- 2024-07-31T00:00:00
- Company Research
* HDG announced its Q2 2024 results with revenue of VND560bn (-1% YoY) and reported NPAT-MI of VND74bn (+110% YoY). We attribute the YoY flat revenue to a 28% YoY increase in office leasing & hotel revenue, which offset a 7% decline from the energy segment (mainly due to weak hydropower). The doubled YoY NPAT-MI was mainly due to (1) 25% YoY lower G&A expenses and (2) a 25% YoY decline in financial expenses.
* H1 revenue and reported NPAT-MI were VND1.4tn (-7% YoY) and VND296bn (-13% YoY), completing 51%/45% of our respective full-year forecasts. The YoY decline in revenue was mainly due to 17% YoY lower energy revenue outweighing 21% YoY higher revenue from the office leasing & hotel segment. We attribute the YoY weaker NPAT to 25% weaker YoY gross profit from the energy segment (due to the low water inflow and higher contracted sales volume ratio of 98% vs 90% previously) while office leasing and real estate’s gross profit increased 18%/1% YoY, respectively.
* H1’s real estate revenue completes 74% of our projection (we are contacting HDG for a breakdown), however, the H1 GPM from real estate sales was 38%, lower than our 2024F forecast of 64% and 2023 actual of 56%. As a result, H1 gross profit completes 46% of our full-year projection. We expect HDG to launch sales of the Charm Villas Phase 3 in H2 2024 but recognize sales over three years (2024-25-26).
* Overall, we see insignificant changes to our 2024F earnings forecast (NPAT-MI of VND652bn, -2% YoY), pending a fuller review, as slightly lower-than-expected financial expenses might potentially offset slightly lower-than-expected energy profit.
* We currently have a MARKET PERFORM rating for HDG with a target price of VND29,300/share.
HDG’s H1 2024 results
VND bn | Q2 2023 | Q2 2024 | YoY | H1 2023 | H1 2024 | YoY | % of Vietcap’s 2024F |
Revenue | 564 | 560 | -1% | 1,520 | 1,408 | -7% | 51% |
Real estate | 80 | 84 | 4% | 392 | 399 | 2% | 76% |
Energy | 375 | 348 | -7% | 918 | 762 | -17% | 42% |
Office leasing & hotel | 97 | 124 | 28% | 198 | 239 | 21% | 52% |
Construction & others | 12 | 4 | -63% | 12 | 8 | -30% | N.M. |
Gross profit | 280 | 282 | 1% | 856 | 720 | -16% | 45% |
Real estate | 11 | 32 | 189% | 138 | 152 | 11% | 46% |
Energy | 225 | 198 | -12% | 622 | 464 | -25% | 44% |
Office leasing & hotel | 36 | 52 | 43% | 88 | 103 | 18% | 51% |
Construction & others | 8 | 0 | N.M. | 8 | 0 | N.M. | N.M. |
Selling exp | -3 | -1 | -61% | -4 | -2 | -43% | 12% |
G&A | -67 | -50 | -25% | -103 | -83 | -20% | 45% |
Operating profit | 209 | 231 | 10% | 748 | 635 | -15% | 46% |
Financial income | 10 | 7 | -28% | 16 | 20 | 24% | 64% |
Financial expenses | -140 | -106 | -25% | -289 | -202 | -30% | 42% |
In which, interest expense | -127 | -86 | -32% | -258 | -181 | -30% | 43% |
Other non-operating income | 16 | 6 | -65% | 19 | 4 | -81% | N.M. |
PBT | 95 | 138 | 45% | 494 | 457 | -8% | 49% |
- Income tax exp | -19 | -26 | 41% | -60 | -81 | 35% | 65% |
NPAT before MI | 76 | 111 | 45% | 434 | 376 | -13% | 46% |
- Minority interest | -41 | -37 | -10% | -96 | -80 | -16% | 49% |
NPAT-MI | 35 | 74 | 110% | 338 | 296 | -13% | 45% |
Source: HDG, Vietcap
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