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Quang Ngai Sugar (QNS VN) – FY 2025 – Beverage Growth Supports Earnings Amid Sugar Pressure
Summary of FY 2025 results and outlook of Quang Ngai Sugar JSC (QNS VN)
- 2025 revenue rose 3.2%, as strong growth in plant-based beverages (in which 93% is soya milk), offset weaker sugar performance. Revenue from plant-based beverages increased 15.1% y/y, driven by a 3.5% rise in sales volume, a 4.0% increase in average selling prices while the remaining was due to new accounting treatment. In contrast, revenue from the sugar segment declined 7.9% y/y, despite a modest increase in sales volume, as average selling prices fell 10.8%. Stricter regulatory requirements disrupted small grocers and household F&B customers, leading to higher inventory for QNS, while softer global sugar prices added more pressure on the sugar business.
- Net profit declined by 19.2% y/y. The sugar segment’s gross margin narrowed due to lower average selling price, but gains in plant-based beverages limited the overall margin to decline to 33.4%. Additionally, QNS stepped up marketing and promotional spending in the plant-based beverage segment amid intensified competition from both domestic and international players. As a result, SG&A expenses increased 45.6% y/y, leading to a 19.0% decline in operating profit. Despite the near-term earnings impact, the company improved its competitive position, with market share in plant-based beverages rising to over 60%.
- Sugar outlook: Consumption may moderate amid rising health awareness and the planned Special Consumption Tax from 2026, though overall demand is still projected to grow 5.6%, supported by food processing, confectionery, and household usage. The anti-dumping duty on Thai sugar, likely to be extended beyond June 2026, would continue to support domestic sugarcane production and improve self-sufficiency, while stricter invoicing rules may shift household businesses toward formal suppliers. However, sugar prices are expected to decline by 3% due to global oversupply.
- Plant-based beverage outlook: Consumption is expected to grow by 7% driven by rising health awareness, continued product innovation and the conversion from unbranded to branded products. Competitive intensity is high, but scale, brand strength, and broad distribution continue to favor market leaders.
- For 2026, sugar sales volume is set to increase year-on-year, while selling prices move broadly in line with global trends. The plant-based beverage segment continues its growth trajectory, driven by volume expansion and increase in selling prices. A stable SG&A-to-sales ratio, alongside stronger financial income from a larger cash balance, provides further support for net profit.
Interested in QNS? Click here to read more of our previous analysis on QNS’s quarterly earnings.
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