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* H1 2024 results: SAB announced its H1 2024 results with net revenue of VND15.3tn (USD598.8mn; +5% YoY) and NPAT-MI of VND2.2tn (USD88.1mn; +6% YoY). The decline in net revenue YoY in Q2 2024 dampened H1 2024 revenue growth despite strong revenue growth YoY in Q1 2024 (16% YoY growth mainly driven by the different timing of Lunar New Year in 2023 and 2024). However, H1 2024 NPAT-MI growth was mainly supported by the strict control of selling expenses despite SAB realizing high-cost raw materials and recording lower net financial income YoY. The results complete 47% and 50% of our respective full-year forecasts and are in line with our expectations. We thus see no significant risks to our 2024F forecasts, pending a more comprehensive review.
* Q2 2024 results: Net revenue decreased 3% YoY to VND8.1tn (USD317.1mn) in Q2 2024. Beer revenue improved 11% QoQ but still witnessed a YoY drop of 4%. We attribute weak revenue YoY in Q2 2024 to (1) subdued household spending and (2) maintained strict enforcement of drunk driving laws outweighing the positive impacts of a selling price hike in Q1 2024. Additionally, Q2 2024 NPAT-MI increased 8% YoY to VND1.2tn (USD49.0mn), driven by strict control of SG&A expenses despite the realization of high-cost raw materials and lower net financial income YoY.
* Profitability: Beer GPM slightly contracted to 33.8% in H1 2024 from 34.1% in H1 2023, which is mainly due to SAB continuing to realize high-cost raw materials. However, Q2 2024 beer GPM expanded by 1.5 ppts to 34.5% from a low base of 33.0% in Q1 2024. The blended EBIT margin expanded to 15.8% in H1 2024 from 13.7% in H1 2023, which is driven by strict control of SG&A expenses. Advertising & promotional (A&P) expenses/beer revenue declined to 7.7% in H1 2024 vs 9.5% in H1 2023, which is in line with management’s guidance for more selective spending on A&P activities in 2024.
SAB’s Q2 2024 & H1 2024 results
VND bn | Q2 2024 | YoY | H1 2024 | YoY | H1 2024/ Vietcap's 2024F |
Net revenue | 8,086 | -3% | 15,270 | 5% | 47% |
Beer revenue | 7,059 | -4% | 13,446 | 4% | 47% |
Others | 1,028 | 7% | 1,823 | 13% | 46% |
Gross profit | 2,440 | -2% | 4,541 | 3% | 47% |
Beer GP | 2,434 | -4% | 4,544 | 3% | 46% |
Other GP & sales deduction | 6 | N.M. | -3 | 74% | 4% |
Selling expenses | -902 | -23% | -1,744 | -14% | 39% |
G&A expenses | -176 | -12% | -385 | 1% | 45% |
EBIT | 1,362 | 21% | 2,411 | 21% | 55% |
Net financial income | 258 | -23% | 528 | -22% | 43% |
Gain/loss from associates | 28 | -64% | 17 | -87% | 7% |
Net other income | -13 | 14% | -19 | 51% | 55% |
PBT | 1,634 | 7% | 2,937 | 6% | 50% |
NPAT-MI | 1,248 | 8% | 2,246 | 6% | 50% |
Blended GPM | 30.2% | 0.2 ppts | 29.7% | -0.6 ppts |
|
Beer GPM | 34.5% | 0.0 ppts | 33.8% | -0.3 ppts |
|
Blended EBIT margin | 16.8% | 3.4 ppts | 15.8% | 2.1 ppts |
|
EBIT/beer revenue | 19.3% | 4.0 ppts | 17.9% | 2.5 ppts |
|
Blended NPAT-MI margin | 15.4% | 1.5 ppts | 14.7% | 0.1 ppts |
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Source: SAB, Vietcap
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