Vietnam Airlines records loss for 10 consecutive quarters

Vietnam Airlines made a loss over 10 consecutive quarters, with negative equity mounting to VND4,900 billion ($210 million), its Q2 consolidated financial report shows.

The national flag carrier lost VND2,568 billion ($110 million) in the second quarter, an improvement compared to the VND4,451 billion ($191 million) loss in the same period last year. This is the 10th consecutive quarter the company has reported a loss.

Its management said the company's Q2 loss decreased partly thanks to subsidiaries like Skypec, Vaeco, and Viags, which were all profitable.

Given the strong market recovery driven by the country’s tourism reopening post pandemic, Vietnam Airlines’ net revenue in Q2 was 2.8 times more year-on-year at VND18,323 billion ($785 million).

However, the company continued losing due to the sharp increase in fuel prices. At the end of June 2022, the price of Jet A1 gasoline exceeded $160 per barrel, more than double last year’s average.

In addition, the international market has not recovered as expected, especially Northeast Asia (South Korea, Japan) - an important revenue source before the pandemic.

Q2 this year recorded a sharp increase in the carrier’s expenses. Financial expenses reached VND1,147.5 billion ($49.16 million), up 171.4%; selling expenses, VND659 billion, a 112% rise; and management expenses, VND480.5 billion, up 5.9%.

The airline’s net revenue in the first six months reached VND29,944 billion ($1.28 billion), up 114% year-on-year. Its net loss hit VND5,118 billion ($219.3 million).

With its continued loss, the carrier’s accumulated loss has reached VND28,921 billion ($1.24 billion).

At its 2022 annual general meeting, Vietnam Airlines set a target of VND45,252 billion in revenue for the whole year and a net loss of VND9,335 billion ($400 million).

Vietnam Airlines is listed on the Ho Chi Minh Stock Exchange as HVN. The HVN shares were priced at VND16,500 ($0.71) a piece at the closing session last Friday.