Dabaco Q2/2026 Net Profit Falls 43% on Lower Hog Prices

Overview

Dabaco Vietnam Group (DBC) reported a 43% year-on-year decline in Q2/2026 net profit to VND 289.1 billion, despite revenue growing 11.3% to VND 4,252.8 billion. The drop was driven by lower hog prices, which offset gains in feed, poultry, and vegetable oil segments. The results highlight the ongoing volatility in Vietnam’s livestock cycle and its impact on integrated agribusiness margins.

Key Facts

• Q2/2026 net profit: VND 289.1 billion, down 43% from Q2/2025.
• Q2/2026 revenue: VND 4,252.8 billion, up 11.3% year-on-year.
• Gross profit fell 20.8% to VND 653.4 billion from VND 825 billion.
• H1/2026 net profit: VND 663.2 billion, down 34.7% year-on-year.
• H1/2026 revenue: VND 8,377 billion, up 12.8%.
• Full-year 2026 profit target: VND 1,117 billion; 59.4% achieved after two quarters.
• H1/2026 operating cash flow was negative VND 97.4 billion, versus positive VND 1,184.3 billion a year earlier.
• Total assets at June 30, 2026: VND 17,734.3 billion, up 11% from year-start.

What Happened

Dabaco Vietnam Group (DBC), listed on HOSE, released its consolidated financial statements for Q2/2026, showing net profit of VND 289.1 billion, a 43% decline from the same period last year. The company attributed the drop primarily to lower hog prices during the quarter, which reduced profitability in its pig farming operations. Although feed production, chicken farming, and vegetable oil businesses performed better than a year earlier, the pig segment dragged overall results.

Revenue rose 11.3% to VND 4,252.8 billion, but cost of goods sold remained high, causing gross profit to fall 20.8% to VND 653.4 billion. Financial costs increased to VND 85.4 billion from VND 65.8 billion, while selling and administrative expenses also rose. For the first half of 2026, net profit reached VND 663.2 billion, down 34.7% year-on-year, despite revenue growth of 12.8%. The company completed 59.4% of its full-year profit plan of VND 1,117 billion.

Market Context

DBC shares closed at VND 16,450 on July 30, 2026. The stock has been under pressure amid weak hog prices and broader concerns about the agricultural cycle. The company’s H1 operating cash flow turned negative, a notable deterioration from the positive VND 1,184.3 billion in the prior-year period, reflecting higher working capital needs and margin compression. As a major integrated livestock and feed producer on HOSE, DBC’s earnings are highly sensitive to hog price movements, which have been declining in 2026.

Strategic Significance

Dabaco’s integrated model—spanning feed, breeding, and processing—provides some cushion against cyclical downturns, as evidenced by revenue growth in non-pig segments. However, the sharp profit decline underscores the company’s exposure to hog price volatility. The completion of the second-phase oil extraction plant, which reduced construction-in-progress costs by 46.6%, could support future earnings diversification. Long-term investors should assess whether Dabaco can manage its debt levels (total liabilities up 16.5% to VND 9,213.1 billion) while navigating the current downcycle.

What to Watch

• Quarterly hog price trends in Vietnam and their impact on DBC’s pig farming margins.
• Q3/2026 earnings release, expected in October 2026, to see if profit decline stabilizes.
• Progress on the new oil extraction plant’s contribution to revenue and profit.
• Changes in operating cash flow, as negative H1 cash flow may signal working capital strain.
• Any updates on the company’s full-year profit target achievement and potential revisions.