Viet Nam Sea Transport and Chartering Joint Stock Company (HOSE: VST), which lists on the Ho Chi Minh Stock Exchange with trading name of VST, achieved a healthy earning results last year, but it is still carrying high risks of losses from loans with rising lending rate in 2011, experts worried.


Analysts are concerned that the Ho Chi Minh City-based firm, also known as Vitranschart, was suffering heavy financial expenses, including interest expenses and losses from strong US dollar.
Surging foreign exchange rate combined with high lending costs in the last two months are among the main causes boosting the expense.
In 2010, the financial expense of the maritime company amounted to VND306.4 billion (US$15.32 million), making 15.4 percent out of the total expense and increasing 79 percent year-on-year.
Of the figure, the interest expense increased 50 percent year-on-year to VND153.5 billion, while the loans in dollars made around 74 percent out of the company’s outstanding loan.
Experts estimated that Vitranschart incurred a heavy loss of VND70 billion from the surging dollar-dong exchange rate last March as its income in the greenbacks from maritime sector failed to cover the expenses.
Statistics from the brokerage Bao Viet show the maritime firm was also under pressure of high interest expenses, which come from a total debt of VND2.3 trillion ($115 million) at the end of last year.
The debt, which amounts to 70 percent of the company’s total asset, will weight down the profit even more this year due to the government’s tight monetary policy, brokers noticed.
Vietnam’s consumer price index rose 13.9 percent in March from a year earlier, according to the General Statistics Office. The office will release the data for April in the next few days, said General Director Do Thuc.
He warned that inflation in April would be even higher than in previous months.
Experts said that with year-to-date inflation already reaching 6 percent, a surge of only 1 percent in April's consumer price index would break the annual inflation target.
Vietnam plans to keep inflation at 7 percent this year. The government in February launched a series of measures to control inflation and restore macroeconomic stability, which includes tightening credit growth and supervision over the gold and currency markets.
Healthy income from ship sales
Vitranschart last year earned a net profit of VND94 billion from a revenue of VND1.93 trillion ($96.5 million). The profit was 9 percent higher than the targeted amount.
In the first six months of last year, the maritime firm’s revenue rose 71 percent year-on-year to VND936 billion thanks to the year-on-year increase of 30-60 percent in maritime costs and two new ships – VTC Tiger and VTC Glory.
Experts said the sales of two ships including Far East and Phuong Dong 2 were the main factor that helped Vitranschart to gain the positive financial results last year. The company earned profits of VND25.7 billion and $2.8 million from the sales of Far East and Phuong Dong 2 respectively.
Analysts said the income from maritime service of Vitranschart still can cover expenses this year in spite of this year’s difficulties including the increasing gasoline price and the fluctuation in maritime cost. The firm expected to earn a pretax profit of VND85-100 billion from a revenue of VND2.1 trillion this year.