Aquatic companies’ profits in the first quarter hurt by COVID-19 epidemic

Update: 16:46 | 05/05/2020
Fishery enterprises’ first-quarter profits were hit hard due to the negative impacts of the COVID-19 outbreak.
TIN LIÊN QUAN
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Tra fish processed at Vinh Hoan JSC. The company’s after-tax profit in Q1 decreased by 51 percent to touch VND152 billion.(Photo: tinnhanhchungkhoan.vn)

According to the General Department of Customs, seafood export turnover in the first quarter of 2020 reached over 1.61 billion USD, down 9.9 percent compared to the same period in 2019.

The Cuu Long Fish JSC (ACL) reported post-tax profit down by 98 percent to just over 1 billion VND (43,550 USD), the lowest profit the company has recorded in the last four years.

As of March 31 this year, ACL's total assets stood at 1.4 trillion VND, a slight decrease of 3 percent compared to the beginning of the year.

Inventory amounted to nearly 721 billion VND, up 14 billion from the beginning of the year, and accounted for over 50 percent of total assets.

This year, ACL expects to collect only 1.35 trillion VND in revenue and 75 billion VND in pre-tax profit, down 5 percent and 53 percent compared to the previous year.

According to ACL’s leaders, this year posed many challenges for Vietnam’s pangasius export market because the COVID-19 pandemic had caused suspended production and economic damage.

They said that they would increase their participation in trade promotion programs and exploit new markets such as China and Mexico in addition to maintaining key export markets such as the US and Asia.

The Vinh Hoan JSC (VHC)’s first-quarter revenue was reported at 1.63 trillion VND, down by 9 percent year-on-year. The high cost of goods sold caused gross profit to halve to only 215 billion VND.

The company’s after-tax profit decreased by 51 percent to touch 152 billion VND.

At the end of March, VHC's total assets stood at 6.44 trillion VND, down nearly 200 billion VND from the beginning of the year.

Short-term receivables were recorded at nearly 1.3 billion VND, down 14 percent compared to the beginning of the year. VHC's inventories and liabilities decreased by 5 percent and 19 percent, respectively, to nearly 1.34 trillion VND and 1.4 trillion VND.

VHC attributed the sharp decline in business results to the sharp decline of pangasius prices and the impacts of the COVID-19 pandemic.

VHC forecast two scenarios for its 2020 business results. In the negative scenario, VHC expects to collect 6.45 trillion VND in revenue and 800 billion VND in post-tax profit, down by 18 percent and 68 percent year-on-year.

In a more positive scenario, the company targets a fall of nearly 10 percent in post-tax profit compared to the previous year. This is the first time VHC has planned a fall in profit since its listing.

The Hung Vuong JSC (HVG) suffered a loss of nearly 254 billion VND in Q1.

HVG's sales of goods and services decreased by 46 percent compared to the same period in 2019, to over 729 billion VND.

HVG said that since October last year, purchasing power in most export markets had dropped sharply.

Mekong Fisheries JSC (AAM) also witnessed profit falling by 79 percent to reach only 666 million VND in the first quarter.

AAM attributed the decline to the sharp decrease in export sales.

Pangasius was a strategic product of the fishery industry, but was facing increasingly strict economic and technical barriers, the company said.

In 2020, AAM leaders have set a target of 220 billion VND in revenue, equal to 2019, and pre-tax profit of 6 billion VND, down 25 percent.

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(Source: VNA)