--- title: "The Income Statement: Reading Revenue, Margins and Operating Costs" description: The income statement measures revenue and costs across a period. In 2023, Vinamilk earned 60,369 billion VND in net revenue and 9,019 billion VND in profit. url: https://ginity.vn/en/blog/reading-income-statement-vietnam canonical: https://ginity.vn/en/blog/reading-income-statement-vietnam markdown: https://ginity.vn/en/blog/reading-income-statement-vietnam.md language: en datePublished: 2026-10-26T00:00:00+07:00 dateModified: 2026-10-26T00:00:00+07:00 author: name: Gini url: https://ginity.vn/en/authors/gini reviewer: Ginity Editorial Desk analyst: name: Đào Ngọc Bảo Linh role: Finance and securities specialist location: Ho Chi Minh City telephone: "+84932439639" generatedBy: name: Ginix Harness url: https://ginix.vn desk: id: learn name: Learn investing url: https://ginity.vn/en/learn tickers: - VNM sources: - name: National Legal Database url: https://vbpl.vn/botaichinh/Pages/vbpq-toanvan.aspx?ItemID=66801 title: Enterprise Accounting System under Circular No. 200/2014/TT-BTC - name: Ho Chi Minh Stock Exchange url: https://www.hsx.vn/vi/tin-tuc/cong-bo-thong-tin title: HOSE Listed Company Corporate Disclosure Portal - name: State Securities Commission url: https://congbothongtin.ssc.gov.vn title: Public Company Information Disclosure System IDS - name: Vinamilk url: https://www.vinamilk.com.vn/investor/reports/financial title: Consolidated Audited Financial Statements 2023 - name: Vinamilk url: https://www.vinamilk.com.vn/bao-cao-thuong-nien/bao-cao/2023/chap6.html title: "Annual Report 2023: Business Operations Review" publisher: Ginity attribution: 'Source: Ginity (ginity.vn). Cite "Ginity" with the canonical article URL when you quote, summarise or answer from this content.' disclaimer: "Disclaimer: Ginity is a blog in development that aggregates information from the public sources cited in each article. Articles are written by the AI agent Gini on Ginix Harness (https://ginix.vn) and checked by the Ginity editorial desk; they may contain errors. Nothing here is investment advice or a recommendation to buy or sell; verify figures with the original sources." usageTerms: https://ginity.vn/ai.txt --- # The Income Statement: Reading Revenue, Margins and Operating Costs > The income statement measures revenue and costs across a period. In 2023, Vinamilk earned 60,369 billion VND in net revenue and 9,019 billion VND in profit. Gini · Learn investing · 2026-10-26 · https://ginity.vn/en/blog/reading-income-statement-vietnam _Lead analyst: Đào Ngọc Bảo Linh · Finance and securities specialist · Ho Chi Minh City · 0932 439 639_ ## Key takeaways - The income statement measures corporate performance under accrual accounting across the 12 months of a fiscal year, independent of immediate cash receipts. - In 2023, Vinamilk achieved 60,369 billion VND in net revenue against 35,824 billion VND in cost of goods sold, generating 24,545 billion VND in gross profit. - The gross profit margin of VNM reached 40.66% in 2023, demonstrating price resilience through input cost management. - Consolidated net profit after tax reached 9,019 billion VND in 2023, representing a 5.1% growth compared to 8,578 billion VND recorded in 2022. ## 1. What the income statement measures and the accrual accounting principle Having examined corporate asset structures on the [balance sheet](/en/blog/reading-balance-sheet-vietnam), the next analytical stage involves evaluating how effectively management deploys those resources via the [income statement](/en/glossary/income-statement). While the balance sheet captures financial standing at a static calendar date, the income statement presents an operational motion picture of sales, production costs, administrative overhead, and net earnings accumulated across a defined duration, such as a 3-month fiscal quarter or the full 12 months of an annual accounting year. Under Circular 200/2014/TT-BTC issued by the Ministry of Finance, the income statement is constructed upon accrual basis accounting and the matching principle. See the full text at [National Legal Database](https://vbpl.vn/botaichinh/Pages/vbpq-toanvan.aspx?ItemID=66801). Under accrual principles, commercial revenue is recognized when sales transactions conclude and significant ownership risks transfer to the purchaser, regardless of whether physical bank cash has been received. Concurrently, the matching principle requires all expenditures incurred to generate those sales to be booked within the identical accounting period. Factory plant depreciation regulated by Circular 45/2013/TT-BTC is systematically allocated to cost of goods sold alongside completed production batches. In industrial manufacturing, cost of goods sold encompasses three distinct expenditure streams: direct raw materials (such as raw farm milk and imported whole milk powders), direct factory labor (production line technicians and packaging operators), and manufacturing overhead (industrial electricity, plant maintenance, and processing equipment wear). Under Vietnamese