Biwase profits USD 8 million on effective loans

After the COVID-19 pandemic, many businesses struggled to restore production and business activities. However, in Binh Duong, in the first 5 months of 2022, Binh Duong Water Environment Joint Stock Company (Biwase) made a profit of USD 8 million thanks to using loan capital as committed to the investment  and expansion of the water supply network to people and businesses.

Last May, Biwase received a USD 25 million loan from DEG of Federal Republic of Germany. This is the second time Biwase has been approved for a loan by creditors without having to go through any government guarantee.

Production expanded to catch the investment inflows

In 2020, when the COVID-19 epidemic occurred globally, the supplying chain for manufacturing industries was affected mainly by the limited travel conditions, customs clearance of import and export goods from countries where the measures to prevent and control the COVID-19 epidemic had been firm. When the economic picture was not very bright, businesses and investors chose business solutions of safe production without expansion to make large investments in operations due to many objective reasons including the influence of the pandemic.

Talking to us, Mr. Tran Chien Cong, General Director of Biwase, said that while many businesses were almost clustered to moderate production during the period of COVID-19 pandemic and the sales was humble, Biwase chose a path on its own, irrespective of unexpected increased consumption that prompted businesses to choose a safe production and business solution, to effectively adapt, especially being ready to speed up when the epidemic was over. It is an investment ahead to catch the inflows of investors coming to Binh Duong after the COVID-19 epidemic.

Biwase decided to spend capital to invest in improving capacity and expanding the scope of water supply for potential urban areas and industrial parks, especially with the humanistic meaning of bringing a clean water supply network to rural production area outside the industrial zones that many other provinces and cities have not yet been able to do. The right direction of the Biwase Board of Directors has received strong support from shareholders. The direction has helped Biwase bring in a profit of USD 8 million in the first 6 months in the face of price fluctuations in the market.

Loan resources effectively used

Mr. Nguyen Van Thien, Chairman of the Board of Directors of Biwase, said that in only the first 5 months of 2022, Biwase earned a profit of over USD 8 million. “The unexpected profit that Biwase made despite the global uptrend was because in 2021 the company was disbursed by the Asian Development Bank (ADB) and the Japan International Cooperation Agency (JICA) in form of mortgage of USD 16 million. In February 2022, all cast iron pipes were imported to Vietnam at the same time that the world iron and steel price suddenly increased by 60% at a equivalence to USD 8 million compared to the time of disbursement. When the pipes were available to execute the project as planned, Biwase made a big profit thanks to the price hikes," said Mr. Thien.

As mentioned above, in the context of the world economy in general and domestic production being stagnated due to the impact of the COVID-19 epidemic, as soon as the loan was approved, Biwase used up all to finance the project of purchased cast iron pipes as committed to expand the water supply network, bring clean water to the people, and open up many opportunities for industrial development in the northern part of the province and the localities that Biwase was actively integrating its development work. Specifically, Biwase has implemented a project to expand the factory, innovate technology, to develop Gia Tan water supply infrastructure in Dong Nai province and bring clean water to Cam My district with a water supply capacity of over 30,000 m3 a day night. Cam My is a district bordering Long Thanh airport and Chau Duc district of Ba Ria - Vung Tau province where people have not had access to clean water for a long time. This is also a location that is forecasted to develop strongly in urban areas, industry, services and international airports just in a short time.

In addition, Chon Thanh Water Supply Branch in Binh Phuoc Province continues to invest in developing the water supply pipeline from the border of Binh Duong province to Binh Long town of Binh Phuoc province in a notion considered as the industrial, urban and service center of Binh Phuoc province. Also in the project, Chon Thanh Water Supply Branch also developed a pipeline along National Highway 14 to Nha Bich Bridge which is the development point of Binh Phuoc province with Becamex Binh Phuoc Urban Industrial Park. The above pipelines with a water supply capacity of over 200,000m3 a day night are said to ease the thirst for clean water of the locality, and create a driving force to attract investors and improve the quality of life of people in the area.

Mr. Nguyen Van Thien frankly said on taking control at Can Tho Water Supply Company 1 and 2 that Biwase will focus on technological innovation and customer development for efficient exploitation and operation. At the same time, the company has under stable operations in the field of waste collection and treatment. Biwase is keepitng on to complete the composting plants with a capacity of 840 tons a day and a power plant with a capacity of 5 MW a day using heat from waste treatment. The technology contributes to environmental protection and brings great economic benefits thanks to the initiative of renewable energy sources. The two plants will officially operate at the end of 2022, marking Biwase's technological level of scientific and technical capacity in environmental remediation and renewable energy use.

In the first 5 months of 2022, the total revenue of Biwase's water supply segment was VND 1,500 billion. The company also completed the procedures to buy back shares and participated in the operation of Can Tho Water Supply Company 1 and 2, and implemented many new investment projects. Last year's business results put Biwase at a total revenue of VND 3,572 billion, by which profit after tax was estimated at VND 738 billion, increasing by 40%.

Reported by Minh Duy – Translated by Vi Bao