- PLX released Q2 2023 results with reported NPAT-MI of VND774bn compared to a loss of VND30bn in Q2 2022, which was due to stable petroleum prices in Q2 2023 vs volatile prices in most of Q2 2022 that resulted in a ~VND1.0tn inventory provision. In H1 2023, PLX's revenue was VND133tn (USD5.6bn; -12% YoY) while its reported NPAT-MI was VND1.4tn (USD58mn; +553% YoY), completing 62% and 40% of our respective full-year forecasts and trailing our expectations. We foresee slight downside risk to our forecasts for PLX, pending a fuller review. 

- We believe higher-than-expected selling expenses (mainly due to labor costs) and lower-than-expected financial income in Q2 2023 could outweigh 1) an increase in regulated costs beginning from July 1, 2023, that could help PLX’s NPAT increase by 3%-5% and 2) potential upside to our 2023 sales volume forecast as H1 2023 sales volume rose ~3% YoY from 2022’s high base when PLX took market share from smaller players. PLX’s H1 2023 volume completed 50% of our full-year forecast.

- In Q2 2023, PLX's revenue was VND65.7tn (USD2.8tn; -23% YoY). We attribute the decline in revenue mainly to the average Vietnamese E5 gasoline retail price of VND21,385/liter (-26% YoY & 3% QoQ) and average Vietnamese diesel retail price of VND18,540/liter (-30% YoY & 13% QoQ), which outweighed PLX’s 2% YoY higher sales volume for the quarter. The strong volume partly helped gross profit to complete 55% of our full-year forecast; however, selling expenses jumped 16% YoY and completed 57% of our full-year projection. Furthermore, financial income only completed 39% of our full-year forecast. Therefore, the bottom line was lower than expected.

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