Lilama 18 (LM8) Deputy CEO Departs as Q2 Gross Profit Falls 44%

Overview

Lilama 18 (LM8), a HOSE-listed construction and engineering firm, announced the dismissal of Deputy General Director Tran Van Tien effective August 31, 2026, citing personal reasons. The leadership change comes as the company reported a sharp decline in Q2 2026 gross profit, down 44% year-on-year, amid rising financial costs.

Key Facts

• Tran Van Tien, born 1967, has been with Lilama 18 since 1995, marking over 30 years of service.
• The dismissal is effective August 31, 2026, per the company’s announcement.
• Q2 2026 net revenue reached over VND 292 billion, down approximately 5% year-on-year.
• Gross profit fell 44% to about VND 24.6 billion, as cost of goods sold remained nearly flat.
• Financial costs rose nearly 20% to over VND 11 billion, with interest expenses up 33% to VND 10.9 billion.
• Net profit from operations dropped over 85% to VND 3.7 billion in Q2 2026.
• Pre-tax profit for Q2 2026 was nearly VND 3.5 billion, more than 10 times higher than the same period last year, due to a sharp reduction in other losses.
• In H1 2026, net revenue fell 22% to nearly VND 568 billion, and after-tax profit declined about 27% to over VND 4.2 billion.

What Happened

Lilama 18 (LM8) announced the dismissal of Deputy General Director Tran Van Tien, effective August 31, 2026, following his personal request. In his resignation letter, Tien cited the need to handle personal and family matters. Tien, an electromechanical engineer, joined the company in 1995 and had been with Lilama 18 for over three decades.

The announcement coincided with the release of Q2 2026 financial results, which showed a mixed performance. While net revenue declined modestly by 5% year-on-year to over VND 292 billion, gross profit plunged 44% to VND 24.6 billion, as cost of goods sold remained nearly unchanged. Financial costs increased nearly 20%, driven by a 33% rise in interest expenses, and administrative expenses also rose. Consequently, net profit from operations fell by more than 85% to just VND 3.7 billion.

However, pre-tax profit for the quarter surged more than tenfold to nearly VND 3.5 billion, primarily because other losses narrowed dramatically to VND 186 million from nearly VND 25 billion in the same period last year. For the first half of 2026, net revenue declined 22% year-on-year to nearly VND 568 billion, while after-tax profit fell about 27% to over VND 4.2 billion.

Market Context

LM8 shares closed at VND 15,850 on August 14, 2026, hitting the ceiling price despite a sharp decline in the VN-Index. The stock’s positive reaction may reflect investor optimism about the company’s improved pre-tax profit, though the underlying operational weakness and leadership change could temper sentiment. Lilama 18, a member of the state-owned Lilama Corporation, operates in the construction and engineering sector on HOSE.

Strategic Significance

The departure of a long-serving deputy general director signals potential shifts in management strategy at Lilama 18. The company’s core operations are under pressure, as evidenced by declining revenue and gross profit, while reliance on reduced other losses to boost pre-tax profit is not sustainable. Investors should assess whether the management change will lead to operational improvements or further instability. The company’s role within the larger Lilama group may provide some resilience, but the near-term outlook depends on cost control and project execution.

What to Watch

• Q3 2026 earnings release for signs of revenue stabilization and margin recovery.
• Any announcements regarding the appointment of a new deputy general director.
• Updates on the company’s order book and major project wins.
• Changes in financial costs, particularly interest expenses, in upcoming quarters.
• Market reaction to the leadership change and any subsequent strategic shifts.