Downstream major PVOil suffers accumulated loss of $18 mln

Petrovietnam Oil Corporation (PVOil) incurred an accumulated loss of VND436 billion ($18.48 million) and bad debts worth VND867 billion ($36.76 million) as of end-2022.

PVOil was established in 2008 on the merger of Petroleum Trading JSC (Petechim) and PetroVietnam Oil Processing and Distribution Company (PDC).

After acquiring business activities from PetroVietnam Technical Services Corporation (PTSC) in 2009 and capital of Petrovietnam in Petrovietnam Trading and Investment Corporation (Petec) in early 2013, PVOil became the only unit of Petrovietnam to participate in complete downstream development in the fields of crude oil import and export, trading and processing, storage and distribution of oil products.

PVOil's birth marked the completion of the restructuring and consolidation of four Petrovietnam petroleum businesses namely Mekong Petroleum JSC, PDC, Petechim and Petec.

In 2010, PVOil bought the entire petroleum business system of Shell Laos and established PVOil Laos. Later, it acquired capital from State Capital Investment Corporation in eight companies with petroleum business to establish its subsidiaries in Vietnamese provinces.

On January 25, 2018, PVOil successfully held its initial public offering, for VND20,196 ($0.86) per share. With nearly 207 million shares, or 20% of the company's charter capital, and given the initial price of VND13,400 per share, the total offering value of PVOil was more than VND2,770 billion ($117.4 million).

As many as 3,195 domestic and foreign investors registered to buy more than 483 million shares, 2.33 times higher than the offering volume.

Over one month after equitization, on March 7, 2018, PVOil was officially registered on the unlisted public company market UPCoM at the price of VND20,200 ($0.86) per share.

The firm now has 27 subsidiaries with majority stakes, three joint ventures and seven affiliates. It holds the monopoly in exporting crude oil and is the second largest petroleum wholesaler and retailer in Vietnam, behind Petrolimex (coded PLX).

PVOil currently has a charter capital of VND10,342 billion ($438.45 million), with 80.52% of its shares owned by Petrovietnam.

In 2022 alone, PVOil's net revenue reached VND103,729 billion ($4.4 billion), up 79% compared to 2021 and the highest figure ever. Its after-tax profit was VND726 billion ($30.78 million), a decrease of 6%. With the above results, the corporation surpassed its revenue and profit targets by 130% and 182% respectively.

Its return on equity and return on total assets last year were 6.42% and 2.51%, equivalent to those of the giant Petrolimex, at 6.88% and 2.59%, respectively.

PVOil’s total assets as of December 31, 2022 reached VND28,968 billion ($1.23 billion), an increase of 6.5% compared to the beginning of the year, with liabilities of VND17,650 billion ($748.28 million), accounting for 61% of its capital structure.

In the 2013-2022 period, PVOil recorded losses in 2014 and 2020, at VND1,503.6 billion ($70.7 million under the then exchange rate) and VND166 billion ($7 million), respectively.

Notably, it faced bad debts of nearly VND867 billion ($36.76 million) as of December 31, 2022, but the estimated recovery value was only VND28.7 billion ($1.2 million).

In addition, PVOil has maintained accumulated losses for many years, hitting VND436 billion ($18.48 million) by late 2022. However, this was a positive figure compared to the VND3,000 billion recorded at the end of 2014 ($130.2 million under the then exchange rate).