Fleet expansion helps push Vietjet to USD60 million profit in Q1 of 2018

Following the arrival of its first new Airbus A321neo in January, VietJet has released its first financial statement of 2018, which displays a massive year-on-year increase of 146%, resulting in a net profit of USD 60 milion.

Fleet expansion was at the heart of this incredible growth with new aircraft — complemented by new international routes to destinations such as India Japan, Australia, and South Korea – raising transport revenue up to VND6,035 billion (USD265 million), a growth of 52% compared with the first quarter in 2017, 10% higher than VietJet’s target.

VietJet currently maintains a fleet of 55 planes comprised of 24 Airbus A320-200s; 30 Airbus A321-200s, with seven on order and one Airbus A321neo, with 72 on order.

The airline also has 100 Boeing 737 MAX 200 (worth USD 11.3 billion), the biggest order of its kind in the Vietnam’s history, slated to arrive between 2019 and 2023.

Discussing the importance of VietJet’s relationship with Airbus earlier this year, Nguyen Thi Phuong Thao (above), VietJet president and CEO said: “The A320 family aircraft has greatly contributed to VietJet’s impressive operating performance with the airline’s technical reliability rate standing at 99.6 percent in 2017.

“The aircraft has also helped us maintain some of the lowest operating costs in the airline world.

“The upgraded A321neo deal emphasises VietJet’s ceaseless efforts to modernize our fleet. We believe that the technical reliability rate and other operation and safety indexes will continue to increase in order to bring maximum comfort, joy and safety to our passengers.”

VietJet’s core business profit increased to nearly VND737 billion (USD32 million), a 74% jump on 2017’s figure, while ancillary revenue leapt 64 %to VND1, 825 billion (USD80 million).

The eye-catching revenue growth added to the company’s gross profit of VND1, 810 billion (USD79 million), an uptick of 135% year-on-year.  At the same time, sales and management costs grew at a slower rate against revenue growth. This all adds up to a net profit of VND1, 366 billion (USD60 million), a 263% increase on last year.

The current positive state of Vietnam’s economy, coupled with the government’s continued promotion of the country’s tourism sector, alongside VietJet’s well thought out expansion, means the airline is in a great position to achieve its vision of being a major multi-national player competing on a global scale.