What Helped TDC Turn a Profit After 6 Consecutive Quarters of Losses?

In a remarkable turnaround, Binh Duong Business and Development Joint Stock Company (HOSE: TDC) has bounced back into profitability in Q2 2024, reporting a net income of over VND 73 billion. This achievement marks a significant shift from the consecutive losses incurred since Q4 2022. The company's resurgence can be attributed to its strategic business collaborations, which have proven to be a pivotal factor in driving this quarter's success.

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While Q2 net revenue decreased by 14% year-on-year to 115 billion VND, financial income surged to nearly 125 billion VND, a remarkable 73-fold increase compared to the same period last year. The significant spike in financial income was primarily driven by a substantial profit from a joint business venture, amounting to over 123 billion VND.

Source: TDC

On the other hand, total expenses amounted to 84 billion VND, a 10% decrease year-on-year. Among these expenses, interest expenses accounted for more than 56 billion VND, reflecting a 13% reduction.

These factors contributed to TDC’s return to profitability after six consecutive quarters of losses (since Q4 2022), with a net profit of over 73 billion VND (compared to a loss of over 281 billion VND in the same period last year).

However, with a loss of more than 23 billion VND in the first quarter, TDC’s net profit for the first six months stood at 50 billion VND (compared to a loss of nearly 322 billion VND in the same period last year). In relation to the 2024 plan, which aims for a total revenue of 2,441 billion VND and a net profit of nearly 408 billion VND, TDC has accomplished 15% and 12% of these targets, respectively.

The positive Q2 results have had a slight impact on TDC’s total assets as of June 30, 2024, which increased by 1% from the beginning of the year to over 3,661 billion VND. Short-term receivables amounted to nearly 399 billion VND, a 22% increase, with a notable receivable being the temporarily divided joint business venture profit of over 165 billion VND from VSIP Hai Phong JSC.

Source: TDC

TDC has entered into a joint business venture with VSIP Hai Phong JSC to invest in the Bac Song Cam Townhouse Project in Thuy Nguyen District, Hai Phong City. The capital contribution and profit-sharing ratio is 50:50, with a total investment of nearly 1,700 billion VND. The project is expected to be completed by the end of 2026.

Inventories stood at nearly 407 billion VND, a 2% increase from the beginning of the year, while work-in-progress expenses decreased by 1% to over 2,110 billion VND.

Source: TDC

TDC has nearly 2,822 billion VND in payables, of which financial debt accounts for 1,550 billion VND, a 2% decrease from the beginning of the year and representing 55% of total debt. The Q2 profit also helped TDC reduce its accumulated loss to nearly 318 billion VND (compared to 367 billion VND at the beginning of the year).

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