Vietnam: Sabeco reports highest profit in past seven quarters

Saigon Beer - Alcohol - Beverage Corporation (SABECO) reported a profit of about VND1.32 trillion ($52.8 million) in the second quarter, and a cumulative profit of VND2.34 trillion ($93.6 million) in the first half of 2024, up 5.8 per cent on-year, Vietnam Investment Review reported on August 2.

Along with the economic recovery, SABECO's business results have also gradually shown signs of growth and improvement in business efficiency.

In the second quarter of 2024, SABECO recorded revenue of almost VND8.1 trillion ($324 million), down 2.7 per cent on year, and after-tax profit increased by 9 per cent to VND1.32 trillion ($52.8 million). Of which, the gross profit margin improved from 29.9 to 30.2 per cent. Since the fourth quarter of 2022, $52.8 million in the second quarter of 2024 is the highest profit over the last seven consecutive quarters.

In the second quarter financial report of SABECO, gross profit decreased slightly by 1.9 per cent on year to VND2.44 trillion ($100 million), financial revenue dropped by 24.8 per cent to VND266.34 billion ($10 million), financial expenses declined by 52.2 per cent to VND8.22 billion ($329,000), sales and administrative expenses reduced by 21.1 per cent to VND1.08 trillion ($43.2 million).

Thus, in the second quarter, profit increased by 9 per cent, mainly due to improved gross profit margin and reduced sales and administrative expenses.

In the first half of 2024, SABECO recorded revenue of VND15.27 trillion ($610.8 million), an increase of 5.1 per cent on-year, and after-tax profit of VND2.34 trillion ($93.6 million), up 5.8 per cent on-year.

Explaining the revenue and profit growth in the first half of 2024, SABECO said that net revenue was still higher than in the same period, mainly due to the positive impact of price increases, thanks to an improved economy, despite strict implementation of Decree No.100/2019/ND-CP (on administrative penalties for road traffic offences and rail transport offences), and increasingly fierce competition.

Similarly, net profit was also higher due to lower selling expenses, partially reducing income from interest on deposits and lower profits from joint ventures and associates.

In 2024, SABECO plans to have revenue of VND34.4 trillion ($1.37 billion), up 12.9 per cent and expected after-tax profit of VND4.58 trillion ($183 million), up 7.6 per cent compared to the actual performance in 2023.

Thus, after-tax profit of VND2.34 trillion ($93.6 million) in the first half of 2024, SABECO has completed 51.1 per cent of the annual plan.

In addition to the thriving business, SABECO continues to maintain its cash generation model when the operating cash flow in the first half of 2024 recorded VND2.1 trillion ($84.6 million), much higher than VND957.4 billion ($38.3 million) in the same period last year.

In addition, investment cash flow was positive VND957.9 billion ($38.3 million), while financial cash flow was negative VND2.08 trillion ($83.2 million). The company paid cash dividends to shareholders in the first half of 2024.

As of June 30, SABECO's total assets had increased slightly by 0.3 per cent on-year to VND34.15 trillion ($1.37 billion). Of which, the main assets were cash and short-term financial investments at VND23.36 trillion ($934.4 million), accounting for 68.4 per cent; fixed assets at VND3.77 trillion ($150.8 million), making up 11 per cent; and inventories at VND2.35 trillion ($94 million), accounting for 6.9 per cent.

Regarding asset fluctuations, in the first half of 2024, cash and short-term financial investments continued to increase by 2.5 per cent compared to the beginning of the year, equivalent to a rise of VND577.5 billion ($23 million) to VND23.36 trillion ($934.4 million).

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