Strong increase in financial revenue helped Novaland achieve after-tax profit of more than VND 1,600 billion, the highest since the fourth quarter of 2020.
The financial report for the fourth quarter of 2023 shows that No Va Real Estate Investment Group Joint Stock Company (Novaland - NVL) had a net revenue of nearly VND 2,028 billion, down 37%. Meanwhile, financial activities had positive results, bringing in double revenue to about VND 1,825 billion. Particularly, the profit from investment cooperation contracts recorded more than VND 1,000 billion, the rest was mainly profit from securities trading and loans.
During the period, Novaland saved up to 2.7 times in financial costs. This is due to restructuring activities. In particular, in mid-December 2023, the company reached a number of agreements related to the structure of the terms of the international bond package of 300 million USD. The management board said that the pressure on Novaland will decrease in the context of general difficulties, creating favorable conditions for this business to stabilize and recover soon.
In total, Novaland's after-tax profit was more than VND1,642 billion, up nearly 13 times over the same period. This is the highest profit since the fourth quarter of 2020.
Accumulated for the whole year, NVL had nearly VND 4,759 billion in revenue and nearly VND 685 billion in profit after tax, down 57% and 69% respectively compared to 2022. The bright spot is that sales activities account for the majority of business results with nearly VND 4,090 billion in revenue, recorded from the handover of products at NovaWorld Phan Thiet, NovaWorld Ho Tram, Aqua City, Palm City, Lakeview City, Saigon Royal and other projects.
Compared to the full-year plan, the company only completed half of its revenue target due to a decline in real estate transfer activities. However, after-tax profit was 3.2 times higher than the set target, mainly due to debt restructuring, cost optimization and financial activities during the restructuring period.
Victoria Village project (HCMC) has just topped out tower 3, other towers are also under construction. Photo: NVL
By the end of 2023, NVL's total assets reached nearly VND 241,400 billion, down 6.3% over the same period. Of which, inventories recorded nearly VND 138,600 billion, with more than 93% being the value of land funds and projects under construction. Inventory of completed real estate and real estate goods, completed real estate waiting to be handed over to customers accounted for a very small proportion.
In the past year, Novaland and the Novagroup ecosystem focused on debt restructuring. They actively negotiated to extend, change interest rates or swap debt for other assets, as well as sought to raise capital to fulfill financial obligations.
Mr. Bui Thanh Nhon's company also rearranged, prioritizing projects that are about to be completed to hand over products to customers and selected projects with high liquidity to speed up legal procedures to catch up with the recovery of the real estate market. At a meeting with the Prime Minister in mid-November 2023, CFO Duong Van Bac said that the group had passed the most difficult time and was 80% of the way to restructuring.
This year, Novaland continues to complete debt restructuring, focusing on coordinating with local authorities and agencies to resolve legal issues in projects to continue construction activities. At the same time, the company also maintains the pace of construction of projects that have had legal issues resolved in the past to hand over houses to customers.
Currently, this investor has 4 main, large-scale project clusters in Ho Chi Minh City, Dong Nai, Ba Ria - Vung Tau and Binh Thuan. Novaland said that in the last 6 months of last year, their urban areas welcomed more than 3 million visitors.
Siddhartha
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