Hanoimilk shareholders do it tough

July 02, 2012 | 16:23

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Hanoimilk shareholders will not get a 2011 dividend in their back pockets after a difficult business year.

At its 2012 annual general meeting, its shareholders agreed not to receive a 2011 dividend, the fourth straight year without a dividend. By December 31, 2010, Hanoimilk posted an accumulated loss of VND61.92 billion ($2.97 million), which was not cushioned by an after-tax profit of VND1.58 billion ($75,961) in 2011.

In 2012, the company targets revenue of VND335.5 billion ($16.1 million), down 12 per cent against 2011’s actualised figure. However, in 2012’s first quarter, it posted a loss of nearly VND1 billion ($48,076) and currently holds just a 4 per cent market share.

The biggest player is now Vinamilk with a nearly 40 per cent market share followed by Dutch Lady with nearly 25 per cent, Moc Chau Milk Company with nearly 10 per cent and International Dairy at 5 per cent.

Hanoimilk's chairman Ha Quang Tuan said the company still faced many difficulties after a crisis in consumer confidence in 2008, after melamine was reportedly found in some of its products.

In October 2008 in Vietnam, industrial chemical melamine was found in around 380 tonnes of milk powder materials imported from China by a number of local companies including Hanoimilk and Ancomilk.

"The opportunity for Hanoimilk to improve its market position is increasingly more difficult. And if the company cannot break through to hold a 5 per cent market share, it will be hard to compete," said Tuan.

However, he added that Hanoimilk could be in the top three of Vietnam’s dairy market.