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iShareInvest Research

UPCOM · Quý 4/2023

TTZ

Đầu tư Xây dựng và Công nghệ Tiến Trung

Analysis of business results & financial statements · Quý 4/2023

▲ Showing improvement

Trailing net profit reached 0.2bn, rose 2.3bn compared with the same period last year. Key positives came from better other profit and lower administrative expenses. Offsetting pressure came mainly from lower gross profit. Detailed impact is shown below:

See what is changing ↓
P/E
—
P/B
—
EPS
-27
BVPS
8,733
ROE
-0.3%
ROA
-0.3%
Market price
—

What Is Changing

On a TTM 2023Q4 basis, TTZ posted a sharp profit increase versus the same period, suggesting a clear improvement from a low base. However, most of the profit comes from non-core sources — this needs careful evaluation before concluding on growth quality.

Profit bridge

Vs last year · TTM

  1. Other profit
  2. Administrative expenses
  3. Gross profit
Unit: VND bn. Green bars support profit; red bars reduce profit.

A single data point, or a trajectory?

Latest eight quarters · Quý 4/2023

MetricQ4'23Q3'23Q2'23Q1'23Q4'22Q3'22Q2'22Q1'22
Revenue0.11.20.71.74.40.30.40.4
LNST0.2-0.4-0.20.22.6-0.3-4.5-0.2
Net margin150.99%-37.43%-33.07%14.54%59.24%-114.46%-1248.06%-45.71%

Revenue

0bn

Net income

0bn

Net margin

150.99%

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.

01

Is the profit sustainable?

Margins improved (+40.0pp), but earnings still rely significantly on non-core sources — warrants closer scrutiny.

Revenue Growth

▼▼

Is growth real and durable?

Trailing-12-month revenue declined 31.3% year on year — but the quarterly pace is slowing (+289% → −97%).

3 of the last 4 quarters grew year on year.

Revenue TTM
4bn
−31.3%
Latest quarter YoY
−97%
slowing

What is driving the margin?

▲▲

Net margin expanded to −5.54%, rising 40.0pp. Despite pressure from Gross margin fell 11.9pp and SG&A / Revenue rose 0.3pp, the offset came from Other profit / Revenue rose 46.2pp and Net financial result / Revenue rose 6.0pp.

Most of the margin increase comes from non-core items — core operations have not kept pace, this is a margin expansion to watch carefully.

Net Margin
−5.54%
+40.0pp
Gross Margin
16.98%
−11.9pp
SG&A / Revenue
34.16%
+0.3pp
Non-core / Revenue
11.64%
+52.2pp

TTM YoY · 2022Q4 -> 2023Q4

Non-core sources is supporting margin

Non-core sources accounts for 101.8% of PBT and lifted net margin by 52.2pp — separate the operating contribution from this source.

Cash Flow

▼▼

Is profit converting into cash?

Operating cash flow reached -2.0bn against investing cash flow of -0.5bn (annual cash-flow figures for 2023).

Post-investment cash flow was negative +2.5bn. Financing cash flow was positive +1.0bn.

CFO / net income was 9,89 lần.

After spending +0.5bn on fixed-asset investment, the business generated trailing free cash flow of −2.5bn.

Earnings Quality

▼

How much income is non-core?

Non-core income reaches 101.8% of pre-tax profit — core earnings are thinner than the headline.

Within that, net financial result at −108.4%, other profit at +101.8% of PBT.

Non-core / PBT
101.8%
high
Net financial / PBT
−108.4%
Other profit / PBT
101.8%
02

Is capital being used efficiently?

Evaluate capital, asset, and working-capital efficiency.

Is capital being deployed efficiently?

●

ROIC currently stands at −0.64%. Track NOPAT margin and capital turnover to assess capital efficiency.

None

ROIC remains low

ROIC is currently −0.64% — below the typical cost-of-capital threshold; worth tracking whether upcoming periods can rise above this level.

Working Capital Efficiency

●

Track receivable, inventory, and payable turns to judge working-capital efficiency.

Track DSO, DIO, DPO components to evaluate working capital turnover efficiency.

Cash conversion cycle remains stretched

CCC stands at 1017.7 days, suggesting that working capital remains tied up for a relatively long operating cycle.

DuPont

What drives ROE?

Net margin -5.5% +40.0pp
Asset turnover 0.05x -0.02x
Financial leverage 1.21x +0.04x
ROE -0.3% -3.4pp

ROE rose from −3.7% to −0.3% — supported by net margin and leverage.

03

Is financial risk significant?

Leverage is safe but FCF is negative at 2.5bn due to capex of 0.5bn — an investment choice, not an urgent risk.

Leverage & Liquidity

▼▼

Leverage warrants monitoring, with net debt / equity at 0.01x and interest coverage only at −1.86x.

At present, short-term debt accounts for 100.0% of total debt, cash equals 61.4% of debt, and total debt stands at 1.0bn.

Net Debt / Equity
0.01x
+0.04x
Interest Coverage
−1.86x
Cash / Debt
61.4%
−96.5pp
Short-term Debt / Total Debt
100.0%
0.0pp

TTM YoY · 2022Q4 -> 2023Q4

Interest coverage is thin

Interest coverage is −1.86x, leaving limited room to absorb financing costs.

Short-term refinancing pressure is meaningful

Short-term debt accounts for 100.0% of total debt, raising near-term refinancing needs.

Balance Sheet

▼

Capital structure is conservative with low leverage — liabilities at 0.15x equity, net debt at 0.01x equity.

Construction materials are input-cost-cycle businesses — gross margin is the thermometer. Input costs are eating the margin: gross margin narrowed 11.9pp YoY to 16.98% (TTM). Margin flexing with the raw-material cycle is a group property — the next question is how much high-cost inventory remains.

Gross margin (TTM): 16.98% · YoY -11.9pp

Inventory 11.8bn — 14.55% of total assets, above the materials-group median (13.00%); ≈ 1,384 days of sales. Inventory is growing faster than revenue (16.20% vs −31.31% YoY) — stockpiling ahead of prices, or slow-moving goods; read with next period's gross margin.

Inventory / assets: 14.55% (group median 13.00%)

Days inventory outstanding: 1,384

Inventory ended the period at 11.8bn, roughly 15.5% of total assets.

Over the last 12 months, working capital absorbed 3.4bn of cash, mainly because of higher receivables and higher inventories.

Research synthesis

What this reporting period is showing

The business is heading the right way, but the current picture is still at partial confirmation — not yet a fully clean case. The positive points have clearly improved, showing the operating base is better than before. The brighter spot is operating efficiency, with net margin improving 40.0 pp. The next item to monitor is the earnings mix, when non-core contribution is −108.4%. The main risk still sits in capital efficiency remains weak, with ROIC at −0.6%.

  • Improvement: operating efficiency is getting better, with trailing-12M net margin at -5.54% after expanding 40.0pp versus the same period last year.
  • Watchpoint: cash flow is currently keeping pace with accounting earnings, with CFO / net income at 9.89x. Even so, net financial result still accounts for −108.4% of PBT, so the earnings mix still needs monitoring.
  • Key risk: Capital efficiency remains weak.

Questions for the next period

  1. Whether revenue stabilizes after a −31,3% YoY decline or keeps falling.

  2. Whether margins hold around the current -5.54% level or narrow again.

  3. Whether operating cash flow holds its -2.0bn (cumulative for 2023) level in upcoming periods or weakens.

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