At a recent leadership meeting, Hoa Binh Construction Group (HBC) stated its intention to concentrate resources on resolving outstanding financial obligations. The company will prioritize debt recovery and settling tax and social insurance debts this year. This initiative is a key focus of its restructuring efforts, following a period where the construction and real estate markets declined, putting pressure on project availability, cash flow, and accounts receivable.

Currently, HBC has tax debts totaling approximately 41,6 billion VND, with 39,2 billion VND overdue by over 90 days. The company also faces social insurance obligations and numerous long-standing receivables from previous years. According to data from the Social Insurance of Ho Chi Minh City, the company owes nearly 60 billion VND.

To secure sufficient resources, Hoa Binh is accelerating its debt recovery process. The company has multiple accounts receivable that have gone through various judicial levels and are awaiting enforcement. This recovery is expected to enhance the company's cash flow and provide the necessary funds to meet its remaining financial commitments.

During the annual general meeting at the end of June, the company's leadership reported that total outstanding receivables currently stand at approximately 2,300 billion VND. The goal for 2026 is to recover a minimum of 1,200 billion VND in cash.

'Hoa Binh is prioritizing the resolution of all issues related to financial obligations and will complete this within the year. Development must align with responsibility, and recovery must begin by addressing outstanding issues,' said Le Viet Hieu, Permanent Deputy General Director.

Workers at the Eco Retreat project construction site. *Photo: HBC*.

Concurrently with focusing on debt resolution, Hoa Binh's business operations show signs of recovery. For the first six months of the year, the company's revenue reached approximately 3,269 billion VND, nearly doubling compared to the same period last year. Gross profit stood at 278 billion VND, a significant increase from 117 billion VND in the first half of the previous year. However, Hoa Binh's after-tax profit was approximately 41,6 billion VND, a 19% decrease, indicating that improved revenue has not yet efficiently translated into profit.

This year, Hoa Binh aims for 10,000 billion VND in revenue and 250 billion VND in after-tax profit. The company anticipates continued improvement in project availability with several large-scale projects in housing, urban development, resorts, and industrial sectors.

Earlier this year, Hoa Binh broke ground on a 3,000 billion VND package at Eco Retreat as the general contractor. Subsequently, the company began work on several other projects, including Whisky Hotel, Galia Ha Noi, and various structures within Phu Thuan Residential Area.

According to the leadership, the recovery of project work must be coupled with rigorous control over costs, cash flow, and financial obligations. The company aims not only to increase revenue but also to resolve persistent outstanding issues to enhance its financial health.

As of the end of June, HBC recorded total loans and financial lease debt of approximately 4,062 billion VND. This represents a decrease of nearly 82 billion VND compared to the same period last year.

Tat Dat