CIC Group (CKG) has all debt assets, still issuing 201 billion more shares

CIC Group (CKG) offers 13.4 million shares to raise VND201 billion

On September 11, 2023, CIC Group (Code CKG) approved the continuation of the private offering plan of 13,400,219 shares to professional securities investors. The offering price of the shares will be VND 15,000/share. Thus, with this offering plan, CIC Group expects to collect VND 201 billion.

Previously, CIC Group also planned to conduct a share offering with similar quantity and price. The amount of 201 expected to be collected under this plan will be used by the company: 97.3 billion VND to pay debts to contractors; 96.8 billion VND to pay due loans and 6.9 billion VND to buy materials and pay salaries to staff. Thus, most of the money collected from the offering will be used to pay debts.

CIC Group continues to raise 201 billion from issuing shares — CIC Group (CKG) raised an additional VND201 billion from issuing shares (Photo TL)

Regarding the business situation, in the second quarter of 2023, CIC Group achieved revenue of VND 372.8 billion, down 7.2% over the same period last year. Gross profit reached VND 113.2 billion, gross profit margin decreased from 31.1% to only 30.4%.

There were fluctuations in expenses during the period, notably financial expenses increased by VND8.6 billion, equivalent to an increase of 59%. Sales expenses and administrative expenses accounted for VND3.9 billion and VND34.8 billion, respectively. CKG's after-tax profit reached VND58.6 billion, down 16.5% over the same period.

CKG's accumulated revenue in the first 6 months of the year reached 623.9 billion VND, profit after tax reached 84 billion VND. Compared to the target plan in 2023 with revenue of 1,234.9 billion VND and profit after tax of 175 billion VND, the company has only completed 47.1% of the revenue plan and 48% of the annual profit plan.

Assets worth trillions but mostly debt, cash decreased more than 3 times, maintained at a low level

By the end of the second quarter of 2023, CKG's total assets reached VND 4,729 billion, a slight decrease compared to the beginning of the year. Notably, the company only owns VND 20.5 billion in cash. In addition, the company also has an additional VND 3.5 billion in bank deposits.

Compared to the beginning of the period, it can be seen that the company's cash has decreased by nearly 70%. The amount of money deposited in the bank has also decreased from 14.7 billion to 3.5 billion VND, equivalent to a decrease of 76%.

In the asset structure of CIC Group, inventories account for 2,839.6 billion VND, a slight increase compared to the beginning of the year. Most of which are production costs and unfinished business. Goods and raw materials account for only over 5 billion VND.

Regarding capital structure, most of CKG's assets are recorded as debt, accounting for VND 3,416.7 billion, equivalent to 72.2% of total existing capital.

Of which, short-term debt accounts for 664.9 billion VND. Long-term debt and financial leases also account for 891.2 billion VND. CKG's total current debt is 1,556.1 billion VND, 18.6% higher than current equity.

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