ACG gets momentum in the local market

In contrast to domestic market revenues, ACG's export revenue in the third quarter of 2025 declined by 16% compared to the same time previous year owing to obstacles from US tariffs.

Domestic market drives revenue

Phu Tai Corporation (PTB), An Cuong Wood Corporation (ACG), and Vietnam Forestry Corporation (VIF) are the top three wood industry corporations listed on the Vietnamese stock exchange in terms of revenue and profit. Among them, PTB and AGC are well-known for their reputation, export products, and local consumption.

If PTB's wooden panels and quartz stones are popular in the export market, ACG's diversified wooden goods are gaining traction in both foreign and local markets. However, according to the business results for the third quarter of 2025, the sales in ACG's two markets are diametrically opposed. Domestic revenue, which accounted for more than 80% of ACG's total net sales of VND 1.177 billion, drove revenue growth throughout the quarter. As a result, ACG's net sales climbed by 13% in the third quarter compared to the same time the previous year, owing principally to an 18% rise in domestic revenue.

Meanwhile, due to US tariffs, ACG's export revenue in the third quarter fell 35% from the previous quarter and 16% from the same period last year. ACG's after-tax profit was VND 135 billion, a 4% rise over the same time previous year. This was achieved despite a fall in gross profit margin in the third quarter, owing principally to a decline in domestic profit margin. Over 9 months, ACG generated net revenue of VND 2,941 billion, up 6%, and after-tax profit of VND 358 billion, up 9% over the same time previous year.

ACG's domestic sales increase is especially significant given that the third quarter is traditionally a low construction season, with lesser demand for wood goods than other periods. Furthermore, the fall in domestic gross margin performance implies that ACG has opted to sacrifice a portion of its profit margin to increase domestic sales.

In other words, ACG is using local sales to offset the lower revenue from exports. This is not always a hint that ACG's decision favors domestic market interests, but it does indicate appropriate answers for firms in general when confronted with pressures from export markets. In truth, organizations with a strong domestic market will always have a backup plan for any business circumstance that necessitates flexibility and agility.

Opportunities go along with challenges.

With the ACG's said strategy, Vietcap sees a minor adverse risk to ACG's full-year gross profit margin prediction, since the gross profit margin in the first nine months of 2025 was 29.3%, lower than analysts' forecast of 30.2%.

However, many of ACG's business indicators are improving, including Selling, General, and Administrative (SG&A) expenses, which fell to 15.8% from 18.1% in the previous quarter and 17.3% in the previous year, owing to strong revenue growth and the fact that approximately 50-60% of SG&A expenses are fixed costs. This rate is projected to fall further when the peak season for construction and wood product use occurs in the fourth quarter.

Furthermore, although bad debt provisions resurfaced in the fourth quarter, they were tiny, and provision expenditures for the first nine months of 2025 were about VND 4 billion, which is negligible when compared to the first nine months of 2024. ACG continues to outperform its industry rivals and its own historical performance, with results after 9 months hitting a three-year high.

With the expectation for domestic revenue growth, owing mostly to the recovery of the domestic real estate market, ACG and other domestic wood firms are likely to continue to generate revenue and profit from product sales in 2026-2027. Furthermore, because tariff concerns for the wood sector have virtually been completely reflected and are likely to limit future volatility, ACG may proactively engage with partners to share tax burdens while increasing export orders in 2026.

Nonetheless, ACG risks remain a worry since the domestic consumer market, even during peak season, may not rebound as projected, particularly if real estate credit restriction and investment levies (second, third houses, etc.) are applied. Meanwhile, in terms of exports, markets such as the United States and those outside the United States where ACG supplies goods continue to face the risk of declining consumer demand, as well as increasingly stringent traceability requirements and green product standards, which necessitate significant investment and cost from businesses in order to maintain competitiveness.