NT2 – Strong Q1/2023 earnings because of increased output and lower gas price
- NT2 reported its Q1/2023 business results with total electricity output of 1,075 mn kWh (+9% QoQ, +8% YoY), while input prices decreased slightly, averaging 8.9 USD/mn BTU (-5% YoY). Revenue and NPAT were recorded at VND 2,183 bn (+9% YoY) and VND 234 bn (+47% YoY), respectively.
- NT2’s Q1/2023 performance is in line with our expectations. However, we reduce our estimates of electricity output for FY2023 to 4.1 bn kWh (+0.7% YoY) as (1) major maintenance in Q3 (from September 17th to the end of October), and (2) Qc mobilized in August is expected to be 86% lower YoY.
- For FY2023, due to a major maintenance plan, we lower our NT2’s net revenue forecasts to VND 8,417 bn (-4% YoY), assuming (1) output of 4.1 bn kWh (+0.7% YoY), (2) average gas price of USD 8.9/ mm BTU (-6% YoY), (3) A reimbursement for realized FX loss of VND 155bn expected to receive in Q4. NT2’s maintenance budget of VND 407 bn is scheduled to be amortized over three years. As a result, we forecast NT2’s NPAT to be VND 712 bn (-19.4% YoY), corresponding to an EPS of VND 2,436/share.
- We have a NEUTRAL rating with a one-year target price of VND 29,700/share. With an expected cash dividend of VND 2,500/share in the next 12 months, total return is determined at 3% based on the closing price on May 10th, 2023.
PetroVietnam Power NhonTrach 2 JSC. PetroVietnam Power Nhon Trach 2 Joint Stock Company (PV POWER NT2) is a Vietnam-based company operating in the energy industry, which operates and manages the 750-megawatt (MW) Nhon Trach 2 combined-cycle power plant located in Phuoc Khanh commune, Nhon Trach district, Dong Nai province. The electricity output of the power plant is purchased by Vietnam Electricity, and it is directly transmitted into the national grid system.
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