PAT Q3/2026 Net Profit Falls 46% as Duc Giang Chemicals Unit Cuts Costs

Overview

CTCP Phốt pho Apatit Việt Nam (ticker PAT), a subsidiary of Hóa chất Đức Giang (DGC), reported Q3/2026 net profit after tax of VND 59 billion, down 46% year-on-year, according to its quarterly financial statements. Revenue fell 13% to VND 440 billion as yellow phosphorus output declined and input material costs rose, dragging the nine-month net profit down 21% to VND 216 billion.

Key Facts

• Q3/2026 net revenue: VND 440 billion, down 13% year-on-year.
• Q3/2026 cost of goods sold: VND 376 billion, roughly flat versus Q3/2025; gross profit fell 51% to VND 64 billion.
• Q3/2026 pre-tax profit: VND 64 billion, down 45%; net profit after tax: VND 59 billion, down 46%.
• 9M/2026 net revenue: VND 1,379 billion, down 3%; pre-tax profit VND 230 billion, down 22%; net profit VND 216 billion, down 21%.
• Total assets at 30 September 2026: VND 942 billion, down 35% from the start of the year; cash and cash equivalents plus held-to-maturity investments: over VND 559 billion, down 33%.
• Total liabilities at 30 September 2026: VND 234 billion, down 73% from the start of the year, all short-term; short-term borrowings and finance leases VND 67 billion, down 62%.
• Equity at 30 September 2026: VND 708 billion, up 21%; charter capital unchanged at VND 250 billion.

What Happened

In its Q3/2026 financial statements, Phốt pho Apatit Việt Nam attributed the revenue decline to lower yellow phosphorus sales volume, while production costs rose because all input materials became more expensive. Cost of goods sold held near the prior-year level at VND 376 billion even as revenue fell, compressing gross margin sharply: gross profit dropped 51% to VND 64 billion.

Operating expense lines moved in different directions. Financial revenue fell 18% to VND 11 billion, financial expenses dropped 56% to VND 1.5 billion, and selling expenses fell 75% to VND 5 billion, while general and administrative expenses rose 14% to more than VND 4.7 billion. The company did not disclose a specific volume figure for yellow phosphorus output in the excerpt reviewed. The filing does not break out segment-level or product-level profit.

Market Context

PAT trades on UPCOM, the unlisted public company market, and closed at VND 72,900 on 24 October 2026, while parent Hóa chất Đức Giang (DGC) closed at VND 33,700. The result lands in a soft stretch for Vietnamese phosphorus and yellow phosphorus exporters, where output and input-cost swings have weighed on margins across the chemicals sector. PAT’s balance sheet shrank markedly, with total assets down 35% and liabilities down 73% since the start of the year, leaving the company in a net cash position of roughly VND 559 billion against VND 67 billion of short-term borrowings.

Strategic Significance

For long-term holders, the quarter tests the thesis that PAT is a low-leverage, cash-rich processor whose earnings track yellow phosphorus prices rather than balance-sheet risk. The 46% profit decline is a margin story, not a solvency one: gross margin compressed because revenue fell while cost of goods sold stayed flat, and the company simultaneously cut borrowings by 62%. The strategic question is whether input-cost inflation is cyclical or structural, and whether PAT’s position inside the DGC group gives it pricing or feedstock advantages that smaller apatite processors lack. A sustained recovery in yellow phosphorus volume, rather than further cost cuts, is what would restore the earnings base.

What to Watch

• Q4/2026 and full-year 2026 financial statements, expected in early 2027, for evidence of volume recovery in yellow phosphorus.
• DGC’s consolidated results, which will show how much of the group’s profit weakness stems from PAT versus the parent’s other chemical lines.
• Yellow phosphorus export price and volume data, which drive PAT’s revenue more than domestic demand.
• Any DGC disclosure on feedstock or apatite supply arrangements that could ease input-cost pressure at PAT.
• UPCOM trading liquidity and foreign-ownership filings for PAT, given the thin float typical of subsidiary listings.