Central Vietnam Building Materials Company: 10 years of privatization, construction, and development.

(Baonghean) - With the motto "Cencom for sustainable development," over the past 10 years, the Central Vietnam Construction Materials Company has made remarkable progress to bring revenue and prosperity to the company as well as each shareholder. Above all, in every service the company provides to the community, the goal is to be a reliable partner for its customers.

Headquarters of Central Vietnam Construction Materials Joint Stock Company

Vinh Construction Materials Trading Enterprise is a unit directly under Viet An Import-Export and General Services Company, a state-owned enterprise under the Provincial People's Committee. In accordance with Decree 41/CP dated July 6, 1995, with the agreement of the parent company's leadership and Decision No. 4819/QD/UB.DMDN dated December 16, 2004 of the Provincial People's Committee on the equitization of Vinh Construction Materials Trading Enterprise, 100% of state capital was sold to enterprise officials under the name Central Construction Materials Joint Stock Company (abbreviated as CENCOM). With the motto "Cencom for sustainable development".

In the early days of establishing the company under the new economic management model, like many other businesses, the company faced numerous difficulties. Everything about management was new and unfamiliar, and the Board of Directors did not fully understand the concepts and their significant responsibilities. In addition, the company faced extremely difficult and limited finances, with only 1.5 billion VND in registered capital raised from employees, lacking the qualifications and confidence to secure business loans from banks. Under immense pressure from shareholders and employees to provide jobs and income for survival, and with 50 people lacking experience in new economic management while the economy and society were still underdeveloped, this was truly a major challenge for the Board of Directors and the Management Board during their first three-year term.

Faced with countless difficulties, the Party Committee, Board of Directors, and Management Board of the company determined that self-reliance and self-strengthening were essential, and first and foremost, unity among all founding shareholders was crucial. Overcoming all obstacles to conduct business, they focused on the core business of building materials production and trading, a sector in which the company had experience and market access, supported by a dedicated and hardworking workforce familiar with the industry, a testament to the resilience of the subsidy era.

Based on that policy, the company focused its business development on the cement distribution system in Nghe An province, specifically Nghi Son Cement and Hoang Mai Cement. Having become an official distributor since 2000, the company identified two main market segments for cement consumption: residential use through retail stores and consumption through industrial projects, with transportation infrastructure projects as the core, primarily involving construction corporations building bridges, roads, and airports.

In response to the Board of Directors' policy in the initial business direction of the first term, the company was forced to separate and establish two basic business departments: a cement distribution department specializing in the civil construction segment and a project economics department specializing in managing transportation projects nationwide. Simultaneously, the company focused on building a customer strategy with large corporations possessing strong transportation construction capabilities and sound finances, such as Corporation 4 and Corporation 1.

Based on those directions during the first term (2005-2007), the company achieved certain results and laid the foundation for the second term. This included sufficient and regular employment for 70 workers, stable income, and dedicated employee shareholders. The company began expanding its services and supplying raw materials to the market. During the first term, the company was profitable, achieving revenue of 533 billion VND over three years, after-tax profit of 1.95 billion VND, and tax payments of 520 million VND. Equity increased from 1.5 billion VND to 4.5 billion VND, with an average dividend of 15% per year. From this point, the company also began investing in equipment and vehicles for internal transportation.

Faced with the challenging economic and social situation of the country at this time, but with the increasingly urgent need for national development, infrastructure construction, and the development of the road transport sector, the Board of Directors decided to invest heavily in supplying materials for transport projects such as bridge and road construction, airports, and hydroelectric power plants in suburban areas. High-value contracts were signed, such as the material supply contract for key national bridge projects under CIENCO 4 in the North, South, and Central regions. These included projects for airports such as Vinh Airport (Phase 1), Dong Hoi Airport, Da Nang Airport, Phu Cat Airport, and several other military airports constructed by ACC Company under the Air Defense and Air Force Command. As a result, the company's brand has been strengthened, and it is gradually becoming a leading nationwide supplier of cement, with a total output of 2,740,000 tons. Average production of 550,000 tons/year, revenue: nearly 3,000 billion VND, averaging 600 billion VND/year. Equity capital: reached 25 billion VND by the end of the term, a 17-fold increase compared to the beginning. The workforce increased from 57 people to 97 people.

