Vietnam’s cement giant Vicem logs over $55 mln loss in 2024

Vietnam National Cement Corporation (Vicem) has suffered losses for the second consecutive year, with an estimated consolidated figure of VND1.4 trillion ($55.15 million) for 2024, according to a draft annual report by the Ministry of Construction.

Vicem, a state-owned enterprise under the Ministry of Construction, has been in operation for 45 years. It manages 10 factories nationwide housing 16 production lines with an annual capacity of 20 million tons of clinker and 27 million tons of cement. The corporation is known for its popular cement brands, including Ha Tien, Hai Phong, Bim Son, Hoang Thach, But Son, and Hoang Mai.

Vicem is the only among six firms under the ministry to report losses in 2024, with consolidated loss of VND1.4 trillion ($55.15 million) due to unfavorable market conditions. Its parent company’s loss reached VND236.8 billion ($9.33 million). However, these figures were still lower than Vicem's targets by VND177.5 billion ($6.99 million) and VND59.6 billion, respectively.

This marks the second consecutive year of losses for the cement giant. Last year, Vicem reported its first-ever loss of approximately VND1.13 trillion ($44.5 million) due to a sharp drop in demand since the 2016 economic slowdown. At the end of 2023, the company's cumulative losses totaled about VND2.24 trillion ($88.24 million).

Last month, the Ministry of Finance's inspection department released a conclusion on Vicem's performance, highlighting potential risks of capital loss in several of its subsidiary investments, which had required provisions of more than VND3 trillion ($118.2 million). The inspectors have urged Vicem to review and assess the financial situation of its underperforming businesses.

Earlier, Vicem and its three subsidiaries, namely Vicem Tam Diep Cement Company Limited, Vicem Hai Phong Cement Company Limited, and Vicem Ha Tien Cement Company Limited, were put under inspection per a decision by the Ministry of Finance's chief inspector.

The inspection covered management and use of capital and assets at the enterprises; accounting of revenues and expenses, and business reports; fulfillment of obligations to the state budget; and compliance with legal regulations on finance in 2023.

Meanwhile, the remaining five enterprises under the Ministry of Construction, namely Viglacera, Hancorp, Lilama, HUD, and Coma, have performed beyond their year targets.

Among them, Viglacera achieved the best results, with a consolidated profit of VND1.5 trillion ($59 million), surpassing its target by VND400 billion.

Hancorp posted a consolidated profit of VND84.25 billion ($3.3 million). Lilama, HUD, and Coma earned respective profits of VND70 billion, VND386 billion, and VND14.15 billion.