Cen Land AMG targets revenue growth of 5 per cent

In 2020, Cen Land aims to increase revenue by 5 per cent, enhance the core values of the leading real estate ecosystem, develop logistics and industrial real estate, etc.

This year, the firm focuses on M&A activities, logistics real estate and expand international markets.

The meeting approved the election of Board member, Chu Huu Chien.

At the AMG on June 12, Cen Land chairman Nguyen Trung Vu (HoSE: CRE), said that by 2020, the firm set the consolidated revenue target of VND 2,441 billion, after-tax profit of VND 400 billion, up 5% and 2% over 2019. The expected dividend in cash is at 10%.

Vu also said that they would continue to develop the ecosystem, taking the real estate brokerage as the core value, researching and developing the logistics real estate to hail the fresh investment wave in the post-pandemic time.

Cen Land sets the consolidated revenue target of VND 2,441 billion, after-tax profit of VND 400 billion. Photo: L.T

In addition, Cen Land takes advantage of the leading brokerage market and favorable market conditions for M&A activities, enhance search performance and invest in quality projects at reasonable costs; upgrade cenhomes.vn proptech platform, launch online real estate valuation; expand international markets, seek investment opportunities in Australia and etc.

Cen Land CEO Chu Huu Chien said that the market in 2020 had an unfavorable start due to the COVID-19 pandemic and the ‘hibernation’ market. Cen Land have conducted many new sales solutions such as online sales event, livestream, etc. Cen Land has overcome the pandemic stage and is ready for acceleration in the coming time.

Regarding the business performance in 2019, the report stated that the company achieved VND2,325 billion in revenue, VND41.2 billion in before-tax profit, respectively 91% and 87% of the previous plan.

In the previous year, the company increased the charter capital from VND500 billion to VND800 billion by issuing shares to pay dividends in 2018.

About the plan to increase its charter capital from VND800 billion to VND1,600 billion at Cen Land AMG 2019, in the unfavorable market, the Board of Directors decided to suspend the plan to issue shares and increase charter capital.

The meeting also approved the election of one more Board member, Chu Huu Chien.

In 2020, Cen Land's strategy is fast development

- Transaction volume of Cen Land this year is only equal to that of the leading brokerage firm in the North, Cen Land has any plan to catch up with competitors?

- Cen Land vice chairman Pham Thanh Hung: There are different reports on successful transaction volume. I do not know the data that shareholders get from; however, according to the report of the Vietnam Association of Realtors and Vietnam Report, Cen Land is the leader in the brokerage market. We don’t mind if we are ranked first or second because sales, secondary investment, commissions, etc are much more important. Commission of over VND1,330 billion in the difficult real estate market reflects the great efforts of the company's management.

- Cen Land chairman Nguyen Trung Vu: The core value of Cen Land is not only brokerage, the transaction volume does not reflect the value of Cen Land, but we focus on sales.

Cen Land always maintains its leadership in the real estate brokerage market with the main sales force, connected agencies, customer care, big data, etc. The nature of sales is 20% of new customers; 80% are royal buyers, traditional ones. Therefore, we always strengthen the sales force and Cen Land has no competitors. In addition, the company select to sell quality with full legal issues and new products to push sales.

- Revenue from the office leasing services is good, about VND20 billion, but why revenue by 2020 is only VND15 billion?

- Cen Land vice chairman Pham Thanh Hung: Office is the most affected business sector in the COVID-19 pandemic. We adjusted the revenue from the office leasing services from VND20 billion to VND15 billion because we expect to reduce the rent. We intend to spend about VND5-10 billion to support small agencies, and free workspaces in Cen X Space within 3 months. These factors reduce revenue from the office leasing services.

- How has Covid-19 affected Cen Land?

- Cen Land chairman Nguyen Trung Vu: As the effects of COVID-19 are felt around the world, real estate companies are being impacted in different ways. However, we determine our strategy is that sometimes we have to go fast, sometimes we go slowly, sometimes we stop. Last year, resort real estate had unclear legal issues and many developers fled for their life, we had to stop. Now, the number of foreigners to Vietnam increase sharply, we will have to go quickly. That is our business philosophy.

We never follow the crowd. I do not like to compare Cen with other firms, either.

- From the outset of this year, what is the transaction volume through Cen Homes? What is the business plan for Ho Chi Minh City in 2020? Does the company continue M&A with Cen Invest?

- Cen Land chairman Nguyen Trung Vu: From the beginning of the year, brokerage transactions through Cen Homes accounts for about 30% and over 1,000 retail transactions. When the app starts running, the retail transactions in Thanh Hoa and Hai Phong are good, especially in Nghe An, Nha Trang, Hanoi, and Ho Chi Minh City.

Transactions through offices of Cen Homes in the provinces reached about VND1,500 billion, while those on the platform double and even triple. We are developing the platform that allows users to set their own home prices, helping sellers avoid the hassle of selling their properties. We are trying to complete the database for this platform in Ho Chi Minh City and Hanoi.

A few days ago, I bought an apartment on 88 Lang Ha at VND32 million/m2, while the previous price was about USD2,100/m2 , i.e about VND45 million/m2. Many new apartments far from the city center that are not handed over are sold for VND50-70 million/m2. Not many sellers know the exact value of their homes. Therefore, I am very concerned about the valuation app.

Regarding questions related to the Ho Chi Minh City market, this year, when the supply in Ho Chi Minh City is scarce, we set the target revenue from the brokerage segment in Ho Chi Minh City to 300 billion, of course as I said, each The payment is very small, I can handle the revenue from this segment for Ho Chi Minh City.

The most important is that in Ho Chi Minh City, Cen currently has 2-3 projects with deposits, purchase orders, the amount of secondary investment is about 450 billion. Thus, the plan in Ho Chi Minh City this year is about VND 800-900 billion. Of course this number is still poor compared to the whole group but we expect gradually the HCMC market will be bigger.

As for M&A, legal papers of projects deployed by Cen Invest are not easy and unforeseen, so I will not answer this issue.

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At the end of the discussion, Cen Land chairman Vu said that after five years, Cen Land agreed to sell real estate products to Vinhomes, promising to make a difference and recruit more and more realtors.