Bamboo aircraft on the ground at the Vân Đồn International Airport in Quảng Ninh Province. — VNA/VNS Photo
Bamboo Airways is seeking additional capital of around VNĐ1.69 trillion (US$66.8 million) in the final months of 2024 to ensure its operational requirements, while also announcing the clearance of aircraft leasing debts.
Bamboo Airways disclosed the details during its annual shareholders' meeting in HCM City on July 17.
Phan Đình Tuệ, the Chairman of Bamboo Airways' Board of Directors, revealed that the airline's aircraft fleet has undergone a 19 per cent reduction compared to 2022, as part of a fleet restructuring initiative.
Net revenue from sales and services has increased 6 per cent year-on-year, amounting to over VNĐ12.3 trillion. The seat occupancy rate has risen to 87 per cent, the average passenger revenue has grown by 14 per cent, and the ancillary revenue has surged by 25 per cent.
In 2023, Bamboo Airways achieved a positive profit after tax of VNĐ236.8 billion, a significant improvement compared to the nearly negative VNĐ20 trillion recorded in 2022.
According to Bamboo Airways, the company successfully reduced its total debt obligations by approximately VNĐ2 trillion in 2023 and no longer has any aircraft leasing debts.
Lương Hoài Nam, Bamboo Airways' CEO, acknowledged the difficulties in airline restructuring but expressed the company's goal to make 2024 the final year of operating at a loss.
From 2025 onwards, Bamboo Airways plans to achieve capital neutrality and move towards profitability in the subsequent years. The company aims to have its shares traded on the stock exchange within a three-year timeframe.
Under the plan, Bamboo Airways is projected to generate a total revenue of nearly VNĐ4.9 trillion this year, significantly reducing its loss to approximately VNĐ1.4 trillion.
Despite the ambitious goals ahead, it emphasises the need for additional capital to meet its operational requirements. The airline states that it still requires approximately VNĐ1.69 trillion of supplementary funding for the last few months of 2024.
This capital will be sourced through various capital mobilisation methods from domestic and international credit institutions and investors, in accordance with legal regulations.
The aircraft fleet is set to expand, with nine Airbus planes initially and a planned increase to 12 by the year's end. If market conditions permit, Bamboo Airways envisions expanding the fleet to 18 aircraft by the end of 2025.
To optimise operational expenses, Bamboo Airways has made changes to its ground service provider, transitioning from SAGS HGS to Pacific Airlines.
By implementing self-handling, the company has achieved a 20 per cent reduction in ground service costs per flight.
Additionally, successful negotiations have led to the planned migration of their Passenger Service System (PSS) from Amadeus to Navitaire, set to be implemented in April 2025.
This transition is expected to result in a minimum saving of $20 million over the next five years for the company. — VNS