State-controlled machinery firm VEAM announces highest dividend payout in 4 years, stock listing still on hold

Vietnam Engine and Agricultural Machinery Corporation (VEAM) plans to pay more than VND6.96 trillion ($264.46 million) in dividends for 2025 at a payout ratio of 52.4%, its record high in four years, while its long-delayed stock exchange listing remains on hold due to unresolved legacy issues.

The dividend plan was approved by shareholders at the company’s 2026 annual general meeting of shareholders (AGM) on Monday.

The payout is based on the parent company's 2025 after-tax profit of more than VND7 trillion ($265.98 million), up 12% from 2024. Contributions from joint ventures and associates accounted for VND6.63 trillion of the total profit. After the dividend payment, VEAM will retain nearly VND2.58 trillion ($97.99 million) in undistributed earnings.

For 2026, VEAM targets parent-company net revenue of VND7.66 trillion ($290.91 million) and after-tax profit of VND6.31 trillion ($239.84 million), down 5% and 10% year-on-year, respectively.

On a consolidated basis, the company aims to generate VND4.89 trillion ($185.77 million) in net revenue from sales and services, up 10% from 2025, but has not provided a profit target.

VEAM's leadership described 2026 as a pivotal year in its 2026-2030 development strategy. The company plans to strengthen its core businesses in agricultural machinery, automobiles, and auto parts, while accelerating restructuring efforts through divestments from underperforming and non-core subsidiaries.

It also intends to work with Toyota to expand manufacturing capacity and broaden its product portfolio through estimated investments of about $260 million between 2026 and 2029, financed by retained earnings.

The leadership reaffirmed that earnings from its three major associates - Honda, Toyota, and Ford - remain the company's primary profit driver. All three are pursuing hybrid and environmentally friendly vehicle strategies to align with Vietnam’s transition toward a low-carbon economy.

In addition, VEAM is exploring a strategic partnership with a major Chinese automaker to develop the VEAM Auto plant in Thanh Hoa province. The project will focus on electric passenger vehicles, electric trucks, and vehicles serving construction and industrial sectors, with potential expansion into mining equipment and other specialized vehicle segments.

Stock listing remains pending

VEAM's shares have traded on the Unlisted Public Companies Market (UPCoM) as VEA since 2018, and a formal stock exchange listing continues to attract strong interest from shareholders.

At this year's AGM, the board proposed continuing efforts to list the company's shares on a stock exchange. However, the process remains stalled because VEAM's financial statements continue to receive qualified audit opinions.

Chairman Ngo Khai Hoan said the audit qualifications are unrelated to the company's current operations and instead stem from longstanding issues dating back to the period before VEAM's equitization.

These include unresolved matters related to equitization settlement, financial restructuring, state capital management and settlement, and historical documentation and procedures.

Resolving these legacy issues remains challenging because the process involves not only VEAM but also multiple government agencies, regulatory requirements, and reviews by relevant authorities.

In its 2026-2030 development plan, VEAM identified the resolution of historical issues, completion of restructuring, and finalization of equitization-related matters as key priorities.

VEA shares closed Tuesday at VND34,700 ($1.32) apiece.