QNS - 14% YoY earnings growth led by strong sugar profit - Earnings Flash
  • 2024-10-24T00:00:00
  • Company Research

  • QNS released its 9M 2024 results with revenue of VND8.1tn (USD323mn; +4% YoY) and NPAT-MI of VND1.8tn (USD70mn; +14% YoY), completing 79% and 81% of our respective full-year forecasts. Revenue was in line with our forecast while earnings tracked ahead of our expectation, driven by sugar profitability that was stronger than we expected. We see upside potential to our current projections, pending a fuller review. 

  • In 9M 2024, the company’s sugar business saw a 3% YoY increase in revenue, driven by a 6% YoY increase in ASP to VND17,000/kg, despite a 3% YoY decline in volume. According to QNS, lower production costs per kilogram, combined with the sugar price remaining at a high level, helped expand the sugar business’s GPM by 4.7 ppts YoY. Other businesses, primarily biomass, experienced robust gross profit growth, benefiting from solid sugarcane bagasse input from the sugar segment.  

  • Additionally, in 9M 2024, soymilk revenue increased 3% YoY due to 5% YoY volume growth, but GPM shrank 2.0 ppts YoY. According to QNS, the decline in profitability was mainly because of (1) a lower ASP to promote the new Veyo nut milk’s SKUs, in addition to (2) higher input material costs. 

  • Apart from the improved profitability of the sugar business, QNS's effective cost management, as evidenced by a 30 bps YoY decline in SG&A/sales, contributed to a 2.1 ppt YoY expansion in EBIT margin during 9M 2024. 

QNS’s Q3 and 9M 2024 results 

 VND bn 

Q3 2023 

Q3 2024 

YoY 

QoQ 

9M 2023 

9M 2024 

YoY 

9M 2024/ Vietcap's 2024F 

Revenue 

2,467 

2,727 

11% 

-3% 

7,749 

8,069 

4% 

79% 

  • Soy milk 

1,128  

1,213 

8% 

2% 

      3,106  

3,187 

3% 

78% 

  • Sugar 

908  

1,041 

15% 

-2% 

       3,127  

3,225 

3% 

81% 

  • Others(1) 

217  

472 

118% 

-18% 

1,515 

1,657 

9% 

80% 

Gross profit 

860  

912 

6% 

-7% 

     2,453  

2,704 

10% 

81% 

  • Soy milk 

460  

470 

2% 

4% 

       1,261  

1,229 

-3% 

76% 

  • Sugar 

312  

350 

12% 

-5% 

         862  

1,042 

21% 

86% 

  • Others(1) 

65  

92 

41% 

-45% 

330 

433 

31% 

86% 

Operating profit 

487  

529 

9% 

-27% 

      1,556  

1,791 

15% 

83% 

PBT 

563  

587 

4% 

-23% 

        1,717  

1,931 

12% 

78% 

NPAT-MI 

506  

532  

5% 

-23% 

      1,535  

      1,754  

14% 

81% 

GPM 

34.9% 

33.4% 

 

 

31.7% 

33.5% 

 

  

Soy milk  

40.8% 

38.8% 

 

 

40.6% 

38.6% 

 

  

Sugar  

34.3% 

33.6% 

 

 

27.6% 

32.3% 

 

  

EBIT margin 

19.7% 

19.4% 

 

 

20.1% 

22.2% 

 

  

NPM 

20.5% 

19.5% 

 

 

19.8% 

21.7% 

  

  

Source: QNS, Vietcap; (1) includes beer, confectionary, mineral water, and biomass power plant 

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