Vietnam Stock: Petrolimex (PLX) can increase its profit by VND 135 billion, in our opinion except for the first half of the year audit

Vietnam Stock: Petrolimex (PLX) can increase its profit by VND 135 billion, in our opinion except for the first half of the year audit

Regarding business results of Petrolimex (PLX), after reviewing the consolidated profit after tax, it slightly decreased to VND 2,528 billion; Parent company EAT is 1,449 billion dong.

Recognized in the consolidated semi-annual review report of Vietnam Oil and Gas Group (Petrolimex, PLX), the auditor gave an exception except for the provision for devaluation of inventories.

Specifically, on June 30, a subsidiary of Petrolimex established an allowance for inventories of VND 135 billion based on an estimate of the net realizable decrease in inventories. at the end of 2019. This recognition is not in line with Vietnamese accounting standards, in which the allowance for inventories should be made based on the net realizable estimate as at the balance sheet date. End of accounting period (ie June 30).

According to the auditor, if Petrolimex recorded provision for devaluation of inventory in accordance with regulations, as of June 30, provision for devaluation of inventories would decrease, cost of goods sold and profit before tax would increase by 135. billion dong, taxes and other payables to the State and current corporate income tax expense will increase 27 billion dong. Accordingly, undistributed profit after tax and uncontrolled shareholders' benefits will increase by VND 63.72 billion and VND 44.28 billion respectively.

Responding to the above opinion, Petrolimex said that due to the increasing demand of airlines in the last months of the second and third quarter, the subsidiary, Petrolimex Flight Fuel, has imported reserves to ensure the demand. this bridge. However, due to the impact of reducing the purchase volume of a large customer, inventories increased. Meanwhile, the price of oil increased in the first two months of the second quarter of 2019 but decreased at the end of the quarter, the Company forecasts that the downtrend will continue until the end of the year.

Therefore, instead of making allowance according to the net realizable value as at the balance sheet date, the Company has been made based on estimates of the net realizable decrease in inventories. warehouse to the end of 2019 on the principle of caution.

Regarding Petrolimex's business results, after reviewing the consolidated profit after tax, it slightly decreased to VND 2,528 billion; Parent company EAT is 1,449 billion dong.

On the market, PLX shares are gradually recovering from the previous deep decline, currently trading at VND 61,000 / share. Most recently, on August 2, 2019, Petrolimex announced that it had finished selling off 20 million treasury shares, reducing the number of treasury shares to more than 103 million shares.