Vinatex predicts 50 percent drop in profit before tax this year hinh anh 1Production at the Dong Xuan Knitting Company, a Vinatex member. (Photo:

Hanoi (VNS/VNA) – The Vietnam National Textile and Garment Group (Vinatex), stock code VGT, predicts its consolidated profit before tax this year to fall by half to 382 billion VND (16.5 million USD) year on year due to the negative impacts of the COVID-19 pandemic.

This is the lowest consolidated profit before tax over the past four years, according to Vinatex.

Its business reports for its annual general meeting of shareholders this year have also revealed that its consolidated revenue is estimated at 14.64 trillion VND, down 27 percent compared to last year.

Vinatex said the reductions were due to the impact of the COVID-19 pandemic on its member companies' production and business.

In the report, Vinatex has targeted this year’s revenue of the parent company at about 1.33 trillion VND, down by 5 percent and profit before tax at 130 billion, down by 56 percent compared to 2019 because of difficulties in production and business during and after the pandemic.

Tran Quang Nghi, chairman of the Vinatex board of directors, said in the 2020-25 period, the group must adjust its development strategy because it faced competition in technology but not in price 10 years ago.

In its development plan for this period, Vinatex would promote mergers and acquisitions, and restructure its businesses because the group's current business and production model will become inefficient.

Accordingly, the group would renew management and business models, as well as technology and products. Besides continuing divestment, it would also buy shares of other companies as well as invest in newly-established enterprises necessary for the development strategy.

Vinatex's consolidated revenue in 2019 reached 20.14 trillion VND, similar to 2018, fulfilling 91 percent of the 2019 plan. Its profit before tax was 765.5 billion VND, or 91.2 percent of the yearly plan and up 0.5 percent over the same period last year.

With these business results, the Board of Directors has submitted to shareholders the cash dividend payment plan at a rate of 5 percent with a total payment of 250 billion VND.

According to the General Department of Customs, in the first five months of this year, the domestic textile and garment industry saw a year on year reduction of 13.6 percent in total export value to 10.56 billion USD due to the impacts of the pandemic.

However, this export value in May surged by 16 percent to 1.87 billion USD against the previous month.

In the first five months, the US remained the largest textile and garment export market of Vietnam, with an export value of 4.84 billion USD, down by 14.9 percent over the same period last year.

Japan was the second largest export market with a value of 1.39 billion USD, down by 4.1 percent and the EU ranked third with an export value of 1.26 billion USD, down by 19 percent./.