Lotus Central JSC has just published its periodic report on its financial situation for 2023. According to the report, in 2023, Lotus Central continued to record a post-tax loss of nearly 670 billion VND. In 2022, the company also lost nearly 480 billion VND. Thus, since Ms. Truong My Lan, Chairwoman of Van Thinh Phat Group Board of Directors, was arrested in October 2022, Lotus Central JSC has lost nearly 1,150 billion VND.
As at December 31, 2023, the owner’s equity reached nearly 5,700 billion VND, which was down by 11% compared to the end of the previous year. Total assets reached nearly 13,700 billion VND. The ratio of debt to owner’s equity was 1.4 times, whereas the debt was more than 7,970 billion VND.
The remaining debt of bonds compared to the owner’s equity was at the level of 0.84 times, which is equivalent to nearly 4,800 billion VND in remaining bond debt.
Lotus Central JSC owns many famous hotels which are located in prime locations.
Lotus Central JSC’s bond is currently in circulation with the code BSECH2126003 with a total value of 4,800 billion VND, issued on October 15, 2021, and due on October 15, 2026. The interest rate is announced at 10.5%/year. Tan Viet Securities Company (TVSI) is the registered depository. However, due to account freezing, the company has been continuously late in paying interest on its bond.
As at December 31, 2023, Lotus Central’s interest payable was more than 150 billion VND, and the late interest from November 1, 2022 to December 31, 2023 was more than 910 billion VND.
Lotus Central JSC’s predecessor was Lotus Company, a member of Saigon Tourist Corporation (Saigontourist). On December 27, 2004, Lotus officially converted into a joint-stock company model with initial charter capital of 130 billion VND.
After more than 19 years of development, the company’s charter capital has increased to about 5,000 billion VND, owning many famous real estates in Ho Chi Minh City and Hanoi. In Saigon, Lotus Central JSC owns Palace Saigon Hotel, Lotus Saigon Hotel, Lotus Annex Hotel, Lemongrass Restaurant, Buffet Gánh Restaurant, Lion Restaurant, Vegetarian Restaurant, Brodard Café, …
In Hanoi, in 2015, Lotus Central JSC spent more than 3,600 billion VND to acquire 51% of Daeha – the business that owns the Daewoo Hanoi Hotel complex and Daeha Office Building (No. 360 Kim Ma, Ngoc Khanh , Ba Đình, Hanoi).
After the incident related to Van Thinh Phat Group, Lotus Central JSC’s business is declining. In the first half of 2023, the company reported a post-tax loss of 230 billion VND, while in the same period it had a profit of 280 billion VND.
In the period 2016 – 2019, Lotus’s net revenue fluctuated from 240 – 290 billion VND. However, in 2016 and 2017, the company reported post-tax losses at 168 billion VND and 137 billion VND, respectively. In 2018 and 2019, Lotus’s net revenue reached 247 billion VND and 243 billion VND, respectively, after-tax profit reached 132 billion VND and 80 billion VND.
Palace Hotel (56-66 Nguyen Hue, District 1) is the property which Lotus Central JSC puts into the bond issuance profile.
In the minutes and resolutions of the 2023 extraordinary general meeting of shareholders, when answering the shareholders’ questions about the relationship between Lotus and Van Thinh Phat, the chairman of the general meeting said that Lotus is currently on the list of 762 companies related to Van Thinh Phat’s bonds announced by the Ministry of Public Security. However, regarding the relationship, the company will inform the shareholders when the Ministry of Public Security has an official conclusion.
Answering the shareholders’ question on why the company asked for a vote on transferring money to an account as regulated by the Ministry of Public Security, the chairman at the general meeting said that Lotus is being asked by the investigating agency to transfer money to that account to remedy the consequences.
Recently, the company had to report statistics on all its revenues and expenditures, operating cash flows for the investigating agency to review. This cash flow includes revenues minus operating expenses, employee salaries, accounts payable, tax obligations to the State… The surplus money must be transferred to the designated account. Therefore, the company still continues to operate normally.
“Regarding whether the company is related to Van Thinh Phat, and how the funds will be handled, Lotus is still waiting for the conclusion of the Ministry of Public Security. The entire cash flow from the issuance of bonds is also in the process of working with the Investigation Agency. The responsibility of the business operator is only implemented within the scope of the decision of the general meeting of shareholders, according to the provisions of the Enterprise Law”, said the representative of Lotus Central JSC.
