Rubber company profits can be distinguished this year

Phuoc Hoa Rubber Joint Stock Company (PHR) has just announced its business plan for 2022 with an expected revenue of more than 2,250 billion VND and profit after tax of 744 billion VND from the parent company. Target revenue increased by almost 16% compared to last year, while profit is expected to increase by almost 56%.

Also with high expectations this year, Southern Rubber Joint Stock Company (Casumina – CSM) is determined to continue to reduce production costs so that profits will return to their previous level of around 136 billion dong. If the plan is completed, Casumina’s profit this year will increase by triple digits, eliminating the average of only tens of billions of dong that has survived from 2017 to the present.

At the same time, many businesses in the same industry have prepared careful business plans. The Joint Rubber Company Dak Lak (DRI) expects revenue to slightly increase to around 600 billion dong. However, the profit before tax target has fallen by around 9.5% compared to last year’s performance.

Similarly, Thong Nhat Rubber Joint Stock Company (TNC) also raised its revenue target to 75%, but after-tax profit fell 19% compared to 2021. Tay Ninh Rubber also set a pre-tax profit target of more than 75 billion VND, down more than 33 % compared to 2020.

A recent Thanh Cong Securities (TCSC) report also forecasts that the after-tax profit of the Dong Phu Joint Stock Company (DPR) will fall by nearly 20%, although revenue will still grow.

In general, rubber is predicted to remain a profitable business this year. The Association of Natural Rubber Producing Countries (ANRPC) believes that the prospect of the rubber industry in 2022 will be very bright, selling prices will remain high. Global rubber production this year will increase 5.6% compared to last year.

Statistics from the General Department of Customs show that in the first two months of this year, rubber exports only increased slightly in volume, but increased by 7.4% compared to the same period last year.

According to the Vietnam Rubber Association, the scarcity of rubber raw materials will cause latex prices to continue to increase or remain at high levels. This helps Vietnam to benefit both in terms of output and value.

However, the company’s profit plan is divided mainly due to the influence of financial income from subsidiaries or other activities such as liquidation of rubber trees, land compensation… Last year, Many businesses also recorded profit fluctuations due to the above items.

In which, Dak Lak Rubber had difficulty with financial income from its overseas subsidiary – Daklaoruco. Currently, the outstanding DRI loan is no less than Lao Kip (LAK), once the exchange rate fluctuates, it will greatly affect business results, especially the world currency market which is predicted to be unpredictable. Last year, the kip fell to a 15-year low against the USD, significantly increasing Dak Lak Rubber’s finance costs.

Especially for the fourth quarter of 2021, this business experienced a loss due to a foreign exchange difference of more than 40 billion dong. In addition, DRI also lost more than 11 billion dong from the liquidation of its rubber plantations at that time, reducing its profit by more than half compared to the same period last year.

Also affected by its overseas subsidiaries, Tay Ninh Rubber Joint Stock Company (TRC) this year anticipated the scenario that Siem Reap – Rubber Development Company (Cambodia) would suffer an after-tax loss of nearly 62 billion dong. Currently the company is just entering its 3rd year of exploitation.

It’s not difficult because its subsidiary, Dong Phu Rubber may be at a loss for land compensation this year. With a cautious view, TCSC believes that the 317 billion land compensation amount of the expanded North Dong Phu Industrial Estate will not be recognized immediately, but will have to wait until 2023. As a result, this business will lose profits. This year.

In addition, the liquidation of timber often makes a relatively large contribution to Dong Phu Rubber’s profits when the business is liquidating an average of about 500 hectares of rubber per year. Especially in the fourth quarter of 2021, the DPR’s profits suddenly increased when there was a profit of more than 200 billion dong from the liquidation of rubber trees. However, since the company did not plant new crops in the period 1995-2002, the liquidation rate is expected to slow down.

Siddhartha

at Blogtuan.info – Source: vnexpress.net – Read the original article here