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Thien Long Group (TLG): Profit down 77% in January 2023 

 Sunday, March 12,2023

AsemconnectVietnam - Thien Long Group Joint Stock Company (code TLG - HoSE) reported estimated business results for the first month of 2023.

In January 2023, Thien Long Group recorded a revenue of VND219 billion, down 9% over the same period and a profit of VND7 billion, down 77% over the same period in 2022. In which, revenue from exports Exports increased by 19% to VND105 billion, contributing 48% of total revenue.
The reason given by the Company was that the Lunar New Year holiday this year took place early and near the previous holiday, which made Thien Long's demand for goods storage low in January. However, the demand for production for export orders are still increasing and are usually concentrated at the beginning of the year, partly explaining the increase in inventories as well as production costs over the same period.
Talking more about the outlook for 2023, the Company said that 2022 has seen a strong recovery of the retail market thanks to the leverage from the overall growth of the economy, the recovery in all areas has returned after the Covid-19 pandemic. However, in 2023, the retail industry will face challenges of inflation, high interest rates affecting consumers' spending decisions.
Essential goods (such as stationery) will be less affected, but there are still short-term risks such as reducing investment and stockpiling at points of sale.
Previously, in the fourth quarter of 2022, Thien Long Group recorded a revenue of VND740.52 billion, down 6.2% over the same period and profit after tax recorded a loss of VND2.78 billion compared with the profit of VND97 billion in the same period of last year. In which, gross profit margin decreased from 44.4% to 40%.
It is known that the last quarter of Thien Long Group's loss was the first quarter of 2020, with a loss of VND19.93 billion. Thus, after experiencing 10 consecutive profitable quarters, the Company returned to a loss in the last quarter of 2022.
During the period, gross profit decreased by 15.5% over the same period, corresponding to a decrease of VND54.22 billion to VND296.27 billion; financial revenue increased by 152.2%, equivalent to an increase of VND15.17 billion to VND25.14 billion; financial expenses increased by 658.8%, equivalent to an increase of VND16.47 billion to VND18.97 billion (recorded at VND2.5 billion in the same period); selling and administrative expenses increased by 35.2%, equivalent to an increase of VND80.22 billion to VND308.41 billion and other activities did not change significantly.
Thus, in the fourth quarter, the Company recorded a loss, mainly gross profit decreased, financial, selling and administrative expenses increased.
The company said that the decrease in revenue in the fourth quarter of 2022 compared to the same period was due to difficulties in the international market, the domestic currency exchange rates of countries fluctuated strongly against the US dollar, so the import of goods was somewhat slowed down. Meanwhile, the fourth quarter of 2021 is a boom period in terms of domestic market revenue as well as export reopening after the gap because of Covid-19.
In addition, the Company also said that the increase in expenses in the fourth quarter of 2022 was due to the company's investment in increasing brand image, increasing domestic competitiveness, strengthening sales support programs at points of sale in the country as well as the international market.
Accumulated in 2022, Thien Long Group recorded a revenue of VND3,520.86 billion, up 32% over the same period and profit after tax recorded VND400.94 billion, up 44.9% over the same period last year.
In 2022, Thien Long plans to increase revenue by 21.8% year-on-year to VND3,250 billion and profit after tax to increase by 1.2% to VND280 billion. It is known that the Company sets its business plan based on the assumption of a scenario where students attend school stably, the market recovers and returns to normal.
Thus, by the end of 2022 with a profit of VND400.94 billion, the Company has completed 143.2% of the annual profit plan.
Source: VITIC/Tinnhanhchungkhoan


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