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Full-year results:
- Net revenue: VND1,037bn (USD40.7mn; +47% YoY; 103% of our 2024F forecast) – in line with our projection.
- NPAT-MI: VND693bn (USD27.2mn; +39% YoY; 95% of our 2024F forecast) – slightly weaker than we expected.
Q4 results:
- Net revenue: VND294bn (USD11.5mn; +48% YoY, +11% QoQ).
- NPAT-MI: VND170bn (USD6.7mn; +33% YoY, -8% QoQ).
Strong volume growth in Q4 and full-year 2024:
- Full-year results: Total cargo throughput: 267,400 tonnes (+41% YoY; 101% of our full-year forecast)
- International cargo: 205,150 tonnes (+50% YoY; 102% of our full-year forecast).
- Domestic cargo of 63,250 tonnes (+18% YoY; 98% of our full-year forecast).
- Q4 results: Total cargo throughput: 73,100 tonnes (+11% QoQ; +37% YoY)
- International cargo: 57,600 tonnes (+11% QoQ; +47% YoY).
- Domestic cargo: 15,400 tonnes (+13% QoQ; +8% YoY).
For the full year, we attribute the strong YoY increase in 2024 cargo throughput to (1) trade recovery from 2023’s low base, (2) SCS gaining Qatar Airways as a new client, and (3) higher sea freight rates and regional seaport congestion, especially during H1 2024, which boosted the relative attractiveness of air cargo. Within Q4, we attribute strong QoQ growth in throughput to the year-end high season for trading activities.
Low Q4 margins due to high salary expenses:
In Q4, SG&A expenses surged nearly 90% QoQ and 80% YoY, and COGS increased around 60% both QoQ and YoY. We think the strong YoY increase was due to YoY stronger throughput, while the QoQ increase, in our view, can be attributed to year-end salary bonuses which boosted SG&A expenses and the salary component of COGS.
Overall, total labor costs increased nearly 140% QoQ and 100% YoY in Q4 2024, and ~50% YoY for full-year 2024. As can be seen in Figure 2, salary expenses are the largest component, making up ~45% of total SG&A and COGS expenses. This higher cost reduced Q4 profitability, leading to full-year NPAT-MI falling slightly short of our projections despite in-line net revenue results.
Overall, we see no material changes to our forecasts, pending a fuller review.
Figure 1: SCS’s 2024 results
Unit: VNDbn | Q4 2023 | Q3 2024 | Q4 2024 | QoQ | YoY | 2023 | 2024 | YoY | 2024F | 2024 vs 2024F |
Cargo volume (tonnes) | 53,414 | 65,568 | 73,070 | 11% | 37% | 189,829 | 267,368 | 41% | 264,815 | 101% |
International | 39,173 | 51,871 | 57,632 | 11% | 47% | 137,110 | 205,140 | 50% | 201,552 | 102% |
Domestic | 14,241 | 13,697 | 15,438 | 13% | 8% | 52,719 | 62,228 | 18% | 63,263 | 98% |
ASP (VND/Kg) | 3,380 | 3,800 | 3,788 | 0% | 12% | 3,404 | 3,627 | 7% | 3,566 | 102% |
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Net revenue | 199 | 266 | 294 | 11% | 48% | 705 | 1,037 | 47% | 1,009 | 103% |
Air cargo terminal | 181 | 249 | 277 | 11% | 53% | 646 | 970 | 50% | 944 | 103% |
Others | 18 | 17 | 17 | 3% | -5% | 59 | 67 | 14% | 64 | 105% |
COGS | 54 | 53 | 87 | 64% | 60% | 170 | 236 | 39% | 192 | 122% |
Gross Profit | 144 | 213 | 207 | -3% | 43% | 535 | 801 | 50% | 816 | 98% |
SG&A | 16 | 15 | 29 | 87% | 79% | 52 | 71 | 38% | 58 | 123% |
Operating Profit | 128 | 198 | 178 | -10% | 39% | 484 | 730 | 51% | 758 | 96% |
Financial income | 18 | 12 | 14 | 17% | -23% | 88 | 55 | -37% | 55 | 100% |
PBT | 146 | 209 | 192 | -8% | 31% | 571 | 785 | 37% | 813 | 97% |
CIT | -18 | -23 | -22 | -7% | 23% | -73 | -92 | 27% | -85 | 108% |
NPAT-MI | 128 | 186 | 170 | -8% | 33% | 498 | 693 | 39% | 728 | 95% |
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GPM | 72.6% | 80.0% | 70.4% |
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| 75.9% | 77.2% |
| 80.9% |
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SG&A | 8.0% | 5.7% | 9.7% |
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| 7.3% | 6.9% |
| 5.7% |
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OPM | 64.6% | 74.3% | 60.7% |
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| 68.6% | 70.4% |
| 75.1% |
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NPM | 64.6% | 69.9% | 57.9% |
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| 70.7% | 66.8% |
| 72.1% |
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Source: SCS, Vietcap
Figure 2: SCS’s SG&A + COGS breakdown
Unit: VNDbn | Q4 2023 | Q3 2024 | Q4 2024 | QoQ | YoY | 2023 | 2024 | YoY |
Labor | 34 | 28 | 66 | 137% | 96% | 94 | 142 | 51% |
Materials, office | 1 | 2 | 2 | 35% | 73% | 4 | 6 | 44% |
Depreciation | 11 | 11 | 12 | 1% | 6% | 44 | 45 | 2% |
Outsourcing | 20 | 22 | 28 | 26% | 38% | 65 | 93 | 43% |
Others | 4 | 5 | 8 | 47% | 88% | 14 | 21 | 50% |
Total | 71 | 68 | 116 | 69% | 64% | 221 | 307 | 39% |
Source: SCS, Vietcap
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