Chilled meat processing line in Ha Nam facility. MEATDeli, Masan MEATLife's chilled meat brand, delivered VND69 billion in the third quarter, four times higher compared to the second quarter of this year. – Photo courtesy of Masan Group
Masan Group has reported its net profit in the third quarter this year soared to VND2.23 trillion (US$96 million), a three-fold increase against the same period last year.
The jump was driven by a financial gain of nearly VND1.65 trillion ($71 million) from the settlement of an international arbitration case between Nui Phao Mining Processing Company (NPMC) and Jacobs E&C.
The Australian subsidiary of Jacobs Group completed the payment of $130 million to NPMC, a subsidiary of Masan Resource. The one-time settlement helped triple Masan Group’s net profit after tax post-minority interest (NPAT Post-MI) to VND2.23 trillion from VND748 billion earned in the same period last year.
Consolidated net revenue of the group in the last three months was down 2.2 per cent to VND8.97 trillion.
Ending September, Masan Group’s total net revenue decreased slightly 0.9 per cent to nearly VND26.38 trillion ($1.13 billion) from VND26.63 trillion in same time 2018.
However, the nine-month NPAT Post-MI reached VND4.11 trillion ($176.4 billion), up 8.7 per cent year-on-year.
The decline in revenue was attributed to lower pig feed sales due to African swine fever which killed around 20 per cent of Viet Nam’s pig population. In addition, revenue of Masan Resources, one of its big subsidiaries, also fell due to depressed tungsten prices and no copper sales.
According to the company, tungsten prices had climbed back up to $225-245 per MTU from $180-195, and Masan Resources expected to sell copper stock in the last quarter.
Meanwhile, strong growth of Masan MEATLife (MML) and Masan Consumer Holdings (MCH) contributed significantly to Masan Group’s profit.
MEATDeli, MML’s chilled meat brand, delivered VND69 billion in the third quarter, four times higher compared to the second quarter of this year. As of September, monthly net revenue had increased by 31 per cent since June 2019. The company hopes to increase net revenue to VND100 billion in December, or an annualised net revenue of VND1.2 trillion.
MML had opened 320 cold chain points of sale in Ha Noi and HCM City as of October compared to 116 at the end of June. The company expects to expand its network to 650+ by year-end, only trailing Bach Hoa Xanh and VinMart.
The company will broaden its meat portfolio with chilled processed meat innovations in November. Processed meat will be a key growth driver following the success of Masan Consumer’s processed meat category, which grew two times compared to 2018.
MML is planning to list on the Unlisted Public Company Market (UPCoM) in the last quarter of this year.
Meanwhile, Masan Consumer Holdings is investing in sales and SG&A to launch innovations and drive medium term growth. The company expects beverages and its premiumisation strategy to become a larger contributor and drive top and bottom line back to double digit growth.
Beverages witnessed 35.4 per cent growth in the last quarter, backed by 41.4 per cent growth in energy drinks and 21.7 per cent growth in bottled water during the same period. In nine months, beverages delivered 29.4 per cent top line growth compared to the same period last year. VNS