- 2024-07-17T00:00:00
- Company Research
- H1 2024 results: DRC announced its robust H1 2024 results with net revenue of VND2.3tn (USD91.7mn; +3% YoY) and NPAT-MI of VND127bn (USD5.0mn; +66% YoY), fulfilling 48% and 47% of our respective full-year forecasts. As the results are in line with our expectations, we see no risk to our 2024F forecasts, pending a more comprehensive review.
- Q2 2024 results: Q2 2024 NPAT-MI significantly rose by 52% YoY to VND77bn (USD3.0mn), which we attribute to (1) higher sales volume YoY and (2) gross margin expansion outweighing higher selling expenses YoY. We attribute higher sales volume to the improved reputation of DRC’s products in the US despite insignificant impacts from the US’ preliminary determination for the anti-dumping investigation on truck and bus tires exported from Thailand. On a QoQ basis, NPAT-MI jumped 57% due to (1) stronger sales volume from a low base in Q1 (i.e., Q1 historically records the lowest sales volume in a given year) and (2) gross margin expansion.
- Profitability: Gross profit margin expanded 7.6 ppts YoY/3.5 ppts QoQ to 20.1% in Q2 2024. We attribute this improvement to the realization of lower-cost inventory procured in the previous quarters following the prices of raw materials cooling down after their peaks in 2022.
DRC’s Q2 2024 & H1 2024 results
VND bn | Q2 2024 | QoQ | YoY | H1 2024 | YoY | H1 2024 as % of 2024F |
Net revenue | 1,364 | 40% | 17% | 2,337 | 3% | 48% |
COGS | -1,090 | 34% | 7% | -1,901 | -6% | 47% |
Gross profit | 274 | 70% | 89% | 436 | 68% | 56% |
Selling expenses | -158 | 82% | 156% | -246 | 90% | 67% |
GA expenses | -23 | 26% | 9% | -42 | 15% | 54% |
EBIT | 93 | 64% | 49% | 149 | 56% | 44% |
Net financial income & net other income | 5 | 175% | 697% | 6 | N.M. | N.M. |
PBT | 97 | 68% | 55% | 156 | 69% | 46% |
NPAT-MI | 77 | 57% | 52% | 127 | 66% | 47% |
Gross margin | 20.1% | 3.5 ppts | 7.6 ppts | 18.7% | 7.2 ppts |
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EBIT margin | 6.8% | 1.0 ppts | 1.4 ppts | 6.4% | 2.2 ppts |
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NPAT-MI margin | 5.7% | 0.6 ppts | 1.3 ppts | 5.4% | 2.1 ppts |
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Source: DRC, Vietcap
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