Coteccons reports record high profits after being asked to open bankruptcy proceedings

Coteccons Construction Joint Stock Company (CTD) has just announced its financial report for the second quarter of 2023. Coteccons' second quarter revenue increased by 10% over the same period last year to nearly VND 3,619 billion, even though the construction industry and businesses in the industry are still facing many difficulties. The real estate market is sluggish, with few new projects starting and slow public investment disbursement.

Profit after tax in the second quarter of 2023 reached more than 30 billion VND, the highest since the third quarter of 2021, while in the same period last year, it lost nearly 24 billion VND.

Accumulated for 6 months, Coteccons, chaired by Mr. Bolat Duisenov, earned a profit of more than 52 billion VND, nearly 10 times higher than the same period.

Coteccons and construction enterprises are waiting for the bidding results of the largest package of the Long Thanh Airport project worth 35,000 billion VND.

This enterprise is also involved in the case of Ricons filing a petition to the court, requesting to open bankruptcy proceedings because of an overdue debt that has not been paid for many years.

Coteccons and Ricons are in two different consortia, out of a total of three consortia participating in the bidding for package 5.10 worth VND35,000 billion of Vietnam Airports Corporation (ACV) to build Long Thanh Airport project.

The three consortiums participating in the package include: CHEC-BCEG-Vietnam Contractors, Hoa Lu Consortium and VIETUR Consortium. Hoa Lu Consortium is led by Vietnamese contractor Coteccons. Information about the winning unit of package 5.10 has not been announced.

*Coteccons is chaired by Mr. Bolat Duisenov. (Photo: DT)*

A notable point in the Q2/2023 report is that Coteccons no longer records debt to Ricons. Previously, at the end of Q1/2023, Coteccons recorded a debt of VND322.5 billion to Ricons.

In the request to open bankruptcy proceedings against Coteccons, Ricons said that it had sent many official dispatches proposing solutions from Coteccons but had not received any goodwill responses.

On July 24, Coteccons said it had received a notice from the Ho Chi Minh City People's Court regarding Ricons' request to open bankruptcy proceedings.

Afterwards, Coteccons spoke up that there was debt with Ricons but it was before 2019. At that time, Coteccons and Ricons were managed and identified as contributing components to an ecosystem of 7 interconnected member companies, including Coteccons, Unicons, Ricons, Newtecons, BM Windows, Sol E&C, Boho.

Another member of Hoa Lu Joint Venture, Hoa Binh Construction (HBC), chaired by Mr. Le Viet Hai, has just announced its consolidated financial report for the second quarter of 2023 with positive figures.

Accordingly, after-tax profit in the second quarter of 2023 increased more than 12 times from nearly VND 45.2 billion in the same period to more than VND 546.3 billion, even though this enterprise had just gone through a civil war that lasted from the beginning of the year until almost the end of June.

The reason Mr. Le Viet Hai's business has positive profits is thanks to restructuring activities, selling assets to restructure debt to improve the financial situation and thereby be able to participate in construction projects.

Coteccons reacts when its competitor requests to open bankruptcy proceedings at a sensitive time . Coteccons Construction spoke out about its competitor Ricons requesting to open bankruptcy proceedings at a time when it was "in the process of bidding for very important projects".

Source