Vietnam Airlines records first half profit, debt still a 'headache'?

Vietnam Airlines’ business performance has improved significantly with profits increasing sharply in the first half of the year. However, the financial balance sheet remains challenging as short-term debt was still 2.6 times higher than short-term assets at the end of June 2025.

Vietnam Airlines records profit in first 6 months of this year - Photo: VNA

Vietnam Airlines' cost of goods sold increased lower than revenue growth rate

According to the recently announced consolidated financial report for the second quarter of 2025, Vietnam Airlines Corporation recorded positive business results.

Specifically, Vietnam Airlines achieved net revenue of VND27,968 billion in the second quarter, an increase of more than 13% over the same period in 2024. Meanwhile, the cost of goods sold increased lower - only 5%, so the airline's gross profit reached VND4,948 billion, nearly 1.8 times over the same period.

During this period, Vietnam Airlines' financial expenses decreased, but sales and administrative expenses both increased.

After deducting expenses, the company's pre-tax profit reached more than VND3,058 billion, 2.6 times higher than the second quarter of last year. And the after-tax profit was VND2,922 billion, an increase of more than 2.8 times.

In the first 6 months of 2025, Vietnam Airlines recorded consolidated net revenue of more than VND 58,519 billion, an increase of more than 11% over the same period last year.

Pre-tax profit reached VND6,682 billion, up 19.3% and the highest level in the first half of the year that the airline has ever achieved. The business results shown in the financial report also exceeded the expectations of Vietnam Airlines' leaders.

At the 2025 annual shareholders' meeting held at the end of June, Vietnam Airlines estimated to achieve more than VND22,100 billion in revenue in the second quarter, pre-tax profit of the parent company alone was about VND1,000 billion, and consolidated profit was about VND1,600 billion.

Thus, after only 6 months, the airline has exceeded its profit plan for the whole year of 2025 (the target was 5,554 billion VND). This achievement is also double the record profit that the national airline recorded in the pre-pandemic period of 2017-2019.

However, after several years of heavy losses during the pandemic, Vietnam Airlines still had an accumulated loss of more than VND 33,613 billion at the end of June 2025.

What is Vietnam Airlines' debt situation that requires debt restructuring until the end of 2027?

Regarding the financial situation, Vietnam Airlines' total assets at the end of June 2024 were VND 62,240 billion, up 7% after 6 months. Of which, short-term assets accounted for VND 21,948 billion.

On the other side of the balance sheet, the national airline's liabilities amount to VND65,340 billion, but most of it is short-term debt of VND57,175 billion (accounting for more than 87%). Short-term loans and financial leasing debt alone are VND14,218 billion, which has only decreased by more than VND90 billion after 6 months.

This leads to a relatively "tense" imbalance when short-term debt is 2.6 times higher than short-term assets.

Regarding Vietnam Airlines, the Governor of the State Bank recently issued Circular No. 16, amending and supplementing a number of articles of Circular No. 04/2021 on restructuring debt repayment terms, debt classification and risk provisioning.

In which, Article 12 of Circular 16 stipulates that credit institutions shall restructure the debt repayment period for Vietnam Airlines' debt within a maximum period of no later than December 31, 2027, based on the request and assessment of the enterprise's debt repayment capacity.

Thus, the debt repayment restructuring period for Vietnam Airlines' loan is extended by 3 years, compared to the provisions of Circular No. 04/2021.

During the restructuring period, credit institutions shall classify debts and set up risk provisions according to the Prime Minister 's decision on asset classification, risk provision level, risk provision method and use of provisions to handle risks for Vietnam Airlines' debts due to the impact of the COVID-19 pandemic.

According to Circular No. 16, the State Bank re-finances credit institutions after the credit institutions lend to Vietnam Airlines according to the National Assembly 's resolution and the Government's resolution.

The maximum refinancing amount for each loan shall not exceed the loan amount of each loan according to the refinancing request of the credit institution. The total refinancing amount for credit institutions shall be a maximum of VND 4,000 billion.

BINH KHANH

Source: https://tuoitre.vn/vietnam-airlines-lai-ki-luc-nua-dau-nam-no-van-nhuc-dau-20250801012318948.htm