A worker of PVCFC checking equipment at one of its plant. The fertiliser producer is expected to continue struggling in the second half of 2023 due to many international and domestic events. — Photo pvcfc.com.vn

HÀ NỘI — Petrovietnam Cà Mau Fertiliser JSC (PVCFC)’s sales and production still performed well and even exceeded its targets despite strong declines in revenue and profit in the first half of the year.

PVCFC is the leading fertiliser producer in Việt Nam, accounting for more than 60 per cent of the total market share.

In its second quarter financial statement, PVCFC said that its consolidated net revenue declined 19.4 per cent year-on-year to VNĐ3.29 trillion (US$138.2 million), while profit after tax tumbled 71.6 per cent to more than VNĐ289.8 billion. 

For the first six months of the year, PVCFC’s net revenue dropped 26.2 per cent over last year to VNĐ6.03 trillion, with profit after tax posting a decrease of 79.5 per cent to VNĐ519.5 billion.  

The falls were due to higher fuel prices and weaker demand, while fertiliser prices dipped sharply. 

The average selling price of urea products has plunged by more than 37 per cent in the first half of the year compared to the same period last year, while selling expenses increased by more than 26 per cent, according to PVCFC.

Moreover, more fierce competition with imported fertilisers, the oversupply of fertilisers, especially NPK fertilisers, and a not very promising prospect for agricultural outputs also weighed on the business activities of PVCFC during the period.

However, the bright spot was that production and sales of the company’s main product, urea, exceeded the plan.

In the first six months of this year, its urea output was estimated at 101 per cent of the target of Petrovietnam’s General Director and 108 per cent of the plan of Petrovietnam’s Board of Directors.

The urea sales was estimated at 460.000 tonnes, exceeding its target. Of which, 160,000 tonnes were shipped to Cambodia, South Korea, India, and Chile.

The positive results were attributed to the company’s effective sales strategy: maintaining market shares in targeted markets and expanding into new ones.

PVCFC has also actively looked for international markets to promote exports.

Nevertheless, PVCFC still has to face many difficulties in the second half of the year, challenging it to complete the 2023 plan, especially financial indicators like revenue and profit.

The uncertainties of geopolitics, the possibility of a global economic recession, and domestic difficulties will continue to affect fertiliser businesses, requiring producers to always closely watch, evaluate, and forecast to provide flexible solutions for production and business.

In addition, fertiliser prices on the international market are also expected to fluctuate unpredictably in the last months of the year, while the global fertiliser supply is likely to increase, causing a less favourable environment for the export of domestic fertiliser.

On the stock market, PVCFC’s shares are traded on the Hồ Chí Minh Stock Exchange (HoSE). They closed Monday at VNĐ32,250 a share, a gain of 21.7 per cent over the beginning of the year.— VNS