DGC released strong Q3 2022 results; however, they trailed our expectation. In Q3 2022, DGC recorded revenue of VND3.7tn (USD151mn; +75% YoY & -8% QoQ) and NPAT-MI of VND1.4tn (USD58mn; +196% YoY & -21% QoQ). DGC’s 9M 2022 revenue increased 86% YoY — achieving 73% of our 2022F — and its NPAT-MI surged 318% YoY — completing 72% of our 2022F.

Unlike our expectation, the QoQ decline in Q3 2022 earnings was due to lower P4 sales volume rather than lower P4 ASP. While DGC conducted maintenance on its P4 equipment, its P4 ASP remained nearly flat QoQ, not yet reflecting weakened P4 prices.

DGC shifted its product mix toward thermal phosphoric acid (TPA) — a downstream derivative of P4. TPA prices rallied and the product began to generate unit profits on par with P4 in Q3 2022.