Major Vietnamese rice business Loc Troi Group JSC (LTG) reported record revenues of over VND16 trillion ($651 million) in 2023, a year-on-year increase of 37%.
However, its after-tax profits dropped 36% to VND265 billion ($10.78 million), failing to meet the target of VND400 billion approved by shareholders, according to the group’s financial statement.
In the fourth quarter of 2023, Loc Troi recorded a spurt in revenue at VND5.82 trillion ($236.83 million), up 90% year-on-year, with corresponding gross profit margin improving from 23.9% to 26.2%.
Despite rising financial and sales costs, the rice firm enjoyed after-tax profits of VND247 billion ($10 million) in the quarter, a year-on-year increase of 18%.
Starting out as a plant protection drugs producer, Loc Troi expanded to seeds and food segments. In 2023, its rice segment fetched VND11.23 trillion ($457 million), up 75% year-on-year and contributing 68% of total revenue. However, the profit margin of this segment was low at 2-3%.
Loc Troi was able to partake of the great success in Vietnam's rice exports. According to Vietnam Customs, the country shipped over 8 million tons of rice last year, higher than the average of about 6-7 million tons in recent years. The country’s rice export turnover reached $4.6 billion in 2023, up 35% over the previous year.
Export rice prices also climbed to over $630 per ton at the end of the year. Experts have predicted that rice prices will remain high in 2024 as India, a major world supplier, may continue export restrictions after the elections and the effects of the El Nino phenomenon are likely to last until the middle of this year.
Along with the sharp increase in revenue, Loc Troi's customer receivables in 2023 surged 2.8 times to VND6.48 trillion ($263.68 million). Provision for short-term bad debts was VND564 billion ($22.95 million), more than double the 2022 figure.
The group’s short-term debt saw a sharp spike from VND3.75 trillion to VND6.23 trillion ($253.5 million).
Loc Troi Group JSC is registered on the Unlisted Public Company Market (UPCoM) as LTG, which closed last Friday’s session at VND26,400 ($1.07) per share.