Garmex Sai Gon Joint Stock Company (GMC) reported a revenue of nearly 553 million VND in its second quarter financial report, 2.5 times higher than the same period last year. However, the company also reported a ninefold increase in losses, exceeding 4.4 billion VND. This is due to decreased financial revenue and income from asset liquidation, coupled with increased cost of goods sold. This marks GMC’s fifth consecutive quarter of losses.

For the first 6 months of the year, Garmex Sai Gon's total revenue was over 898 million VND. While this represents a 2.5-fold improvement compared to the same period last year, it translates to less than 5 million VND in daily revenue. During this period, GMC's revenue didn't primarily come from its core garment business, but mainly from business cooperation (pickleball court rentals) and pharmacy operations.

Overall, the company's after-tax loss exceeded 12 billion VND, compared to a profit of over 755 million VND during the same period last year. Management attributed the loss to reduced financial revenue due to lower interest rates, decreased income from asset liquidation due to unsuccessful attempts to sell unused assets, and increased cost of goods sold from the newly established pharmacy business. GMC's accumulated losses as of June have reached nearly 116 billion VND.

Established in 1976, Garmex Sai Gon was once a renowned garment enterprise with trillions of VND in revenue between 2012 and 2021. At its peak, the company owned five factories in Ho Chi Minh City, Ba Ria - Vung Tau, and Quang Nam, with over 70 production lines.

However, in late 2022, a major partner, Binh Thanh Export Production and Trading Joint Stock Company (Gilimex), experienced a sharp production cut by Amazon Robotics LLC after significant investments in infrastructure and inventory. This drastically impacted Garmex Sai Gon’s business. Finished goods inventory currently stands at nearly 86 billion VND, with nearly 15 billion VND set aside for impairment losses.

Due to a lack of orders, Garmex Sai Gon halted production in 5/2023 and laid off thousands of workers. At its peak, the company employed around 4,000 people, but by the end of June, only 29 employees remained.

Workers at the Garmex Tan My factory (Ba Ria - Vung Tau). Photo: GMC

Workers at the Garmex Tan My factory (Ba Ria - Vung Tau). Photo: GMC

In addition to layoffs, the company has been liquidating machinery and real estate, and operating a pharmacy at its headquarters to mitigate financial difficulties. Earlier this year, GMC signed a contract leasing up to 3,000 m² of land to VinaPrint Joint Stock Company for pickleball courts and other sports facilities. The one-year contract is worth 1.8 billion VND, providing Garmex Sai Gon with stable monthly income regardless of business performance.

Having ceased production for over a year, Garmex Sai Gon was delisted from the Ho Chi Minh City Stock Exchange (HoSE) late last year. GMC subsequently moved to UPCoM but was placed under trading restrictions, allowing trading only on Fridays. From its peak of over 28,000 VND in 2021, the stock now trades below 5,000 VND.

Tat Dat