Earnings Report /
Thailand

Khon Kaen Sugar Industry PCL: Core numbers notch up huge miss; a strong bounce anticipated in 2022

  • Beat bottom-line but core numbers missed our model by a mile

  • KSL posted a net profit for 4Q21 (Aug 1-Oct 31, 2021) of Bt149m

  • Net profit beat our model by 152%

Bualuang Securities
24 December 2021

Our TRADING BUY stands, led by the sugar price up-cycle through 2022 (ongoing drought in south-central Brazil) and its strong 2022 core earnings bounce driven by both sugar sales volume and selling price.

Beat bottom-line but core numbers missed our model by a mile

KSL posted a net profit for 4Q21 (Aug 1-Oct 31, 2021) of Bt149m, up 55% YoY and 166% QoQ. Stripping out seven extra items in 4Q21—1) Bt19m FX gain, 2) Bt80m gain from derivative hedging, 3) Bt5m loss from change in fair value of biological assets, 4) Bt209m gain from change in fair value of property for investment, 5) Bt17m loss on fixed asset impairment, 6) Bt14m loss from asset sale and write-off and 7) Bt244m gain from BBGI’s 8.89%-stake sale of UBE (from 21.28% to 12.39%)—it posted a core loss of Bt365m in 4Q21, a reversal from core profits of Bt93m in 4Q20 and Bt133m in 3Q21.