Steel maker Hoa Sen Group will consult shareholders about a plan to issue shares to mobilise capital of VND1 trillion (US$42.8 million).

In early April, the shares will be issued to existing shareholders, strategic partners and other investors to mobilise capital for production and business activities.

The Board of Directors will be authorised to decide on the method, share prices, time and related procedures of the issuance.

In addition to the share issuance, Hoa Sen Group also plans to issue nearly 38.5 million shares as payment for dividends with a rate of 10 per cent for the 2017-18 fiscal year. The issuance is expected to be completed before June 30.

Currently, Hoa Sen Group is actively restructuring its distribution system under the provincial branch model. Under the new model, in each province and city, Hoa Sen will choose an outlet as the main branch, the others in the same province and city will be operated by the main branch.

This is also the reason why Hoa Sen Group has closed its branches. According to the Group, they closed the branches to move to the new operation model and this was not to do with business performance.

In 2018, Hoa Sen Group earned VND34.4 trillion in revenue, up 31.7 per cent compared to the previous year. However, due to sharp increase in costs, post-tax profit reached just VND409 billion, equal to 31 per cent of the profit achieved in 2017 and equivalent to a quarter of the annual profit plan. — VNS