Introduction

Along with the development and integration of the global economy, Vietnam is
gradually innovating and entering the period of industrialization and modernization, both
to build infrastructure and develop economy. Therefore, our State as well as local
agencies has paid a lot of attention in it. Construction also plays a vital role in economic
growth and development.
Mechanical Construction Company No. 1, under Civil Engineering Construction
Corporation No 1 JSC, is one of the outstanding units of the sector and a trustful
partner of the domestic and foreign customers. The company has a huge contribution to
the development of our country.
During the internship time, with the help of the managers and colleges in the
company, I have collected enough information to complete my report.
Through my internship report, I hope to present a general formation about the
establishment, development, organizational structure, business activities, as well as some
problems existing in the business activities of the company which I have studied before.
I would like to express my gratitude towards the teachers at English Department
Vietnam University of Commerce as well as my managers and colleges in MCC1.
Especially, I would love to express my sincere thanks to my supervisor MA. Ha Thi Vu
Ha who has helped me a lot to complete the report. I look forward to receiving comments
and suggestions in order to perfect the paper.
Hanoi, February

2015

Student
Le Thi Lien

PART 1: OVERVIEW OF MECHANICAL CONSTRUCTION COMPANY NO.1

1.1.

The information and development of the company

1.1.1. Overview of Civil Engineering Construction Corporation No 1 JSC (CIENCO1)

Civil Engineering Construction Corporation No 1 JSC which was established in
1964 is one of the leading businesses about construction in Vietnam.
Through 50 years of development, (1964-2015) CIENCO1 has built a powerful
force including over 40 member units, a school of training technical workers and 3
affiliates (Ho Chi Minh City, Highland, Cambodia) with more than 9,000 officers and
employees. Corporation was also awarded the Medal of Ho Chi Minh, the title of Hero of
the Peoples Armed Forces, 10 independent medals, 5 individuals are Labor Hero, 7
projects were granted Gold Medal for high quality.
Some constructional works of typical bridges, ports, roads, railways of Corporation
recently as follows: Rach Mieu Bridge, Rong Bridge Da Nang City, Tran Thi Ly
Bridge, Vinh Tuy Bridge, Port exports to products of Dung Quat Dung Quat Oil Refinery,
Sai Gon Trung Luong Highway, Noi Bai International Airport, Road No. 78 Cambodia,
Ring Road No. 3 Hanoi- Period. 2, etc.
1.1.2. Mechanical Construction Company No.1.
1.1.2.1. Information about the company
Full name: Cng ty Thi cng c gii I
English name: Mechanical Construction Company No.1
Abbreviation: MCC1
Address: 7th floor, No. 623 La Thanh Road, Thanh Cong Ward, Ba Dinh District,
Hanoi City.
Tel: 04.37725383
Fax: 04.37720925
Website: www.mcc1.com.vn
Email: cienco1mcc1@gmail.com

1.1.2.2. Formation and development of MCC1

Mechanical Construction Company I - formerly known as Mechanical Construction
Enterprise No 1 is one of the units under Civil Engineering Construction Corporation
No 1 JSC. The company was established on August 15 th 2011 according to Decision
No. 509 / DOP LD.
On February 26th 2003, Mechanical Construction Enterprise No 1 was renamed
Mechanical Construction Company I according to Decision No. 502/ 2003/ Q-BGTVT
of Ministry of Transport.
With the goal of sustainable development, the company has preferred train labor
force, focused on investing and exploiting the potential of equipment and construction
materials, and applied science and technology in the production and management.
Besides, the company constantly expands the business scale, business sectors, workforce
increased in quantity, quality and professional qualifications which meets better the needs
of customers. The companys slogan is Productivity - Quality Efficiency.
Until now, MCC1 has become one of the most professional contractors in term of
mechanical construction in Vietnam, and a trustful partner of foreign customers.
Some typical constructional works: Rach Mieu Tien Giang Bridge, Tan An Long
An Bridge, Vinh Tuy Bridge, My Thanh Bridge
1.2. Major business areas of the company
MCC1 operates in multiple fields:
- Build constructional works of foreign and domestic civil engineering
-

Build constructional works of civil and industry (Irrigation, Defense,

Electronics)
- Transport materials, equipment, components to serve for execution
-

Excavate soil, ground leveling

Produce and trade constructional materials, precast concrete components, steel

bridge beams, mechanical products

-

Fix auto machine, construction equipment

Execute the projects supplied by CIENCO1.