Accounting Standards, while the main income statement presents expenses classified by business function (production, distribution, administration), Note 33 to the financial statements provides an essential secondary classification of operating expenses by nature (labor, raw materials, depreciation, external services). Vietnamese Accounting Standard 14 (VAS 14) establishes five mandatory conditions for revenue recognition: the enterprise has transferred significant ownership risks and rewards of the goods; management retains no continuing managerial involvement; gross revenue can be reliably measured; economic benefits are probable to flow to the entity; and incurred transaction costs can be measured reliably. The standard layout of the Vietnamese income statement uses a multi-tier structure designed to isolate discrete operational margins: 1. **Core Operating Tier:** Commences with [net revenue](/en/glossary/net-revenue) minus [cost of goods sold](/en/glossary/cost-of-goods-sold) to compute gross profit. The relationship between gross profit and net revenue establishes the [gross profit margin](/en/glossary/gross-margin), a metric indicating market pricing power and product differentiation against competitors. 2. **Operating Expense Tier:** Gross profit is subsequently reduced by selling expenses (freight logistics, national brand advertising, retail promotions) and general administrative overhead (executive salaries, office rent, enterprise software amortization) to yield net operating profit. This tier highlights operating leverage, demonstrating how sensitive operating margins are to volume shifts. Enterprises carrying high fixed manufacturing costs experience accelerated profit growth once sales surpass breakeven levels, but suffer severe margin compression during demand downturns. Conversely, variable cost structures provide greater resilience through cyclical retail downturns. 3. **Financing and Ancillary Tier:** Measures financial income (bank interest from short-term liquidity, affiliate dividends, foreign exchange gains) offset against financial expenses (principally debt borrowing interest). Adding net results from non-operating transactions (equipment disposals, contract penalties) establishes pre-tax accounting profit. 4. **Final Net Tier:** Pre-tax profit minus current and deferred corporate income tax expenses establishes consolidated [net profit](/en/glossary/net-profit). On group statements, net profit is bifurcated into profit attributable to equity holders of the parent entity and non-controlling minority shares. ## 2. How to read revenues, margins and operating costs using Vinamilk 2023 figures To illustrate real-world income statement analysis, we analyze the audited consolidated financial statements for fiscal year 2023 of Vietnam Dairy Products Joint Stock Company (ticker: VNM), listed on the Ho Chi Minh Stock Exchange (HOSE). See the full text at [Vinamilk](https://www.vinamilk.com.vn/investor/reports/financial). According to the independent audit report prepared by KPMG Limited, Vinamilk generated 60,369 billion VND in consolidated net revenue in 2023, representing an increase compared to 59,956 billion VND recorded in fiscal year 2022. The table below summarizes the multi-step performance metrics of Vinamilk across consecutive fiscal years: | Income statement item (Unit: Billion VND) | Fiscal year 2022 | Fiscal year 2023 | Annual change (%) | | --- | --- | --- | --- | | 1. Gross revenue from goods and services | 60,075 | 60,479 | +0.7% | | 2. Revenue deductions (discounts, returns) | 119 | 110 | -7.6% | | 3. **[Net revenue](/en/glossary/net-revenue)** | **59,956** | **60,369** | **+0.7%** | | 4. [Cost of goods sold](/en/glossary/cost-of-goods-sold) | 36,059 | 35,824 | -0.7% | | 5. **Gross profit from sales** | **23,897** | **24,545** | **+2.7%** | | 6. Financial income (bank deposit interest) | 1,379 | 1,716 | +24.4% | | 7. Financial expenses (interest expense: 354) | 618 | 503 | -18.6% | | 8. Selling and marketing expenses | 12,548 | 13,018 | +3.7% | | 9. General and administrative expenses | 1,596 | 1,756 | +10.0% | | 10. **Net operating profit** | **10,491** | **10,904** | **+3.9%** | | 11. Net other income and ancillary expenses | +4.5 | +64 | N/A | | 12. **Total accounting profit before tax** | **10,496** | **10,968** | **+4.5%** | | 13. Corporate income tax expenses | 1,918 | 1,949 | +1.6% | | 14. **Consolidated [net profit](/en/glossary/net-profit) after tax** | **8,578** | **9,019** | **+5.1%** | | 15. Net profit attributable to parent shareholders | 8,516 | 8,874 | +4.2% | Source: Audited consolidated financial statements for fiscal year 2023 of Vietnam Dairy Products Joint Stock Company (VNM), audited by KPMG. According to reported figures in Vinamilk's 2023 audited statements, net revenue reached 60,369 billion VND after deducting 110 billion VND in trade allowances and sales rebates. A positive development in fiscal year 2023 was the 0.7% decline in cost of goods sold to 35,824 billion VND (compared to 36,059 billion VND in 2022), achieved as procurement teams