Making news

HAGL forecasts 1.6 percent revenue drop in 2017

Hanoi, July 4 (VNA) - Agriculture firm Hoang Anh Gia Lai (HAGL) has predicted 6.33 trillion VND (281.5 million VND) in total revenue and 552 billion VND in pre-tax profit in 2017, the company announced at its recent annual shareholder meeting. 

Compared to 2016’s performance, the total revenue mark would be 1.6 percent lower, but pre-tax earnings would improve from a loss of 1.4 trillion VND in 2016. 

Main sources of income in 2017 are likely to be fruits (dragon fruits, passion fruits and banana) (2.6 trillion VND), rubber (745 billion VND), cattle for slaughter (1.24 trillion VND) and the real estate project HAGL Myanmar (1.14 trillion VND). 

Concerning HAGL Myanmar, HAGL chairman Doan Nguyen Duc said that the group would be willing to sell half of its stake in the project if any investors are interested in this asset. 

HAGL is seeking partners to offload its stake in the hydropower plant Nam Kong 3, and the group is proceeding to complete the sale of hydropower project Nam Kong 2. Both projects are developed in Laos. 

In the future, HAGL will increase its ownership in the subsidiaries to take control of its sub-business units. 

HAGL also forecast its profit in the first half of 2017 reached 213 billion VND, equal to 40 percent of the year’s plan and lower than expected figure as some of the sub units had not operated, thus contributing nothing to the firm’s earnings. 

Duc said that the firm will try to fulfill its 2017 target during the second half by achieving 30 percent of the targeted profit in each quarter. 

In addition, the company has successfully reduced parts of its total loans by selling business units and converting bonds into shares to offset the burden in its financial health. 

According to the group’s CEO Vo Truong Son, HAGL was able to reduce its total loans by 5 trillion VND after selling its sugar arm, HAGL Sugar JSC, to Thanh Thanh Cong Group (TTC) in May and issuing 137.5 million shares at 8,000 VND per share to convert the 1.1 trillion VND worth of loan agreement made with the Singapore-based national wealth fund Temasek in 2010. 

The 137.5 million shares issued for Temasek are forbidden from being traded within one year to keep HAGL’s share price stable, Duc said. 

However, the group will not pay dividends for 2017’s performance. Shares of HAGL are listed on the HCM Stock Exchange with symbol HAG, closing on July 3 down 4 percent at 9,100 VND per share.