Japanese retailer Aeon earned operating revenues of JPY7,155 million ($48.3 million) in Vietnam in the first half of fiscal year 2023 (March-August 2023), up 20.7% year-on-year.
In its quarterly report, the retailer said its operating income in Vietnam for the six-month period rose 36.6% to JPY1,992 million ($13.4 million). The figure was the company’s highest among ASEAN members and the second-highest overseas market, only behind China.
Notably, among its overseas markets including China, Vietnam, Cambodia and Indonesia, Aeon only recorded a higher year-on-year income in Vietnam.
Globally, Aeon earned an operating income of JPY24,428 million ($164.1 million) on an operating revenue of JPY210,807 million ($1.42 billion), up 7% and 8.6% year-on-year, respectively.
As a result, Vietnam accounted for 3.4% of Aeon's global operating revenue and 8.2% of operating income in the six-month period.
Japan, its home market, accounted for the biggest portions at JPY18,198 million ($122.2 million) and JPY167,684 million ($1.13 billion), respectively.
Reviewing its Vietnam performance, Aeon said it recorded impressive growth despite sluggish external demand and slowing economic growth, not to mention power shortages in the period.
From late May to late June, Hanoi and many other northern localities experienced power cuts due to soaring demand in the hot season. The situation was caused by a fall in hydroelectricity output due to drought conditions and supply disruptions at thermal power plants because of problems like shortages of coal.
Versus fiscal year 2019, the peak of the Covid-19 pandemic, Aeon’s sales in Vietnam increased 44.2%, demonstrating continuous strong growth, the retailer said.
It also pointed out challenges in line with the country’s slow economic growth, particularly a high unemployment rate among the youth, which partly led to specialty store sales at existing mall going down 2% and 0.8% year-on-year in July and August, respectively.
Per its medium-term (2023-2025) plan, the company will open more outlets in Vietnam, including one in the central province of Thua Thien-Hue. Construction of Aeon Mall Hue began in February and a grand opening is planned in the second half of 2024.
There are six Aeon Mall outlets in Vietnam: two each in Hanoi and Ho Chi Minh City; and one each in the southern province of Binh Duong and northern city of Hai Phong.
The retailer has so far invested more than $1.18 billion in Vietnam, Aeon Group executive chairman Akio Yoshida said at a meeting with Vietnamese Prime Minister Pham Minh Chinh in Japan’s Hiroshima last May.