SCS – Cargo throughput bounces back – Earnings Flash
  • 2024-01-19T00:00:00
  • Company Research
  • SCS released its Q4 2023 results, which improved decently QoQ. SCS’s 2023 revenue and NPAT dropped 14% and 21% YoY, achieving 93% and 102% of our respective full-year forecasts.
  • Demand from trade activities trailed our expectations. However, financial income beat our expectation. We see slight potential downside risks to our forecasts, pending a fuller review.
  • Nevertheless, we expect SCS’s total air cargo throughput to recover at a mid-teen rate YoY in 2024 as trade recovers, led by restocking.
  • Q4 2023 international cargo volume increased 15% QoQ and 6% YoY, marking the beginning of an expected recovery trend.
  • However, EBIT margin compressed sharply to 64.6% in Q4 2023 amid the Ministry of Transport’s new concession scheme. In this new scheme, SCS will have to pay another 1.5%-4.5% of its air cargo revenue in concession to the State.
  • The new Long Thanh International Airport will have two cargo terminals. Hence, business can potentially be divided cleanly between two existing groups of operators in Vietnam’s airports.
  • SCS plans to become a shareholder and the only operator of cargo terminal No.  1 in Long Thanh Airport. This terminal will have a capacity of 550,000 tonnes/year and cost USD43mn in capex.

SCS’s Q4 2023 results

VND bn

 Q3 2023 

Q4 2022

Q4 2023

 YoY 

2022

2023

YoY

2023/ 2023F

2023

Int’l cargo volume 

34,379

36,914

39,173

6%

176,540

137,110

-22%

97%

141,232

Domestic cargo volume

11,766

11,177

14,241

27%

44,426

52,719

19%

101%

52,423

Total cargo volume

46,145

48,091

53,414

11%

220,966

189,829

-14%

98%

193,655

Average service price (VND/kg)

3,417

3,784

3,380

-11%

3,463

3,404

-2%

94%

3,615

 

 

 

 

 

 

 

 

 

 

Revenue

172 

196 

199 

1%

818

705

-14%

93%

758

    Air cargo terminal

158 

182 

181 

-1%

765

646

-16%

92%

700

    Others

13 

14 

13 

-4%

52

53

2%

92%

58

Gross Profit

134 

165 

144 

-13%

656

535

-18%

95%

564

SG&A

12 

12 

16 

33%

57

52

-9%

92%

56

Operating Profit

122 

153 

128 

-16%

599

484

-19%

95%

507

Financial income

24 

18 

19 

6%

61

88

45%

142%

62

PBT

146 

170 

146 

-14%

697

569

-18%

100%

566

NPAT-MI

128 

157 

146 

-7%

651

516

-21%

102%

507

 

 

 

 

 

 

 

 

 

 

GPM

78.0%

84.2%

72.6%

 

80.2%

75.9%

 

 

74.4%

SG&A/Revenue

7.0%

6.1%

8.0%

 

7.0%

7.3%

 

 

7.4%

OPM

71.0%

78.1%

64.6%

 

73.3%

68.6%

 

 

66.9%

NPM

74.4%

80.1%

73.5%

 

79.6%

73.2%

 

 

66.8%

Source: SCS, Vietcap forecast



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