I. NAME, ADDRESS OF HEAD OFFICE, LEGAL REPRESENTATIVE
• Enterprise’s Name: VIETTEL MILITARY INDUSTRY AND TELECOMS GROUP
• Business Code: 0100109106.
• Abbreviated Business Name: VIETTEL.
• Type of business: Single-member limited liability company
• Address: No. 1, Tran Huu Duc Street, My Dinh 2 Ward, Nam Tu Liem District, Hanoi City.
• Legal Representative:
II. ORGANIZATIONAL STRUCTURE
• Viettel Military Industry and Telecoms Group is organized and operates under the model of Holding Company - Subsidiaries. The management structure of VIETTEL includes: Chairman and General Director, Deputy General Directors, Surveyors, Chief Accountant and Assisting Apparatus consist of professional boards and internal control.
• Members' Council are not included in VIETTEL; therefore, all strategic orientations, plans, major projects, personnel and important affairs of the Group shall be decided by the Group's Party Committee.
• Telecommunications and high-tech manufacturing research are the business lines directly managed by the Holding Company. The Group has an Assisting Apparatus and shared service centres (HR, finance and procurement).
• The subsidiaries of the Group are organized by blocks: (1) Domestic Telecommunications, (2) Foreign Telecommunications, (3) Research and Production, (4) Information Technology and Cybersecurity, (5) Tradition.
• VIETTEL's production and Business operations are deployed in 63 provinces/cities in the country and 10 foreign markets. In which, its apparatus is circulated to the district level; Its sales channel system and distribution network are circulated to the commune level.
III. LIST OF COMPANIES HELD BY THE GROUP OVER 50% OF AUTHORIZED CAPITAL
1. Accounting units dependent on the Holding Company (17 focal points and 63 Viettels in provinces/cities)
• Viettel Telecom Corporation.
• Viettel Network Corporation.
• Viettel Business Solutions Corporation.
• Viettel Asset Management Company.
• Viettel Media Company.
• Viettel Cyber Security Company.
• Viettel Academy.
• Viettel Research and Development Institute.
• Viettel Aerospace Institute.
• Viettel Cyberspace Center.
• Viettel Network Technologies Center.
• Viettel Microchip Research and Development Center.
• Viettel Sport Training Center.
• 63 dependent units in 63 provinces/cities: Viettel Province/City.
• Branch of Military Industry - Telecoms Group in the Republic of South Africa.
• Representative Office of Military Industry - Telecoms Group in Singapore.
• Representative Office of Military Industry - Telecoms Group in the Republic of Haiti.
• Representative Office of Military Industry - Telecoms Group in the Republic of Kenya.
2. Viettel's Subsidiaries
a) 06 subsidiaries owned by Viettel with 100% authorized capital
• Viettel Trading and Import-Export Company Limited.
• M1 Communication Limited Liability Company
• M3 Communication Limited Liability Company
• Viettel Technology Investment One Member Co., Ltd.
• Viettel America Company (in the US).
• VTE Technologies Sarl Company (in France).
b) 08 subsidiaries owned by Viettel from 50% to less than 100% of authorized capital
• Viettel Global Investment Joint Stock Company
• Viettel Post Joint Stock Corporation
• Viettel Construction Joint Stock Corporation
• Viettel Consultant and Design Joint Stock Company
• Cam Pha Cement Joint Stock Company
• Viettel-CHT Company Limited
• Viettel Peru S.A.C
• Viettel Russia Company.
IV. HISTORY AND DEVELOPMENT
• On June 1st, 1989, the Electronics and Communication Equipment Corporation (SIGELCO) was established under the Communications Command, Ministry of National Defense. This is a historic milestone marking the birth of Viettel, since June 1st has become the traditional annual day of Viettel.
• On July 27th, 1993, based on the Government Office's Notice No. 198/TB of July 13th, 1993 the Prime Minister's approval for the re-establishment of State-owned enterprise, the Ministry of National Defense issued Decision No. 336/QD-QP on the establishment of the Electronics and Communication Equipment Corporation, its transaction name is SIGELCO, its Head Office is located at 16 Cat Linh Street, Hanoi City.
• On July 14th, 1995, in compliance with the Prime Minister's Decision, the Ministry of National Defense (MoND) issued Decision No. 615/QD-QP, officially change the company's name to Military Electronics and Telecommunications Company, VIETEL in short (At this time, the phrase has only 01 letter T).
