- 2024-04-26T00:00:00
- Company Research
- Q1 2024 results: Net sales inched up 1% YoY to VND14.1tn and NPAT-MI grew 18% YoY to VND2.2tn, completing 22% and 24% of our respective full-year forecasts. NPAT-MI was slightly ahead of our expectation due to higher-than-expected net financial income. According to Nielsen IQ, the value of Vietnam’s milk-based products dropped 3% YoY in Q1.
- Domestic sales: In Q1 2024, VNM’s parent domestic sales (excluding MCM – VNM’s indirect subsidiary) increased 2% YoY, which outperformed the trend of Vietnam’s dairy sector value reported by Nielsen as above. This growth was mainly driven by double-digit growth in (1) condensed milk, (2) drinking yogurt, and (3) plant-based milk. Conversely, MCM’s sales declined 15% YoY to VND625bn due to unfavorable weather conditions in northern Vietnam.
- Overseas market: Combined sales from overseas subsidiaries — including Driftwood (US) and Angkor Milk (Cambodia) — grew 10% YoY in Q1 2024. Export revenue increased 6% YoY in Q1 2024.
- Profitability: GPM improved 3.1 ppts YoY to 41.9% in Q1 2024 due to the YoY decline in input milk costs. Operating margin also improved 2.3 ppts YoY to 17.2% in Q1, which is partly offset by a 80-bps YoY increase in SG&A/sales to finance active marketing activities during the quarter.
- Our view: VNM’s Q1 2024 results are broadly in line with our forecasts in terms of top line and operating profit, meanwhile its net financial income tracked ahead of our forecast. We see upside potential to our 2024F NPAT-MI forecast, pending a fuller review.
VNM’s Q1 2024 results
VND bn | Q1 2023 | Q1 2024 | YoY | 2024F | Q1 2024 as % of 2024F |
Net revenue | 13,918 | 14,112 | 1% | 63,468 | 22% |
| 11,491 | 11,497 | 0% | 52,946 | 22% |
| 1,225 | 1,297 | 6% | 5,431 | 24% |
| 1,203 | 1,319 | 10% | 5,091 | 26% |
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Gross profit | 5,398 | 5,912 | 10% | 26,462 | 22% |
| 4,525 | 4,848 | 7% | 22,324 | 22% |
| 639 | 764 | 20% | 3,088 | 25% |
| 234 | 300 | 28% | 1,050 | 29% |
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SG&A expenses | -3,331 | -3,491 | 5% | -15,669 | 22% |
EBIT | 2,067 | 2,421 | 17% | 10,793 | 22% |
Net financial income | 261 | 285 | 9% | 880 | 32% |
NPAT-MI | 1,857 | 2,195 | 18% | 9,219 | 24% |
Gross margin | 38.8% | 41.9% |
| 41.7% |
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| 39.4% | 42.2% |
| 42.2% |
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| 52.1% | 58.9% |
| 56.9% |
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| 19.5% | 22.7% |
| 20.6% |
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SG&A/net sales | 23.9% | 24.7% |
| 24.7% |
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EBIT margin | 14.9% | 17.2% |
| 17.0% |
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NPAT-MI margin | 13.3% | 15.6% |
| 14.5% |
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Source: VNM, Vietcap
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