HPG deducts VND353 billion for provision for devaluation of inventory

At the time of 31st Oct 2008 Hoa Phat Group has deducted VND353 billion for provision for devaluation of inventory. After the deduction, profit after tax during 10 months of 2008 of HPG was VND 809 billion, reaching 109% of the 2008 plan. Turnovers of the Group reached VND 7,129 billion, equivalent 93% of revenue plan.

According to Mr. Tran Tuan Duong, General Director of Hoa Phat Group JSC, the deduction for  provision for devaluation of inventory was applied to steel products. Up to late Oct 2008, the Group has inventory of construction steel valued at VND 814 billion, of which 21 thousand tons of steel products, 19 thousand tons of billet steel and 30 thousand tons of scrap. Inventory of steel pipe and raw materials for production is about 27 thousand tons, equivalent to around VND 410 billion. This is the normal amount of inventory when the factory is in the process of continuous production.
 

The updated information from the Sales Department of Hoa Phat Group JSC showed that within 18 days of early November, HPG has sold 19 thousand tons of construction steel. Thus the above inventory has much reduced.

Currently, billet steel plant of HPG still continuously operates with full capacity. The steel rolling mill and the steel pipe factory operate with 75% of capacity. However, the point is that the Hoa Phat steel market share is still constantly expanding on the market.

The two biggest scale projects of the Group including a project to build Hoa Phat Iron and Steel Complex and Hoa Phat Cement Plant project are in the urgent completion phase to ensure schedule, waiting ahead for the time of economic recovery and warming up.

HPG