1.3. Organizational structure and management

1.3.1. Organizational Chart of MCC1
Quang
Representative office in Ho Chi Minh
City Minh Mechanical workshop
Warehouse of the Company
1st PA Board
Construction Teams No.1
Personnel Dept

2nd PA Board
1st PA Board
Construction Teams No.2

Accounting Finance Dept

2nd PA Board

1st PA Board
Construction Teams No.3
2nd PA Board
Construction Engineering Dept
1st PA Board
Construction Teams No.4

Board of Directors

2nd PA Board
Planning Dept

1st PA Board
Construction Teams No.5
2nd PA Board

Equipment and Material Management Dept

1st PA Board
Construction Teams No.6
2nd PA Board
Construction Teams No.71st PA Board
Quality Management Dept
2nd PA Board
Construction Teams No.81st PA Board
Market Dept

2nd PA Board
Construction Teams No.91st PA Board
2nd PA Board

Chart 1: Organizational structure of MCC1

1.3.2. Function, responsibilities of management department.

Board of Directors (Director and Deputy Directors)
Director: As the representative of the company, with the highest authority,
responsible for all business operations of the Company. Director defines functions and
responsibilities of key personnel; makes decisions about projects and business plans,
organize the executive apparatus, shares profit, distributes profits to fund the
Companys budget.
Deputy Directors: Assist the Director to manage and executive one or several
tasks assigned by the director. Director assign a deputy director take over one or some
areas of activity of the Company (Have a specific assignment)
Personnel Dept:
Advise the Director to provide human resources meeting the requirements of
business production, coordinate employers, implement the planning of training,
improve qualifications for officers and employees , monitor and address the policy
regime for employees, manage the administration, organization and foreign relations
etc ...
Accounting Finance Dept:
Organizes the financial and accounting apparatus of the company, establishes
records, reports accounting data, closely manage the funds and ensure that they are
used properly and effectively, analysis business operations and submits the Director
timely to work out appropriate measures to accelerate the process of construction.
Construction Engineering Dept:
Advises the Director on the work of construction engineering and has tasks such
as: sets up construction process, monitors the volume and quality of constructional
work, receives the volume of work completed periodically, supervise engineering of
work, sets up construction organization plan

 Planning Dept
Advices the Director to draw and sign economic contracts, build business
production plan annually; monitor and supervise the business manufacturing and the
implementation of projects annually; develop plans of labor norms, salaries, supplies
for each work item; analysis of economic activities to assist the Director made the
right decision.
Equipment and Material Management Dept
Manages and runs the use and maintenance of motorcycles, equipment; builds
plan of using, managing equipment and materials; organize warehouse and supplies
storage. Besides, this Dept also consults in procurement organization, materials
preservation for the activities of the Company.
Quality Management Dept
Supports Directorate to build, manages and develops the quality management
systems; supervises and inspects the construction stage; organizes research, evaluates
to improve the quality
Market Dept
Responsible for searching market, domestic and foreign customers; bases on the
ability of firms and markets to establish the appropriate bid to help company win
contracts, and construct efficiently and advise the Director to sign the contract; links
with other businesses to provide products,
Construction Teams
Advises the Director in the field of construction; builds plans for implementing
the assigned work; performs construction work in accordance with the approved
technical documents, and companys plan; ensures product quality, timely completion;
manages motorbikes, equipments, labor supplies in accordance with the statutes of the
company.

PART 2: BUSINESS RESULTS ANALYSIS OF MECHANICAL CONSTRUCTION

COMPANY NO.1
2.1. Core markets, products and services of the company
2.1.1. Characteristics of the product
MCC1 is one of the companies under CIENCO1, its main field is bridge and
port construction. The main products are construction products, transport, industrial
and civil works. They have following characteristics:
- Construction products are works and large building which have complex
structures, single units, prolonged duration and dispersion. Before construction,
they have been estimated about design and construction.
- They have large investment capital and prices depend largely on input
- Construction products completed cannot be saved in warehouse but be
delivered right to the customers in accordance with price agreements or
contractors before.
- The product is fixed at a place, where products are built and consumed.
The facilities, construction equipment, workers must often move to the location of
the product which causes difficulties for the management. Products are directly
affected by natural conditions so easily lost or damaged.
Besides, the company also manufactures and trading of building materials,
mechanical materials provided for the construction of their own works and other
companies in the field of domestic and international markets.
2.1.2. Core markets and partners
Since its establishment, the company has had lots of developments of all aspects,
the works of company not only increases in number, but also ensures the technical and
aesthetic requirement. Therefore, the company's markets expand not only nationally
but also the international market.