• On April 27th, 2004, MoND issued Decision No. 51/QD-QP: from July 1st, 2004, the Military Telecommunications Company was moved from the Signal Corps to the MoND under the name of Military Telecommunications Company, VIETEL in short.
• On March 2nd, 2005, Prime Minister Phan Van Khai signed the Decision on the establishment of Military Telecommunications Corporation It was a milestone affirming a new development step of the Corporation in terms of scale, capacity and experience in the field of telecommunications (from a Company to a Corporation).
• On April 6th, 2005, MoND issued Decision No. 45/2005/BQP on the establishment of Military Telecommunications Corporation, the international transaction name in English is VIETTEL CORPORATION, VIETTEL in short.
• On December 14th, 2009, the Prime Minister signed Decision No. 2078/QD-TTg on the approval of the Pilot Project on the establishment of the Military Telecommunications Group and the Decision No. 2079/QD-TTg on the establishment of the Military Telecommunications Group.
• On July 19th, 2017, Viettel was officially recognized by the Government as a Defense and Security Enterprise under the Decision No. 1059/QD-TTg.
• On January 5th, 2018, Prime Minister Nguyen Xuan Phuc approved Decree No. 05/2018/ND-CP on the Organization and Operation Charter of the Holding Company of Military Industry – Telecommunications Group.
2. Milestones for the development of post and telecommunications services
• July 1997: Deployment of postal services.
• October 2000: Deployment of 178 long distance calls, VoIP technology.
• October 2002: Launch of Internet service.
• September 2003: Deployment of landline telephone service.
• October 2004: Launch of mobile phone service.
• March 2007: Deployment of wireless landline service.
• February 2009: Official launch of Metfone mobile services in Cambodia
• October 2009: Official launch of Unitel mobile services in Laos
• March 2010: Official launch of 3G service in Vietnam.
• September 2011: Official launch of Natcom mobile services in Haitian
• May 2012: Official launch of Movitel mobile services in Mozambique
• March 2013: Official launch of Telemor mobile services in East Timor.
• September 2014: Official launch of Nextel mobile services in Cameroon.
• October 2014: Official launch of Bitel mobile services in Peru.
• March 2015: Official launch of Lumitel mobile services in Burundi.
• October 2015: Official launch of Halotel mobile services in Tanzania.
• January 2017: Obtaining a business license in Myanmar.
• April 2017: Deployment of 4G service in Vietnam.
• June 2018: Official launch of Mytel mobile services in Myanmar.
• June 2018: Deployment of ViettelPay service in Vietnam.
V. DEVELOPMENT GOALS BY 2020
Overall goal: Development of Viettel into a powerful global telecommunications and high-tech industry Group, becoming one of Top 20 Telecom Operators in the World.
• Reaching Revenue from VND 300,000 - VND 350,000 billion, with a growth rate of 6% - 10%/year; Profit from VND 46,000 - VND 50,000 billion.
• Administration and Management: Reform the system of mechanisms and policies to match the organizational model of a Global Group. Shift management from evaluation of results to evaluation of productivity, quality and efficiency.
• Domestic telecoms: Invest in 4G/5G networks covering the whole country, popularize data services; 01 smartphone for each resident, 01 fiber-optic line for each household is the foundation for building a digital society, smart and booming digital services; apply telecoms - IT services to all aspects of social life; Develop IoT and Cloud connection platform.
• Foreign Telecoms: Expand the investment market with an estimated population of 400 - 500 million people; Ranked in the top 10 global telecoms companies.
• Information Technology: Combination of Telecommunications, IT, Cybersecurity, cyberspace: Act as a platform for e-Government; Provide solutions for Enterprises; Play a central role in booming cybersecurity services in Vietnam, creating a cybersecurity industry; Provide services of cybersecurity, mastering cyberspace, ensuring national security.
• Production Research: Promote 3 high-tech industries: Electronics and Telecommunication, National Defense and Cybersecurity to catch up with the 4.0 industrial revolution wave; Master technology, manufacture all kinds of high-tech telecoms equipment for domestic and foreign markets.
• Traditional sectors: Promote and develop breakthrough and take the Group global by following activities: Commerce and E-commerce, Postal - Logistics, Construction Works and Telecoms Infrastructure Management.
