VietNamNet Bridge – Airports Corporation of Vietnam (ACV) is expected to lease the passenger terminal at Phu Quoc International Airport to a private firm, instead of transferring the right to operate the entire airport as earlier planned by the Ministry of Transport.

Illustrative image -- File photo

Vu Anh Minh, head of the ministry’s Enterprise Management Department, told the Daily about the change of heart at a roadshow held in HCMC on November 23 to introduce ACV shares to investors. A similar event was organized in Hanoi last week.

Three domestic investors have proposed buying the right to operate the whole airport after the ministry floated the plan. However, Minh said on November 23 that the Government and the ministry had disapproved of the entire airport being leased out.

“ACV is drawing up a leasing plan for the terminal including rent and lease duration. How the terminal is leased will depend on negotiations between ACV and interested investors and on the final say of the Government and the ministry,” Minh said.

Many investors at the roadshow on November 23 said they wanted to know more about ACV’s plan to sell State shares at the corporation.

Le Manh Hung, general director of ACV, said that after ACV goes public, a sale of State shares would be decided by its shareholders based on business performance and development of airports.

Regarding ACV’s upcoming investment plans, the corporation’s chairman, Nguyen Nguyen Hung, said in addition to the Long Thanh international airport project in Dong Nai Province, the corporation would upgrade and expand HCMC’s Tan Son Nhat airport, Danang airport in Danang City, Chu Lai airport in Quang Nam Province and Phu Quoc airport.

He said when Long Thanh airport is up and running, ACV would operate both Long Thanh and Tan Son Nhat at the same time, with the former expected to handle 80% of international flights.

ACV will sell 77.8 million shares, 3.47% of chartered capital, at an initial public offering (IPO) on December 12 at the starting price of VND11,800 per share.

ACV will have chartered capital of VND22.43 trillion, equivalent to more than 2.24 billion shares, after the corporation goes public. Of these shares, 1.68 billion (75%) would be held by the State, while 448.62 million (20%) would be sold to strategic investors, 77.8 million (3.47%) to ordinary investors and the remainder to its employees and labor union.

At the roadshow in Hanoi last week, chairman Hung said just some of 22 international and domestic airports under the management of ACV can make profit and half of them generate small revenues.

ACV’s report released last week showed aviation services (passenger, takeoff-landing and ground services) contributed 81% to its revenue in the 2012-June 2014 period.

Revenue of the segment grew by 13% annually in 2012-2014 and picked up 35% year-on-year in the first half of this year thanks to growth of 21% in the number of passengers. The number has grown 16% annually on average.

The report revealed 2014 revenue of the airports. Tan Son Nhat took the lead with 22.15 million passengers handled last year, 110% of its capacity, and obtained revenue of around VND3.58 trillion, which made up 40% of ACV’s aviation services revenue.

Tan Son Nhat was followed by Noi Bai airport with around VND2.46 trillion last year though the international airport in Hanoi reached only 57% of its designed capacity. Respective revenues of Danang, Cam Ranh and Phu Quoc airports were VND679 billion, VND285 billion and VND99 billion.

However, 14 of the airports earned less than VND56 billion per year and Ca Mau airport in the southernmost province of Ca Mau generated a mere VND2.43 billion annually.

Hung said Tan Son Nhat and Noi Bai are the most profitable airports but he did not give exact figures. Meanwhile, Danang International Airport can break even.

ACV boasted that revenue growth from the airports would be higher as aviation growth will continue.

ACV cited projections by the International Air Transport Association (IATA) as saying that Vietnam will see the highest aviation growth rate in Asia-Pacific towards 2034 with an annual rate at 7.3%.

ACV forecast aviation revenue will reach VND8.2 trillion this year and over VND11.12 trillion in 2020, or 8% annually, owing to the increasing number of international passengers and service fares adjusted up in October last year.    

Le Anh and Ngoc Lan

Source: SGT