- 2025-01-25T00:00:00
- Company Research
2024: Revenue was VND13.5tn (USD531mn, -1% YoY, 94% of our full-year forecast) and NPAT-MI was VND594bn (USD23mn, +14% YoY, 99% of our full-year forecast). Revenue was behind our forecast due to lower-than-expected imported trading good sales of VND1.5tn (vs our projection of VND2.1tn). We attribute the 14% YoY NPAT-MI growth, despite nearly flat YoY revenue, to a 43% YoY increase in EBIT, which offset the decline in financial income. Strong EBIT growth came from: (1) 2% YoY lower gas prices (driven by the lower contribution from expensive gas fields while fuel oil prices increased 3% YoY), (2) a slight uptick in estimated urea ASP (+2% YoY), and (3) slight urea sales volume expansion (+2% YoY).
Q4 2024: Revenue was VND3,164bn (USD125mn, -6% YoY) and NPAT-MI was VND36bn (USD1.4mn, -66% YoY).
The YoY revenue decline was due to (1) 5% YoY lower urea ASP and (2) an estimated YoY decline in NPK ASP; these together outweigh (3) slightly higher urea sales volume (+1% YoY) and our estimate of higher NPK sales volume.
NPAT-MI plunged 66% YoY due to (1) 36% YoY higher G&A expenses, driven by VND50bn research & development expenses, and (2) lower interest income. These outweigh 2.59-ppts GPM expansion to 12.4% due to lower gas prices (-2% YoY).
2025 guidance:
Urea sales volume of 800,000 tonnes (-8% YoY, 100% of our 2025F forecast), reflecting expected maintenance of ~30 days in 2025F.
NPK sales volume of 175,000 tonnes (+22% vs 2024G, 93% of our 2025F forecast), implying further sales volume expansion (similar to DCM’s 2025 guidance).
Revenue of VND12.9tn (USD507mn, +1% YoY vs 2024G, 96% of our 2025F forecast) and NPAT of VND320bn (USD13mn, -41% YoY vs 2024G, 38% of our 2025F forecast). We attribute the conservative 2025G NPAT to (1) urea sales volume declining YoY (in line), (2) YoY flat gas & Brent oil price assumptions (vs our projection for -4% YoY due to projected falling Brent oil prices), and (3) the guidance excluding gains from the 5% VAT law.
We see insignificant change to our 2025F NPAT-MI projection (VND826bn, USD33mn, +37% YoY) due to our expectation for YoY lower gas prices and VAT gains to drive earnings growth. See more in our January Update.
We currently have an OUTPERFORM rating for DPM with a target price of VND36,800/share.
DPM’s 2024 results
VND bn | Q4 2023 | Q4 2024 | % YoY | 2023 | 2024 | % YoY | % of Vietcap’s 2024F |
Input gas price (USD/MMBTU), including VAT* | 10.8 | 10.6 | -2% | 11.0 | 10.8 | -2% | 100% |
Urea average selling price (VND/kg)* | 9,937 | 9,400 | -5% | 9,398 | 9,576 | 2% | 100% |
Total urea sales volume (thousand tonnes)* | 188 | 190 | 1% | 879 | 900 | 2% | 100% |
Revenue | 3,382 | 3,164 | -6% | 13,569 | 13,496 | -1% | 94% |
COGS | -3,050 | -2,771 | -9% | -11,917 | -11,598 | -3% | 94% |
Gross profit | 332 | 393 | 18% | 1,652 | 1,898 | 15% | 100% |
Sales & marketing exp | -228 | -222 | -3% | -848 | -872 | 3% | 105% |
General admin (GA) exp | -150 | -203 | 36% | -502 | -594 | 18% | 122% |
Operating profit (EBIT) | -45 | -32 | -29% | 301 | 432 | 43% | 74% |
Financial income | 175 | 130 | -26% | 458 | 369 | -19% | 138% |
Financial expenses | -13 | -31 | 142% | -71 | -65 | -9% | 303% |
In which, interest expense | -4 | -26 | 486% | -51 | -48 | -6% | N.M. |
Net other income/loss | -3 | 2 | N.M. | 4 | 4 | 24% | -5% |
Profit before tax (PBT) | 114 | 70 | -39% | 691 | 743 | 8% | 101% |
Income tax expense | -7 | -29 | 307% | -161 | -132 | -18% | -18% |
NPAT | 107 | 41 | -62% | 530 | 610 | 15% | 100% |
Minority interests | 1 | -4 | N.M. | -10 | -17 | 60% | 271% |
Rerpoted NPAT-MI | 108 | 36 | -66% | 519 | 594 | 14% | 99% |
EBITDA | 58 | 63 | 10% | 704 | 822 | 17% | 84% |
| Q4 2023 | Q4 2024 | ppt Δ | 2023 | 2024 | ppt Δ |
|
Gross profit margin | 9.8% | 12.4% | 2.59 | 12.2% | 14.1% | 1.89 |
|
Source: DPM, Vietcap (* Vietcap estimate)
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