Covid dampens big companies’ profits

After strict social distancing was imposed in major cities electronics retailer Mobile World (MWG) saw profits for the month fall by 29 percent year-on-year to VND230 billion ($10.08 million) as it had to shut down or operate at reduced capacity nearly 2,000 stores, or 70 percent of its total number.

However, revenues were up 10 percent to nearly VND9.5 trillion thanks to rising sales at its grocery chain Bach Hoa Xanh.

Jewelry company Phu Nhuan (PNJ) posted a loss of VND32 billion while revenues plunged 63 percent to VND490 billion.

It was the first monthly loss this year for this otherwise highly profitable company.

It has had to temporarily close 274 stores, or 80 percent of the total number, due to social distancing orders.

Garment company Thanh Cong Textile Garment Investment Trading Jsc (TCG) saw profits plunging 47 percent to VND15.3 billion as revenues edged down by 3 percent to VND330 billion.

Binh Minh Plastics (BMP) posted its first monthly loss of the year as revenues fell 39 percent year-on-year and factories operated at 15-20 percent of normal.

With plastics not being essential goods, it faced transportation blockages, which added to costs.

The company expects revenues this month of not more than VND75 billion as against an earlier target of VND500 billion.

Stock brokerages expect the third quarter to be a challenging time for businesses, especially retail.

Dragon Capital warned Vietnam could record its lowest GDP growth rate in years.