Listed companies record 33% rise in Q1 net profit

Net profits of listed companies on the three Vietnamese exchanges rose 33.2% year-on-year in the first quarter of 2022, according to top broker VnDirect Securities.

A company report for Q1/2022 shows that the banking, chemical, and food sectors were growth drivers, contributing 21% to the entire market’s profit growth.

Listed bank net profits jumped by 31.7% in the period, accounting for 12.3% of the market's total. However, excluding VPBank's (HoSE: VPB) unusual income, the group's earnings only climbed by 20%.

The chemical sector recorded net profit growth of 304.1%, with the major contributors being DPM, DCM, and DGC. Higher fertilizer and phosphate prices accounted for the outstanding net profit improvement.

Food corporations witnessed a 44.5% increase in net profit, much higher than the growth rate of 13.8% in Q1/2021.

Net profits from the utility services surged by 52% year-on-year in Q1, owing to impressive results of PetroVietnam Gas (GAS) with a growth rate of 68.9%.

The power sector saw its profit after tax increase by 56.4%, after a fall of 35.8% in Q4/2021. The improvement was attributed to the recovery of post-Covid electricity consumption and additional earnings from wind power facilities operational in November 2021.

The construction and materials sector saw a 33.1% gain in net profit thanks to the higher price of construction glass, quartz, and plastic pipes.

In the opposite direction, steel enterprise profit growth slowed to only 12.4%, much lower than the 281.8% in Q1/2021, following soaring coking coal and transport expenses.

The paper and forestry sectors experienced a net profit decline of 11.7% year-on-year, given the rising prices of raw wood and freight.

Real estate businesses extended the downward trend with net profit decreasing by 5.7%. This followed a 36.9% dip in Q4/2021, due to the drop in apartment sales volume and rental segment.

Profit growth in small-cap firms reached 38.4% in Q1, mainly from significant stocks like BMS (+682%), IT (+276%), and BDG (+208%).

Twenty-five firms in the VN30 group, which comprises leading enterprises in terms of market cap and liquidity on the Ho Chi Minh Stock Exchange (HoSE), also recorded a positive profit after tax in Q1.

Of this, Masan Group (MSN), VPBank (VPB) and NovaLand (NVL) took the lead with growth rates of 752%, 171%, and 101% respectively. In contrast, Vietnam National Petroleum Group (PLX), Vincom Retail (VRE), and VietinBank (CTG) recorded the least positive results with growth rates of -63%, -52%, and -27.8%.

Data from VnDirect, Vietnam's top broker, shows that the entire market’s gross profit margin, excluding the banking sector, shrank mainly due to the decrease in gross profit margins of the real estate, mining, oil and gas, and automotive sectors. Due to a lack of data, the aviation industry was omitted from the results.

Notably, market-wide financial leverage grew for the first time in nine months. "The increase is in line with the banking system’s credit growth rate of 5%, which is higher than the Q1/2021 figure of 3%. This indicates that businesses are willing to use loans to expand operations post pandemic,” VnDirect reported.