NT2 Flash News – N/A

Nhon Trach 2 Thermal Power JSC (HoSE: NT2)

NT2 announced Q4/2024 results with VND1,792 bn in revenue, +48.8% YoY. However, NPAT was only VND64 bn, -70.5% YoY. For 2024, NPAT reached VND72 bn, -84.7% YoY, fulfilling 106% of the company’s 2024 plan and 39% of ACBS’s forecast. The primary reasons for these unfavorable results were a decrease in output (2024: 2.7 bn kWh, -5.1% YoY) and an increase in gas prices. 

Q4/2024’s output increased by 107.9% YoY to 821 mil kWh. This surge was due to NT2’s major 100,000-hour operational overhaul in Q3 and Q4/2023, which had significantly reduced output during that period. Despite the increased output, the selling price decreased by 1.8% to VND2,170/kWh, resulting in only a +48.8% YoY in Q4 2024 revenue. Additionally, production costs surged due to a 2.6% YoY increase in gas prices, averaging $9.45/MMBtu. Consequently, gross profit reached VND73 bn, -68.1% YoY, with the gross margin falling to 4.1% (compared to 19.0% YoY). NPAT reached VND64 bn, -70.5% YoY.

In 2024, output reached 2.7 bn kWh, -5.1% YoY, and revenue was VND5,952 bn, -6.8% YoY. Gross profit reached VND37 bn, -92.9% YoY, with the gross margin falling to a mere 0.6% (compared to 8.0% YoY). This decline was attributed to +4.4% YoY in gas prices, averaging $9.46/MMBtu, despite a slight decrease in oil prices, which due to the depletion of gas fields and rising extraction costs. The NPAT’s margin fell to 1.2%, from 7.4% YoY, and NPAT reached VND72 bn, -84.7% YoY.

Quick conclusion: NT2 achieved 106% of its 2024’s target. However, this result only reached 39% of ACBS’s expectations. This figure does not include the exchange rate difference of VND177 bn that we anticipate NT2 may receive in 2024. Recently, several negative factors are impacting NT2’s performance in the near future, such as the return of the La Nina cycle, high gas prices making it difficult for NT2 to compete in the free market, and the risk of direct competition from NT3 & 4 in the same region. Therefore, we will update the forecast and valuation for NT2 in the next report.

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