Exporting rice is the bright spot of Vietnam’s agriculture sector in 2023.

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  • – Vinafood II has just corrected its financial report for the fourth quarter of 2023, in which the outstanding debt of over VND 600 billion receivable from Cuba and payable to the Vietnamese government has not been written off as previously reported.

  • – In fact, this debt does not affect the financial situation of Vinafood II as the company is only an intermediary for payment between the two parties.

Southern Food Corporation – Joint Stock Company (Vinafood II – UPCoM: VSF) has just corrected its financial report for the fourth quarter of 2023 with the company’s total assets “deprecating” nearly VND 2,300 billion, instead of over VND 2,900 billion as previously reported.

The reason for this change is in the item of receivables from Cuba VND 625 billion, and pay the Vietnamese government with an equivalent amount – still not written off the company’s balance sheet.

So by the end of 2023, Vinafood II still has not resolved the long-standing outstanding debt since the 1990s.

In the period 1993 – 1996, when Vinafood II was still a state-owned enterprise, the company acted as an intermediary for Vietnam’s rice aid to Cuba worth USD 25.6 million – equivalent to VND 608 billion in late 2022 – and VND 625 billion in late 2023.

According to the books, this is the amount that Vinafood II has receivable from Cuba, but at the same time, it is also the amount that the company has to pay to the Vietnamese government at the same time.

In fact, this debt does not affect the financial situation of Vinafood II as the company is only an intermediary for payment between the two parties. Normally, if a receivable is not collected for too long, the enterprise must make a provision for bad debts, recording it as management expenses. With this receivable, Vinafood II does not have to make a provision, so it does not affect the company’s business results.

However, once still “hanging” over VND 600 billion receivable/payable, Vinafood II’s indicators of payment ability will be negatively affected.

The financial report of Vinafood II after adjustment does not change the business results compared to the company’s previous report.

As of the end of 2023, Vinafood II still accumulated losses of VND 2,778 billion. This is the result after a long period of losses, since the company was equitized in 2018. Vinafood II has only made a profit in the past two years (2022 – 2023) with a very small profit compared to the charter capital of VND 5,000 billion, or the billion-dollar revenue of the company.

Net profit (billion VND) of Vinafood II from 2018, when the company started equitization


The largest loss of the company in 2018 (nearly VND 1,500 billion) is the result of the financial handling for the previous losses, helping the company equitize and register for trading on UPCoM.

In 2018, Vinafood II provisioned nearly VND 1,300 billion for difficult-to-collect debts from related parties, of which more than half are for handling assets that have been falsified at its subsidiary – Tra Vinh Food Company. The violations at Tra Vinh Food Company have been processed and a court decision has been executed at the beginning of 2023, while the entire inventory shortage (actual inventory compared to the number on the books) has been fully provisioned by Vinafood II since 2018, when the violations were discovered.

From equitization from 2018 to now, despite achieving annual revenue of over VND 16,000 billion, Vinafood II has continuously incurred losses, or obtained thin profit due to the low profit margin, the characteristics of the rice export industry.

Despite the losses, VSF shares of Vinafood II are still trading around VND 38,000/share after shockingly increasing in the past six months from below par value.

VSF shares began to shockingly increase from July 2023 (source: VnDirect)

The company currently has 4 land plots in Ho Chi Minh City, including two land plots with an area of tens of thousands of square meters in District 8 and District 6. The value of these 4 land plots is currently recorded at historical cost, approved since 2017, at VND 561 billion.

The land use value and land use plan may change in the future, when an official opinion is received from the People’s Committee of Ho Chi Minh City – Vinafood II’s financial report stated.

Currently, in addition to the State’s capital contribution of 51.43%, Vinafood II also has a strategic shareholder, T&T Group, owned by Chairman Do Quang Hien (Chairman Hien) with a 25% ownership ratio. Chairman Hien has spent over VND 1,200 billion to become a strategic shareholder of Vinafood II since the company’s IPO in 2018. By now, based on the market price, Chairman Hien’s investment is worth VND 4,750 billion.

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