BCG Land reports $5.6 mln net profit despite real estate woes

BCG Land JSC, a Bamboo Capital Group subsidiary, earned an after-tax profit of VND135.6 billion ($5.55 million) in the first three quarters of this year despite several adverse circumstances.

The decline in net profit was 65 % year-on-year (from VND557.65 billion in the same period of 2022) because of an ailing real estate market, narrow credit access and lower-than-expected sales at its Malibu Hoi An and HoiAn d’Or projects, it said.

The firm earned net revenues of VND583.34 billion ($23.8 million) in the nine-month period, down 32% year-on-year, according to its consolidated quarterly financial statement.

In addition to lower revenues, an increase in the cost of goods sold due to a change in its accounting regime resulted in the 65% year-on-year decline in net-profit, the firm said.

It said that the current revenue and profit figures indicated great efforts made amidst a sluggish real estate market.

Between July and September, BCG Land earned an after-tax profit of VND11.71 billion ($478,000) on revenues of VND229.88 billion, down 64.8% and 10.9% year-on-year, respectively.

It has sold 222 condotels and four villas at the Malibu Hoi An project and handed over 56 shophouses at the Hoian d’Or project.

As of the end of September, the firm had total assets of VND12.54 trillion ($511.7 million), up 8.5% against end-2022. Its total liabilities increased 4.8% to VND6.62 trillion ($270.3 million).

With its deleveraging efforts, total liabilities over equity ratio fell to 1.12x as of September, a safety indicator among real estate developers. In addition, its debt to equity ratio declined to 0.54x, suggesting improved risk management.

Notably, cash flows changed from minus VND377.9 billion ($15.4 million) in Q3/2022 to VND617.2 billion as of end-September, thanks to sales at the Malibu Hoi An and Hoian d’Or projects.

The company has received the green light to hold an IPO of 460 million shares under the ticker BCR on the Unlisted Public Company Market (UPCoM) exchange. The IPO date has not been finalized.

BCG Land was established in 2018 with initial charter capital of VND600 billion ($24.5 million). The firm raised its capital base to VND1 trillion ($40.8 million) in 2019, VND2 trillion ($81.6 million) in 2020, and eventually VND4.6 trillion ($187.8 million) in 2022 via a private placement share issuance.

The firm now has two major shareholders namely Bamboo Capital Group with 285.6 million shares or a 62.1% stake, and Transport and Industry Development Investment JSC (Tracodi) with 9.43%.

It now possesses a diverse real estate portfolio that includes high-end projects such as Casa Marina Resort and Casa Marina Premium in Binh Dinh province, Malibu Hoi An and Hoian d’Or in Quang Nam, King Crown Village and King Crown Infinity in Ho Chi Minh City. In addition, it has expanded its footprint to the industrial real estate segment with the Cat Trinh Industrial Park in Binh Dinh.