Listed steel companies reported positive business results in the first quarter of this year despite the impacts of the COVID-19 pandemic.

Giant steel maker Hoa Phat Group (HPG) earned a revenue of VND19.5 trillion (US$835.9 million) in the quarter, up 28 per cent year-on-year.

The company reported post-tax profit of VND2.3 trillion in Q1, up 27 per cent against last year.

In addition to steel production, Hoa Phat also operates in other fields such as furniture, refrigeration, real estate and agriculture.

On the stock market, Hoa Phat shares (HPG) rose sharply after plummeting to the two-year bottom of VND6,200 per share at the end of March this year. Currently, HPG is being traded at around VND23,600 per share, approximately equal to the price recorded at the beginning of this year.

Hoa Phat’s market share of construction steel increased to 31.9 per cent in Q1 with an output of nearly 733,000 tonnes after excluding steel billets. Of the estimate, the amount of exported finished steel products reached 135,000 tonnes, up 74.8 per cent over the same period last year.

The provision of steel billets reached about 350,000 tonnes, mainly for export. The main export markets for steel billets are China and Southeast Asian countries. The company also provided the market with nearly 145,000 tonnes of steel pipes.

In March, Hoa Phat supplied a total of 486,000 tonnes of finished steel products and steel billets to domestic and foreign markets.

Another notable steel producer, Hoa Sen Group (HSG), also witnessed profit growth during the reviewed period.

The fiscal year of Hoa Sen Group differs from others, starting from July 1 and ending on June 30 of the following year. Therefore, the first quarter of this year is considered the second quarter of the 2019-20 fiscal year of Hoa Sen Group.

In the quarter, Hoa Sen’s revenue reached VND5.8 trillion, down by 16.3 per cent year-on-year. Finance expense dropped by 44 per cent to VND223 billion, selling expense decreased by 48 per cent to nearly VND504 billion and corporate management costs slumped by VND104 billion to VND142 billion.

Post-tax profit reported in the quarter was VND201 billion, nearly four times higher than the profit achieved in the same period last year.

In the first six months of the fiscal year 2019-2020, the group reached VND382 billion in post-tax profit, 3.2 times higher than the same period last year and completed more than 95 per cent of the profit target assigned for the whole year.

According to SSI Securities Co, these results were attributed to the improvement in gross profit margin. Inventories were kept at a safer level, which allowed the company to focus on profits instead of sales as in previous years.

These were the results achieved after one year of restructuring the distribution system, SSI said.

Other steel enterprises that reported profit growth in the first three months of this year was Vietnam Germany Steel Pipe JSC.

The company recorded profit of VND10.6 billion, up 3.8 per cent year-on-year. But this profit was less than one third of that reported in the previous quarter.

Notably, Nam Kim Steel JSC (NKG) suffered a loss of more than VND100 billion in Q1 last year but enjoyed post-tax profit of VND41.5 billion in the period this year.

Revenue in Q1 reached VND2.45 trillion, down by 16.7 per cent year-on-year, in which export revenue was VND1.13 trillion, contributing about 46 per cent of total revenue.

As for business activities, Nam Kim Steel has continuously strengthened its co-operation with SMC, an industry partner. The continuous increase of SMC's ownership ratio in Nam Kim as well as the use of SMC’s personnel in Nam Kim shows the close co-operation between these two units.

Recently, the two funds, Vietnam Enterprise Investments Limited and Amersham Industries Limited, sold a total of more than nine million shares of Nam Kim (NKG), reducing their ownership to less than nine million shares and no longer the major shareholders of the group.

Nam Kim plans to reach VND12 trillion in revenue this year, down slightly from the revenue achieved in 2019.

It also aims to collect VND200 billion in post-tax profit, a sharp increase compared to the profit achieved in 2019.

Consumption is expected to reach 700,000 tonnes, up 7.4 per cent compared to that of 670,000 tonnes achieved in 2019.

Thong Nhat Flat Steel Joint Stock Company (TNS) also enjoyed after-tax profit of VND1.6 billion in Q1 this year while suffering a loss of VND7.6 billion in the same period last year. — VNS