March 7, 2014  

 

 

Due to the shortage of shrimp caused by early mortality syndrome (EMS), Vietnam's largest shrimp producer and exporter Minh Phu Seafood saw its sales and profit soar in 2013, as prices and demand shot up.

 

The increase was particularly strong at the end of the year, with the last three months accounting for a third of annual turnover, and 40% of annual operating profit.

 

For 2013, the company reported annual revenues of VND11,206 billion (US$531 million), up by 41%, or some US$154 million, from VND7,965 billion (US$377 million) the previous year.

 

Gross profit rose 30% to VND1,156 billion (US$54 million), from VND886 billion (US$42 million). Net operating profit was up more than 10-fold to VND376 billion (US$18 million), from just VND36 billion (US$1.69 milllion) a year ago.

 

Profit after tax finally ended at VND293 billion (US$13.77 million), compared to just VND15 billion (US$712,500) in 2012.

 

A third of the sales revenue was generated in the last quarter of the year. Sales from October through December 2013 were up 78% on-year, to VND3,809 billion (US$181 million).

 

"Supply source of large export countries decreased because of the EMS epidemic," Minh Phu said in a comment. "Therefore, orders focus to the company, revenue increased 78.27% as compared to the same period of last year."

 

EMS has ravaged production of shrimp in Asia. After a steep drop in 2011, which saw its production nearly halve to just under 300,000 tonnes, Vietnam's shrimp harvest is expected to be stable and possibly increase somewhat in 2013-15, according to forecasts by a GOAL 2013 survey.

 

Operating profit in the last quarter also soared, ending at VND158 billion (US$7.5 million) or 40% of annual profit — from just below VND20 billion (US$949,000) a year ago.

 

The figures are likely a welcome boost for Minh Phu, which had been struggling to cope with high debts caused by its investing more than US$60 million to build its factory in Hau Giang province.

 

The company started seeking investors to invest fresh cash in mid-2012 and reached advanced talks with Charoen Pokphand Foods, but negotiations collapsed late in the year, and the company announced in May 2013 that it would delist from the Ho Chi Minh stock exchange and raise capital privately.

 

In October last year, it then announced that Japan's Mitsui would take a 30.5% stake in Minh Phu's processing subsidiary, Minh Phu Hau Giang Seafood Corp. The price was undisclosed, but Minh Phu had previously said the transaction could raise VND266 billion (US$12.53 million).

 

Commenting at the time, a Minh Phu spokesperson said the company was "still looking for partners for Minh Phu Seafood" and confirmed that its plans to delist the business were still on.