Construction contractor Coteccons sets record FY2026 targets, capital base hike via share issue

Coteccons Construction JSC (HoSE: CTD), one of Vietnam’s largest construction contractors, has set ambitious targets for its fiscal year 2026, driven by a record order backlog and its push into international markets.

At its AGM on Monday, the company announced revenue and net profit goals of VND30 trillion ($1.14 billion) and VND700 billion ($26.5 million), respectively, for FY2026 (July 2025-June 2026), up 20% and 54% from a year earlier. The profit target marks Coteccons’s strongest earnings since 2020, nearing pre-pandemic levels.

The growth plan is supported by a record order backlog of VND51.6 trillion ($1.96 billion), including VND19.3 trillion ($732.5 million) in new contracts signed during the first quarter of FY2026, the company said.

However, Coteccons faces rising financial pressure. Cash flow from core operations in FY2025 was negative VND1.15 trillion ($43.6 million) due to rapid revenue expansion that slowed collections and boosted inventories.

The company also reported a decline in gross margin, signaling cost-control challenges despite strong project volume.

“Achieving VND30 trillion ($1.14 billion) in revenue within 12 months will not be easy,” said Tran Ngoc Hai, deputy general director. “Our key priority for 2026 is to improve profit margins amid rising input costs, labor fluctuations, and volatile material prices.”

Coteccons said it holds about VND1.15 trillion ($45.5 million) in bad debt provisions and does not plan further provisioning this year. The board also approved a 10% cash dividend for FY2024-2025, equal to VND1,000 ($0.04) per share or about VND101.4 billion ($3.85 million) in total payouts.

The company will issue 5.3 million bonus shares at a 20:1 ratio, raising its charter capital to VND1.14 trillion ($43.2 million), and allocate 1.1 million treasury shares for an ESOP program at VND10,000 ($0.38) per share.

International expansion remains a strategic priority. CEO Bolat Duisenov said Coteccons has established a legal entity in Saudi Arabia after 18 months and is now bidding for projects there, while its Taiwan licensing process took 15 months. The company is targeting three overseas markets — the U.S., the Middle East, and Taiwan.

Coteccons recently completed a VinFast-invested project in India, where its engineers oversaw more than 1,000 local workers, and is currently executing three projects in Taiwan: Taipei Twin Towers, Hsinchu Complex, and Taipei University.

CTD shares ended down 5.39% to VND79,000 ($3) each on Monday.