Many businesses reported losses of hundreds of billions

The financial picture of listed companies has been revealed after the semi-annual financial report announcement season. Besides the leading companies with high profits, many continue to sink into losses with hundreds of billions of VND.

Truong Thanh Wood Industry Group (stock code TTF) is the company holding the "champion" in terms of losses in the first 6 months of the year. This company recorded a loss of 561 billion VND, ending a series of 4 consecutive quarters of profit reporting.

The company's financial report recorded net revenue decreasing by more than half compared to the same period last year, to only 124 billion VND.However, the main reason directly affecting profits comes from the 11-fold increase in business management costs due to provisioning for bad debts, up to nearly 400 billion VND.

By the end of the second quarter, the value of short-term receivables of Truong Thanh Wood was nearly 430 billion, down 1,100 billion VND compared to the beginning of the year, but the provision for doubtful debts increased nearly 3 times. However, the majority of the company's assets were still in this item and inventory, accounting for more than 70%.

The first half of this year is not the first time Truong Thanh Wood has reported a large loss. The company is struggling to deal with the aftermath of the crisis nearly two years ago. In the first half of 2016, Truong Thanh Wood reported a loss of nearly a thousand billion VND for the first time because the auditor discovered a shortage of inventory. In the recent annual meeting, the company's board of directors also said that they would focus on resolving the remaining problems in inventory and receivables this year.

Unlike Truong Thanh Wood, Oil and Gas Drilling and Well Services Corporation (stock code: PVD) encountered difficulties due to external objective factors, instead of difficulties from within the company.

In the first half of 2018, PVD's revenue still increased sharply by nearly 90% over the same period, but gross profit decreased by more than 91%, to only nearly 6 billion VND. According to the company's explanation,The main reason for the loss was due to the provisional contractor tax payment incurred when the rig was operating in Malaysia and increased rig maintenance costs.

In the second quarter alone, PVD's drilling service provision reported a gross loss of more than VND95 billion, double the same period in 2017.

For Hung Vuong, the story of "Pangasius King" is a combination of both cases above when losses come from internal problems within the company and from the general market.

Although it returned to profit in the third quarter of its fiscal year, the company still reported a loss of nearly VND260 billion in the first half of 2018. While its core business declined, the huge interest expense was the direct cause of the erosion of the remaining small profits.

In the last two quarters, Hung Vuong's gross profit margin was only around 4%. If we count the first 9 months of the year according to its own fiscal year, this ratio for Hung Vuong is only about 2.8%. With nearly 6,700 billion in revenue, the gross profit of this enterprise only reached less than 200 billion VND. Bearing hundreds of billions of VND in loan interest, Hung Vuong's profit, if not negative, would only be around a few tens of billions of VND.

Although Hung Vuong's business activities have not shown any signs of improvement, the positive point is that debt is on a downward trend.

As of June 30, the company's short-term debt was more than half of that at the beginning of the year, at VND3,350 billion. Long-term debt also decreased sharply from VND671 billion to VND335 billion. Since the beginning of 2018, Hung Vuong's board of directors has decided to divest capital from many subsidiaries to restructure the financial situation.

Among the businesses that lost over a hundred billion in the first half of the year, there were also two shipping companies: Phuong Dong Shipping and Trading Joint Stock Company and Vietnam Shipping and Leasing Joint Stock Company. After the golden period more than a decade ago, these two companies have been making big losses in recent years.

On the UPCoM floor, the shares of these two companies are only 400 VND and 600 VND, topping the list of stocks with the lowest market price on the stock market.