An Phat Xanh Plastic JSC (AAA) first quarter loss in 7 years

An Phat Xanh Plastics (AAA) records first quarter of loss in 7 years

An Phat Xanh Plastic Joint Stock Company (Code AAA) was established in September 2002, formerly Anh Hai Duy Company Limited, with business activities mainly revolving around the production of plastic film products, plastic bags, food bags, nylon films... In the past time, An Phat Xanh Plastic has continuously recorded negative signals in business activities at the end of 2022.

Specifically, the revenue recorded in the fourth quarter of 2022 of An Phat Xanh Plastics reached 3,415.8 billion VND, down 18.5% compared to the fourth quarter of 2021. Of which, the cost of goods sold still accounted for a large proportion of up to 3,406.6 billion VND, causing the gross profit to be almost completely eroded, only recorded at 34.3 billion VND, down more than 11.1 times compared to the same period last year. Financial revenue in the period reached 77 billion VND, up 23.2% over the same period.

An Phat Xanh Plastic JSC AAA first loss in 7 years annual profit drops to record low picture 1 — An Phat Xanh Plastics (AAA) recorded its first loss-making quarter in 7 years (Photo TL)

Although financial revenue increased, financial expenses also increased sharply from 60 billion VND to 85.4 billion VND, an increase of 42.3%. Business management expenses increased from 58.1 billion VND to 74.3 billion VND, an increase of 27.9%. Meanwhile, sales expenses decreased by nearly half, from 253.5 billion VND to only 129.4 billion VND.

After deducting taxes and expenses during the period, An Phat Xanh Plastics' profit recorded a loss of up to 152.8 billion VND. The main reason was the high cost of goods sold combined with a sharp increase in expenses payable during the period, especially financial expenses. The business results of this fourth quarter marked the first loss-making quarter for An Phat Xanh Plastics in the past 7 years.

2022 profit falls to 7-year low

Not only did the Q4 business results decline, but the business situation in 2022 also recorded a not-so-positive signal. Specifically, by the end of Q4 2022, An Phat Xanh Plastics' accumulated revenue reached VND 15,289.4 billion, an increase of 16.3% compared to 2021. Profit after corporate income tax in the first 9 months of the year was relatively good, but was pulled down by the poor results of Q4 to only VND 113.6 billion, down 64.9% compared to the performance in 2021.

Compared to the after-tax profit achieved in previous years, the profit in 2022 is the lowest level that this unit has ever achieved since 2015. Previously, An Phat Xanh Plastics also recorded a profit of 40.5 billion VND in 2015 but then gradually increased before continuing to decline in 2022.

Notably, the decline in profits in 2022 occurred when this unit reached an unprecedented high revenue threshold. This shows an unreasonable business operation as well as the difficulty in the high cost of capital that An Phat Xanh Plastic is facing.

Inventory increased sharply, structure of long-term financial investments increased

Regarding the asset structure of An Phat Xanh Plastics, at the end of the fourth quarter of 2022, this unit recorded total assets at VND 10,781.3 billion, a slight increase compared to the beginning of the year. However, cash and cash equivalents decreased from VND 1,988.2 billion to only VND 1,655.5 billion, equivalent to a decrease of VND 332.7 billion.

In contrast, inventories increased sharply from VND997.4 billion to VND1,776.3 billion, an increase of 78%. The index of long-term financial investments also increased from VND569.9 billion to VND1,494.1 billion, showing that the company is increasing financial investments in joint ventures and associates.

Regarding the capital structure, An Phat Xanh Plastics's liabilities were recorded at VND 4,613.7 billion, not much fluctuation. Of which, the main debt was short-term debt, accounting for VND 3,195.2 billion, long-term debt accounted for VND 1,418.5 billion. Owner's equity increased sharply from VND 5,454.4 billion to VND 6,167.6 billion, mainly from owner's capital contribution and capital surplus.

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