Hanoi (VNS/VNA) - Despite disruptions caused by the fourth wave ofthe COVID-19 pandemic, steel producers still reported extraordinary profits.

In its third-quarter financial report, Hoa Phat Group (HPG) posted a rise of 56percent year-on-year in revenue to 38.9 trillion VND (1.7 billion USD),resulting in record profit after tax of 10.35 trillion VND, 2.7 times highercompared to last year.

As of September 30, the leading steel producer recorded revenue of over 105.8trillion VND, up more than 60 percent. Its profit after tax jumped 200 percentover last year to 27.1 trillion VND, which exceeded 45 percent of the year'splan.

In the past nine months, Hoa Phat produced 6.1 million tonnes of crude steel,up 50 percent over the same period last year. Sales of steel products reached6.3 million tonnes during the period, up 43 percent. Of which, constructionsteel sales rose 12 percent to 2.8 million tonnes, while hot rolled coil (HRC)sales reached nearly 2 million tonnes.

Tien Len Steel Group (TLH) also reported outstanding performance last quarter.

Even though the company’s consolidated net revenue increased 1.5 percentyear-on-year to nearly 909.4 billion VND, its profit after tax surged more than8.3 times to 105.5 billion VND.

Tien Len Steel Group said that the rise in revenue was driven by higher steelprices, while low inventories resulted in a sharp drop in the cost of goodssold. During the period, the company also minimised a number of expenses,leading to a sharp gain in net profit.

In the first nine months of 2021, its revenue climbed 15 percent to 3.28trillion VND, with net profit up to 422.3 billion VND from just nearly 997million VND in the same period last year. With the result, the company exceededits whole year target.

This year, Tien Len Steel Group set a target of 250 billion VND in profit aftertax.

Similarly, Thai Nguyen Iron and Steel (TIS) and Me Lin Steel (MEL) witnessedstrong growth in business results.

Thai Nguyen Iron and Steel said in its third-quarter report that the company’snet revenue jumped 46.5 percent over last year to nearly 3.1 trillion VND, withnet profit reaching nearly 10 billion VND, 25 times higher than that of lastyear.

During the period, its profit from financial activities rose strongly, whileinterest expenses declined.

In the first nine months, it posted an increase of 37.5 percent year-on-year toover 9.6 trillion VND. Given the sharp fall in expenses and higher steelprices, its profit after tax rose 7 times over last year's to 113 billion VND.

Meanwhile, Me Lin Steel recorded a loss of 18.7 percent in net revenue to 196billion VND. But thanks to a significant cut in expenses, with financialexpenses and general and administrative expenses both down more than half, itsprofit after tax was still 10.6 times higher than the same period last year toover 18.7 billion VND.

According to Me Lin Steel, in the third quarter, domestic steel prices rosesharply compared to the same period of 2020, while the company's inventorieswere still relatively low, so profits surged. At the same time, the companyalso maximised production and business expenses like sales and interestexpenses, and increased efficiency.

Le Xuan, a senior trader, said that steel enterprises were likely to benefit asChina was tightening its annual steel production output.

“Environmental problems and limited energy consumption are forcing Chineseenterprises to reduce output, causing a fall in the global steel supply, asChina is the world's largest steel exporter,” Xuan said.

“It will support our steel producers.”

On the stock market, HPG and TLH are listed on the Ho Chi Minh Stock Exchange(HoSE), while MEL is traded on the Hanoi Stock Exchange (HNX) and TIS is onUPCOM.

These stocks have gained strongly since the beginning of the year with HPGshares and TIS shares up 34 percent and 53.2 percent, respectively. TLH shareseven jumped more than 197.3 percent, while MEL shares rose nearly 130 percent.

“Steel stocks may still have room to increase thanks to the expectation ofprofit growth and public investment is expected to increase sharplypost-pandemic,” said Xuan.

She added that the restart of real estate projects also increased demand forsteel products./.