Financial woes hit tra fish industry

The consolidated financial report of Vinh Hoan JSC shows that net revenue of the company in the fourth quarter in 2012 reached VND1.11 trillion, a strong growth over the year-ago period.

However, Vinh Hoan only obtained VND41.51 billion in after-tax profit, slumping 61pct year-on-year, according to the report. It posted about VND4.21 trillion of accumulated net revenue in all of 2012 while its after-tax profit stayed at more than VND208 billion, slipping by up to 47pct against 2011.

Similarly, Viet An JSC reports over VND456 billion of net sales and VND16.46 billion of after-tax profit during last year’s quarter four, shrinking 17pct and 48pct year-on-year respectively. The enterprise attributed the negative business result to the tough conditions faced by the seafood industry along with higher financial expenses and related fees.

Viet An had accumulated around VND1.87 trillion of net sales for the whole year 2012 which is equivalent to the preceding year’s amount but the firm had seen its after-tax profit drop by 8pct to approximately VND47 billion last year.

Hung Vuong JSC also faced the same problems, with its after-tax profit going down 77pct year-on-year to VND24.4 billion in the fourth quarter in the same year. The company in 2012 enjoyed net revenue which equals to the 2011 figure but its after-tax profit was only VND324.7 billion, down 33pct compared to 2011.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), the country’s tra fish export generated $1.74 billion in 2012, down 3.4pct versus 2011 and lower than the $1.8 billion target. The association ascribed the situation to tough access to loans for production and export of member companies, slackened demand, volatile supply of input materials and decreased export price.

VASEP forecasts the local tra fish industry will continue to face the same challenges this year, with certain tra fish farms expected to be scaled down at small farming households. The association also believes that there will be many enterprises suffering severe capital shortfalls in 2013.