Analysis of business results & financial statements · Quý 2/2024
▼▼ Declining sharply
Trailing net profit reached 4.7bn, fell 5.3bn compared with the same period last year. Key positives came from lower selling expenses, lower finance costs, and lower administrative expenses. Offsetting pressure came mainly from lower gross profit and lower financial income. Detailed impact is shown below:
See what is changing ↓- P/E
- —
- P/B
- —
- EPS
- -878
- BVPS
- 1,493
- ROE
- -16.3%
- ROA
- -2.6%
- Market price
- —
The current picture
What Is Changing
On a TTM 2024Q2 basis, MHL posted a very sharp profit drop versus the same period, showing that pressure has clearly fed through to the bottom line — margins have been compressing consistently over multiple periods. More notably, operating cash flow is significantly negative relative to profit — this is pressure that needs close monitoring.
Profit bridge
Vs last year · TTM
- Selling expenses
- Finance costs
- Administrative expenses
- Gross profit
- Financial income
Across periods
A single data point, or a trajectory?
Latest eight quarters · Quý 2/2024
| Metric | Q2'24 | Q1'24 | Q4'23 | Q3'23 | Q2'23 | Q1'23 | Q4'22 | Q3'22 |
|---|---|---|---|---|---|---|---|---|
| Revenue | 0.0 | 0.0 | 0.0 | 31.7 | 0.0 | 0.0 | 21.6 | 73.1 |
| LNST | -3.5 | -1.8 | -0.1 | 0.7 | -0.2 | -1.2 | 1.3 | 0.8 |
| Net margin | — | — | — | 2.17% | — | — | 6.01% | 1.04% |
Revenue
0bnNet income
-4bnNet margin
2.17%Inside the statements
A closer look at what is happening inside the business
A company's statements are read with the questions that fit its type of business.
Is the profit sustainable?
Margins narrowed but earnings quality remains clean — pressure is mainly operational.
Revenue Growth
▼▼Is growth real and durable?
Trailing-12-month revenue declined 66.5% year on year — but the quarterly pace is slowing (−57% → −100%).
0 of the last 2 quarters grew year on year.
- Revenue TTM
- 32bn −66.5%
- Latest quarter YoY
- −100% slowing
What is driving the margin?
▼▼Net margin fell to −14.80%, losing 15.5pp. The main pressure is Gross margin fell 25.4pp, outweighing the improvement in SG&A / Revenue fell 6.3pp (in addition, Net financial result / Revenue rose 3.8pp added support while Other profit / Revenue fell 0.2pp remained a drag).
The pressure comes from core operations — this is a concerning type of decline, not a one-off movement.
- Net Margin
- −14.80% −15.5pp
- Gross Margin
- −11.05% −25.4pp
- SG&A / Revenue
- 3.75% −6.3pp
TTM YoY · 2023Q2 -> 2024Q2
Cash Flow
▼Is profit converting into cash?
High leverage combined with negative cash flow reveals the actual liquidity pressure. Operating cash flow reached -0.9bn against investing cash flow of 0.0bn (annual cash-flow figures for 2023).
Post-investment cash flow was negative +0.9bn. Financing cash flow was negative +1.2bn.
CFO / net income was −14,23 lần.
After spending +66.7bn on fixed-asset investment, the business generated trailing free cash flow of +0.0bn.
Earnings Quality
▲How much income is non-core?
About 100% of pre-tax profit comes from core operations.
Within that, net financial result at −0.0%, other profit at 0.0% of PBT.
- Non-core / PBT
- 0.0% low
- Net financial / PBT
- −0.0%
- Other profit / PBT
- 0.0%
Is capital being used efficiently?
Capital efficiency is declining — check whether the drag is from margins or turnover.
Is capital being deployed efficiently?
▼▼ROIC fell to −3.91%, losing 4.2pp. That translates to −3.91 in after-tax operating profit for every 100 units of operating capital. Both NOPAT margin narrowed 15.3pp and capital turnover fell 0.35x, with invested capital holding roughly steady — pressure came from both operational efficiency and asset efficiency.
Pressure came from the margin side — core operations are weakening, not just a temporary asset-management issue.
ROIC is currently −3.91% — below the typical cost-of-capital threshold; worth tracking whether upcoming periods can rise above this level.
Working Capital Efficiency
▼▼Cash conversion cycle lengthened by 40.3 days versus the same period last year. The main moves came from DIO rose 37.1 days, DSO fell 33.0 days, and DPO fell 36.3 days.
Working capital cycle lengthened mainly due to slower inventory turnover — more capital is being tied up in inventory.
CCC stands at 293.7 days, suggesting that working capital remains tied up for a relatively long operating cycle.
DIO increased by +37.1 days, suggesting more capital is being tied up in inventories.
DuPont
What drives ROE?
ROE fell from 1.2% to −16.3% — dragged by net margin and asset turnover.
Is financial risk significant?
High leverage combined with negative operating cash flow — this area needs close monitoring.
Leverage & Liquidity
▼▼Track net leverage, interest coverage, and the liquidity buffer on the balance sheet.
At present, short-term debt accounts for 68.6% of total debt, cash equals 0.1% of debt, and total debt stands at 82.4bn.
- Net Debt / Equity
- 10.16x +8.14x
- Interest Coverage
- None
- Cash / Debt
- 0.1% +0.1pp
- Short-term Debt / Total Debt
- 68.6% −23.0pp
TTM YoY · 2023Q2 -> 2024Q2
Net debt / equity stands at 10.16x, increasing balance-sheet pressure.
Short-term debt accounts for 68.6% of total debt, raising near-term refinancing needs.
Balance Sheet
▼▼The balance sheet shows capital-allocation efficiency slipping. Leverage is very high, with clear pressure on the capital structure — liabilities at 8.26x equity, net debt at 10.16x equity.
None
Over the last 12 months, working capital released 66.6bn of cash, mainly thanks to lower receivables and higher payables.
In summary
Research synthesis
What this reporting period is showing
The business is showing a few weaker signals, but the current magnitude is not yet clear enough to conclude that this is a broader weakening phase. The next item to monitor is effective tax rate looks unusual, with effective tax rate at 0.0%. The main risk still sits in core profitability, with net margin down 15.5 pp.
- Watchpoint: the effective tax rate looks unusual, so current net profit may not fully reflect underlying earnings quality.
- Key risk: profitability remains under pressure, with trailing-12M net margin at -14.80% after a 15.5pp decline versus the same period last year.
What to verify next
Questions for the next period
Whether revenue stabilizes after a −66,5% YoY decline or keeps falling.
Whether margins hold around the current -14.80% level or narrow again.
Whether operating cash flow holds its -0.9bn (cumulative for 2023) level in upcoming periods or weakens.
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