Duc Giang Chemicals (DGC) Q1 2026 Profit Plunges 49% on Input Costs, Mine Shutdown
This Aveluro analysis covers DGC (Tập đoàn Hóa chất Đức Giang) in the Chemicals sector. The classified event type is earnings miss, with negative sentiment and a deterministic market-impact score of 8.4/10. Source coverage came from CafeF - Thị trường chứng khoán, classified as a primary/top-tier source.
Overview
Duc Giang Chemicals Group (DGC) reported a 49% year-on-year decline in Q1 2026 net profit to 430 billion VND, with revenue falling 24% to 2.1 trillion VND. The sharp drop is attributed to soaring input costs—especially sulfur prices tripling—and the suspension of operations at mine 25, forcing the company to use imported ore. The results underscore ongoing operational and regulatory challenges for the HoSE-listed chemical producer.
Key Facts
- Q1 2026 net profit: 430 billion VND, down 49% YoY.
- Q1 2026 revenue: 2.1 trillion VND, down 24% YoY.
- Gross profit fell 50% to 489 billion VND.
- Sulfur input costs tripled versus the same period last year.
- Mine 25 temporarily halted for investigation; DGC now uses 100% imported ore.
- Cash and bank deposits: 11.2 trillion VND (62% of total assets).
- Construction in progress rose 28% to over 1 trillion VND, mainly for the Nghi Son chemical plant project.
What Happened
Duc Giang Chemicals Group (DGC) released its Q1 2026 financial statements on April 15, 2026, revealing a steep profit decline. The company attributed the drop to a sharp increase in raw material costs, particularly sulfur, which was three times higher than in Q1 2025, along with rising electricity, coke, and ammonia prices. Additionally, the temporary shutdown of mine 25 for investigation forced DGC to rely entirely on imported ore and external purchases, significantly raising the cost of yellow phosphorus production.
Despite the earnings miss, DGC maintained a strong balance sheet. Cash and bank deposits totaled over 11.2 trillion VND, generating 148 billion VND in interest income during the quarter. Total liabilities fell 46% to 2.3 trillion VND. Separately, DGC is addressing a stock warning from HoSE due to a delayed 2025 audited financial report; the company plans to select a new auditor at an extraordinary shareholder meeting on May 8, 2026, and expects to complete the audit in Q2 2026.
Market Context
DGC shares closed at 56,000 VND on April 15, 2026, down 1.07% on light volume of 332,600 shares. The stock has been under pressure from both the earnings miss and ongoing legal issues, including the indictment of Chairman Dao Huu Huyen and Vice Chairman Dao Huu Duy Anh on charges related to environmental violations and resource exploitation. The chemicals sector on HoSE has faced headwinds from rising global input costs and regulatory scrutiny.
Strategic Significance
The Q1 results highlight DGC’s vulnerability to input cost volatility and operational disruptions at its mines. The reliance on imported ore erodes the cost advantage that DGC historically enjoyed from its captive mines. However, the company’s massive cash pile provides a cushion and could fund strategic investments, such as the Nghi Son chemical plant, which may diversify revenue streams. The resolution of the audit delay and legal cases will be critical for restoring investor confidence and lifting the stock warning.
What to Watch
- Outcome of the extraordinary shareholder meeting on May 8, 2026, regarding auditor selection.
- Completion of the 2025 audited financial report and lifting of the stock warning.
- Progress on the Nghi Son chemical plant project and its impact on future earnings.
- Developments in the legal cases involving senior management and mine 25 operations.
- Trends in global sulfur and phosphorus prices in Q2 2026.
Trade DGC on Vietnam's top brokers
Open an account with a licensed Vietnamese broker to access HOSE, HNX, and UPCOM markets.
Affiliate links — Aveluro may earn a commission at no extra cost to you.