The “big man” of tourism lost hundreds of billions but still optimistic

In early June, Saigontourist and Vietravel started bringing large groups of tourists to join domestic tours. Summer is the peak season for tourism. After losing everything last summer because of Covid-19, the “big boys” in the tourism industry are really making a comeback.

Loss of hundreds of billion dong

The consolidated financial statements for the first quarter of 2022 of Vietnam Tourism and Transport Marketing Joint Stock Company (Vietravel) show revenue from ticket sales, sales of goods, and revenue from providing services. almost dropped without brakes compared to the same period last year. Vietravel’s total revenue in the first quarter of 2022 decreased by 22% compared to the same period in 2021, to 216 billion dong.

While saving a lot of costs, the loss at the associate company (including a loss of 60 billion VND at Vietravel Airlines), caused Vietravel to report a loss of 108 billion VND in the first quarter of 2022.

The recent consolidated financial statements released by the Saigon Tourism Corporation (Saigontourist) also revealed a loss of up to hundreds of billions of dong in the fiscal year 2021.

In 2021, Saigontourist’s revenue is less than half of 2020, reaching just over 1,140 billion VND. This number is 5.6 times lower than the average in the 4 years before the epidemic.

Saigontourist’s gross profit was negative for the first time when COGS exceeded the revenue threshold. Saigontourist also suffered a loss of more than 160 billion dong from 19 joint ventures and associates, doubling over the same period. This business also lost a large part of financial income and other income.

2021 is not a smooth business year for Saigontourist, recording a loss after tax of about 534 billion dong.

The management of Saigontourist assessed that the revenue and profit targets of 2021 were all reduced because the company’s main business activities were heavily affected by Covid-19, dividends from capital-contributing units. decreased sharply because in 2020, joint ventures and associates did not have profits to share, even deposit interest decreased because banks reduced deposit interest rates.

In 2022, the tourism industry will be more optimistic

Although recording a very high loss, lasting through the first quarter of 2022, the “big guys” in the tourism industry all think that the business situation this year will be better, when the demand for travel increases.

For example, despite a heavy loss of 108 billion VND in the first quarter of the year, the travel segment is one of Vietravel’s brightest points. Vietravel’s travel service revenue in the first three months of the year amounted to nearly 197 billion VND, up 174% over the same period last year. This is the field that brings the highest revenue for Vietravel in the first quarter of 2022, accounting for 91% of the total revenue of the business.

In fact, travel companies have recorded better results from the 2022 Lunar New Year period when the Covid-19 epidemic situation in Vietnam is under control. At that time, the people’s travel demand began to increase again. Especially from the end of March, Vietnam officially opened to welcome international visitors. The number of international visitors to Vietnam is increasing day by day.

Commenting on the business situation this year, Mr. Pham Huy Binh – Chairman of Saigontourist, said that the recovery trend has appeared in the last months of 2021 and is forecasted to grow better this year.

Saigontourist aims to welcome 988,000 visitors, an increase of 163% compared to 2021. The goal of total direct business revenue in 2022 is VND 2,556 billion.

According to Mr. Binh, one of the important tasks of Saigontourist this year is to build a synchronous and unique ecosystem of products and services of the system through its strengths in accommodation, travel and tourism businesses. food, entertainment, conferences and seminars…

For businesses that are less “bulky”, right in the first quarter of 2022, revenue and profit have started to skyrocket again. In the first quarter of 2022, Dam Sen Water Park Joint Stock Company (stock code: CVN) recorded a revenue of VND 30 billion, 3 times higher than that of the first quarter of 2021. Profit after tax reached more than 8 billion, while in the same period only a few hundred million.

Vietnam’s tourism industry in 2022 aims to welcome 65 million tourists, including 5 million international visitors and 60 million domestic tourists. Total revenue from tourism is estimated at 400,000 billion VND.

According to experts of SSI Research, open tourism strongly supports the general economic recovery process as well as the profit growth of related businesses.

Accordingly, open tourism will promote revenue growth and improve profits for businesses operating in the fields of tourism, travel, tourist accommodation, and tourist transport. However, it will take time to reflect on the business results of the business.