The tycoon kept promising
Not so good news for shareholders of Song Da Urban and Industrial Park Development Investment Joint Stock Company - Sudico (SJS), making them have to wait once more.
In a recent announcement, Sudico said it would postpone the payment of cash dividends for the years 2016-2017 from June 30, 2023 to December 31, 2024, citing the lack of funds. In case the funds are arranged to ensure production and business activities, the company will pay dividends to shareholders earlier.
In the latest change, Sudico announced a change in the 2016 dividend payment date from December 30, 2022 to June 30, 2023. The 2017 dividend payment date is from December 30, 2022 to June 30, 2023.
Including this change, Sudico has changed the 2016 dividend payment time for the 9th time and the 2017 dividend payment time for the 5th time.
Some shareholders bitterly said that they bought stocks to wait for their children to receive dividends.
Sudico is one of the big players in the real estate market with the Nam An Khanh project. It is worth mentioning that despite owing dividends, the company has always reported profits. Since 2014, Sudico has always maintained a profit after tax of over 100 billion VND/year, of which in 2016 and 2017, it reported profits of 228 billion and 179 billion VND, respectively.
In 2022, the parent company's total revenue reached VND 511 billion, an increase of 39% compared to 2021. Pre-tax profit reached VND 172 billion, an increase of 237% compared to 2021. Pre-tax profit of the entire complex reached VND 176 billion.
This year, Sudico is still confident in presenting the 2023 target plan of 10-15% growth compared to the plan set for 2022. Total consolidated revenue is 1,145 billion VND and pre-tax profit is 320 billion VND, dividend rate is 10%.
Song Da 4 JSC (SD4) has also broken its promise no less than Sudico. This company has just announced that it will postpone the payment of cash dividends for 2016 to June 28, 2024. According to the first plan, the company will pay on February 26, 2018 at a rate of 15%.
On June 28, 2022, Song Da 4 announced that it would postpone the 2016 dividend payment to June 30, 2023. According to Song Da 4, due to the lack of results in debt collection from investors, it has not been able to balance its finances. With this announcement, SD4 has extended the 2016 dividend payment 12 times in the past 5 years.
SD4 said that the company is working hard with investors to recover outstanding debts but the results are still low. Therefore, the auditor continues to give an exception opinion in the financial report prepared on December 31, 2022 on this debt.
Accordingly, the receivables are 2.5 times the payables to customers and are overdue for payment with an amount of more than 168 billion VND (nearly 4 billion VND in provisions). The efficiency of using the company's assets and equity is low, and the production and business results in 2022 are loss-making. The work of collecting debts from investors has not achieved results.
At the end of December 2022, Lilama 45.4 Joint Stock Company (L44) also announced a change in the 8th dividend payment date for the 2012 and 2013 cash dividend payment, the time was moved from December 30, 2022 to December 29, 2023.
Wait until when?
Whether the promised dividend payment date will be changed again is still uncertain. The scenario of promises and broken promises is repeated over and over again, causing shareholders to lose faith in this real estate company.
Many investors and major shareholders have had to say goodbye. At Sudico, SAM Holdings JSC has just sold all 377,600 SJS shares to reduce ownership from 0.33% to 0% of charter capital, the transaction was carried out on June 12.
Previously, National Securities Corporation, an organization related to Mr. Bui Quang Bach, a member of the Board of Directors at Sudico, had just sold 1.6 million shares out of a total registered 2.113 million shares to reduce ownership from 1.84% to 0.44% of charter capital, the transaction was conducted from April 24 to May 19.
At the end of April 2022, An Phat Investment Trading Service Joint Stock Company (An Phat Investment) won the auction to buy all 41.7 million SJS shares from Song Da Corporation (SJG). An Phat had to pay a price of VND 102,000/share, equivalent to the amount spent of VND 4,258 billion. Thus, An Phat temporarily lost 58%, equivalent to nearly VND 2,500 billion.
In the market, investors are not very interested. The trading volume of SJC shares is low, just over 31,000 units per session. At the end of the session on June 29, SJS was priced at 41,900 VND/share.
Need specific and strong sanctions
Speaking to VietNamNet newspaper, Lawyer Nguyen The Truyen, Director of Thien Thanh Law Firm, said that according to Article 135 of the 2020 Enterprise Law, dividends must be paid in full within 6 months from the date of the end of the Annual General Meeting of Shareholders.
The Board of Directors shall prepare a list of shareholders eligible to receive dividends, determine the dividend level paid for each share, the deadline and form of payment at least 30 days before each dividend payment.
According to Mr. Truyen, there are no specific sanctions for businesses that delay dividend payments beyond the prescribed time, because this is an internal matter of each business, and the law does not interfere too deeply.
However, Mr. Truyen suggested that it is necessary to add sanctions to ensure the rights of shareholders, specifically small shareholders, because in reality there are many businesses that do not pay dividends to shareholders for 4-5 years.
This includes setting a financial penalty large enough to ensure that the business will suffer the consequences if it fails to fulfill its dividend commitment. The penalty can be calculated based on the rate or amount of the committed dividend and it must be tough enough to put pressure on the business.
In addition, applying sanctions in the form of business bans and market participation bans to enterprises that do not pay dividends as committed can put strong pressure on enterprises and create serious consequences if they do not fulfill their commitments.
On the shareholder side, Mr. Truyen said that if the company does not pay dividends as committed, shareholders have the right to request compensation or restore their rights through litigation.
This can send a message to other businesses about the importance of keeping commitments or else it will affect the business's reputation.
Mr. Truyen said that investors need to note that litigation can be time-consuming and costly, so shareholders need to consider carefully before deciding to file a lawsuit.
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