Cinema chain from Korea CGV belongs to CJ Group has just announced the third quarter financial report with the revenue of the whole cinema complex of approximately 300 million USD.
Specifically, thanks to the post-Covid-19 demand recovery in Korea and Southeast Asia (Vietnam and Indonesia), CGV collected 405 billion won, approximately 300 million USD, in the last quarter. This number increased by 150% year-on-year and 25% compared to the previous quarter.
The sudden growth in revenue helped the cinema chain’s gross profit reach 153 billion won, equivalent to 113 million USD, up 405% over the same period.
Positive business performance from markets, pulling operating profit to a positive value for the first time since the arrival of Covid-19. This amount of CGV reached 7.7 billion won while the same period last year operating loss of 77.5 billion USD, equivalent to 57.2 million USD.
However, after deducting expenses including corporate tax obligations, CGV still lost 38.3 billion won, equivalent to 28.2 million USD. In the same period last year, the cinema lost more than 90 million USD after tax.
Entering the fourth quarter, CJ CGV expects the blockbuster “Avatar II” to continue to increase revenue. In addition, two markets, China and Turkey, are also forecast to improve operating profit.
CGV recovered strongly after Covid-19. Photo: B.N.
Despite being present in a series of large and populous markets such as Turkey, China, Myanmar, Indonesia, South Korea and the United States, Vietnam is the third highest revenue-generating country, after Korea and China.
In fact, compared to Indonesia, the US and Myanmar, the Vietnamese market has an overwhelming number of theaters and screens. CGV Vietnam currently operates 81 theaters nationwide with the number of screens 475.
Last quarter, CGV Vietnam’s revenue reached 45.5 billion won, equivalent to 834 billion VND, up more than 50 times the 900 million won figure recorded last year. However, this growth performance can be fully explained when in the same period last year all cinemas in Vietnam had to close because of the Covid-19 epidemic.
Thanks to this revenue, CGV Vietnam’s operating profit reached 3.4 billion won, equivalent to 62 billion VND. EBITDA coefficient profit (after interest, tax and depreciation) reached 13 billion won, equivalent to 238 billion VND.
According to CGV, the normalization of business after the pandemic along with the success of movies like “Minions 2” and “Suddenly won the lottery” helped boost third-quarter revenue. Besides, the outlook for the fourth quarter is relatively positive when the domestic film market recovers.
CGV officially entered Vietnam market in 2011 after spending 70 million USD to acquire Envoy Media Partners Company (owner of MegaStar cinema complex). Two years later, CJ CGV Korea converted the MegaStar brand into CGV. The theater cluster from Korea has so far held 51% of the nationwide market share.
Before the pandemic, CGV Vietnam’s revenue grew relatively steadily. In 2016, the chain’s net revenue reached 2,140 billion VND, gross profit of 369 billion VND, gross profit margin reached about 17%. The company’s profit after tax reached 93 billion VND.
In the period 2017-2018, the company’s net revenue gradually improved, reaching 2,623 billion VND and 2,880 billion VND, respectively, and gross profit respectively 466 billion VND and 351 billion VND. The business reported a profit of 106 billion VND in 2017 but a loss of 38 billion VND in 2018.
In 2019, CGV’s revenue grew 29%, reaching 3,708 billion VND, reporting a profit of 122 billion VND, the highest level since its establishment.
@ Zing News
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Source: Vietnam Insider