Closing date for delisting HNG shares of Hoang Anh Gia Lai Agricultural Joint Stock Company (HAGL Agrico)

HNG shares will be delisted on September 6.

In the announcement, HoSE said the number of HNG shares that will be delisted is more than 1.1 billion shares, with a par value of more than VND11,085 billion .

The reason for delisting HNG shares is because HAGL Agrico has been making losses for 3 consecutive years, based on the audited consolidated financial statements for the years 2021, 2022 and 2023, which are subject to mandatory delisting as prescribed in Point e, Clause 1, Article 120 of Decree 155 dated December 31, 2020.

At the end of July, HoSE sent a notice to the company about the delisting of shares. The delisting of HNG shares was predicted, when in 2021 the company reported a loss after tax of more than VND 1,119 billion , in 2022 a loss of more than VND 3,576 billion and in 2023 a loss of VND 1,050 billion .

On the stock market, HNG shares “plummeted” after the news of delisting. HNG’s market price decreased by more than 20% in the past week, closing on August 9 at 4,080 VND/share.

After being delisted, HNG shares will be traded on UPCoM. To be relisted on HoSE, HAGL Agrico must have profits for 2 consecutive years before it can apply for registration.

In 2024, HAGL Agrico plans to have net revenue of 694 billion VND, an increase of 14.5% compared to the actual level in 2023. The company expects a loss after tax for the whole year of 120 billion VND.

Most recently, in the second quarter of 2024, HAGL Agrico recorded a sharp drop in net revenue of 48% over the same period, down to nearly 79 billion VND. Meanwhile, the cost of goods sold skyrocketed by 76%, operating below cost of goods sold, so it was not enough to cover expenses, HAGL Agrico recorded a net loss of 323 billion VND in the second quarter of 2024. This figure is significantly higher than the loss of 135 billion VND in the second quarter of 2023. This is also the 13th consecutive quarter that HAGL Agrico has been in a loss.

In the first 6 months, HAGL Agrico's net revenue decreased by 47% compared to the same period in 2023, to 147 billion VND. Meanwhile, net loss increased to nearly 370 billion VND, compared to a loss of 247 billion VND in the first half of 2023.

Thus, HAGL Agrico has an accumulated loss of up to 8,472 billion VND, equity has decreased to below 2,387 billion VND.

At the end of June 2024, HAGL Agrico's total assets were nearly VND 15,549 billion, up 10% compared to the beginning of the year. The cost of unfinished basic construction accounted for the majority of VND 5,463 billion, mainly in the cost of developing fruit orchards, rubber trees, cattle raising projects...

HAGL Agrico's total liabilities are over VND13,162 billion, up more than 11% compared to the beginning of the year. Loans account for the majority of VND9,138 billion, of which the company borrowed the most from Truong Hai Agricultural Joint Stock Company (a member of Thaco Group) with VND6,365 billion. HAGL Agrico also borrowed VND1,123 billion from Hoang Anh Gia Lai Joint Stock Company (stock code HAG), the rest is outstanding debt from banks.

After the first half of the year, HAGL Agrico only completed 21% of its revenue plan and recorded a deep loss compared to the plan.

HAGL Agrico said that the company's business activities are gradually improving. This year, the company plans to plant 1,533 hectares of new bananas, care for and exploit 6,328 hectares of rubber; invest in barns, pastures and import 5,800 cows. Accordingly, net revenue is estimated at 694 billion VND and pre-tax loss will decrease sharply to only 120 billion VND.

In addition, HAGL Agrico has been approved to invest in a large-scale fruit tree planting and cattle raising project in Attapeu and Sekong provinces (Laos). The project covers 27,384 hectares of land, with a total investment of VND 18,090 billion, and is scheduled to be completed between 2024 and 2028. Estimated revenue in 2028 is VND 13,500 billion, with expected profit of VND 2,450 billion.

Currently, the company implements a large-scale agricultural production strategy, industrial management throughout the value chain, applying mechanization, biotechnology and digitalization according to a suitable roadmap.

“With this strategy, the company believes it will create sustainable development and profits in the following years. From there, it will gradually reduce accumulated losses on the financial statements in the shortest time,” HAGL Agrico emphasized.