Page 531 - Ebook HTKH 2024

4.5. Assessment of the current business performance in the green economic
growth trend of Hoa Phat Group Joint Stock Company

4.5.1. Positive aspects
The company has occupied the leading market share in the industry in recent years.
Compared to some competitors, the company's market share increased sharply in the
period from 2018 to 2023. The scale of revenue as well as high profits help the enterprise
to further strengthen its financial potential. This is a strength in enhancing the company's
competitiveness.
HPG’s return on sales (ROS) is always higher than HSG. This is HPG’s
competitive advantage; on the positive side, the company's efforts.

HPG’s return on assets (ROA) and labor productivity are also always higher than
HSG. This is HPG’s strength.
There is a great effort in converting “gray steel” production technology to
environmentally friendly “green steel” production.
4.5.2. Limitations and shortcomings
Some financial indicators such as return on sales (ROS), return on assets (ROA)

decreased sharply from 2021 to 2022 and tend to continue to decrease until 2023. Thus,
these indicators have not recovered compared to the COVID period.
Although inventory turnover tends to increase, it is still slow, this index is much
lower than that of competitors in the same industry (HSG) and is on a downward trend.
The debt collection period index shows signs of increasing in 2022, which shows
that the company is having problems collecting debts from customers.
Asset turnover tends to increase in 2022 and in the period 2018 - 2023, this index

is even lower than that of competitors.
Labor productivity in 2023 has not recovered compared to 2021.
Regarding resource use and environmental pollution treatment: Hoa Phat has only
focused on innovating green steel production technology lines mainly applied in two
industrial parks in Hai Duong and Quang Ngai while HPG has up to 17 member units.
However, other units do not smelt iron or steel. In other units, in general, resource use

and environmental pollution treatment are present but not significant; published data are
still modest.
4.5.3. Causes of limitations and shortcomings
The volatile situation (hot at the beginning of the year, gradually cooling down and
freezing at the end of the year) of the real estate industry has caused a clear decline in
both demand and selling price of construction steel in 2022, one of Hoa Phat's key
products with a proportion of more than 70% of domestic consumption.
Coal prices have skyrocketed due to the crisis from geopolitical conflicts,

combined with the impact of slow consumption and low selling prices due to weak
demand, putting a lot of pressure on the cost of goods sold.
Some financial indicators such as return on sales (ROS), return on assets (ROA)
have decreased sharply from 2021 to 2022. Profit after tax has decreased significantly
due to increased costs. The company needs to pay attention to cost management.

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