- 2024-07-30T00:00:00
- Company Research
- TLG reported its H1 2024 results with revenue and NPAT-MI increasing 1% and 23% YoY, respectively, achieving 51% and 82% of our respective 2024F full-year forecasts.
- Per management, revenue growth in H1 2024 was mainly driven by export demand. We estimate that exports contributed ~35% to total revenue, compared to 23% in full-year 2023.
- Domestic demand, however, recovered at a slower pace with Q2 2024 domestic revenue sliding 7% YoY, per our estimation. TLG expects stronger restocking from both the domestic and international markets starting mid-2024.
- The GPM widened from 42.5% in Q1 2024 to 48.5% in Q2 2024, driven by plastic recycling and new premium SKUs helping offset increases in the price of plastic.
- SG&A expenses/revenue reached 26.6% in H1 2024, compared to our full-year projection of 30.8%. This number is higher vs the level of 24%-25% in 2015-2019 due to TLG spending heavily on its sales force and marketing. We also note that TLG has a track record of recognizing higher SG&A expenses in the second half of the year as the company ramps up advertisting and marketing activities. H2 2023 SG&A expenses/revenue was 36.9%.
- We expect earnings to continue recovering throughout 2024, driven by improvements in the sales volume and product mix. We foresee potential upside to our forecasts, pending a fuller review.
TLG’s H1 2024 results
VND bn | Q2 2023 | Q1 2024 | Q2 2024 | Q2 2024 YoY | H1 2023 | H1 2024 | H1 2024 YoY | H1 2024/ 2024F | 2024F |
Net revenue | 1,069 | 809 | 1,207 | 13% | 1,988 | 2,016 | 1% | 51% | 3,925 |
Domestic | 866 | 493 | 809 | -7% | 1,513 | 1,302 | -14% | 44% | 2,966 |
Exports | 203 | 315 | 398 | 96% | 475 | 714 | 50% | 74% | 959 |
Gross profit | 478 | 343 | 586 | 23% | 863 | 929 | 8% | 55% | 1,688 |
SG&A expense | -277 | -238 | -297 | 7% | -544 | -536 | -1% | 44% | -1,207 |
Operating profit | 201 | 105 | 289 | 44% | 319 | 394 | 23% | 82% | 481 |
Interest expense | -5 | -3 | -3 | -41% | -10 | -8 | -22% | 58% | -14 |
Net other gain/loss | -28 | -12 | -44 | 57% | -41 | -55 | 36% | 86% | -64 |
NPAT-MI | 168 | 88 | 242 | 44% | 268 | 331 | 23% | 82% | 404 |
GPM | 44.7% | 42.5% | 48.5% |
| 43.4% | 46.1% |
|
| 43.0% |
SG&A/revenue | -25.9% | -29.5% | -24.6% |
| -27.3% | -26.6% |
|
| -30.8% |
OPM | 18.8% | 13.0% | 23.9% |
| 16.0% | 19.5% |
|
| 12.3% |
NPM | 15.7% | 10.9% | 20.1% |
| 13.5% | 16.4% |
|
| 10.3% |
Source: TLG, Vietcap forecast, (*Note: Domestic and export revenue are Vietcap estimates)
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