Thanh Cong Textile Garment – Investment – Trading JSC (HSX: TCM), one of the leading enterprises of Vietnam's textile and garment industry, reported its first after-tax loss of $282,425 of the year in August due to the COVID-19 pandemic.
|Thanh Cong Textile Garment – Investment – Trading JSC |
According to Thanh Cong Textile's financial report in August, the company recorded net sales reached more than $10.5 million, with the garment segment accounting for 74 per cent. The company reported an after-tax loss of $282,425 in August in contrast to the $1 million after-tax profit in the same period in 2020.
This was the first month in 2021 that the company reported losses due to the pandemic as labour productivity fell short of the plan while operating costs under the authorised operational model were high, leading to low gross profit margin in the period which eliminated profit.
Accumulating over the first eight months, Thanh Cong Textile recorded $106 million of revenue and $5.5 million of after-tax profit, respectively up 4 per cent and down 24 per cent over the same period in 2020.
This year, the company targets reaching revenue of VND4.2 trillion ($182.6 million) and an after-tax profit of VND290 billion ($12.6 million). With this result, the company completed 59 per cent of the revenue target and 44.4 per cent of the profit target.
Thanh Cong Textile revealed that it has received orders until the first quarter of 2022, however, with the current low capacity, it would not finish orders on time. The company has accelerated the construction of the Thanh Cong Vinh Long 2 garment factory to prepare for production in 2022.
The company said that textile and garment enterprises are currently receiving many orders from US and EU customers but the shortage of human resources will be a big challenge for the industry from the third quarter onwards.
Amongst the export markets of Thanh Cong Textile, the US market accounts for the highest proportion with about 32 per cent, followed by South Korea (28 per cent), and Japan and China (12 per cent each).