Rice companies reduce their sales targets.

DNHN - Many rice businesses have had to adjust their business plans to better suit the current context due to high-cost pressure and lower-than-expected output prices.

Trung An High-tech Agriculture Joint Stock Company has reduced its profit after tax forecast to VND 110 billion, nearly six times lower than the plan laid out at the start of the year. Previously, Trung An's target of 600 billion dongs in after-tax profit was considered a record-breaking achievement. 

According to Trung An's financial report for the first quarter of 2022, the company's net revenue increased by nearly 120 per cent to VND 958 billion; as a result, gross profit increased by 178 per cent to VND 84 billion. 

The majority of revenue comes from semi-finished products and goods, totalling VND 957 billion. Sales in Vietnam and exports both increased, bringing in VND 742 billion and VND 216 billion in revenue, up 107 per cent and 172 per cent, respectively, over the same period. 

However, with businesses continuing to face numerous challenges such as food protectionism, rising inflation, and high gasoline, fertilizer, and pesticide prices, Trung An must be cautious in its target. stated objective 

Similarly, An Giang Import-Export Joint Stock Company has adjusted its business plan for 2022, reducing revenue by half to around VND 3,940 billion and pre-tax profit by more than two-thirds to VND 25 billion, compared to the previous year. The previous annual general meeting of shareholders approved a figure of 70 billion dongs. 

In the first quarter, the company's revenue increased by 175 per cent to VND 1,020 billion, while profit after tax increased by 213 per cent to VND 12.5 billion. Thus, after only one quarter, the rice export company has met half of its newnet profit target. 

However, at the end of June, the company stated that the food industry is facing challenges such as rising input costs, while the profit margin of rice exporting to the European market is not high. Asia is low, and domestic competition is becoming increasingly fierce. 

As a result, "the adjustment of the business plan is to adapt to market fluctuations," according to Angimex's leader. 

Loc Troi Group Joint Stock Company has also announced a profit plan that will decrease by 4% compared to the previous year, with a profit target of only 400 billion dongs. This figure will remain constant throughout the year 2023. 

According to the first quarter financial report, the net revenue in the Loc Troi period reached more than 2,300 billion dongs, a slight decrease from the same period last year, and the profit after tax was 184 billion dongs, the same as the results achieved in the same period last year. 

Loc Troi's business plan will be adjusted this year, according to General Director Nguyen Duy Thuan, due to the impact of the COVID-19 epidemic and other unforeseeable factors. According to Securities Investment, Loc Troi's revenue is also affected by other factors such as global rice prices and rival competition. 

Mr Nguyen Ngoc Nam, Chairman of the Vietnam Food Association Nam, noted at the meeting to assess the situation of rice exports in the first six months of 2022 and forecast rice exports in the coming time that, while he still considered the market at the end of the year to be positive, rice exporters need to monitor market fluctuations in the Philippines, China, Indonesia, India, and other countries to have appropriate strategies and adjustments. 

Furthermore, in some other EU markets, although the amount of rice exported is currently small, there are very strict requirements for pesticide residues, which businesses must adhere to maintain the general reputation of Vietnamese rice in these countries.

Lâm Nghi