X-Stock | HVN Non-rating: Business results are projected to see little improvement due to elevated oil prices.

EARNINGS UPDATE

2Q2026 Financial Results: HVN posted net revenue of VND 38,303 bn (+37% YoY) and NPAT-MI of -VND 792 bn.

Net revenue growth was primarily driven by:

• Air transport revenue reaching VND 26,865 bn (+20% YoY), benefiting directly from a robust +15% YoY surge in international tourist arrivals to Vietnam in 1H2026.
• Merchandise sales revenue reaching VND 9,437 bn (+150% YoY), fueled by an aggressive push in ancillary sales and inflight services targeting international passengers.
• However, the carrier remained in the red as gross profit margin contracted sharply by 13 percentage points YoY to 4.2%, weighed down by escalating geopolitical tensions in the Middle East that drove oil prices sharply higher (estimated average increase of +61% YoY).

BSC’s view: Overall, core operations remain heavily vulnerable to oil price volatility, particularly with tensions in the Middle East resurging. That said, HVN's performance should see partial relief from the continued momentum in tourist arrivals and sustained high airfares.

INVESTMENT OUTLOOK UPDATE

BSC currently maintains a NOT RATED stance on HVN. We recommend closely tracking the following key catalysts and risks:

• Near-term earnings are unlikely to stage a meaningful recovery: Jet A-1 fuel prices reached USD 171/bbl in September 2026 (+17% MoM, +70% YoY), sharply outpacing the 2Q2026 average (USD 160/bbl, a level at which HVN posted net losses). Furthermore, management indicated that operations break even/turn profitable only when jet fuel drops below USD 135/bbl.
• Re-rating potential upon oil price correction: Should Jet A-1 retreat below USD 135/bbl as Middle East tensions subside, we would reconsider initiating coverage/recommendation on HVN—particularly given the stock's 30% discount from its 2026 peak. The counter is currently trading at a trailing EV/EBITDA of 5.5x, well below its pre-COVID historical average of 7.0x–8.0x during normalized operations.