Vietnam Airlines expects financial difficulties until 2023-end
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Vietnam Airlines expects financial difficulties to last until the end of 2023, amid aftermath of the Covid-19 pandemic.
The flag carrier targets to be profitable and turn around its negative equity this year, it said in a filing to the Ho Chi Minh Stock Exchange, on which its stock HVN is still restricted to trading in the afternoon due to loss reports.
The airline has recorded an accumulated loss of over VND24.5 trillion ($1.05 billion) as of March, and it wants to turn this situation around and become profitable by 2024 onward.
It had recently sold a 35 percent stake in Cambodia Angkor Air for $35 million and will sell the remaining stake (14 percent) this year.
It is set to issue more shares to pump up its capital in 2023 or 2024. In September last year, it raised nearly VND8 trillion by share issuance. The airline said it has been benefiting from a strong rebound in domestic travel.
Last month, it operated nearly 12,000 flights and transported two million passengers, exceeding its plan by 42 percent.
International travel, however, has been affected by the Russia-Ukraine crisis and rising fuel prices, the airline said.
The Vietnamese government owns a more than 86 percent stake in Vietnam Airlines through two entities. Japan’s ANA Corporation owns a 5.6 percent stake.
Questions & Answers
Q.What is the airline's target for its financial performance this year?
What is the airline's target for its financial performance this year?
Vietnam Airlines aims to become profitable and reverse its negative equity position by the end of this year. It hopes to maintain profitability from 2024 onwards, according to a filing with the Ho Chi Minh Stock Exchange.
Q.How much accumulated loss has Vietnam Airlines reported?
How much accumulated loss has Vietnam Airlines reported?
As of March, the airline has recorded an accumulated loss exceeding VND24.5 trillion, which translates to $1.05 billion. This figure is prompting the airline's efforts to turn its financial situation around.
Q.What actions has Vietnam Airlines taken to raise capital or improve its finances?
What actions has Vietnam Airlines taken to raise capital or improve its finances?
The airline recently sold a 35 percent stake in Cambodia Angkor Air for $35 million and plans to sell the remaining 14 percent this year. It also raised nearly VND8 trillion through a share issuance last September.
Q.Which factors are negatively impacting Vietnam Airlines' international travel business?
Which factors are negatively impacting Vietnam Airlines' international travel business?
International travel for Vietnam Airlines has been affected by the ongoing Russia-Ukraine crisis. Also, rising fuel prices are contributing to the difficulties faced by its international operations.
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