FECON raises chartered capital to break out

By the end of the first 6 months of 2017, with 28% increase in profit over the same period last year, and the launch of capital increase to accelerate the implementation of the projects, FECON seems to determine to finish the plan early in the second half of 2017 and create a strong momentum for 2018. 28% increase in profit FECON Corporation has announced consolidated financial statement for the Q2 of 2017 with significant growth figures. Specifically, net revenue of FECON reached VND 410.4 billion ($18 mil), up 14% over the same period last year. Selling expenses and administration expenses in the period did not change much compared to the same period last year, but interest expense in Q2 2017 increased 33.7% compared to Q2 2016. In particular, profit from joint ventures and associates in the period showed strong growth, reaching VND 11.04 billion ($484 mil), up 55% over the same period. As a result, FECON's profit before tax was VND 42.51 billion ($1.8 mil) in the Q2; and profit after tax was VND 37.35 billion ($1.6 mil), up 55.6% over the same period of 2016. In the first half of this year, FECON's net profit reached VND 706.07 billion ($31 mil), and after -tax profit of parent company was VND 57 billion ($2 mil), growing by 9.6% and 28% over the same period. This result is far from the 2017 target approved by the General Assembly of Shareholders with a rate of 25% of revenue and 27% of profit plan. According to the plan, FECON's total consolidated revenue is VND 2,800 billion ($123 mil), consolidated profit after tax is VND 200 billion ($8.8 mil). [caption id="attachment_7728" align="aligncenter" width="640"] FECON has been executing TBM Construction in HCMC Metro Line 1[/caption] Raising capital to break out In 2017, FECON has been joining in many big projects in strategic areas such as underground works, infrastructure. FECON has participated in thousands of billion dong worth of contracts related to Hanoi Metro Line 3, Hoa Phat Dung Quat Steel Complex and the Empire City Project in HCMC. In terms of infrastructure investment, in early July, the company signed a strategic partnership agreement with Acwa Power's to become a local partner in research and investment for the solar infrastructure projects in Vietnam. In the FECON financial statement, inventory items have increased by more than VND100 billion compared to the beginning of the year, most of which were recorded as unfinished production and business (VND394.84 billion). If revenue and profit are realized, this number will also contribute significantly to FECON's goal in 2017. According to the resolution of the Board of Management in the Q2 of 2017, FECON is expected to hold an extraordinary general meeting in 2017 to seek comments on raising charter capital. FECON said that the purpose of this charter capital increase is to mobilize funding for the growth of investment activities and infrastructure construction, including transport infrastructure, energy infrastructure, as well as underground and urban drainage and sewer projects, in order to catch up business opportunities, reduce the financial cost of the project to increase profits. It can be seen that the capital increase of FECON has become urgent when the company started implementing a series of projects in recent times and prepared for the "very big" projects in the future.