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Airports Corporation of Việt Nam aims for 9 per cent higher profit

Update: June, 24/2019 - 09:00
The Airports Corporation of Việt Nam (ACV) has targeted earning VNĐ19.1 trillion (US$820 million) in revenue and VNĐ8.2 trillion ($355 million) in pre-tax profit in 2019, representing year-on-year increases of 7 per cent and 9 per cent. — Photo tbck.v

HÀ NỘI — The Airports Corporation of Việt Nam (ACV) has targeted earning VNĐ19.1 trillion (US$820 million) in revenue and VNĐ8.2 trillion ($355 million) in pre-tax profit in 2019, representing year-on-year increases of 7 per cent and 9 per cent.

ACV holds a positive view of the growth trajectory of the Vietnamese air transport market thanks to the participation of new domestic airlines and the addition of international flights to Phú Quốc, Phú Yên and Phù Cát, said ACV General Director Vũ Thế Phiệt at the company’s 2019 Annual General Meeting of Shareholders in HCM City on Saturday.

However, the company is expected to encounter some difficulties related to competition from the private sector, policies on flight zones, investment rights and delayed land procedures, along with increasing electricity and fuel costs and the unstable global political situation.

Therefore, AVC expects revenue growth for both aviation and non-aviation services to be lower than last year, Phiệt said. Aviation service revenue will continue to rise but the increase will be lower than in 2018 due to lower international revenues from Cam Ranh Airport.

Non-aviation revenue is also expected to report lower growth than last year. In 2018, many new facilities were completed and put into operation, but this year, most new projects are still preparing for investment. The company aims to raise non-aviation service revenue to 40 per cent of its total revenue in the next few years, Phiệt said.

In 2018, profit increased sharply thanks to the policy of increasing service prices under Decision 2345 of the Ministry of Transport. The company recorded total revenue and post-tax profit of VNĐ17.8 trillion and VNĐ6 trillion, up 19 per cent and 44 per cent respectively against 2017.

Phiệt said the company has submitted a feasibility study for the first phase of construction for Long Thành International Airport. It is awaiting review before sending the study to the National Assembly for approval in October, 2019.

Lại Xuân Thanh, Chairman of ACV, said that the plan to list on the HCM Stock Exchange depended on the company’s equitisation process. ACV needs to assess the value of its assets and State assets before it can move forward with equitisation.

New terminals

In 2019, ACV will continue to invest in infrastructure to meet the needs of airlines with investment capital of more than VNĐ7.3 trillion, including to fund the construction of terminal T3 at Tân Sơn Nhất Airport in HCM City, the project to expand terminal T2 at Nội Bài Airport and the terminal T2 project at Cát Bi Airport in Hải Phòng province.

Phiệt said the feasibility study for the new terminal was nearly finished. The terminal is expected to have an annual capacity of 20 million passengers, one station and one high rise garage. It is expected to cost VNĐ11.5 trillion in total. 

Phiệt said the company is still struggling to secure enough funding to complete the project. It has asked to Government to allow it to construct the terminal and serve as its investor. — VNS

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