After concluding its economic endeavors during its second term, the company has essentially achieved several key targets in its business strategy and corporate management orientation. The company has built a reputable brand nationwide in the cement business, becoming the largest cement distributor in the country, reaching nearly 1 million tons in the final year of the term. It received the Nghi Son Cement Company's rotating award for three consecutive years (2011-2013) and has been the largest consumer of Hoang Mai cement since the factory's inception. Its distribution system for civil cement has developed strongly in Nghe An province, boasting the widest coverage, the most stores, and the highest sales volume for both the Nghi Son and Hoang Mai factories. The company has built and connected a strong customer base within major corporations to supply materials for large-scale transportation projects nationwide, demonstrating proactive and synchronized resources and finances. The company has accumulated and built a solid and secure financial foundation. It has equity capital of nearly 30 billion VND and total assets exceeding 100 billion VND. The company has invested in a robust transportation system, including specialized vehicles for transporting bulk and bagged cement nationwide. It has also fostered strong internal unity within the company, from leadership to shareholders and employees.

Faced with new economic challenges, the company's Board of Directors had to reconsider its strategy: should it stop for safety or continue its current situation, leaving over 100 workers unemployed and with low incomes? Through the efforts of the Board of Directors, the Management Board, and the solidarity of shareholders and employees, the company took advantage of the opportunity presented by inactive businesses to assess the market. Simultaneously, efforts were made to ensure wages for employees during difficult times and to share work opportunities. As a result, in 2013 and 2014, the company overcame these difficulties and set a better development direction than in its second term. At the end of 2013, the market situation for construction in Vinh City and its surrounding areas changed.

Regarding the use of ready-mix concrete, the company decided to cooperate with the technical department of Nghi Son Cement Company and the Nghi Son Cement Office in Hanoi to invest nearly 40 billion VND in a Nghi Son 320 ready-mix concrete plant in Truong Thach Industrial Park - Cua Lo, built to Japanese standards. The plant was completed within 5 months of investment and began operations in early January 2014, achieving business results beyond expectations, producing 60,000 m3 of concrete in 2014 compared to the planned 25,000 m3. Its quality and reputation have been approved by key projects such as: the National Highway 46 railway project, the Vinh Airport upgrade project (constructed by Cienco4); the Quan Banh railway overpass project (constructed by Thang Long Corporation), and many other projects and residential areas in the province.

This was the most successful investment policy of the past year. In addition, since 2013, the company has expanded its business scale in terms of land and warehouse systems; acquired a defunct business to establish a subsidiary; continued to invest heavily in production and business; and the company has become increasingly modern with nearly 200 employees having jobs and decent incomes. As a result, in the first two years of the third term (2013-2014), with revenue of 1,900 billion VND, an average of 950 billion VND/year, and a profit of up to 11 billion VND; average income of 7,000,000 VND/person/month, and dividends of 15%/year.

After 10 years of dedicated effort, the company's Board of Directors and employees are immensely proud of the achievements. Company leaders stated: "This success is thanks to the Board of Directors and the Management Board throughout the years who have seized opportunities and favorable circumstances, and above all, the unity and solidarity of all shareholders and employees in steering the Cencom ship towards happiness and prosperity."

After 10 years of construction and development, the company's shareholders consider its greatest success to be the leadership's role in building a strong and united organization. Shareholders and employees enjoy a democratic, open, and transparent working environment, and the lives of employees are steadily improving. Furthermore, nearly 200 employees are secure working in a positive, cultured, disciplined, and well-organized environment with stable incomes. In addition, the company has also focused on social responsibility, such as supporting the islands and coastal areas with the Vinh City Party Committee, People's Council, and Fatherland Front, donating 74 million VND to visit and present gifts, and contributing 100 million VND to build charitable houses in the city, as well as other initiatives aimed at social responsibility and promoting public awareness.

And, the motto of building a sustainable future is what the company is pursuing and striving for in the future.

Vo Trong Son