Hoa Phat suddenly stops cash dividend plan due to US tariffs

"Steel King" changes dividend payment plan for 2024. Photo: Nam Khanh.

Hoa Phat Group Joint Stock Company (HoSE: HPG) has just announced changes to the dividend payment plan for 2024 and the expected rate for 2025.

Specifically, according to documents released at the end of March, the Board of Directors of the "steel king" plans to submit to shareholders for approval a dividend payment plan for 2024 at a rate of 20%, including 5% in cash and 15% in shares. The source of dividend payment is from undistributed after-tax profits.

With nearly 6.4 billion shares in circulation, Hoa Phat plans to spend nearly VND3,200 billion to pay cash dividends and issue nearly 960 million new shares. The implementation period is within 6 months from the date of approval by the General Meeting of Shareholders.

However, in the latest change plan, Hoa Phat unexpectedly adjusted to pay 2024 dividends entirely in shares at a rate of 20%. If approved, the company plans to issue nearly 1.3 billion additional shares.

The company cited the adjustment as a result of developments in the Trump administration's reciprocal import tax policy and on a cautious basis to ensure cash flow.

With the 2025 dividend rate, Hoa Phat maintains the expected rate at 20%.

In the 2025 Annual General Meeting of Shareholders document, billionaire Tran Dinh Long's group set a target revenue of VND170,000 billion, an increase of 21% compared to 2024. The target profit after tax is VND15,000 billion, an increase of 25%.

If completed, this will be the highest revenue ever for the steel industry giant.

For the steel industry, the US Department of Commerce (DOC) recently announced a decision to impose preliminary taxes ranging from 40% to more than 88% on galvanized steel products imported from Vietnam.

Among the investigated enterprises, Hoa Sen Group (HoSE: HSG) was subject to the highest tax rate of up to 59%. Hoa Phat Steel under Hoa Phat Group and Nam Kim Steel (HoSE: NKG) were both subject to a tax rate of 49.42%.

Meanwhile, Ton Dong A Company (HoSE: GDA) is the only public enterprise enjoying the lowest rate, at 39.84%.

Several other companies such as Pomina Steel, TVP Steel, Tay Nam Steel, Phuong Nam Steel, and foreign-invested enterprises such as China Steel & Nippon Steel Vietnam, Maruichi Sun Steel, Sam Hwan Vina and Viet Phap Steel and Steel are also subject to a tax rate of 49.42%.

Notably, Vietnamese businesses not specifically named in the preliminary decision will face a tax rate of up to 88.12%.

(Source: ZNews)

Link: https://znews.vn/hoa-phat-bat-ngo-dung-ke-hoach-co-tuc-tien-mat-vi-thue-quan-my-post1544425.html

Source: https://vtcnews.vn/hoa-phat-bat-ngo-dung-ke-hoach-co-tuc-tien-mat-vi-thue-quan-my-ar936542.html