This is the third year in a row that the Vietnam Railways Corporation has operated below cost. This year, this company has reduced its loss significantly compared to loss of 100 billion VND in the same period.
The financial statements of Vietnam Railways Corporation (parent company) recorded revenue in the first 6 months of the year reaching nearly 1,050 billion VND, a growth of 36% over the same period but not reaching the same period in 2019 – the time before the epidemic. This figure also reached just over 24% of the year’s revenue plan.
Administrative expenses, interest and dividends all improved significantly over the same period, but the company still lost about 30 billion VND after tax. In the same period, this figure reached 100 billion VND.
The loss was not unexpected by the management of the Vietnam Railways Corporation. According to the plan announced at the beginning of the year, the company targets total revenue of 1,622 billion VND and a loss after tax of 570 billion VND. This is the third year in a row that the company’s business has been dismal, mainly due to the sharp drop in passenger volume due to the epidemic. In 2020 and 2021, the company has a loss after tax of 1,327 billion VND and 565 billion VND, respectively.
However, this was the expectation of the leadership of the Vietnam Railways Corporation. Accordingly, the main targets set by the parent company are total revenue of 4,364 billion VND; profit before tax loss 550 billion VND; taxes and other payables to the State 115 billion VND; having no overdue debt and having a debt solvency ratio greater than 1; investment capital plan is less than or equal to 35 billion VND.
According to a representative of the Railway Corporation, the high fuel price causes many difficulties for railway transport enterprises in maintaining competitive freight rates with other means of transport and balancing production and business costs. The throughput capacity of the Unified route does not meet the requirements of transport.
The management said that this year will gradually shift the focus from passenger transport to freight transport, in which international intermodal ships will be promoted.
As of the end of June, the Vietnam Railways Corporation had assets of more than 15,000 billion VND, an increase of 200 billion VND compared to the beginning of the year. The company is owed nearly 2,230 billion VND and the undistributed loss is more than 1,850 billion VND.
@ Zing News