DIC Corp (DIG) suffered a record loss of 121 billion in the first quarter, dissolved a subsidiary with a capital of 300 billion.

DIC Corp (DIG) dissolved its subsidiary with a capital of 300 billion VND after 1 year of establishment.

Construction Development Investment Corporation - DIC Corp (HoSE Code: DIG) has just announced the dissolution of Vung Tau Centre Point LLC. This is a subsidiary that was established less than a year ago in the DIC Corp ecosystem with a charter capital of up to 300 billion VND.

Vung Tau Centre Point was established in June 2023 with the company address located at 12 3/2 Street, Ward 8, Vung Tau City, Ba Ria - Vung Tau Province, with a charter capital of 300 billion VND. The company is registered to operate mainly in the field of real estate business, land use rights owned, used or leased.

DIC Corp (DIG) has just dissolved its subsidiary with a capital of 300 billion VND after a record loss of 121 billion VND (Photo TL)

In addition, some of Vung Tau Centre Point's sideline business activities include housing construction, civil construction, club activities, sports and entertainment education, hairdressing, cosmetics and beauty products trading... The company's legal representative is Mr. Le Dinh Thang, who is also the Chairman of the Board of Directors of DIC Holdings Construction Joint Stock Company - DICons (Code DC4).

Previously, DIC Corp's leaders shared that Vung Tau Centre Point was established to account for the project transfer, which had been carried out by DIG since 2019 but the form of recording the transfer had not been determined. Therefore, DIG established a new company and then transferred DIG's capital contribution here.

Specifically, the project is recorded as land A2 Chi Linh, DIG cooperated with DC4 to establish Vung Tau Centre Point company to develop the land. Part of the capital is held by DC4.

After dissolving Vung Tau Centre Point, DIC Corp has 9 subsidiaries and 5 associated companies left.

Heavy loss of 121 billion VND in the first quarter

The dissolution of DIC Corp's subsidiary comes as the company has been suffering heavy losses since the beginning of 2024.

In the first quarter of 2024 alone, DIC Corp had to return up to 186 billion VND worth of goods sold, causing recorded revenue to drop to only 489 million VND. As a result, DIG had a net loss from business operations of 117.4 billion VND.

Financial revenue also dropped dramatically by 93% compared to the same period, to only 12 billion VND. The reason is that there is no longer a sudden income of 162 billion VND from investments like the same period last year.

In addition, despite the sharp decline in revenue, DIC Corp still had to bear additional sales and administrative expenses, which increased by 38% and 72%, respectively. These two expenses currently account for VND12.8 billion and VND53.4 billion.

After deducting operating expenses, DIG lost 121.2 billion VND after tax in the first quarter of 2024.

Bond debt increased by trillions after a few months

At the end of the first quarter of 2024, DIG's total assets reached VND 17,765 billion, an increase of about 6% compared to the beginning of the year. Of which, cash and cash equivalents accounted for VND 1,942 billion. In addition, there were VND 1,021 billion in deposits held to maturity on the financial statements.

The value of inventories in the period also increased by 4%, accounting for more than VND 6,784 billion. In addition, long-term receivables from customers are still relatively large, accounting for VND 1,381 billion.

In DIC Corp's capital structure, total liabilities currently account for VND9,993 billion. Most of which is short-term debt, accounting for VND7,490 billion. The company is currently borrowing VND1,932 billion in short-term debt, a decrease of nearly VND200 billion compared to the beginning of the year.

Notably, long-term debt is tending to more than double, from VND 961 billion to VND 2,307 billion. In the accounting section on outstanding bonds for a large bank, DIC Corp recorded an increase in bond debt from VND 250 billion at the beginning of the year to VND 1,550 billion at the end of the first quarter of 2024. This shows the trend of increasing long-term debt of DIC Corp through bond issuance.

Source: https://www.congluan.vn/dic-corp-dig-lo-ky-luc-121-ty-dong-ngay-quy-1-2024-giai-the-cong-ty-con-von-300-ty-dong-post299252.html