PPC - Weak Q1 results on lower volume, no dividend income

PPC reported Q1 2025 revenue of VND1.5tn (-23% YoY) and reported NPAT-MI of VND52bn (-67% YoY). The sharp decline in reported NPAT-MI was mainly due to (1) a 17% YoY decrease in NPAT from power generation and (2) no dividend income in Q1 2025 (vs VND94bn in Q1 2024).
The YoY decline in NPAT from power generation was primarily driven by a higher effective tax rate. The income tax expense normalized to an effective rate of 20% in Q1 2025, compared to just 1% in Q1 2024 (as PPC carried forward tax losses from Q4 2023). While the price spread expanded due to a 1% increase in ASP (which we attribute to a 23% higher fixed component of the PPA price for Pha Lai 1), the 24% drop in sales volume significantly dragged down gross profit, which fell 1% YoY.
We see downside risk to our full-year earnings forecast, as Q1 revenue and reported NPAT are equivalent to 17% and 11% of our 2025 forecasts, respectively. The Q1 NPAT from power generation is equivalent to 15% of our 2025 forecast. The lower-than-expected NPAT is mainly due to lower-than-expected sales volume and lower-than-expected ASP, given that the industry CGM price in Q1 2025 averaged VND1,247/kWh (-17% YoY).

PPC’s Q1 2025 results

VND bn	Q1 2024	Q1 2025	YoY %	% of Vietcap’s 2025F
Sales volume (million kWh)	1,125	855	-24%	19%
Price spread (VND/kWh)	239	261	9%	80%
ASP (VND/kWh)	1,775	1,797	1%	89%
Average material cost (VND/kWh)	1,536	1,536	0%	91%
Revenue	1,996	1,536	-23%	17%
COGS	-1,901	-1,441	-24%	17%
- In which, maintenance & other expenses	-101	-70	-31%	17%
Gross Profit	95	95	-1%	16%
G&A	-31	-29	-7%	18%
Operating profit (EBIT)	64	66	3%	15%
Net interest income	1	0	-97%	1%
Dividend income	94	0	-100%	0%
Others	0	0	-172%	N.M.
PBT	159	65	-59%	11%
Income tax exp	-2	-13	529%	15%
Reported NPAT	157	52	-67%	11%
NPAT from power generation *	63	52	-17%	15%

Source: PPC, Vietcap (*Vietcap estimates NPAT from power generation = Reported NPAT - Dividend income)