Major steel producers Formosa Ha Tinh Steel Corporation (Formosa Ha Tinh) and Posco Yamoto Vina had unhealthy financials for two consecutive years of 2018 and 2019, according to a report submitted by the Ministry of Finance (MoF) to the PM last week, analyzing financial statements of over 22,600 foreign-invested enterprises (FDI) in Vietnam.
Taiwanese-invested Formosa Ha Tinh, infamous for dumping toxic waste killing over 100 tons of fish and devastating the environment and economies of four central provinces in 2016, had accumulated post-tax losses of more than VND25.38 trillion ($1.11 billion) by 2019, and is having difficulty repaying its debt, the report says.
From net revenues of VND72 trillion, Formosa Ha Tinh reported a loss of VND11.5 trillion in 2019, 4.2 times the loss it reported the previous year.
Formosa's current solvency ratio is low, indicating that the company is using short-term capital to invest in long-term assets.
Similarly, South Korean-Japanese invested steel producer Posco Yamoto Vina reported a loss of VND2.78 trillion in 2019, almost three times the VND1 trillion it reported the previous year. It is also having difficulties repaying its debt.
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