- 2025-01-17T00:00:00
- Company Research
- PPC released its Q4 2024 results, with revenue of VND1.8tn (-1% YoY) and reported NPAT-MI of VND178bn (+89% YoY). The decline in revenue is due to to a 3% YoY decrease in sales volume. The surge in reported NPAT-MI is due to (1) improved NPAT from power generation, which increased to VND11bn (vs a net loss of VND38bn in Q4 2023), and (2) a 27% YoY increase in dividend income. The improvement in NPAT from power generation is driven by a 36% YoY decrease in maintenance & other expenses as PPC recorded a majority of its S6 Generator repair costs in 2023. This outweighs the 6% YoY increase in average material costs resulting from higher coal prices .
- For the full year 2024, revenue was VND7.7tn (+32% YoY) and reported NPAT-MI was VND424bn (+12% YoY). We estimate NPAT from power generation at VND99bn, a significant recovery compared to a VND65bn loss in 2023, mainly driven by (1) a 31% YoY increase in sales volume, supported by the re-operation of the S6 generator, which outweighs (2) an estimated 4% YoY rise in average material costs, (3) the lower Pha Lai 1 fixed component, and (4) lower contracted volume ratio of 70% (vs 80% in 2023). However, the 27% YoY decrease in dividend income weighed on reported NPAT-MI growth.
- The 2024 results beat our expectations, achieving 109% and 131% of our revenue and reported NPAT-MI forecasts. The higher-than-expected revenue is due to higher-than-expected sales volume, while the higher-than-expected reported NPAT-MI is due to unexpected dividend income from HND and QTP when they announced dividends in December 2024. However, the 2024 NPAT from power generation fell below our expectations due to higher-than-expected maintenance & other expenses.
- We see insignificant change to our 2025 NPAT forecast, pending a fuller review.
HND (PPC's 27%-stake associate company) reported 2024 NPAT-MI falling below expectations, completing just 70% of our forecast.
- In Q4 2024, HND's revenue was VND2.4tn (-7% YoY), with a loss of VND245mn, marking an improvement from a net loss of VND91bn in Q4 2023. The YoY lower revenue is due to YoY lower sales volume, while the reduced net loss is due to (1) a 58% YoY decline in maintenance & other cash costs driven by some major maintenance contracts that were not completed in 2024, delaying the costs to 2025, (2) along with a 48% YoY reduction in depreciation expenses.
- For the full year 2024, HND’s revenue was VND11.0tn (-4% YoY) and reported NPAT-MI was VND422bn (+1% YoY). The relatively flat reported NPAT-MI is mainly due to (1) a 41% YoY reduction in depreciation expenses, (2) lower maintenance & other expenses, offsetting (3) lower YoY sales volume, and (4) lower GPM due to higher coal costs.
PPC’s 2024 results
VND bn | Q4 2023 | Q4 2024 | YoY | 2023 | 2024 | YoY | % of Vietcap’s 2024F |
Sales volume (million kWh) | 976 | 948 | -3% | 3,150 | 4,138 | 31% | 108% |
Price spread (VND/kWh) | 379 | 167 | -56% | 289 | 239 | -17% | 82% |
ASP (VND/kWh) | 1,814 | 1,694 | -7% | 1,846 | 1,856 | 1% | 101% |
Average material cost (VND/kWh) | 1,435 | 1,527 | 6% | 1,556 | 1,617 | 4% | 104% |
Revenue | 1,770 | 1,750 | -1% | 5,814 | 7,681 | 32% | 109% |
COGS | -1,769 | -1,686 | -5% | -5,777 | -7,451 | 29% | 110% |
- In which, maintenance & other expenses | -297 | -178 | -40% | -617 | -480 | -22% | 119% |
Gross Profit | 1 | 64 | 6316% | 36 | 230 | 531% | 75% |
G&A | -41 | -49 | 19% | -117 | -146 | 25% | 115% |
Operating profit (EBIT) | -40 | 15 | N.M. | -80 | 84 | N.M. | 46% |
Net interest income | 3 | -1 | -138% | 19 | -2 | -110% | -57% |
Dividend income | 132 | 167 | 27% | 445 | 326 | -27% | 184% |
Others | 1 | 0 | -99% | -2 | 27 | N.M. | N.M. |
PBT | 95 | 181 | 89% | 381 | 434 | 14% | 121% |
Income tax exp | -1 | -2 | 117% | -1 | -10 | 827% | 28% |
Reported NPAT | 94 | 178 | 89% | 380 | 424 | 12% | 131% |
NPAT from power generation * | -38 | 11 | N.M. | -65 | 99 | N.M. | 67% |
Source: PPC, Vietcap (*Vietcap estimate NPAT from power generation = Reported NPAT - Dividend income)
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