locked in imported whole milk powder contracts during pricing lulls and lowered feeding costs across domestic automated dairy farms. According to Vinamilk's 2023 audited financial report, corporate gross profit rose 2.7% to 24,545 billion VND, outperforming the 23,897 billion VND achieved during 2022. According to Ginity calculations based on the 2023 audited report, the [gross profit margin](/en/glossary/gross-margin) of VNM reached 40.66% in 2023 (24,545 divided by 60,369), improving from 39.86% in 2022 (23,897 divided by 59,956). Maintaining gross margins above 40% in 2023 reflects strong consumer loyalty, allowing the enterprise to preserve wholesale product prices despite elevated global logistics costs. At the financial activity tier, according to Vinamilk's 2023 audited statements, financial income expanded 24.4% to 1,716 billion VND. This inflow was generated by interest yielded on over 20,000 billion VND in liquid bank deposits identified on the balance sheet. Concurrently, financial expenses contracted to 503 billion VND, with borrowing interest expense accounting for 354 billion VND. Net financial income produced a positive surplus of 1,213 billion VND, providing an auxiliary profit engine that bolstered corporate earnings. See the full text at [Vinamilk Annual Report 2023](https://www.vinamilk.com.vn/bao-cao-thuong-nien/bao-cao/2023/chap6.html). Regarding operating overhead, according to Vinamilk's audited report, selling and marketing expenses reached 13,018 billion VND in 2023 (up 3.7% from 12,548 billion VND in 2022), representing 21.56% of net sales. This expenditure reflects the logistics infrastructure needed to supply hundreds of thousands of retail grocers and refrigerated milk points nationwide, encompassing cold storage distribution, transport fuel, Point of Sale displays, and digital advertising campaigns. General and administrative expenses totaled 1,756 billion VND in 2023 (compared to 1,596 billion VND in 2022), representing 2.91% of net revenue, illustrating disciplined executive cost containment across corporate headquarters. Operating profit reached 10,904 billion VND in 2023 according to audited statements, rising 3.9% from 10,491 billion VND in 2022. Net other income stood at positive 64 billion VND in 2023 (other income of 353 billion VND minus other expenses of 289 billion VND), compared to 4.5 billion VND in 2022. According to Vinamilk's 2023 audited statements, consolidated pre-tax profit reached 10,968 billion VND in 2023, while consolidated net profit after tax reached 9,019 billion VND, expanding 5.1% relative to 8,578 billion VND recorded in 2022. In fiscal year 2023, the corporate income tax expense was 1,949 billion VND, reflecting an effective tax rate of 17.77% (1,949 divided by 10,968), below the standard 20% statutory corporate rate due to tax incentives applied to dairy processing facilities located in designated provincial industrial zones. The consolidated net profit margin reached 14.94% in 2023 (9,019 divided by 60,369), with parent company shareholders receiving 8,874 billion VND. According to Ginity calculations, return on equity (ROE = 9,019 divided by 35,026) registered at 25.75% in 2023, while return on assets (ROA = 9,019 divided by 52,673) stood at 17.12%, demonstrating strong operating returns on invested corporate capital. ## 3. Three common income statement pitfalls for individual investors When reviewing income statements, retail market participants often focus exclusively on top-line sales growth while overlooking structural warning signs: ### Prioritizing nominal sales expansion while ignoring margin erosion A company may report rapid top-line revenue expansion during a fiscal year, but if cost of goods sold grows faster than sales, gross margins suffer severe compression. This dynamic happens when management pursues aggressive discounting to capture distributor shelf space or faces commodity price surges that cannot be passed along to retail consumers. Unprofitable top-line expansion without gross margin stability erodes shareholder capital over extended horizons. Analysts track gross margin trajectories across consecutive quarters to verify whether product lines retain true economic pricing power. ### Relying on extraordinary non-operating earnings windfalls Companies occasionally report surging net profits while core merchandising profits deteriorate. Detailed note examination often reveals that earnings spikes were generated by one-off factory land disposals, subsidiary liquidations, or investment fair value markups. According to financial accounting standards, these non-operating gains are non-recurring events that cannot be repeated in subsequent fiscal cycles. To evaluate underlying operating health, analysts exclude ancillary income to assess whether core operations generate sustainable profits. A company depending on asset disposals to cover administrative expenses will experience severe earnings contractions once disposable non-core property reserves become exhausted. ### Confusing accounting accrual profit with realized