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Mon, 1 February 2021

Vietjet Reports VND274 Billion Profit in Q4 2020

(01 Feb 2021) Vietjet Aviation has reported VND4,430 billion (approx. US$192 million) of consolidated revenue in the fourth quarter of 2020 and a total of VND18,210 billion (approx. US$790 million) of consolidated revenue in 2020.

After-tax profit of Vietjets parent company was VND274 billion (approx. US$11.9 million) in Q4/2020 while consolidated after-tax profit reached VND995 billion (approx. US$43 million).

In 2020, Vietjet recorded a consolidated after-tax profit of VND70 billion (approx. US$3 million), making it one of the few airlines in the world which has not reduced staff numbers and yet still made a profit.

Ancillary revenue accounted for nearly 50% of the airlines total revenue.

Vietjet Airbus A320 reg: VN-A662. Picture by Steven Howard of TravelNewsAsia.com Click to enlarge.

Vietjets total assets reached VND47,036 billion (approx. US$2 billion) while its owner equity was at VND17,326 billion (approx. US$746.2 million) including treasury shares. Debt-to-equity ratio stayed as low as 0.66 while the liquidity ratio remained at 1.2.

Last year, Vietjet converted some of its passenger aircraft into freighters while applying new operational methods to strengthen its cargo service capacity. The airline was the first in Vietnam to be approved to deploy cargo operations in the passenger cabin (CIPC). It has since delivered more than 60,000 tons of cargo internationally, seeing its freight revenue leaping by 75% in Q4/2020 year-on-year. In 2020, 16% of air cargo growth was recorded. Through interline agreements, Vietjets cargo also landed in America and Europe for the first time.

In 2020, the airline also launched Vietjet Ground Services Center (VJGS) at Noi Bai International Airport (Hanoi), which has helped the airline better manage its operating costs while improving the brand recognition and service quality.

The airline has also introduced a series of new products and services to improve the convenience for passengers, which includes the unlimited Power Pass, the upgraded Power Pass Skyboss or SkyBoss and Deluxe classes with better flying privileges.

Vietjet has made drastic cuts to operating expenses by optimizing fleet operations with a 10% cost reduction, negotiating a 20%-25% discounts with suppliers while bringing down at least 10% of daily operating costs.

The airline also successfully hedged jet fuel in May 2020, helping to save 25% of fuel costs compared to buying at the market price.

Vietjet has decided to transfer its investment portfolio and a number of assets accumulated beforehand to gather capital and cash and nurture its resources for a strong recovery once the aviation industry bounces back.

The airline conducted 78,462 flights with 120,093 safe flight hours, flying more than 15 million passengers last year.

Last year, load factor was over 80% while on-time performance rate stayed at 90%, one of the highest in the world. Vietjets technical reliability rate stood at 99.64% and received the highest safety ranking of 7 stars.

Vietjet has so far resumed its entire domestic network of more than 47 routes. The airline has received support from the Government for tax discounts, tax-payment extensions and reductions in landing/take-off fee, ground services fee and air control fee, and is being considered for the governments financial aid proposal for local airlines.

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