Source: Viet Nam News
Giant steel maker Hoa Sen Group said recently it has stopped investing in the property and tourism sectors since returns in them are below expectations.
The company told Việt Nam News there would be no more investment in the Vân Hội eco-tourism project in the northern province of Yên Bái and Hội Vân hot spring tourism project in the south-central province of Bình Định.
It will also sell lands it had planned to develop in Đỗ Xuân Hợp Street in HCM City’s District 9.
Pulling the plug on property investments is just one of several measures it will take to resolve its financial problems.
Another is to cut interest costs by keeping inventories to a minimum.
Other costs have also been cut by restructuring the distribution system and temporarily not opening more branches, the company said.
Besides, it is simplifying human resources and installing an enterprise resource planning (ERP) system to cut down the spending on human resources.
HSG said these changes had already helped reduce loans by over VNĐ3.1 trillion (US$136 million) since the end of June to VNĐ12.7 trillion ($557 million).
In 2017-18 the company produced 1.8 million tonnes of steel and earned revenues of VNĐ34 trillion ($1.5 billion), respectively up 13 per cent and 32 per cent from the previous year.
The revenues jumped both in the domestic and foreign markets, the company said.
Profit after tax was VNĐ410 billion ($18 million).
The company holds over 35 per cent of the steel sheet market and 18 per cent of the steel pipe market, the second highest share in the country.
It has 11 steel plants in the country 500 outlets. HSG also manufactures plastic products and aims to become among the top three manufacturers in the country.
It produces 5,000 tonnes of three kinds of plastic pipes per month and sells them all over the country.