- 2024-10-31T00:00:00
- Company Research
- ACV released its 9M 2024 results, posting a 12% YoY increase in revenue and a 27% YoY increase in PBT, adjusted for FX gains/losses. We note that ACV’s earnings reached a record-low in Q3 and Q4 2023 due to a large bad debt provision of VND674bn (USD27mn) and VND1.2tn (USD48mn).
- Overall, 9M 2024 revenue and NPAT-MI fulfill 69% and 67% of our respective full-year forecasts. We foresee insignificant changes to our forecasts, pending a fuller review.
- In 9M 2024, international passenger numbers surged 30% YoY, totaling 30.5 million, in line with our full-year forecast of 45 million. Typically, Q4 is the high season for international passengers, with an average contribution of 31% to the full-year total number of passengers.
- Foreign arrivals fully recovered in 9M 2024, reaching 99% of the pre-COVID-19 levels, with Chinese arrivals achieving 68%. We expect the recovery of foreign arrivals to continue, with a higher recovery rate of Chinese arrivals in Q4 2024 and 2025.
- In constrast, in 9M 2024, domestic passenger numbers dropped 18% YoY to 52.8 million, trailing our expectation of 74.2 million, due to high airfares. We expect high airfares to ease gradually as domestic airlines complete aircraft repairs and fuel costs decrease. Additionally, an improvement in customer purchasing power should support a recovery in domestic passengers.
- In Q3 2024, ACV recognized an increase of VND54bn (USD2.2mn) in bad debt provisions, resulting in a total provision balance of VND3.9tn (USD156mn; +1% QoQ) as of Q3 2024. For 9M 2024, ACV booked VND220bn (USD8.8mn) in bad debt provisions, which is lower than our expectation of VND600bn (USD24mn) for 2024F. We attribute this to the positive recovery of domestic airlines and ACV’s effective strategy to prevent the emergence of new receivables.
- ACV incurred FX losses of VND792bn (USD32mn) in Q3 2024 due to an 8% appreciation in the JPY/VND exchange rate, hurting ACV’s JPY debt load. This outweighed VND540bn (USD22mn) of FX gains during H1 2024.
ACV’s 9M 2024 results
VND bn | Q3 2023 | Q2 2024 | Q3 2024 | QoQ | YoY | 9M 2023 | 9M 2024 | YoY | 9M 2024 as % of 2024F | 2024F |
Net revenue | 5,328 | 5,535 | 5,655 | 2% | 6% | 14,985 | 16,834 | 12% | 69% | 24,572 |
Aeronautical revenue | 3,737 | 3,862 | 3,970 | 3% | 6% | 10,452 | 11,794 | 13% | 68% | 17,238 |
Take-off and landing fees | 682 | 682 | 715 | 5% | 5% | 1,932 | 2,089 | 8% | 72% | 2,911 |
Non-aeronautical revenue | 927 | 1,008 | 988 | -2% | 7% | 2,652 | 3,001 | 13% | 69% | 4,361 |
ACV’s net revenue * | 4,664 | 4,869 | 4,957 | 2% | 6% | 13,104 | 14,795 | 13% | 68% | 21,662 |
Gross profit | 3,331 | 3,460 | 3,642 | 5% | 9% | 9,228 | 10,702 | 16% | 68% | 15,650 |
SG&A | -1,009 | -332 | -385 | 16% | -62% | -2,287 | -1,214 | -47% | 62% | -1,949 |
EBIT | 2,322 | 3,128 | 3,258 | 4% | 40% | 6,941 | 9,487 | 37% | 69% | 13,701 |
Financial income | 995 | 827 | 294 | -64% | -70% | 1,853 | 1,600 | -14% | 100% | 1,602 |
Financial expenses | -20 | -27 | -809 | 2944% | 3936% | -366 | -855 | 133% | 529% | -162 |
Net income from associates | 113 | 81 | 134 | 66% | 19% | 245 | 276 | 13% | 87% | 318 |
PBT | 3,414 | 3,999 | 2,878 | -28% | -16% | 8,680 | 10,506 | 21% | 68% | 15,501 |
PBT adj. for FX | 2,920 | 3,576 | 3,662 | 2% | 25% | 8,489 | 10,766 | 27% | 70% | 15,401 |
NPAT | 2,764 | 3,228 | 2,339 | -28% | -15% | 7,010 | 8,488 | 21% | 67% | 12,721 |
NPAT-MI | 2,763 | 3,225 | 2,336 | -28% | -15% | 7,003 | 8,479 | 21% | 67% | 12,683 |
ACV’s NPAT-MI | 2,415 | 2,898 | 1,978 | -32% | -18% | 6,012 | 7,469 | 24% | 66% | 11,275 |
State’s NPAT-MI ** | 348 | 327 | 358 | 10% | 3% | 992 | 1,009 | 2% | 72% | 1,408 |
D&A | 609 | 573 | 562 | -2% | -8% | 1,774 | 1,721 | -3% | 67% | 2,565 |
EBITDA | 2,931 | 3,700 | 3,819 | 3% | 30% | 8,715 | 11,208 | 29% | 69% | 16,267 |
GPM | 62.5% | 62.5% | 64.4% |
|
| 61.6% | 63.6% |
|
| 63.7% |
SG&A/rev | -18.9% | -6.0% | -6.8% |
|
| -15.3% | -7.2% |
|
| -7.9% |
EBITDA margin | 55.0% | 66.9% | 67.5% |
|
| 58.2% | 66.6% |
|
| 66.2% |
NPM * | 51.8% | 59.5% | 39.9% |
|
| 45.9% | 50.5% |
|
| 52.0% |
Source: ACV, Vietcap forecast. Note: (*) Excluding contribution from State-invested aviation assets;
(**) NPAT-MI from assets owned by the State (State-invested aviation assets) — the State authorizes ACV to manage these assets (including runways).
ACV’s accounts receivable as of Q3 2024 (VND bn)
VND bn | Total | Gross doubtful receivable | Net doubtful receivable |
All clients | 11,363 | 8,844 | 4,899 |
Vietjet Air | 3,031 | 2,242 | 2,212 |
Bamboo Airways | 2,340 | 2,340 | 0 |
Vietnam Airlines | 3,745 | 2,989 | 2,686 |
Pacific Airlines | 888 | 888 | 0 |
Source: ACV
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