Trung Nam Solar Power makes big profits after the shock

Trung Nam Group's solar power business, chaired by Nguyen Tam Thinh, unexpectedly reported a large profit after a year of record losses and a scandal related to improper incentives.

“After a record loss in 2023, Trung Nam Thuan Nam Solar Power Company Limited unexpectedly reported a profit of VND138 billion in 2024, according to a financial report recently published on the Hanoi Stock Exchange (HNX). A member operating in the solar power sector of Trung Nam Group unexpectedly reported a profit after tax of VND138 billion in 2024, after a record loss of thousands of billions of VND in 2023.

Thanks to the 2024 profit, Trung Nam Thuan Nam's accumulated loss decreased to more than VND849 billion.

Trung Nam Thuan Nam's equity, therefore, increased from nearly VND 1,424 billion at the end of 2023 to more than VND 1,562 billion at the end of 2024.

Trung Nam to return to profit in 2024 after a year of trillion-dollar losses. Source: Financial Statements

Bank debt decreased from nearly VND 1,534 billion to VND 1,318 billion. Bond debt decreased from more than VND 4,730 billion to nearly VND 4,577 billion.

However, the debt/total assets ratio is still very large, on the "red line", at 0.85 times (compared to 0.86 times at the end of 2023). The debt/equity ratio is sky-high: 5.62 times by the end of 2024, compared to 6.4 times at the end of 2023.

Thus, the total debt of Trung Nam Thuan Nam by the end of 2024 is still nearly 8,778 billion VND - a very large number.

With the new figures, Trung Nam Thuan Nam's financial situation has improved but remains at a worrying level.

The report was signed by Chairman Nguyen Tam Thinh and submitted to HNX and audited by AASC Auditing Company Limited. The report was released after Trung Nam was embroiled in a scandal related to improper preferential treatment.

After that, many officials of the Ministry of Industry and Trade were prosecuted.

Trung Nam Thuan Nam is the investor of a 450 MW solar power plant combined with a transformer station and 220/500KV line in Ninh Thuan province (old).

Trung Nam Construction Investment Joint Stock Company (Trung Nam Group) was established in 2004, focusing on the following areas: Energy, infrastructure - construction, real estate, electronic information industry. This enterprise started from the infrastructure construction sector, then invested in real estate and hydropower, and recently in the renewable energy sector with a series of solar and wind power projects.

Some large projects such as Trung Nam Thuan Nam solar (Binh Thuan/Ninh Thuan), Ea Nam wind power, Trung Nam - Tra Vinh wind power...

Trung Nam Group has a history of 20 years of operation but has developed very strongly, grown rapidly in the past 10 years and has a huge scale, up to billions of USD in asset value. By the end of 2022, Trung Nam Group has total assets of up to 96,000 billion VND.

The reason why Trung Nam Group has grown so quickly in scale is because in the past decade, the group has invested heavily in renewable energy, requiring huge capital to be able to carry out such projects.

On its website, the group said that by October 2021 it had contributed 1.63GW of energy to the national grid, leading the private sector in the industry.

Along with increasing capital, Trung Nam Group is known as a corporation with very large debts, of which the preferred channel is bonds.

By the end of 2023, according to a report sent to the Hanoi Stock Exchange, Trung Nam Group had total liabilities of more than VND 65,100 billion, a decrease of about VND 3,000 billion compared to the end of 2022. Total bond debt was about VND 18,217 billion, a decrease compared to VND 24,270 billion at the end of 2022.

Trung Nam Group suffered heavy losses in 2023. Source: Financial statements

At the end of November 2023, Trung Nam Group announced information about the late payment of interest due of nearly VND 107 billion for a bond lot with a total value of VND 2,000 billion.

By mid-2024, Trung Nam Group still owes 23,562 billion VND in bank loans and 20,245 billion VND in bond loans.

In 2023, Trung Nam Group lost more than VND 2,878 billion, compared to a profit of VND 252 billion in 2022 and a profit of VND 1,635 billion in 2021.

Trung Nam Group has many members such as: Trung Nam Dak Lak 1 Wind Power Joint Stock Company (investor of Ea Nam wind power plant project with a scale of 600 hectares), Trung Nam Solar Power, Trung Nam Tra Vinh Solar Power, Trung Nam Ninh Thuan.

The big guy leaves the game, Trung Nam Solar Power, which is in huge debt, turns around to make strong profits . Trung Nam Group, due to cash flow difficulties, had to sell controlling interest in its largest solar power project. Ironically, this is also the time when the project has positive news after a difficult period.

Source: https://vietnamnet.vn/dien-mat-troi-trung-nam-lai-lon-sau-cu-soc-2426040.html