On 27 June 2020, Vietjet Aviation Joint Stock Company held its 2020 Annual General Shareholders’ Meeting (AGM) to review its 2019 business results and audited financial statements, discussing the company’s plans for 2020.
According to the Executive Board’s report from the AGM, 2019 continued to cement the airline’s growth and indicated sustainable development with positive business results. 2019 also marked an important milestone in the new-age carrier’s journey as the airline celebrated its 100 million passengers transported by Vietjet thus far.
In 2019, the audited air transport revenue reached VND 41,252 billion (approximately USD 1.8 billion) and VND 3,869 billion (approximately USD 166 million) in profit before tax, an increase of 22 percent and 27 percent respectively compared to 2018. Vietjet’s consolidated pre-tax revenue and profit in 2019 were VND 50,603 billion (approximately USD 2.2 billion) and VND 4,569 billion respectively (approximately USD 196 million).
In particular, Vietjet’s ancillary revenue was VND 11,340 billion (approximately USD 487 million) in 2019, an increase of 36 percent compared to 2018. The portion of ancillary revenue from the airline’s total air transportation revenue also increased from 25.3 percent in 2018 to 30.4 percent in 2019, making Vietjet one of the top-ranking airlines globally in terms of ancillary revenue over total revenue ratio.
2019 milestones and achievements
In 2019, Vietjet added 34 new routes, increasing its flight network to a total of 139 routes composed of 44 domestic and 95 international routes. The airline carried more than 25 million passengers, reaching an accumulated passenger count of up to 100 million. In the same year, Vietjet’s Aviation Academy continued to invest and expand in line with the airline’s plans for sustainable development. The academy is now one of the region’s leading specialised institutions for modern aviation training.
Vietjet also received a number of prestigious awards in 2019, such as ASEAN’s Best Aviation Enterprise Award from ASIAN-BAC. The airline was also named ‘Asia Pacific Low-Cost Carrier of the Year’ by CAPA and is one of Vietnam’s 50 best-listed companies in 2019 by Forbes. Vietjet was also listed in the Top 50 airlines for healthy financing and operations for the second consecutive year by AirFinance Journal. These achievements in 2019 have helped Vietjet become a major airline in Vietnam’s aviation industry as well as in the region.
2020 outlook and development plans
Vietnam’s aviation industry has been impacted severely since the beginning of 2020 in the wake of the Covid-19 pandemic. The country has since resumed all domestic operations and is projected to be on its way to recovery.
With domestic flights resumed in Vietnam, Vietjet introduced the “Returning to the sky” campaign and inaugurated eight new routes, increasing its domestic flight network to a total of 53 routes. Thai Vietjet was also the first airline to reopen operations in Phuket Airport, expanding its network with five new domestic routes in Thailand. With the resumption and expansion of domestic flights, Vietjet and the Vietnamese aviation industry are ready for the return to international skies from July with precautions in place to ensure medical safety for its passengers and staff.
The Vietnamese government is currently implementing a number of initiatives to support airlines, such as tax and fee reductions and loans with low rates. With the government’s support, it is expected that Vietjet will be able to operate 90 aircrafts with over 118,000 flights to transport more than 20 million passengers by the end of 2020.
Vietjet is aiming for its core business of air transport to reach break-even point by the end of 2020. The airline will prioritise its resources on cost-optimising solution with measures such as such as fostering cargo services, aircraft purchases, diversifying credit loans solutions and expanding self-serving ground operations. The carrier will also continue to grow its customer base and activities on its e-commerce platforms while digitally transforming its operating systems and procedures with advanced management software and technology.
Despite the current challenging climate in the aviation industry globally, Vietjet shareholders are looking to vote on paying the dividends for 2019 up to 50 percent by share. The positive business results are an indication of the airline’s growth with a robust business strategy and management systems, and the airline is looking forward to upcoming opportunities for development in 2020.