Earnings Report /

True Corp PCL: Below estimates; QoQ shallower core loss expected in 3Q22

  • Deeper core loss than estimated

  • TRUE posted a 2Q22 net loss of Bt761m

  • We model a Bt1.5bn core loss for 3Q22

Bualuang Securities
16 August 2022

Our TRADING BUY stands in anticipation of shallower core loss and the service revenue recovery in 2H22. We believe that investors will pay attention to the NBTC’s decision on the Amalgamation deal expected in early-Sep 2022, which will be the catalyst for its share price.

Deeper core loss than estimated  

TRUE posted a 2Q22 net loss of Bt761m, deeper in the red by 155% YoY but shallower by 53% QoQ. Excluding extra items in 2Q22—Bt1.19bn gain from the 2.82% sale of its stake in DIF (from 23.38% to 20.56%), Bt75m in FX gain and Bt222m in other extra gains—it posted a massive Bt2.25bn core loss, deeper in the red by 678% YoY and 4% QoQ. Net loss missed our Bt95m net profit estimate while core loss was 61% deeper than our model due to higher service costs and SG&A than modeled. Group’s service revenue was in line with our estimate. Gross profit, operating profit, EBITDA and after-tax loss missed our estimates by 7%, 45%, 6% and 49%, respectively. Service costs and SG&A expenses exceeded our model by 2% and 10%, respectively.