Dien Quang Light Bulb to become technology solution provider

Tuesday, May 12, 2020 16:20

Chairman Ho Quynh Hung introduces smart products the firm will concentrate on in the future. — Photo courtesy of the firm

Profits of Dien Quang Light Bulb (DQC) last year fell to their lowest level in 10 years at VND27 billion (more than US$1.1 million) and would fall more this year, attendees were told at the firm’s annual general meeting of shareholders in Ha Noi.

Due to the COVID-19 pandemic, the light bulb producer divided the 2020 business plan into two scenarios. In the first, if the pandemic was under control and the firm returned to normal operations in Q3, it estimated revenue of VND610 billion, a reduction of 26 per cent and profit before tax of VND1.86 billion, a strong decrease of 95 per cent from 2019.

In the second scenario, if the pandemic persisted beyond Q3 and the firm could return to normal by Q4, the revenue would decrease by 35 per cent to VND543 billion and the firm expected to see a loss of VND9.6 billion in profit before tax.

In the meeting last Friday, the firm also planned to review and cut costs by at least 20 per cent and would not pay dividends in 2020.

By the end of Q1, DQC recorded net revenue of VND191 billion and net profit of VND3 billion, reductions of 15 per cent and 65 per cent respectively from Q1, 2019.

The firm said lower results were due to the impact of COVID-19 on its increasing finance for long-term investments, administration costs and technology while the price of shares plummeted.

DQC Chairman Ho Quynh Hung told shareholders: “We need to suffer losses to spend on technology for the future.”

Established in 1973, DQC is one of the largest light bulb manufacturing and lighting equipment producers in the country. However, in recent years, its business has continuously decreased due to fiercer competition and declining demand. Normal light bulbs have been replaced by LEDs and other smart products.

At the meeting, the firm’s leaders said it will transform from a pure light bulb producer into a smart light solution provider. To do it, the firm has been building a the high-tech Dien Quang factory, restructuring its distribution system as well as spending more on R&D of smart products.

On May 12, shares of the light bulb producer closed down 0.8 per cent at VND17,550 each on the Ho Chi Minh Stock Exchange. — VNS

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