BMP - Q4 top, bottom lines decline QoQ, YoY; full-year results in line with expectations - Earnings Flash
  • 2025-01-23T00:00:00
  • Company Research

BMP announced its 2024 results aligning with our forecasts, with details as follows:

Full-year results:

  • Net revenue: VND4.616bn (USD181.4mn, -10% YoY; 101% of our 2024F forecast).
  • NPAT-MI: VND991bn (USD38.9mn, -5% YoY; 97% of our 2024F forecast).

Q4 results: 

  • Net revenue: VND1,053bn (USD41.4mn, -25% QoQ, -28% YoY).
  • NPAT: VND231bn (USD9.1mn, -20% QoQ, -10% YoY).

Weak Q4 and 2024 net revenue was due to a reduction in discounts. In Q4 2024, BMP’s net revenue dropped 25% QoQ and 28% YoY, versus our expectation for seasonally high sales volume growth at the year-end as construction activities pick up. We attribute this sharp drop in the top line to a reduction in promotion programs during Q4, with total discounts – the sum of trade discounts (recorded in SG&A expenses) and payment discounts (recorded in financial expenses) – down 40% QoQ and 54% YoY.  Overall, in 2024, net revenue declined 10% YoY as total discounts dropped 22% YoY, which we view positive as the decline in net revenue was smaller than the decline in discounts.

Margins remained strong in Q4 and 2024. In Q4, GPM edged down QoQ, despite average PVC input prices dropping 4% QoQ in Q4, which we attribute to weak sales volume pushing up the cost per unit in COGS. Nevertheless, quarterly GPM remained solid at 42.9% due to favorable input plastic prices, driven by sluggish construction demand from China. As a side note, 2024 total discount expenses were in line with our expectations, fulfilling 97% of our forecast, with higher-than-expected payment discount expenses offsetting lower-than-expected trade discount expenses.

We observe that BMP pursued a margin maximization strategy throughout 2024. Although BMP's GPM declined QoQ in Q4, NPM improved to 21.9% from 20.6%, driven by a significant reduction in discounts, with total discounts/sales dropping to 9.1% from 11.4%. This underscores BMP's margin-maximization strategy, as observed during Q2 and Q4, when the company minimized discounts to protect margins amid a weak market. Conversely, when necessary, BMP tatically offered short-term discounts, as seen in Q3, which were quickly absorbed by the market. This approach, coupled with favorable input prices, contributed to YoY expansion in GPM and NPM to 43.1% and 21.5%, respectively, despite a high base in 2023. We view BMP as a competitively positioned player with strong pricing power in the southern market, demonstrating flexibility in adjusting discount policies to optimize margins and earnings. This reaffirms our perspective on BMP as a strong defensive stock pick in the construction materials sector for 2025F.

Overall, as 2024 results were in line with our expectations, we currently foresee insignificant changes to our 2025F forecasts.

BMP’s 2024 results

 

Q4 2023

Q3 2024

Q4 2024

QoQ

YoY

2023

2024

YoY

2024F

2024A / 2024F

Net revenue

1,454

1,407

1,053

-25%

-28%

5,157

4,616

-10%

4,553

101%

Gross profit

591

606

452

-25%

-23%

2,116

1,989

-6%

1,987

100%

SG&A expense

-261

-200

-156

-22%

-40%

-783

-676

-14%

-673

100%

Operating profit

330

406

296

-27%

-10%

1,333

1,313

-2%

1,314

100%

  - Financial income

29

20

23

12%

-23%

119

79

-34%

80

98%

  - Financial expenses

-43

-71

-30

-58%

-30%

-146

-162

12%

-118

138%

Net other income/loss

3

8

2

-77%

-31%

1

11

10x

1

11x

EBT

319

362

291

-20%

-9%

1,307

1,241

-5%

1,278

97%

NPAT-MI

257

290

231

-20%

-10%

1,041

991

-5%

1,022

97%

SG&A breakdown

 

 

 

 

 

 

 

 

 

 

Total

261

200

156

-22%

-40%

783

676

-14%

673

100%

Trade discounts

169

88

67

-24%

-60%

509

352

-31%

412

85%

Normalized SG&A*

92

112

88

-21%

-4%

274

324

18%

261

124%

Discounts

 

 

 

 

 

 

 

 

 

 

Total

211

160

96

-40%

-54%

654

511

-22%

530

97%

Trade discount (SG&A)

169

88

67

-24%

-60%

509

352

-31%

412

85%

Payment discount (Fin. Exp.)

42

71

29

-59%

-32%

145

160

10%

118

136%

GPM

40.6%

43.1%

42.9%

 

 

41.0%

43.1%

 

 

 

SG&A/Sales

17.9%

14.2%

14.8%

 

 

15.2%

14.6%

 

 

 

Normalized SG&A/Sales

6.3%

8.0%

8.4%

 

 

5.3%

7.0%

 

 

 

Total discounts**/Sales

14.5%

11.4%

9.1%

 

 

12.7%

11.1%

 

 

 

OPM

22.7%

28.8%

28.1%

 

 

25.9%

28.4%

 

 

 

NPM

17.7%

20.6%

21.9%

 

 

20.2%

21.5%

 

 

 

Source: BMP, Vietcap. *Normalized SG&A is SG&A expenses excluding trade discount. **Total discounts equal the sum of trade discounts and payment discounts.

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