Earnings Report /
Thailand

Thai Vegetable Oil PCL: Core profit slightly below model; QoQ lower 4Q22 earnings trend

  • Missed our forecasts slightly

  • TVO posted a 3Q22 net profit of Bt593m

  • We model a Bt530m 4Q22 core profit

Bualuang Securities
14 November 2022

Our HOLD rating stands on a 5-6% dividend yield in 2023. We expect GM for both SBM and SBO to normalize in 2023, given the lower sales prices for SBM and SBO in 2023.

Missed our forecasts slightly  

TVO posted a 3Q22 net profit of Bt593m, up 65% YoY but down 38% QoQ. Excluding extra items in 3Q22—Bt11m FX loss, Bt62m gain from derivatives, Bt34m in inventory impairment, Bt4m in reversal of financial asset impairment and Bt2m in PP&E impairment—core profit was Bt573m, up 229% YoY but down 25% QoQ. Net and core profits were 6% and 4% below our model, respectively, primarily thanks to lower GM than modeled. Sales beat our model by 7% while GM of 9.1% in 3Q22 was lower than our 10.7% estimate (against 5.5% in 3Q21 and 12.4% in 2Q22).