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BUSINESS SPOTLIGHT

Hoa Sen Group not subject to US anti-evasion taxes

Released at: 08:00, 20/12/2019 BUSINESS SPOTLIGHT

Hoa Sen Group not subject to US anti-evasion taxes

Photo: Hoa Sen Group

Group not on list issued by US Department of Commerce detailing taxes on steel imports.

by Thanh Thanh

The Hoa Sen Group has confirmed it is not affected by the US’s decision to impose anti-evasion taxes of up to 456.2 per cent on anti-corrosion steel and cold-rolled steel manufactured from base steel originating from South Korea and Taiwan (China).

The US Department of Commerce (DOC) on December 16 made its final decision on the application of anti-dumping duties (AD) and countervailing duties (CVD) on corrosion-resistant steel (CORE) and cold-rolled steel (CRS) manufactured in Vietnam using hot-rolled steel (HRS) and/or CRS from South Korea and Taiwan (China).

According to DOC’s decision, the Vietnamese group is not on the list of businesses subject to the taxes. DOC therefore allows the group to participate in the certification process of CORE and CRS shipments exported to the US without using base steel from South Korea and Taiwan (China), so it will not be subject to taxes.

“We always strictly abide by all DOC regulations when exporting goods to the US,” a representative from the Hoa Sen Group said. “For export shipments to the US, we do not use steel substrates originating from South Korea and Taiwan (China). At the same time, we provide documents proving the origin of input materials, the production process, and the output products, as required by DOC, in a very transparent way. This DOC decision does not affect the production and business activities of the Hoa Sen Group. We are exporting orders to the US market already.”

Vietnam’s steel industry has continuously faced trade defense lawsuits in foreign markets in recent years. Fierce competition in the domestic market due to oversupply and the US-China trade war has also made the HRS price fall during this business cycle, creating difficulties for businesses.

However, the Hoa Sen Group has still achieved positive results, confirming its solid prospects into the future. Proactively restructuring its distribution system, balancing its financial structure, reducing debt, cutting inventory, restructuring products, and focusing on commodities and markets with high profit margins, in FY2018-2019 Hoa Sen posted VND28 trillion ($1.2 billion) in revenue and VND361 billion ($15.5 million) in consolidated after-tax profit.

Outstanding loans both short-term and long-term as at the end of FY2018-2019 were nearly VND9.7 trillion ($417.7 million), down some VND4.65 trillion ($200 million) compared to the beginning of the fiscal year. Its bank debt / equity ratio dropped sharply, from 2.78 times to 1.77 times.

Recently, on the VNR500, a ranking of the 500 largest enterprises in Vietnam based on the Fortune 500 and published by Vietnam Report, the Hoa Sen Group was the 12th-largest private enterprise in Vietnam 2019 and the 36th-largest enterprise.

This year the Hoa Sen Group was also honored in many other rankings, such as the Top 100 Sustainable Development Enterprises by the Business Council for Vietnam’s Sustainable Development (VBCSD) under the Vietnam Chamber of Commerce and Industry (VCCI) and the Top 1000 largest taxpayers in Vietnam announced by the General Department of Taxation, while products of Hoa Sen and Hoa Sen zinc pipes won the National Quality Award from the Ministry of Science and Technology, presented by the Prime Minister in June.

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