Leading developer posts falling profit
Leading developer posts falling profit
The net profit of real estate developer Hoang Anh Gia Lai Group declined from nearly VND1.2 trillion (US57.14 million) in 2011 to just VND352 billion ($16.8 million) last year, a drop of nearly 70 per cent, the company reported.
In its fourth quarter financial statements for 2012, Hoang Anh Gia Lai (HAG) reported that revenue for the entire year reached VND4.4 trillion ($211 million), a surge of 40 per cent from VND 3.15 trillion ($150.7 million) in 2011.
However, costs of sales climbed by 85 per cent during the year to VND3.2 trillion.
Meanwhile, revenue from financial investments declined 59 per cent to about VND498 billion ($23.8 million), while costs relating to financial investments rose by 26 per cent over the previous year to over VND674 billion ($32.2 million). Other costs ate another VND80 billion ($3.8 million) away from profits.
As of December 31, HAG’s total assets totalled nearly VND31.3 trillion ($1.50 billion), while overall liabilities totalled about VND20.5 trillion ($979.4 million), an increase of nearly VND5 trillion ($239 million) over the previous year.
Long-term payables reached VND13.75 trillion ($658 million), up from just VND8.7 trillion ($416.3 million) at the end of 2011. Of that total, bank loans accounted for VND 5.5 trillion ($263 million), international convertible and common bonds for VND3.75 trillion ($180 million) and domestic bonds VND5.4 trillion ($258.3 million).
Rising construction costs, which climbed to nearly VND9.95 trillion ($475.6 million) last year, were one of the main factors pushing up the company’s liabilities. HAG’s construction projects last year included office buildings, sugar mills, power plants and rubber plantations.
This year, HAG expects to begin construction on a $300 million commercial complex in in Yangon, Myanmar to include shopping, offices and hotels. The project has been slated for completion in 6-7 years.
Earlier this year, the group announced a plan to issue additional shares to existing shareholders at a ratio of 5:1 as well as to issue VND1.56 trillion ($75 million) worth of international convertible bonds.
vietnamnews
