On January 30, 2023, Vicostone Joint Stock Company (stock code: VCS) – a unit of Phenikaa Group, announced the estimated consolidated business results for the fourth quarter of 2022, to which the net revenue and pre-tax profit reached VND 1,227.06 billion and VND 258.47 billion, respectively. In total, Vicostone’s net revenue and profit before tax had reached VND 5,660.27 billion and VND 1,377.22 billion in the year 2022.
Political instability, inflation, tight monetary policy around the world named among the factors influencing Vicostone’s business
VICOSTONE® products have marked its presence across 50 countries with more than 10,000 agencies and partners, such a worldwide scope resulted in its 2022 business activities being prone to global macro factors. Some of the key impacts on Vicostone’s revenue to be addressed as follow:
- 2022 was the year of unpredictability, both in the world economy and in Vietnam. Adding to the aftermath of a post COVID-19 economy was the conflict between Russia and Ukraine, leading to a further exacerbation on inflation rate and thus, triggering tightened monetary policy on several of Vicostone’s major markets such as North America and Europe. In the US, as an effort to subdue inflation, the Federal Reserve (Fed) raised interest rates 07 times in 2022, causing the reference interest rate to reach its peak since 2007. Drop in retail sales, decline in housing market and burden of high interest rate painted a shadow on the world No.1 economy. The same situation occurred in Europe, as in July 2022, central banks raised interest rates for the the first time in 11 years and continued in September, October and December, thrusting the real estate industry into a stagnation state. As housing construction/repair projects experienced a sharp drop in demand, Vicostone’s export also encountered subsequent difficulties.
- High inflation rates also result in households having to pay more for essential goods and services. Besides, as the central banks in Vicostone’s main market continuously raised interest rates in the third and fourth quarters, it limited the demand for building and repairing houses, considering that people were facing a much higher-cost capital.
- Fierce competition in the industry is also a factor affecting Vicostone’s growth in the past year. According to a report by Freedonia company (US,), the global engineered stone market demand for countertops will grow at an average CAGR of 4.8% in the period of 2019 – 2024 to reach 75.2 million m2 in 2024. But in fact, the supply of engineered stone products is rising beyond the growth of demand, resulting in intense price competition among quartz manufacturers to gain market share.
Vicostone responds to the unpredictability
In such a challenging context, Vicostone continues to enhance its internal strength and proactive approach to saving costs, holding the ground on key markets and reaching for other potential markets through the development of direct distribution channels; support agents/partners in installing showrooms and warehouses, thereby amplify VICOSTONE® brand recognition and supporting sales.
Phenikaa Group’s strategy on localization of raw materials for quartz production continues to prove its efficiency in stabilizing production and minimizing dependence on imported raw materials, leading to a stable selling prices, sharpening the competitive edge. Vicostone is currently the only quartz manufacturer in the world that owns the production of its main raw materials (quartz aggregate and resin).
With a leading in science and technology application, and strong investment in R&D, in 2022, Vicostone introduced 05 collections including 26 unique product lines in domestic and international markets. Continuous improvement and innovation, steering trends and markets are among the important factors that helps VICOSTONE® forming an ever-increasing attraction, wining the heart of customers around the world.
Besides, Vicostone continues to promote the human value of “conscious business culture”, not only ensuring jobs and stable income for employees, but also actively participates in several community-support activities, contributing to social security.
The year 2023 is forecasted to be a particularly challenging year for both the domestic and international economies as signs of recession have become increasingly evident. Vicostone remains in its most determination state, proactively adapts to both difficulties and opportunities in this unpredictable context, and striving to complete the set goals.