Chairman of Vietnam Airlines Board of Directors: Self-effort is very important, helping us overcome difficulties

Mr. Dang Ngoc Hoa, Chairman of the Board of Directors of Vietnam Airlines Corporation (VNA), said that the airline will implement synchronous solutions to increase revenue and income, continue to resolutely implement cost management and optimization, improve resource efficiency, and ensure profitable business results. Efforts to handle more than VND 42,000 billion At the recent 2024 Annual General Meeting of Shareholders of VNA, Mr. Dang Ngoc Hoa revealed that for nearly 4 years (2020 - 2023), VNA has made efforts to resolutely implement solutions to comprehensively restructure the enterprise. The total value of these solutions reached VND 42,400 billion. Of which, VNA saved and cut costs by VND 18,118 billion, negotiated a reduction in rental prices from 2021 to the end of the lease term of more than VND 16,000 billion and deferred rental payments of more than VND 8,300 billion. This is considered a remarkable effort by VNA in the context of the consequences of Covid-19 from the period of 2020 - 2022 deeply affecting the production and business activities and financial situation of the airline. At the beginning of 2024, the accumulated loss of VNA's parent company was VND 32,522 billion, the burden of paying overdue debts, restructuring, short-term loans and refinancing from the previous period left about VND 22,000 billion. In the past time, VNA has developed and reported to competent authorities a restructuring project, including solutions to accelerate financial recovery and gradually eliminate accumulated losses.

In the second quarter of 2024, VNA's operations initially improved, with a consolidated profit of over 4,000 billion VND. Photo: VNA

In addition, the airline also reviewed and cut down non-urgent investment projects; delayed the progress of investment preparation to limit the arising of disbursement costs; delayed the bidding progress, reduced the investment scale, proactively negotiated, requested support and sharing from partners to delay the payment progress, while ensuring timely implementation of investment activities in equipment and infrastructure, without affecting or interrupting VNA's production and business activities. Along with that, VNA has strongly deployed information technology and digital transformation solutions, applying AI technology in all areas of operation. VNA has also reduced 4 unit-level focal points (at the parent company) and reduced 2,468 employees of VNA Group (equivalent to a 10% reduction), in particular, the parent company VNA reduced 1,080 employees (equivalent to a 14% reduction). However, to ensure resources for the recovery and development phase, VNA still focuses on retaining core, high-quality forces such as pilots, flight attendants, technicians, engineers, technical staff, experienced managers... Emphasizing the State's support for VNA, Mr. Hoa said that in addition to the general support policy mechanisms for airlines such as tax reduction, environmental protection fees, landing and take-off fees, as a State owner, VNA has received the mechanism of a 12,000 billion VND liquidity support package from the Government as an owner. Of which, there are 4,000 billion VND in refinancing loans and a plan to issue an increase in charter capital of 8,000 billion VND. Thanks to that, it has contributed to maintaining continuous operations for the airline during the severe consequences of the Covid-19 pandemic and ensuring cash flow for production and business plans, early recovery and step-by-step improvement of production and business efficiency for VNA. "Faced with unprecedented difficulties, we always realize that in "danger" there is always "opportunity". VNA is always aware of having to overcome difficulties from the enterprise's own internal resources. Only when all possible solutions have been implemented and the enterprise's resources have been maximized but still cannot and are not enough to cope, will the airline report to shareholders to promote its role and responsibility to support as a business owner and report to the Government to have solutions to remove difficulties for VNA in its role and mission as the National Airline of Vietnam" - Mr. Hoa affirmed. The goal of reducing losses and balancing revenue and expenditure In 2024, the world economy and politics will still be difficult with prolonged geopolitical conflicts, fuel prices and USD interest rates remaining high, affecting foreign exchange rates and input costs, in the context of many disadvantages in production and business activities, the Corporation has proactively implemented many synchronous solutions to ensure liquidity and continuous operation. Specifically, in the first quarter of 2024, VNA's operations initially improved, with a consolidated profit of over VND 4,000 billion, of which the parent company alone was VND 1,492 billion. Pacific Airlines negotiated debt reduction and debt forgiveness of nearly VND 6,000 billion with international creditors, contributing greatly to VNA Group's production and business results in 2024. In 2024, the aviation business environment will still face many challenges from the global geopolitical and economic situation, so VNA has developed key goals, directions, and tasks. Accordingly, the airline pays special attention to implementing the restructuring project, with comprehensive solutions on restructuring assets, capital sources, investment portfolio, organizational structure, and corporate governance innovation. The main goal is to reduce losses and balance revenue and expenditure in 2024. Along with that, VNA will expand its international flight network with new routes to Western Europe, maintain its main market share on key routes and increase capacity on tourist routes. At the same time, restructuring solutions focus on completing divestment at a number of member companies and submitting to competent authorities a plan to extend the repayment of refinancing loans. At the same time, VNA continues to report to competent authorities for approval and remove difficulties and obstacles in mechanisms and policies so that in the period of 2024 - 2025, VNA will implement plans to issue additional shares to increase charter capital in the form of issuing additional shares to existing shareholders or issuing individual shares to new investors to supplement capital and cash flow for production and business activities in the coming time.

Bao Ngan

Source: https://daibieunhandan.vn/doanh-nghiep1/chu-tich-hdqt-vietnam-airlines-no-luc-tu-than-rat-quan-trong-giup-chung-toi-vuot-kho-i376611/