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Vietnam Airlines' HVN shares are currently under control and restricted trading (only traded in the afternoon session) by HoSE and are at risk of forced delisting according to regulations.
In the context of the stock market being under strong adjustment pressure, Vietnam Airlines shares (code HVN) suddenly soared to a 19-month peak. From the beginning of 2024 until now, HVN market price has increased more than 30% and currently stands at 16,000 VND/share. The corresponding market capitalization reached more than 35,400 billion VND (~1.4 billion USD).
HVN shares are flying high in the context that Vietnam Airlines has just lost money for the 4th consecutive year. Specifically, according to the 2023 audited consolidated financial statements, this airline recorded revenue of 92,231 billion VND, an increase of 30% compared to 2022. After deducting expenses, Vietnam Airlines lost 5,631 billion VND, better than with losses of more than ten trillion per year in the period 2020-2022.
According to the explanation, Vietnam Airlines' losses narrowed last year mainly due to reducing losses of the Parent Company and Pacific Airlines. Besides, subsidiaries such as: VAECO (Aircraft Engineering Company Limited), VACS (Vietnam Catering Company Limited), NCS (Noi Bai Catering Joint Stock Company).... all increased profits compared to with the same period last year.
The fourth consecutive year of losses pushed Vietnam Airlines' accumulated losses up to VND 41,000 billion, far exceeding its charter capital. This puts the airline in a negative equity position of more than 17,000 billion VND. In addition, Vietnam Airlines is also experiencing financial imbalance when short-term debt exceeds short-term assets by 46,287 billion VND.
According to the audit, the above issues show the existence of material uncertainties that may lead to doubts about Vietnam Airlines' ability to continue operating. The auditor believes that the ability of the Corporation and its subsidiaries to continue operating will depend mainly on the ability to recover production and business activities after COVID-19 and the extension of loan payments.
from commercial banks, credit institutions and payables to suppliers and lessors, as well as the possibility of success of the restructuring project currently being considered and approved by competent authorities. Browser.
Risk of delisting and hope for "Special Case"
HVN shares are currently under control and restricted trading (only traded in the afternoon session) by HoSE and are at risk of forced delisting. Because, Vietnam Airlines violated all 3 conditions including production and business losses for 3 consecutive years, total accumulated losses exceeding the actual contributed charter capital, negative equity in the audited financial statements of the last year. before the time of review.
Regarding the roadmap to overcome the causes leading to stocks falling under control, Vietnam Airlines said it has completed the Corporation restructuring project for the period 2021-2025 and has reported to shareholders and competent authorities for review. review for approval.
Accordingly, the Corporation will synchronously implement solutions to overcome the situation of consolidated losses and negative consolidated equity such as: synchronously implementing solutions to enhance adaptation and improve operating results. business activities; Restructure assets and financial investment portfolio to increase income and cash flow.
As for the risk of forced delisting, Vietnam Airlines may have to rely on "Special Cases". According to the draft amendment and supplement to the Securities Law consulted by the State Securities Commission at the beginning of the year, Article 120 on mandatory delisting of shares will be supplemented with Clause 7 with the content "Special cases".
listing needs to be maintained as the Government considers and decides." Many opinions believe that this could be a provision that "paves the way" for Vietnam Airlines' HVN shares to continue to be listed on HoSE.
In another development, Vietnam Airlines has just announced the Board of Directors resolution to extend the time to organize the 2024 Annual General Meeting of Shareholders after April 30, 2024 and no later than June 30, 2024. The last registration date to attend the Congress is expected to be May 23 and the time to hold the Congress is expected to be June 21, 2024.
