Market malaise stings PVFC

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PVFC’s after-tax profit in Q2 stood at VND124.52 billion ($6.07 million), a sharp fall from VND215.1 billion during last year’s corresponding period, according to the firm’s financial statement filed Ho Chi Minh Stock Exchange on August 23.

Nguyen Thien Bao, PVFC’s general director, attributed his firm’s weak performance to a gloomy securities market.

PVFC said its securities trading suffered losses of VND116.7 billion ($5.7 million) within 2010’s Q2. In 2010’s corresponding period, the firm also profited just VND970 million ($47,300).

Dipping income from its joint ventures and associates also helped dragging down PVFC’s results. The income reached just VND40.86 billion ($1.99 million), down nearly 67 per cent against last year.

The rising costs were also among main factor pushing down the consolidated results against the parent company’s single result.

PVFC posted a weak consolidated performance amidst investors’ concerns about big loans provided to Vinashin. By June 30, PVFC’s total outstanding loans to some of Vinashin’s units stood at VND1.13 trillion ($55.1 million), including VND1.06 trillion ($51.7 million) in overdue debts. But, PVFC did not consider Vinashin loans as bad debts.

Bao said the board of  directors was confident in the possibility in collecting the  Vinashin debt, as the State Bank had drawn measures for local credit institutions to deal with Vinashin loans. Within 2011’s first six months, PVFC had collected some VND232 billion ($11.3 million).

Bao added that his firm would strongly divest less-profitable investments and focus on low-risky ones. He indicated that PVF had liquidated VND6 trillion ($292.7 million) worth of investments so far.

As of June 30, the group had VND76.18 trillion ($3.7 billion) in total assets. Its equity stood at around VND7.15 trillion ($348.78 million), in which PetroVietnam held 78 per cent and Morgan Stanley 10 per cent.