The 2024 Annual General Meeting of Shareholders of HMC took place on the morning of April 23. Photo: VH
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Looking back on 2023, Mr. Vo Tri Nghia, General Director of HMC, assessed that it was the most difficult year since the COVID-19 pandemic. “The economy faced many difficulties, and the steel industry also faced many challenges. Steel prices fell continuously 19 times and lasted for 3 quarters. Rarely has a year seen such a decline in steel prices,” Mr. Nghia emphasized.
In addition, the sluggish real estate market led to a decrease in steel consumption. “In 2023, interest rates on deposits were at a record low, but the amount of money deposited in banks still increased. This shows that opportunities are still limited. If there is no money flowing into the market, how can real estate grow? In the first quarter of 2024, credit growth was even negative,” Mr. Nghia shared.
In that context, HMC recorded net revenue of nearly VND 3,120 billion in 2023, down 9% year-on-year. However, net profit reached over VND 21 billion, 6.7 times higher than the same period last year, mainly due to the low base.
With this result, the company plans to pay a cash dividend of 8% for 2023, meaning that each share will receive VND 800.
Also in 2023, the company decided to temporarily suspend the Vinh Loc steel processing plant expansion project due to procedural problems, and also has not completed the transaction to sell shares of Nha Be Steel (currently has provided more than VND 8 billion).
2024 remains challenging
Looking ahead to 2024, the General Director of HMC assessed that the situation is still very difficult and not as optimistic as many previous assessments. He cited figures from the General Statistics Office on the number of businesses leaving the market in the early months of the year to illustrate the severity of the current situation.
On the macroeconomic side, inflation may rise again, the exchange rate is still trending upwards, while government intervention is limited. Geopolitical conflicts are also a major challenge, especially the conflict in the Red Sea.
In addition, the weakening of the Chinese economy will also affect Vietnam. According to Mr. Nghia, fluctuations in the Chinese economy will directly and “drastically” affect Vietnam.
“The world remains unpredictable, the war is prolonged, and if there is a change on either side, forecasts and calculations will also change,” said Mr. Nghia.
In that challenging context, HMC sets quite cautious business targets for 2024, with revenue of VND 3,036 billion and profit after tax of VND 16 billion, down 3% and 24% respectively compared to 2023. In the first quarter of 2024, HMC earned a profit of VND 3.6 billion and achieved 23% of its profit plan.
HMC’s profit after tax plan
Unit: Billion VND
The surge in exchange rates has caused significant damage to HMC
In 2024, HMC sets a target of 210,000 tons for consumption output.
In which, the output of imported steel is targeted at 55,000 tons, an increase of 13-15% year-on-year. According to Mr. Nghia, the strong fluctuations in the exchange rate will greatly affect this steel import segment.
“When building the plan, we forecast the exchange rate of USD/VND at 24,800, but now it has increased to 25,500. This has caused great damage to HMC. However, HMC is currently making efforts to control this issue,” he said.
In the construction steel segment, the company sets an output target of 140,000 tons, an increase of 3% year-on-year. According to Mr. Nghia, in the past few years, the construction steel segment at HMC has grown strongly, and not increasing output too strongly this year is to ensure safety in terms of capital. “Construction steel has a large output, a lot of capital, but high risks and not very high profits,” he said.
Electing a new term Board of Directors
Another important content at this meeting is the election of the Board of Directors for the term 2024-2029. The candidates include two current members, Mr. Vo Tri Nghia and Ms. Cu Thi Thuy Linh, and three new members, Mr. Nguyen Ba An, Ms. Nguyen Thuy Ly, and Mr. Le Van Quang.
Among them, Mr. Le Van Quang is the representative for the capital contribution of Vietnam Steel Corporation – Joint Stock Company (VNSteel, UPCoM: TVN). Currently, TVN owns 22.27% of capital in HMC, equivalent to more than 6 million shares. Previously, he had held many positions at HMC and is currently a member of the Board of Directors and Deputy General Director of Da Nang Steel Joint Stock Company.
 The 2024-2029 Board of Directors of HMC
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After counting the votes, the General Meeting of Shareholders approved the applications. Subsequently, the Board of Directors held its first meeting to elect Mr. Vo Tri Nghia as Chairman of the Board of Directors of HMC, and Mr. Le Van Quang as General Director.
At the end of the meeting, all submissions were approved.
