Profit decreased by 76%, cash 'evaporated' nearly 2,000 billion, PC1 Group issued 40 million shares to pay dividends

Issue 40 million shares to pay dividends in 2022

PC1 Group Corporation (HoSE Code: PC1) has just announced the issuance of 40.5 million shares to pay 2022 dividends at a rate of 15%. Equivalent to each shareholder owning 100 shares will receive a dividend of 15 additional shares.

With the above number of shares, the total par value of the issuance will be more than 405.6 billion VND. The capital for the issuance will be taken from the undistributed profit after tax on the audited consolidated financial statements as of December 31, 2022 of the company.

Profit decreased by 76%, cash evaporated nearly 2000 billion, PC1 group issued 40 million shares with dividend payment, image 1 — PC1 Group Corporation (HoSE: PC1) profit decreased by 76.3%, cash decreased sharply. Plan to issue 40 million shares to pay dividends to shareholders (Photo TL)

The expected issuance time will be in the fourth quarter of 2023 after the State Securities Commission approves the issuance plan.

Regarding the performance of PC1 shares, in the trading session on October 6, 2023, PC1 shares were traded at VND 30,850/share, up 2.83% compared to the previous session. PC1 code also fluctuated around VND 30,000/share in the trading sessions of September despite many market fluctuations.

Profit after tax decreased by 76.3% compared to the same period

Regarding business results, PC1 recorded net revenue in the first 6 months of 2023 at VND 2,977.4 billion, a slight decrease compared to the same period. Gross profit reached VND 590.2 billion, corresponding to a gross profit margin decrease from 23.3% to 19.8%.

Financial revenue during the period tripled from VND30.5 billion to VND94.5 billion. However, financial expenses also increased from VND336.2 billion to VND441.2 billion. Notably, interest expenses increased by 68.8% to VND421.4 billion.

Sales expenses and administrative expenses both increased during the period despite no growth in revenue, accounting for VND5.7 billion and VND145.3 billion, respectively. PC1's after-tax profit reached VND58.5 billion, down 76.3% over the same period.

According to PC1's explanation, the reason for the decline in profits was due to weather factors. The El Nino phenomenon has had a strong impact on hydropower operations. The second quarter is also the weak wind season of the year, so wind power output has also been affected.

Coupled with the difficult credit market and high interest rates, the company's borrowing costs have eroded a large portion of its gross profit.

Cash decreased by nearly 2,000 billion, debt exceeded equity

At the end of the second quarter of 2023, PC1's total assets were recorded at VND 19,716.8 billion, down VND 1,887.7 billion compared to the beginning of the year.

Notably, the cash and cash equivalents index decreased from VND2,937.2 billion to only VND949.4 billion, equivalent to a decrease of VND1,987.8 billion. In return, short-term deposits increased from VND655.3 billion to VND1,086.1 billion.

In the company's capital structure, payables account for VND12,664.7 billion, equivalent to 64.2% of total capital. Short-term debt accounts for VND2,415.5 billion, down nearly 1/3 compared to the beginning of the year. However, long-term debt still accounts for VND8,472.5 billion, much higher than PC1's equity.

PC1's equity at the end of the second quarter reached VND7,052.1 billion. The company recorded undistributed profit after tax of VND1,217.7 billion and the development investment fund currently accounts for VND292.7 billion.

Source