SAB - Earnings growth mainly driven by optimized A&P expenses - Earnings Flash
  • 2024-10-31T00:00:00
  • Company Research

* 9M 2024 results:

- SAB announced its 9M 2024 results with net revenue of VND22.9tn (USD917.6mn; +5% YoY) and NPAT-MI of VND3,365bn (USD134.6mn; +6% YoY).

- The results complete 70% and 75% of our respective full-year forecasts and are in line with our expectations. We thus see no significant risks to our 2024F forecasts, pending a more comprehensive review.

* Q3 2024 results:

- Net revenue increased 3% YoY to VND7.7tn (USD306.8mn) in Q3 2024, driven by beer revenue rising 4% YoY, which we mainly attribute to higher YoY ASP despite continued strict enforcement of drunk driving laws. Additionally, Q3 2024 EBIT increased at a significantly faster pace than net revenue growth at 29% YoY. This is due to SAB optimizing its selling expenses (mainly coming from 19% YoY lower advertising & promotional - A&P expenses). However, lower net financial income YoY and a lower gain from associates YoY dragged NPAT-MI growth to 7% YoY, reaching VND1,119bn (USD44.8mn) in Q3 2024.

- Profitability: Beer GPM slightly contracted by 0.9 ppts to 33.2% in Q3 2024, which is mainly due to SAB continuing to realize high-cost raw materials. However, the blended EBIT margin expanded by 3.1 ppts to 15.5% in Q3 2024, driven by A&P expenses/beer revenue declining by 3.5 ppts to 6.8% - the lowest level over the last 10 quarters.

SAB’s Q3 2024 & 9M 2024 results

VND bn

Q3 2024

YoY

9M 2024

YoY

9M 2024/

Vietcap's 2024F

Net revenue

7,670

3%

22,940

5%

70%

 Beer revenue

6,932

4%

20,379

4%

71%

 Others

738

-1%

2,561

9%

65%

Gross profit

2,278

2%

6,819

3%

70%

 Beer GP

2,302

1%

6,846

2%

70%

 Other GP & sales deduction 

-24

-48%

-27

-44%

35%

Selling expenses

-868

-22%

-2,612

-17%

58%

G&A expenses 

-224

10%

-610

4%

72%

EBIT

1,186

29%

3,597

24%

82%

Net financial income

241

-32%

799

-22%

65%

Gain/loss from associates

51

-34%

67

-66%

27%

Net other income

-7

291%

-26

80%

74%

PBT

1,471

9%

4,408

7%

75%

NPAT-MI

1,119

7%

3,365

6%

75%

Blended GPM

29.7%

-0.4 ppts

29.7%

-0.5 ppts

 

Beer GPM

33.2%

-0.9 ppts

33.6%

-0.5 ppts

 

Blended EBIT margin

15.5%

3.1 ppts

15.7%

2.4 ppts

 

EBIT/beer revenue 

17.1%

3.4 ppts

17.7%

2.8 ppts

 

Blended NPAT-MI margin

14.6%

0.5 ppts

14.7%

0.2 ppts

 

A&P spending/Beer revenue

6.8%

-3.5 ppts

7.4%

-2.4 ppts

 

Source: SAB, Vietcap

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