Loc Troi Group Joint Stock Company (stock code: LTG) has just announced the postponement of its Q2 2024 financial statement due to unforeseen events. Specifically, the management revealed that Loc Troi is facing some unavoidable circumstances, requiring them to focus on stabilizing their production and business capital. All personnel have been engaged in addressing immediate financial matters.
The management of Loc Troi also shared that their 2024 Annual General Meeting of Shareholders was held later than in previous years. Moreover, following this event, the company experienced some personnel changes, including key positions. This has impacted the progress of data compilation and provision for the completion of the Q2 2024 financial statement within the stipulated timeframe.
As a result, Loc Troi’s management wishes for the State Securities Commission of Vietnam (SSC) to approve the postponement of the Q2 2024 financial statement release until August 30th. According to current regulations, public companies must submit their semi-annual financial reports by July 31st.
Regarding personnel matters, Loc Troi Group has relieved Mr. Nguyen Duy Thuan from his duties as CEO since July 15th. Mr. Huynh Van Thon, Chairman of the Board of Directors, is temporarily managing the company’s operations until a new CEO is appointed.
In terms of business performance, Loc Troi achieved a revenue of VND 3,849 billion in the first quarter, a 57% increase compared to the same period in 2023. However, the company incurred a post-tax loss of VND 96 billion in Q1 2024, higher than the loss in the same period last year.
According to Loc Troi’s explanation, to purchase rice and engage in processing and exporting activities, the company had to advance production costs, seeds, etc., to farmers at a 0% interest rate. Meanwhile, the company had to borrow from banks at high-interest rates during a challenging capital market period. This was the main reason for the erosion of profits. Additionally, foreign exchange losses further diminished Loc Troi’s profits.
Apart from business losses, Loc Troi also faced reputational damage due to debts owed to farmers in An Giang and several other provinces in the Mekong Delta, amounting to hundreds of billions of VND. According to a report by the An Giang Department of Agriculture and Rural Development, during the 2023-2024 winter-spring crop, Loc Troi Group signed contracts to consume over 16,070 hectares of rice. As of April 12, 2024, the group still owed money to 928 farmers, totaling nearly VND 246 billion. The deadline for settling all outstanding payments to farmers was committed to be no later than April 26, 2024.
However, as of May 9, 2024, Loc Troi Group still had not paid the farmers more than VND 159 billion.
On May 20, 2024, Loc Troi, in coordination with Tien Phong Bank (TPBank), completed the payment of the remaining rice purchase amount, fulfilling their commitment to the farmers and local authorities.
Loc Troi attributed the delay in payment to difficulties in arranging capital from bank loans, while international customers also delayed their payments. To resolve the issue, the company agreed to sell rice at a lower price to quickly obtain funds to repay debts and expedite negotiations with banks and partners to disburse payments to farmers.
Following these events, LTG stock has been on a steep downward trend. Specifically, at the close of the trading session on August 2, 2024, LTG stock was priced at VND 15,200 per share, a 42% decrease since the beginning of the year and a 31% drop in just one month.
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