PGS – 2016 prospects with CNG divestment story

In 2016, PGS maintained the level of total output with ~235,000 tons of LPG (equaled to last year) and ~88 million m3 of CNG (+3.88% yoy). However, business result from PGS has not made any spectacular improvement due to the pressure from global crude market. For the whole year, revenue and profit after tax of the company both recorded a deterioration with negative growth rates, VND 5,952.76 billion (-21.04% yoy) and VND 112.89 billion (-17.40% yoy).

2015 non-life insurance sector overview: Double digit growth, stable loss ratio

After experiencing four consecutive years of declining from 2010 to 2013, the insurance market’s gross premium returned to positive growth in 2014. That recovery was attributed to the recovery of the overall economy and efforts to restructure operation of non-life insurance companies themselves. The MOF has estimates non-life insurance sector could record a 15% growth y-o-y by the end of 2015, equal to VND31,500 billion

Oil prices surged – psychological factors positively affected oil & gas stocks

Ending trading session on 24/01/2016 in ICE and NYMEX, future contract prices for Brent and WTI increased significantly to USD32.18/barrel and USD32.19/barrel respectively. The rates achieved 8.26% and 9.11% compared to last session. It pulled the crude prices out of the lowest level in 12 years which have maintained for a week (18 – 22/01).

NT2: Double advantages bring positive result in 2015

NT2 released its Q42015’s financial statements with acceptable performance. Accordingly, the fourth quarterly’s revenue and profit-after-tax (PAT) were VND1,708.3 bn (-4.1%, yoy) and c. VND450 bn (+26%, yoy) respectively. We would like to remind that from Sep 2015 natural gas price paid to Vietnam Petro Gas will be floated, instead of fixed-price as previous years. Due to natural gas market price has been lower than contracted price, Q42015’s sales were lower.

MAC – Which direction is right?

Maserco JSC (MAC-HNX) announced the 4Q earnings result late yesterday with revenue and PAT recording VND38.1 (+39% yoy) and VND5.04 (+45.6% yoy). So, for FY2015, the firm has seen impressive growth in PAT to VND14.4 billion (a 2.8 times growth to 2014's result) and 24% rise in revenue to VND135 billion.

LCG – Potential not yet confirmed by business performance

Yesterday, our analyst attended an analyst meeting of Licogi 16 JSC (HSX – LCG), where the Company revealed its business results for FY2015 as well as the guidance for FY2016. In the nine months to September, LCG reported VND45bn of net income, 100% of the annual NPAT guidance. However, the firm said it made only a third of that number for the whole year of 2015. The stock of LCG lost over 13% over the past 5 days.

DHA, KSB earnings update - Keep on growing

The fourth-quarter earnings season is about to pick off. Like many other listed enterprises, Hoa An JSC has just unveiled its over-expected performance in 2015. Accordingly, 2015’s revenues were VND201.51 billion, an increase of 17.8% compared to FY2014; net income rose significantly 190% to VND44.37 billion. If excluding extraordinary profit from the transfer Thuong Tan mine, the adjusted profit still climbed 155.1%. The positive earnings came from (1) consumption volume climbed 10.3% compared with FY2014, (2) the average selling price added 7% and (3) the Company tightened its control policy to avoid losses and enhance production efficiency.

GAS - Preliminary estimated results for 2015 and 2016 prospects

Today (22/1/2016), Rongviet Research participated in the analyst meeting hosted by PetroVietnam Gas Corporation (GAS – HSX).

In 2015, under the negative pressure from global crude oil prices, GAS achieved pessimistic business results with revenue and profit before tax at 63,454 billion (-13.84% yoy) and 11.220 billion (-37.64% yoy) respectively

DGW - 2015 Earnings updates

2015’s performance was not as expected due to sudden drop in Nokia’s revenue. Total revenue of 2015 was only VND 4,208 billion, 14% lower than 2014’s figure and only 78% his guidance. This poor result was mainly due to external factor, which come from Nokia’s strategy. Nokia’s revenue in 2014 accounted for over 50% total revenue of DGW. However, in 2015, Nokia changed his business strategy to focus on software development, instead of manufacturing devices as previous years. Therefore, there was less new Nokia cell phone models introduced to customers and his products also become less attractive to customers in Vietnam. As a consequence, DGW get trouble in generating revenue by distributing Nokia’s products. Moreover, in DGW’s 2016 guidance, he also did not account for Nokia revenue in his business plan.

DHC recorded sweet figure in 2015

According to Q4/2015 DHC performance report published today, revenue and PAT reached respectively VND 172,7 billion and 27,5 billion, increased by 13.2% and 188.3% yoy. The positive result came from (1) an increase in revenue when carton packaging demand grew significantly, (2) an improvement in gross margin thanks to proactive BOM management when storing OCC in the low-price period (~USD 170/ton, compared with ~USD 200/ton in peak period) (3) getting preferential treatment in corporation income tax, which was recently approved by the General Department of Taxation. Currently, the tax of kraft manufacture plant was exempt while tax of box making plant was reduced 50% in 2015. Thus, in 2015, DHC only had to pay VND 6.3 billion, equivalents to tax rate of 7.6% (compare with 2014 tax rate of 22%)

PAC – Brighter prospect ahead

Recently, RongViet Research just had a chance to meet with representative of Dry Cell and Storage Battery JSC (PAC–HSX) and discuss the 2015 earnings result and 2016 annual targets. Specifically, in terms of 2015, PAC recorded revenue and NPBT at VND 2.253 bn (+11% y-o-y) and VND 123 bn (+28% y-o-y) respectively, equivalent to EPS at 3,096 dong. PAC can achieve such positive earnings result thanks to (1) The automobile storage battery recorded positive earnings result since automobile market had a remarkable sale volume figure in 2015; particularly, Thaco and Ford, two biggest customers of PAC, both recorded two digit growth rate in sale volume, (2) Material Input (Lead, Zinc) considerably decreased as China’s Economy slows (estimated lead prices in 2015 is equal to 1,789 USD per ton), (3) Profit from dry cell segment is slightly enhanced since PAC switched their material suppliers; this segment currently contributes about 12% in total revenue.

DHG-Need more solid basis

Today DHG has just published 4Q2015 business result in which revenue and NPBT reached VND1,150 billion (-12% yoy) and VND192 billion (-6.5% yoy). In 2015, revenue recorded VND3,609 billion (-7% yoy) and NPBT was VND704 billion (-2.5%). To compare with the 2015 target, DHG only accomplished 90% of revenue and 96% of NPBT.  However, thanks to tax incentives of about VND44 billion, NPAT still rose by 11%, reaching VND594 billion. EPS was about 6,800 VND/share, equivalent to P/E trailing at 9x.