Vietjet bounces back in the first quarter of 2021
Vietjet Aviation Joint Stock Company has released its financial results for the first quarter of 2021 with positive indications of recovery.
Accordingly, the quarterly revenue and post-tax profit of Vietjet's parent company totaled VND2,845 billion (approx. US$123.3 million) and VND110 billion (US$4.77 million) respectively. Its consolidated revenue and consolidated post-tax profit for Q1/2021 were VND4,048 billion (US$175.7 million) and VND123 billion (US$5.3 million) respectively. Vietjet gained such profit from investments in finance and projects and develop new aviation services to offset the stagnant air transport business.
Vietjet has also transferred all of its owned treasury shares in the first quarter to strengthen its balance sheet and cash flow in support of the air transport sector.
The airline still maintained its efficient cost control through innovative and creative programs and measures to cut back on expenditures while optimizing fleet operations with a 52% of cost reduction and a year-on-year decrease of 39% of costs for ancillary sale and administration.
Vietjet has transported nearly 3.6 million of passengers on more than 21,000 flights over the first three months of the year. Its On-time Performance (OTP) rate has stayed at the global high of over 90%.
Vietjet was one of the first airlines to have fully resumed the domestic flight network and even opened more new routes to meet the increasing travelling demand post-Tet holiday and in the summer. Such routes have helped localities to kick-start their economic recovery.
The airline has also introduced several promotions including the zero Vietnam-Dong tickets, voucher offerings worth of VND100,000 and VND50,000 or a free 20kg check-in luggage.
Apart from passenger transport, Vietjet has come up with different measures to increase the ancillary revenue which now accounts for nearly 50% of the airline's total revenue.
Its cargo services have also turned more diverse in terms of product range which was developed closely based on the sentiment of the logistics market in order to meet the mounting cargo delivery demand. In Q1/2021, Swift247 Joint Stock Company, which has 67% of shares owned by Vietjet, has launched a new online air cargo services named SWIFT Mega to deliver heavy freight on Vietjet's extensive flight network. In total, Vietjet has transported 18,000 tons of freight in the first quarter of 2021.
The airline has won the "Belly carrier of the year" and the "Low-cost carrier of the year" awards by cargo magazine Payload Asia in late January this year.
Paying an extra attention to the safety and health of the passengers and the flight crew, Vietjet has been strictly following the COVID-19 prevention measures of the World Health Organization (WHO), the International Air Transport Association (IATA), aviation authorities and health agencies to help passengers and flight crew stay safe. Vietjet was hailed as one of top 10 safest and best low-cost airlines in the world in 2020 by AirlineRatings. It also received the highest safety ranking of 7 stars regarding COVID-19 prevention measures implemented by airlines.
In the coming months, Vietjet is focusing on digital transformation to maximize its capabilities and operating effectiveness. It is also pushing ahead negotiations with services suppliers for appropriate discounts while proactively looking for alternative sources of revenue like air cargo and extended aviation services. The airline plans to carry out financial investments and projects to ensure its business strategy is done in an effective and sustainable manner.
Vietjet has installed the second flight simulator (SIM) at Vietjet Aviation Academy (VJAA) which is expected to start operating in May, 2021. It will fundamentally increase the VJAA's training capabilities, making it one of the most modern and advanced training facilities in the region for aviation manpower in Vietnam and the world.
Vietjet is expected to kick off a series of technical and physical infrastructure projects plus an investment into a technology park. The airline is stepping up preparations to welcome top aviation experts and activities, aiming to make Vietjet one of the top airlines in the world.
As Vietjet projects a recovery in international market in the fourth quarter of 2021, it is now ready for the resumption of regular international flights. Meanwhile, the Vietnamese Government is extending its tax and fee reliefs while considering possible financial assistance and loan interest deduction for the airlines. Vietjet hence strongly believes that the airline and the aviation industry will further develop and contribute to the economic recovery post-pandemic.