VI. RESULTS IN 2018 AND GOALS IN 2019
1. Results in 2018
1.1. Results of the implementation of the main economic indicators
Currency: VND million
Profit after tax
Payables to State Budget
Average income of employees (VND Million/person/month)
2.1. Main missions
a) Administration and Management:
• In 2018, Viettel successfully held the transfer ceremony of Group Leaders, Deputy General Director - Major General Le Dang Dung received the title of Chairman and General Director of the Group (replacing Major General Nguyen Manh Hung), marking Viettel entering the fourth development period: “Viettel 4.0 and global business”.
• Continued to consolidate its apparatus at all levels, focusing on customer-oriented, flexible, streamlined, creative and professional: Reorganized the Group's agency sector, the domestic telecommunications, the Research and production, outsourced simple activities to improve labor productivity, the apparatus focused on new product innovation development; officially implemented a new salary mechanism at the Holding Company - the Group from May 2018, ensuring the payment of the right value for the work.
• Domestic telecoms: Mobile service revenue grew for 3 consecutive years (2016 increased by 1.5%, 2017 increased by 3.8%, 2018 increased by 4.2%); Revenue from fixed broadband services grew by over 50%; The market share of mobile subscribers continued to remain at a high level (over 54%); Standardized mobile subscriber information according to Decree 49/2017/ND-CP; Successfully converted 52 million mobile subscribers from 11 numbers to 10 numbers. This is the largest number of the 5 network operators in Vietnam, accounting for 65% of the total number of converted subscribers of the country.
• Foreign Telecoms: completed the organizational transformation of Viettel International Investment Corporation (VTG) in the direction of holding, taking legal responsibility and investment efficiency; Officially opened Viettel's 10th foreign market business in Myanmar with the brand name Mytel. After 6 months of business (from June 2018 to December 2018), Mytel reached 4.3 million subscribers, the fastest in the investment Viettel markets; After more than 10 years of investing abroad, VTG was officially traded on UPCOM with more than 2.24 billion shares.
c) Information Technology
• Information Technology: Promoted the application of 4.0 technology to many products serving management, business and technology in the Group, step by step realizied Viettel's strategy in the new stage of development 4.0 and global: developed Datalake Data Center of the Group; Applied AI technology for the Facial recognition, Vehicle Detection and License Plate Recognition System;
• Cybersecurity, Cyberspace: In 2018, Viettel was initially recognized as a leading brand in cybersecurity in Vietnam, developed an ecosystem of cybersecurity products, continued to expand service provision, effectively supported information security assessment for 19 large organizations under Ministries/Committee/Government and large domestic corporations/enterprises); Detected 30 zero-day vulnerabilities (serious software vulnerabilities that have never been disclosed in the world) and 02 individuals were included in the top 100 security experts in the world; 6 products and services were awarded awarded the 2018 Outstanding Security Product by Vietnam Information Security Association; Established a Cybersecurity Company specializing in providing information security and cybersecurity services.
d) Production and Research: Viettel has mastered (design, development, manufacturing) telecommunications equipment provided on domestic network and foreign markets. Products deployed on the network: lauched vOCS Online Charging System in 10 markets with 150 million subscribers; lauched switchboard system for 3G MSC in Vietnam, Peru, Tanzania, Myanmar; etc.
e) Traditional sectors: Viettel continued to maintain a sustainable growth rate, successfully completed the set targets and objectives. At the same time, important strategic shifts have been made: consolidated retail operations at Viettel Import-Export and Trading Company; Transformed a Real Estate Company into a Property Management Company; Viettel Post Joint Stock Corporation maintained a high growth rate of revenue and profit for 4 consecutive years (from 2015 to now, average growth rate of more than 50%).
With the above achievements, in 2018, Viettel completed the targets assigned by the Ministry of Defense, becoming one of the state-owned enterprises with the best profits - The most valuable brand - The largest tax payer.
1.2. Social responsibility: Viettel has participated in implementing many social security programs and activities with profound meanings such as: National Target Programs for New Rural Development and Sustainable Poverty Reduction Support Program in the 2016-2020 period; The “Trai tim cho em” (Operation Healthy Heart) programme; Internet to Schools; Because I am studious; Supported 3 poor districts under Resolution 30a; Supported for disaster recovery; etc. with a total support budget of more than VND 165 billion.
2. Results of Corporate Renewal & Restructuring
2.1. Arrangement, consolidation and restructuring of subsidiaries
In 2018, Viettel continued to consolidate its apparatus at all levels, focusing on customer-oriented, flexible, streamlined, creative and professional:
• The Group's agency sector reorganized and properly performed the functions of orientation, support and supervision, creating autonomy for subordinate units; Reorganized the domestic telecoms apparatus by channel, outsource sales activities channel store/point of sale; Established Viettel Business Solutions Corporation to provide overall solutions, digitization and intelligence services for Government organizations and businesses.
