Vincom Retail (VRE) forecasts 2020 profit down 12 per cent due to pandemic
Shareholders in Vincom Retail have agreed with the company’s 2020 net profit target of VND2.5 trillion (US$107.3 million), a drop of 12 per cent over 2019 due to the COVID-19 pandemic.
Total revenue for the whole year is targeted at VND9.9 trillion, up 7 per cent year-on-year.
Chairwoman Thai Thi Thanh Hai said the disease had affected customers’ spending habits while social distancing had disrupted retail activity at shopping centres.
Ending March, Vincom Retail recorded revenue of nearly VND1.7 trillion and net profit of VND492 billion, down 26 per cent and 19 per cent year-on-year, respectively. It also closed 23 centres in HCM City and Ha Noi out of the 79 centres it has across the country from March 27 and April 22.
The company said it would not reduce rents in the long-term but instead share the difficulty with customers with a support package worth VND600 billion to help tenants that had to close during the lockdown period.
This year, Vincom Retail will try to stimulate consumption while focusing on opening new megamalls with the target of having 158 shopping centres by 2026.
In addition, the company will start leasing and operating a new business model of shopping tourism with the Grand World Phu Quoc complex. With 1,000 shophouses and hotel services, Tran Mai Hoa, general director of Vincom Retail, hopes the combination of tourism, shopping and recreation will offer customers and retailers a new experience and help boost the national economy.
Responding to the company’s plan to issue bonds worth total VND4.3 trillion this year, its finance director said the company had cash and cash equivalent of VND3 trillion to meet all current investment needs. The plan was designed to prepare cash for new opportunities or be used for projects that have already gone into operation.
Vincom Retail reported total revenue of VND9.26 trillion in 2019, most of which came from leasing real estate and related services worth more than VND7 trillion. Profit after tax reached VND2.85 trillion, up 18 per cent year-on-year.