Steel giant Vnsteel suffers $35 mln loss in 2022

Vietnam Steel Corporation (Vnsteel), Vietnam's leading steelmaker, reported a loss of VND822 billion ($35 million) in 2022, while its profit hit VND859 billion ($36.63 million) in the previous year.

The company recorded revenue of VND38,732 billion ($1.65 billion), down 5% year-on-year, according to its Q4 consolidated financial statement.

Notably, its joint ventures and associates posted a loss of VND734,800 billion ($31.33 million) in 2022, while 2021 saw a profit of VND155.7 billion ($6.64 million).

At the end of the year, the firm's total assets reached VND23,178 billion ($988.4 million), down 15% from the beginning of the year.

Currently, Vnsteel's largest shareholder is the State Capital and Investment Corporation (SCIC), with a 93.93% stake.

Vnsteel is listed on the Unlisted Public Company Market (UpCOM) as TVN. At the closing session on Thursday, TVN shares were priced at VND5,500 ($0.23).

At a conference to review 2022 and deploy tasks for 2023, Vnsteel's deputy general director Le Van Thanh said the steel market had experienced unexpected fluctuations. Prices of energy and raw materials used for steel production like coal, iron ore and scrap steel increased strongly and suddenly at the start of the year, with some hitting record hikes.

"But, the prices later dropped quickly and deeply, hitting a two-year low. Downturn is the major trend of prices from May to the end of last year," Thanh noted.

"Those factors had a strong impact on Vnsteel's revenue and profit," he added.

In 2023, Vnsteel has set a target of total consolidated revenue of about VND35,800 billion ($1.53 billion) and consolidated pre-tax profit of VND50 billion ($2.13 million).

The revenue target for the parent company is VND1,899 billion ($80.98 million), and it aims to make profit.

Vietnam's steel sector in 2022 was negatively impacted by the real estate market depression. From April 2022, the property market fell into a state of reduced supply, declined demand, and plummeting liquidity. Domestic steel demand plunged due to the property market stagnation and tightened monetary policy.

Hoa Phat Group, the largest Vietnamese steelmaker, recorded a post-tax profit of VND8.4 trillion ($358 million) in 2022, down 76% year-on-year.

For Q4, it reported a post-tax loss of VND2 trillion ($85.29 million), worse than the Q3 loss of VND1.79 trillion ($76.33 million), according to the company's latest report.