Sky’s the limit for Vietnam Airlines

Based on strong GDP growth in Vietnam, an expanded fleet and other positive factors,
VNA has high hopes for 2016

The airline (VNA) stated that it aimed to make pre-tax consolidated profits of over VND2.32 trillion ($106.4 million) for 2016, up 65 per cent from last year.

The 2016 profit target carries the momentum of optimism from VNA’s consolidated pre-tax profit in 2015, which hit an all-time record high of VND1.4 trillion ($64.2 million), up 194 per cent from 2014 and exceeding the yearly target by 129 per cent.

VNA also aims to make a consolidated revenue of VND77.8 trillion ($3.56 billion) and handle 19.2 million passengers in 2016, posting on-year increases of 12.2 and 10.6 per cent, respectively.

Pham Viet Thanh, chairman of VNA’s Board of Directors, ascribed the airline’s high expectation to Vietnam’s GDP predicted to expand 6.7 per cent in 2016, the highest level over the previous six years. Additionally, the international aviation industry was also forecast to recover significantly, driven by stronger growth forecasts for some key economies.

Thanh also revealed that negotiations with an unnamed Japanese investor on the stake sale in VNA had been completed, and that the two sides were likely to sign an agreement in the first quarter of 2016.

Thanh added that the airline would continue its equitisation plan this year, with a focus on completing the sale of stakes to a strategic investor, and on non-core business divestment as well. As of late 2015, VNA earned VND819 billion ($37.57 million) through divestment from non-core businesses.

Last year, VNA became the first carrier in the Asia-Pacific region to operate the Airbus A350-900 and Boeing 787-9, the two most modern aircraft in the world.

The airline also handled nearly 17.4 million passengers and conducted 127,500 safe flights this year, surpassing its 2015 targets by 4.8 per cent and 3.5 per cent respectively.

The airline also finished out 2015 with an expanded flight network that includes 57 international flight routes to 29 destinations and 39 domestic flight routes to 21 destinations. It also increased its fleet, up from 76 aircraft in 2011 to 97 by the end of 2015.

According to a report by the Civil Aviation Authority of Vietnam released in October 2015, VNA still holds the lion’s share (47.6 per cent) of the domestic market, though this rate dropped 9 per cent from 56.6 per cent in 2014.