In its report to the Hanoi Stock Exchange (HNX), HPX stated that the real estate market has faced challenges due to tightened credit and reduced liquidity for the industry, impacting the company’s cash flow from projects.
Specifically, the developer of Hai Phat Plaza owes interest payments for two installments of the HPX122018 bond, totaling over VND 33 billion. This bond, issued at the end of 2018, has a face value of VND 300 billion, a coupon rate of 10.5%, and was expected to mature at the end of this year. It is a non-convertible, non-warrant-attached bond backed by assets.
Meanwhile, the VND 500 billion bond with the code HPXH2125007, which pays interest four times a year, has seen HPX make full payment for the first installment and partial payment for the second, with over VND 41 billion remaining unpaid. The funds, raised in 2021 from a securities company to increase the scale of operations, will mature in August 2025. The initial interest rate was 11% per annum.
The bond is secured by the right to use land, ownership of houses, and other assets attached to the land for five commercial kiosks and eight commercial floors in the HH building of the Hai Phat Plaza project in Nam Tu Liem district, Hanoi. It is also backed by the right to use land, ownership of houses, and other assets attached to the land with an area of 1.4 hectares in Tuy Hoa city, Phu Yen province.
Hai Phat Plaza, a mixed-use complex of commerce, services, and luxury apartments in Hanoi. Source: HPX
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At the end of 2023, HPX had nearly VND 1,500 billion in outstanding bonds from five issues with a total value of nearly VND 2,000 billion. Last year, the company spent about VND 1,000 billion to repay principal amounts, fully settling the HPXH2123004, HPXH2123011, and HPXH2224001 bond issues.
The HPXH2124001 bond issue, worth VND 650 billion and raised in May 2021, had its term adjusted by the bondholders from 36 months to 42 months, maturing in November this year. According to the latest update from HNX, the company has fulfilled its obligations to bondholders, reducing the outstanding debt from VND 195 billion to zero. The term of the HPXH2123008 bond was also extended from 24 months to 36 months last year.
HPX performed well in the first quarter of 2024, with a net profit of nearly VND 17 billion, compared to a loss of VND 28 billion in the same period last year. Revenue almost doubled, reaching nearly VND 324 billion. Real estate business revenue accounted for over VND 285 billion, nearly two and a half times higher than in the first quarter of last year, due to more product deliveries to buyers.
While the company did not disclose revenue by project, the explanation notes no longer recognized construction-in-progress costs for the HP Plaza project, which was booked at over VND 17 billion at the beginning of the year.
This year, HPX plans to increase its charter capital to gain resources and cash flow for production and business activities, as well as focus on restructuring and servicing its bond packages maturing this year. The company also aims to repurchase bonds before maturity and repay debts to credit institutions in the fourth quarter of 2024.
As of the end of the first quarter of 2024, the company’s short-term and long-term debt amounted to nearly VND 2,400 billion, or about 27% of total assets. If the plan is followed, HPX will need about VND 800 billion to settle the bond issues maturing in 2024, with only the HPXH2125007 issue remaining.
Recently, HPX was fined VND 65 million by the State Securities Commission’s Inspection and Examination Department for late disclosure of information, along with multiple administrative violations.
| HPX’s quarterly financial results from 2018 to the present |
Recognizing revenue from project transfers, Hai Phat turns loss into profit in Q1
