Construction giant Hoa Binh placed under control over late financial statement submission

The Ho Chi Minh Stock Exchange (HoSE) has decided to put HBC shares of Vietnam’s leading construction firm Hoa Binh "under control" from April 17, due to its late submission of audited annual financial statements for two consecutive years.

Hoa Binh recently sent a document to the State Securities Commission (SSC) and the HoSE applying for an extension for its audited financial statements in 2022.

According to Ministry of Finance regulations, the deadline for publishing the company's audited 2022 financial statements was March 30, 2023. However, a series of projects across the country that Hoa Binh involves as construction contractor have stalled due to real estate market difficulties. Many of Hoa Binh's main customers struggled with cash flow problems, being unable to carry out construction or make timely payments to the group.

In that context, Hoa Binh's auditing unit needs more time to carry out procedures and collect more documents to be able to complete Hoa Binh's 2022 financial statements, the firm said.

In addition, from the end of 2022 to the beginning of 2023, Hoa Binh recorded several changes in senior personnel, as well as conflicts among board members, causing delays to the completion of financial statements and information disclosure.

Hoa Binh has expressed its wish for the stock market watchdog to consider extending the deadline for its 2022 financial statements until May 12 at the latest.

In 2023, Hoa Binh is targeting revenue of VND12.5 trillion ($533 million) and pre-tax profit of VND125 billion ($5.32 million).

Hoa Binh Construction Group, a leading construction contractor in Vietnam, reported net revenue of VND14.12 trillion ($598.83 million) in 2022, up 24% year-on-year and fulfilling 80% of its target, according to the company's consolidated financial statement.

It suffered a net loss of over VND1.14 trillion ($48.34 million) in 2022, the first loss in its history, due to bad results in the fourth quarter.

HBC shares stood at VND8,180 ($0.35) on Wednesday's morning session.