Hoàng Anh Gia Lai JSC posts biggest loss in 2020

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Workers at a Hoàng Anh Gia Lai’s banana farm. The company’s revenue mainly relied on agricultural products in 2020. Photo courtesy of HAGL Group

HÀ NỘI — The fourth quarter result of Hoàng Anh Gia Lai (HAG) showed that the company lost nearly VNĐ2.2 trillion last year as it struggled to manage businesses due to COVID-19.

Hoàng Anh Gia Lai’s net revenue increased 52.7 per cent year-on-year to VNĐ920.4 billion in the last quarter of 2020. The main source of its revenue came from selling fruits with a value of VNĐ538 billion in the same period. Revenue from selling hogs also reached VNĐ121 billion for the first time.

Despite an increase in revenue, its gross profit was zero as the selling price was affected by COVID-19. It had to sell products under cost prices. The company posted a gross loss of nearly VNĐ168.5 billion in the fourth quarter.

However, its financial activities income surged up to VNĐ784 billion in the last quarter of last year. The gain was boosted by liquidating investments and the decline of VNĐ439 billion in financial activities expenses.

When the companies’ businesses were heavily affected by COVID-19, Hoàng Anh Gia Lai’s executive board decided to review its previous data which related to estimation and provision for receivables under conservatism principles.

Accordingly, it applied a retrospective adjustment to its 2019 consolidated financial report by increasing provision for accumulated receivables, leading to a rise in general and administrative expenses and other expenses.

The result was Hoàng Anh Gia Lai reported a loss after tax of over VNĐ1.5 trillion in the fourth quarter, of which the parent comany’s loss after tax was nearly VNĐ1.2 trillion.

In 2020, its consolidated net income gained nearly 49 per cent year-on-year to VNĐ3.1 trillion and loss after tax was nearly VNĐ2.2 trillion. In 2019, the company recorded a loss after tax of over VNĐ1.9 trillion.

As of December 31, 2020, its liabilities were over VNĐ26.6 trillion, of which short-term borrowing was nearly VNĐ8.5 trillion and long-term borrowing was over VNĐ9.6 trillion.

Recently, Đoàn Nguyên Đức, president of Hoàng Anh Gia Lai, has registered to sell 21.78 million HAG shares for financial restructuring. After the deal, the number of HAG shares in Đức’s assets will decline to over 319 million units, equivalent to 34.5 per cent ownership.

Meanwhile Hoàng Anh Gia Lai also registered to sell 75 million Hoàng Anh Gia Lai Agricultural JSC (HNG) shares for loans restructuring. After the sale, the number of HNG shares that Hoàng Anh Gia Lai owns is over 330.1 million.

Both of the deals are expected to be executed under the method of agreement from February 5 to March 5.

At current prices, the deals will bring over VNĐ93 billion for Đức and more than VNĐ800 billion for Hoàng Anh Gia Lai.

On the Hồ Chí Minh Stock Exchange (HoSE), HAG shares were traded at VNĐ4,450 on Wednesday, up 4.46 per cent, while HNG share price gained 5.16 per cent to VNĐ11,200.

From December 31, 2020 to January 19, 2021, Hoàng Anh Gia Lai completed the deal to sell nearly 47.5 million HNG shares. — VNS

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