(VLR) Covid-19 pandemic made the number of bankruptcy enterprises sharply increase, many enterprises set the "freezing" mode to listen out for the situation. Meanwhile, Deo Ca Transport Infrastructure Investment Joint Stock Company has also said that it accepted an after-tax loss of more than VND 26 billion in the first quarter of 2020 to share difficulty with employees during the impact of Covid-19 pandemic when they did not reduce salaries, bonuses and policy regimes, despite the pressure of interest on loans every day.

Deo Ca Transport Infrastructure Investment Joint Stock Company accepts over VND 26 billion in after-tax losses in the first quarter of 2020 to share with employees during the time of the Covid-19 pandemic.

34,900 enterprises closed, dissolved, went bankrupt

The data of assessment and supplementation report of the 1st quarter socio-economic situation and forecast of the remaining period of 2020 of the Minister of Planning and Investment (MPI) Nguyen Chi Dung shows that the complicated developments of Covid-19 epidemic have greatly affected the business community.

“The total additionally registered capital of active enterprises decreased sharply compared to the same period last year showing that the investors and business owners has been greatly affected by the complicated situation of the Covid-19 epidemic. Enterprises are afraid of investing more capital into production and business activities”, the MPI assessed.

Besides, the total registered employees of newly established enterprises in the first quarter was 243,711 employees, 23.3% decrese. The number of enterprises returning to operation was 14,800 enterprises, 1.6% decrease compare to 78.1% in the same period of 2019.

This report also stated that the situation of enterprises withdrawing from the market clearly shows the trend of enterprises now, that is the psychology of considering, waiting, “freezing” or putting enterprises into “hibernation period” to consider the movement of the epidemic, then decide whether to continue the business or close, not completely closing the business at this time.

The above trend is reflected in the sharp increase in the number of enterprises temporarily suspending business and the decrease in the number of enterprises dissolved and waiting for dissolution. In the first quarter, nearly 34,900 enterprises withdrew from the market (rise 2% compared to the same period last year), including: 18,600 enterprises temporarily closed, 26% increase over the same period last year; 12,200 enterprises stopped operating waiting for dissolution procedures, down 20.6%; 4,100 enterprises completed dissolution procedures (down 0.02%).

DII accepted a loss of over VND 26 billion dong

Deo Ca Transport Infrastructure Investment Joint Stock Company (DII - UPCoM: HHV) has just released its Financial Statement Quarter I/2020. The report shows that the negative impact of Covid-19 pandemic which is a common problem to enterprises in 2020.

Specifically, according to the consolidated financial statements for the first quarter of 2020, revenue and other income of Deo Ca Transport Infrastructure Investment Joint Stock Company reached 315 billion VND, while the cost was 341 billion VND, profit after tax is negative VND 26 billion.

DII said that the reason is that in the company's revenue structure, there is 96% of toll revenue from BOT stations. However, from February 2020 until now, the Covid-19 epidemic has appeared in Vietnam and rapidly developed in 200 countries worldwide. In response to a pandemic, the Government and agencies have taken various measures to prevent the disease. With the direction “social distancing” of the Government to prevent the Covid-19 epidemic, the volume of vehicles passing through the toll booths in the first months of 2020 decreased compared to the same period last year. Specifically, in the first quarter of 2020, traffic flow through Deo Ca station decreased by 13%, vehicles through Bac Hai Van station decreased by 6%. Particularly, at National Road 1 toll station of Bac Giang - Lang Son expressway, the vehicle number decreased by 43% compared to the same period last year.

The Covid-19 epidemic had a negative impact on DII's fee revenue, whereby the consolidated revenue in the first quarter of 2020 was lower than expected, only reached about 17% of the year plan, resulting in insufficient cost.

DII's representative stated that, until March 31, 2020, the company's total debt and financial leasing is VND 20,146 billion, of which short-term loan and financial leasing debt is VND 352 billion, increase 2.5 times compared to the beginning of the year. In order to meet the capital needs for business operations expanding, borrowings and long-term financial lease liabilities of VND 19,794 billion, 2% increased compared to the beginning of the year, appropriate with the disbursement and debt collection plan at credit institutions. Although the total debt of the company accounts for a large proportion in the capital but it reflects the common characteristics of enterprises operating in the field of transport infrastructure construction in the form of public-private partnership (PPP).

Also in the first quarter of 2020, the cash flow from bussiness activities of negative VND 492 billion was due to the operation of some new transport infrastructure projects have to face with the impact of Covid-19 epidemic resulting in revenue is not adequately to cover the cost. However, during the operation, the company took the initiative in formulating a plan to make up this deficit with cash-balance and cash-equivalents at the beginning of the period of VND 812 billion. Cash balance and cash equivalents at the end of the period is 398 billion dong.

It is known that Deo Ca Transport Infrastructure Investment Joint Stock Company, formerly known as Hai Van Tunnel Management and Operation Joint Stock Company (HAMADECO), renamed and officially registered for business since July 30, 2019 is a member of Deo Ca Group.

Under the influence of the Covid-19 pandemic, some senior advisors in the system proposed to reduce their remuneration to share the Group's difficulties. However, Mr. Ho Minh Hoang, Chairman of Deo Ca Group, Chairman of Deo Ca Transport Infrastructure Investment Joint Stock Company did not agree, he affirmed: “Despite being negatively affected by Covid-19 epidemic but Deo Ca Group determine not to delay or reduce salary for any employee in the whole system”.

“We are trying to come up with suitable work solutions to ensure income for workers, no one is left behind. We have also demonstrated that determination for nearly 35 years of establishment and development, the Group does not allow employee’s salaries to be delayed or reduced, financial accumulations must always be provisioned to manage corporate risk in recurrent cost, but top priority is for employee’s salary”, Mr. Ho Minh Hoang emphasized.

Although no specific support has been provided for the damage caused by the Covid-19 pandemic, Deo Ca took the initiative to overcome the disease on its own. It is known that, on the occasion of the 30/4 victory and International Day May 1, the company still maintains the bonus for all employees in the system.

Quang Anh