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Hanoi Metro’s profits surge sixfold in 2023 thanks to subsidies, deposit interest

Hanoi Metro’s profits surge sixfold in 2023 thanks to subsidies, deposit interest

Wednesday, May 15, 2024, 13:20 GMT+7
Hanoi Metro’s profits surge sixfold in 2023 thanks to subsidies, deposit interest
A train arrives at a station on the Cat Linh-Ha Dong metro line in Hanoi. Photo: Pham Tuan / Tuoi Tre

Hanoi Metro, which operates the Cat Linh-Ha Dong metro line, announced a net profit of VND13.1 billion (US$514,583) for 2023, nearly six times higher than 2022, largely driven by significant subsidies and interest income from bank deposits. 

According to the 2023 audited financial report recently released by Hanoi Metro, the net revenue for the year amounted to VND515.26 billion ($20.2 million), marking a nearly-seven-percent increase from 2022. 

However, revenue from ticket sales only accounted for VND74 billion ($2.9 million), with one-way trip prices ranging from VND8,000 ($0.3) to VND15,000 ($0.6) per ticket, depending on the travel distance.

The remaining VND441 billion ($17.3 million) was sourced from subsidies. 

The price subsidies from Hanoi’s coffers offset the 8.6-percent increase in the cost of goods sold, totaling VND507 billion ($19.9 million), resulting in a gross profit of VND7.8 billion ($306,435). 

By the end of 2023, the company had 745 employees, 78 more than the previous year, mainly operating the Cat Linh-Ha Dong metro line, which spans 13km with 12 stations from Cat Linh Station in Ba Dinh District to Yen Nghia Station in Ha Dong District. 

This substantial employment resulted in staff costs of VND11.77 billion ($459,653), up nearly 23 percent from the previous year.

Labor costs included in the cost of goods sold totaled VND 99.1 billion ($3.9 million), reflecting an approximate 10-percent increase.

Despite those increased costs, Hanoi Metro earned an interest income of VND26.5 billion ($1 million) from bank deposits surpassing VND685 billion ($26.9 million). 

With no financial costs incurred during the year, the company’s after-tax profit exceeded VND13.1 billion, nearly six times higher than 2022, logging the second consecutive year of positive profits after seven years of losses. 

For 2024, Hanoi Metro plans to transport nearly 11 million passengers, aiming for total revenue of over VND529 billion ($20.8 million) and an after-tax profit of VND13.4 billion ($526,440). 

In addition to the Cat Linh-Ha Dong metro route, the first of its kind in Hanoi, the company plans to undertake necessary steps to put the Nhon-Hanoi Station metro line into operation in July, including organizing personnel recruitment and training, as well as other related activities. 

The Nhon-Hanoi Station metro line, scheduled to be the capital city’s second metro service, will run 12.5 kilometers from Nhon in Nam Tu Liem District to the Hanoi Railway Station in the downtown area, with 8.5 kilometers on elevated tracks, four kilometers underground, and one depot.

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Bao Anh - Binh Khanh / Tuoi Tre News

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