Heavy investment in Long Thanh airport raises questions over ACV’s financial health

As Vietnam pushes ahead with the massive Long Thanh International Airport project, the financial position of its main investor, Airports Corporation of Vietnam (ACV), is coming under closer scrutiny as cash outflows accelerate.

In an extraordinary disclosure report released on March 5, ACV said the Ministry of Public Security's investigative agency had detained Vu The Phiet, chairman of ACV, and Nguyen Tien Viet, a board member and deputy CEO for alleged violations of bidding regulations causing “particularly serious consequences”.

ACV operates and manages 22 airports nationwide and serves as the main investor in many large aviation infrastructure projects. Among them, the Long Thanh airport development is the largest investment project currently undertaken by the company.

Capital spending accelerates

Component Project 3 of Long Thanh airport’s first phase, led by ACV, includes 15 construction packages with a total value of about VND86.36 trillion ($3.29 billion).

By the end of 2025, the company had recorded VND34.19 trillion in construction-in-progress related to the project, accounting for nearly all of the VND35.4 trillion in ongoing projects on its balance sheet. Compared with the total investment of nearly VND99 trillion ($3.77 million) for Component Project 3, the amount disbursed so far represents roughly one-third.

As construction accelerates with a target completion in the first half of 2026, financial pressure has begun to emerge.

At its 2025 AGM, ACV’s management said it planned to borrow about $1.8 billion to finance the Long Thanh project.

However, by the end of the fourth quarter of 2025, the company’s total borrowings remained largely unchanged from the start of the year at over VND9.71 trillion ($370.16 million), mostly consisting of long-term official development assistance (ODA) loans used to finance the Noi Bai International Airport Terminal 2 and Tan Son Nhat International Airport Terminal 2 projects.

The figures suggest ACV is still prioritizing internal funds rather than taking on new debt for Long Thanh.

Cash pressure emerges

Although long-term borrowing has not increased, pressure on cash flow has started to appear in other indicators.

Short-term liabilities rose from over VND7.63 trillion to nearly VND11.32 trillion ($431.33 million), driven largely by higher payables to contractors and accrued expenses. The increase indicates the company may be relying more heavily on trade credit and delayed payments to contractors to manage cash flow during peak investment periods.

According to its cash flow statement, ACV spent over VND29.49 trillion ($1.12 billion) in 2025 on capital expenditures for fixed assets.

Despite recovering nearly VND11.03 trillion ($420.32 million) in bank deposits and recording pre-tax profit of nearly VND14.92 trillion ($568.52 million), the company posted a net cash outflow of over VND2.09 trillion for the year. Cash and cash equivalents fell to VND4.24 trillion.

ACV has access to ODA loans with very low interest rates, ranging from 0.3% to 1.6% annually. However, as these loans are denominated in Japanese yen, currency fluctuations resulted in financial expenses of nearly VND1.09 trillion ($41.36 million) in 2025. At the same time, borrowing costs at domestic commercial banks remain relatively high.

Financing strategy under scrutiny

Overall, analysts say the key question for ACV is not whether the company has the financial capacity to complete the Long Thanh airport project.

Instead, the issue lies in how the company manages financial leverage and the timing of capital mobilization amid volatile borrowing costs and exchange rates.

If ACV raises debt too early, financial costs could increase significantly. But if it delays borrowing while disbursements accelerate, liquidity pressure could intensify.

Should the project be completed on schedule and enter operation quickly, Long Thanh airport is expected to become a major long-term growth driver for ACV. Achieving that goal, however, will require not only substantial funding but also strict project management, transparency and financial discipline throughout the implementation process.

On the unlisted public companies market (UPCoM), ACV shares closed at VND48,200 ($1.84) on Tuesday.

ACV reported a record net profit of VND12.07 trillion ($464.81 million) in 2025, up 3% from a year earlier. Its balance sheet expanded sharply as capital spending accelerated.

As of December 31, 2025, its total consolidated assets stood at more than VND90.9 trillion ($3.5 billion), up by VND13.6 trillion ($523.77 million) from the start of the year, reflecting a sharp shift toward long-term investment.