718598 2285309 730644.5

By product

A1P1 23893 48296 109935 296881.5 87616

A2P1 24838 65968 179016 540434 189160

A1P2 25281 37100 113142 348479 79888.5

A2P2 47913 222413.5 316505 1099514 373980

Total 121925 373777.5 718598 2285309 730644.5

 Page 9

 Human Policy
Diversifying for sales by Human Resource Policy by regions, kinds of products
and seasons help our company know how to care and satisfy the need and hope
of our sales representatives. Besides the basic rights and responsibilities that all
the workforce has, the differences between lives in both regions (EU and
NAFTA), seasonal and kinds of product create the differences in salaries and
commissions every individual sale representative receives. Going into details,
until now the highest salary and the highest commission are paid for A2P2 in
UE. In the last quarter, we paid 6600Euros/ sale rep and 20/product. It is much
higher than in NAFTA. Furthermore, the expenses for workforce in the last
quarter are as approximately six times as the one in the first quarter.

Salaries and commissions are not the only thing showing our care for company’s
workforce. Two meetings a year and some celebrities are organized to create the
play ground for all members of company. The purposes of them are to help sales
representatives can create new relationship with other sales reps in different
regions and get more information about the sales all over the world by exchange
experiences together. This gets results more than our expectation in the past and
is going to be promoting wider in the future.

Furthermore, “the seller of the year” is the annual reward to commend and
reward the best sales representative who has the highest number of sold products
in a year. The award has excited and encouraged sale reps and create good
competitive environment them to promote better and better.

All of the events mentioned before is lead to the main purpose of our company –
the more satisfied customers feel, the more developed our company is.
 Page 10

Products

Marketing Operation
 Page 11

Products
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Complex and sensual, this modern

scent is a fresh, yet subtle mix of spice, fruit
and exotic woods in an elegant black bottle.

Keeps your face just as cool and

smooth as chrome
 Page 12

The Beauty of Brazil is fragrance

inspired by the colorful summer of Brazil :
the sandy beach , the sweet fruit and life
sunny.
All as drawing up a picture with
nuances of modern dedicated to the
beautiful tropics.
Scent is a combination of flavor
papaya , orchids, coconut milk ice cream,
leaving a sweet scent remains on the skin

Tiamo creates a famine Woody

scent that is both subtle and
compelling.
Featuring a lovely honey and
sandalwood base blended with
understated notes of black pepper
and Ylang essence keeps this
fragrance surprising and seductive.
 Page 13

 Marketing Operation
With the view to publicizing our brand name, positioning Aphrodite as one of
the high-class cosmetic companies on both markets, Promotion & Marketing
strategy is also designed for supporting sales operation and social
commitment…

CHALLENGER SWEETIE GENTIL TIAMO

Happy Valentine day: “Connect yours Hearts” program – Products of
Aphrodite will be advertised in some cinemas on Valentine Day.
Q
Moreover, couples will receive cinema tickets when buying products of
1
Aphrodite on this special occasion. :” Present voucher or couple ticket
to see astronomy, gift boxes or underwears, watch, rings…
Summer
Year
Sponsor for product –
2010 Q
World Cup in advertise at “
2
South Africa Cannes Film
Festival”
Sponsor for Sponsor for
Q
fashion shows in fashion shows
3
New York in Milan
Page 14
 Page 15

Page 16

“Santa’s gifts” program – once “Santa’s gifts” program – once

buying any product of Aphrodite, buying any product of Aphrodite,
customers will receive a Christmas customers will receive a
Year Q
gift and have chances to lucky Christmas gift and a Christmas
2010 4
lottery. card from the company.

Besides, customer will receive Besides, customer will receive

15% discount on every products. 10% discount on every products.
“Valentines Close” program : Give couples some love gifts to warm up
Q their emotion when they choose our product as a present in this
1 occasion such as couples T-shirt, travel tickets to 5-stars Vinpearl
Resort in Vietnam or voucher to shipping in plazas…
Advertise in
Summer some Football Mother’s Day
Beach events Mother’s Day Leagues such as deluxe: Present
with sporty deluxe : Present Premier League vouchers or
Q manner vouchers or tickets or Bundesliga… tickets to use
Year
2 (example: to use spa services spa services
2011 -Summer sport
beach soccer when customer when
on beach, as
or water choose Sweetie customers
water-skiing
surfing…) choose Tiamo.
festival.
Advertise in New Advertise in
Advertise on
York fashion Advertise on the Milan fashion
Q the Cars and
shows and in Cars and Men shows and in
3 Men
departments of magazine. departments of
magazine.
luxury plazas luxury plazas.
 Page 17

Celebrating Noel party with the

“White dreams” program to raise
attendance of President of France
Year Q the fund for homeless children in
Nicolas Sarcozy and raise up the
2011 4 both areas thanks to the help of
fund for orphan child.
Bill Gates..

