After 10 years investing in Vietnam, Lotte Group has opened 13 supermarkets despite continuous losses.
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Lotte's financial report shows that its subsidiary Lotte Vietnam Shopping has been continuously losing money for many years. The company owns and operates the Lotte Mart supermarket chain in Vietnam.
Accordingly, in 2016, the company lost 13 billion won (about 259 billion dong). Previously, the loss was even greater in 2015, about 26 billion won (equivalent to 507 billion dong).
It is estimated that total loss of this company in Vietnam market since 2010 has reached more than 1,600 billion dong.
Despite continuous losses, the company has been launching new supermarkets in recent years.
From the first supermarket in Ho Chi Minh City in 2008, there are now 13 supermarkets opened across Vietnam. In particular, in 2014, this retailer opened four supermarkets. After that, 3 more Lotte Mart were opened in 2015 and 2016.
The sales of this retail system have grown so well. Over the past three years, Lotte Mart has increased its revenue by one trillion dong each year. However, profits are still negative numbers.
By the end of 2016, the total value of the retailer's assets was 9,125 billion but 95% of which was liability. The owner's equity is only about 500 billion dong.
Not only investing in supermarkets, this Korean corporation also take part in other fields including e-commerce, fastfood and cinema.
In real estate, Lotte owns many hotels in Hanoi and Ho Chi Minh City and operates Lotte Shopping Plaza, a trading center in Hanoi.
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