The Ho Chi Minh City Stock Exchange (HoSE) has warned national flag carrier Vietnam Airlines of the brink of delisting if it continues reporting losses.
HoSE recently sent a notice to the national flag carrier, whose stock code is HVN, about the delisting risk.
According to the Law on Securities, shares of a public company may be delisted if the firm has loss-making operations for three consecutive years or the accumulated losses exceed the charter capital.
Vietnam Airlines risks delisting after suffering losses worth nearly VND11 trillion (US$467.5 million) and VND13 trillion ($552.6 million) in 2020 and 2021, respectively.
The reviewed semi-annual consolidated financial statement of 2022 also recorded a loss of more than VND5 trillion ($212.5 million).
By the end of this year’s second quarter, the airline had had an accumulative loss of approximately VND29 trillion ($1.2 billion), as well as negative equity of nearly VND4.9 trillion ($208.2 million).
It will be delisted if the audited consolidated financial statement for 2022 continues to show losses and/or negative equity, HoSE warned.
At this year’s general meeting, Vietnam Airlines set a target revenue of more than VND45.25 trillion ($1.9 billion), about 2.3 times higher than the same period last year.
However, the company also expects a deficit of over VND9.33 trillion ($396.6 million) in 2022.
Audit firm Deloitte previously commented that the carrier’s future operations will largely depend on financial support from the Vietnamese government and the extension of loan payments from commercial banks and credit institutions.
In order to deal with existing difficulties, Vietnam Airlines has come up with a restructuring plan for the 2021-25 period.
The national carrier said it would focus on controlling the accumulated loss, restructuring assets and investment portfolios, and preparing for share issuance to raise its equity.