- 2024-04-16T00:00:00
- Company Research
- PPC released its Q1 2024 results with revenue of VND2.0tn (+52% YoY) and reported NPAT-MI of VND157bn (4x YoY). We attribute this surge to (1) 64% YoY higher sales volume following the S6 generator’s re-operation and (2) 18% YoY lower maintenance & other expenses. Additionally, the 157% YoY higher dividend income further supports reported NPAT-MI.
- Q1 2024 results are in line with our expectations, completing 28% and 22% of our 2024 revenue and reported NPAT-MI forecasts, respectively. However, as HND announced its preliminary 2023 DPS lower than our expectation, we foresee slight downside risk to our PPC’s 2024 earnings forecast, pending a fuller review.
HND (PPC’s 27%-stake associate company) Q1 2024 NPAT-MI completed 15% of our full-year forecast, trailing our expectation. HND reported its Q1 2024 results with revenue of VND2.8tn (+8% YoY) and reported NPAT-MI of VND155bn (15x YoY). We attribute the jump in reported NPAT-MI to the (1) 35% YoY higher sales volume, (2) estimated 25% YoY lower average material cost, (3) 25% YoY lower depreciation expenses, and (4) 47% YoY lower maintenance & other expenses. These Q1 results are equivalent to 26% and 15% of our full-year revenue and reported NPAT-MI forecasts, respectively. This reported NPAT-MI trailed our expectation due to a higher-than-expected depreciation expense. Therefore, we foresee a downside risk to our earnings forecast for HND. The company also released its AGM materials with preliminary guidance for 2023 DPS of VND1,102 (final DPS will be decided in the upcoming AGM) vs our forecast of VND1,752, and as such we see slight downside risk to our dividend income forecast for PPC from HND as we expect the final DPS to be higher than preliminary guidance.
The average material cost of PPC and HND are decreasing YoY, which confirm our expectation. We estimate that in Q1 2024, PPC and HND’s average material cost decreased by 4% YoY and 25% YoY, respectively. We currently forecast the mixed coal price to decrease 6% YoY in 2024. This is broadly in line with our expectation.
PPC’s Q1 2024 results
VND bn | Q1 2023 | Q1 2024 | YoY % | % of Vietcap’s 2024F |
Sales volume (million kWh) | 653 | 1,070 | 64% | 26% |
Price spread (VND/kWh) | 321 | 251 | -22% | 74% |
ASP (VND/kWh) | 2,006 | 1,865 | -7% | 108% |
Average material cost (VND/kWh) | 1,684 | 1,614 | -4% | 117% |
Revenue | 1,311 | 1,996 | 52% | 28% |
COGS | -1,287 | -1,901 | 48% | 29% |
- In which, maintenance & other expenses | -124 | -101 | -18% | 25% |
Gross Profit | 23 | 95 | 310% | 17% |
G&A | -23 | -31 | 34% | 24% |
Operating profit (EBIT) | 0 | 64 | N.M. | N.M. |
Net interest income | 3 | 1 | -75% | 14% |
Dividend income | 37 | 94 | 157% | 25% |
Others | 0 | 0 | 36% | N.M. |
PBT | 40 | 159 | 300% | 20% |
Income tax exp | 0 | -2 | N.M. | 2% |
Reported NPAT | 40 | 157 | 295% | 22% |
NPAT from power generation * | 3 | 63 | 1932% | 18% |
Source: PPC, Vietcap
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