-“woman’s day
warmly: Give
customers two
-“ New Year Woman and
invitation tickets
Product begin valentine’s day
to attend dinner-
with sporty special: program
party. This party
manner: performs from
will present
celebrate - Advertise on beginning
flowers for
Year Q casting lots to TV and February to
woman in this
2012 1 get voucher in Fashion ending March.
party.”
plaza or Magazine. We will present
- “Valentine’ s
department , travel tickets to
day close : Give
with the total France in 2 days
couples T- shirt
20-50% of n’ 1 night “.
in order to
value contract ”
connect their
love so
unshakeable”
Page 18
 Page 19

- Advertise
“Mother’s day -Advertise in at vogue’s
deluxe: Present 2 “The Football summer
voucher or ticket Association fashion
to use spa Premier week.
Q - Present 2
services. It is League”
2 tickets to
close to -Summer sport
connecting in beach, as attend this
mother and water-skiing fashion
Year
child.” festival. show.
2012

Advertise in
Advertise in Advertise on TV
fashion Advertise on
Q fashion show , , Milan fashion
magazine and TV, magazine
3 TV , big moving and department
radio station, and bar
banner of luxury plaza.
bar

Q
“White dreams” program to raise the fund for homeless children in both
4
areas thanks to the help of Bill Gates...
 Page 20

MARKETING USED TOOLS

 Advertise poster on THE BOSS every quarter of years.

 Advertise or support fashion shows.

 Use Icon branch for products and use PGs teams to attract the
intention of clients.

 Advertise at fashion - cosmetics magazine (ex: VOGUE,

COMSOPLITON ...)

 Establish website to promote our products.

 Banner , poster at departments and commercial plazas , cinema

theatres
 Page 21

SOME SPECIAL EVENTS

 In Q1-2010, Happy Valentine day: “Connect

yours Hearts” program was taken place – Products of
Aphrodite will be advertised in some cinemas on
Valentine Day. Moreover, couples will receive
cinema tickets when buying products of Aphrodite on
this special occasion. :” Present voucher or couple
ticket to see astronomy, gift boxes or underwear,
watch, rings…
This is the first marketing event to break into
markets and we had great consequences. This did
have a big impact on our sales and assumed the
majority of the sales in NAFTA with 44% market
share of aftershave for men and 25% market share of
perfumes for women while the percent of aftershave
was 38% and perfume was 17% in EU.

 In Q2-2011, we
held some Summer
Beach events in both
areas for Aftershave
products with sporty
manner (example:
beach soccer or water
surfing…) and Beach
Parties where David
Beckham was our
ambassador in order
to keep loyalty of
customers and
retailers. These
events really made
good impression to
our customer. At the
end of Q2-2011, we
captured 18% of
market share in EU
and NAFTA with
increasing net sales
 Page 22

 Every year, we specially

focused on Women Day and Mother
Day to promote our fragrances. In
these occasions, we gave to
customers vouchers to Thailand or
tickets to use SPA services.

 In Q3-2011, we advertised
our perfumes in New York and
Milan, where are the capitals of
fashion of NAFTA and EU. In these
fashion shows, we invited some
celebrities such as Britney
Spears to introduce perfume
products. Present fragrance to
retailers and other customers

 “Santa’s Gifts” program for

any perfumes in any area (NAFTA
or EU) from Dec 1st to Dec 31st
in 2010, our customer received a
luxurious gift box and a
Christmas card with best wishes
from the company…
Besides, they had discount 10-15%
and opportunities to lucky
lottery.
Thanks to this program, our
market share in EU increased
sharply, from 18% in Q3 to 45% in
Q4.
 Page 23

 Every year in December, we hold up a White Party which is an

fundraiser party for homeless children. The party required all guest
have to dress in white. There had been some famous people attendance to
contribute for orphanages and homeless people.
This event was followed by the “White Dreams” program which was hold
to raise the fund for homeless children in both areas, thanks to the
help of Bill Gates.
We were appreciated by customer through years and they also bought our
products to contribute to this program.
 Page 24

Marketing Development
Fragrance industry is always a high risk industry with high pressure from new
products and trends of customers. With experience of ourselves, we create products
with specific quality, scent and style for each kinds of product, and we are always
trying to improve all faces in order to meet customer needs.

