Company Quarterly Earnings Update – BWE VN – Q1 2022

Summary of the Q1/2022 results of Binh Duong Water Environment  JSC (BWE VN)

Q1/2022 result highlights

  • BWE’s net revenue increased by 8.6% y/y to VND733bn as its main business line – water supply, posted a same growth pace of 8.6% y/y. The total water volume advanced by 4.4% y/y to 42 million m3, while the water selling price was up by 4.8% y/y. Operating profit increased by 25.9% y/y thanks to a better operating margin. However, the company reported a net financial expense instead of net financial income in the same period last year. As a result, net profit increased by a mere 2.6% y/y to VND177bn.
  • The balance sheet structure remained unchanged since the end of last year. Cash & short-term investment accounted for 11.4% of total assets. Financial leveraging was moderate with a D/E ratio of 0.89x.
  • In April 2022, BWE completed the investment at two new affiliates including a 24.6% ownership at Can Tho Water company and a 48.9% stake at Can Tho Water 2. The total transaction value was estimated at around VND300bn. These two investments will generate an income of around VND20bn for BWE annually. Despite a small contribution to the bottom line, such investments offer BWE good opportunities to expand business in Can Tho city and the nearby area in the south-west of Vietnam.
  • Regarding water selling prices for 2023-2026, the company is finalizing documents with the Binh Duong provincial authority and there has been no final decision as of yet. However, the recently approved price scheme for the nearby province – Binh Phuoc could be very positive for BWE to use in negotiations with authorities. Over the last five years, water prices in Binh Duong and Binh Phuoc were regulated to increase at the same pace. In May, water prices in Binh Phuoc were approved to increase on average VND600-1,000/m3 per annum over 2023-2026.


  • We maintain our positive outlook for water demand in Binh Duong province thanks to rising demand from industrial clients and solid organic growth from residential customers. With its new capacity, BWE is running at around 65-70% of its total capacity, giving the company significant room for growth. The company’s operation is stable, and its Q1/2022 result was on track with our projection. Thus, we maintain our forecasts relatively unchanged in this report. We expect 2022’s net profit to expand by 10.3% y/y to reach VND820bn, with 2023’s net profit to increase by 21.6% y/y to VND997bn.


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