Thuong Dinh Shoes reported a profit after tax of 117 million VND in 2022, "reviving" after 5 consecutive years of reporting losses since 2017.
According to the recently released audited financial report, in 2022, Thuong Dinh Shoe Joint Stock Company (GTD) achieved net revenue of 109 billion VND, unchanged compared to the same period in 2021.
However, thanks to other indicators mostly recording significant improvements, Thuong Dinh Shoes unexpectedly reported a profit after tax of 117 million VND, "reviving" after 5 consecutive years of reporting losses since 2017.
Previously, in 2017, 2019, 2020, each year Thuong Dinh Shoes lost more than 13 billion.
However, Thuong Dinh Shoes's liabilities increased to 72 billion, up 11% over the previous year, mostly short-term debt.
As of December 31, 2022, total current liabilities exceeded current assets. This shows an imbalance in the company's ability to pay short-term debts, thereby affecting the future continuity of Thuong Dinh Shoes.
Thuong Dinh Shoes' charter capital is currently 93 billion VND. Of which, Hanoi People's Committee holds 68.67% of the capital, Thai Binh Investment and Trade Joint Stock Company owns 10% and the rest is held by other shareholders.
"Fulcrum" is the land fund in Nguyen Trai, Ha Nam, Thanh Hoa
Established in 1957, Thuong Dinh Shoes was formerly the X30 factory of the Quartermaster Department - General Department of Logistics, specializing in the production of hard hats and rubber sandals for the military. In 1993, the name Thuong Dinh Shoes was officially applied and became a brand close to the lives of Vietnamese people.
In 2015, Thuong Dinh Shoes decided to IPO on the HNX floor and transformed into a joint stock company in 2016.
After more than 60 years, Thuong Dinh Shoes now has export markets to EU countries, Australia and some Asian countries. However, in the past 5 years, a wave of branded goods such as Adidas, Puma, Nike,... has landed in Vietnam, sparking fierce competition between foreign and domestic shoe brands, causing Thuong Dinh Shoes to be almost completely overshadowed.
In the market, while other long-standing brands like Biti's also have to "change the look" of their products, spend hundreds of billions of dong to implement brand identity strategies, and change their images to suit trends, Thuong Dinh Shoes' products almost do not have many changes in design.
Thuong Dinh Shoes' image in the eyes of consumers is still cheap sports shoes priced at around 100,000 VND and labeled as "work safety shoes". This weakness has caused the once-famous shoe brand to lose steam in the race for market share.
However, earlier this year, Thuong Dinh Shoes made a comeback after being mistaken for the shoe model promoted by rapper HIEUTHUHAI on his personal page. In fact, the shoe with the same design as Thuong Dinh worn by HIEUTHUHAI is Asia Sports, this confusion caused Thuong Dinh Shoes' products to sell out on many websites.
In fact, the recent modest return to profit is still not enough to erase the accumulated loss of 49 billion VND of this company. Thuong Dinh Shoes' only support at present is probably thanks to the company's land fund, located in crowded locations of Hanoi such as the 36,105 m2 land at 277 Nguyen Trai, Hanoi. Currently, the company is in the process of renewing the land lease contract.
The land of Thuong Dinh Shoes is located near the intersection of Nguyen Trai Street and Ring Road 3.
Or the 17,587m2 land plot in Dong Van Industrial Park, Ha Nam, the 18,403m2 land plot in Dong Van Industrial Park, Duy Minh Commune, Ha Nam, lease term until 2054... The leased lands in the central street of Ton Duc Thang, Dong Da District, Hanoi and Ha Dinh, Thanh Xuan.
In 2020, the company said that production and business at 277 Nguyen Trai, Hanoi were ineffective and had no advantages. Average costs increased due to fixed costs such as depreciation, land rent, etc. remaining almost unchanged while output decreased, leading to a loss in production and business results that year.
In 2022, the real estate tax and land rent that the company has to pay is more than 9 billion VND.
According to Decision No. 908 issued by the Prime Minister on June 29, 2020, the Hanoi People's Committee will have to divest state capital in 28 enterprises by the end of 2020. Accordingly, the Hanoi People's Committee is required to divest all 68.67% of capital at Thuong Dinh Shoe Joint Stock Company before December 31, 2020, but up to now, the divestment has not been completed.
Market Pulse
Comment (0)