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TLC: Explanation for operating results in Quarter II/2008
Thang Long Telecommunications JSC explained the operating results as follows
In Quarter II/ 2008, the Company suffered a loss because of the following reasons:
- The products of the Company are mainly purchased by the Postal and Communication industry but the planned target relating to copper cables of this industry has been cut down suddenly.
- As planned, the Company had to sign long-term contracts and import materials several months before manufacturing. However, the imported materials’ price increased by 10%-20% and finished products were hard to sell when demand was much less than supply.
- In 2008, there are 10 new comers in telecommunication cable industry with aim of capturing bigger market share. As a result, the Company had to reduce unit prices.
- Depreciation of US dollar.
- Increase in staff salary has caused bigger expenses.
- Expenses for transportation increased because of higher petrol price.
- Most of the Company’s customers are local post offices with limited budget for contract settlement, which has caused great damages to the Company.
HaSTC
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