The Vietnam National Coal, Mineral Industries Holding Corporation Limited (Vinacomin) was faced with a lot of difficulties in the first nine months of this year, particularly in slowing coal consumption and export. At present, coal inventories reached 7.8 million tonnes. However, the group has applied many consistent solutions to cut costs, rearrange personnel and focus on prioritised products to improve the situation.
Focusing on economy, security
CEO Le Minh Chuan of Vinacomin said: "The group signed contracts to export nearly 3 million tonnes of coal in the fourth quarter. The domestic coal demand is forecast to rise 2.5 - 3 million tonnes in 2014. Thus, the target sale of 39 - 40 million tonnes this year is within reach."
In the first nine months of 2013, Vinacomin produced 31 million tonnes of coal, stripped off 152 million cubic metres of earth and rock, dug 258,000 metres of tunnels, sold 28.2 million tonnes of clean coal, including 8.4 million tonnes exported, and raked in revenues of VND68 trillion, including VND38 trillion from coal sales. Given current development, Vinacomin will strive to bring this year’s sale to 39 - 41 million tonnes of coal in the fourth quarter of 2013. The group will also try to slash inventories and ensure jobs for employees.
In addition, its Tan Rai alumina plant, which is being commissioned at a full designed capacity, is expected to put into official operation soon. Alumina sale reached 80,000 tonnes and the sale is expected to top 130,000 tonnes at the end of the year. In 2014 when Tan Rai plant enters stable operation, the alumina sale is forecast to total 400,000 - 450,000 tonnes. Criteria set for electricity and mineral were also achieved.
Chuan said policies on coal will be heavier in the coming time, particularly higher royalties and environmental charges .Therefore, there are no other way than enhance economy and minimise costs. In addition, the shortage of coalminers and the redundancy of indirect labourers is also a difficult issue.
Besides, the group also intensify labour safety and minimises workplace accidents. In the fourth quarter, Vinacomin will perform workplace safety tests in its member companies. After the checking, the group will introduce best solutions to ensure safe production and minimise accidents.
Proactively approaching capital sources
Vinacomin successfully issued VND5 trillion of five-year bonds bearing floating coupon rates. This offering caught the attention and interest of market members, including commercial banks (both foreign and domestic lenders), finance companies, fund management companies, insurance companies, and securities firms. The value registered exceeded the value offered. That is a testament to the group’s high reputation in the market.
This was also the biggest bond issue in Vietnamese dong by Vinacomin as well as State-owned economic groups. This marked the rally of corporate bond market after a quiet period.
Vinacomin also signed an agreement on continued cooperation with the Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank). Vietinbank has financed Vinacomin and its member companies to carry out annual business plans and major investment projects approved by the government since 2007. Vietinbank always gives priority to short-term, medium-term and long-term credit to Vinacomin. The outstanding loan usually stands at over VND10 trillion.
Minh Nghia
Vietnamese
