Coteccons dismisses concerns over executive departure, competition from Vingroup's arm

Vietnam's leading contractor Coteccons (HoSE: CTD) said a recent change in senior management was unrelated to the company's share price performance, as executives highlighted record order backlog and accelerating earnings growth amid a recovery in Vietnam's construction industry.

Speaking at the company's annual Shareholders' Day held virtually on Monday, chairman Bolat Duisenov said the departure of a deputy chief executive officer who also served as chief financial officer was a routine personnel change and should not be viewed as a factor driving the stock's recent weakness.

If the departure of one individual could materially affect a company's share price, that would be a debatable perspective, Bolat told shareholders, adding that the former CFO had voluntarily resigned for personal reasons.

The chairman said Coteccons had built its governance structure to ensure no single individual was indispensable to the company's operations. The company had sufficient resources, systems and talent to continue developing for the next 50 years, he said.

The comments came as some shareholders questioned why the company's stock performance had lagged despite improving financial results and a growing project pipeline.

Bolat said management's focus was on operational execution rather than short-term movements in the share price. If Coteccons focused on controlling the stock price, the company could lose its identity, he added.

Instead, the company remains focused on project execution, financial discipline, and customer relationships, which management believes will ultimately drive long-term shareholder value.

The strategy appears to be yielding results. Coteccons expects revenue for fiscal year 2026, which ends on June 30, to reach approximately VND30 trillion ($1.14 billion), up about 30% from a year earlier. Profit is projected to rise roughly 50%, while net margin is expected to improve to around 4% from 3.4% in fiscal 2025.

The company also reported a record order backlog of nearly VND65.5 trillion ($2.49 billion), providing strong revenue visibility for the coming years. Repeat sales from existing customers remain above 90%.

Questions from shareholders also focused on increasing competition for skilled workers, particularly following the emergence of VinCons, the construction arm established by Vingroup (HoSE: VIC) to serve the conglomerate's growing pipeline of real estate and infrastructure projects.

Deputy CEO Nguyen Chi Thien said Vingroup remains one of Coteccons's largest clients and that work volume from the group continues to expand.

He described the creation of VinCons as a logical move given the scale of Vingroup's development plans, noting that few contractors possess sufficient capacity to execute all projects independently.

Coteccons continues to participate in major Vingroup-related developments, including the PVF Stadium project, where structural works have progressed rapidly since construction began earlier this year.

While acknowledging intensifying competition for engineering and construction talent, Coteccons management said the company remains attractive to employees through competitive compensation packages and a workplace culture focused on flexibility, safety, and professional development.

Regarding real estate business, Bolat ruled out any plans for Coteccons to enter the property investment sector, saying the company would not compete directly with its own customers. "We will always remain a construction company," he said. "Becoming a property developer would contradict our philosophy."

For the third quarter of fiscal 2025-2026, Coteccons reported revenue of VND6.4 trillion ($243.68 million), up 28% from a year earlier. Net profit more than doubled to nearly VND119 billion ($4.52 million), supported by improved project margins and operational efficiency.

CTD shares closed up 0.55% to VND72,700 ($2.76) each on Tuesday.