Vietnam: EVN reports massive loss in first half of 2016

Vietnam: EVN reports massive loss in first half of 2016

State-run Electricity of Vietnam (EVN) has reported a loss of VND6.371
trillion ($282.9 million) due to foreign exchange fluctuations, making it
suffer an after-tax loss of VND716 billion ($31.8 million) in the first half
of this year, according to newswire Vneconomy.

According to EVN's consolidated financial report, in the first six months of
this year EVN earned VND131 trillion ($5.8 billion) in revenue, up 17 per
cent on-year. However, financial costs increased to VND15.5 trillion
($688.4 million), causing EVN's losses.

According to deputy general director Dinh Quang Tri, the major reason for
the consolidated losses is the foreign exchange fluctuations. Notably, the
group earned VND5.814 trillion ($258.2 million) in profit from business
activities without the VND6.371 trillion ($282.9 million) lost in foreign
exchange fluctuations.

In addition, as of June 30, 2016, EVN had an asset value of VND663 trillion
($29.4 billion) and a consolidated equity capital of VND187.7 trillion ($8.3
billion), while shouldering a debt of VND475 trillion ($21.09 billion).
These large debts put pressure on EVN to pay interest. Notably, in the first
six months of this year, EVN spent VND6.9 trillion ($306.5 million) on
interest payments. The figure was VND12 trillion ($532.97 million) in 2015.

In spite of operating at a loss, EVN has been chosen to take over thermal
power plants Quang Trach I and II, both of which are located in Quang Trach
Power Centre in the central province of Quang Binh.

Notably, EVN will replace Vietnamese oil and gas group PetroVietnam to
develop the long-delayed thermal power plant Quang Trach I.

Regarding Quang Trach II, EVN will replace Russian Inter RAO Group to carry
out a pre-feasibility study to develop this project.

The two projects have a total investment capital of $4.1 billion.

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Link to Original Article:
http://www.vir.com.vn/evn-reports-massive-loss-in-first-half-of-2016.html

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com