Mobile World (MWG) 9-month profit decreased by 97.8%, additional debt of 6,300 billion

After 9 months, Mobile World (MWG) has only completed 1.8% of its 2023 target.

According to Q3 business results, Mobile World (MWG) recorded net revenue of VND30,287.7 billion, down 5.4% year-on-year. High cost of goods sold caused gross profit to decrease by 37.2% to VND4,642.9 billion. Gross profit margin also decreased from 23.1% to 15.3%.

Financial revenue increased to VND618.1 billion, equivalent to an increase of 77.5%. Financial expenses, on the other hand, increased by VND10.3 billion, to VND444.9 billion. Total selling expenses and business management expenses were reduced by 18.4%, to VND4,620.3 billion.

Mobile World MWG decreased by 978 billion VND in the first 9 months of the year, adding 6,300 billion VND to its value. — Mobile World (MWG) profit in the first 9 months of the year decreased by 97.8%, borrowing more than 6,300 billion VND (Photo TL)

After deducting all expenses and income tax, Mobile World's after-tax profit was VND38.8 billion, down 95.7% year-on-year. It can be seen that if it weren't for the sudden increase in financial revenue, MWG would almost certainly have suffered a loss in Q3 from its core business activities.

Accumulated revenue in the first 9 months of the year reached VND86,858.3 billion, down 15.5% over the same period. Profit after tax reached VND77.5 billion, down 97.8% over the first 9 months of the year.

Notably, in the first 9 months of the year, many Mobile World chains reported losses, including: Bach Hoa Xanh chain lost 904.9 billion VND, the total accumulated loss to date has reached 8,299.9 billion VND; An Khang Pharmaceutical JSC also lost 234.4 billion VND, the accumulated loss to date is 553 billion VND; Tran Anh Digital World JSC lost 46.9 billion VND; MWG in Cambodia also lost 96.8 billion VND, the accumulated loss is 701.5 billion VND.

Comparing business results with the target set at the beginning of the year, revenue of 135,000 billion VND, profit after tax of 4,200 billion VND, currently MWG has only completed 64% of the revenue plan and 1.8% of the annual profit plan.

Short-term debt increased by 6,338.5 billion VND in just the first 9 months of the year

At the end of the third quarter of 2023, Mobile World's total assets reached VND58,644.8 billion, an increase of about 5% compared to the beginning of the year. Of which, cash and cash equivalents decreased by more than half, to VND2,351.9 billion. The company currently has short-term deposits at banks of up to VND20,901.9 billion.

Inventory during the period decreased from VND25,969.1 billion to VND22,853.5 billion, equivalent to a decrease of 11% compared to the beginning of the year. Provision for inventory depreciation is currently accounting for VND226.8 billion. Notably, MWG's fixed asset index decreased sharply by 24.2%, down to only VND7,370.8 billion.

In the company's capital structure, liabilities still account for a large proportion of 60.3%, equivalent to VND 35,374.6 billion. Most of which is short-term debt with VND 29,475.3 billion.

In the first 9 months of the year, MWG tended to increase short-term borrowing. The short-term borrowing index increased from VND 10,688.1 billion to VND 17,026.6 billion, an increase of 59.3%. Thus, in just 9 months, MWG increased short-term borrowing by VND 6,338.5 billion. The company's long-term borrowing did not fluctuate much, accounting for VND 5,899.4 billion.

Owner's equity at the end of the third quarter accounted for VND23,270.2 billion with a relatively large amount of accumulated undistributed profit after tax. Undistributed profit after tax accounts for VND8,070.1 billion.

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