Vietnam Airlines sets revenue target of over 105,000 billion VND in 2024

In 2023, Vietnam Airlines recorded consolidated revenue of VND 93,265 billion, nearly 30% higher than the same period of the previous year and approaching the peak level before the pandemic.

Mr. Dang Ngoc Hoa, Chairman of the Board of Directors of Vietnam Airlines - Photo: VNA

At the 2024 Annual General Meeting of Shareholders held on June 21st, Mr. Dang Ngoc Hoa, Chairman of the Board of Directors of Vietnam Airlines, reported that in 2023, Vietnam Airlines Group transported over 24.1 million passengers and 230,000 tons of cargo, an increase of 16.4% and 5.8% respectively compared to the same period. The international flight network recovered 90% . The positive operating results helped the airline achieve consolidated revenue of VND 93,265 billion, nearly 30% higher than the same period in 2022 and approaching the peak level of 2019. The consolidated pre-tax loss decreased by VND 5,583 billion, half the amount in 2022. According to Mr. Hoa, in 2023, the aviation industry continued to face many obstacles stemming from geopolitical conflicts disrupting supply chains, fuel prices remaining high above USD 105/barrel, and unfavorable fluctuations in interest rates and exchange rates. Domestic economic growth slowed down, leading to a weakening in travel demand this year. Internationally, key markets in Northeast Asia recovered more slowly than expected. Bright spots were the positive growth in Australia and India, and the strong recovery in Southeast Asia. Despite the significant cost pressures in the aviation industry, Vietnam Airlines' services have been continuously improved and received positive customer feedback. The airline has been honored with numerous prestigious international awards, including the "5-Star International Airline" award from The Airline Passenger Experience Association (APEX); and ranking among the Top 20 best airlines in the world for safety and service quality according to AirlineRatings. Vietnam Airlines received the World Travel Award in four categories: "Asia's Leading Airline for Economy Class," "Asia's Leading Airline for Cultural Identity," "Asia's Leading Airline for Crew Service," and "Asia's Leading Airline for In-Flight Magazine"... To achieve these results, according to Mr. Hoa, the airline proactively implemented a comprehensive set of self-help solutions, closely monitoring market developments. "The airline has restored its international flight network to approximately 90% of the 2019 level, opening new routes such as Hanoi/Ho Chi Minh City - Mumbai, Hanoi - Melbourne, and Ho Chi Minh City - Perth. The domestic flight network continues to operate with the same number of routes restored as in 2019," the Vietnam Airlines leader informed. Vietnam Airlines also focuses on cost management and thorough cost savings. In addition to reducing costs through economies of scale, the airline implemented cost-saving measures, negotiated price reductions, and deferred payments, resulting in estimated cost cuts of over 3.2 trillion VND. Simultaneously, Vietnam Airlines proactively restructured its loan portfolio and flexibly utilized short-term borrowings. The airline intensified its strategy of upgrading services, increasing the application of new technologies and software in various work processes and service touchpoints, not only boosting labor productivity but also enhancing passenger satisfaction. In 2023, the Customer Satisfaction Index (CSI) exceeded targets, with domestic CSI reaching 4.17 points and international CSI reaching 4.0 points.

In 2023, the Customer Satisfaction Index (CSI) exceeded its targets, with the domestic CSI reaching 4.17 points and the international CSI reaching 4.0 points.

Boosting Restructuring, Aiming for Revenue of Over 105,000 Billion VND. Recognizing the many challenges facing the aviation market in 2024, Mr. Hoa emphasized that Vietnam Airlines has established key objectives, directions, and tasks. In 2024, the airline aims for consolidated revenue exceeding 105,000 billion VND. "The airline is particularly focused on implementing the restructuring plan, with comprehensive solutions for restructuring assets, capital sources, investment portfolio, organizational structure, and corporate governance innovation. The major goal remains to reduce remaining losses and achieve a balance between revenue and expenditure in 2024." In 2024, the global economic and political situation will remain challenging with prolonged geopolitical conflicts and fuel prices remaining high at $104/barrel. High USD interest rates will also impact exchange rates and input costs. Global passenger traffic is projected to fully recover to 2019 levels, but the Asia- Pacific region, especially Northeast Asia, will need more time. Macroeconomic risks and airport infrastructure congestion remain potential threats. The global recall of engines by Pratt & Whitney is causing aircraft shortages and impacting operations. Domestically, Vietnam's economy is expected to grow steadily, with the domestic aviation market growing by 6%-8%. This provides a basis for Vietnam Airlines to continue setting ambitious goals of reducing remaining losses and achieving a balance between revenue and expenditure. To achieve this goal, Vietnam Airlines is implementing several comprehensive solutions. For the international market, the airline will expand its international flight network with new routes to Western Europe and Southeast Asia in 2024. For the domestic market, the airline will adjust flight frequencies to match market demand, maintain its main market share on key routes, and increase capacity on tourist routes. The company proactively develops operational plans based on various scenarios, enhancing its product and pricing management capabilities. Regarding its fleet, Vietnam Airlines focuses on preparing for investment in narrow-body aircraft projects and the conversion of A321ceo aircraft configurations to improve operational efficiency, meet market demands, and develop in line with its fleet restructuring plan. The corporation will also complete investment preparation for the integrated service complex at Long Thanh International Airport to move into the investment implementation phase. Vietnam Airlines aims for 5-star standards, expanding its "Service Enhancement" program to inspire and promote innovation. Simultaneously, it maintains strict cost-saving and management programs, seeking opportunities to negotiate reductions, deferrals, and postponements of payments. To maintain cash flow balance, Vietnam Airlines is accelerating divestment and implementing measures to optimize costs, revenue, and financial management effectively. The company continues to implement restructuring to mitigate the effects of the COVID-19 pandemic and lay the foundation for sustainable growth.

Phan Trang

Source: https://baochinhphu.vn/vietnam-airlines-dat-muc-tieu-doanh-thu-hon-105000-ty-dong-nam-2024-102240622085648213.htm