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Saigontel (SGT): Profit in Q3/2023 decreased by 62.5% due to profit loss from joint ventures and affiliates 

 Sunday, November 5,2023

AsemconnectVietnam - Saigon Telecommunication and Technologies Joint Stock Company (Saigontel, code SGT - HoSE) recorded a profit of VND2.55 billion in the third quarter, cumulatively in the first 9 months of 2023 recorded a profit of VND24.84 billion, down 81.1%.

In the third quarter of 2023, Saigontel Company recorded revenue of VND270.77 billion, an increase of 33% over the same period and profit after tax recorded VND2.55 billion, a decrease of 62.5% over the same period. In particular, gross profit margin decreased sharply from 17%, to only 13%.
During the period, Saigontel Company's gross profit increased slightly by 1.7% over the same period, corresponding to an increase of VND0.59 billion, to VND35.26 billion; Financial revenue decreased by 6.9%, equivalent to a decrease of VND0.34 billion, to VND4.57 billion; Financial expenses increased by 6%, equivalent to an increase of VND0.88 billion, to VND15.44 billion; Sales and administrative expenses decreased by 12.3%, equivalent to a decrease of VND2.66 billion, to VND18.88 billion; Joint venture and affiliated company profits decreased by 72.8%, equivalent to a decrease of VND4.61 billion, to VND1.72 billion and other activities fluctuated insignificantly.
Thus, in the third quarter, although gross profit increased slightly, profit after tax still decreased sharply, mainly due to lack of profits from joint ventures and associates.
Explaining the shortfall in profits of joint ventures and affiliated companies, Saigontel Company said that from the beginning of 2023, Hung Yen Investment and Development Group Joint Stock Company is no longer an affiliated company of the Company due to its ownership ratio is 5%, so the form of investment in affiliated companies should be changed to a long-term financial investment, causing profits from affiliated companies to decrease.
Accumulated in the first 9 months of 2023, Saigontel Company recorded revenue of VND752.64 billion, down 3.4% over the same period and profit after tax recorded a profit of VND24.84 billion, down 81.1% compared to the same period last year.
In 2023, Saigontel Company sets a business plan with revenue of VND2,750 billion, an increase of 89.1% over the same period and pre-tax profit of VND412 billion, an increase of 282.9% compared to 2022. Thus, at the end of the first 9 months of 2023 with a pre-tax profit of VND41.8 billion, Saigontel Company has only completed 10.1% of the year's plan.
Increase debt to offset record negative business cash flow of VND895.2 billion
In addition to plummeting business, in the first 9 months of 2023, Saigontel Company's main business cash flow also recorded a record negative VND895.2 billion compared to the same period of negative VND65.4 billion. In addition, investment cash flow recorded a negative VND85.4 billion and cash flow from financial activities recorded a positive VND1,032.3 billion, mainly increasing debt to offset the business cash flow deficit.
It is known that, according to data from SSI Securities, from listing in 2008 to 2022, there has never been a year when negative business cash flow exceeded VND895.2 billion. Of which, the year with the largest negative cash flow was 2010 with a negative value of VND287.4 billion.
As of September 30, 2023, Saigontel Company's total assets increased by 18.3% compared to the beginning of the year, corresponding to an increase of VND1,004.6 billion, to VND6,492.6 billion. Of which, main assets in inventory recorded VND2,299.1 billion, accounting for 35.41% of total assets; Short-term receivables recorded VND1,830.8 billion, accounting for 28.2% of total assets; Long-term financial investment recorded VND1,375.4 billion, accounting for 21.2% of total assets.
During the period, asset fluctuations increased mainly due to inventory increasing by 70.5% compared to the beginning of the year, corresponding to an increase of VND950.9 billion, to VND2,299.1 billion (VND1,348.2 billion at the beginning of the year).
The Company explained that the increase in fluctuations was mainly because it was not recorded at the beginning of the year, but as of September 30, 2023, the Company recorded an investment of VND910.4 billion in the Nam Tan Tap Industrial Park project in Can Giuoc district, Long An province.
According to research, the Nam Tan Tap Industrial Park project has a scale of 244.74 hectares, total investment capital of about VND2,590.4 billion, project operation period of 50 years from August 20, 2021 to August 20, 2021. 2071. In particular, by the end of 2022, the Company shared that it had cleared 37.8 hectares out of 244.74 hectares and planned to disburse a total of 80 hectares out of 244.74 hectares in 2023.
Saigontel Company said that according to the plan, by the fourth quarter of 2023, the Company will have 30 hectares of commercial land, can receive deposit contracts from secondary investors and can record revenue and profits at the project Nam Tan Tap Industrial Park in 2024.
As for capital, as of the end of the third quarter, total short-term and long-term debt increased by 58.7% compared to the beginning of the year, corresponding to an increase of VND1,119.4 billion, to VND3,024.9 billion and accounting for 46.6 % of total capital (at the beginning of the year recorded VND1,905.5 billion and accounted for 34.7% of total capital). Of which, short-term debt is VND1,662.9 billion and long-term debt is VND1,362 billion.
N.Nga
Source: VITIC/Tinnhanhchungkhoan
 

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