Vietnam Airlines finalising $518mn capital injection

Vietnam Airlines (VN, Hanoi) Vietnam Airlines (VN, Hanoi) is finalising procedures on a VND4 trillion dong (USD173 million) government loan and an VND8 trillion (USD345 million) increase in charter capital, outgoing chairman Phạm Ngọc Minh revealed at the carrier’s annual general meeting on August 10. It has also negotiated with partners to postpone debt repayments totalling VND2.4 trillion (USD104 million) for 2020 and 2021, while Vietnamese banks have allowed a further VND775 billion (USD33.5 million) worth of delayed loan repayments, VnExpress reported. The company, in which the government owns a 86.19% stake, anticipates a VND15.1 trillion (USD650 million) full-year loss, having already recorded a loss of VND6.6 trillion (USD284 million) for the first six months. Now, a new spike in coronavirus infections in the country is threatening the ongoing resumption of flight operations. Traffic figures improved in June and July, and the carrier made over 500 domestic flights in the third week of July, CEO Dương Trí Thành told the gathering. It currently has 68 routes in operation, 50 of them domestic, the ch-aviation capacities module shows.Thanh estimated that between May and July the domestic market was at 90% of the capacity it operated in the same period in 2019, higher than Japan at 70% and China at 60%. But since the pandemic resurfaced in Vietnam on July 25, the number of Vietnam Airlines’ frequencies has fallen back to levels seen in early May. He predicted that domestic traffic for the last five months of 2020 would be down 30% year-on-year. “This second wave has not shut down Vietnam Airlines’ intentions to recover its business, but it has put more roadblocks on its path,” he said, adding that a plan to fully recover by 2022 may be set back. With Phạm Ngọc Minh retiring, shareholders voted at the meeting to install the current deputy chief executive, Đặng Ngọc Hoa, in the post with immediate effect. Board member Koji Shibata, a representative of ANA – All Nippon Airways (NH, Tokyo Haneda), which owns a 8.77% stake in the carrier, was replaced by Tomoji Ishii, senior vice president at ANA Holdings.