National carrier Vietnam Airlines remained in the red in the first quarter of this year, with losses of nearly US$113 million, despite its revenue rising to a two-year high.

The airline posted a loss of VND2.621 trillion ($112.9 million) over the first three months of 2022, according to its Q1 consolidated financial statements issued on Friday.

The loss was recorded even though the flag carrier logged revenue of more than VND11.6 trillion ($500 million) in the period, up 55 percent year on year, the highest performance since the second quarter of 2020, when COVID-19 began to severely affect Vietnam’s aviation industry.

The impressive revenue failed to cover the total cost that was higher than expected, leading to the firm’s ninth consecutive quarterly loss, the carrier said.

Vietnam Airlines’ fuel expense in the quarter was VND465 billion ($20 million) more than projected given rising world oil prices, VnExpress cited the company as saying.

The Q1 result has brought the airline’s accumulated deficit to about VND24.5 trillion ($1.05 billion), some VND2.16 trillion ($93 million) higher than its charter capital.

The carrier said its operating results mirrored the prolonged serious impact of the COVID-19 pandemic on the aviation industry despite the relatively quick recovery of the domestic market.

Meanwhile, the international airline market was almost frozen in the first quarter of 2022, while the ongoing Russia - Ukraine armed conflict, which broke out on February 24, has driven up fuel prices sharply, Vietnam Airlines explained.

With heavy losses, the airline, with its securities code HVN, is facing a risk of being delisted from the Ho Chi Minh City Stock Exchange according to current regulations.

In its recent statement to the State Securities Commission, the carrier said that it has adopted drastic solutions for minimizing the pandemic impacts, along with taking advantage of support from its partners, to maintain and develop operations.

“Business activities have gradually stabilized and we are making necessary steps for our recovery and development phase in the coming time,” the airline stated.

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