PSH stock is put on warning list

The audit report had up to 3 exceptions, causing the shares of Nam Song Hau Petroleum Investment and Trading Joint Stock Company (PSH) to be put on warning status by the Ho Chi Minh City Stock Exchange (HoSE) from April 10.

The Ho Chi Minh City Stock Exchange (HoSE) has recently decided to put PSH shares of Nam Song Hau Petroleum Investment and Trading Joint Stock Company on the warning list from April 10. According to HoSE, the reason is because the auditing organization has an exception opinion on Nam Song Hau's 2023 audited financial statements.

The information being put on the warning list caused PSH shares to be under intense selling pressure in the last session of last week and the beginning of this week. Specifically, PSH is experiencing a series of 3 consecutive sessions of decline, including 2 sessions losing all amplitude. In the morning session of April 8, the market price of this stock decreased by 7% to 6,600 VND and is in a state of no buyers. The matched volume in the hour after opening was more than 1 million shares. Compared to the price range of 10,300 VND at the beginning of the year, the current market price of PSH has decreased by 36%.

Regarding the audited financial statements, TTP Auditing Company Limited has issued 3 unqualified opinions for Nam Song Hau.

The first exception relates to the decision by the Hau Giang Provincial Tax Department to enforce tax collection by suspending the use of invoices from December 18, 2023 to December 17, 2024 for VND 1,139 billion and the decision by the Can Tho City Tax Department to suspend the use of invoices from December 22, 2023 to December 23, 2024 for VND 92.5 billion. The total revenue in the year without issuing invoices is VND 236.8 billion.

According to the explanation of Nam Song Hau's management board, in December 2023, due to financial difficulties, the company liquidated a number of investment properties in Soc Trang, Dong Thap, and Tra Vinh provinces. However, due to the tax authority's enforcement of an administrative decision on tax management by suspending the use of invoices, the company temporarily recorded revenue from real estate transfers without issuing invoices. "In the coming time, after the company completes its tax obligations to the state, the company will issue valid invoices for the above revenue," said Nam Song Hau's management board.

In the financial report, the auditor also gave an exception opinion that the outstanding payments to the state budget and overdue debts showed the existence of material uncertainties leading to significant doubts about the company's ability to continue operating. However, Nam Song Hau's management affirmed that the company had a plan to overcome financial difficulties. Specifically, on February 27, the company signed a loan approval contract with its partner, the financial institution Acuity Funding. According to the plan, Acuity Funding will disburse 290 million USD in the second quarter of 2024 to the company.

“With Acuity Funding’s 20-year long-term credit financing, it will greatly support the company in restructuring the payment of tax debts, overdue debts, and outstanding bond debts to reduce financial pressure to help the company overcome difficulties and grow stably and sustainably,” said Nam Song Hau’s leadership.

Regarding the exception regarding the inability of the auditor to determine the existence of inventory value, the management board stated that the Company's inventory worth VND 4,654 billion is currently stored in many different warehouses and all have full purchase and warehouse receipts. Because the company is in the process of transferring between old and new personnel, it has not been possible to arrange suitable time and personnel to serve the work of verifying and checking inventory.

Nam Song Hau operates mainly in the fields of import and export and trading of petroleum, petrochemical refining, and liquefied petroleum gas. The company was established in Hau Giang in early 2012 and listed on the stock exchange in mid-2020. The company currently has a charter capital of more than VND 1,261 billion, of which Mr. Mai Van Huy (Chairman of the Board of Directors) holds 62.53% of the capital. This is one of the largest new petroleum enterprises in the Mekong Delta with a system of more than 52 branches.

In 2023, Nam Song Hau recorded revenue of VND 6,099 billion, down 17% compared to 2022. After deducting expenses, the company had a net profit of VND 51 billion while in the same period, it lost up to VND 236 billion.

Source