Group Chairman

Dear Shareholders,

The transformation of KIDO Group from confectionery to the daily essential food category has achieved remarkable results. The robust growth in both revenue and profits in 2017 is proved to be a breakthrough and has affirmed the capability, value reputation and strategic vision of KIDO Group in the consumer market. 2017 was a turning point for the Group and witnessed positive changes in the integration of the different business units into KIDO Group. This process was extremely successfully thanks to strong efforts of everyone and support of the shareholders, investors, consumers and partners.

Frozen Foods Segment

The Bac Ninh Factory was completed and put into operation which has helped KIDO Foods to expand its production capability and penetrate into the northern market. This was considered a strategic step to enhance the distribution system as well as to target the ambient and packaged foods market. By leveraging the wide distribution channel of 70,000 frozen and chilled point of sales, our frozen foods segment continued to expand into the ambient and chilled foods which has effectively supported us in the goal of dominating the Vietnamese household’s kitchen.

The process of expanding categories and scaling is not easy. The act of maintaining the leading position and increasing market share for the ice segment to reach 40.2% affirms our continuous efforts. KIDO Foods also celebrated a milestone in journey by going public and listing its shares to be traded on the UPCOM. The underlying reason for taking KDF public was not only about diversifying the shareholder structure, attracting the strategic investors, domestic and international investment but also creating the opportunity for investors to have a variety of choices in directly investing in specific business of the Group.

The ambition of KIDO Group is to be present in the ambient, chilled and frozen foods segment. Therefore, we acquired a 50% equity interests in DABACO Foods Processing Co., Ltd – a business unit which has production capability in processed foods. With the competitive advantage of 3F (Feed, Farm, Food) and technology capacity of our partner; coupled with our wide distribution channel, marketing and financial resources of KIDO Group, we will maximize our competitive advantage position in the market and create the opportunity to expand our cooperation in this field.

Daily Essential Segment

The year 2017 saw several outstanding changes for Tuong An as its profit grew by 98% versus 2016. This was a proud achievement for us which marked a very special occasion for the company which also celebrated its 40th anniversary. The symbol of the red elephant represents the persistent and robust life of our brand. This brand is characterized for high quality and has been a familiar presence with the Vietnamese household’s kitchens for many generations. The results of Tuong An are due to the team as well as KIDO Group who both persevered through the process of improving, enhancing the operational efficiency, restructuring the product categories and diversifying the product portfolio which was targeted at serving consumers high quality products as part of the family’s meals. Tuong An also focused on exploring cooperation activities with various partners to expand it’s position in the market. Thanks to the support from KIDO Group, Tuong An partnered with TTC to distribute refined sugar and other partners to distribute instant noodle. Moving forward, we will also expand to other essential foods such as sauces, spices, etc.

Export, Industrial and Distribution Channels

KIDO Group completed to raise its stake at the Vietnam Vegetable Oils Industry Corporation – Joint Stock Company (VOC) from 24% to 51% in May 2017 and Vocarimex officially became a member of the Group. As a leading player in its field, VOC holds a crucial role in the value chain of the Group. VOC is the key element in helping us conquer the essential foods market. With strong internal resources such as supply chain management, exporting and importing activities, warehousing and especially competitive advantages in industrial oils, VOC characterizes a strong platform for KIDO Group support other members in the Group. KIDO Group continues to support VOC in terms of restructuring the operational system improvements, planning and designing the business model to focus on industrial and export clients.

From a single basket of goods toward a VND 250,000 Billion market

Despite the increasing competition, daily essential food’s market size is expected to reach VND 250,000 billion in 2018. To realize our goal of becoming the leading food corporation in Vietnam and expanding to other countries, we have many challenges to overcome, and will need the cooperation, support from our partners, shareholders and customers.

The success of KIDO is the result of pursuing a strategy of connecting with consumers. Beside a strong financial position, product innovation ability and a strong execution platform, KIDO has always focused on the needs of consumers at the center of all activities. We consider the needs and taste of the Vietnamese consumer as the basis for our development. KIDO Group’s goal is to maximize our share of the consumer’s basket of goods by choosing and delivering high quality products that meet the need of consumers throughout the day. In addition, we are improving our distribution channel to ensure the delivery of our products to the consumers. Our Group’s priority is to work closely with the strategic partners to make sure that consumers will choose our quality products to achieve the highest level of satisfaction.

KDC – maximize value and ensure sustainable growth

In the first phase, beside our mission to consumers, customers, communities and society, we have defined our mission to shareholders and investors by achieving maximum value for shareholders, and minimizing risks to create stability, confidence and consistent return on investments.

Our commitment has been realized over many years evident through our dividend policy. This continues to require KIDO Group to maintain its revenue growth rate, profitability and financial efficiency. Our subsidiaries have to focus on the most important issues to create value, ensure a balance between benefits and growth. We are committed to implementing all strategic activities effectively to provide shareholders, investors with consistent and stable dividends in the long-term.

Currently, with the participation of three subsidiaries listed on the stock exchange, KIDO has achieved scale in terms, production capacity, operations and management. There are still many challenges in the process of developing TAC, KDF and VOC with KIDO Group’s strategy. However, with our market knowledge, strong financial position, and managerial capabilities, KIDO will continue to support our member companies who are preparing for the next stage of development. We will accelerate the process of expansion and penetration into other daily food categories through M&A activities, cooperation, joint ventures, and partnerships.

It is this that fuels my confidence in our strategic goal of becoming the best daily essential food group in Vietnam and we will be able to complete this faster than expected.

To our stakeholders, we are proud of the achievements over the past periods and I believe that the support of our shareholders is the key motivation for our Group. We are confident in executing our strategy and achieving strong growth rates during this transformation phase. On behalf of the Board of Directors, I express my gratitude to our shareholders, investors, consumers, partners and team for their continuous support of KIDO Group.

We wish you a prosperous year, full of health and happiness and we hope that our cooperation will be fruitful and successful.


Group Chairman