Mobile World Group plans to issue ESOP shares of no more than 2%.

Mobile World Investment Corporation has just announced a proposal to its annual general meeting of shareholders regarding a plan to issue shares to the executive board and key personnel (ESOP) if it exceeds 110% of its after-tax profit target.

According to the proposal, if the company's after-tax profit falls below 110% of the plan, the company will not issue ESOP shares. If the company achieves 110% or more of its profit target, for every 1% of after-tax profit exceeding this target, the ESOP issuance rate will increase by 0.05%. However, the maximum ESOP rate will not exceed 2% of the total outstanding shares, i.e., no more than 29.25 million shares.

Mobile World Group may reduce the aforementioned ESOP issuance rate by 80% if the average performance of MWG shares this year compared to 2023 does not achieve a minimum 10% better performance than the average performance of the VN-Index this year compared to 2023.

The issuance price is VND 10,000 per share and is expected to be implemented in 2025. Eligible buyers are key management personnel who have excelled in performance metrics and made significant contributions to the company's exceeding business targets. Shares will be restricted from transfer for two years from the date of issuance, with 50% of the shares becoming freely transferable after the first year.

This year, Mobile World Group is presenting to shareholders a target of VND 125,000 billion in net revenue and VND 2,400 billion in after-tax profit, representing a 6% increase in revenue and more than a 14-fold increase in profit compared to the previous year.

This target is similar to the plan announced in early February. At that time, the management of Mobile World Group predicted that consumer shopping demand would remain flat, or even decrease compared to last year for some non-essential items. However, the company believes there is room to continue consolidating revenue and significantly improving profit indicators thanks to a comprehensive restructuring starting in Q4/2023 with drastic changes aimed at improving operational efficiency, coupled with a sound financial foundation, increased market share for the Mobile World, Topzone, and Dien May Xanh chains, and double-digit revenue growth for the Bach Hoa Xanh, An Khang, and AVAKids chains.

The company's leadership stated that they have set goals and developed business strategies for each chain, tailored to the respective stages of the business lifecycle and market potential. Specifically, the Mobile World and Dien May Xanh chains are expected to contribute approximately 65% of revenue and generate the main profits for the company. The Bach Hoa Xanh chain is projected to contribute around 30% of revenue, achieve double-digit revenue growth, increase market share, and begin generating profits from 2024. The remaining revenue will come from the An Khang, AVAKids chains and the joint venture in the Indonesian market.

According to the newly released proposal, Mobile World Group is submitting to its shareholders' general meeting a plan to distribute cash dividends at a rate of 5% this year, equivalent to 500 VND per share. In addition, the company is also proposing to allocate up to 100 billion VND from undistributed profits to repurchase shares as treasury stock. The transaction is expected to be carried out this year through order matching.

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