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Profitable 2014 for Vietnam Airlines

Released at: 11:25, 08/01/2015

Profitable 2014 for Vietnam Airlines

National flag carrier reports pre-tax profits increasing 28 per cent.

by Son Ho

Shipbuilding Industry Corporation (SBIC), Vietnam National Shipping Lines (Vinalines), Airports Corporation of Vietnam (ACV), Vietnam Airlines (VNA), Vietnam National Railways (VNR) – five major transport companies has not done well in 2014 according to their reports submitted to Ministry of Transport.


SBIC and Vinalines are two companies which suffered lost in 2014. Though the number was better than 2013, the amount is still huge.


SBIC's total revenue in 2014 was over VND7,640 billion, 30 per cent increase compared to the year plan. But in the end, SBIC still lost more than VND2,180 billion by the end of fiscal year 2014. In 2013 it lost VND6,400 billion, so they made a big step in one year.


Only sales and production value are two indicator that SBIC achieved the target. Production value reached VND5,700 billion. Sale revenue was more than $200 million with 76 ships handed over. In which, 33 ships were for exporting with the revenue of nearly $34 million. 43 ships were for domestic using, mainly modernizing fishery inspection vessels and steel-armored fishing vessels.


“Shipbuilding market of the company in 2014 is mainly for Damen Shipyards Group (Netherlands), Navy and fishing vessels,” said Mr. Vu Anh Tuan, General Director of SBIC.


Vinalines also had a negative number with an estimated lost of VND1,392 billion, 76 per cent decrease compared to 2013 (VND5,700 billion – highest lost in its operating history). Its business result of 2014 did not meet the year plan with total revenue only reached VND18,086 billion, equivalent to 77 per cent of revenue in 2013. The reason is mainly the revenue from temporarily importing for re-exporting service decrease significantly.


The good thing for Vinalines is that the exploiting activities of vessels in most member companies have begun to own an positive cash flow. Besides, though the seaports had revenue equivalent to 2013, the lose has fallen by 35 per cent.


VNA, VNR and ACV had a profitable year. However the numbers still reflect the issues they had.


ACV's pretax profit was VND1,256 billion, 5 per cent higher than the year plan. However, this is the third year in a row the profit has fallen. The profit of 2014 has dropped by 7.7 per cent compared to 2013. ACV is currently having the highest profit among the 4 big companies in transport sector. Total revenue of ACV in 2014 reached VND8,571.4 billion, 6 per cent higher than the year plan and 0.86 per cent increase compared to 2013.


VNA's revenue in 2014 reached VND71,790 billion, 2 per cent increase compared to 2013. Its contribution to the State Budget was VND2,936 billion and pretax profit was VND647 billion. Capacity was approximately 80 per cent, marking a 0.5 per cent increase against 2013, despite capacity declining in some markets.


Though the figures of 2014 were positive. VNA Board of Directors set up modest business indicators for 2015 with a total revenue of VND55,000 billion and profit of VND180 billion.


As for VNR, its total production value was VND9,230.9 billion, revenue was VND9,333 billion, pretax-profit was VND180 billion. Though it is not officially announced, a leader of VNR said the results mostly come from the parent company's activities.

The notable point is that the revenue from transporting passenger and freight of VNR has reached its peak because the transport ability is hard to improve any further. At the same time, it has to compete fiercely with other modes of transport such as air transportation and waterway transportation.


“Except for ACV, business forecast of other 4 big companies are relatively, especially VNA and Vinalines. They will greatly depend on the variation of oil prices which are very difficult to forecast," an expert predicted.




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