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Home / Economy / Trade - Service
Mobifone remains cautious over business plan in 2018
Nguyen Tung 17:19, 2018/04/10
Mobifone set revenue growth target in 2018 at 6%, significant lower than the rate of 14% in 2017, according to the company`s audited financial report in 2017.
The telco's revenue in 2017 reached VND40 trillion (US$1.76 billion), up 14% year on year. However, due to the increase in expenses, Mobifone's accumulated profit was at the same of 2016, reaching VND12 trillion (US$529.2 million).
 
​Mobifone remains cautious over business plan in 2018.
​Mobifone remains cautious over business plan in 2018.
With regard to the firm's expenditures, Mobifone posted its sales expenses at VND5.3 trillion (US$233.7 million), down 8.6% over the last year's figure. Concurrently, the administrative expenses are recorded at VND1.26 trillion (US$55.5 million), a slight increase of 1%, while its financial expenses are insignificant of VND55 billion (US$2.4 million).

By the end of 2017, Mobifone's pre-tax profit is recorded at VND5.6 trillion (US$247 million), increasing 8% compared to previous year. As at December 31, 2017, the telco's total assets worth VND30 trillion (US$1.32 billion), up 20% compared to the year beginning. 

The majority of the assets lies on the fixed ones at VND13.6 trillion (US$599.7 million), long-term investment of VND9.4 trillion (US$414.5 million, including the investment in multimedia company Audio Visual Global - AVG of VND8.9 trillion, or US$392.5 million), and bank deposits of VND3.2 trillion (US$141.1 million). 

In 2018, Mobifone set revenue target of VND42.3 trillion (US$1.86 billion), up 5.9% compared to that of in 2017, while its pre-tax profit is estimated at VND6.1 trillion (US$269 million), up 8.2%. 

The modest target, according to Mobifone, is due to slowdown in the growth rate of the telecommunication market in Vietnam, which is maintained at 3 - 5%. Additionally, the retail market for telecommunication devices and equipment is expected to be under fierce competition from domestic and foreign investors.

The telco also planned to invest an additional 3,000 3G stations and 7,500 4G stations. In 2017, Mobifone has disbursed VND7.6 trillion (US$335.1 million) of investment capital, through the launch of 5,000 3G stations and 4,000 4G stations. 

Released on March 14, the Government Inspectorate's inspection result found that Mobifone was irresponsible and violated a series of regulations during the acquisition of AVG. Following the results, GI recommended the Ministry of Public Security to take over the investigation and prosecute violators in accordance with the law. 

The deal caused great controversy as its value was 2.58 times higher than AVG's charter capital of VND3.6 trillion (US$158 million) at the time of completing the transaction on January 2, 2016. The investment in AVG was equivalent to 55% of Mobifone's charter capital (VND16.2 trillion or US$711 million) and 40% of its total assets (VND23.2 trillion or US$1.02 billion) as of June 30, 2016. 

At present, Mobifone and related government agencies are responsible to implement recommendations suggested in the inspection result. 
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