NOBASHI
NOBASHI VANNAMEI
RAW
HO CENTRAL PEELED BT
COOKED
COOKED PDTO VANNAMEI
PRE-FRIED SHRIMP
FRITTER VANNAMEI
VEGETABLES
GINGER
VEGETABLES
BÍ NHẬT
NOBASHI
NOBASHI VANNAMEI

OVERVIEW OF OPERATION IN THE FIRST HALF OF THE YEAR 2008 OF FMC

1)                  Starting with many disadvantages:

In the 2007 Annual Meeting of Shareholders, shareholders questioned why FMC’s stock products were higher than those of past years.

That was the common situation of shrimp processing factories in CuuLong river delta while volumn of vannamei shrimp suddendly transgressed that of black tiger shrimp strongly (so The Agriculture and Rural Development Ministry has permitted to culture vannamei shrimps in western areas from end of 2007). Normally, shrimp price goes up in off-season but this year shrimp price in global market goes down gradually from January to June. All input costs (except raw material price) increase due to inflation, output price decreases due to selling price and exchange rate which is to limit inflation by the government (in March and April). All plans are broken, the company mainly resists to wait an opportunity.

2)                  Overcoming:

Production output in the first 6 months is 2,554 tons equal to 99 % from same period of 2007. Export output is 2.470 tons equal to 97,6 % from same period of last year. The Company can only contend as such because turnover just reach VND 347 billion equal to 82  %  from same period of 2007, the reason is due to decreased shrimp price and big quantity of smaller size shrimps. Above disadvantages plus lower price adjustment of stock at end of June that make AVAILABLE but not high profit (detailed data will be announced after completing finance finalization). The result is not same as expected but that is the Company’s great effort. FMC had to procure raw material from many other areas from Nghe An, Ninh Thuan backwards; had to constantly develop cost saving; and had to be more enthusiastic in searching customers … Administration Board expects to temporarily suspend the project of fish factory because the output of this item is facing difficuties and bank interest increasing severely….. to focus the Company’s force to Vegetable processing factory.

3)                  Faith in the future :

Though consumption price in global market hasn’t improved (this brings the  most disadvantages to shrimp farmers and if the situation lasts for a long time it will cause difficulties to processing factories due to lacking raw material), with goods adjusted in price appropriately, shrimp harvest season nearly starts, market is about to start its consumption (Om Bon in August in Japan, Christmas all over the world…), agricutural products are being cultivated massively with purchase contracts concluded and vegetable processing factory will be completed within this year, simultaneously USD exchange rate is on ADVANTAGEOUS direction for exporters… which are good things for the last 6 months and later years of FMC.

                                                                                                                                                                                                                                                             Ho Quoc Luc

                                                                                                                                                                                                                                                             The Chairman .