Vietnam Airlines reports $154 mln Q3 loss
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National flag carrier Vietnam Airlines recorded a net loss of over VND3.5 trillion ($154.3 million) in the third quarter, a sharp decrease compared to the first two quarters.
According to a summary of consolidated financial statements for the third quarter, Vietnam Airlines earned net revenues of VND4.7 trillion, down 37.6 percent year-on-year.
The sale of goods dropped 20 percent year on year to VND7.7 trillion.
The airline reported a total gross loss in the sale of products and services of about VND3 trillion.
While its financial revenue more than quadrupled over the same period to more than VND560 billion, administrative expenses and costs related to the cost of products increased to more than VND347.5 billion and VND282.2 billion, respectively, resulting in the reported net loss.
The Q3 loss was less than the losses of VND4.9 trillion and VND4.4 trillion recorded in the first and second quarter, respectively.
Its loss in the first 9 months of the year has crossed VND12.1 trillion.
The carrier explained that the sharp drop in consolidated profits in the third quarter was not only due to the decrease in profits of the parent company, but also because the profits of subsidiaries providing aviation services, like Vietnam Airlines Engineering Company (VAECO) and Noi Bai Airport Services Company (NASCO), also decreased sharply.
Vietnam Airlines said that it has proactively implemented drastic solutions in business operations to minimize the impacts of the Covid-19 pandemic, resulting in a significant drop in Q3 losses compared to the first two quarters.
As of September 25, the carrier increased its charter capital to VND8 trillion.
The carrier said business activities have gradually stabilized and it is preparing conditions for the recovery and development phase after domestic flights are allowed to operate normally.
As of September, Vietnam Airlines’s total assets were valued at more than VND67 trillion, up more than VND4.5 trillion over the beginning of the year.
The company has posted overdue debts of VND65.5 trillion compared to the beginning of the year, and more than VND1.4 trillion of equity, a decrease of nearly VND4.6 trillion over the same period. Of this, short-term debt is about VND42.2 trillion, up more than VND9.7 trillion.
Questions & Answers
Q.What contributed to the significant net loss recorded by Vietnam Airlines in the third quarter?
What contributed to the significant net loss recorded by Vietnam Airlines in the third quarter?
The net loss was primarily due to a sharp decrease in profits for both the parent company and its aviation service subsidiaries, including Vietnam Airlines Engineering Company and Noi Bai Airport Services Company.
Q.How did the third-quarter loss compare to previous quarters, and what was the total loss for the first nine months?
How did the third-quarter loss compare to previous quarters, and what was the total loss for the first nine months?
The third-quarter loss of over VND3.5 trillion was less than the losses reported in the first and second quarters. The total loss for the first nine months of the year exceeded VND12.1 trillion.
Q.What actions has Vietnam Airlines taken to mitigate the impact of the pandemic on its operations?
What actions has Vietnam Airlines taken to mitigate the impact of the pandemic on its operations?
The carrier has implemented drastic solutions in business operations to minimise the impacts of the Covid-19 pandemic. These efforts resulted in a significant drop in Q3 losses compared to the initial two quarters.
Q.What is the current state of Vietnam Airlines' total assets and overdue debts?
What is the current state of Vietnam Airlines' total assets and overdue debts?
As of September, total assets were valued at over VND67 trillion, an increase from the start of the year. The company reported overdue debts of VND65.5 trillion and short-term debt of about VND42.2 trillion.
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