3 Creditors Agree to Debt-to-Equity Swap
Sài Gòn Thương Tín Real Estate Joint Stock Company (TTC Land, code SCR – HOSE floor) is a well-known real estate company in Ho Chi Minh City and its neighboring provinces, as well as major cities such as Da Nang, Phu Quoc, Tay Ninh, Dong Nai, and Long An.
TTC Land is one of the real estate companies in the market that diversifies its business model across all three product lines in the real estate industry, including residential, commercial, and real estate services. The company was also ranked among the top 10 most reputable investors in Vietnam in 2018 (Vietnam Report 2018).
On May 22, TTC Land approved the issuance of 34.93 million shares to swap a total of VND 349.3 billion in debt. The shares were issued to swap the existing debts of the creditors and to restructure TTC Land’s finances.
The issuance is expected to take place from 2024 to Q1/2025. The issued shares will be restricted from being transferred within one year from the end of the issuance.
Mr. Dang Hong Anh, Vice Chairman of the Board of Directors of TTC Land.
Three creditors participated in the debt-to-equity swap. Firstly, Thanh Thanh Cong Investment Joint Stock Company will swap VND 289.34 billion for 28.9 million shares. This company is currently a major shareholder of TTC Land, holding 68.8 million shares, equivalent to 17.39% of the charter capital. After the swap, Thanh Thanh Cong Investment Joint Stock Company will increase its ownership to 22.7% of the charter capital.
Regarding the relationship with TTC Land, Mr. Dang Hong Anh, Vice Chairman of the Board of Directors of TTC Land, also serves as a member of the Board of Directors at Thanh Thanh Cong Investment Joint Stock Company.
Thanh Thanh Cong Industrial Zone Joint Stock Company will swap VND 54.29 billion in debt for 5.4 million shares, increasing its ownership from 0% to 1.26% of the charter capital. Thanh Thanh Nam Joint Stock Company will swap VND 5.69 billion in debt for 568,958 shares, raising its ownership from 0% to 0.13% of the charter capital.
How is TTC Land performing?
According to the 2023 Annual Report, TTC Land was established in 2004 with a charter capital of VND 11 billion and 19 employees. In 2010, the company’s shares were officially listed on the stock exchange. As of now, TTC Land has a charter capital of nearly VND 3,957 billion and owner’s equity of over VND 5,125 billion. The company has 23 projects and has launched 15,000 products to the market, delivering them to customers.
Amid the lingering challenges in the real estate industry, the company set its financial and business targets for 2024 with a consolidated net revenue of VND 705 billion and consolidated pre-tax accounting profit of VND 16 billion.
In terms of business results, in Q1/2024, TTC Land recorded revenue of nearly VND 69 billion, a decrease of nearly 15% compared to the same period in 2023. The company’s revenue came from the transfer of real estate, leasing of commercial floors in projects such as TTC Plaza Binh Thanh, TTC Plaza Duc Trong, and Charmington La Pointe, as well as revenue from building management services. Despite the decline in revenue, the company’s gross profit margin increased significantly from 26% to 40%.
In terms of financial revenue, TTC Land recorded over VND 67 billion, a slight increase of 3% over the same period, mainly from dividends from investments of VND 11 billion. Financial expenses were nearly VND 79 billion, up 44%, including loan interest expenses of VND 78.6 billion, up only 3% over the same period, while sales and management expenses decreased to nearly VND 5 billion.
After deducting expenses, TTC Land’s pre-tax profit reached VND 7.09 billion. Thus, by the end of the first quarter of 2024, TTC Land had completed 44.3% of its annual profit plan.
As of March 31, 2024, TTC Land’s total assets were recorded at VND 10,658 billion, not much changed compared to December 31, 2023. The company had inventories of nearly VND 4,017 billion, including VND 2,810 billion in real estate under construction and VND 1,163 billion in real estate goods.
In 2024, the company will focus on sales and research business strategies for key projects such as TTC Plaza Da Nang, Panomax River Villas, and Selavia Phu Quoc. In its strategic orientation and vision toward 2025, TTC Land will expand into the industrial real estate and warehousing real estate sectors in the southern market.
Pha Le
