Stopping debt payments, HHP Global wants to "swap" 100 billion VND of mobilized capital to invest in subsidiaries

HHH Global wants to change the purpose of using 100 billion VND of capital raised from the private offering of shares in 2023-2024. Specifically, the purpose is to change from paying off loans at credit institutions to contributing capital to a subsidiary - Hoang Ha Phu Yen Paper Joint Stock Company.

"Swap" 100 billion VND of mobilized capital to invest in subsidiaries

The Board of Directors (BOD) of HHP Global Joint Stock Company (stock code: HHP) has just announced a resolution on supporting its subsidiary - Hoang Ha Phu Yen Paper Joint Stock Company to speed up the progress of implementing a paper factory with a capacity of 100,000 tons of products/year.

The Board of Directors of HHP agreed to submit to the 2024 annual general meeting of shareholders (AGM) for approval the policy of increasing the charter capital ownership ratio at Hoang Ha Phu Yen Paper Company to a minimum of 65% and a maximum of not exceeding 80%.

At the same time, submit to the General Meeting of Shareholders a plan to change the plan to use capital raised from the private offering of shares to increase the company's charter capital in 2023-2024. Specifically, HHP will use the expected VND 100 billion to pay off loans at credit institutions to contribute capital to Hoang Ha Phu Yen Paper Company.

Regarding the policy of supporting this subsidiary, HHP said it will continue to mobilize experienced staff and experts to implement the HHPPaper Hai Phong Factory project to participate in supporting management, technology and equipment selection, bidding, contract negotiation with contractors... and other work related to the subsidiary's 100,000 tons/year paper factory project.

In addition, HHP will support working with Vietnam Joint Stock Commercial Bank for Industry and Trade - Tien Son Branch ( Vietinbank Tien Son), a bank that has a credit relationship with the parent company to provide credit to the subsidiary, including negotiating terms and conditions for loans; giving priority to supporting the subsidiary with maximum capital to implement factory investment with the condition of ensuring capital for production and business activities at the parent company...

Previously, from the end of 2023 to January 2024, HHP invested 51 billion VND in capital, equivalent to 51% ownership of charter capital of Hoang Ha Phu Yen Paper Company.

At that time, HHP said that the purpose of contributing capital to the subsidiary was to increase the ecosystem of HHP's manufacturing enterprises to expand product segments, expand market share, increase output, and enhance the company's position in the paper production sector in the Northern and Central regions.

Quarter I completed 13% of profit plan, double the previous year's performance

In 2023, HHP's consolidated revenue after tax will reach VND 1,109 billion, up 17% compared to 2022 and reaching 86% of the plan. Consolidated profit after tax will reach VND 21 billion, equivalent to a decrease of nearly VND 16 billion, reaching 57% compared to 2022 and 54% of the plan.

According to HHP, the main reason for the increase in revenue comes from commercial activities (sales revenue) accounting for 79% and production activities (revenue from semi-finished products) accounting for 21% and the remaining revenue (from infrastructure exploitation and electricity, water, and collection protection) is 0.13%.

Regarding after-tax profit, although in the year the subsidiary (Hoang Ha Ha Nam Paper Company) recorded an increase of 51 million VND in provisional after-tax profit and in the year the acquisition of a subsidiary (3C Pro Investment Joint Stock Company) recorded an increase of 490 million VND in provisional after-tax profit and a profit from the transaction of buying shares at a discount of 1.7 billion VND.

However, the parent company's profit decreased significantly when the exchange rate difference of the foreign currency debt account payable to the equipment supplier and the production stoppage at the old factory to prepare for the new factory occurred, causing the consolidated company's after-tax profit to decrease.

In 2024, HHP sets a revenue target of VND 1,850 billion, an increase of 66% compared to 2023. Profit after tax reaches VND 44.8 billion, an increase of 113% compared to the previous year.

At the end of the first quarter of 2024, HHP's revenue recorded nearly 412 billion VND, an increase of 73% over the same period last year and completing 22% of the yearly plan. Profit after tax reached nearly 6 billion VND, down 40% over the same period and completing 13% of the plan.

Duong Chung (According to thoibaotaichinhvietnam.vn)

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