Hodeco (HDC) profit decreased by 96%, mobilized 300 billion from shareholders to pay debt

Hodeco mobilizes 300 billion from existing shareholders

Ba Ria - Vung Tau Housing Development Joint Stock Company - Hodeco (HDC) has just successfully offered nearly 20 million shares, increasing its charter capital from VND 1,351 billion to VND 1,550.95 billion.

The share offering was completed on June 19, 2024 with an offering volume of 19,990,244 shares. Equivalent to a sale rate of 99.95% of the total registered issuance volume of 20 million shares.

Hodeco (HDC) profit drops 96%, mobilizes 300 billion from shareholders to pay debt (Photo TL)

Through this, Hodeco raised VND299.85 billion. The remaining 9,756 shares will be canceled due to failure to issue.

Regarding the composition of shareholders, after the issuance, the major shareholder is Mr. Doan Huu Thuan, Chairman of the Board of Directors, who owns 9.85% of the charter capital. The rest is owned by small shareholders with less than 5% of the charter capital. The capital of nearly 300 billion VND obtained from the issuance will be used entirely by Hodeco to pay off debts to 4 major banks.

Profits fell more than 96%

Hodeco's capital mobilization took place in the context of Hodeco recording ineffective business results. In particular, revenue in the first quarter of 2024 reached VND 85.3 billion, down by half compared to the same period.

Gross profit reached 14.7 billion VND, down 81.4% over the same period. Accordingly, gross profit margin also decreased from 44.8% to only 17.2%.

In return, financial revenue increased dramatically to VND11.9 billion, while financial expenses decreased by 58.5% to VND8.9 billion. Sales expenses and business management expenses were reduced insignificantly, to VND11.8 billion.

The remaining after-tax profit was only VND1.1 billion, down 96.4% compared to the same period last year. It is worth noting that Hodeco has just escaped losses thanks to financial activities. In terms of core business activities, the company is losing more than VND6 billion compared to the same period when it was making a profit of VND43.5 billion.

As of the end of the first quarter of 2024, Hodeco's total capital was recorded at VND 4,753 billion. Of which, liabilities accounted for VND 2,844 billion, mostly short-term debt. Owner's equity accounted for only about VND 1,909 billion, equivalent to 40% of total capital.

Source: https://www.congluan.vn/hodeco-hdc-lai-giam-96-huy-dong-300-ty-tu-co-dong-de-tra-no-post300223.html