DHG Q3/2026 Profit Falls 53% to VND 98.5B, Lowest Since 2011

Overview

Dược Hậu Giang (HOSE: DHG) reported Q3/2026 after-tax profit of VND 98.5 billion, down 53% year-on-year and the lowest quarterly result since Q1/2011, according to the company’s Q3/2026 financial statements. Net revenue fell 11% to VND 1,023 billion as selling and administrative costs climbed, though nine-month cumulative after-tax profit held roughly flat at VND 713 billion.

Key Facts

• Q3/2026 net revenue: VND 1,023 billion, down 11% year-on-year.
• Q3/2026 after-tax profit: VND 98.5 billion, down 53% from VND 210 billion a year earlier; lowest since Q1/2011 (approximately VND 88 billion).
• Gross margin improved to 50.9% from 49%, with gross profit down 7% to about VND 520 billion.
• Selling expenses rose 23% to VND 314 billion; administrative expenses rose 16% to VND 96 billion.
• 9M/2026 net revenue: VND 3,584 billion (+~2%); after-tax profit VND 713 billion (roughly flat); pre-tax profit VND 839 billion (+~5%).
• 2026 targets: net revenue VND 5,530 billion and pre-tax profit VND 1,007 billion; 9M completion at 64.8% of revenue and 83.3% of pre-tax profit.
• Total assets at 30 September 2026: VND 4,410 billion, down about 15% from the start of the year; short-term financial investments fell by more than VND 1,021 billion to VND 1,064 billion.

What Happened

In its Q3/2026 financial statements, Dược Hậu Giang recorded net revenue of VND 1,023 billion, down 11% year-on-year. Cost of goods sold fell nearly 14% to VND 503 billion, but the saving was not enough to offset the revenue decline, leaving gross profit down 7% at roughly VND 520 billion. Gross margin nonetheless improved to 50.9% from 49% a year earlier.

Operating costs moved the other way. Selling expenses increased 23% to VND 314 billion and general and administrative expenses rose 16% to VND 96 billion, while financial income fell 22% to VND 28 billion. The company attributed the profit decline to lower net revenue, higher operating costs and an increase in corporate income tax, including the effect of global minimum tax rules. Nine-month net revenue reached VND 3,584 billion, up nearly 2%, with pre-tax profit up nearly 5% to VND 839 billion and after-tax profit essentially unchanged at VND 713 billion. The company also paid more than VND 1,300 billion in dividends during the period, contributing to a 15% decline in total assets.

Market Context

DHG closed at VND 87,500 on 27 October 2026 on the Ho Chi Minh City Stock Exchange (HOSE). The stock sits in the pharmaceuticals sector, a defensive segment of the Vietnamese market that has generally traded on stable domestic demand rather than cyclical growth. A quarterly profit print at a 15-year low tests that defensive reputation, particularly as the revenue miss came alongside rising selling costs rather than a one-off charge. The nine-month figures suggest the weakness is concentrated in the third quarter rather than spread across the year.

Strategic Significance

The core question for long-term holders is whether Q3 reflects a structural squeeze on branded domestic pharmaceuticals or a temporary cost and tax effect. The gross margin expansion to 50.9% argues that pricing and product mix remain intact, and the profit hit came below the gross line, from selling and administrative spending plus the global minimum tax. That distinction matters: if the cost increase is a deliberate push into new channels or a tax step-up, margins can normalize; if it signals eroding pricing power against imported and generic competition, the earnings base is lower for longer. The dividend payout of more than VND 1,300 billion also reduced the cash and term-deposit buffer that has historically supported DHG’s valuation.

What to Watch

• Q4/2026 financial statements, which will determine whether the company reaches its VND 1,007 billion pre-tax profit target (needs roughly VND 168 billion in the quarter).
• The trajectory of selling expenses as a percentage of revenue, to see whether the 23% increase is seasonal or structural.
• Any company disclosure on the global minimum tax impact and its expected annualized effect on the tax line.
• Cash and short-term investment balances after the dividend payout, given the VND 1,021 billion reduction in term deposits.
• Foreign ownership and major shareholder filings, with the price at VND 87,500 as of 27 October 2026.