Agrico mainly grows passion fruit, banana, and dragon fruit for domestic consumption and exports. Photo by VnExpress/Phuong Dong.
HAGL Agrico reported a VND990 billion ($42.53 million) net loss in the third quarter, its fifth straight quarter in the red.
It represented a 191 percent increase year-on-year as revenue halved to VND495 billion ($21.26 million), according to the latest consolidated financial statement from the company, formally known as Hoang Anh Gia Lai Agrico.
Fruit sales, which accounted for 69 percent of the revenue, fell by more than half to VND342 billion ($14.69 million). The other sources of revenue were agricultural materials and rubber.
The company ascribed the revenue slump to three main reasons: the sale of three rubber subsidiaries to Thadi, the agricultural unit of leading automaker Truong Hai Auto Corporation (THACO), floods during the banana harvest season in Laos which destroyed around 1,200 hectares and the cessation of its chili, beef and real estate businesses.
On the expenses side, it had to write off part of the value of its oil palm and rubber plantations since it has converted them into fruit orchards.
In the first nine months HAGL Agrico reported losses of over VND1.74 trillion ($74.75 million), six times the figure from a year earlier.
It had over VND24.8 trillion ($1.07 billion) in assets.
But despite poor results, Doan Nguyen Duc, chairman of HAGL Agrico’s parent company Hoang Anh Gia Lai (HAGL), said with investment and support from THACO in the past year the agricultural company has overcome “the crisis” and is entering a phase of steady growth.
Duc said he had pleaded with Tran Ba Duong, the THACO chief, for investment at a critical time when HAGL lacked the funds to grow fruit trees and debts fell due.
According to THACO’s financial statements, this year the company has injected over VND6.8 trillion ($292.15 million) into HAGL by acquiring shares in the company and its subsidiaries. It had invested some $1 billion in 2018.
THACO owns a 35 percent stake in HAGL Agrico.