Ho Chi Minh City, September 27, 2024 - No Va Real Estate Investment Group Corporation (HoSE: NVL, "Novaland" or "Group") announced the information of the 2024 Semi-annual Audited Financial Statements.
At the end of the second quarter of 2024, Novaland's audited semi-annual financial report recorded a total consolidated revenue of VND 3,731 billion, including revenue from sales, service provision and financial activities. Net revenue from sales reached nearly VND 1,891 billion, up 37% over the same period last year, recorded from the handover of projects such as: NovaWorld Phan Thiet, NovaWorld Ho Tram, Aqua City, Palm City...; net revenue from service provision reached VND 393 billion. Novaland's consolidated profit after tax in the first 6 months of 2024 recorded a loss of VND 7,327 billion compared to the independent financial report with a profit of VND 345 billion.
This difference mainly comes from the requirement to set up a provision for the current reporting period according to the auditor's own opinion. Most of which comes from the provision for land rent and land use fees payable calculated according to the 2017 land price plan of the 30.106ha Nam Rach Chiec project, An Phu ward, Thu Duc city, Ho Chi Minh city (Lakeview City project - investor is 21st Century International Development Company Limited), based on the tax authority's announcement on January 8, 2021. The value of the provision for this payable amount is VND 4,358 billion.
Lakeview City is a project that the Company exchanged with the 30,224ha project in Binh Khanh Ward, Thu Duc City - a project for which the Company completed compensation and site clearance in 2008 according to the 2004 Land Allocation Decision. In 2016, the Ho Chi Minh City People's Committee issued a Decision approving the land price plan according to market price for the 30,224ha land in Binh Khanh Ward and the Lakeview City project land to resolve the exchange for the Company with the time of determining the land price for both projects being the same time in 2008. Accordingly, after determining the value of land use rights and the value of the difference in location between the two land plots, the Company must pay an additional amount of nearly 52.7 billion VND after exchanging the project. The Company recorded this financial obligation in its accounting books in 2016.
However, on December 29, 2020, the Ho Chi Minh City People's Committee issued Decision No. 4777/QD-UBND approving the land price plan for the 30.106ha Nam Rach Chiec land plot, An Phu Ward, District 2 with the land price plan as of April 2017 (instead of 2008 as mentioned above). Accordingly, the Ho Chi Minh City Tax Department issued Notice of Land Rent Payment No. 268/TB-CTTPHCM dated January 8, 2021, Notice of Land Use Fee Payment No. 269/TB-CTTPHCM dated January 8, 2021 with the total amount of land rent and land use fees payable being nearly VND 5,176 billion. The Company does not agree with the determination of the time for calculating land use fees as April 2017 because the Company has completed compensation in 2008. On the date of issuance of the Audited Financial Statements, the Ho Chi Minh City Tax Department and the Thu Duc City Tax Department issued a Decision to terminate the validity of the decision to enforce the administrative decision on tax management to wait for the results of the settlement of land use fees and land rents by the competent authority as prescribed based on the Official Dispatch of the Ho Chi Minh City People's Committee.
According to regulations, when the State reclaims land, compensation must be made in land of equivalent value. In case there is no land, compensation must be made in cash. Novaland believes that there is enough basis to determine the time to calculate the land exchange price for the Lakeview City project in 2008. Currently, Novaland is continuing to petition the Ho Chi Minh City People's Committee and relevant departments to consider and thoroughly handle the Company. This provisioned value will be adjusted and reversed when conditions are met.
In addition, according to the auditor's own opinion, the financial revenue from lending, business cooperation, and other income from contract violation penalties arising during the period have not been collected in cash as of June 30, 2024. At the date of issuance of the semi-annual audited financial statements (September 26, 2024), all of these amounts have been recovered in cash. Therefore, these incomes will be recorded again in the 2024 financial statements.
With the support of partners, Novaland's projects are continuously re-implemented, constructed and completed for handover to customers.
Regarding the opinion of the Independent Auditor regarding the Group's going concern assumption, Novaland is continuing to implement many solutions to generate sufficient cash flow to finance the Group's operations. The Group's business activities in the first 6 months of 2024 have shown positive changes, with the value of delivered products recording revenue of VND 1,891 billion, an increase of 37% over the same period.
It is expected that in the last 6 months of 2024, Novaland will complete construction and hand over 2,600 products. In addition to the Group's maximum efforts, with the thorough direction of the Government, local agencies and departments, and positive legal signals in recent times, as well as continued support from financial and construction partners, Novaland is continuing to restructure its finances, gradually restoring business operations, restoring investor confidence and fulfilling its commitments to customers.
Currently, key projects NovaWorld Phan Thiet (Binh Thuan), NovaWorld Ho Tram (Ba Ria - Vung Tau) and Aqua City (Dong Nai) are still under construction and constantly investing in diverse utility systems and destination creation activities, expected to bring multi-experience living spaces to residents and bring a new look to localities as well as contribute to the development and completion of local infrastructure and economy.
Ending the 90-day Summer Fest (from June to the end of August 2024) with many fun, entertainment, music, sports activities, and large-scale beauty contests, NovaWorld Phan Thiet has attracted more than 2 million visitors.
With all its capabilities, Novaland always strives to maintain business operations and harmonize the interests of Customers, Investors, Partners and Stakeholders. From there, it continues to complete large-scale urban areas, contributing to changing the face and developing the economy - tourism, and social security in the provinces and cities that Novaland invests and develops.
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