- NKG reported Q3 2022 revenue of VND4.4tn (USD180.6mn; -41% YoY & -39% QoQ) and a net loss of VND419bn (USD17.1mn) compared to VND607bn (USD24.8mn) of net profit in Q3 2021. We attribute these weak Q3 2022 results to a slowdown in demand in both domestic and export markets as well as an unfavorable trend in hot rolled coil (HRC) prices.

- NKG’s galvanized steel sheet and steel pipe sales volume dropped 37% YoY to 174,900 tonnes in Q3 2022. For 9M 2022, NKG’s galvanized steel sheet and steel pipe sales volume was 692,500 tonnes (-13% YoY).

- NKG incurred a VND159bn (USD6.5mn) loss at the gross profit level in Q3 2022 that resulted from stagnant sales. Meanwhile, both input HRC and galvanized steel selling prices experienced a more than 30% correction following their YTD peak in April 2022. This market situation caused steelmakers to be trapped with high purchased input costs while subsequent sales were slow, resulting in a strong gross margin contraction.