Many businesses 'swim against the tide' to win big

Real estate and construction giants make huge profits

The most difficult thing during the past year, which has lasted until now, is real estate. According to data from the General Statistics Office, in 2023, about 1,300 real estate enterprises (EOEs) dissolved, an increase of nearly 8% compared to the previous year. On average, about 107 companies left the market each month, the rest had to cut staff by 50 - 75%. However, there were still many big names in the industry that had a spectacular "comeback", reporting large profits in the last days of the year.

Many manufacturing and business enterprises in difficult industries during the year had a spectacular comeback in the final period of the year.

First of all, we must mention the "big brother" Vinhomes. The financial report shows that in 2023, Vinhomes achieved VND 103,334 billion in net revenue, an increase of 66% compared to 2022. In which, the total consolidated net revenue converted including revenue from Vinhomes's activities, business cooperation contracts and real estate transfers recorded in financial revenue reached VND 121,400 billion, an increase of 49% compared to the previous year.

Most of this figure is thanks to the company completing the handover of 9,800 low-rise real estate units at the Vinhomes Ocean Park 2 and 3 projects. As a result, the company's consolidated profit after tax in 2023 exceeded the year's plan, reaching VND33,300 billion, up 14% over the previous year. It is expected that in 2024, this company will open the largest Vincom Mega Mall Grand Park shopping center in the South next April and continue with two Grade A office tower projects at Vinhomes Grand Park and the gateway to Vinhomes Ocean Park 2 and 3. Along with the electric vehicle manufacturing and trading segment, the revenue of the parent company - Vingroup Corporation - in 2023 reached VND161,634 billion, up 59% over the previous year. This is also a record revenue for this company.

Similarly, thanks to financial revenue doubling over the same period, the profit in the fourth quarter of 2023 of Nova Real Estate Investment Group Corporation (Novaland) skyrocketed 12 times over the same period last year, with VND 805 billion in net profit. In 2023, financial revenue became a bright spot for Novaland when it recorded VND 5,741 billion, up 15%, thanks to nearly VND 415 billion in profits from trading securities. In addition, profits from investment cooperation also increased by 39%... helping the company not only complete its goals but also exceed the business plan target of last year by more than 220%.

Also in a bright color, in 2023, Nam Long Group's profit from joint ventures and associates reached more than 418 billion VND, a sharp increase of nearly 17 times compared to the previous year. As a result, the company's after-tax profit reached nearly 484 billion VND, down 13% compared to 2022. However, this is considered a relatively low decrease compared to the general level when the real estate market "froze" for a long time last year. Thanks to that, by the end of 2023, Nam Long Group's total assets reached 28,600 billion VND, up 6% compared to the beginning of last year.

In a recent analysis report, SSI Securities Company estimated that in 2024, Nam Long could record revenue of VND6,860 billion, up 133% over the same period, and profit after tax of parent company shareholders of VND1,030 billion, up 136%. The reason comes from changing to a lower-priced housing segment, affordable for most people in need, helping this company turn the tide during the crisis. Although the group's business results last year did not meet expectations, they show that the new direction will help the company recover well this year.

2023 is also a year of peak difficulty for the construction industry. Therefore, the business results of Hoa Binh Construction Group in the fourth quarter of 2023 with revenue of VND 2,190 billion, gross profit of VND 53 billion, while in the same period it lost more than VND 462 billion. Notably, the reported profit after tax of Hoa Binh's parent company shareholders reached nearly VND 103 billion, while in the same period it lost more than VND 1,200 billion. The results of Hoa Binh, the leading bird in this industry, make the overall picture less gloomy.

Production, consumption and services also accelerated.

Like real estate, the Vietnamese aviation industry has experienced a year of 2023 with many challenges. Despite having to increase prices "to the max", the pressure of costs and the international passenger source has not recovered as expected, causing most airlines to struggle to bear losses. However, the recently released 2023 business results report of Vietjet Air recorded extremely impressive results with revenue of 53,600 billion VND, an increase of 62% compared to 2022. Profit after tax reached 697 billion VND, becoming the only Vietnamese airline to make a profit since the Covid-19 pandemic until now.

In the fourth quarter of 2023 alone, Vietjet's revenue increased by 89%, bringing in VND 14,900 billion, helping the airline "pocket" VND 70 billion in after-tax profit. Ancillary and cargo revenue in the fourth quarter also recorded strong growth of 46% compared to 2022, contributing 40% of total air transport revenue. Vietjet's spectacular comeback is the result of its pioneering efforts to open many new routes to serve tourism.

