QTP – Q1 NPAT jumps 57% YoY, ahead our forecast - Earnings Flash
  • 2024-04-19T00:00:00
  • Company Research
  • QTP released robust Q1 2024 results with revenue of VND3.0tn (flat YoY) and reported NPAT-MI of VND227bn (+57% YoY). The strong performance is mainly due to (1) an 8% YoY increase in sales volume, coupled with (2) a 10% YoY decrease in the average material cost, and (3) a 33% YoY decrease in depreciation expenses.
  • Q1 2024 results are above our expectations, completing 24% and 27% of our 2024 revenue and reported NPAT-MI forecasts, respectively. We attribute the higher-than-expected reported NPAT-MI to the lower-than-expected average material cost, as well as higher-than-expected volume. We foresee upside potential to our QTP’s earnings forecast, pending a fuller review.

The decreasing YoY average material costs for coal-fired power companies within our coverage suggest upside potential to our earnings forecast. In Q1 2024, we estimate that the average material costs for PPC, QTP, and HND (Not-rated) decreased by 4%/10%/25% YoY, respectively. We currently forecast the mixed coal price to decrease 6% YoY in 2024. For PPC, this is broadly in line with our expectation. However for QTP, the more significant reductions in material costs suggest there could be a slight upside to our earnings projections.

Strong dividend yield outlook (10-12%). According to the AGM 2024 documents, QTP raised its 2023 cash dividend guidance to VND1,500/share. Although on a preliminary basis, it is slightly lower than our current projection of VND1,886/share. We are waiting for the final DPS to be approved in the upcoming AGM. As of now, QTP has already paid an advance 2023 cash dividend of VND1,036/share (including VND750/share by using 2023 retained earnings and VND286/share by reallocating its development and investment fund). This implies the remaining 2023 cash dividend to be VND464/share. For 2024, QTP plans to pay a 2024 cash dividend of VND1,000/share. This is lower than our projection of VND1,800/share. We believe this guidance is conservative because up until now, QTP has usually raised its cash dividends significantly higher than it initially planned. QTP initially issued a cash dividend of VND1,000/share, which was raised to VND1,600/share in 2021, VND2,250/share in 2022, and now VND1,500/share in 2023 (preliminary basis).

QTP’s Q1 2024 results

VND bn

Q1 2023

Q1 2024

YoY %

% of Vietcap’s 2024F

Sales volume (million kWh)

1,657

1,796

8%

25%

Price spread (VND/kWh)

363

369

2%

110%

ASP (VND/kWh)

1,807

1,676

-7%

97%

Average material cost (VND/kWh)

1,445

1,307

-10%

94%

Revenue

2,995

3,010

0%

24%

  COGS

-2,817

-2,726

-3%

24%

  - In which, depreciation expense

-226

-152

-33%

25%

  - In which, maintenance & other expenses

-134

-160

20%

53%

Gross Profit

178

284

59%

27%

  G&A

-21

-23

6%

19%

Operating profit (EBIT)

157

261

67%

28%

Financial income

15

0

-99%

2%

Financial expenses

-19

-9

-55%

45%

        In which, interest expense

-19

-6

-69%

32%

PBT

152

252

66%

27%

  Income tax expense

-8

-25

231%

27%

Reported NPAT

144

227

57%

27%

Source: QTP, Vietcap

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