ACV Slashes Workforce by Over 2,300 in Six Months Amid Restructuring and Long Thanh Airport Project

Vietnam Airports Corporation (ACV) has reduced its workforce by over 2,300 employees, a reduction of more than 20%, in the first half of the year, bringing its staff numbers down to around 8,500. This strategic move aims to enhance operational efficiency while simultaneously advancing the construction of the national key project, Long Thanh International Airport. According to its latest financial report, ACV had 8,474 employees at the end of the second quarter. The company streamlined its operations by cutting nearly 1,200 employees in the first quarter and an additional 1,160 in the subsequent three months. This significant workforce reduction has led to a substantial decrease in employee costs and benefits, down to VND 1.9 trillion (approximately $75 million), about VND 300 billion ($12 million) lower than the same period last year. The downsizing follows ACV's restructuring of its management apparatus. The company's annual report in April indicated a reduction in departments reporting directly to the Board of Directors and the General Director from 17 to 12. ACV currently operates 25 airport branches, one subsidiary, and six joint-venture and affiliated units. ACV's leadership has prioritized streamlining and optimizing its organizational structure as a key corporate governance objective for the year. Furthermore, the company plans to strictly manage recruitment, restructure its human resources, and develop expert teams in critical areas. It also intends to establish competitive salary and welfare mechanisms to attract and retain high-quality personnel. ACV is the investor for the Long Thanh International Airport, a national pivotal project with an area of approximately 5,000 hectares and a total investment of nearly VND 337 trillion (approximately $13.3 billion). The company has recruited a total of 250 personnel for airport operations. While the airport is slated for trial operations in September and commercial flights in December, it faces challenges in securing construction labor. A report from mid-June indicated that the construction site maintains an average of 7,170 direct workers, but still requires an additional 1,500-2,000 workers, primarily for the passenger terminal and internal road packages. ACV aims to increase its revenue by 2% year-on-year to VND 21.141 trillion (approximately $835 million) this year. However, its projected profit before tax is expected to significantly decrease to VND 7.011 trillion ($277 million), down from VND 15.203 trillion ($600 million) last year, marking the lowest profit since 2021. Management attributes this profit decline to the company entering a peak investment phase with the completion of several large projects, leading to increased depreciation, operating, maintenance, and interest expenses. Additionally, accumulated funds will be channeled into national key projects, reducing expected interest income from bank deposits. In the first six months of the year, ACV generated over VND 13.2 trillion ($520 million) in revenue and VND 6.7 trillion ($264 million) in profit before tax, fulfilling 62% and 96% of its annual targets, respectively. The company currently holds total assets of nearly VND 94 trillion ($3.7 billion) and liabilities of approximately VND 20 trillion ($790 million). Construction costs for Long Thanh Airport have reached nearly VND 39.5 trillion ($1.56 billion), an increase of over VND 5 trillion ($197 million) since the beginning of the year. Source: VnExpress