Tire giant Casumina reports first quarterly loss
Tire giant Casumina reports first quarterly loss
Leading tire company Casumina reported a loss of VND28 billion ($1.23 million) in Q3 due to the high costs of housing workers and difficulty selling amid Covid-19.
A mechanic examines a car tire. Photo by Shutterstock/Fusionstudio |
For the Southern Rubber Industry JSC, its formal name, this is the first quarterly loss since its stock market listing in 2009.
Its revenues fell by 21 percent to VND1.03 trillion during the quarter due to the impacts of the pandemic, which also caused the company’s cost-revenue ratio to surge to 92 percent from 80 percent by sending input production and distribution costs soaring and forced it to house its workers on-site.
Its nine-month profit figure was VND7 billion on revenues of VND3.48 trillion, down 88 percent year-on-year and only 17 percent of the year’s target.
Casumina increased borrowing by 26 percent to VND2.55 trillion to cover the cash flow deficit.
The epidemic halted production, especially for exports, and sent logistics costs surging, the firm said.
Competition in the tire market is increasingly fierce from both domestic players and imports from China and Thailand, and the U.S.’s protectionism against Vietnamese tires is also make things difficult, it added.
Casumina had expected revenues and profits to fall by 7 percent and 12 percent from 2020 in its business plan announced in April.
