Pomina Steel's losses, debt worry auditor

Ernst & Young Vietnam’s audit of the company’s first half operations found that the VND8 billion ($341,000) profit it has reported should be correctly filed as a VND23 billion loss.

Pomina said that a provision for falling inventory value due to declining steel prices was the reason for the loss.

The auditor’s report said Pomina's short-term debt of VND10.73 trillion, ten times its short-term assets of VND1 trillion, throws doubt about the firm’s ability to overcome the crisis and continue its operations.

Pomina leaders, however, have expressed confidence that the situation will improve when its blast furnace comes into full operation in the remaining months.

The company has targeted profits of VND400 billion for the year.