Dat Phuong Son Tra's profit reached 47% of its revenue.

Recently, the Board of Directors of Dat Phuong Group Joint Stock Company (HOSE: DPG) announced several decisions related to lending and loan guarantees for its subsidiary - Dat Phuong Son Tra Hydropower Joint Stock Company.

Specifically, on November 21, 2023, the Board of Directors of Dat Phuong issued Decision No. 44 regarding a loan of up to 500 billion VND to Dat Phuong Song Tra Hydropower Joint Stock Company, with a loan term of 1 month, for the purpose of supporting production and business activities.

One day later, the Board of Directors of Dat Phuong issued Decision No. 48, approving the pledging of shares and all rights arising from the number of shares owned by the Company in Dat Phuong Son Tra to secure a medium- and long-term loan for the Son Tra hydropower project at BIDV Bank.

The project is invested by Dat Phuong Son Tra. The total mortgage value at face value is nearly 384 billion VND. Dat Phuong commits to unconditionally and irrevocably guaranteeing to repay the debt on behalf of Dat Phuong Son Tra in the event that this subsidiary fails to repay the loan to BIDV in full and on time.

The image is a screenshot from Dat Phuong's 2022 annual report. — Dat Phuong's impressive profits in the electricity sector. Image extracted from DPG's 2022 annual report.

According to Dat Phuong's 2022 annual report, Dat Phuong Son Tra Hydropower Joint Stock Company manages and operates the Son Tra 1A-1B-1C hydropower plants, and also carries out the final settlement of the Son Tra 1C project.

2022 was the first year that all three Son Tra 1A-1B-1C hydropower plants were fully operational, and they operated stably and efficiently without any serious incidents.

This contributed to Dat Phuong Son Tra Hydropower Joint Stock Company achieving a revenue of 503 billion VND, while the company reported a net profit after tax of nearly 236 billion VND. Correspondingly, for every 100 VND in revenue, Dat Phuong Son Tra earned a profit of nearly 47 VND.

Revenue structure of Dat Phuong in the first 9 months of 2023. Image: Screenshot. — Revenue structure of Dat Phuong in the first 9 months of 2023. Image: Screenshot

Meanwhile, according to Dat Phuong's recently published Q3/2023 financial report, at the end of the first nine months of 2023, the company's revenue reached VND 2,026 billion, a decrease of 9% compared to the same period.

Looking at Dat Phuong's revenue structure during the period, it can be seen that, with 1,631 billion VND, revenue from construction contracts accounted for 80% of Dat Phuong's total revenue. At the same time, Dat Phuong's construction segment performed well in the past period, increasing by 25% compared to the same period last year.

Meanwhile, revenue from the sale of finished electricity by Dat Phuong in the first nine months of the year reached VND 355 billion, accounting for 17.5% of total revenue and decreasing by 25% compared to the first nine months of 2022.

However, Dat Phuong's gross profit margin from selling finished electricity is higher at 67.6%, while the gross profit margin from the construction segment is only 7.5%.

At the end of the first nine months of 2023, Dat Phuong reported a net profit of VND 168 billion, a decrease of 55% compared to the same period last year. It is known that in 2023, Dat Phuong planned to achieve a net profit of VND 287 billion; thus, the company has only achieved 58% of its profit target after nine months.

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