ROLL SPORT VIET NAM FOOTWEAR LIMITED

Credit Risk Assessment: ROLL SPORT VIET NAM FOOTWEAR LIMITED

ROLL SPORT VIET NAM FOOTWEAR LIMITED (CÔNG TY TNHH GIẦY ROLL SPORT VIỆT NAM) is an established player in Vietnam’s thriving footwear manufacturing industry. Operating under 100% foreign direct investment (FDI) and strategically located in Hoang Long Industrial Park, Thanh Hoa City, the company is part of the expansive GREAT ASCENT TRADING LIMITED group based in Hong Kong.

As a credit risk manager, a comprehensive evaluation of the company’s financial position and operational performance is crucial in determining its reliability for credit extension, trade finance, and long-term partnership.

Company Overview

• Business ID: 2801572789

• Ownership: 100% FDI (Hong Kong)

• Established: June 2, 2010

• Registered Capital: USD 69.39 million

• Employees: 19,000

• General Director: Mr. CHANG, YU - WEI (Taiwanese)

• Core Activity: Processing leather shoes for export markets

Financial Performance Analysis

📌 Revenue and Profitability

• Revenue (2024): USD 130.32 million (▲12.44% YoY)

• Profit (2024): USD 1.53 million (▼1.47% YoY)

• Despite a revenue rebound in 2024, net profit has remained stagnant, indicating persistent margin pressure, possibly from labor or material cost volatility.

📌 Asset and Equity Movement

• Total Assets (2024): USD 110.09 million (▼11.03% YoY)

• Owner’s Equity (2024): USD 93.30 million (▲51.23% YoY)

• The decline in assets could reflect asset depreciation, debt repayment, or a restructuring of operations. However, the sharp equity increase—from USD 61.7 million to USD 93.3 million—suggests new capital infusion or retained earnings conversion, strengthening the capital base and reducing financial leverage.

📌 Working Capital and Liquidity

• Working Capital: USD 14.01 million (▲158.09% YoY)

• The drastic rise in working capital implies improved short-term liquidity, enhancing the firm’s capacity to meet obligations. It’s a positive signal for suppliers and lenders regarding near-term solvency.

Risk Considerations

🔺 Profitability Pressure

The company has seen three consecutive years of profit decline (2022–2024), though slight in 2024. With a labor force of 19,000 and fluctuating raw material prices, ROLL SPORT may be operating on thin margins. For credit decisions, profitability trends must be monitored closely to ensure continued debt service capability.

🔺 Volatility in Asset Base

The asset base has contracted by over 11% in 2024. Unless this is linked to efficiency improvements or debt reduction, it might reflect underlying operational stress.

🔺 High Operational Scale

Employing nearly 19,000 workers in a labor-intensive industry also carries operational and regulatory risks—especially in the context of tightening global standards on ESG and labor practices.

Credit Risk Outlook

Risk Rating: Moderate

✅ Positives:

• Strong equity position (low gearing)

• Reliable ownership (established FDI backing)

• Positive revenue recovery trend

• Significant working capital growth

⚠️ Risks to Monitor:

• Declining profitability

• Shrinking asset base

• Sensitivity to global retail demand and trade policy shifts

Conclusion

From a credit risk perspective, ROLL SPORT VIET NAM FOOTWEAR LIMITED appears to be a financially resilient but margin-sensitive company. While its capital structure has been reinforced and liquidity has improved, ongoing earnings volatility and asset contraction suggest a need for cautious credit exposure.

For financial institutions, suppliers, and partners, short-to-medium-term engagements with proper credit terms and collateralization (if applicable) are advisable. Continued financial reporting and transparency will be essential in reassessing the company’s creditworthiness over time.