- Published on Thursday, 16 February 2017 10:11
- Written by Saigoneer.
As the number of cinemas in Saigon continues to grow, CGV is dominating Vietnam's local moviegoing industry.
VnExpress reports that the South Korean chain, officially known as CJ-CGV, currently operates 38 cinemas with 247 screens nationwide. Saigon alone is home to 16 of the firm's cinemas, and CGV shows no signs of stopping: in 2016, the company tripled its net profits from the previous year, raking in VND93.4 billion, or roughly US$4 million.
These are impressive figures considering the company has only operated in Vietnam since 2011, when it bought an 80% stake in Megastar, the former reigning cinema king, for US$73.6 million, according to the news source.
CGV saw immediate dividends, clocking revenue growth rates of 45% and 27% in 2012 and 2013, respectively, while averaging VND120 billion (US$5.3 million) in annual net profit.
However 2014 and 2015 were a bit more challenging for the company, reports VnExpress, as the chain expanded aggressively, causing profits to slump down to VND31.5 billion (US$1.4 million) in 2015 thanks to heavy investment.
Last year's banner figures show that CGV is back on its feet financially, however, and the firm has also secured exclusive distribution rights from major American studios like Universal, Paramount, Disney and Warner Brothers.
Due to the cinema chain's sheer scale, it's also currently the top distributor of local movies. However, the relationship between the Korean company and Vietnamese film industry is rather complicated: CGV has been accused of malpractice against local producers over the last year.
The most recent, high-profile allegation happened in 2016, when Tam Cam: The Untold's production company alleged CGV had treated them unfairly with regards to profit ratios and screening times. The local blockbuster ended up being removed from all CGV cineplexes nationwide, but went on to rake in VND66 billion (US$2.9 million) in total revenue anyway.
[Photo via Cosmo Life]