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Quang Ngai Sugar (QNS VN) – Q1 2025 – Plant-Based Drinks Offset Sugar Sales Slump
Summary of Q1 2025 results and outlook of Quang Ngai Sugar JSC (QNS VN)
- Net revenue declined 6.8% y/y to VND2,351bn, as high growth in nuts and soymilk and biomass was offset by weaker sugar sales. Nut and soymilk sales grew 20.0% y/y to VND947bn, driven by volume growth (+10.6%) and a 7.3% rise in average selling price driven by a higher mix of nut-based drinks, which are priced above soymilk. Growth was supported by its wider presence in the modern trade channel, nut-based drinks getting more consumers’ acceptance, and intensified promotions. On the other hand, sugar sales fell 34.7% y/y to VND734bn with volume down 32.0% y/y to 32,640 tons and pricing 4.0% lower. In Q4/2024, global sugar prices dropped 13.6% meanwhile local prices edged down just 2.0%, widening a price gap with tariff-free imports from Laos and Cambodia. Limited local output at the start of the crushing season (November) led local importer prioritizes tariff-free sugar from these countries during Q4/2024 and Q1/2025. However, as supply from Laos and Cambodia remains constrained (with est. 150,000 tons exportable volume, equivalent to only 6.0% of Vietnam’s demand) and local output rises—offering competitive prices against Thai imports (which face tariffs)—domestic sugar, including QNS’s, is expected to see higher sales in the coming quarters. Currently local sugar meets just 46.2% of national demand.
- Net profit declined 26.4% y/y to VND392bn. The increased selling costs were driven by intensified promotions for traditional distributors and consumers, as other F&B firms such as Vinamilk and TH True Milk are also increasing their offering of plant-based milk products. While the gross margin improved slightly (from 32.0% to 32.5%), it was insufficient to offset the higher SG&A costs. Lower net financial income from falling deposit rates also weighed on profitability.
- For the rest of 2025, net sales are forecast to rise year-over-year, driven by stable nut & soymilk sales and high sugar growth. Nut & Soymilk: Demand benefits from rising incomes and shifting consumer preferences toward plant-based drinks. QNS competitively positioned through lower-price offerings than imports and local competitors’ products. Net sales are expected to rise in line with a ~5.0% industry average. Sugar: with low-cost imports from Laos and Cambodia dwindling and the production season concluded, sales will be driven by RS sugar in inventory and RE refined from imported raw sugar.
Interested in QNS? Click here to read more of our previous analysis on QNS’s quarterly earnings.
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