The first flights connecting Vietnam to major cities in India or to Australia recorded high occupancy rates, reaching an average seat utilization rate of 87%. This shows that the tourism picture has many bright spots. Thanks to that, one of the leading tourism companies, Vietravel, also had a happy year-end season with net revenue of VND1,368 billion, up 21% over the same period last year. After deducting the cost of goods sold, the company's gross profit was VND156 billion, more than 5 times higher than the same period last year.

For manufacturing and consumer businesses, the past year has been an extremely difficult period as purchasing power hit rock bottom. Even at the time approaching Lunar New Year, the market has yet to make a breakthrough. However, that has not prevented many businesses from pocketing profits of thousands of billions of dong.

For example, the "steel king" Hoa Phat's last quarter of the year saw its net profit increase by 249% year-on-year and 48% quarter-on-quarter - reaching VND2,969 billion. As a result, the group's total revenue recorded VND34,925 billion, up 33% over the same period in 2022. This is the quarter that recorded the best business results of the whole year 2023 for Hoa Phat.

According to the company's financial report, the main product line of steel has not recovered as in the previous period, but the strong growth of the agricultural sector and household goods has contributed to adding many bright colors to the business picture at the end of the year. In particular, the sales output of Hoa Phat Poultry for the first time exceeded 300 million clean eggs, exceeding the annual plan by 10% and increasing by more than 17% compared to 2022.

This result helped Hoa Phat reach the target of 300 million eggs 2 years ahead of schedule. At the same time, it motivated the company to officially supply the market with a line of pink-shelled chicken eggs called "Hoa Phat Smile" from the beginning of 2024. Similarly, the demand of consumers to buy household appliances at the end of the year also prompted Hoa Phat Household Appliances to continuously launch a series of new product lines in the last 3 months of 2023. Many kitchen appliances such as range hoods, slow juicers, rice cookers, pressure cookers, electric kettles, etc. were launched for the first time and received great attention from consumers.

If the consumer segment is a major growth driver for the "steel king", then certainly, leading retailers cannot miss the opportunity to accelerate the peak season at the end of the year. Despite the weakening of consumption, The CrownX - Masan Group's integrated retail consumer platform, recorded a revenue growth of 2.6% over the same period last year, bringing in revenue of VND 57,684 billion in 2023 for Masan.

Masan's representative commented that the market has been volatile in recent times, and the global economic outlook is not very bright, which could affect Vietnam's recovery path. However, businesses with consumer-focused businesses that generate solid cash flows like Masan have many advantages in accessing domestic and international capital markets with very favorable conditions. This unit also forecasts that the consumer market in Vietnam will grow slightly in the first half of 2024 and recover rapidly in the remaining half of the year.

This is the basis for Masan to confidently set a consolidated net revenue target of VND84,000 - 90,000 billion in 2024, increasing by 7 - 15% over the same period; core after-tax profit before allocation to minority shareholders is in the range of VND2,290 - 4,020 billion, a strong growth compared to VND1,950 billion in 2023.

Not only relying on the purchasing power of the domestic market, many businesses have quickly adapted and promoted their export advantages to reach the finish line in the fourth quarter. A typical example is Vinamilk. The increase in export orders in the last quarter of 2023 has helped the revenue of the "giant" in the dairy industry grow impressively. Vinamilk's financial report for the fourth quarter of 2023 recorded total consolidated revenue and profit after tax of VND 15,630 billion and VND 2,351 billion, respectively, up 3.6% and 25.8% over the same period. Notably, foreign markets had an impressive growth rate of 11.7% over the same period, contributing VND 2,534 billion in revenue. Of which, net export revenue reached VND 1,298 billion in the fourth quarter of 2023, a strong breakthrough with a growth rate of 19.3% over the same period.

Promote business support policies

According to economic experts, the revenue and profit of some large enterprises have changed in a positive direction due to both subjective and objective reasons. These are efforts to optimize costs, drastically cut costs, even cut personnel to streamline the apparatus, and reduce pressure on salary costs. The qualitative change that can be seen in many enterprises is that the amount of debt payable has decreased, profits have been pushed up thanks to drastic restructuring policies; products have changed in the direction of prices approaching the needs and budgets of consumers. For example, many real estate enterprises have shifted to developing the mid-range housing segment, and the consumer goods industry has launched products suitable for people's budgets in the context of falling incomes.

