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- Q1 2025: Net sales declined by 8% YoY and NPAT-MI dropped 29% YoY to VND1.6tn (USD60mn). NPAT-MI completes 17% of our 2025 forecast and is behind our expectations. We see downside risk to our forecast, pending a fuller review.
- Domestic sales: In Q1 2025, VNM’s parent domestic sales dropped 14% YoY, which management attributes to short-term disruption caused by VNM’s distribution and sales restructuring following the full packaging revamp completed in 2024. From early April, VNM expects domestic revenue to grow by double-digits YoY. We are awaiting further management comments on this matter. Additionally, MCM’s sales declined 5% YoY. We believe this data suggests weaker-than-expected underlying demand for milk-based products in Q1 2025.
- Overseas market: Combined sales from overseas subsidiaries — including Driftwood (US) and Angkor Milk (Cambodia) — slid 1% YoY in Q1. In contrast, export revenue surged 25% YoY, mainly driven by increased demand in the Middle East market. In Q1, total sales from the overseas market increased 12% YoY.
- Profitability: In Q1, total GPM declined by 160 bps YoY to 40%, which we mainly attribute to VNM’s domestic sales decline. The overseas market saw strong GPM expansion of 2.3 ppts YoY, while GPM of domestic businesses dropped 2.7 ppts YoY, which trailed our forecast. SG&A expenses increased 3% YoY, driven by VNM’s continued marketing efforts to support brand awareness for its new product and packaging launches.
VNM’s Q1 2025 results
VND bn | Q1 2024 | Q1 2025 | YoY | 2025F | Q1 2025 as % of 2025F |
Net revenue | 14,112 | 12,935 | -8% | 63,823 | 20% |
| 11,497 | 10,011 | -13% | 52,414 | 19% |
| 2,616 | 2,924 | 12% | 11,409 | 26% |
Exports | 1,297 | 1,620 | 25% | 5,664 | 29% |
Driftwood & Angkor Milk | 1,319 | 1,303 | -1% | 5,745 | 23% |
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Gross profit | 5,912 | 5,210 | -12% | 26,308 | 20% |
| 4,848 | 3,954 | -18% | 21,745 | 18% |
| 1,063 | 1,256 | 18% | 4,563 | 28% |
Exports | 764 | 958 | 25% | 3,268 | 29% |
Driftwood & Angkor Milk | 299 | 298 | 0% | 1,295 | 23% |
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SG&A expenses | -3,491 | -3,601 | 3% | -15,852 | 23% |
EBIT | 2,420 | 1,610 | -33% | 10,457 | 15% |
Net financial income | 285 | 325 | 14% | 1,203 | 27% |
NPAT-MI | 2,195 | 1,568 | -29% | 9,347 | 17% |
Gross margin | 41.9% | 40.3% |
| 41.2% |
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| 42.2% | 39.5% |
| 41.5% |
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| 40.6% | 43.0% |
| 40.0% |
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Exports | 58.9% | 59.1% |
| 57.7% |
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Driftwood & Angkor Milk | 22.7% | 22.9% |
| 22.5% |
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SG&A/net sales | 24.7% | 27.8% |
| 24.8% |
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EBIT margin | 17.2% | 12.4% |
| 16.4% |
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NPAT-MI margin | 15.6% | 12.1% |
| 14.6% |
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Source: VNM, Vietcap
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