As quoted vision and mission, we have been making innovative products and
always maintaining our Quality Control at the high levels since starting quarters. At
first, it made our cost greater. However, by applying advanced technological
scientific methods, we have created advantages for our products and our firm. High
Quality Control with pointed actions in marketing plan, it help us creating the
customers’ trust and loyalty clients.

Setting price is very important issue. We have set suitable prices for each segment,
for each product range, and for each country. In comparison with our competitors’
prices, our prices are competitive. The variation in price of each product is based on
company’s strategy and segment. For instance, we focus Challenger on middle
class or below, so Challenger’s price is usually the lowest in comparison with
competitors’. Otherwise, Tiamo’s price is highest price because we focus it on high
- end class. However, with the desire to create a breakthrough in the industry and
having new advantages, we have some changes in our strategies. Specifically, at the
end of year 2010 to now, we improved our product, spent more on Advertising
budget, increased Sale reps team etc to encourage customers’ wish, to meet their
need etc. Therefore, we push price of Challenge up to $144.

Our marketing decisions depended on each quarter and related conditions. In

future, we always strive to get higher levers. Making our products to high – class
ones is our vital goals.
 Page 25

Future Events

 On the occasion of Valentine 2012, Aphrodite will be the exclusive

sponsor for London Fashion Week and presents tickets for couples. Besides, you
will have the opportunity to see Emma Watson - one of the sweetest actresses in
Hollywood: ‘Love you and Love me” in a film of us – “The Moment”.
Moreover, its trailer is also going to be shown in some cinemas in both NAFTA
and EU as well as the advertising clip of Aphrodite’s perfumes for women when
this film launches globally in December 2013. And the last one, women will get
free underwear for each 500$ available bill when buying perfume.

 In this summer season 2014, Aphrodite Inc. will introduce our products
in Euro Championship. Posters and brochures for advertising and promoting will
be public in stadium and some main streets in this country. Furthermore, we
celebrate a Night Event at a luxury hotel for customers and lovers of football-
player while they go to cheer Euro Championship.

 One successful company is always caring about their executives. So, we

award our executives travel ticket in a short time, and permit them be in holiday.
We believe that is things make our executives feels comfortable and happy in
Aphrodite Inc Company.

 In Noel season 2014 years, we will have celebrated a big party for close-
customers in luxury vessel in both NAFTA and EURO areas. We will present
Christmas gifts for them. And a fund for orphan children will also be raised.

In the end of 2014, we will hold a meeting for staffs of both areas NAFTA and
EURO to create relationship and exchange experiences.
 Page 26

Financial Statement

Sales Forecast

Capital Expenditure

Economic Development
Dividend policy
Dividend policy
 Page 27

Financial Statement
Consolidated Income Statement

US DOLLAR 2010 2011 2012

Revenue
Sales Revenue 12627820.88 12834072.38 22067402.75
Less: Processing Costs 7831 5660 8271
Net Sales 12619989.88 12828412.38 22059131.75
Investment Income 0: .0000 0 0 19709.16
Marketable Securitities 0 0 302000
Expenses
Cost of Goods Sold 5372430.25 4304870.02 9062776.82
Advertising 583724 1330000 2760000
Quality Control 272762 338762 981059
Bad Debts 20457.07 25859.87 45574.63
Product Improvement 0 0 0
Engineering Studies 0 0 0
Sales Expense 407392 904375.5 1775873.5
Administrative Expense 200000 200000 200000
Invt./Shipping Charges 8382.3 24946.7 28995.6
Maintenance 0 0 0
Depreciation 0 0 0
Interest Expense 332386.87 136361.23 127417.72
Factor Cost 22986.13 0 0
Miscellaneous Expense 259920 156000 323400
 Page 28

Consolidated Income Statement

Income
Income Before Taxes 4484125.51 5408199.57 7075743.44
Income Taxes 186240.33 1563856.5 3266640.75
Net Income 2679065.68 2818763.8 3809102.69

Statement of Changes In equity Statement

US Dollar Fiscal 2010 Fiscal 2011 Fiscal 2012

Common Stock 300000 300000 300000
Retained Earnings 2291758.25 4585523.00 6204625.00
Total Equity 3445662.50 5748534.00 7375053.50
 Page 29

