2024 Update
The 2024 annual General Shareholder Meeting of KDH was held on the afternoon of 04/23/2024. Photo: Thuong Ngoc
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Opening the Conference, Chairwoman of the Board of Directors, Ms. Mai Tran Thanh Trang shared, “2023 was a year of many difficulties and challenges, but KDH made exceptional efforts to overcome the obstacles in the market and remained committed to our goal of sustainable development, maintaining a secure financial structure while further solidifying our position as a prestigious and professional real estate brand in the market. By the end of 2023, KDH‘s Privia project in Binh Tan District, consisting of more than 1,000 apartments, was launched and sold out within a short timeframe, becoming a key highlight in the market.
In the year of 2024, KDH plans to offer villa and townhouse projects in Thu Duc City once they meet the requirements to open for sale according to regulations. Simultaneously, we will complete all legal procedures to quickly put the existing industrial park into operation. Furthermore, the Group will continue to cooperate, form joint ventures, and establish partnerships with reputable domestic and international partners with sufficient financial capacity to launch future projects“.
Setting a profit growth target of 10% for 2024
In 2024, KDH aims for revenue of 3,900 billion VND and profit of 790 billion VND, increasing by nearly 87% and more than 10%, respectively, compared to the previous year’s results.
In order to achieve the aforementioned plan, KDH expects to finalize construction, hand over houses, and grant pink books to residents of the Privia apartment project in Binh Tan District, Ho Chi Minh City. Additionally, we plan to develop two projects with areas of 6 hectares and 5.8 hectares, respectively, in collaboration with Keppel Group (Singapore) in Binh Trung Dong Ward, Thu Duc City, which are scheduled to be put into operation by the end of 2024 upon meeting the necessary conditions according to regulations.
Lastly, we will continue to complete compensation and site clearance activities and finalize legal procedures for current projects in Ho Chi Minh City to prepare for plans in the following years.
Plan to issue nearly 91 million shares for 2023 dividend distribution and approximately 11 million ESOP shares
Regarding dividend distribution, the General Meeting of Shareholders approved a 10% stock dividend for the 2023 profit (shareholders holding 100 shares will receive 10 new shares); this rate is expected to remain unchanged in 2024. However, the value and number of shares distributed for the 2023 dividend will vary depending on when the Company closes the private placement of over 110 million shares.
It is reported that in late February – early March 2024, KDH conducted a shareholder vote by written form, and the plan to privately offer more than 110 million shares to 20 professional investors was approved. This is expected to raise 3,000 billion VND. According to the plan, KDH intends to allocate 300 billion VND to pay off bank loans at OCB, while the remaining 2,700 billion VND will be invested in Khang Phuc.
Accordingly, if the issuance of 110 million shares is completed before the final registration date for the 2023 dividend payment, the number of shares issued will be approximately 91 million. Otherwise, the number of shares issued will be only around 80 million.
In addition to issuing shares for dividend distribution to shareholders, KDH also received shareholder approval to issue 10.8 million ESOP shares to employees at a price of VND 17,000 per share, which is 49% lower than the opening price on April 23rd. The shares issued will be subject to a one-year transfer restriction.
With nearly VND 184 billion that could be raised if the issuance is successful, KDH will use all proceeds from the ESOP issuance to supplement its operating capital.
The Board of Directors of KDH has seen a change this year, with the dismissal of Ms. Liu Thi Xuan Lai from her position as a Member of the Supervisory Board. The nominee for Ms. Lai’s replacement is Ms. Le Thi Thuy Trang, born in 1991. According to her resume, Ms. Trang is currently the Head of the Legal Department at Me Ga Urban Development Co., Ltd., and personally owns 10,000 KDH shares, equivalent to 0.0013% of the charter capital.
Discussions:
Private placement of 110 million shares has been filed
KDH’s project development plan?
Chairwoman of the Board of Directors Mai Tran Thanh Trang: For the project under development, The Privia will be handed over this year; the project in Thu Duc will be launched for sale if all conditions are met. As for the project in Binh Tan, after compensation is completed, the company will start the project and commence operations in the following years.
Regarding Le Minh Xuan Industrial Park, the project has been approved in principle by the Prime Minister, and the Ho Chi Minh City People’s Committee has approved the planning. For phase 1 (89 hectares), the Company has paid land rent and is in the process of applying for a construction permit. The remaining 20 hectares are expected to be compensated by 2025.
In addition, for a number of projects that KDH has acquired from the People’s Committee in Thu Duc City and Binh Chanh District, the Company will proceed with the next steps after officially receiving the projects.
Share the status of the two projects in collaboration with Keppel in Thu Duc?
Deputy General Director Nguyen Thuy Duong: The total area of the two projects is nearly 12 hectares. In terms of legal procedures, the joint venture has fully paid the land use fees and has the land use right certificate. The two projects have commenced construction since the fourth quarter, specifically October 2023. Upon completion of construction, the projects will offer approximately 200 townhouses and villas, as well as 600 high-rise apartments. The low-rise townhouses and villas will be launched for sale first by the end of 2024 when all conditions are met, while the high-rise segment will be developed next.
Progress of the private placement of 110 million shares?
General Director Vuong Van Minh: The Company has submitted the application to the State Securities Commission. Upon receiving approval, the Company will execute the plan according to the approved proposal.
Bank interest rates are decreasing, is the private placement of 110 million shares still appropriate?
General Director Vuong Van Minh: Bank lending rates are constantly fluctuating. To ensure financial security and sustainability, the Company considers this issuance to be suitable at the present time.
Confident in repaying bond debt with ample cash flow
Source of funds to repay maturing bonds?
Member of the Board of Directors Nguyen Thi Dieu Phuong: At the end of 2023, KDH had two bond series with face values of 800 and 300 billion VND, respectively, which are private placements for professional investors. These bonds will mature in Q2-Q3/2025, bear an interest rate of 12% per annum, and are unsecured.
KDH is confident in repaying these bonds as it has ample cash on hand, over 3,000 billion VND. Furthermore, in 2024, the Company will hand over apartments belonging to the The Privia project to customers, from which it expects to collect 25% of the remaining contract value in the fourth quarter of 2024.
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