- TDM announced its Q3 2023 results with revenue of VND107bn (USD4.4mn; -13% YoY) and NPAT-MI of VND57bn (USD2.3mn; +4% YoY). We estimate NPAT from water generation to be VND38bn (USD1.5mn; -30% YoY) in Q3 2023. TDM recorded 2022 dividend income of VND19bn (USD0.8mn) from Dong Nai Water Supply JSC (UPCoM: DNW) in Q3 2023. This figure outweighs water sales volume decreasing 14% YoY to 15.4 million cbm.

- In 9M 2023, TDM recorded revenue of VND341bn (USD14.0mn; -3% YoY) and NPAT-MI of VND240bn (USD9.8mn; +64% YoY), amount to 68% and 82% of our respective full-year forecasts. The jump in NPAT-MI was mainly due to TDM recording 2022 dividend income of VND94bn (USD4.0mn) from Binh Duong Water – Environment Corporation – JSC (HOSE: BWE) in Q1 2023 vs recording no dividend income from BWE in 9M 2022.

- We estimate NPAT from water generation to be VND127bn (USD5.2mn; -12% YoY) in 9M 2023, which represents 64% of our full-year forecast. We attribute the decline in NPAT from water generation to a 4% YoY decrease in water sales volume and a 27% YoY increase in SG&A expenses, primarily driven by labor costs. We note that TDM’s 9M 2023 water sales volume decreased 4% YoY to 49.3 million cbm, completing 69% of our full-year volume forecast (71.4 million cbm; +3% YoY).

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