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The impact of covid-19 on CJ CGV revenue in Vietnam

Name: Nguyễn Ánh Ngọc
Major in busisness administration

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Table of Contents
1.

Introduction of CJ CGV in Vietnam..........................................................................................................3
1.1.

General introduction........................................................................................................................3

1.2 Vision......................................................................................................................................................3
1.3 Mission....................................................................................................................................................3
2.

Impact of the covid-19 pandemic on CJ CGV revenue in Vietnam.........................................................4
2.1 Revenue of CJ CGV in Vietnam before 2020..........................................................................................4
2.2 Revenue of CJ CGV when impacted by covid-19...................................................................................5
2.2.1 Overview of the covid-19 pandemic...............................................................................................5
2.2.2 Revenue of CJ CGV during the covid-19 pandemic........................................................................6

3.

Some solutions and recommendations on the impact of the covid pandemic on CJ CGV....................9

3.1 Solution...................................................................................................................................................9
3.1.1 Solutions for the company..............................................................................................................9
3.1.2 Government solution......................................................................................................................9
3.2 Request...................................................................................................................................................9

4.

Conclusion..............................................................................................................................................10

5.

References..............................................................................................................................................10

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1. Introduction of CJ CGV in Vietnam
1.1.General introduction
CJ CGV is the largest movie theater chain in Korea, and now has branches in
countries: Vietnam, USA and China. The phrase CGV is abbreviated from 3
letters that start from: Cultural, Great and Vital. Up to now, CGV has built 142
cinema complexes, including 681 screening rooms with more than 100,000
seats.
CJ CGV entered Vietnam market in 2011 with the acquisition of 92% shares
of Envoy Media Partners (EMP0). EMP at that time held 80% of shares in
Megastar Media Co., Ltd., which owned the Megastar cinema complex at that
time, the remaining 20% was under the control of Phuong Nam Cultural
Company. After the above deal, EMP became a subsidiary of CJ CGV. Although
holding a large share of Megastar, it was not until the end of 2013 that CJ
officially converted the MegaStar brand in Vietnam into CGV. Finally, on

January 15, 2014, all Megastar cinemas in Vietnam were renamed CGV and
ushered in a prosperous period of CGV cinema chain. (Thịnh, 2020)
1.2 Vision
CJ CGV has expressed its vision with a short slogan: ''Create a New Culture
For Healthy, Happy and Convenient Lifestyl'''.
CGV always aims to be the first choice for movie watching and
entertainment activities
1.3 Mission
Always do our best to bring cinema products with international standards to
all classes of audiences.
Become a model company that always actively contributes to the
development of society in general and to the Vietnamese film industry in
particular.

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2. Impact of the covid-19 pandemic on CJ CGV revenue in Vietnam
2.1 Revenue of CJ CGV in Vietnam before 2020
According to the 2017 report, CGV said that it is managing and operating
47% of cinemas in Vietnam.
The scale of the CGV theater system has increased by 5 times compared to
2011.
In early 2017, after Platinum withdrew from some shopping centers, CGV
immediately replaced.
Number of theaters and screening rooms from 2014 to 2017

As of February 2018, CGV currently has:

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According to statistics published by CJ CGV Corporation, in 2019 the CGV
cinema chain brought in more than 3,600 billion VND in the Vietnamese
market, an increase of 35% compared to 1028. This result comes from the
expansion of the system. as well as the success of popular hollywood and
domestic movie.
The monthly revenue of the CGV theater system reaches 305 billion VND
and averages more than 10 billion VND per day.
As of 2019, Vietnam's CGV system owns 82 cinemas with 475 screens, an
increase of 15% compared to 2018.
CGV's profit also increased from increasing the average ticket price by 6%,
effective cost management and increased sales activities. (khoán, 2020)
2.2 Revenue of CJ CGV when impacted by covid-19
2.2.1 Overview of the covid-19 pandemic
Acute respiratory syndrome Corona Virus (SARS-CoV-2) was first detected
in December 2019 in Wuhan city, Hubei province, China has caused a global
outbreak and is a public health problem
On October 30, 2022, WHO declared COVID-19 as the 6th public health
emergency of international concern.
The rapid spread of the Covid-19 Pandemic is unexpected, not only in
China but also around the world. The number of sick people must be counted
on a daily or even hourly basis.

