Seafood exports set a record, how profitable is the business?

Seafood businesses also set a record profit target after a long period of gloom due to the impact of the COVID-19 epidemic.

Exports hit a record

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), seafood exports in March were estimated at 900 million USD, bringing the accumulated accumulation in the first quarter of 2022, seafood exports reaching 2.52 billion USD, an increase over 45% over the same period last year.

Contributing to this strong growth is mainly due to the strong recovery of pangasius when in the first 3 months of the year, the export of this item was estimated at 646 million USD (up 88% over the same period last year). Pangasius is regaining its position in the structure of export aquatic products when accounting for 27% of the export value of the whole industry.

For shrimp products, in the first quarter of this year it reached over $900 million (37% higher than last year), accounting for 37% of Vietnam’s seafood export proportion.

Notably, according to VASEP, the demand for seafood products in the US, EU, Japan, Korea, China, UK… is very large. A series of restaurants, supermarkets… in markets are reopening, helping Vietnamese businesses fill up with orders until the end of the year.

Mr. Truong Dinh Hoe, General Secretary of VASEP, said that Vietnam’s seafood export forecast in April will still maintain a growth rate of 25%, reaching 934 million USD. In which, shrimp and pangasius continued to be bright spots. Prices of these two commodities are forecasted to continue to increase and remain at a high level in the first half of 2022 due to a shortage of raw materials, especially when trade agreements such as EVFTA (Vietnam – European Union), UKVFTA (Vietnam – European Union) The Vietnam – UK Free Trade Agreement) started to take effect.

Huge profit business

Thanks to the positive growth in the first quarter of the year, businesses in the industry also set a record profit target after a long dismal period due to the COVID-19 epidemic.

Statistics show that, in the first quarter of 2022, 10 seafood enterprises had an average growth rate of 57.4%.

Typically, Vinh Hoan Seafood Joint Stock Company (stock code VHC) announced its first quarter business results with revenue of VND 3,276 billion, up 83% over the same period; profit after tax reached 553 billion dong, 4 times higher than the profit of 131.5 billion dong in the same period last year.

According to VHC, the above result is mainly due to the strong growth of the products the Company is trading, including pangasius with an increase of 93%, by-products with an increase of 46%, health products by 87% and other products with an increase of 87%. up 685%. Shrimp crackers increased by 46%, rice by 15% and added value of products by 19%. Revenue grew well in all regions such as in the US market up 161%, Europe up 27%, China up 71% and Vietnam up 100% over the same period last year.

The Multinational Investment and Development Joint Stock Company (stock code IDI) is estimated at more than 1,000 billion dong in revenue and nearly 200 billion dong in after-tax profit in the first quarter of the year. This is a record quarterly profit in the Company’s history.

According to Mr. Le Thanh Thuan, Chairman of the Board of Directors of IDI, the company has stored up to 1,400 billion VND of raw materials, priced at 17,000 – 18,000 VND/kg thanks to 3 cold storages during the Southern provinces’ implementation of relaxation. Due to social distancing, now fish prices are high and supply is scarce, creating great opportunities for IDI.

Cuu Long An Giang Seafood Import-Export Joint Stock Company (code ACL) recorded a revenue of 325.4 billion dong in the first quarter, a slight decrease compared to the same period last year, but profit after tax reached 62.6 billion dong, a double increase. nearly 6 times in the same period last year. ACL expects net revenue to reach VND 1,450 billion (+20% y/y) and pre-tax profit of VND 200 billion, 4 times higher than last year. By the end of the first quarter, the Company has completed nearly 22% of the revenue plan and achieved nearly 36% of the profit target assigned for the whole year.

With such a favorable start, many seafood exporters are quite optimistic when setting production and business plans in 2022 to increase sharply compared to 2021.

For example, Vinh Hoan sets a target of 13,000 billion VND in revenue for the year, and 1,600 billion VND in profit after tax, up 44% and 36% respectively over the same period last year. This is also the highest plan since listing (2007) up to now. Meanwhile, IDI expects this year to bring in 8,300 billion dong in revenue, up 45% compared to 2021 and 900 billion dong in profit after tax, 6.6 times higher than the previous year’s performance.