DGW - Earnings track ahead of forecast due to higher-than-expected EBIT margin - Earnings Flash
  • 2025-02-03T00:00:00
  • Company Research
  • 2024: Net revenue was VND22.1tn (USD883mn; +17% YoY) and NPAT-MI was VND444bn (USD18mn; +25% YoY), completing 101% and 106% of our respective full-year forecasts. NPAT-MI exceeded our expectations due to a higher-than-expected EBIT margin.
  • Q4 2024: Net revenue grew 21% YoY and NPAT-MI increased 57% YoY. Sales growth was mainly driven by smartphones sales (46% of total sales in Q4) as it increased 22% YoY (+20% QoQ), mainly driven by DGW’s strong growth of Xiaomi and iPhone smartphones. Office equipment sales (23% of total sales) and home appliance sales (6% of total revenue) respectively increased 22% YoY and 56% YoY. Consumer goods (5% of total revenue) grew 38% YoY, mainly driven by ABInBev’s sales as DGW started to distribute ABInBev products in HORECA channels in late Q3 2024. Laptop sales (20% of total sales in Q4) grew +7% YoY.
  • Profitability: EBIT margin improved by 20 bps YoY to 2.4% in 2024. In Q4, EBIT margin improved 140 bps YoY and QoQ, slightly tracking ahead of our expectation. 2024 GPM was beat our expectation by 30 bps.
  • Our view: While profitability was ahead of our forecast, we see no material changes to our 2025F forecast as we currently expect GPM and the EBIT margin to improve 10 bps and 20 bps YoY to 9.4% and 2.6%, respectively.

DGW’s Q4 and 2024 results

VND bn

Q4 2023

Q4 2024

YoY

2023

2024A

YoY

2024F

2024A as % of 2024F

Net revenue

4,849

5,859

21%

18,817

22,078

17%

21,948

101%

  • Laptops & tablets

1,072

1,144

7%

5,906

6,279

6%

6,319

99%

  • Mobile phones

2,204

2,687

22%

8,067

9,580

19%

9,671

99%

  • Office equipment

1,124

1,367

22%

3,441

4,386

27%

4,289

102%

  • Home appliances

234

364

56%

728

993

36%

866

115%

  • Consumer goods

215

297

38%

676

840

24%

803

105%

 

 

 

 

 

 

 

 

 

Gross profit

521

608

17%

1,559

2,055

32%

1,976

104%

SG&A expenses

-435

-421

-3%

-1,142

-1,529

34%

-1,478

103%

EBIT

86

186

116%

417

526

26%

498

106%

Net financial income/ loss

38

-11

-0.3x

56

29

-49%

53

55%

  • Financial income

66

56

-16%

195

192

-2%

179

107%

  • Financial loss

-28

-67

139%

-138

-163

18%

-127

129%

NPAT-MI

90

140

57%

354

444

25%

419

106%

Gross margin

10.7%

10.4%

 

8.3%

9.3%

 

9.0%

 

SG&A/net sales

9.0%

7.2%

 

6.1%

6.9%

 

6.7%

 

EBIT margin

1.8%

3.2%


2.2%

2.4%

 

2.3%

 

NPAT-MI margin

1.8%

2.4%

 

1.9%

2.0%

 

1.9%

 

Source: DGW, Vietcap

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