GAS - 2023 earnings in line with our forecast – Earnings Flash
  • 2024-01-31T00:00:00
  • Company Research
  • GAS announced its Q4 2023 results with revenue of VND22.6tn (+2% YoY) and NPAT-MI of VND2.7tn (-16% YoY). Q4 2023 NPAT-MI increased 15% vs a low base in Q3 2023, which was driven by a 15% QoQ higher gas sales volume and 51% QoQ lower financial expenses, outweighing a 10% QoQ lower average fuel oil (FO) price. GAS reversed VND104bn of provision expenses (under GA expenses) in Q4 2023 due to a decrease in bad debts in Q4 vs Q3.
  • In 2023, GAS recorded revenue of VND90tn (-11% YoY) and NPAT-MI of VND11.6tn (-22% YoY), which are equivalent to 104% and 99% of our respective forecasts. We attribute the YoY drop in NPAT-MI to 1) a 11% YoY lower average FO price, 2) a 6% YoY lower gas sales volume, and 3) 14% YoY higher SG&A expenses (mainly due to GAS recording VND152bn of provision expenses in 2023).
  • The average FO price – the benchmark for Vietnam’s gas price — decreased by 11% YoY to USD448/tonne in 2023, which is in line with our forecast of USD450/tonne.
  • According to GAS, gas sales volume fell 6% YoY to 7.3 bcm in 2023, completing 98% of our volume forecast and in line with our expectation. This decline is mainly due to 7% YoY weaker gas volumes sold to 1) power plants due to low competitive generation market (CGM) prices despite favorable weather for gas-fired power plants and 2) industrial parks due to economic slowdown.
  • We foresee insignificant changes to our 2024 forecasts, pending a more comprehensive review.
  • We currently have a MARKET PERFORM rating for GAS with a target price of VND88,400/share.

GAS’s Q4 2023 & 2023 results

VND bn

Q4 2023

YoY

2023

YoY

% of Vietcap’s 2023F

Average Brent oil price (USD/bbl)

83

-8%

82

-17%

99%

Average fuel oil price (USD/tonne)

453

19%

448

-11%

100%

Gas sales volume (million cbm)

1,773

-13%

7,300

-6%

98%

Revenue

22,571

2%

89,954

-11%

104%

COGS

-18,512

8%

-73,029

-8%

105%

Gross profit

4,058

-17%

16,925

-21%

99%

SG&A expenses

-1,106

7%

-4,019

14%

101%

Operating profit (EBIT)

2,953

-23%

12,906

-27%

99%

Financial income

544

11%

2,273

45%

96%

Financial expense

-138

-25%

-587

-13%

98%

Profit before tax (PBT)

3,365

-19%

14,640

-22%

98%

Income tax expense

-589

-29%

-2,846

-24%

95%

NPAT before MI

2,776

-17%

11,793

-22%

99%

Minority interest (MI)

-53

-39%

-187

-30%

88%

Reported NPAT-MI

2,723

-16%

11,606

-22%

99%

Source: GAS, Fiinpro, Vietcap

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