Company Quarterly Earnings Update – QNS VN – Q1 2022

Summary of the Q1/2022 results of Quang Ngai Sugar JSC (QNS VN)

Q1/2022 Results: Highlights

  • Net revenue and net profit grew by 10.6% y/y (to VND1,813bn) and 9.4% y/y (to VND176bn), respectively.
  • Soy milk (making up 49.2% of revenue and 73.8% of gross profit): Revenue jumped by 23.0% y/y to reach VND892bn. The main drivers are (1) a 14% rise in sales volumes to 53.4 mn liters thanks to consumer’s transition to affordable products (dominated by QNS) resulting in its higher market share of 89.2% (vs 88.0% in Q1/2021), (2) a 6-8% hike in average selling prices (ASPs) to mitigate the impact of high input material prices. It is very attractive to witness a double-digit growth in volume despite a hike in ASPs backed by new products (low-sugar, new flavor soymilks).
  • Sugar segment: Revenue rose slightly by 1.8% y/y to VND416bn, making up 9% of the total, specifically: (1) the sales volume declined by 17% y/y to 21,000 tons due to a significant rise in imported sugar (transshipments from Thailand to 5 Asian countries for export to Vietnam), (2) the ASP went up 19% y/y due to an upswing in global prices. Others (biomass, confectionary, mineral water, etc.) posted flat revenue growth.

Outlook 2022-2023

  • For 2022: In the last 9M, soymilk revenue is expected to climb by double digits thanks to a strong rebound in the FMCG sector across all distribution channels from the low base of last year during the lockdown. Furthermore, QNS launched new nut-based yogurt drink products (made from 5 non-GMO types of beans/nuts), which will be a new catalyst for the upcoming quarters. For sugar, the expected sales volume is 150,000 tons, lower than our latest forecast, due to significant impacts of imported sugar in Q1. Therefore, we lower our revenue and net profit forecast by 2.8% and 4.0%, respectively, to VND9,379bn (+27.9% y/y) and VND1,432bn (+15.3% y/y).
  • For 2023: Soymilk revenue is expected to rise 6.7% y/y (better than the industry growth of 4%) thanks to: (1) a higher contribution of nut-based yogurt drink products, and (2) QNS’s soymilk is consumed widely by the Japanese market, with revenue from this market predicted to jump dramatically from 2023 onwards. Sugar sales are projected to jump 29.4% y/y due to (1) a 20.7% growth in RS sales volume due to a robust expansion of the sugarcane area, and (2) a greater contribution of RE sugar backed by local supply shortfall. Therefore, we expect revenue and net profit to rise by 13.5% y/y and 10.3% y/y, respectively, to VND10,649bn and VND1,579bn.


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