Vi­na­sun to cut rev­enue fore­cast TAC in­creases div­i­dend by half to 24 per cent

Viet Nam News - - MARKETS -

HAØ NOIÄ — Taxi firm Viet­nam Sun Cor­po­ra­tion (Vi­na­sun) plans to cut its full-year rev­enue for the fourth time for 2018 due to ris­ing com­pe­ti­tion from for­eign ride­hail­ing firms.

The fig­ure for 2018 could be set at VNÑ2.16 tril­lion (US$96 mil­lion), down VNÑ1.07 tril­lion year-on-year, of which trans­porta­tion and mer­chan­dise in­come would ac­count for VNÑ2 tril­lion and the re­main­der would come from as­set sales.Vi­na­sun also fore­casts its post-tax profit for this year would be VNÑ95 bil­lion, half of the fig­ure in 2017. This is the low­est fig­ure for the firm in the past nine years.

The earn­ings fore­cast would be sub­mit­ted for ap­proval at the firm’s an­nual share­holder meet­ing, which is sched­uled for April 27. The com­pany has not yet pub­lished its full-year fi­nan­cial re­port for 2017. In 2018, the taxi com­pany will fo­cus on pre­serv­ing its mar­ket share and keep­ing its busi­ness op­er­at­ing prop­erly in the face of strong com­pe­ti­tion from ri­val ride­hail­ing ap­pli­ca­tions.

In or­der to do that, Vi­na­sun will buy at least 700 high-qual­ity ve­hi­cles, de­velop its non-cash pay­ment meth­ods and di­ver­sify its busi­ness co-oper­a­tion models.

In ad­di­tion, Vi­na­sun will pro­pose the trans­port min­istry cat­e­gorise busi­ness ac­tiv­i­ties of ride-hail­ing ap­pli­ca­tions to as­sure a fair mar­ket for do­mes­tic taxi firms. Vi­na­sun has re­ported slower growth rates in both net rev­enue and profit since the two ride-hail­ing ap­pli­ca­tions Uber and Grab en­tered Vieät Nam in mid-2014.

From 2010-15, Vi­na­sun’s net rev­enue in­creased from over VNÑ1.64 tril­lion to VNÑ4.25 tril­lion. The HCM City-based taxi com­pany also recorded that its post-tax profit grew from VNÑ179.4 bil­lion to VNÑ329.3 bil­lion. In 2016, how­ever, the com­pany’s net rev­enue grew at a slower pace to reach VNÑ4.5 tril­lion, while its post-tax profit fell to roughly VNÑ312 bil­lion.

In the first half of 2017, Vi­na­sun per­formed even worse as its net rev­enue dropped 16 per cent year on year to VNÑ1.9 tril­lion and its post­tax profit de­clined by a third to VNÑ100 bil­lion. The taxi firm is list­ing nearly 68 mil­lion shares on the HCM Stock Ex­change. Its shares have dropped grad­u­ally by nearly 60 per cent since Septem­ber 28, 2016 to close yes­ter­day at VNÑ13,400 (60 US cents) per share.

Ac­cord­ing to Vi­na­sun’s deputy gen­eral di­rec­tor Taï Long Hyû, the merger be­tween Uber and Grab in Vieät Nam could re­sult in a mo­nop­o­lis­tic taxi mar­ket and lo­cal taxi com­pa­nies could suf­fer from such a mar­ket con­di­tion. Af­ter Uber and Grab merged, the to­tal num­ber of ride-hail­ing app ve­hi­cles had in­creased to 78,000 across the coun­try and that num­ber was much big­ger than 20,000 tra­di­tional taxis in Vieät Nam, he said.

“The num­ber of high-tech taxis is ac­count­ing for 80 per cent of the over­all mar­ket, which could lead to a mar­ket mo­nop­oly for the for­eign firm. And it is the ques­tion on how the Gov­ern­ment would solve the prob­lem,” cafef.vn cited Hyû as say­ing.

Tra­di­tional taxi firms would have to adapt to new mar­ket con­di­tions, he said. Vi­na­sun has de­vel­oped an ap­pli­ca­tion to meet ris­ing de­mand from cus­tomers and keep up with mar­ket trends. In the near fu­ture, both taxi driv­ers and pas­sen­gers would know ex­actly how much a fixed trip would cost based on the ex­pected travel dis­tance in the ap­pli­ca­tion, just like other ride-hail­ing firms, in­stead of us­ing the me­ter to cal­cu­late the fares for pas­sen­gers, he said. — VNS HCM CITY — Cook­ing oil pro­ducer Töônø g An Veg­etable Oil Joint Stock Com­pany (TAC) an­nounced an in­crease in the div­i­dend for last year to 24 per cent from the ear­lier plan of 16 per cent at its an­nual share­hold­ers meet­ing yes­ter­day.

It came on the back of out­stand­ing busi­ness re­sults, with pre­tax prof­its grow­ing by over 98 per cent to VNÑ166 bil­lion (US$7.3 mil­lion).

Rev­enues only rose by 9 per cent to VNÑ4.3 tril­lion ($188 mil­lion).

The com­pany at­trib­uted the re­sults to the strong growth in the econ­omy and the cook­ing oil mar­ket. Nguyeãn Thò Haïnh, chair­woman of TAC, said: “The cook­ing oil in­dus­try is ex­pected to grow by 8.7 per cent in 2015-20. Con­sump­tion in Vieät Nam is still lower than in neigh­bour­ing coun­tries.”

TAC last year made changes to its prod­uct port­fo­lio with a fo­cus on healthy prod­ucts, she said.

Haïnh also hailed the merger with food pro­ducer KIDO Group.

“The merger with KIDO has helped us de­velop our lo­gis­tics and dis­tri­bu­tion sys­tems.”

She said the com­pany was now the sec­ond big­gest cook­ing oil pro­ducer.

The meet­ing also ap­proved a 24 per cent div­i­dend for this fis­cal year. In 2018, TAC tar­gets pre­tax prof­its of VNÑ250 bil­lion on rev­enues of VNÑ5.1 tril­lion ($223.6 mil­lion).

Haïnh told the meet­ing the tar­gets were chal­leng­ing but achiev­able since de­mand re­mained huge.

TAC plans to enter new seg­ments with a fo­cus on high-end prod­ucts to meet the re­lent­lessly grow­ing de­mand for healthy prod­ucts, she re­vealed.

“We will part­ner with do­mes­tic and for­eign in­vestors to enter the canned/pack­aged prod­ucts mar­ket in­clud­ing sugar, in­stant noo­dles, sauces and spices.”

The com­pany would con­tinue to ex­pand its dis­tri­bu­tion sys­tem, she said.

TAC, es­tab­lished in 1977, has a two plants each in Ngheä An Prov­ince’s Vinh City and Baø Ròa – Vuõng Taøu Prov­ince. — VNS

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