Vietnam Oil Corporation (PVOIL, stock code OIL) held its 2024 annual general meeting of shareholders (AGM) online on the morning of 26/4/2024, approving a revenue plan of VND 83,000 billion (based on a crude oil price of USD 70/barrel) – a 20% decrease and a post-tax profit of VND 592 billion – a 5% decrease compared to the previous year.
The company has also just announced promising results for the first quarter of 2024, with petroleum sales output reaching nearly 1.4 million m3/tons, an increase of 22% compared to the same period last year. Correspondingly, consolidated revenue reached VND 29,400 billion, an increase of 41% compared to the same period; consolidated profit before tax reached 300 billion VND, an increase of 5% compared to the same period. During the period, PVOIL also developed 33 more petrol stations, bringing the total number of petrol stations in the entire system to 789.
Regarding the 2024 investment plan, the Company plans to invest a total of VND 1,070 billion in capital construction projects, three times more than last year. Of which, VND 459 billion for building new and renovating depots and ports; VND 266 billion to build new and renovate gas stations; VND 345 billion for investment and procurement.
In 2023, PVOIL achieved total consolidated revenue of VND 103,600 billion, completing 207% of the annual plan; consolidated profit before tax reached VND 798 billion, achieving 133% of the annual plan. With the above results, the Company proposes to distribute a 2% cash dividend. Total dividend payout is VND 207 billion.
Discussions at the Annual Meeting
1. Does the company plan to increase its capital?
Chairman Cao Hoai Duong: The current financial situation of the Corporation is sufficient to meet the demand for capital for development and investment, including the development of petrol stations, the retail system, the expansion of petrol depots to meet the logistics requirements for business operations, or cooperation with a number of partners in non-gasoline services. Therefore, PVOIL does not need to increase its capital.
2. When will the company eliminate the auditor’s exception?
Mr. Cao Hoai Duong: In March 2023, the State Securities Commission (SSC) issued a notice announcing that OIL shares were subject to warning because the audited financial statements for 3 consecutive years had 3 exceptions.
This year, the Company has addressed 2/3 of the exceptions and only 1 exception remains, which relates to the investment in PetroVietnam Oil and Bio-fuel Joint Stock Company (PVB). This investment took place a long time ago, before PVOIL was equitized (2018).
The project is currently incomplete, while the Government has not yet provided guidance on the settlement of this investment. PVOIL is working with PVB shareholders to carry out bankruptcy procedures because the project is deemed incapable of further implementation. After completing the bankruptcy procedures, PVOIL will be able to settle this investment, expected within this year or in 2025, PVOIL can eliminate the remaining exception and the Company’s shares will not be subject to warning.
3. Plan and progress of Skypec transfer
General Director Doan Van Nhuom: Up to the present time and before, PVOIL has not received any instructions from the Government, PetroVietnam (PVN) on the transfer of Skypec (Aviation Fuel Single Member Co., Ltd.) to the Corporation.
Mr. Cao Hoai Duong added: If PVOIL has the opportunity to take over Skypec’s business activities, this would be a very good opportunity for the Corporation in the business of jet fuel for customers, who are airlines.
4. What is the progress of handling the malware?
Mr. Doan Van Nhuom: On April 2, PVOIL’s information technology system was subject to a deliberate attack in the form of data encryption (ransomware) that caused the electronic invoice issuance system to stop operating. Therefore, the issuance of electronic invoices for PVOIL’s sales could not be performed.
Immediately, PVOIL coordinated with the Ministry of Public Security, the Ministry of Industry and Trade, the Ministry of Finance, the General Department of Taxation, and cybersecurity experts to resolve the situation. While the incident had not yet been resolved, to ensure the supply of gasoline, PVOIL sold goods using warehouse release and travel orders. At the same time, the Corporation and its member companies worked with relevant authorities to ensure that gasoline transport vehicles could circulate on the road.
5. Is there any price manipulation or suppression of stock prices by floor traders?
Mr. Cao Hoai Duong: In fact, we do not have any information about this, but we will take note of this story. However, PVOIL’s view is to oppose and condemn all acts of unfair price manipulation in the market and to never support such actions.
6. In 2022, 2023, PVOIL achieved impressive growth in revenue and output. Will the company be able to maintain such growth in 2024 and the following years?
Mr. Doan Van Nhuom: In 2022 – 2023, PVOIL increased its output and revenue due to many factors. These include the government’s tight control and transparency in the gasoline market, which has made the market more competitive. Therefore, if the market continues to be fairly competitive, there is no dishonesty on the part of the suppliers, and the economy shows signs of recovery, PVOIL will be able to maintain the above growth rate or even exceed the plan.
However, the growth rate in each phase will be different because the market is like a pie. When some suppliers withdraw from the market, the gap will be filled by PVOIL or other businesses. In the long term, PVOIL will develop and expand its petrol station network to gain a strong market share, while increasing market share through wholesale is not a sustainable way.
7. Expected time for listing on HoSE, what are the criteria that PVOIL has not yet met?
Mr. Le Van Nghia – Member of the Board of Directors: The Company is making efforts to meet 3 conditions for listing shares on HoSE, including:
+ Firstly, the ROE in the most recent year is 5% or higher, and in the 3 consecutive years of 2021, 2022, and 2023, PVOIL has met this requirement.
+ Secondly, eliminate all accumulated losses on the consolidated financial statements. At the end of 2023, the Company still had VND 6 billion in accumulated losses and is expected to eliminate all losses by the end of 2024. Therefore, in the profit distribution proposal, the Company plans to distribute a cash dividend of 2% and the remaining will be used to cover the accumulated losses in order to eliminate the losses.
+ Thirdly, the condition for listing shares on HoSE is that there is no exception on the financial statements related to the Phu Tho Bio-fuel project investment, and we have answered this question above. As Chairman Duong has also clarified, this investment does not affect PVOIL’s business and financial operations in recent years and in the years to come.
8. Will the strong development of electric vehicles affect PVOIL’s business operations?
Mr. Cao Hoai Duong: Electric vehicles in particular and the issue of energy transition in general have been of great interest to PVOIL since 2018. The proof is that we have a quarterly internal newsletter that updates the situation of energy transition, especially the issue of the development of electric vehicles in Vietnam and abroad. PVOIL hires domestic and foreign consultants to adapt to this issue. According to the consulting report, from now until 2030, electric vehicles will not have a very serious impact on the gasoline business in Vietnam, so we are still developing business activities related to gasoline.
However, PVOIL will also take advantage of any opportunities offered by electric vehicles, such as cooperating with VinFast to install electric vehicle charging stations. As of now, we have 322 gas stations with integrated charging stations.
9. Share non-gas
