The PAN Group Q2/2024: Continuing Strong Growth

On July 25, PAN Group JSC (HSX: PAN) announced its consolidated financial report for Q2 and the cumulative first six months of 2024. Following the growth momentum from Q1, the Group achieved impressive revenue and profit results amidst a volatile market environment.

PAN's business results Quarter II/2024 and 6M/2024
Indicator	QII/2024	QII/2023	%yoy	6M/2024	6M/2023	%yoy
Net revenue	3,378	2,778	22%	6,839	5,309	29%
Profit before tax	256	187	37%	456	315	43%
Profit after tax	201	160	26%	370	263	39%
Net profit to parent company's shareholders	85	65	31%	169	102	61%

Continued Strong Growth Compared to the Same Period

In Q2/2024, the Group recorded consolidated net revenue of VND 3,378 billion, a nearly 22% increase from the same period last year. For the first six months of 2024, PAN achieved consolidated net revenue of VND 6,839 billion, a 29% increase compared to the first six months of 2023.

The agriculture sector had the highest growth rate in Q2, increasing by 26% compared to the same period last year, while the seafood and packaged food sectors grew by 20% and 14%, respectively. The revenue from these core business sectors all achieved double-digit growth over the first six months of the year, ranging from 28% to 30%.

Net revenue by business sector (unit: VND billion)
Net revenue	QII/2024	QII/2023	%yoy	6M/2024	6M/2023	%yoy
Agriculture	1,508	1,196	26%	2,835	2,215	28%
Aquaculture	1,401	1,167	20%	2,984	2,300	30%
Packaged foods	469	414	14%	1,020	794	29%
Consolidated net revenue	3,378	2,777	22%	6,839	5,309	29%

The growth in the aquaculture sector was driven by the recovery of export orders, along with improved inflation conditions and purchasing power in the U.S. and European markets.

Meanwhile, revenue growth in agriculture continued to be driven by the Vietnam Fumigation Joint Stock Company (HSX: VFG), which has been steadily gaining market share in plant protection products from its competitors. In the first six months of 2023, partner Syngenta continued to collaborate with VFG on new products, allowing the company to further expand its product portfolio and competitive capabilities in the market.

VFC has increased its market share in the fumigation and agrochemical sectors, helping farmers access many new and effective solutions.

In the packaged food sector, Bibica (HSX: BBC) intensified its export channels, which positively contributed to its business results, with export sales in the first six months increasing by over 50% compared to the same period last year.

Revenue growth has contributed to the Group's improved profitability. Specifically, consolidated pre-tax profit in Q2 this year reached VND 256 billion, up 37% year-over-year. For the first six months, consolidated pre-tax profit reached VND 456 billion, a 43% increase compared to the first half of 2023.

Consolidated post-tax profit in Q2 was VND 201 billion, an increase of 26% year-over-year. For the first six months, consolidated post-tax profit reached VND 370 billion, up 39% compared to the first half of 2023.

Net profit attributable to parent company shareholders in Q2 and the first half of the year was VND 85 billion and VND 169 billion, respectively, reflecting growth rates of 31% and 61% compared to the same periods in 2023.

Profit by business sector (Unit: VND billion)
Profit	QII/2024	QII/2023	%yoy	6T/2024	6T/2023	%yoy
Agriculture	223	189	18%	377	316	19%
Aquaculture	121	107	13%	191	168	14%
Packaged foods	31	16	94%	65	28	132%
Consolidated profit before tax	256	187	37%	456	318	43%
Consolidated profit after tax	201	160	26%	370	267	39%
Net profit to parent company's shareholders	85	65	31%	169	105	61%

Profit indicators in Q2 and the first half of the year showed strong growth compared to the same period last year, with the main contributions coming from the agriculture and packaged food sectors. The aquaculture sector, meanwhile, continued to grow positively, albeit less quickly than anticipated because of a slower rebound in selling prices and purchasing power.

In the agriculture sector, VFC had pre-tax profit growth of 40% in Q1 and 60% in Q2. VFC's pre-tax profit increased by more than 50% over the first half of the year, surpassing revenue growth as the business realized cost savings in both sales and management.

The seed segment faced negative impacts from drought conditions that reduced planting areas, but it still managed to maintain a profit growth rate of 8%.

Bibica has successfully exported various confectionery products to South Korea.

In the packaged food sector, Bibica had rapid growth in the first half of 2023, with a pre-tax profit of VND 24 billion, up from over VND 4 billion in the same period the previous year. This was made possible by the company's expansion of its export channels. In addition, the company has been introducing new products (bread, jellies, and gummy candy) to expand its product line and better cater to consumer tastes. Because of this, the business has been able to lower prices, increase gross profit margins, optimize manufacturing costs, and make use of its production capacity.

In aquaculture sector, Sao Ta Foods (HSX: FMC) reported a 32% increase in shrimp income in the seafood industry; however, profit growth was only 10% as a result of insufficient improvement in selling prices. In the meantime, despite a 9% rise in sales, the Pangasius division achieved an excellent pre-tax profit growth of over 54% by concentrating on extensively processed and high-value products.

Business Outlook for the Second Half of 2024

With consolidated net revenue of VND 3,378 billion for the first six months, PAN Group has achieved 46% of its annual revenue target. Profitability indicators, including pre-tax profit, net profit, and net profit attributable to the parent company, reached 43%, 42%, and 39% of the 2024 targets, respectively.

The completion rate of revenue and profit targets for the first half of the year is seen as optimistic, considering the peak business periods for key sectors typically focus on the last two quarters of the year.

For the latter half of 2024, PAN Group anticipates several positive factors aiding in achieving its annual business plan:

The export market is expected to continue recovering, with improvements in both order volumes and prices. The harvest of self-cultivated shrimp in Q3 is anticipated to benefit the aquaculture sector significantly in Q3 and particularly Q4.

In packaged foods sector, the confectionery business will continue to boost exports following initial contracts with customers in South Korea, Japan, and China. New products launched in the market are expected to positively impact business results, potentially exceeding the 2024 business plan.

In agriculture sector, both the plant protection and seed segments will leverage their market position and large harvest seasons in Q3 and Q4 to maintain high growth results similar to the first half of the year.

Public link

Please use the above public link if you want to share this noodl on another website.