Restructuring delays Vietnam Airlines financial statements: company

Vietnam Airlines has blamed the delay in announcing its audited financial statements for 2022 on “comprehensive restructuring and stabilizing production and business activities.”

Its auditing company was working “urgently” on the financial statements and the airline will release them as soon as they are completed, the national flag carrier said.

The “collection and comparison of documents took a long time” because of the ongoing restructuring process, it explained.

In addition, during the Covid-19 period, the airline had negotiated price reductions and delayed payments with many suppliers and it needed more time to compare resultant contractual changes and confirm its dues. This has also led to the delay in issuing financial statements, Vietnam Airlines said.

The Ho Chi Minh Stock Exchange (HoSE) switched the status of Vietnam Airlines’s HVN shares from controlled to restricted trading from July 12, due to the delay in submitting its 2022 audited financial statements.

In Vietnam, a public company must release its audited annual financial statements within 10 days from the date they are signed, but no more than 90 days from the end of the fiscal year. Vietnam Airlines has missed these deadlines.

On March 29, the airline submitted an application to the State Securities Commission (SSC) and HoSE asking for a postponement. However, the corporation did not specify an intended date for submission.

Citing the large scale of its global operations, with 27 affiliated units (nine domestic and 18 foreign branches) and 15 large- or medium-scale subsidiaries operating in other fields, the airline argued that it needed more time to verify reports and collect data to meet auditing standards, especially since it was restructuring its business operations to overcome the impacts of the pandemic.

However, the SSC did not agree, saying the reason was not a natural disaster, fire, pandemic, war or other force majeure event.

Vietnam Airlines reported a loss of VND37.3 billion ($1.59 million) in Q1/2023, significantly better than the loss of VND2.69 trillion ($114.45 million) in the same period last year. Its net revenue of VND23.49 trillion ($1 billion) was up 102% year-on-year and its highest quarterly revenue since 2020.

In 2022, the state-owned carrier suffered a net loss of VND10.37 trillion ($442.2 million) although its revenue of VND71 trillion ($3.03 billion) was 2.5 times higher than that of 2021 and more than 70% of pre-pandemic 2019.

As of December 31, 2022, Vietnam Airlines had negative equity of VND10.2 trillion ($425 million).

HVN closed Tuesday at VND13,050 ($0.55) per share.