Bamboo Capital posts 11-fold increase in Q1 after-tax profit

Vietnamese conglomerate Bamboo Capital Group recorded an after-tax profit of VND98.2 billion ($3.85 million) on net revenues of VND985.4 billion ($38.7 million) in Q1/2024.

The figure marked an 11-fold and 40.5% year-on-year increase, respectively, according to the quarterly financial statement of the group, listed on the Ho Chi Minh Stock Exchange (HoSE) as BCG.

Renewable energy business accounted for the biggest portion of revenues with VND320.4 billion ($12.56 million), or 32.5% of the total. Other major sectors were infrastructure-construction with VND222.1 billion (22.5%); real estate with VND209.8 billion (21.3%); and financial services with VND185.7 billion (18.8%).

The renewable energy sector has proved fruitful for BCG after years of heavy investments. Financial services, with the smallest portion of revenue at 18.8%, but an 11% plus year-on-year increase.

It also demonstrates BCG’s balanced business portfolio, with core sectors being renewable energy, infrastructure-construction, real estate and financial services.

The group has attributed the massive growth in post-tax profits to effective control of interest expenses. BCG has proactively paid off debts to reduce financial risks and prepare for future capital mobilization. In particular, its interest expense went down 32.7% year-on-year, equivalent to VND129.4 billion ($5.1 million).

As a result, the debt-to-equity ratio stayed at a safe level of 1.4, equivalent to that at end-2023.

As of March 2024, BCG’s total assets inched up 1.4% year-on-year to VND42,592.1 billion ($1.67 billion). Its liabilities went up 1.5% to VND24,541.6 billion and its owners’ equity rose 1.2% to VND17,467.7 billion.

BCG also noted that its net cash flow from investment was negative VND298 billion as of end-Q1/2024, due to subsidiary BCG Energy acquiring Ho Chi Minh City-based waste treatment firm Tam Sinh Nghia Investment Development JSC, for a waste-to-power project.

Cash flow from business operations, at negative VND432 billion ($17 million), was due to part of the investment in Tam Sinh Nghia Investment Development JSC being transferred to another project partner for waste-to-power technology.

Besides, net cash flow from financial activities was VND62 billion ($2.4 million) in Q1/2024 thanks to a capital hike by AAA Insurance Corporation.

In April 2024, Prime Minister Pham Minh Chinh approved an implementation plan of the country’s power development plan VIII (PDP VIII) for 2021-2030, with vision to 2050. A key target of the plan is to increase the renewable energy portion to 30.9-39.2% in 2030 and 67.5-71.5% in 2050. The plan is not only a major step of the power industry that creates significant growth opportunities for the renewable energy sector.

BCG Energy, under BCG, currently holds a portfolio of 1 GW under the PDP VIII. Notable projects are the 80 MW Dong Thanh 1 and 120 MW Dong Thanh 2 plants in Tra Vinh province; and the 100 MW Khai Long 1 in Ca Mau province.

BCG Energy plans to begin work on these projects this year and put them into operation in 2025. Those projects are set to increase the firm’s generation capacity by 53%.

In February 2024, BCG Energy said it was entering the waste-to-power sector with the acquisition of Ho Chi Minh City-based waste treatment firm Tam Sinh Nghia Investment Development JSC. The 20-hectare factory, with an investment of VND5,000 billion ($205.4 million), will be able to burn 2,000 tons of waste daily to generate 40 MW. In subsequent phases, the factory can expand its daily capacity to 5,200 tons for generating 130 MW. Besides, BCG Energy aims to build waste-to-power plants in the neighboring provinces of Long An and Kien Giang.

It is expected that renewable energy and waste-to-power projects would continue making a major contribution to the performances of BCG and BCG Energy.

According to documents prepared for its April 27 AGM, BCG aims for an after-tax profit of VND951.7 billion ($37.4 million) on revenues of VND6,102.5 billion in 2024, up 556% and 152% year-on-year, repectively.