Consolidated Statement of Cash flows

Statement
US Dollar Fiscal 2010 Fiscal 2011 Fiscal 2012
Cash Inflows:
Net Cash Sales 7574294.63 7702920.19 13236826.75
Investment Income 0 962.63 19709.16
Income from Subsidiary 0 0 302000
Collection of Receivables 3175723.94 4011270.19 8063884
Receivables Factored 540850 0 0
New Special Loan 0 0 0
New Short Term Loan 900000 0 0
Change in Term Loan 0 0 0
New Bond Less Discount 1148320 0 0
New Stock Issue 1403500 0 0
Cash Available for Operations 5681848.5 6879603 8710116
Cash Outflows:
Raw Mtls at Market *.85 0 0 0
Mfg Labor Costs *.85 0 0 0
Bad Debts Expense 20457.07 25859.87 45574.63
Advertising Expense 583724 1330000 2760000
Quality Control Expense 272762 338762 981059
Product Improvement 0 0 0
Engineering Studies 0 0 0
Sales Expense 407392 904375.5 1775873.5
Administrative Expense *.65 130000 130000 130000
 Page 30

Consolidated Statement of Cash flows

Statement
Inventory and Shipping Costs 8382.3 24946.7 28995.6
Maintenance Expense 0 0 0
Interest Expense 329802.87 127254.21 120000
Factoring Expense 22986.13 0 0
Miscellaneous Expense 259920 156000 323400
Income Tax 2460483.53 2589435.78 3266640.75
Beginning Accounts Payable 52500 70000 70000
Beginning Short Term Loan 500000 400000 0
Beginning Special Loan 3249761.31 0 0
Prepay Bonds 0 0 0
Repurchase Common Shares 388300 0 0
Cash Dividends Paid 199500.01 525000 2190000
Raw Mtls Futures *.70 0 0 0
New Construction 0 0 0
Net Cash Flow
Total Cash Disbursements 8885971.31 6621634 11691543.38

Computed Ending Cash Bal. 3277750.75

4113502.50 4495228.50
(-) Quarterly Stmt Cash Bal. 3277691.25 4113501.50 4495229.50
 Page 31

Segment information by product area – By

Region Statement
Region 2010 2011 2012 Change (%)
NAFTA 4274243.842 4109816 8373949 95.9
EU 8353577.038 8724256.38 13693454 64
TOTAL 12627820.88 12834072.38 22067403 75

16000000
13693454
14000000

12000000

10000000 8724256.38
8353577.038 8373949
NAFTA
8000000
EU
6000000
4274243.842 4109816
4000000

2000000

0
2010 2011 2012

BRAND 2010 2011 2012 Change (%)

Aftershave 1696993.35 1914771 3258379.73 92
Perfume 11302169 10639196 18809023 66.5
TOTAL 12999162 12553967 22067403 70

20000000 18809023
18000000
16000000
14000000
11302169
12000000 10639196
AFTERSHAVE
10000000
PERFUME
8000000
6000000
3258379.73
4000000
1696993.35 1914771
2000000
0
2010 2011 2012
 Page 32

Sales Forecast
According to The Boss, the cosmetics market in the developed countries should
achieve sustainable growth. Firstly because of the arrival of new consumers, and
secondly because penetration rates in some markets, even in Western Europe
and North America, still offer very significant growth prospects. Perfumes are a
25 billion dollar industry, yet are one of the poorest performing sectors of the
cosmetics industry. The fragrance market is stagnating and is cluttered with
new scent products which mean there is no longer any brand loyalty. Consumers
jump with speed to the latest new 'designer perfume' product.

Latest research from Euro monitor suggests the men’s and women’s fragrance
market grew year on year by 4.95%. Women’s premium fragrances performed
even better, up 8.5%. These rates will be 5% /year for men’s fragrance market
and 9%/year for women’s fragrance market.

Among our products, TIAMO is very popular in the area of Europe, it's about
revenue and profits highest. Challenger, Hi! Sweety, Gentil are profitable goods.
They are continuing to expect in the future. Therefore, we are improving
technology and budget on all products.

With all information we have from the market trend, Q1-2013 demand is
anticipated to be similar to Q4-2012 demand levels. Q1-2013 forecasts need
only to seasonally adjust the Q4-2012 data and with that data in hand,
incorporate the expected results of management’s changes in its competitive
marketing program.

