Vinatex "hit a home run” in a difficult year

Vinatex aims for 8% – 10% growth in exports

Mr. Cao Huu Hieu, General Director of Vinatex spoke at the meeting.

Profit before tax is estimated at VND1,200 billion

2021 has been a difficult year for Vietnam's textile and garment industry. Speaking at a press conference on Vinatex's production, business and worker movement in 2021 on December 23, 2021, Mr. Cao Huu Hieu, General Director of Vinatex, said: “There was a time when it was judged as desperate.”

It is especially difficult for businesses in the southern provinces when they have to implement prolonged social distancing, leading to almost broken production chains.

In the third quarter of 2021, many businesses had to close, workers were not allowed to come to the factory, the delivery schedule was not guaranteed and contracts were fined. As a result, some were shifting to other markets, causing great damage to businesses and slowing down the growth momentum of the whole industry.

From the fourth quarter of 2021, the southern provinces gradually reopened and since the implementation of the Government’s Resolution 128/NQ-CP temporarily regulating "Safe adaptation, flexibility, effective control of the Covid-19 pandemic", striving to bring the whole country to a state of "new normal" as soon as 2021, businesses have bounced back to production.

With the efforts of enterprises, Vietnam's textile and garment industry has overcome difficulties to maintain a good growth momentum in 2021. Typically, export turnover is estimated at US$39 billion, up 11.2% compared to 2020 and up 0.3% compared to 2019.

Making an important contribution to the results of the textile and garment industry in 2021, the operations of Vinatex's units are still maintained effectively, especially the yarn businesses with spectacular growth in both revenue and profit. As a result, the whole group has achieved impressive production and business results.

Specifically, revenue and consolidated income of the group was estimated at VND16,436 billion, equaling 110.7% of the previous year; consolidated pre-tax profit was estimated at VND1,200 billion, equal to 202% of the previous year, reaching 170% of the plan, nearly 70% higher than in 2019 before the pandemic.

Not only achieving good growth rate, Vinatex also expanded investment in building new factories. Remarkably, Yarn Factory 3 (Phu Bai Yarn Joint Stock Company) with a scale of 32,000 spindles was put into operation from June 2021; Yarn Factory 2 (Vinatex Phu Hung Joint Stock Company) with a scale of 22,800 spindles was estimated to come into operation from October 2021.

This is the basis for Vinatex to improve its competitiveness, meet the requirements of rules of origin of free trade agreements (FTAs) such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Vietnam-EU FTA (EVFTA),” Mr. Hieu said.

Building a yarn-textile-dye-garment chain

Regarding why Vinatex maintained its growth rate in 2021, Mr. Cao Huu Hieu said that it is a lesson in prioritizing the preservation of the workforce.

Vinatex always adheres to the motto that employees are the most valuable assets of the enterprise. Thanks to maintaining close links with workers, in the first month of entering the "new normal" state, the rate of mobilization of laborers returning to work reached 85-90%.

Vietnam's textile and garment industry has overcome difficulties to maintain a good growth momentum in 2021 with the export turnover is estimated at US$39 billion. Photo: Nguyen Thanh

"Up to now, Vinatex has regained its entire workforce," said Mr. Cao Huu Hieu.

Speaking about Vinatex's orientation in 2022 with a vision to 2025, Mr. Vuong Duc Anh, Chief of Office of Vinatex's Board of Directors, said that the enterprise realizes that mastering domestic raw materials is the "key" to the more sustainable and certain development in the context of a prolonged pandemic.

Vinatex and its member units continue to promote coordination, build a close chain of yarn-knitting-dyeing-garment, aiming to become “a one-stop destination for customers in the textile and fashion industry”.

The goal for the 2022 – 2025 period is to form a supply capacity large enough for the knitwear industry to meet the initial requirements of the world's large-scale supply chains.

To accomplish the above goal, Vinatex synchronously deploys solutions such as creating linkages in the textile and garment production chain through the group's industrial production scale planning, with the goal of increasing export, providing a full package of products and having a relative balance among the fields.

In particular, the group focuses on digital transformation, considering it a “key” to ensure the successful implementation of strategic goals for the 2022-2025 period.

For market and customer solutions, Vinatex will develop a suitable investment roadmap, determine the market structure and main customers for each type of product, strengthen design and marketing capabilities, and enhance new market development.