|Rice stocked at Tien Giang Food Company . — VNA/VNS Photo Vu Sinh
HA NOI (VNS) — Vietnamese rice exporters, such as An Giang Import-Export Company (AGM) and Vinh Long Cereal and Food Corporation (VLF), face being delisted from the stock market if they continue to suffer losses this year, Dau Tu Chung Khoan (Securities Investment) magazine reported yesterday.
Last year, AGM recorded a net profit of VND5 billion (US$238,000), just 20.83 per cent of its yearly goal and a 83.87 per cent drop from 2013. VLF came out in the negative with a loss of VND38.5 billion ($1.83 million) last quarter and a yearly loss of VND47 billion ($2.24 million).
The two rice exporters borrowed large loans on small equities, a generally risky fiscal move. AGM borrowed VND339 billion ($16.1 million) when its equity was VND345 billion ($16.4 million). VLF borrowed VND231 billion ($11 million) with an equity of just VND92 billion ($4.38 million).
Another rice exporter, Dong Thap Trading Corporation (FDG), was already delisted from the HCM City Stock Exchange last May once its losses exceeded its chartered capital. Last year, FDG recorded revenues of VND300 billion ($14.3 million), one-third of 2013's number.
This year, these three exporters, and others, will continue to face challenges as Thailand plans to export an additional seven-million tonnes of rice.
The Viet Nam Food Association (VFA) blamed Vietnamese rice exporters' losses on the dropping global price of rice. VFA reported that Viet Nam's average price of five-per-cent broken rice was US$439 per tonne last year, higher than comparable rice in Thailand.
At the moment, the VLF stock is marked as a Designated Security on the HCM City stock market.
AGM this year set an optimistic revenue target of VND2.24 trillion ($106.6 million), an increase of 27 per cent, and a net profit of VND23.3 billion ($1.1 million), nearly fivefolding last year's number. — VNS