Hoang Quan Real Estate (HQC) completed less than 16% of the yearly plan.

After half a year, only 15.9% of the set target was achieved.

Hoang Quan Real Estate Trading and Services Consulting Joint Stock Company (Code: HQC), a famous unit in the real estate sector with social housing projects being implemented. In 2023, the company recorded revenue growth, reaching 292.6 billion VND. However, profit after tax decreased by 72%, only recording 5.2 billion VND. With this business result, Hoang Quan Real Estate only completed 3.7% of the original target.

At the 2024 Annual General Meeting of Shareholders, the Board of Directors of Hoang Quan Real Estate proposed a relatively ambitious plan, with a target revenue of VND 2,000 billion and an expected profit after tax of VND 100 billion. Despite setting high targets, the results that HQC achieved in the first half of 2024 were relatively dismal.

After only completing 15.9% of the plan after half a year, Hoang Quan Real Estate (HQC) has a negative cash flow of 1,021 billion (Photo TL)

Specifically, revenue in the second quarter of 2024 reached 321 billion VND, but the value of returned goods sold was up to 315.9 billion, causing net revenue to be recorded at just over 5 billion VND. However, the refunded cost of goods sold of 47.5 billion helped HQC record a gross profit of 52.5 billion VND.

Financial revenue in the period reached VND 18.4 billion while financial expenses accounted for VND 35.7 billion. Sales expenses and administrative expenses also accounted for VND 1.2 billion and VND 24.1 billion, respectively. As a result, HQC recorded a profit after tax of VND 10.6 billion in the second quarter of 2024.

The company's accumulated revenue for the first 6 months of the year only reached 18.4 billion due to returned goods. The company reported a profit after tax of 15.9 billion thanks to the refunded cost of goods sold and the financial revenue recorded during the period.

Compared to the 2024 business target of after-tax profit of 100 billion VND, Hoang Quan Real Estate has only completed 15.9% of the yearly business plan.

Shareholders of Hoang Quan Real Estate are probably not surprised by this disappointing result. Since 2015, the company has only completed its plan in 2015, and in the remaining years, it has completed less than 20% of its set target.

Negative cash flow of more than 1,021 billion, HQC has inventory of 864 billion at Golden City

By the end of the second quarter of 2024, HQC's total assets reached VND 10,378.6 billion, an increase of 42% compared to the beginning of the year. Despite the sharp increase in total assets, Hoang Quan's cash balance was less than VND 45 billion.

The increase in assets mainly comes from short-term prepayments to suppliers and inventories. Notably, the inventory during the year increased sharply from VND 590.8 billion to VND 1,301.7 billion. The main part of this is the unfinished production and business costs at the Golden City Social Housing Apartment project, accounting for VND 864 billion, equivalent to 66% of the total inventory.

The Golden City Social Housing Project in Tay Ninh has a scale of 3.4 hectares, including 7 apartment blocks of 16 floors. The total investment capital of the project is about 2,233 billion VND and is currently a key project of Hoang Quan Real Estate.

Also related to social housing projects, on the capital structure of Hoang Quan Real Estate, the debt payable is recorded at 3,071.1 billion VND. Of which, short-term prepayments from buyers account for 804.2 billion VND, which is a quite positive signal.

However, HQC is also borrowing short-term debt of VND99.7 billion. Long-term debt is also recorded at VND1,269.9 billion.

Notably, in the first half of 2024, HQC recorded a negative net cash flow from operating activities of VND 1,021 billion. The net cash flow from financial activities increased by VND 1,407.3 billion, showing that the company is having to increase cash mobilization from various sources to maintain business operations.

Of which, 1,000 billion comes from stock issuance activities and 436.2 billion is borrowed money.

Source: https://www.congluan.vn/am-nang-dong-tien-1021-ty-dia-oc-hoang-quan-hqc-hoan-thanh-chua-noi-16-ke-hoach-nam-post306381.html