HAGL Agrico reported a loss for the 14th consecutive quarter, short-term debt increased by more than 2,000 billion VND

With a post-tax loss of VND546 billion after 9 months of 2024, HAGL Agrico (code: HNG) has increased its accumulated loss to VND8,648 billion. This loss has also far exceeded the target of only VND120 billion in pre-tax loss in 2024 approved by the General Meeting of Shareholders.

HAGL Agrico (HNG) lost another 182 billion VND in the third quarter of 2024

Hoang Anh Gia Lai International Agriculture Joint Stock Company (HAGL Agrico, code HNG - UPCoM) has just announced its financial statements for the third quarter of 2024 with net revenue reaching VND 141 billion, down 12% over the same period last year. Due to operating below cost price (VND 187 billion), HNG suffered a gross loss of VND 47 billion, but this was significantly reduced compared to the gross loss of VND 101 billion in the same period in 2023.

In terms of expenses, except for financial expenses, which increased by 34% to VND117 billion this period, sales expenses and administrative expenses decreased by 58% and 72% to VND2.7 billion and VND5 billion, respectively. As a result, HNG reported a loss after tax of VND182 billion in the third quarter of 2024, a slight decrease compared to last year's loss of VND199 billion. This is also the 14th consecutive quarter that HAGL Agrico has recorded a loss.

At the same time, the Company had 116.4 billion VND in financial expenses incurred during the period, including: 54.2 billion VND in exchange rate loss due to revaluation of foreign currency debts and 62.2 billion VND in interest expense arising from previous loans of rubber and palm oil projects. The combination of the above factors caused the Company to continue to incur losses.

In the first 9 months of 2024, HAGL Agrico brought in VND 288 billion in net revenue, down 34%, but had a loss after tax of VND 546 billion (the same period last year, a loss of VND 446 billion) due to operating below cost price, thereby increasing HNG's accumulated loss to VND 8,648 billion. The 9-month loss also far exceeded the target of only VND 120 billion in pre-tax loss approved by the 2024 HNG Shareholders' Meeting.

HAGL Agrico lost an additional 182 billion VND in the third quarter of 2024.

Explaining further about the poor business results, in addition to the above-mentioned exchange rate difference loss, HAGL Agrico said the cause of the loss also came from the decrease in fruit tree output. Compared to the same period, fruit output only reached 2,903 tons, down 56%. The suspension of production of a part of the banana growing area for care and land improvement caused the banana output to decrease during the period.

Specifically: The area of ​​banana gardens harvested during the period decreased from 1,920 hectares to 494 hectares. Due to the area of ​​perennial banana gardens, the quality and productivity were no longer effective, so the company had to stop taking care of them to focus on renovating the land and renovating the garden to improve quality and efficiency.

At the same time, the company is implementing a factory model with investment in completing synchronous infrastructure, mechanized machinery and equipment, applying new technical processes to stabilize output, improve productivity and quality in the coming time.

Regarding rubber trees, rubber output reached 2,401 tons, equivalent to revenue of VND89.8 billion. The area of ​​rubber plantation has been completed to 15,192 hectares, but the company has only effectively exploited 4,932 hectares. Meanwhile, HAGL Agrico still has to calculate depreciation for the entire area of ​​plantation, including the unexploited part, leading to increased costs.

HAGL Agrico's short-term debt increased by more than 2,000 billion VND

At the end of the third quarter of 2024, HAGL Agrico's total assets increased by nearly VND 1,900 billion compared to the beginning of the year (15%), reaching VND 15,948 billion.

The majority of HAGL Agrico’s remaining assets are long-term assets, located in land plots and construction investment funds. Of which, fixed assets account for VND5,443 billion. This asset has been depreciated by VND3,223 billion. Long-term unfinished assets account for VND5,619 billion, VND1,200 billion higher than at the beginning of the year, mainly the cost of developing fruit orchards and rubber orchards.

Short-term debt during the period increased by VND 2,060 billion, accounting for VND 8,271 billion.

The capital structure in the first 9 months of the year also showed a sharp increase in short-term debt.

Specifically, total liabilities accounted for VND14,089 billion, equivalent to 88% of the company's capital. Short-term debt during the period increased by VND2,060 billion, accounting for VND8,271 billion.

In contrast, long-term debt decreased by more than VND600 billion, to VND1,410 billion. HAGL Agrico's total debt is VND9,681 billion, 5.2 times higher than its equity.

HNG's largest creditor is Truong Hai Agriculture JSC with VND7,757 billion, up 42% compared to the beginning of the year, including VND272.7 billion in short-term loans and VND7,487 billion in long-term loans. Hoang Anh Gia Lai JSC (HOSE: HAG) is also lending HNG VND1,019 billion, down nearly VND100 billion.

On the stock market, HNG shares have been delisted and traded on UPCoM since September 18. 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.

Previously, in the semi-annual report, the auditor emphasized the ability to operate continuously, the reason being that HAGL Agrico at that time had an accumulated loss of VND 8,466 billion. Short-term debt exceeded short-term assets and violated some terms of the loans.

HAGL Agrico explained: Currently, the company is continuing to implement projects to ensure cash flow for business operations, restructuring some debts and working with related parties to resolve debts and receive land use right certificates for projects in Laos and Cambodia, to implement legal procedures for project investment and mobilize capital to have investment cash flow. On this basis, the Company has prepared and presented the 6-month 2024 Financial Statements meeting the assumption of continuous operation within the next 12 months.

A banana plantation in Laos of HAGL Agrico. Photo: Thaco

HAGL Agrico said it is trying to improve its business operations. This year, HAGL Agrico 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.

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 hopes to generate profits in the near future. From there, it will gradually reduce accumulated losses on the financial statements,” HAGL Agrico emphasized.

Reporting on the large-scale agricultural investment project for the period 2024-2028, HAGL Agrico leaders want to plan a specialized fruit tree growing area of ​​up to 10,000 hectares (including 8,000 hectares of bananas and 2,000 hectares of pineapples).

Planning area for cattle breeding combined with fruit tree planting up to 14,000 hectares (including 5,000 hectares of fruit trees including mango, grapefruit, durian and herd size of 210,000 cows).

Total investment capital is 18,090 billion VND (about 750 million USD). Investment progress from 2024 to 2028.

Accordingly, by 2025-2028, the company plans to export 624,000 tons of fresh fruit per year, 25,000 tons of processed fruit per year, 12,000 breeding cattle per year and 17,000 tons of commercial beef per year.

The expected efficiency by 2025-2028 will reach revenue of 13,500 billion VND (equivalent to 550 million USD) and will have profit of 2,450 billion VND (about 100 million USD).

Source: https://danviet.vn/hagl-agrico-bao-lo-quy-thu-14-lien-tiep-no-vay-ngan-han-tang-them-hon-2000-ty-dong-20241030140932025.htm