Annual General Meeting of DQC: 27th April
The annual general meeting of the shareholders of DQC on the morning of 27th April
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Mr. Ho Quynh Hung – Chairman of the Board of Directors of the Company said that the most difficult thing this year is to guess the direction of the market, even the US market, which previously saw talks of interest rate cuts, but has not yet been reduced. Geopolitical issues, Russia – Ukraine have not stopped, followed by the Middle East war. Exports are also affected by the Middle East war, the problems in the Red Sea are affecting shipping costs.
In 2024, DQC sets a target of VND 1,000 billion in consolidated net revenue, an increase of 16% compared to the previous year. Consolidated pre-tax profit is VND 20 billion. Dividends are expected to be 5%.
Chairman Hung pointed out two groups of opportunities that DQC is interested in, the first group is the energy sector, aiming to provide solar power for people, but currently the policy is not clear, and we need to wait and see.
The second group, from the supporting industry and export group, does ODM and electronic circuit boards. This year, we have received two orders for electronic boards and simple equipment for the medical sector.
In addition, another group of opportunities is to implement public investment projects, when the economy is difficult, the State will increase public investment. However, the Chairman also expressed that it is not possible to say much about this group of opportunities. There are many issues such as complicated procedures and continuous delays; for example, two projects won by DQC in Da Nang, because many were still delayed from last year to the present.
In Q1, DQC had consolidated revenue of approximately VND 168 billion, equivalent to 82% of the same period, a decrease of 18%. Regarding profit, DQC breakeven in Q1, specific figures will be disclosed later.
The reason why the Company breakeven while revenue was low is because it has gradually cut costs since last year, when the business situation was not favorable.
Looking back at the business results of 2023, Dien Quang Group failed to meet the set targets. Consolidated net revenue recorded VND 859 billion, equal to 72% of the plan. Consolidated pre-tax loss was nearly VND 31 billion.
Chairman Hung also explained that the reason for the loss in 2023 was due to many factors. Of which, the biggest impact was due to the decrease in revenue, which was lower than the target set. Sales and interest expenses increased last year, the Company has increased promotion programs to maintain market share. Last year’s financial market was also very poor, real estate companies had difficulties, and DQC shared risks with customers, accepting to pile up debts and extend debts to agents.
In addition, DQC also had to set aside risk provisions as prescribed for investments when stock prices declined, such as Vinatex (Vietnam Textile Group). Subsidiaries also hold shares of the parent company, so when consolidated, they are also affected.
Last year, DQC also won the bid for the lighting solution of Phnom Penh International Airport (Cambodia) in the context of the domestic real estate market being poor. “Last year, we started to provide lighting solutions abroad, bidding for Phnom Penh International Airport, which previously only exported products”, said Chairman of DQC.
Mr. Hung emphasized that this is a very large project, although only winning a part of it, but it is the most important part of the lighting. Currently, based on the winning of this bid with the investor, it will continue to work to reach other works of the airport.
The General Meeting of Shareholders approved the non-distribution of dividends in 2023 and retained the undistributed profit at the end of 2023 to be decided next year. In the event that at any point during the year, the business situation has positive changes, the Board of Directors will have a plan and submit it to Shareholders in writing on the distribution of dividends and issuance of bonus shares (if any).
Source: Annual General Meeting 2024 documents of DQC
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The above non-distribution of dividends is based on the assessment of the global and Vietnamese economic situation in general, which will be very difficult and challenging, especially the real estate market; the unclear credit and interest rate situation has created pressure on capital sources for implementing production and business plans. At the same time, to ensure capital for production and business activities of the Company’s new business lines such as ODM and ancillary industries, lighting of industrial and infrastructure works, art lighting that is not affected by the real estate market.
