Mobile World (MWG) has not announced a profit for 7 consecutive months, just escaped a loss in Q2

Mobile World (MWG) is one of the companies that regularly and fully discloses its business results on the Vietnamese stock exchange. Not only does it publish quarterly financial reports in accordance with state regulations, MWG also publicly updates its monthly business results to investors.

However, MWG’s business results in recent months have recorded an unusual point. The company has not announced its profits for many consecutive months, but only reported its revenue results.

In the first half of 2023, MWG recorded a 20.1% year-on-year decline in net revenue. In July, the company continued to record a 19% decline in revenue. In total, in July, MWG's revenue reached VND66,490 billion. Cumulative revenue in the first 7 months of the year only completed 49% of the yearly plan.

7 months of Mobile World MWG did not announce Q2 profit, lost money, deposited image 1 — Mobile World (MWG) has not announced any information for 7 consecutive months (Photo TL)

The Mobile World and Dien May Xanh chains recorded revenue of 48.3 trillion VND in the first 7 months of the year, down 26% year-on-year. In July alone, the revenue of the two chains decreased by 20% year-on-year.

For the Bach Hoa Xanh chain, cumulative revenue in the first 7 months of the year was recorded at 16.5 trillion VND, up 9% over the same period. In July 2023 alone, revenue was recorded at 2.8 trillion VND, up 20% over the same period.

This July, MWG continued not to announce its monthly profits as it had done before. This change began in early 2023 when MWG's business results showed a clear decline.

Estimated profit for the whole year decreased by 80%, in the first 6 months alone, profit decreased by 98%.

MWG's declining business results have started since the beginning of 2023. In the first quarter, MWG recorded a profit after tax of VND 21 billion, down 98% year-on-year.

Entering the second quarter, the gloomy situation continued to increase when consolidated net revenue reached only VND 29,465 billion, down 14.2% compared to 2022. Profit after tax was only VND 17 billion, down 98% compared to the second quarter of 2022.

MWG's severe decline in business results was predicted by some securities companies, but it seems the situation is much more serious.

Specifically, BVSC Securities in a market report forecast that MWG's after-tax profit in 2023 will be only 1,231 billion VND, down 80% compared to 2022. However, both Q1 and Q2 business results decreased by 98% compared to the same period. This further shows that MWG's profit decline is more severe than BVSC's previous forecast.

The second half of the year's business plan lacked a breakthrough, the company escaped losses thanks to interest on deposits.

In its business plan for the last months of the year, MWG said that chains such as Mobile World, Dien May Xanh and Topzone are following a good price strategy to meet customers' saving needs. MWG's leaders assessed that this is a difficult time for consumers, so spending needs will be limited.

The Bach Hoa Xanh chain will aim to improve the quality of fresh products to increase the frequency of customers returning to shop. As for the An Khang Pharmacy chain, MWG has no plans to expand this chain this year.

It can be seen that MWG's business plan does not have a specific breakthrough direction in the last months of the year.

Another notable point is that in the most recent second quarter, the company recorded a relatively strong growth in financial revenue, from 298 billion to 585 billion VND, mainly thanks to interest on deposits. Interest on deposits helped financial revenue increase by nearly 300 billion VND in the second quarter. Meanwhile, the second quarter profit only reached 17 billion VND. Thus, if not for this profit, MWG's second quarter business results would have been a huge loss.

Source