Ricons’ second-quarter net revenue exceeded VND 2,003 billion, a slight 5% decrease compared to the same period last year. This decrease was due to a 9% decline in the Company’s main business segment, which is construction contracting. However, the real estate segment remained a bright spot, contributing VND 97 billion in revenue, nearly seven times higher than the previous year.
Source: Ricons
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As the cost of goods sold decreased more significantly than revenue, Ricons’ gross profit reached VND 96 billion, more than four times higher than the same period last year. This resulted in an improved gross profit margin, increasing from 1% to 5%.
Additionally, financial income surged to nearly VND 113 billion, a 4.2-fold increase compared to the previous year. This was mainly due to late payment interest of nearly VND 106 billion, which was not present in the same period last year.
However, total expenses rose to VND 174 billion, nearly three times higher than the previous year, due to a significant increase in provisions for doubtful accounts, which stood at VND 138 billion, almost eight times higher than the same period last year. This expense increase eroded most of Ricons’ profits.
 Source: Ricons
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Ultimately, the construction company recorded a net profit of over VND 26 billion, a 50% decrease compared to the same period last year. For the first six months of the year, Ricons’ net profit reached nearly VND 41 billion, a 40% decline compared to the first half of 2023.
Source: VietstockFinance
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For the full year 2024, Ricons set a target of VND 7,000 billion in net revenue and VND 60 billion in after-tax profit. In the first six months, the Company achieved 52% and 68% of these targets, respectively.
As of the end of June, Ricons’ total assets amounted to nearly VND 7,518 billion, a 4% decrease from the beginning of the year. Bank deposits accounted for VND 1,100 billion, or 15% of total assets. Short-term receivables exceeded VND 4,600 billion, an 11% increase, with the majority being short-term receivables from customers, totaling VND 4,198 billion. Ricons has made provisions for short-term difficult-to-collect receivables of nearly VND 248 billion, and Coteccons (CTD) remains at nearly VND 323 billion.
Source: Ricons
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Inventory, consisting of construction work-in-progress costs, decreased by 17% to over VND 546 billion. The majority of this inventory is related to the Long Thanh Airport project (VND 82 billion), the SLP Park Xuyen A warehouse project (nearly VND 88 billion), the Eco Central Park Vinh project (approximately VND 81 billion), and the Kim Dung Di Trach project (over VND 67 billion), with the remainder spread across other projects.
Ricons’ total liabilities stood at nearly VND 5,043 billion, a 7% decrease compared to the beginning of the year. Short-term financial borrowings amounted to nearly VND 520 billion, a 15% decrease from the start of the year, representing 10% of the company’s total debt.
Ambitions to Expand in Infrastructure
According to the minutes of the Annual General Meeting of Shareholders held on June 15, 2024, Ricons’ representatives shared that the outlook for work in the latter part of this year and the next is positive, with several large projects likely to be secured in July and August.
Addressing the issue of debt collection, a pressing topic in the construction industry, Ricons asserted that they have multiple strategies and aggressive approaches to debt recovery. In 2024, the company will intensify these efforts, including legal avenues, to ensure effective debt collection.
“We must be resolute in our debt recovery efforts in the coming year (2025) to minimize difficult-to-collect debts for the company”, shared Ricons’ representative.
Furthermore, the construction company also strategizes to participate in key national infrastructure projects. While this is not a new venture, it is a trend that most other construction companies in the market have embarked upon earlier.
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