The investor of many CII highways earned nearly 170 billion VND in profit in the fourth quarter of 2023, 4 times higher than the same period last year thanks to the consolidation of the Trung Luong - My Thuan project.
A newly released financial report shows that Ho Chi Minh City Infrastructure Investment Joint Stock Company (CII) had revenue of nearly VND733 billion, down 60% compared to the fourth quarter of 2022. The decrease mainly came from the real estate business segment, down 27 times compared to the same period.
Meanwhile, the traffic toll collection segment grew by 63% to over VND592 billion, accounting for over 80% of total revenue. At the end of October 2023, Trung Luong - My Thuan BOT Joint Stock Company - the operator of the project of the same name, became a subsidiary of CII, helping to consolidate the business results of this project.
Thanks to a sharper decrease in cost of goods sold, gross profit this period was higher than in the fourth quarter of 2022. In addition, CII recorded a 2.5-fold increase in financial revenue, mostly from the transfer of financial investments.
Excluding expenses, CII earned a profit of VND 167 billion after tax, up 3.8 times over the same period in 2022. This is the highest profit in the last 7 quarters.
However, the company's cumulative business results for the year decreased sharply compared to the same period last year. Revenue decreased by 47% to more than VND3,055 billion, and after-tax profit decreased by 56% to about VND380 billion. The company only completed nearly 60% of the revenue target and 40% of the profit plan for the year.
The failure to complete the business plan was predicted by the board of directors. In an extraordinary meeting in mid-October 2023, Mr. Le Quoc Binh - General Director of CII, said that the business results for the whole year would not meet the set plan. The main reason was the inability to increase the toll collection at BOT projects as planned and legal problems at real estate projects that have not been resolved.
CII owns a portfolio of large BOT projects in the Southern region, including Trung Luong - My Thuan Expressway, Hanoi Highway expansion, National Highway 60 and Co Chien Bridge expansion, Binh Duong Provincial Road DT741, Phan Rang - Thap Cham City bypass expansion and National Highway 1 through Ninh Thuan.
The toll collection segment brought in nearly VND1,700 billion in revenue last year, equivalent to VND4.6 billion per day. Of which, the Trung Luong - My Thuan BOT project accounted for nearly half. Recently, two toll stations, Ca Na on National Highway 1 (Ninh Thuan) and Co Chien Bridge (Tra Vinh), were approved to increase ticket prices by 18%.
Cai Lay toll station on Trung Luong - My Thuan expressway. Photo: Phuong Linh
Recently, this enterprise has been focusing on financial restructuring when the leverage ratio has been at a high level for many years. By the end of 2023, CII's total liabilities will be more than VND 24,700 billion, an increase of 22% mainly due to long-term loans from banks to invest in projects. Total debt is 2.9 times higher than equity.
To restructure its finances, CII chose to issue a total of VND7,000 billion in convertible bonds to shift from relying on external debt to equity from shareholders. From there, the proceeds from BOT projects will be used to pay dividends and bonds to shareholders and bondholders, instead of paying them to banks as before. In the first issuance, which was completed last weekend, the company sold more than 99% of the total bonds offered and raised more than VND2,800 billion.
At the same time, the company began paying a regular dividend of 16% per year. Earlier this year, they spent VND100 billion to pay cash dividends to shareholders at a rate of 4%, meaning each share would receive VND400. This is CII's first cash dividend after more than 3 years the company prioritized using the money to pay off bank loans.
Siddhartha
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