PVMachino: Profit increased thanks to provision reversal
Only in the fourth quarter of 2020, the profit of PetroVietnam Machinery and Equipment Joint Stock Company, PVMachino, reached over 14.7 billion dong, leading to a year-over-year profit increase of 56.4 billion dong thanks to the reversal of provisions.
Reasons for the decline in revenue
Petroleum Machinery and Equipment Joint Stock Company has just issued an announcement to announce the company’s financial report in the fourth quarter of 2020. Accordingly, at this time, PVMachino achieved revenue of more than 30 billion VND, but it decreased by 60% compared to the fourth quarter of 2019.
But profit after tax reached VND 14.7 billion, double that of the fourth quarter of 2019. In the whole year of 2020, PV Machino achieved a revenue of 209.4 billion dong, only a quarter of 2019’s revenue, but profit after tax reached 56.4 billion dong, up 21% compared to 2019.
Explaining why revenue decreased but tax profit increased, PVMachino‘s management said: The main reason for the decrease in revenue is the impact of the covid 19 epidemic during this time, causing commercial activities to be suspended. suspend operation. However, the increase in profit was due to the fact that during this period the company recovered bad debts and reversed provisions, leading to sudden profits.
According to the survey financial report, the provision for bad debts has decreased by 5.2 billion VND compared to the beginning of 2020, the dividend and profit divided in 2020 is 83.6 billion VND. VND, a slight increase compared to VND 81.3 billion in 2019.
Advantages of PVMachino
PVMachino has the great advantage of joint venture capital with the following companies:
- FCC Vietnam Co., Ltd. with a capital of 10%,
- Vietnam Nippon Seiki Co., Ltd. 10%
- Hitachi Astemo Hanoi Co., Ltd. 8.45% (with a total book value of only 98 billion VND).
The operation of the 3 joint ventures is very effective, bringing PV Machino a regular cash dividend income of about VND 80-100 billion every year.
On the other hand, the joint venture partners of the company are mostly leading Japanese enterprises in the field of machinery manufacturing such as FCC, Asia Honda Motor, Nippon Seiki, Itochu Corporation…
Furthermore PVMachino is a manufacturer specializing in auto parts, motorcycles, specialized vehicles and other machines: BMW, Honda, Harley Davidson….
With the goal of constantly developing and trying, the company’s team PVMachino always strives to find great cooperation opportunities in domestic and international markets.
Moreover, PVMachino also owns a golden land when managing and using many large real estates such as: land lot of 1,827.69 m2 at 8 Trang Thi (Hanoi); plot of land 23,600 m2 at Dao Cam Moc street (Dong Anh, Hanoi); land plot 44-2 at No. 5, cluster 4, Khuong Dinh ward (Thanh Xuan, Hanoi).
In addition, PV Machino also owns 10% of capital contribution in the project “High-class apartment complex, mixed services – Nam An Khanh urban area” belonging to lot HH3 of Nam An Khanh project, Hoai Duc district (Hanoi). This is an apartment complex that is evaluated by investors as promising in 2022.
PV Machino not only owns a lot of golden land, joint ventures with many big companies, but PV Machino also has many subsidiaries and affiliates in all regions such as Saigon, Da Nang, which are hidden with great potential.
For example, Da Nang Petroleum Machinery Joint Stock Company (Daesco) is a very large agent of Mitsubishi automobile company in Vietnam.
In 2019, Daesco achieved revenue of VND 806 billion, equivalent to a car sales volume of 1,356 vehicles. Daesco is currently managing and using many land plots in Da Nang such as 218.8m2 at 53 Tran Phu; 1806.8 m2 at 51 Phan Dang Luu, now as a car showroom (term of 50 years)…
Daesco is also leased land by the State with a term of 50 years from 2016 in Southeast Thuy An New Urban Area (Thua Thien Hue) to invest in the construction of Mitsubishi Daesco Hue.
Notably, recently parent company PV Power announced the decision of the Board of Directors dated January 8, 2021 approving the plan to restructure PV Power, which plans to divest all capital in 8 units including: including PVMachino.
Thus, if anyone buys the capital from PV Power to sell, they will have control over PV Machino’s operations. This is causing a stir and is a matter of great public interest, especially investors.
The heat of the divestment deal
The story of divestment in PVMachino has affected many investors and shareholders of PVPower since the company’s IPO and during shareholder meetings.
At the recent Extraordinary General Meeting of Shareholders of the parent company PV Power in 2020, many shareholders in the company asked questions related to the plan to divest capital, match orders or conduct auctions.
At the same time, how are the joint venture capital assets and real estate of PVMachino and businesses in the PVMachino ecosystem valued?
However, in order to answer the above questions, PV Power’s Chairman – Mr. Ho Cong Ky said that he will conduct divestment at PVMachino in a transparent and public manner and will absorb the research ideas raised by shareholders.
Moreover, the company will organize a roadshow to introduce PVMachino investment opportunities so that interested investors can easily access investment opportunities and research the potential of this business.
Thus, we can see that thanks to the heat of the divestment deal and the profit from provision reversal, PVMachino‘s revenue has been increasing day by day.