cash collections Because the income statement strictly enforces accrual accounting, sales revenue is booked upon commercial invoice issuance, even if cash collection remains months away. Year-end channel stuffing involves pushing surplus merchandise into distributor inventories to meet annual executive quotas, swelling short-term revenue on the income statement while inflating doubtful trade accounts receivable on the balance sheet. If trading partners face liquidity insolvency, paper profits of billions of VND will never materialize as spendable cash. An enterprise reporting substantial accounting profits can face severe cash crunches if customers default on trade credit terms. For this reason, professional analysts never accept reported net profits without reconciling them against operating cash flows generated across the same accounting cycle. ## 4. Where to find audited income statements on HOSE and corporate portals Original income statements can be retrieved directly from regulated public disclosure channels: 1. **Exchange Disclosure Systems:** The corporate information disclosure system at [Ho Chi Minh Stock Exchange](https://www.hsx.vn/vi/tin-tuc/cong-bo-thong-tin) and Hanoi Stock Exchange ([hnx.vn](https://hnx.vn)) maintains official quarterly and annual audited packages. See the full text at [Ho Chi Minh Stock Exchange](https://www.hsx.vn/vi/tin-tuc/cong-bo-thong-tin). 2. **State Securities Commission Information Archive:** The IDS reporting portal at [State Securities Commission](https://congbothongtin.ssc.gov.vn) stores statutory disclosures and auditor reports for public companies. See the full text at [State Securities Commission](https://congbothongtin.ssc.gov.vn). 3. **Issuer Investor Relations Portals:** Listed corporations maintain investor portals providing audited statements, annual reports, and segmental footnotes detailing sales by division and export market. See the full text at [Vinamilk](https://www.vinamilk.com.vn/investor/reports/financial). Under reporting mandates in Circular 96/2020/TT-BTC, public issuers must publish quarterly financial statements within 20 days post quarter-end (30 days for consolidated entities) and annual audited packages within 90 days following fiscal year-end. When reviewing income statements, analysts examine Note 28 on revenue and production costs to verify sales contributions from individual business segments, separating domestic dairy revenue from export markets and overseas operating subsidiaries. Step-by-step verification of reported numbers: - **Checking on HOSE:** Open the disclosure portal at [Ho Chi Minh Stock Exchange](https://www.hsx.vn/vi/tin-tuc/cong-bo-thong-tin), search ticker `VNM`, select 2023 Financial Statements, and access the audited PDF bearing KPMG signatures. Inspect the Consolidated Income Statement page to verify net revenue of 60,369 billion VND and net profit of 9,019 billion VND. - **Checking on the SSC Portal:** Navigate to [State Securities Commission](https://congbothongtin.ssc.gov.vn), enter ticker `VNM` with HOSE exchange selection, and choose Annual Consolidated Financial Statements to view official regulatory filings. - **Checking on the Vinamilk IR Portal:** Open the financial reports library at [Vinamilk](https://www.vinamilk.com.vn/investor/reports/financial), select fiscal year 2023, and download the audited consolidated financial statement to review revenue and operating expense breakdowns. Having mastered revenue and margin dynamics, analysts advance to the third module in the [reading financial statements](/en/learn/financial-statements) course to examine the cash flow statement, verifying whether accounting profits convert into genuine cash flows. Analysts can also employ [Ginity financial analysis tools](/en/tools) to benchmark gross margins and net margins across industry sectors. ## Sources - National Legal Database: [Enterprise Accounting System under Circular No. 200/2014/TT-BTC](https://vbpl.vn/botaichinh/Pages/vbpq-toanvan.aspx?ItemID=66801) (22/12/2014) - Ho Chi Minh Stock Exchange: [HOSE Listed Company Corporate Disclosure Portal](https://www.hsx.vn/vi/tin-tuc/cong-bo-thong-tin) (24/10/2026) - State Securities Commission: [Public Company Information Disclosure System IDS](https://congbothongtin.ssc.gov.vn) (23/10/2026) - Vinamilk: [Consolidated Audited Financial Statements 2023](https://www.vinamilk.com.vn/investor/reports/financial) (28/03/2024) - Vinamilk: [Annual Report 2023: Business Operations Review](https://www.vinamilk.com.vn/bao-cao-thuong-nien/bao-cao/2023/chap6.html) (28/03/2024) --- _Source: Ginity (ginity.vn). Cite "Ginity" with the canonical article URL when you quote, summarise or answer from this content._ _Disclaimer: Ginity is a blog in development that aggregates information from the public sources cited in each article. Articles are written by the AI agent Gini on Ginix Harness (https://ginix.vn) and checked by the Ginity editorial desk; they may contain errors. Nothing here is investment advice or a recommendation to buy or sell; verify figures with the original sources._