Our TRADING BUY stands, in anticipation of the NBTC’s satellite orbital slot license auctions in 2H22 and a reversal into core profit for 2022.
Net profit beat but core profit missed our model
THCOM posted a Bt51m net profit for 1Q22, down 55% YoY but against a Bt72m 4Q21 net loss. Excluding extra items in 1Q22—1) Bt23m FX loss and 2) Bt63m in reversal of impairment loss arising from debt collection of long-overdue account receivable—it posted a Bt11m core profit for 1Q22, against core losses of Bt41m in 1Q21 and Bt55m in 4Q21. Net profit beat our model by 26% thanks to the recognition of the above extra item of reversal of impairment loss but core profit was 47% short of our estimate (Bt11m versus our Bt20m estimate) due to lower sales and higher tax expenses than modeled. Sales were 8% short of our model. GM of 49.4% was slightly higher than our 48% estimate. Equity loss from Laos Telecom (LTC) was 35% shallower than our model thanks to the improvement of Lao Kip depreciation against USD.