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Vietnam Airlines reports huge losses

Vietnam Airlines Group, listed as HVN on the HCM Stock Exchange, earned nearly VND24 trillion (US$1.04 billion) in total consolidated revenue in the first nine months of this year, marking an estimated loss of VND10.75 trillion, 

 

said Tran Thanh Hien, the Chief Accountant of the Vietnam Airlines Department of Finance and Accounting. 

Vietnam Airlines Group, including Vietnam Airlines, Pacific Airlines and VASCO, still took the leading position in the domestic market with 51.7 per cent market share in passenger transportation. — Photo Vietnam Airlines

Hien was speaking at a press conference held in Ha Noi on Tuesday.

He said the group’s third quarter revenue was 32 per cent compared with the same period last year, even though it was normally the peak quarter with the highest revenue of the year.

“The aviation industry is in an extremely difficult time. Around the world, many airlines have to sell their assets, including key businesses such as catering and maintenance services. There are even companies selling their headquarters or renting them out to survive,” Hien said.

Facing such difficulties, Hien said the carrier had taken initiatives to solve the impacts of the COVID-19 pandemic, seeking financial solutions since the outbreak began and the cash flow declined rapidly, including cost cutting. “We have also proposed shareholders, including the State which owns an 86 per cent of stake, to give us assistance.”

“We are proactively seeking and taking advantage of every opportunity to increase revenue, such as promoting cargo transportation and charter flights to carry Vietnamese passengers back home and expert visitors, and selling old aircraft,” he added.

Hien said Vietnam Airlines had cut up to VND5.34 trillion in costs, of which the most difficult decision was to cut wages and reduce the number of workers. At the same time, the group also worked with banks to restructure loans and delay the repayment periods.

“This is how Vietnam Airlines can ensure liquidity, maintain operations and survive.”

At the conference, Hien also denied reports that Vietnam Airlines was filing for bankruptcy. “This information is wrong. We are doing our best to overcome the crisis.”

Despite the outbreak, Vietnam Airlines Group, including Vietnam Airlines, Pacific Airlines and VASCO, still took the leading position in the domestic market with 51.7 per cent market share in passenger transportation.

In the January-September period, the group conducted 46,700 safe flights, transporting nearly 11.9 million passengers and 146,000 tonnes of goods.

Although the third quarter of this year recorded positive growth in passenger volume compared to the second quarter, the group’s result is still at a very low level due to the fact that the international aviation market has not been reopened fully. Meanwhile, domestic airlines increased load factor and implemented many stimulus programmes to promote tourism according to the Government’s major goals.

Vietnam Airlines is currently exploiting more than 60 domestic routes with an average of 300 flights per day. Domestic passenger volume exceeded 12 per cent over the same period last year, marking an impressive recovery since the second wave of COVID-19 in July in Da Nang.

During this period, Vietnam Airlines and Pacific Airlines operated more than 100 return commercial flights carrying more than 30,800 Vietnamese citizens back home from nearly 30 countries, conducted more than 2,600 cargo flights, including free-of-charge medical equipment, to all parts of Viet Nam and many countries, contributing to ensuring trade and supporting prevention of the outbreak on a global scale.

Director of Vietnam Airlines Communication Department Dang Anh Tuan said the passenger transport activities of Vietnam Airlines were recording positive changes in the context of rapid and effective control of the disease by the Government. The domestic market had recovered and some international routes had been reopened under strict control and prevention of the outbreak.

“Vietnam Airlines is ready to open international routes and additional domestic routes right after the Government gives the green light to the aviation industry. We have prepared to bring the best and safe services to all passengers,” Tuan said.

In the last months of the year, Tuan said the group would continue to closely monitor disease developments and follow the market to have an appropriate plan to restore the flight network, ensuring the highest priority to pandemic prevention and meeting the travel demand of passengers. — VNS

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