- 2024-01-19T00:00:00
- Company Research
SZC released its Q4 2023 results with revenue increasing 32% YoY to VND259bn (USD11mn) and NPAT-MI surging 49% YoY to VND56bn (USD2.3mn). We attribute the strong YoY growth in Q4 2023 mainly to the scheduled IP land sales handover to A Chau Agricultural Products and Siba High-tech Mechanical, both of which signed contracts/MOU in 2022.
SZC's 2023 NPAT-MI increased by 11% YoY to VND219bn (USD9.0mn), mainly thanks to a recovery in the IP segment's GPM. This 2023 NPAT-MI result was equivalent to 102% of our forecast and in-line with our expectation. We also anticipate no significant changes to our 2024F NPAT-MI forecast of VND275bn (USD11mn; +26% YoY), mainly driven by the expected GPM improvement and a higher contribution from the residential segment.
For the IP segment, 2023 segment revenue (accounting for 84% of total revenue) decreased by 9% YoY to VND684bn (USD28mn). GPM of this segment improved to 54.4% vs 40.1% in 2022 and vs our 2023F forecast of 53.6%.
For the residential segment, 2023 segment revenue (accounting for 9% of total revenue) was VND72bn (USD3.0mn; +8% YoY), driven by the handover of shophouse units at the Huu Phuoc UA project, while the segment GPM was 65.6% in 2023.
SZC's total unearned revenue and advances from customers was VND685bn (USD28mn; -4% YoY) as of end-2023, which we believe represents headroom for the company to recognize IP & UA land sales in the future.
We note that SZC has not provided details regarding its IP segment in terms of IP land leasing area and average leasing price during the specified period. In December 2023, D2D and SZC (with SNZ owning 58% and 52% of each, respectively) signed a contract for D2D to lease a 6.5-ha land plot at the Chau Duc IP of SZC with a leasing price of USD79/sqm, which has yet to be recognized as revenue as of end-2023.
SZC’s 2023 results
VND bn | Q4 2022 | Q4 2023 | YoY | 2022 | 2023 | YoY | 2023F | 2023 as % of 2023F |
Net revenue | 196 | 259 | 32% | 859 | 818 | -5% | 756 | 108% |
| 114 | 223 | 96% | 752 | 684 | -9% | 612 | 112% |
| 67 | 18 | -74% | 67 | 72 | 8% | 84 | 86% |
| 11 | 14 | 22% | 27 | 48 | 79% | 46 | 105% |
| 3 | 4 | 15% | 12 | 14 | 10% | 15 | 93% |
Gross profit | 68 | 93 | 37% | 310 | 350 | 13% | 345 | 101% |
SG&A expenses | -16 | -24 | 47% | -50 | -55 | 10% | -45 | 121% |
EBIT | 51 | 68 | 34% | 260 | 295 | 14% | 300 | 98% |
Financial income | 6 | 8 | 35% | 15 | 17 | 12% | 14 | 122% |
Financial expense | -10 | -11 | 8% | -32 | -46 | 43% | -45 | 102% |
Net other income | 2 | 1 | -64% | 2 | 0 | N.M. | 0 | N.M. |
PBT | 48 | 65 | 36% | 244 | 267 | 9% | 269 | 99% |
NPAT-MI | 38 | 56 | 49% | 197 | 219 | 11% | 215 | 102% |
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GPM | 34.6% | 35.8% |
| 36.1% | 42.8% |
| 45.7% |
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| 45.8% | 55.9% |
| 40.1% | 54.4% |
| 53.6% |
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| 79.9% | 24.9% |
| 79.9% | 65.6% |
| 69.3% |
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OPM | 26.2% | 26.5% |
| 30.2% | 36.1% |
| 39.7% |
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NPM | 19.2% | 21.7% |
| 23.0% | 26.8% |
| 28.4% |
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Source: SZC, Vietcap forecast (last updated December 29, 2023)
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