Vietnam’s top shrimp producer, Minh Phu Seafood, is planning to earn higher profit from its own farms this year, thanks to a large-scale expansion of its farming footprint.
The company is predicting a profit before tax of VND 994 billion (USD 42.6 million, EUR 37.7 million) in 2020, which would be a 99.4 percent increase from 2019. This includes VND 554 billion (USD 23.7 million, EUR 21 million), or 55.7 percent of the total, from its subsidiary Minh Phu Ca Mau; VND 252 billion (USD 10.8 million, EUR 9.6 million), or 25.4 percent, from Loc An and Kien Giang farms; and VND 147 billion (USD 6.3 million, EUR 5.6 million), or 14.8 percent, from subsidiary Minh Phu Hau Giang, according to a report prepared for its annual stakeholder meeting scheduled later this month.
Its net profit this year is projected at VND 915 billion (USD 39.2 million, EUR 34.7 million), up 105.8 percent from last year.
While operations at the processing plants in Minh Phu Ca Mau and Minh Phu Hau Giang have been stable for years, the ongoing expansion at the company’s major farms at Loc An and Kien Giang will make a difference this year, Minh Phu Chairman and CEO Le Van Quang told SeafoodSource on Wednesday, 17 June.
Last year, Minh Phu incurred a loss of more than VND 10 billion (USD 420,000, EUR 380,000) from Loc An and Kien Giang due to limited and costly output from its high-tech farming, or the “2-3-4 technology” method, and high depreciation expenses.
But this year the company will farm on around 1,000 high-tech ponds at the two farms, up from 150 ponds in 2019.
The expansion will continue next year. In the 302-hectare Loc An farm, for example, Minh Phu will raise shrimp via the “2-3-4 technology” in all 1,500 ponds there in 2021, Quang said.
In a meeting on 21 February, Minh Phu’s board of directors approved a plan to produce 63,000 metric tons (MT) of shrimp, gain an export value of USD 709 million (EUR 627.4 million) and earn a profit before tax of VND 1.368 trillion (USD 58.6 million, EUR 51.9 million) this year. But it clarified that the company has not taken into account impacts from the COVID-19 outbreak by the time the goals were set.
All of the targets have been adjusted to reflect the new business environment. Apart from the new profit plans, Minh Phu now plans to export 56,700 MT of shrimp and earn an export value of USD 638 million (EUR 564.6 million) this year, both of which are lower than the targets set in February.
Minh Phu’s export value last year was at USD 643.7 million (EUR 569.6 million), a decline of 14 percent year-on-year, including nearly USD 246 million (EUR 217.7 million) from the U.S., down 20 percent; USD 132.6 million (EUR 117.3 million) from Japan, 13 percent lower year-on-year; and USD 62.8 million (EUR 55.6 million) from Canada, down 10 percent from 2018.
