PC1 - 2024 core NPAT slightly trails forecast; power construction GPM doubles QoQ - Earnings Flash
  • 2025-02-03T00:00:00
  • Company Research

*2024: Revenue was VND10.1tn (USD397mn, +31% YoY, 96% of our full-year forecast), with reported NPAT-MI of VND460bn (USD18mn, 13x YoY, 88% of our full-year forecast).

- Revenue grew across major segments, including in (1) power construction and steel poles, (2) the nickel business (2.7x YoY), driven by estimated 1.9x YoY higher raw nickel sales volume, and (3) higher hydropower output due to more favorable weather conditions. 

- Reported/core NPAT-MI surged 13x/6x YoY from low bases, due to (1) 1.8-ppts blended GPM expansion (driven by significant improvement in the nickel business by 15.3-ppts to 32.5%, possibly due to potentially more efficient operations and higher volume, while ASP declined YoY, and (2) YoY stronger hydropower. 

- Reported/core NPAT-MI trailed our forecasts with 88%/93% completion rates due to (1) higher-than-expected G&A expenses and (2) lower-than-expected income from JVs following underperforming land sales from the Yen Phong 2A IP, (3) a higher-than-expected FX loss, and (4) lower-than-expected GPM of the power construction segment.

*Q4 2024: Revenue was VND2,540bn (USD100mn, -1% YoY), NPAT-MI was VND60bn (USD2.4mn, +81% YoY), and core NPAT-MI was VND146bn, 4.5x YoY.

- Blended GPM expanded YoY notably by 8.0 ppts to 23.3%, driven by (1) strong margin recovery from power construction to 8.5% (also x2 QoQ, after a low level in Q3 due to transmission line 3’s tight deadline), and (2) 53.7% GPM from nickel vs losses in Q4 2023. These together outweighed FX losses of VND108bn vs none in Q4 2023. 

* We see slight downside risk to our 2025F core NPAT-MI (VND878bn, USD35mn, +49% YoY) due to slightly lower-than-expected GPM recovery of power construction (averaged 7% in 2024 vs our forecast of 7.4%) and higher-than-expected SG&A expenses, pending a fuller review. We currently have a BUY rating for PC1 with a target price of VND31,200/share. 

*Note: PC1 released its Q4 2024 financial statements, including retrospective adjustments to Q4 2023 and year-end 2023 figures for its nickel mining business. These adjustments account for VAT, discrepancies between actual and estimated nickel revenue, and the environmental resource tax as stated in its H1 audited report. Consequently, we revise the Q4 2023 and 2023 results in our analysis.

 

PC1’s 2024 results

 

VND bn

Q4 2023

Q4 2024

YoY

2023

2024

YoY

 % of Vietcap’s 2024

Revenue

2,554

2,540

-1%

7,694

10,078

31%

96%

Power construction* 

1,126

1,230

9%

2,607

3,686

41%

97%

Electric steel pole manufacturing

421

227

-46%

1,166

1,456

25%

91%

Power generation

414

510

23%

1,461

1,706

17%

103%

Real estate

133

13

-90%

187

39

-79%

142%

Nickel (57% stake)

84

270

223%

624

1,701

173%

93%

Nomura (70% stake)

140

156

12%

614

599

-2%

97%

Others

235

135

-43%

1,034

890

-14%

87%

Gross profit

392

593

51%

1,448

2,083

44%

96%

Power construction* 

64

87

36%

235

258

10%

92%

Electric steel pole manufacturing

45

32

-29%

117

144

23%

99%

Power generation

223

317

42%

736

948

29%

97%

Real estate

53

7

-88%

79

21

-74%

112%

Nickel (57% stake)

-21

118

N.M.

107

553

415%

100%

Nomura (70% stake)

22

31

43%

139

149

7%

97%

Others

7

2

-72%

34

11

-68%

34%

SG&A expense

-136

-211

56%

-391

-567

45%

106%

Operating income

257

382

49%

1,057

1,516

43%

93%

Financial income

46

63

36%

183

186

2%

162%

Financial expense

-202

-294

-109%

-967

-929

-4%

102%

In which: Interest expense

-209

-182

40%

-848

-749

-12%

93%

In which: FX loss & others

0

-108

N.M.

-119

-159

34%

149%

Income from JVs

4

-5

N.M.

2

46

2785%

43%

Other income

-4

15

N.M.

-18

11

N.M.

N.M.

PBT

100

161

61%

256

829

224%

89%

NPAT before MI

89

124

40%

182

704

287%

89%

Minority interest

-56

-64

16%

-145

-243

67%

93%

Reported NPAT-MI

33

60

81%

36

460

1169%

88%

NPAT-MI (core)**

33

146

342%

100

588

489%

93%

Source: PC1, Vietcap (* Power-related construction segment includes grid erection & installing activities and EPC contracts for renewable energy projects. Others mainly include low-margin machinery trading; ** Excluding one-off gains and unrealized FX losses)

Powered by Froala Editor