The PAN Group reports slump in business due to pandemic

Tuesday, May 05, 2020 09:00

At a cashew processing plant of Lafooco, a subsidiary of the PAN Group. — Photo courtesy of the company

The PAN Group has reported revenues of VND1.28 trillion (US$55.1 million) and profits after tax of VND28.7 billion ($1.2 million) in the first quarter, year-on-year decreases of 20 per cent and 60 per cent, respectively.

It blamed the results on the impacts of the COVID-19 pandemic and unfavourable natural conditions such as saltwater intrusion in the Cuu Long (Mekong) Delta, hail and tornadoes in the north and severe drought in the Central Highlands.

The seed and confectionery businesses suffered the biggest sales declines of 35 per cent and 30 per cent mainly due to the impact of the pandemic on selling, travelling and marketing.

The company’s corn exports to major markets including Laos, Cambodia and China were disrupted because of closed borders to control the outbreak.

Prolonged drought has led to a sharp decline in the arable area, especially in the Central Highlands. The Tet holiday came slightly early this year and too close to the New Year, affecting the company’s confectionery revenues compared to a year ago.

The highlight of the company’s activities was the continued growth in cashew exports to Japan, helping the segment's profits to increase slightly.

It has developed dried fruit products, the shrimp segment achieved the same result as last year and the fish sauce segment saw profits increase by 11 per cent.

The company makes a wide range of products for both domestic and export markets, and its export markets are spread relatively evenly geographically.

Its production and business activities were impacted by the pandemic but not disrupted because of its closed value chain.

To deal with the effects of the pandemic, it actively monitors the situation and plans for various possible scenarios.

It bought back treasury stocks when their price dropped to the lowest level in four years.

While it deployed measures to cut costs, it did not reduce its payroll.

Production and business are expected to recover gradually by the end of the year as the pandemic comes under control, social distancing is eased and the food and agriculture sectors enter their peak business season. — VNS

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