- 2025-04-28T00:00:00
- Company Research
VRE announced its Q1 2025 results with net revenue of VND2.1tn (flat QoQ and -5.5% YoY) (with 95% from retail leasing and 2% from property sales) and NPAT-MI of VND1.2tn (+8% QoQ and +9% YoY). The YoY drop in Q1 2025 revenue was due to YoY lower property sales recognition, while YoY growth in NPAT-MI was mainly driven by YoY higher financial and other income, and a slight 2% increase in retail leasing gross profit.
Q1 2025 revenue and NPAT-MI complete 24% and 28% of our respective full-year forecasts. We foresee insignificant changes to our 2025F NPAT-MI forecast of VND4.2tn (USD162mn; +3% YoY), pending a fuller review.
Retail leasing segment: The segment saw YoY profit improvements in Q1 2025, supported by a higher average occupancy rate and the absence of bad debt provisions. The segment’s revenue was VND2.0tn (flat QoQ and +5% YoY), gross profit was VND1.2tn (+4% QoQ and +2% YoY), and leasing NOI margin was 73.2% (+5.1 ppts QoQ and +1.1 ppts YoY). The average occupancy rate in Q1 2025 was 86.1%, up 0.7 ppts QoQ and 3.3 ppts YoY, while footfall at VRE’s malls increased 14.4% YoY.
Management guides for the average occupancy rate to reach 87-90% in 2025G vs 84.2% in 2024 and 86.1% in Q1 2025.
Per management, the average same-store rental rate increased 6.3% YoY in Q1 2025, while the average rate across VRE’s all existing malls was flat YoY, reflecting a YoY higher tenant mix in the F&B and entertainment categories, whose rental rates are typically lower than those in the fashion category due to differences in location and size between the two types of stores.
New mall opening plan: For 2025G, management maintains the target to open three new malls with a total of ~120,000 sqm retail GFA, including:
Two VMM malls – Ocean City (Hung Yen, retail GFA of 53,200 sqm) in July and Royal Island (Hai Phong, retail GFA of 47,600 sqm) in Q3 2025G.
One VCP mall – Vinh (Nghe An, retail GFA of 19,000 sqm) in Q4 2025G.
In 2026G, VRE is planning to open at least two new malls for (1) VMM Co Loa in the Global Gate project (Hanoi) and (2) VCP Dan Phuong in Wonder City project (Hanoi).
Property sales segment: In Q1 2025, the segment reported revenue of VND48bn (USD2mn; -20% QoQ and -83% YoY) and gross profit of VND23bn (USD1mn; -67% QoQ and –77% YoY), from delivering 9 shophouses in the quarter (vs 45 units in Q1 2024). The earnings contribution of this segment in 2025G is expected to be lower vs 2024 as VRE delivered most of the shophouse units in previous quarters.
Management plans to launch new presales for commercial components (shophouses) at VHM's Royal Island project in H2 2025G and at Golden Avenue in early 2026G. Handovers for both projects are expected to commence from 2026G, aligning with previous guidance.
VRE’s Q1 2025 results
VND bn | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q1 2025 QoQ | Q1 2025 YoY | 2025F | Q1 as % of 2025F |
Net revenue | 2,255 | 2,479 | 2,078 | 2,128 | 2,131 | 0% | -5% | 9,007 | 24% |
| 1,928 | 1,940 | 1,983 | 2,027 | 2,026 | 0% | 5% | 8,804 | 23% |
| 277 | 467 | 36 | 60 | 48 | -20% | -83% | 203 | 24% |
| 50 | 72 | 59 | 41 | 57 | 40% | 14% | 0 | N.M. |
Gross profit | 1,255 | 1,209 | 1,089 | 1,201 | 1,202 | 0% | -4% | 5,001 | 24% |
| 1,155 | 1,045 | 1,066 | 1,131 | 1,174 | 4% | 2% | 4,929 | 24% |
| 98 | 156 | 16 | 70 | 23 | -67% | -77% | 72 | 32% |
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SG&A expenses | -207 | -216 | -248 | -312 | -173 | -45% | -17% | -727 | 24% |
EBIT | 1,048 | 994 | 842 | 889 | 1,030 | 16% | -2% | 4,274 | 24% |
Financial income | 435 | 420 | 383 | 547 | 625 | 14% | 44% | 1,696 | 37% |
Financial expense | -140 | -179 | -244 | -275 | -243 | -12% | 73% | -647 | 38% |
Other income | 25 | 42 | 138 | 209 | 64 | -69% | 158% | 0 | N.M. |
PBT | 1,367 | 1,277 | 1,119 | 1,370 | 1,476 | 8% | 8% | 5,322 | 28% |
NPAT-MI | 1,083 | 1,021 | 906 | 1,085 | 1,177 | 8% | 9% | 4,205 | 28% |
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Gross margin | 55.7% | 48.8% | 52.4% | 56.5% | 56.4% |
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| 55.5% |
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| 59.9% | 53.9% | 53.7% | 55.8% | 58.0% |
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| 56.0% |
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| 35.3% | 33.5% | 44.2% | 116.1% | 47.1% |
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| 35.3% |
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EBIT margin | 46.5% | 40.1% | 40.5% | 41.8% | 48.3% |
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| 47.4% |
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NPAT-MI margin | 48.0% | 41.2% | 43.6% | 51.0% | 55.2% |
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| 46.7% |
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Source: VRE’s financial statements, Vietcap forecasts (last updated February 21, 2025).
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