Steelmaker Hoa Sen eyes smallest profit in 10 years

By Phuong Dong   February 21, 2023 | 02:03 am PT
Steelmaker Hoa Sen eyes smallest profit in 10 years
A view of the Hoa Sen steel plant . Photo by VnExpress/Thuy Dung
Steelmaker Hoa Sen Group expects a modest after-tax profit of VND100 billion (US$4.2 million) to VND300 billion this year as a raft of potential pitfalls loom.

Whichever figure it achieves will be the lowest in the last 10 years, mainly due to anticipated export difficulties.

According to the first scenario envisioned by Hoa Sen, the company will post sales of 1.4 million tons of finished products, with revenues of VND34 trillion, and after-tax profits of VND100 billion.

With a more optimistic scenario of selling 1.5 million tons of finished products, the company expects to gain VND36 trillion in revenue and VND300 billion in profit.

In the last 10 years, the lowest profit target the company has ever set is VND400 billion and the highest is VND1.65 trillion.

Hoa Sen’s management said steel exports this year have many potential uncertainties in the context of increasing competition and trade barriers.

Tightened monetary policies and higher lending interest rates as well as foreign exchange rates will also affect the company’s production and business.

Hoa Sen reported after-tax losses of VND680 billion from October to December 2022, the first quarter of this fiscal year.

According to Viet Dragon Securities Corp., having incurred net losses for two consecutive quarters, the steelmaker is experiencing the most difficult period in its history.

Hoa Sen’s difficulties are considered to be twice as bad as its competitors as it operates in both the manufacturing and retail sectors.

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