From Life To Life

 Page 33

Sales Forecast
Below is our sales forecasting for next financial year:

PRODUCT   Q1-2013 Q2-2013 Q3-2013 Q4-2013 Annual Totals

units 2600 5300 2700 11100 21700
Challenger price (USD) 145.00 145.00 148.00 148.00  
TOTAL SALES 377,000 768,500 399,600 1,642,800 3,187,900
   

units 7000 3700 3800 10100 24600

Hi!Sweety price (USD) 322.00 322.00 322.00 322.00  
TOTAL SALES 2,254,000 1,191,400 1,223,600 3,252,200 7,921,200
   

units 1500 3100 1600 6210 12410

Gentil price (USD) 145.00 145.00 148.00 148.00  
TOTAL SALES 217,500 449,500 236,800 919,080 1,822,880
   

units 16000 8400 8600 23000 56000

Tiamo price (USD) 366.00 366.00 368.00 368.00  
TOTAL SALES 5,856,000 3,074,400 3,164,800 8,464,000 20,559,200
   

TOTAL REVENUE 8,704,500 5,483,800 5,024,800 14,278,080 33,491,180

Obtained results in recent years shows that we have a sizeable and loyal client.
In subsequent years, we continue to maintain our marketing strategy and will
certainly expand the market share.
 Page 34

Capital Structure
When our company
set up in 2010, we
issued 350.000 shares
and used a short-
term loan to operate.

But with our

guessing, interest was
increased, we
decided to issue bond
and repurchase shares
to make sure enough
money for operating,
investing. Issuing
bond made our debt
ratio rise suitable.

In the end of quarter 1, 2013, available cash for operation is 4,495,228 USD.
The number cash is sufficient to pay finished good for next quarter.

In next quarter, we will not use short term or long term debt. In our plan, we
are going to repurchase about 400000 USD bond and continue plan in next
two year.

You can see structure capital in the end of quarter 1, 2013 is below. Similar
with years before, we will maintain debt ratio in about safe number (from 0.1
to 0.6)
 Page 35

Capital Structure

We will continue to invest in Bear Bull index in next quarter, because we expect
in brighten economic. We will take about 1 to 1.5 million USD in short
investment.
 Page 36

Economic Development
Economic expert were stated that economy have been bright with positive
economic numbers – both economic index and consumer confident index
have been upward despite recession in 2011.

Economic index, overall, fluctuated upward and hit highest point of 112 in
quarter 1 year 2013. Business people and economists, now, are expecting
wealthy development in following years.

Consumer confident index was lightly different from economic index. Its
trend was unpredictable. Generally, it depended on economic trend. For
instant, in 2011, because of recession, increase in inflation and financial
issues, consumers have cut down their expenditure. However, although year
2012 was recovering year with glad economic index, there was still slight
fall about 8 point from 148 point to 140 point in quarter 4 of 2012. To
understand clients is difficulty. Most of companies are try their best to meet
the customers’ unpredictable needs. Governments of both NAFTA and EU
have been solving their bad debts, controlling inflation rates finding
solutions for new power resources.

Economic Index
115 111 112
109
110 106 107
104
105
99 100 99
100 97 98 97 96
95
90
85
2010 2011 2012 2013
Q1 Q2 Q3 Q4
 Page 37

Economic Development
Moreover, firms all industries are on one hand make pressure to
government to create better operating environment on the other are hand
in hand with government to deal with alarming issues and find good way
to cut down manufacture cost, to increase product values. By that ways,
the index is hoped upward trends.

Stock Market got good development. Analysts and political leaders were
pleased to see the T-Bill rate hold steady at 0.0552 per annum. After
remaining at 0.0300 for 2011 and 2012, T-Bill rate has been expecting to
settle around 5% to 6% for 2013. Both T-Bill rate and Prime rate have
had upward move for three years. Although financial factors are under
control of Central Bank and Government, people are concerning about
the interest rate and money policies. Business should have well –
prepared strategies including back – up strategies in case the capital cost
increase in future.

Consumer Confidence Index

160 148
141 140 141
132
140 120
127
120 109 104 111 108
100 102
100
80
60
40
20
0
2010 2011 2012 2013
Q1 Q2 Q3 Q4
 Page 38

Economic Development

The Euro – Dollar exchange has been moving stably around 1.00, and “The
Euro – Dollar moved slightly but no cause was determined outside of random
movements”

It was amazing how fast the global political and economic conditions could
change significantly for their periods. Therefore, new technologies in
conjunction with the new global financial and product markets will definitely
require new forms of thinking, strategy and behavior from management.
 Page 39

Dividend Policy

Our company always intend to shareholder’s value. During 3 years, dividend

increase from $0.5 to $2.5 /share and we will continue to develop our
business operation and investment to bring more value for you in 2013. In
our policy, dividend payment will be paid three or four times per year. The
maximum rate of increase of quarterly dividend payment is $0.5. With our
company, the best value and the best pleasure to customer and shareholder
will never stop. We believe that we are the best company to invest forever.
Headquarter: Vodickova 36 110 00 Praha 1, Czech
Republic, EU.

Phone: +1 813 489 1980

Fax: +1 813 489 1437