The Entrepreneurial Promise and the Shift in Profitability
In the middle of last year, Mr. Nguyen Quoc Cuong (also known as Cuong "Do La") was selected as General Director of Quoc Cuong Gia Lai Joint Stock Company (stock code: QCG). This change took place after the incident in which Ms. Nguyen Thi Nhu Loan - Mr. Cuong's mother - was prosecuted and temporarily detained to serve the investigation in the case that occurred at the Vietnam Rubber Industry Group and Dong Nai Rubber Company.
Not long after taking the "hot seat", Mr. Cuong attended the annual general meeting of shareholders of Quoc Cuong Gia Lai at the end of July 2024. At this time, he expressed his thanks and appreciation for the shareholders' feelings when sending his greetings and encouragement; hoping that shareholders would accompany and stand side by side with the company in the coming time.
In the above meeting, Mr. Cuong expressed his commitment and determination to revive Quoc Cuong Gia Lai after the storm twice. The first time, he pledged that from now on, as the general director, he would do everything to protect the interests of shareholders. The second time, he promised that all business activities of Quoc Cuong Gia Lai in the near future would return to normal.
At the end of 2024, Quoc Cuong Gia Lai announced that Ms. Loan had been changed to preventive measures by the Ministry of Public Security's Investigation Police Agency on November 11. She was released on bail while the authorities investigated the case.
It has been nearly a year since Mr. Cuong took the top position in the executive board. Quoc Cuong Gia Lai is preparing to hold its 2025 annual general meeting of shareholders this weekend (May 17).
Over the past year, the company has had many important changes in its business situation and operating results. The most obvious is that the company continuously records apartment handovers and improves revenue and profit.
Previously, in 2023 and the first half of 2024 (before Mr. Cuong became CEO), Quoc Cuong Gia Lai's profits were quite thin, even losing money due to reasons such as real estate difficulties, projects being difficult to implement...
However, from the second half of 2024 until now, in the context of the market being legally cleared and liquidity "brighter", Quoc Cuong Gia Lai has accelerated the handover of apartments as Mr. Cuong mentioned.
In the fourth quarter of 2024, the company recorded net revenue of nearly 486 billion VND, more than 3 times higher than the same period last year; after-tax profit of more than 63 billion VND, nearly 5 times higher.
In the first quarter of this year, thanks to boosting sales and increasing apartment deliveries, Quoc Cuong Gia Lai achieved a profit after tax of more than VND8 billion, many times higher than the low base level of the same period last year. Revenue from the real estate sector increased sharply, while the rubber and electricity sales sectors remained stable.
The amount of 2,882 billion VND to be paid to Van Thinh Phat is still there.
One of the outstanding issues at the time Mr. Cuong sat in the "hot seat" was the amount of 2,882 billion VND that the company had to pay back to Ms. Truong My Lan (related to the Van Thinh Phat case).
At that time, Mr. Cuong planned to turn the cash flow by divesting from hydropower projects, handling inventory, and developing the Marina Da Nang project. The total revenue would be about 3,000 billion VND. According to him, this plan is feasible, if facing difficulties, he will divest from some other companies.
Current status of the Marina Da Nang project area (Photo: Hoai Son).
Regarding the divestment of hydropower plants, in early 2024, Quoc Cuong Gia Lai wants to approve the transfer of Ia Grai 2 hydropower plant and Ayun Trung hydropower plant of its subsidiary - Quoc Cuong Hydropower Construction Investment Company - along with the assets of these two plants to restructure investment. The total transfer value is expected to be about 615 billion VND.
In the first quarter report this year, Quoc Cuong Gia Lai still owns 90% of the capital of Quoc Cuong Hydropower Company.
Another thing is that Mr. Cuong wants to handle inventory. As of March 31, the company's inventory still reached nearly VND1,262 billion, about VND17 billion lower than at the beginning of the year. Inventory accounts for 14% of total assets.
According to the notes, the inventory is mainly unfinished real estate under construction (compensation costs, land use fees, construction costs related to the project), accounting for 46% and real estate goods accounting for 51%. In the first 3 months of the year, the company reduced the inventory of real estate goods by 44 billion VND and increased investment in unfinished real estate by 24 billion VND.
Regarding Quoc Cuong Gia Lai's project in Da Nang, the Da Nang Department of Construction recently announced that it is eligible to do business with future housing. There are 34 future housing units eligible for sale here, with apartment floor areas ranging from 147.1m2 to 446.4m2.
In the consolidated financial report for the first quarter of the year, Quoc Cuong Gia Lai still recorded an amount of more than VND 2,882 billion payable to Sunny (related to Van Thinh Phat) in the Phuoc Kien project (Nha Be, Ho Chi Minh City).
Regarding this amount, the 2024 audited financial report stated that the enforcement agency is holding some compensation and site clearance records of this project until Quoc Cuong Gia Lai repays the money to Sunny before receiving the records for implementation.
However, the auditor still noted that there is a material uncertainty related to the classification to long-term assets, which may lead to significant doubt about the ability to continue as a going concern.
In a recent explanatory document sent to the State Securities Commission, Quoc Cuong Gia Lai affirmed that it is still implementing procedures to complete the legal documents of the above project, in parallel with implementing compensation and site clearance for the remaining area.
The company said its business operations remain stable with positive cash flow, net profit in 2024 reaching VND83 billion, still ensuring the ability to pay debts and maintain continuous operations in the future.
Source: https://dantri.com.vn/kinh-doanh/ong-nguyen-quoc-cuong-dang-dan-dat-quoc-cuong-gia-lai-theo-dung-loi-hua-20250512074917552.htm
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