Currently, the company has many business partners in all provinces of the
country, especially in Hanoi, Da Nang, Ho Chi Minh, Hue, Thanh Hoa, Kien Giang,
Can Tho, Ca Mau ...
The company's main customers include
- The department of project management and construction works managed by
city administration
- The department of project management and construction works managed by
the State, the Ministry of Transport.
- Businesses, agencies and organizations operating in the same field, sector
In addition, the company is gradually expanding into international markets
through the implementation of projects of corporations and trading products of
building and mechanical materials.
2.2. Business situation analysis of the company in two years 2012 and 2013.
2.2.1. Business results analysis
Operation situation of a company is best expressed in the system of declaration
board, books and its financial statements. Data in this report provides the most
comprehensive information about the use of capital and human resources as well as
the results of the sales and profits that the company achieved.
Here is the situation of production activities of the company in 2012 and 2013:

Table 2.1: Reporting the results of operations of MCC1 in 2012 and 2013
Expenses

1. Revenues from sales of goods

and services
2. Cost of sale of goods and
services
3. Gross profit from sales and
services
4. Revenues from financial
activities
5. Financial expenses
6.Enterprise Management
expenses
7. Net profit from operations
8. Other incomes
9. Other costs
10. Other profits
11. Profit before tax
12. Business income tax expense
13. Profit after tax

2012

2013

Difference
Increase
Ratio
(decrease)
(%)

1,282,174,918,443

1,227,881,289,501

(54,293,628,942)

4,23%

(1,213,983,020,436)

(1,168,436,106,370)

(45,546,914,066)

3,75%

68,191,898,007

59,455,183,131

(8,736,714,876)

12,81%

1,932,712,044

1,779,210,761

(153,501,283)

7,94%

(20,355,004,849)
(34,699,374,093)

(16,941,324,940)
(30,262,956,246)

(3,413,679,909)
(4,436,417,847)

16,77%
12,79%

15,070231,109
32,404,237,128
(23,406,675,719)
8,997,561,409
24,067,792,518
7,456,237,809
16,611,554,709

14,020,112,706
11,348,422,101
(9,291,971,510)
2,056,450,591
16,076,563,297
5,579,234,621
10,497,328,676

(1,050,118,403)
(21,055,815,027)
14,114,704,209
(6,941,110,818)
(7,991,229,221)
(1,877,003,188)
(6,114,226,033)

6,97%
64,98%
60,30
77,14%
33,2%
25,17%
36,81%

Source: Financial Report 2012, 2013 - Department of Finance and Accounting

Mechanical Construction Company NO.1
Looking at the statement of operations of 2years 2012 & 2013 we can see the
company make profit but revenue and profit in 2013 was lower than in 2012 (revenues
decreased 54,293,628,942 VND equivalent to 4.23%, net profit fell 6,114,226,033VND
or 36,81%).

 Revenues and Structure

Table 2.2: Revenues structure in 2012 and 2013
Structure
- Revenues from construction
work
- Revenue from selling and
exporting
materials
and
equipment
- Revenues from financial
activities
Total revenues

2012
1,219,452,692,21 94,97
0 %

2013
1,163,647,126,76 94,63
0 %

62,722,226,233 4,88%

64,234,162,741 5,23%

1,932,712,044 0,15%
1,284,107,630,48 100%
7

1,779,210,761 0,14%
1,229,660,500,26 100%
2

Source: Financial Report 2012, 2013 - Department of Finance and Accounting

Mechanical Construction Company NO.1
Total revenues in general and revenues of each particular part in 2013 was lower
than in 2012, suggesting that the business operations of the company in 2013 was not as
effective as in 2012.
About the structure of revenue in two years, revenue from the construction works
accounted for a large proportion (greater than 94%), this is the main activities of the
company. However, the proportion of revenue from the sale and export of goods in 2013
(5.23%) higher than in 2012 (4.88%) proves the company had started to focus more on
this field, and partly because the company promoted the export of materials and
equipment to international markets more.
Capital and structure
Cost of sales and service delivery fell 3.73% in 2013 compared to 2012, due to a
number of works with the execution time lasted from 2012 to 2013, the initial investment
was calculated in 2012. The number of new buildings was not many, this is also the
reason why revenues, costs and profits decrease.
About the capital structure

