According to a report from the Ministry of Finance, at the end of April this year, Bamboo Airways recorded a loss of US$14.2 million.
Despite this financial loss, which occured only three months after the new air carrier took off in January, Bamboo Airways has plans to expand its fleet to 22 aircraft in 2019 and 30 by 2023. Reviewing Bamboo Airways' financial situation, the ministry ordered that the approval of the fleet expansion should be reexamined, Tuoi Tre reported on August 14.
During a meeting with shareholders in June, Bamboo Airways Chairman Trinh Van Quyet explained that the loss was due to the fact that the airline is currently paying salaries for a team big enough to operate 30 aircraft, yet only 10 aircraft are in fact allowed to operate.
A later report by VnExpress on the same day said that the airline has received permission to expand its fleet to 30 aircraft. The permission was signed by Deputy Prime Minister Trinh Dinh Dung, allowing Bamboo Airways to operate narrow-body and wide-body jets, including the Airbus A320, Airbus A350 and Boeing B787.
The permission comes with a restriction on the company's capital increase, however. The airline earlier proposed to increase its capital from VND1.3 trillion (US$56 million) to VND8.3 trillion (US$357.9 million), but was only allowed to increase the figure to VND5.7 trillion (US$245.8 million). The government explained that it has to establish this limit due to the airline's aforementioned business results.
Bamboo Airways has also recently announced its financial results for 2019’s second quarter, which shows that its ledgers have improved, with the company’s revenue increasing three-fold compared to the first three months of operation.
[Photo via AIN Online]
