Earnings Report /
Thailand

Netbay PCL: Earnings beat the street by 31%

  • Net profit was 31% above the consensus estimate

  • NETBAY reported net earnings of Bt34m for 2Q20

  • Cost-of-sales & services was flattish YoY but up 3% QoQ

Napon Jaisan
Napon Jaisan

Equity Research Analyst

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Bualuang Securities
11 August 2020

Fallout from COVID-19 has squeezed NETBAY’s short-term outlook, but it should prove to be a long-term booster. During the coronavirus panic, many firms started to understand why they should shift to digital documentation processes, due to problems tied to using traditional paper documents. And many companies laid off staff. In contrast, NETBAY is now recruiting new employees—human resources are its most important asset. We expect the COVID-19 slump to prompt many firms to modernize their documentation processes and upgrade their IT systems, opening new opportunities for software vendors and online B2B and G2B service providers. BUY!

Net profit was 31%  above the consensus estimate

NETBAY reported net earnings of Bt34m for 2Q20, down by 25% YoY and 17% QoQ. Excluding extra items—a Bt5m allowance for doubtful debts (required under the new TFRS9 accounting standard) and Bt1.6m in expenses tied to a CSR project (the donation of medical robots to hospitals)—core profit would be Bt41m, down 19% YoY but up 1% QoQ. The result was 31% above the street estimate (but was in line with our model).