According to the minutes of Cadovimex’s AGM (stock code: CAD), Mr. Nguyen Van Chinh, a member of the company’s Board of Directors, also stated that the enterprise is currently in a serious decline in all aspects. The company has gone through many leadership changes but has been unable to revive its business operations due to the accumulation of numerous difficulties from previous years.
WANTING TO DECLARE BANKRUPTCY BUT UNABLE TO DO SO
The leader also stated that Cadovimex has completed the necessary legal procedures to initiate bankruptcy proceedings for the company in accordance with legal regulations. It is understood that at previous meetings, the company had approved the plan to initiate bankruptcy proceedings, but so far, there have been complications due to an ongoing criminal investigation at Cavodimex, which has prevented the court from accepting the application.
Mr. Chinh also shared at the meeting that the structure of the production workshop, which has been in operation for 20 years, is in a state of extreme disrepair due to a lack of proper maintenance and repairs.
The machinery, equipment, and technology are also nearly 20 years old, breaking down frequently, and lacking spare parts for replacement and repair. This has led to low labor productivity, high electricity consumption, and unprofitable processing fees for the company. All of the company’s infrastructure and equipment are mortgaged to the bank for working capital loans from 2009 to the present. Currently, the machinery and infrastructure are in a state of extreme disrepair, with only the outer shell or scrap piles remaining.
In 2023, Cadovimex’s revenue was just under VND 21 billion, while expenses amounted to nearly VND 166 billion, with interest expenses accounting for nearly VND 139 billion. As a result, the company incurred a loss of more than VND 144 billion, bringing its cumulative loss to over VND 1,621 billion.
The enterprise has a total debt of VND 1,383 billion in principal and interest. Six major creditors are banks, with Agribank Ca Mau having the highest debt of VND 129 billion in principal and VND 145 billion in interest as of the end of 2023.
Cadovimex’s management also noted that there are additional amounts owed for social insurance, health insurance, unemployment insurance, occupational accident insurance, and union funds totaling more than VND 26 billion. In addition, the company has uncollectible accounts receivable totaling more than VND 172 billion, with nearly VND 172 billion owed by domestic and foreign customers from before 2017.
Regarding future directions, Mr. Nguyen Trung Chinh stated that the company will continue to lease cold storage, process seafood for existing customers, and seek new clients. They will also call for cooperation from partner companies in processing products and mobilizing finances to upgrade workshops and machinery…
The company will also prioritize salary payments to employees, settle debts with social insurance agencies and other state agencies, and maintain machinery and assets to prevent further deterioration.
CADOVIMEX: FROM A LEADING SEAFOOD ENTERPRISE TO CONTINUOUS LOSSES
Cadovimex was once one of the largest seafood companies (established in 1985) with revenue reaching thousands of billions of VND annually. However, due to various reasons such as difficult-to-recover debts, heavy loan burdens, and challenges in the export market, the company has been in a downward spiral. In 2015, Cadovimex’s revenue decreased from VND 480 billion (in 2014) to VND 196 billion, with a profit after tax of less than VND 0.4 billion.
During the period of 2016-2023, the company incurred continuous losses, and as of the end of last year, the cumulative loss amounted to VND 1,619 billion, with negative equity of VND 1,424 billion.
As of December 31, 2023, the company’s asset size was less than VND 14 billion, including VND 728 million in cash. The company has VND 172 billion in accounts receivable, but this amount has been fully provisioned, mainly from customers South China and Cadovusa.
Regarding the fraud case at Cadovimex, on July 27, the Ministry of Defense’s Criminal Investigation Agency announced that it had issued an indictment and arrest warrant for Mr. Vo Thanh Tien (DOB: 1962, former Chairman and General Director of Cadovimex) for his involvement in the case.
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