Vietravel stock trading restricted over negative equity
Vietravel stock trading restricted over negative equity
The trade of Vietnam Travel and Marketing Transports JSC (Vietravel) on the Unlisted Public Company Market (UPCoM) will be restricted to Friday sessions only, starting Tuesday, as the firm has reported negative equity.
According to a notice signed by Nguyen Tuan Anh, deputy director of the Hanoi Stock Exchange (HNX), the information about Vietravel’s negative equity is sourced from its reviewed semi-annual consolidated financial statement of 2022.
HNX will lift the restriction after the company resolves the issues leading to the restriction, the northern stock watchdog stated in its notice.
Vietravel’s reviewed semi-annual consolidated financial statement of 2022 shows that by the end of the second quarter of the year, the company incurred negative equity of nearly VND104.3 billion (US$4.4 million), while its equity was some VND8 billion ($340,136) earlier this year.
Although its asset value totaled over VND2.234 trillion ($95 million), the firm was burdened with debts worth nearly VND2.339 trillion ($99.4 million).
The enterprise kept close to VND65 billion ($2.8 million) in cash, plunging 42 percent against early this year.
The tourism sector has recovered after two years of hibernation due to the COVID-19 pandemic.
Vietravel’s business results have also improved but remain low.
In particular, although its revenue in the first half of this year was double that in the same period last year to exceed VND1.2 trillion ($51 million), Vietravel reported an after-tax loss of more than VND114 billion ($4.8 million).
The figure was over VND290 billion ($12.3 million) in the same period last year.
Explaining its performance, Vietravel chairman Nguyen Quoc Ky said the loss in the first half of 2021 resulted from the business results of its subsidiaries.
However, in December 2021, the firm completed restructuring. It has since then focused on developing tourism, in addition to reducing corporate management costs, so its revenue and profit have increased.
Vietravel sold a 55.58-percent stake in Vietravel Airlines. After the deal, Vietravel Airlines is no longer a subsidiary of Vietravel and its business results would not be consolidated to Vietravel’s financial statements.
However, Vietravel Airlines is still an important affiliate of Vietravel, which holds a 43.92-percent stake of the airline.
“Although Vietravel’s business results were still negative given the poor performances of subsidiaries and affiliates, they have improved significantly from the same period in 2021,” Ky stressed.
Vietravel closed the session on Friday up 1.79 percent over the earlier session to reach VND28,400 ($1.2).
The price has risen over one percent within a month but fallen nearly five percent over the past quarter.
On September 27, 2019, 12.6 million Vietravel shares debuted on HNX with a reference price of VND40,000 ($1.7) each share.
