Parkson did not lose money despite the closure of a series of shopping centers

25/05/2017   Viewed: 578
Parkson's operation in the Vietnam market is still extremely bleak when the first quarter loss of nearly 20 billion. This fiscal year, retail giant lost nearly 50 billion after 9 months.

Parkson Retail Asia is the parent company with two subsidiaries in Vietnam: Parkson Hai Phong Co., Ltd and Parkson Vietnam Co., Ltd. Parkson Vietnam is comprised of two subsidiaries namely Parkson Vietnam Service Management Limited Company and Parkson Hanoi Limited Liability Company.
Parkson Hanoi is the management unit of two commercial centers (Parkson Keangnam) and Parkson Viet Tower. However, both commercial centers are now closed, respectively at 1/2015 and mid-December 2016. In 2016 is also the time Parkson to close Parkson Paragon in Ho Chi Minh City.
However, despite the closure of the shopping centers, Parkson did not escape losses in Vietnam.
According to data from Parkson Retail Asia, which owns Parkson in Vietnam, sales in Vietnam in the first three months of 2017 were only about VND122 billion, down about 15% over the same period in 2016 and continuing. Continuing losses of about 19 billion. The big retailer has bitterly admitted: "The retail environment in Vietnam is very difficult in the context of increasingly crowded market."
Parkson Retail Asia fiscal year is from July to June of the following year. Thus, after nine months of this fiscal year, Parkson only reached about 375 billion revenue and a loss of 50 billion.
 
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Chart of Parkson business results in Vietnam

Earlier, in 2015, the company's loss of up to 850 billion, causing shareholders of parent company Parkson Retail Asia to receive a large financial shock. Parkson Hanoi is the main reason to cancel the lease at Keangnam Landmark 72 before the deadline. It is known that the cost of canceling the contract amounted to more than 1,000 billion. However Parkson Hanoi still has to accept to "avoid further losses due to the challenges of the retail market."
 
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Parkson's fiscal year is from the time of the month

7 and ends in June next year
Because of the huge losses, Parkson decided to withdraw its capital at Parkson Hanoi, selling 31% of its capital. As a result Parkson's shareholding fell from 76% to 45%, losing control, and Parkson Hanoi was transformed into an associate company.
The move of Parkson Hanoi from its subsidiary to its associate company is believed to be a good financial report for its Parkson parent company, as Parkson will not have to record huge losses from Parkson Hanoi on its financial statements. This is also the reason Parkson profits soared back in Vietnam market,

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