Hoa Binh Construction talks about plans to remove its shares from the control list.

Effective January 19, 2024, the Ho Chi Minh City Stock Exchange decided to move HBC shares from the restricted trading category to the controlled category. HBC is being monitored due to the company's failure to submit its audited financial statements for 2021 and 2022 on time. Additionally, the stock was placed under warning status from July 13, 2023, because the retained earnings in the consolidated audited financial statements for 2022 were negative.

The company stated that it has been working closely with its auditing firm to complete and publish the audited financial statements for 2023 on schedule, by March 30, 2024. In addition, the company published its separate and consolidated financial statements for the second quarter of 2024 ahead of schedule. The group is also striving to complete and publish its reviewed separate and consolidated semi-annual financial statements for 2024 on time.

Explaining the resolution of the stock warning, Hoa Binh Construction stated that it has been implementing a comprehensive restructuring to improve production and business efficiency, overcoming the crisis in an economic situation affected by many unfavorable events domestically and internationally.

Specifically, the company issued debt-to-equity swap shares totaling 73.08 million shares, thereby increasing its charter capital by 730 billion VND. The company is aiming to expand its market into industrial construction, infrastructure, social housing, and develop overseas markets.

Regarding infrastructure construction, the company stated that it will participate in potential projects and increase the proportion of revenue in this segment, as the 2024-2025 period is the peak time for disbursing public investment. For industrial construction, the company said it will continue to implement its strategy of developing value in the processing and manufacturing industrial market, following the wave of investment shifting to Vietnam.

Civil engineering was previously a key area of ​​focus, but due to the frozen and challenging real estate market, the company is now looking to seek reputable clients with strong financial capabilities. The company also aims to expand its construction services globally , collaborating on projects related to construction, building materials, and design.

In addition, Hoa Binh's leadership stated that they will mobilize human resources to recover outstanding debts, employing various solutions such as resolving debt disputes through economic courts or international arbitration.

"We are confident that we will succeed in the comprehensive restructuring strategy we have outlined," wrote Mr. Le Viet Hai, Chairman of the Board of Directors of Hoa Binh Construction, in a document sent to the Ho Chi Minh City Stock Exchange.

In the second quarter of 2024, Hoa Binh Construction recorded revenue of VND 2,160 billion, a decrease of 4.8% compared to the same period last year. Net profit after tax reached VND 684 billion, while the same period last year saw a loss of VND 268 billion, an increase of VND 952 billion. Gross profit decreased by 74.4% compared to the same period last year, equivalent to a decrease of VND 290 billion to approximately VND 100 billion.

Hoa Binh Construction's gross profit in the second quarter was insufficient to cover financial and selling expenses. A bright spot during this period came from the reversal of a provision of over 220 billion VND for administrative expenses, compared to 528 billion VND in the same period last year. As a result, the company reported a net profit of 684 billion VND, a significant improvement compared to a loss of over 268 billion VND in the same period of 2023.

For the first half of 2024, Hoa Binh Construction recorded revenue of VND 3,811 billion, an increase of 10.1% compared to the same period last year. After-tax profit reached approximately VND 741 billion, an improvement compared to the loss of VND 713 billion in the same period.

In 2024, Hoa Binh Construction Group planned for total revenue of VND 10,800 billion, a 43.3% increase compared to the same period last year, with projected after-tax profit of VND 433 billion, compared to a loss of VND 1,110.7 billion in the same period last year. In the first half of the year, the group had already achieved 35.3% of its revenue target and 171% of its profit target.

On the stock exchange, HBC shares are currently trading at around 5,320 VND, the lowest level in the past four years. The trading volume of this stock in the last 10 sessions has exceeded 712,000 units. Market capitalization is approximately 1,847 billion VND.