Novaland’s audited consolidated revenue stood at approximately VND 3.7 trillion, encompassing sales, service provisions, and financial activities. Sales revenue neared VND 1.9 trillion, marking a 37% year-on-year increase, derived from project handovers such as NovaWorld Phan Thiet, NovaWorld Ho Tram, Aqua City, and Palm City. Service revenue reached VND 393 billion.
Novaland posted a loss of over VND 7.2 trillion for the first half of 2024, reversing from a profit of VND 345 billion in the previously self-prepared report.
The company attributed this primarily to a provision for land rental and land use fees payable, calculated based on the 2017 land price scheme for the 30.11-ha project in Nam Rach Chiec, An Phu Ward, Thu Duc City, Ho Chi Minh City (Lakeview City project – developed by Century 21 International Development Joint Stock Company), as per the tax authority’s notification on January 8, 2021. The provision established for this payable amounts to VND 4.4 trillion.
Notably, Lakeview City is a project that Novaland exchanged for a 30.22-ha project in Binh Khanh Ward, Thu Duc City – a project for which the company had completed site clearance and compensation in 2008, following a land allocation decision in 2004. In 2016, the People’s Committee of Ho Chi Minh City issued a decision approving the land price scheme at market prices for both the 30.22-ha site in Binh Khanh Ward and the Lakeview City project, resolving the exchange for Novaland with the same valuation timeframe of 2008 for both projects.
Consequently, after determining the land-use rights value and the location differential between the two sites, the company was required to pay an additional amount of nearly VND 53 billion post-project exchange. Novaland recognized this financial obligation in its accounting books in 2016.
However, on December 29, 2020, the People’s Committee of Ho Chi Minh City issued a decision approving the land price scheme for the 30-ha site in Nam Rach Chiec, An Phu Ward, District 2 (now Thu Duc City) with a land price scheme as of April 2017 (instead of 2008 as mentioned above). Accordingly, the Ho Chi Minh City Tax Department issued notifications for land rental and land use fee payments totaling nearly VND 5.2 trillion. Novaland disagreed with determining the land-use fee calculation timeframe as April 2017, as they had completed compensation in 2008.
At the same time, according to regulations, when the State revokes land, it must compensate with equivalent land; if land is unavailable, compensation shall be made in cash. “Novaland believes there are sufficient grounds to ascertain that the land price exchange timeframe for the Lakeview City project is 2008. Currently, Novaland is continuing to petition the People’s Committee of Ho Chi Minh City and related departments to consider a thorough resolution for the company,” Novaland stated in its announcement.
As of the issuance date of the reviewed financial statements, the Ho Chi Minh City Tax Department and Thu Duc City Tax Department had issued decisions to revoke the enforcement of administrative decisions on tax management, pending the outcome of the resolution on land use fees and land rental by the competent authority, based on the Ho Chi Minh City People’s Committee’s document.
Additionally, Novaland explained that, according to the independent auditor’s perspective, they adjusted the reduction of financial revenue from lending activities, joint ventures, and other income from contract violation penalties incurred during the period, as they had not been collected in cash as of June 30, 2024. As of the report issuance date (September 26, 2024), all these amounts had been recovered in cash. Therefore, these revenues will be recognized again in the 2024 financial statements.
In the semi-annual financial statements, the independent auditor also expressed an opinion regarding the Group’s assumption of continuing operations. Regarding this, Novaland stated that it would continue to implement various solutions to generate sufficient cash flow to finance its operations.
“The company is accelerating the implementation of key projects, alongside investing in diverse utilities and organizing numerous programs to enhance the value of destinations. The Group is in the process of financial restructuring, gradually restoring business activities, rebuilding investor confidence, and fulfilling commitments to customers,” Novaland informed.
 NovaWorld Phan Thiet Project
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