Table 2.3: Capital structure in 2012 and 2013

Structure

2012

2013

1 Liabilities

559,000,889,388

96,6%

571,420,533,380

2. Equity
Sub total

19,681,161,589
578,682, 051,247

3,4%
100%

19,681,161,589
591,101,695,239

98,75
%
1,25%
100%

Source: Financial Report 2012, 2013 - Department of Finance and Accounting

Mechanical Construction Company NO.1
According to the table, the source of the companys equity accounted for a very low
rate (3.4% in 2012 and 1.25% in 2013). Moreover, the proportion of equity in 2013 also
decreased compared to 2012 due to equity fall but liabilities increased.
Cost and structure
The costs including financial cost, enterprise management expenses and other
expenses are reduced. The amount of capital invested in sale activities and services
reduced, so Financial expenses decreased (16.67%). Enterprise management expenses fall
12.97% proving the company has removed unnecessary existences in organizational
structure. Other expenses include expenses from the sale of scrap materials, reasonable
asset liquidation expenses, costs of rental equipment ... also reduced a significant amount.
Profits and structure
Both in 2012 and 2013, companys profits was positive (VND 16,611,554,709 and
10,497,328,676 VND in 2012 and 2013 respectively), so the business activities of the
company made profit. However, profitability is not high due to high cost of sales and
other expenses. Revenue from construction works accounted a large proportion but profit
from that got low proportion. In addition, the profit after tax of decrease 36.81% in 2013
compared with 2012.
Based on the above analysis we can see, production and business activities of the
company in both 2012 and 2013 made profit, however, the growth was negative due to

many objective reasons. So in the coming years the company should take measures to
save costs, reduce prices in order to contribute to improving profitability, growth.
2.2.2. Labor and labor structure
MCC1 always focuses on investing in human development. Staff and employees are
trained regularly to improve professional qualifications and entitled to reasonable
remuneration. Besides, companies are facilitating technical facilities and machinery so
that officers and employees have a favorable working environment, most comfortable in
order to raise labor productivity.
In 2013, total number of employees of the company is 819 people (compared to
2012 with 885 people). In which the number of officers and employees have graduated
from college and graduate education is 763, accounting for 93.16%. Number of
employees under age 35 is 682, accounting for 83.27%.
With young and highly qualified professional staff, the company is committed to
bringing their customers the attention, attentive service and high quality products.
2.3. Evaluation and comments on the strengths and weaknesses of business activities
of enterprises
2.3.1. The strengths
Since being established and experienced 13 years of development, the company has
confirmed its position and its reputation in the market.
The company is under the Civil Engineering Construction Corporation No 1 JS one of the leading units in the construction sector, under the Ministry of Transport, so it
regularly receives many large projects delivered from the Corporation, especially
international and foreign investment projects.
Moreover, not only having the experienced and enthusiastic staff, the company also
has a team of young officers who has been formally trained, dynamic. Management staff
have a high level of expertise, capacity, working with high sense of responsibility.

The scale and scope of business activities is relatively wide, across the whole
country and is gradually expanding into international markets.
Machineries are modern and ensure the process of construction, high
competitiveness.
The construction works are certified quality assurance.
2.3.2. The Weaknesses
The company has not optimized business costs, financing costs and used capital
effectively, thus operating profit had lower proportion than revenue.
It has also not achieved stable growth.
Moreover, marketing activities and market searching have not been promoted yet,
large projects are mainly due to the delivery from the Corporation.
In addition, the operations of selling, exporting materials, construction equipments
and mechanical equipments has not been focused. Revenues were mainly from the
construction of transportation projects, bridges and port.
The country is entering international integration, however, the number of
international projects and foreign investment of the company is very low. Therefore, the
use and requirement about English in the company is still very limited, many employees
are not proficient in English as well as in international trade transactions.