Gelex Annual General Meeting: Expected to provide a synchronous solution for industrial park real estate tenants, revealing a profit of VND 214 billion in Q1

This morning, April 19, Vietnam Electrical Equipment Corporation (Gelex – Ticker Symbol: GEX) held the 2019 Annual General Meeting of Shareholders at Melia Hanoi Hotel.

At 8:30 am, there were 44 shareholders representing 307,569,909 shares, equivalent to 75.65% of the total number of outstanding voting shares of the company attending the meeting. The meeting was qualified to proceed as prescribed.

2018 achieved high growth in both revenue and profit

Gelex just ended 2018 with strong business results over the same period. The year’s revenue reached VND 13,699 billion, up by 14% compared to 2017. And profit after tax reached VND 1,283 billion, of which the profit after tax belonged to the parent company’s shareholders reached VND 942.4 billion, up by 42% over the same period. According to the company’s report, in 2018 the company’s revenue grew in all segments.

Notably, profit after tax rocketed thanks to the recognition of profit from the sale of capital at Kapple Land. However, excluding this sudden profit, Gelex still achieved 34% growth over the same period.

Notably, although both revenue and profit increased over the same period, Gelex had not completed the plan set for the whole year. Explaining this reason, the Group’s Board of Directors said that at the beginning of 2018 when developing the business plan, the company expected to complete the purchase of controlling shares in Dong Anh Electrical Equipment Corporation – JSC. However, the plan had not been completed because the divestment process in this business had not been completed yet.

In terms of revenue structure, revenue from the electrical equipment segment reached VND 11,312 billion, up by 8.6% over the same period and contributed about 82.6% of total revenue. Gross profit from this segment brought in VND 1,595 billion.

Profit before tax plan of VND 1,380 billion in 2019

In 2019, Gelex set a target of consolidated revenue of about VND 16,700 billion and consolidated profit before tax of VND 1,380 billion.

The company’s Board of Directors also said that in 2019 the company had a lot of fiscal places for development. Ninh Thuan Solar Power Project and Canan 1 power plant officially went into operation in April 2019. In addition, the Corporation was also promoting investment in new power generation projects including Gelex 1,2,3 wind power project in Quang Tri, Huong Phung 2 wind power project, Huong Phung 3 wind power project and solar power project in Binh Phuoc, etc.

For the Real Estate segment, in addition to the optimal management and exploitation of existing real estates, Gelex also oriented to further develop the industrial park real estate segment with investment in social housing development, expanded the building materials segment production through increasing ownership in Viglacera Corporation.

Profit before tax of the first quarter was VND 214 billion

At the meeting, answering a question from a shareholder, the Group’s Board of Directors said that in the first quarter of 2019, consolidated revenue reached VND 3,164 billion and profit before tax reached VND 214 billion.

Discussion at the meeting


Gelex’s Annual General Meeting of Shareholders took place excitingly with a lot of interested questions from shareholders.

Ask: What was the cash flow risk in the company’s mergers, M&A and real estate projects in 2019 and in the long term? Currently, the company had a lot of debt, is it high risk?

Answer: Regarding shareholders’ concerns about cash flow, the Group’s Board of Directors said that Gelex converted its operating model to a Holding structure, in which the corporation was in charge of capital management for its subsidiaries, and at the same time conducted mergers and acquisitions (M&A) activities. Therefore, taking a look at the organizational model, cash flow would be rotated, revolved and increased gradually, taken from one activity to compensate for another to gradually improve cash flow strength. Holding’s task was regulating, diverging, and diverging investment to match cash flow.

Ask: Did the company set a business plan for 2019 with revenue and profit a bit cautious?

Answer: In 2019, the company was planning some financial expenses for M&A activities, such as buying controlling shares of Dong Anh Electrical Equipment. Therefore, the company decided to set a cautious business plan and committed to implement it, avoiding a situation like 2018.

Gelex’s Board of Directors also said that the company built 6 factories at its subsidiary Cadivi, increasing capacity by 40%, and focused on high-value, high-quality, high-profitability products, etc. so the company’s business was developing very stably.

Gelex’s Board of Directors also said that in 2018, the company tried to buy a controlling shares in Dong Anh Electrical Equipment but failed. However, to prevent difficult cases, the state decided to divest at high prices, the M&A deal failed, Gelex had bought a controlling shares in a company that is also an electrical equipment company in Dong Anh. This business was also manufacturing transformers that meet Gelex’s requirements for a comprehensive supply of electrical equipment.

Ask: Difficulties in connection at Ninh Thuan solar power plant? What are the company’s plans for this project?

Answer: Currently, Ninh Thuan solar power plant would be put into use from April 2019. And a special feature was that the company signed a contract to cover the entire power output at this plant within the next 20 years, so there was absolutely no need to worry about the output for this project.

Ask: What is the purpose of purchasing Viglacera shares?

Answer: Currently the company held 24.9% shares in Viglacera. And this was a long-term plan, when the company was trying to provide comprehensive and synchronous solution packages for customers to rent industrial parks.

Ask: How would the investment and construction of a hotel project in Tran Nguyen Han proceed?

Answer: The company’s land at Tran Nguyen Han was considered “diamond land”, not just gold land. And the company was oriented to invest in building a 5.6-star luxury hotel in order to retain good land and good assets for the company. However, if necessary, there was still a direction to call for project investment. This project was expected to have a total investment of about VND 120 to 140 million.


At 10:45 a.m., the Supervisory Board announced that one more shareholder attended, bringing the total number of shareholders present to 45, representing 76.15% of the total number of outstanding voting shares.

As a result, the General Meeting of Shareholders approved all the reports sent to the meeting.

Source: http://cafef.vn/dhcd-thuong-nien-gelex-du-kien-cung-cap-giai-phap-dong-bo-cho-khach-thue-bat-dong-san-khu-cong-nghiep-he-lo-quy-1-lai-214-ty-dong-20190419144341043.chn