Vietnam Airlines JSC eyes comprehensive restructuring to weather COVID-19 crisis

The Vietnam Airlines JSC has drafted a set of seven solutions for comprehensive restructuring, which is waiting for approval from authorities, after another year struggling with COVID-19 impacts, according to Chairman Dang Ngoc Hoa.

The State-owned corporation, which owns national flag carrier Vietnam Airlines, low-cost Pacific Airlines and the Vietnam Air Services Company (VASCO), received refinancing loans worth VND4 trillion (US$175.63 million) at zero interest rate from the State Bank of Vietnam in the third quarter of 2021. The company later completed offering of 800 million shares to existing shareholders.

Despite these moves, more still needs to be done to get it through the COVID-19 crisis. In the first nine months of 2021, the company saw its revenue nosediving 42% to over VND18.73 trillion, according to the Vietnam Airlines JSC’s financial statement. Gross loss reached nearly VND11.83 trillion, compared to some VND8.07 trillion during the same period last year.

Ending the third quarter, its equity plunged 75.5% from the beginning of the year to just over VND1.47 trillion. This year, consolidated profit after tax amounted to minus VND14.52 trillion.

Hoa said the Vietnam Airlines JSC has come up with a set of seven solutions, including restructuring its fleet by deferring due payments; reducing aircraft leasing costs and postponing delivery of new aircraft; restructuring assets through aircraft liquidation and leaseback; restructuring investment portfolio; accelerating organizational and corporate governance restructuring; issuing additional shares; among others.

He also noted that the corporation has yet to decide to issue bonds at home or overseas.

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