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Vinamilk reports export fall
Minh Tam
Monday,  Apr 2, 2018,23:20 (GMT+7)

Vinamilk reports export fall

Minh Tam

A customer inspects Vinamilk dairy products at a store in HCMC. Vinamilk has not been able to reverse its export decline since last year - PHOTO: TL

HCMC – Vietnam Dairy Products JSC (Vinamilk) has not been able to reverse its export decline since last year, Vinamilk CEO Mai Kieu Lien said at the firm’s annual shareholder meeting on March 31.

The country’s leading milk processing firm last year saw exports edging lower, Lien said, adding this export situation continued into the first quarter of this year. However, the company has fared well on the domestic market as the demand for organic dairy products has remained strong.

Given the export fall, Vinamilk’s board of directors set its revenue target for this year at VND55.5 trillion (US$2.4 billion), up a mere 8.5% over last year. This target will not put too much pressure on Vinamilk staff.

Shareholders said this was not a high target for a company like Vinamilk. Lien said the company is still uncertain over how its export will play out this year.

Last year, Vinamilk suspended exporting to the Middle East, one of its key buyers, due to political instability there, said a source from the company. Its 10% export growth target for this market did not materialize, affecting its overall export goal.

However, Vinamilk’s total revenue last year was kept unscathed by the strong domestic consumption of products such as powdered milk, milk, dairy products, soft drinks and fruit juice.

Particularly, consumers have high demand for its organic fresh milk which was launched last year.

Therefore, the firm said it will focus on developing organic dairy farms, expanding a farm in Dalat City by importing pregnant cows from Australia and moving cows there to another farm in Di Linh, and developing a herd with 2,000 cows at its farm in Thanh Hoa Province.

The company also plans to open an organic dairy farm in the Mekong Delta city of Can Tho.

In the central region, Vinamilk will buy fresh milk from a Japanese partner with dairy farms in Laos’ Xiangkhouang Province to supply its dairy processing plant in Nghe An Province.

Supplies for organic fresh milk processing will increase in the next two years, Lien added.

Vinamilk looks to make nearly VND10.8 trillion in after-tax profit, up 4.6% against last year. The company will pay a cash dividend equivalent to at least 50% of its after-tax profit.

At the meeting, the board of directors approved Alain Cany, a representative of Jardine Cycle & Carriage Limited (JC&C), as new member of the board in the 2017-2021 tenure.

JC&C acquired more than 48.3 million shares worth nearly VND9 trillion in Vinamilk from State Capital Investment Corporation (SCIC) last year. It is now Vinamilk’s second biggest foreign shareholder after Fraser and Neave (F&N).

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