Steelmaker Hoa Phat in the red after 13 years
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Leading steelmaker Hoa Phat lost VND1.79 trillion ($73 million) in the third quarter, its first quarterly loss in 13 years.
It reported revenues of VND34.44 trillion in the quarter, down 12% from the same period last year and 8% from the previous quarter.
Its revenues have declined steadily after peaking in the fourth quarter of last year.
Steel demand is down in both Vietnam and globally, raw material prices have risen sharply – by three times in the case of coal – and exchange and interest rates have become adverse, the company said to explain the loss.
For the first nine months, the company’s revenues were VND116.6 trillion, with the steel segment contributing 90%, and profits topped VND10.44 trillion.
It said the agricultural segment was profitable again, with revenues and profits rising by 10% and 32% year-on-year in the third quarter.
Another major steel firm, Nam Kim, announced Friday that it racked up losses of over VND400 billion in the third quarter. It dragged the profits for the year down to VND290 billion, a sixth of the figure a year earlier.
Questions & Answers
Q.What is the primary reason given for Hoa Phat's recent loss?
What is the primary reason given for Hoa Phat's recent loss?
The company attributes the loss to several factors, including a decline in steel demand both in Vietnam and globally, sharply rising raw material prices, and adverse exchange and interest rates. Coal prices, for example, have tripled.
Q.How did Hoa Phat's revenue in the third quarter compare to previous periods?
How did Hoa Phat's revenue in the third quarter compare to previous periods?
Hoa Phat reported revenues of VND34.44 trillion in the third quarter. This figure is down 12% from the same period last year and an 8% decrease from the previous quarter. Revenues have been steadily declining since late last year.
Q.Which of Hoa Phat's business segments remained profitable in the third quarter?
Which of Hoa Phat's business segments remained profitable in the third quarter?
The agricultural segment was profitable for Hoa Phat in the third quarter. It saw revenues increase by 10% and profits rise by 32% year-on-year, contributing positively to the company's overall performance.
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