Vincom Retail leaders said Tuesday that the company does not intend to change its name for now and that it will benefit from the extensive operating experience of new shareholders.
Their statement was made in the context of the company no longer being a subsidiary of Vingroup, Vietnam’s largest private conglomerate.
The company’s 2024 Annual General Meeting was a success with all proposals being passed.
Vincom Retail JSC, listed on the HCMC Stock Exchange (HoSE) as VRE, earned revenues exceeding VND9,700 billion ($381 million) in 2023, up 33% year-on-year.
Main earners were: leasing investment real estate and providing related services, VND7,796 billion ($306 million); real estate transfer, VND1,772 billion ($69.6 million); and other sources, VND223 billion ($8.7 million).
Its net profit was VND4,409 billion ($173 million), up 59% year-on-year.
As of December 31, 2023, its assets were valued at VND47,654 billion ($1.87 billion), with the company owning and operating 83 Vincom shopping malls and trade centers nationwide, totaling 1.75 million m2, said VRE general director Pham Thi Thu Hien.
The company expects to generate approximately VND9,500 billion ($373 million) in net revenue, with an after-tax profit of VND4,420 billion ($173 million) in 2024.
It plans to open six new shopping centers, including two Vincom Mega Malls and four Vincom Plazas with a total retail floor area of approximately 171,000 m2, bringing the total number of shopping centers to 89 in 48 out of 63 provinces and cities nationwide by the end of 2024.
Vincom Retail will remove education-related business segments from its registration, the meeting heard.
An item of note approved at the meeting was the removal of Thai Thi Thanh Hai and Le Mai Lan, who resigned as members of the Board of Directors.
Nguyen Hoai Nam was elected as a member of the board of directors for the 2023–2028 term.
Nam, 54, is a Business Administration graduate of the University of Southern California (the U.S.). He began working as a sales director for 3C Corporation in 1992 before becoming TTT Corporation's chief financial officer and Viet Au Investment's managing director. In 2006, he became a director with Berjaya Group, one of Malaysia's leading multi-industry firms.
The election of Nam to the Vincom Retail Board of Directors came after Vingroup signed an agreement on March 17 to sell its entire 100% stake of Sai Dong Urban Development and Investment JSC (SDI). SDI holds more than 99% of the charter capital of Sado Trading Commercial JSC, the main stakeholder who owns 40.5% of Vincom Retail's capital. Thus, Sado and Vincom Retail are no longer Vingroup subsidiaries.
According to SDI's revised business registration, four enterprises in Ho Chi Minh City purchased a total of 55% of the company's shares on April 4. Vingroup and its subsidiaries continue to hold approximately 45% of the remaining shares. Of the figure, Vingroup directly owns 15.7%, while Ngoc Viet Company (a 99% Vingroup-owned firm) owns 29.2%, Vincom Security Services Company Limited and Vinbus each own 0.006% of the company's stock.
SDI's new stakeholders include four newly formed entities: Thien Phuc Business Investment and Development and NP Business and Development each own 16% of the capital, followed by Falcon Business Investment and Development (12.5%) and Emerald Business Investment and Development (10.5%).
The VRE leadership answered several queries at the AGM.
Shopping center opening
Pham Thi Thu Hien, general director of VRE: VRE plans to open six shopping malls this year, four of them scheduled to open in June. In Q1, we concentrated on leasing. Current occupancy rates at stand at more than 60% at new Vincom Plazas and approximately 90% at new Vincom Mega Malls.
Q1/2024 business results
Pham Thi Ngoc Ha, chief financial officer: Q1 saw a 16% increase in revenue as a result of the handover of many shophouses in the Dong Ha Quang Tri project. Its net profit surpassed VND1,084 billion ($42.6 million), up 6% from the same period last year. Q1 revenue and profit meet 20-25% of their respective yearly targets.
Dividends, protection of shareholder rights
Pham Thi Ngoc Ha: The company will retain all accumulated profits until 2023 for business purposes. We currently have a plan for repaying loans. The company also intends to develop an extra 800,000 square meters between 2024 and 2027, necessitating capital. Its future project development will result in sustainable growth; therefore, long-term collaboration with VRE will benefit shareholders.
Shopping mall expansion, new stakeholders
Tran Mai Hoa, vice chairman of the Board of Directors: The Board of Directors' report has detailed VRE's future strategy, as we have been doing for nearly eight years.
VRE's medium- and long-term plan has not changed; nevertheless, its implementation status will be reviewed annually. The overall strategy remains unchanged, forming the company's operational guideline.
In the projects with investments from Vinhomes and Vingroup, the policies will remain the same. Vingroup will continue to be with VRE, and Vincom Retail's shopping mall chain will still go hand in hand with Vingroup's ecosystem, The two sides will have a management contract in the near future to ensure consolidation and development of the industrial apparatus.
Benefits of having new group of strategic shareholders
Tran Mai Hoa: We believe the new shareholders have retail experience and successful store formats. Retailers play a vital role in the success of shopping malls. We believe that Nam's experience and that of the new shareholders will be shared with VRE. They have extensive experience serving on the board of directors, which will be an advantage for us.
Name change, removal of "Vin"prefix
Tran Mai Hoa: Vincom is the first Vietnamese shopping mall brand. Vincom Retail has been with the people for 20 years. The name is a source of pride, and it has worked hard to achieve the system it has now. I believe that many people share this sentiment about a company that has faced ups and downs, hardships, and learnt numerous lessons over the course of 20 years. Vincom brand's retention of the term "Vin" is subject to approval by the future board of directors. If something changes, shareholders will be notified.