Dr. Nguyen Quoc Viet - Deputy Director of the Institute for Economic and Policy Research - commented that 2023 passed in difficulties and many disadvantages, making it impossible for the economy to break through as expected. Looking at the level of Tet shopping this year, it can be seen that people's consumer psychology is still quite cautious. Along with the macro indicators, the business results of some large enterprises, leading the production and business sector, show positive changes, although still quite modest. However, that is a remarkable great effort of enterprises and there are even "heavenly time, favorable location" factors that need to be promoted.

For example, consumer goods manufacturer Masan has its own market segment, in particular, their niche market is quite good so they still have a stable revenue stream. Or Vinhomes has many products that sold quite well last year, this year if there are no new products, many product lines of the company may stagnate, but positive results will help the company create momentum to continue...

Dr. Nguyen Quoc Viet emphasized that the challenges are still very large, especially from external unfavorable factors and internal limitations and shortcomings that have lasted for many years. Therefore, monetary policy management needs to be more proactive, flexible, and timely; encourage credit institutions to reduce costs, simplify lending procedures, and continue to reduce lending interest rates to support businesses. In particular, focus on removing difficulties for production and business, promote cutting and simplifying administrative procedures and business regulations in conjunction with strongly promoting digital transformation. To support businesses to recover well, it is necessary to focus on reviewing, cutting and simplifying administrative procedures and business regulations to facilitate and reduce costs for people and businesses.

Along with the macro indicators, the business results of some large enterprises, leading the manufacturing and business sector, show positive changes, although still quite modest. However, this is a remarkable effort of the enterprises and there are even "heavenly time, favorable location" factors that need to be promoted.

Dr. NGUYEN QUOC VIET , Deputy Director of the Institute for Economic and Policy Research

In the fourth quarter of 2023, total profit of listed enterprises increased sharply by nearly 50%

The latest update from FiinTrade shows that as of the morning of January 31, 995 listed companies representing 95.6% of capitalization on the three stock exchanges have announced their financial statements for the fourth quarter of 2023, with total after-tax profit growing strongly by 49.4% over the same period and 15.9% over the previous third quarter. Of which, the extraordinary growth was recorded in the non-financial sector, up 35.1% over the same period last year and up 31.1% over the previous quarter, while the after-tax profit of the financial sector increased by 20.2% year-on-year and 9.8% quarter-on-quarter, respectively. The recovery in profits in the steel group (HPG, HSG) and irregular income of Ha Bac Fertilizer (DHB) contributed significantly to this high growth. Specifically, the steel group's after-tax profit in the fourth quarter of 2023 increased by 212.1% over the same period last year and was positive by 56% over the previous quarter.

Over 90% of tourism businesses expect strong revenue growth

The survey results of tourism and hotel enterprises recently announced by Vietnam Report recorded that 66.7% of enterprises participating in the survey said that the tourism industry's prospects in 2024 will be more positive. Of which, 92.9% expect the revenue target to increase the most in 2024; 85.7% of enterprises expect growth in profits and number of visitors. This confidence is built on the foundation of the new visa policy that took effect from August 15, 2023, which has received enthusiastic support from many organizations and enterprises. In the last 4 months of 2023, the number of international visitors reached over 1 million, far exceeding the original plan. By 2024, this policy will continue to be considered by 92.9% of enterprises participating in Vietnam Report's survey as the main "lever" to help Vietnam's tourism continue to grow.

The Department of Business Registration Management (Ministry of Planning and Investment) forecasts that the total number of newly registered enterprises in 2024 will increase by 2% compared to 2023, reaching about 162,500 enterprises. Regarding the number of enterprises returning to operation, based on the situation in 2023 decreasing by 2.4% compared to the same period in 2022, the Department of Business Registration Management adjusts the estimated implementation in 2024 from 74,000 enterprises to about 68,000 enterprises, an increase of 16% compared to the same period in 2023. The number of enterprises withdrawing from the market in 2024 is expected to still increase compared to the same period in 2023, however, this increase is expected to cool down significantly compared to the period of prolonged impact of the Covid-19 pandemic. This number is forecast to increase by only about 3.5% compared to the same period in 2023, equivalent to more than 178,000 enterprises withdrawing from the market (of which, about 10% is the number of enterprises carrying out dissolution procedures, actually ceasing operations and leaving the market).

Source link: https://thanhnien.vn/nhieu-doanh-nghiep-loi-nguoc-dong-thang-lon-185240131222333241.htm