Ha Bac Nitrogenous Fertiliser report third annual consecutive loss

February 08, 2018 | 16:28

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Ha Bac Nitrogenous Fertiliser & Chemicals JSC (Hanichemco) reported a loss of VND612 billion ($26.98 million), marking a consecutive loss for the third year.

ha bac nitrogenous fertiliser report third annual consecutive loss

Increasing expenses and plunging price conspired in Ha Bac Nitrogenous Fertiliser's continuous misfortune

Hanichemco has published its financial report in the fourth quarter of 2017. Accordingly, it acquired VND730 billion ($32.2 million) in revenue, up 20 per cent against the same period in 2016. The company’s revenue for the whole year was VND2.33 trillion ($101.39 million).

According to the leaders of Hanichemco, increasing material costs boosted input expenditure, while the selling price saw a plunge, resulting in losses.

This is the third consecutive year Hanichemco reports a loss. Notably, in 2015 alone, the company suffered losses of VND700 billion ($31.3 million), while the figure in 2016 was VND1.05 trillion ($46.2 million).

The company started making losses after expanding its production facility, upgrading its capacity to 500,000 from the initial 180,000 tonnes per year, in June 2015.

Due to the bleak financial results, it was ignored by investors when it listed on the UpCoM trading platform in late July 2017.

Notably, on July 26, Hanichemco (ticker DHB) made 272.2 million shares, representing a registered capital of VND2.71 trillion ($119.2 million), officially available for trading at the initial reference unit price of VND6,800. At present, the share is valued at VND4,800.

A subsidiary of state-run Vietnam National Chemical Group (Vinachem), Hanichemco specialises in manufacturing urea nitrogenous fertiliser, which makes up 80 per cent of its revenue.

However, in recent years, the domestic demand for urea fertiliser fell far short of supply, leading to extreme imbalance. Besides, the domestic fertiliser manufacturing sector also needs to compete with imported products, especially cheaper Chinese ones.

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