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Data of Covid-19 cases as of October 29, 2020 in Vietnam and the world

2.2.2 Revenue of CJ CGV during the covid-19 pandemic

In 2020, when the Covid-19 pandemic appeared in Vietnam. The state
began to issue anti-epidemic policies, which greatly affected business
activities in Vietnam.
Especially in the entertainment industry, CGV was forced to close most of
its cinemas. That has made CGV's revenue decline year on year.
The emergence of the pandemic also caused film production businesses
to be delayed indefinitely. Domestic and foreign film studios canceled their
movie production plans and delayed the movie release schedule until the
situation stabilized, leading to a situation in which the entire cinema market
was severely short of new movie sources, especially especially blockbuster
movies to attract viewers.
At the same time, the epidemic situation makes most people afraid to go
to crowded places such as cinemas and shopping centers.
CGV Vietnam represents the face of the film industry when holding about
50% market share. In 2020, this company was severely affected, seeing
revenue decrease by 61% to nearly VND 1,400 billion. In the peak year of
2019, CGV Vietnam recorded a revenue of more than VND 3,630 billion, or
an average of more than VND 10 billion per day.
Notably, the loss of CGV Vietnam suddenly increased to more than 850
billion VND. In the previous years, the company lost more than 150 billion

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dong and 27 billion dong respectively (according to the parent company's
report). (CGV Việt Nam lỗ hơn 850 tỷ đồng năm 2020, 2021)

Chart of revenue and profit of CJ CGV Vietnam from 2018 to 2020

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The heavy loss made CGV Vietnam's equity negative about 470 billion
VND. Total assets of the film company are more than 7,800 billion VND, while
liabilities are recorded at more than 8,300 billion VND.
In the beginning of 2021, CGV Vietnam's revenue continued to decrease by
10% over the same period. However, EBITDA improved thanks to the success
of a number of Vietnamese films, including "Bố già" which hit box office
records.
The recovery was quite positive, before the 4th wave of Covid-19 arrived,
the development was complicated and prolonged. (CGV Việt Nam lỗ hơn 850
tỷ đồng năm 2020, 2021)
3. Some solutions and recommendations on the impact of the covid
pandemic on CJ CGV
3.1 Solution
3.1.1 Solutions for the company
The film company makes recommendations to the Government and
Ministries:
There are support policies to restructure loans, or grant new
preferential credit packages.
There are support policies to restructure loans, or grant new
preferential credit packages.
Reduce 50% of the value added tax collected by film enterprises and
postpone the payment of this tax until the end of the year, exempt and
reduce personal income tax for employees of film enterprises.
Having policies to mobilize and support real estate businesses to
create favorable conditions for businesses to rent premises to exempt rent
and service fees for cinema units during the period of closure due to the
epidemic. and at least 6 months since the theater reopened…
3.1.2 Government solution

The Government has implemented measures to ensure social security,
mobilized and mobilized the strength of national unity and social resources
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of domestic and foreign organizations and individuals. for COVID-19
prevention and control activities
To reopen entertainment activities when the epidemic is under control and
most people have been vaccinated against covid 19
3.2 Request
The government should have policies to encourage and promote cinema
companies, typically CGV.
Strong measures should be taken against websites that use noncopyrighted movies and movies stolen from theaters. To motivate people to
go to the cinema to experience the movie.
4. Conclusion
The major cinema chains in the market today can be mentioned:
Platinum Cineplex, BHD Star, Galaxy Cinema, Lotte Cinema and CGV giants
with 45% of the movie theater market in Vietnam, that helps CGV overwhelm
other cinemas. other competitors and bring huge revenue to the business.
That is why, when affected by the Covid pandemic, CGV is also a company
that is greatly affected.
The above research article has raised the situation of CGV before and
during the covid-19 pandemic. From there, the impact of the covid 19
pandemic on CJ CGV can be drawn.
5. References
Thịnh, V., 2020. Công ty CJ CGV Việt Nam- Cụm rạp chiếu phim CGV
Micpectower. 1st ed. Hà nội: Đại Học Kinh Tế Quốc Dân.
Việt Hà, T., 2018. Chiến lược kinh doanh của CJ CGV Việt Nam. 1st ed. Hà
Nội: Học Viện Ngân Hàng.
NĐH. 2022. CGV Việt Nam lỗ hơn 850 tỷ đồng năm 2020. [online] Available

at: < [Accessed 26 May 2022].

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tin tức khoahocdoisong.vn. 2022. CGV lỗ hơn 2 tỷ mỗi ngày trước khi kêu
cứu Thủ tướng. [online] Available at: < [Accessed 27
May 2022].
VietnamPlus. 2022. COVID-19: Doanh nghiệp chiếu phim 'khóc rịng' vì
tương lai mịt mù | Điện ảnh | Vietnam+ (VietnamPlus). [online] Available
at: < [Accessed 26 May 2022].
khoán, K., 2020. CGV Việt Nam lợi nhuận 156% trong năm 2019. [online]
Kinh tế chứng khoán. Available at: < [Accessed 31 May 2022].

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