2.2. Enterprise Equitization and Investment Divestment
According to the Group Restructuring Plan for the period 2016-2020 approved by the Prime Minister under Decision No. 18/QD-TTg dated March 3rd, 2018, Viettel has no any enterprises on the list to be reorganized and equitized. Viettel has developed a plan to reduce and divest capital with each investment, specifically:
• Reduced capital in subsidiaries from the current holding rate to over 50% of capital until the end of 2020: Viettel Post Joint Stock Corporation (down from 68.08% to >50%); Viettel Consultant and Design Joint Stock Company (down from 68% to >50%); Viettel Construction Joint Stock Company (down from 73.2% to >50%). In 2018, Viettel successfully completed registration for transactions on Upcom for 04 public joint stock companies of the Group, including: Viettel Construction Corporation (Upcom: CTR); Viettel Global Investment JSC (Upcom: VGI); Viettel Post Joint Stock Corporation (Upcom: VTP); Viettel Consultant and Design Joint Stock Company (Upcom: VTK). This was an important first step as a premise for Viettel to expand the opportunity to reduce its ownership rate in companies in accordance with the Plan approved by the Prime Minister.
• Investment divestment Code: In 2018, Viettel completed divestment of all capital at Vinaconex through auction in compliance with regulations. An amount of VND 2,002.4 billion was the total value Viettel has received from the auction, 1.55 times the initial investment value, the profit brought back VND 712 billion, the total value obtained of VND 2,427.2 billion, 1.88 times the initial investment value, a surplus of VND 1,137 billion. It is expected that by the end of 2020 or whenever there is an opportunity, Viettel will divest all of its capital in the remaining two investments: Vinh Son Joint Stock Company and Cam Pha Cement Joint Stock Company.
3. Mission Orientation in 2019
• Consolidated Revenues: VND 251.393 trillion
• Consolidated Pre-Tax Profit: VND 39.34 trillion
3.2. Main missions
a) Administration and Management
• Maintain operation of Viettel 2.0 model: A smart, lean and professional corporation with a customer-centric business model for efficiency. Enhance autonomy for units, the Group focuses on the management of strategy, goals, plans, finance and senior human resources; Monitor the whole Group via the Data Analytics Center and digital transformation.
• Develop strategies and restructure digital products and services within the Group; Establish Viettel Viettel Digital Services Corporation, focusing on Fintech, Digital Marketing and Media fields in the immediate future.
• Focus on developing an important mechanism to create a legal corridor for the Group's business and production activities: Apply for a license to use telecommunications accounts to pay for goods and services of small value; Apply for a license for financial switching and electronic clearing.
• Continue to improve management and monitoring tools: Develop new ERP software for the domestic telecommunications sector; Officially put into operation the performance management and evaluation system; Complete the Dasboard system to monitor production and business activities in the Group.
• Develop a method of performance evaluation and identification of talented people; Synchronously develop policies to retain, train, develop and attract talented people.
• Individual and household customers: Operate a stable and effective channel organization model; Maintain the mobile market share, increase the proportion of 4G subscribers; maintain a leading position in the market for fixed broadband services; Promote digital services, prioritize digital payment; Test 5G services;
• Enterprise solutions: Support digital transformation of organizations and businesses; Prioritize resources for e-Government projects; Implement the National Population Database Project; Smartcity projects with the execution of 22 Provincial People's Committees; Expand sales channels for IT products.
Foreign Telecoms: Promote IT application in operation and management; Continue to optimize costs to improve business performance; Deploy and provide new services, promote the development of e-wallets for the market; Newly develop of 5.6 million 3G+4G subscribers; service revenue of 26% in 2019.
Research, deploy and master new technologies Cloud, AI, Big data, products and services for business; Complete phase 2 of Data Lake system.
c) Production and Research: Put Viettel High Technology Industries Corporation (VHT) into stable and effective operation. Promote business and export products.
d) Traditional sectors: Continue to maintain the growth rate, develop sustainably, reach out to the world, promote the growth of new industries; Organize the operation and exploitation of telecommunications infrastructure to markets; deploy telecommunications and IT sales activities, promote e-commerce business, etc.