Tasco merges with SVC Holdings, revenue increases 4 times, profit drops 74%
Recently, the Hanoi Stock Exchange (HNX) announced the private issuance of 543.88 million HUT shares to exchange for shares for SVC Holdings shareholders. These privately issued shares will be restricted from transfer for 1 year.
The issuance of shares in exchange for shares to SVC Holdings shareholders is expected to significantly dilute the shares of existing shareholders. At the same time, it will cause some major changes in the asset scale and business results of Tasco after merging SVC Holdings.
Tasco (HUT) merged with SVC Holdings, revenue increased 4 times, profit dropped 74% (Photo TL)
According to the Q3/2023 business results report, Tasco achieved revenue of VND 2,556 billion due to the consolidation of SVC Holdings from September 15, 2023. Gross profit was VND 270.8 billion, more than double compared to the same period. However, gross profit margin also decreased sharply from 40% to 10.6%.
According to Tasco's explanation, after the consolidation, the costs incurred during the period increased sharply, including: Financial costs increased by 54% to VND 118.2 billion; sales costs increased by 1,735% to VND 91.5 billion; business management costs increased by 46% to VND 95.9 billion.
The increased costs caused Tasco's net operating profit to drop by 69%, to only VND6.2 billion. However, HUT's total after-tax profit reached VND12.2 billion, up 28% over the same period.
Tasco's accumulated revenue in the first 9 months reached VND 3,180.4 billion, 4 times higher than the same period. Profit after tax reached VND 29.3 billion, down 74%. Compared to the target set for 2023 with a profit after tax of VND 600 billion, Tasco has only completed 4% of the set target.
With widespread investment, Tasco's asset size continues to expand.
In his speech, former Tasco Chairman Ho Viet Ha shared the reason for investing in SVC Holdings, which is to invest in the automobile distribution and real estate sectors. Currently, SVC Holdings owns Savico, a chain of automobile distribution agencies holding 11.2% market share in Vietnam.
Tasco's multi-sector investment strategy is also demonstrated through the acquisition of Groupama Vietnam and then renamed it Tasco Insurance for VND402 billion. Tasco also plans to invest an additional VND612 billion in this company.
Continuously carrying out acquisitions, Tasco's asset scale has also continuously expanded. By the end of the third quarter of 2023, Tasco's total assets reached VND 25,089.4 billion, more than double that of the beginning of the year.
Most financial indicators increased significantly after the merger of SVC Holdings. In particular, short-term receivables more than doubled, accounting for VND3,490.3 billion. Inventories increased nearly 30 times, to VND2,948.1 billion.
Regarding capital structure, Tasco's short-term debt increased 3 times, accounting for 6,614.6 billion VND. Notably, the amount of short-term debt increased from 280.3 billion VND at the beginning of the year to 3,115.6 billion VND. Long-term debt also increased from 4,553.8 billion to 5,186.7 billion VND.
Owner's equity increased from VND 3,873.5 billion to VND 11,222 billion. Currently, Tasco's equity surplus is temporarily recorded as negative VND 852.8 billion. Undistributed profit after tax is VND 215.3 billion at the end of the third quarter of 2023.
Source
Comment (0)