Phu Quoc Tourism (DPQC) H1 net loss narrows 64% to VND 202B

Overview

Phu Quoc Tourism Investment and Development JSC (DPQC), the operator of Corona Casino and Vinpearl resorts on Phú Quốc Island, reported a net loss of over VND 202 billion for the first half of 2024, a 64% reduction from the same period last year. The company, listed on the Hanoi Stock Exchange (HNX), continues to struggle with accumulated losses nearing VND 6,200 billion.

Key Facts

• DPQC’s H1 net loss was over VND 202 billion, down 64% year-on-year.
• Accumulated undistributed losses reached nearly VND 6,200 billion as of June 30, 2024.
• The company completed a capital increase from VND 7,500 billion to VND 10,000 billion.
• Equity stood at VND 3,807 billion, reflecting the impact of prior losses.
• Total liabilities rose to VND 51,674 billion, up more than VND 10,000 billion from the start of the year.
• Bank loans were VND 311 billion, while outstanding bond debt was VND 7,478 billion.
• DPQC operates seven brands, including Vinpearl Safari, VinOasis, and several Vinpearl resorts, plus the Corona Casino – Vietnam’s first casino allowed to accept domestic players.

What Happened

According to its semi-annual financial report filed with the Hanoi Stock Exchange (HNX), DPQC recorded a net loss of over VND 202 billion in the first six months of 2024, a 64% improvement from the loss in the same period of 2023. The company had already posted losses for two consecutive years, and the latest results bring its average daily loss to more than VND 1 billion.

The report also shows that DPQC increased its charter capital from VND 7,500 billion to VND 10,000 billion during the period. However, due to accumulated losses, shareholders’ equity remains at just VND 3,807 billion. Total liabilities surged to VND 51,674 billion, including VND 311 billion in bank loans and VND 7,478 billion in outstanding bonds.

DPQC was formerly a subsidiary of Vingroup, but the conglomerate divested its entire stake in 2022. The company operates a wide range of tourism assets on Phú Quốc, including Vinpearl Safari, VinOasis, and several Vinpearl resorts, as well as the Corona Casino, which is the first in Vietnam to allow domestic citizens to gamble under a pilot program.

Market Context

DPQC shares trade on the HNX under the ticker DPQC. The company’s financial performance reflects the broader challenges facing Vietnam’s hospitality and gaming sectors, which have been slow to recover from the pandemic. The narrowing loss is a positive sign, but the scale of accumulated losses and high debt levels continue to weigh on the company’s balance sheet. The tourism industry on Phú Quốc has seen increased competition and infrastructure development, which may affect occupancy and gaming revenue.

Strategic Significance

For long-term investors, DPQC’s improving loss trend suggests operational stabilization, but the company remains heavily leveraged with total liabilities exceeding VND 51 trillion. The successful capital increase to VND 10,000 billion provides some financial flexibility, yet the negative equity buffer underscores the need for sustained revenue growth. The Corona Casino’s unique position as a pilot for domestic gaming could be a growth driver if regulations expand, but regulatory and market risks remain. The company’s ongoing development projects, such as the Đồi Mồi and Bãi Vòng complexes, indicate a long-term commitment to Phú Quốc’s tourism potential.

What to Watch

• Q3 2024 financial results to see if the loss reduction trend continues.
• Updates on the pilot program for domestic casino gaming and any regulatory changes.
• Progress on the Đồi Mồi and Bãi Vòng projects, including construction milestones and funding.
• Changes in total debt and bond maturity schedules, particularly the VND 7,478 billion in outstanding bonds.
• Any announcements regarding asset sales or strategic partnerships to reduce leverage.