Phu Nhuan Jewelry Joint Stock Company (HoSE: PNJ) recently announced its business results for the first 5 months of 2023. Accordingly, in the first 5 months, the company recorded revenue of VND 14,281 billion, and profit after tax of VND 970 billion, down 8.4% and 3.5% respectively over the same period.
According to the report, in May 2023 alone, PNJ recorded net revenue and after-tax profit of VND 2,223 billion and VND 111 billion, respectively, approximately the same as the results of April 2023. With the results achieved in the first 5 months of the year, the company has completed 40.1% of the revenue target and 50.1% of the profit target for the whole year.
Regarding the business activities of each channel, PNJ said that retail jewelry revenue in the first 5 months of 2023 decreased by 8.7% compared to the same period in 2022 due to the market's purchasing power not recovering.
However, with continuous implementation of business strategies and market approaches, PNJ still maintains market share and controls a lower decline than the general market.
Cumulative revenue growth by segment (Source: PNJ).
In addition, wholesale jewelry revenue also decreased by 27% compared to the same period in 2022 due to the decline in domestic jewelry purchasing power and the reduction in orders from PNJ's corporate customers. However, the wholesale channel continued to grow in the number of new customers. Meanwhile, 24K gold revenue only decreased slightly by 1.4%.
In addition, the average gross profit margin for the first 5 months of 2023 reached 19% compared to 17.8% in the same period due to changes in the sales structure. The company's total operating expenses increased by 2.1% over the same period, the operating expense/gross profit ratio increased from 51.7% in 2022 to 54.1% in 2023 due to higher prices due to the impact of inflation.
As of the end of May 2023, the PNJ system has 376 independent stores including 355 PNJ Gold stores, 7 PNJ Silver stores, 3 CAO Fine Jewellery stores, 5 Style by PNJ stores, 3 PNJ Watch stores and 3 PNJ Art stores.
According to the latest report by SSI Research, the analysis team believes that these business results more accurately reflect the reality of the general economy .
SSI sees the company's profits still falling by double digits in Q2/2023 and Q3/2023 as the economic downturn could still impact jewelry consumption. The central bank's rate cut has reduced the policy rate by about 200-300 basis points compared to the beginning of the year, but it will take some time for this move to truly support the overall economy.
Experts expect overall consumption demand to recover in Q4/2023. Therefore, profits may only return to positive growth in Q4/2023 .
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