With only 9 shareholders attending, Nam Bay Bay (NBB) cannot hold the 2023 Annual General Meeting of Shareholders.

Only 9 out of 7,677 shareholders attended, accounting for 46% of shares, so Nam Bay Bay (NBB) could not hold the shareholders' meeting.

Nam Bay Bay Investment Joint Stock Company (code NBB) has just held its 2023 annual general meeting of shareholders to announce its 2022 business results and business plan for this year. However, due to insufficient number of registered shareholders, the meeting could not be held successfully.

Specifically, according to the list of shareholders attending the meeting on March 30, 2023, there were 7,677 shareholders holding 100,159,795 shares. However, on the day of the meeting, only 9 shareholders representing 46,139,220 shares attended, equivalent to 46.07% of the total number of shares with voting rights.

Only 9 shareholders attended, so the 2023 annual general meeting of shareholders was not held. Image 1 — Only 9 shareholders attended the meeting of Nam Bay Bay Investment (NBB) - (Photo TL)

According to the law, the first annual general meeting of shareholders must have at least 50% of the total number of voting shares attending. Therefore, the first annual general meeting of shareholders of NBB could not be held.

Regarding the price movement of NBB shares, in the trading session on April 27, 2023, NBB shares were only traded at VND 12,900/share, only about 2/3 of the price achieved 1 year ago.

Nam Bay Bay mobilizes an additional VND 751.2 billion from shareholders, not expected to pay dividends in 2022

There are many reasons why shareholders are not enthusiastic about attending the General Meeting of Shareholders. However, the notable contents of the meeting also have some impact on the psychology of the participating shareholders.

According to the 2023 General Meeting of Shareholders documents, the company plans to set a revenue target of VND 800 billion, an increase of 71.7% compared to 2022, and after-tax profit is expected to be only VND 20.5 billion, although not high, it has increased nearly 2.5 times compared to last year.

It can be seen that the 2023 target of Nam Bay Bay has increased significantly compared to the results achieved in 2022. However, if we look closely, we can see that in 2022, Nam Bay Bay's business was extremely poor, and its after-tax profit "evaporated" a significant part.

Specifically, in 2022, revenue was recorded at VND466.4 billion, down 17.5%. Cost of goods sold accounted for VND239.4 billion, gross profit was VND227 billion, down 11.1%.

Financial revenue decreased by 65.2% to only VND151.4 billion while financial expenses increased sharply, from VND165.9 billion to VND266.2 billion, an increase of 60.5%. Interest expenses also increased from VND99.3 billion to VND168.6 billion, putting great pressure on the company's profits.

The most obvious impact is that the company's after-tax profit has decreased sharply, recorded at only 17.7 billion VND, down 94.3% compared to the level achieved in 2021.

With the declining business results in 2022, it is not difficult to understand why Nam Bay Bay planned not to pay dividends for 2023, and also decided to cancel the plan to pay a 15% dividend for 2022 because the company encountered many difficulties in business and capital mobilization.

Despite canceling the dividend payment plan, Nam Bay Bay continued to raise capital by offering shares to existing shareholders at a rate of up to 50%, equivalent to each shareholder owning 2 shares will receive 1 right to buy new shares at a price of 15,000 VND/share. Meanwhile, the price of NBB shares on the market in the trading session on April 27, 2023, NBB shares are priced at 12,900 VND/share, so it can be clearly seen that this capital mobilization plan is almost impossible.

Business cash flow is negative to 953.6 billion VND, debt increases

In 2022, Nam Bay Bay's total assets reached VND 6,401.5 billion, an increase of 46.4% compared to the beginning of the year. However, the increase in assets mainly came from recording in payables, increasing from VND 2,543.5 billion to VND 4,570.3 billion, equivalent to an increase of 79.7% in just 1 year.

In NBB's asset structure, the most notable is the increasingly expanding debt structure, mainly coming from financial indicators on long-term loans and financial leasing debt, increasing from 350 billion VND to 2,158.2 billion VND, corresponding to the long-term debt increasing to 1,808.2 billion VND in just 1 year.

Notable loans include the largest loan at the Joint Stock Commercial Bank for Foreign Trade of Vietnam, amounting to VND567.2 billion. In addition, NBB is also borrowing long-term from 3 other entities with an amount of up to hundreds of billions of VND, including: Lu Gia Real Estate Investment and Trading Company Limited with VND400 billion; Hanoi Highway Investment and Construction Joint Stock Company with VND400 billion; CII Infrastructure Construction Joint Stock Company with VND350 billion.

NBB's cash flow statement also recorded a negative net cash flow from operating activities in 2022 of VND 953.6 billion, while in the same period it was also negative VND 103.2 billion. This shows that Nam Bay Bay is not earning enough to cover expenses and has a huge shortage of cash to maintain business operations. Thus, it is not too difficult to understand that the debt structure of this unit is increasingly expanding, meaning that the risks in the capital structure are also increasing.

Source