Retailer Petrolimex posts 45% profit drop year-on-year

Petrolimex, Vietnam's biggest gasoline retailer by market share, announced consolidated pre-tax profit of an VND2,068 billion ($88.23 million), down 45% year-on-year but seven times higher than its adjusted target.

The corporation's total consolidated revenue reached VND300,000 billion ($12.8 billion), exceeding its plan by 25% and up 78% year-on-year, according to information provided at its year-end conference.

In November, Petrolimex had asked for shareholder approval to reduce its pre-tax profit target in 2022 from VND3,060 billion ($130.6 million) to VND300 billion ($12.8 million) due to "force majeure". The reason behind the adjustment was the global gasoline market situation, the company explained.

This means its actual pre-tax profit in 2022 was 6.9 times higher than the adjusted target.

In 2022, the group's total semi-consolidated production volume reached 13.7 million cubic meters per ton, exceeding its target by 13% and up 11% year-on-year. Petrolimex also spent VND1,647 billion ($70.27 million) to invest in technical facilities.

Pham Van Thanh, chairman of Petrolimex, said that difficulties will remain in 2023 with the risk of a global economic recession. Global economic growth is forecast to reach about 2%, significantly lower than 2022 and the average during the decade before the Covid-19 pandemic.

The World Bank, in its latest Global Economic Prospects report released last Tuesday, cut its 2023 global GDP growth forecast to 1.7% from a projection of 3% in June, marking a sharp slowdown from the estimated 2.9% growth for 2022.

The bank expects Vietnam to be the fastest-expanding economy in Asean this year at 6.3%, a little lower than the country's target of 6.5%.

Good GDP growth woud lead to an increase in domestic gasoline consumption demand, Thanh said. "But the gasoline market is forecast to harbor many risks."

Petrolimex will continue to focus on gasoline in 2023 as its core business, while developing a system of petrol stations on highways, main roads and key areas.

In a recent report, top broker SSI forecast that Petrolimex's pre-tax profit in 2023 may increase to VND3,400 billion ($145 million) thanks to oil prices as well as a more stable supply chain.

On the Ho Chi Minh City Stock Exchange, Petrolimex (PLX) shares hit VND37,050 ($1.58) on Friday.