AIR - Air NZ.

[workingdad]

Looking at fundamentals (and ignoring the cyclical nature of the industry) - yes some analysts see them still as undervalued; On the other hand - they often do (and sometimes they are right and sometimes they are not).

However - looking at the graph ... I'd call that ugly. Sure - any down trend has to stop at some stage, but why do you think this is now?
8096

Not even the indicators appear to move towards "oversold". Why do you think the trend should turn now?

8097

And yes - high divvies are nice, but if they are not sustainable, than they are frequently just the last hurrah of a board trying to keep the SP up - no matter what the cost. Sure - at current the forward PE of AIR looks really nice (3.9), but if you look at the long term PE (14.5 - not that flash) and consider that they will have as many years with worse PE than average than better - are you sure that next years divvies will still justify the current share price?

Average the PE out over the next say 3-4 years and its still good and looking further than that into the future is a guessing game. For me it seems undervalued and perhaps continuing to head down again today if it has the somewhat recurrent afternoon drop, I came in halfway on the bounce to 2.31 and then had tight stop loss which was activated mid 2.25s so got a bit of some of the losses back over the last 6 weeks or so from hanging on too long and think there is some short term gains to be made but you are right, its under a lot of pressure.

I don't think with any degree of certainty the trend should turn now but I do think AIR is worth more than its current trading range, there are headwinds but there is also the potential for good news with a sale of VAH, growing tourism offsetting some of the competition and good fleet age looking ahead keeping operating costs in check.

I have been hesitant to jump back in for good reason but looking at it closely in an attempt to catch an announcement on VAH and potential rebound.

[Nasi Goreng]

On one side of the scales you have growing market, good reputation, strong and profitable domestic business, profitable international business, good fleet.

On the other side, you have an increase in competition, declining profits, history of being cyclical, the dog that is called VAH.

[workingdad]

[QUOTE=

Yes yes yes, I agree its undervalued but this NTA, is it before the write down they will need to do for VAH, and before the $50M they will pay to regulators. They have considerable debt too which no one seems to talk about, I'm going from memory here but isn't it around $5B? If it was me, I would be paying that down with any cash that I got from VAH sale.[/QUOTE]

I think if they did that one could predict the share price taking a hammering, they haven't hidden the indication of a special divvy if sold.....

[Snow Leopard]

NTA for AIR at 30-Jun-15 (FY15) was about $1.66

NTA for AIR at 31-Dec-15 (HY16) was about $1.74

NTA for AIR at 30-Jun-16 (FY16) is expected to be about $1.93

NTA = All Assets - Intangible Assets* - All Liabilities.

Best Wishes
Paper Tiger

[sharp]

Although many have you have been disappointed with the sale of AIR by management, I think people forget that management isn't necessarily selling because they see headwinds. Management often have limited window of opportunity to sell and I think you will need to remember that these people have mortgages and Mangawhai baches to build.

Resulting from this is the frailing confidence in Luxon and AIR to sell or somehow deal with VAH despite his confidence in dealing with VAH prior to 30 June. Ignoring all the speculation and theories focus I for one will rely on Luxon's words and his expectations:

"Nothing has changed for us," Mr Luxon told Fairfax Media on the sidelines of the International Air Transport Association annual meeting in Dublin.
"We are right in the middle of the process and obviously have got to follow it through to its logical conclusion. I appreciate there is lots of speculation but there is a big process that is going to play out and there are going to be multiple phases to it and we are just working our way through that really."

[workingdad]

Although many have you have been disappointed with the sale of AIR by management, I think people forget that management isn't necessarily selling because they see headwinds. Management often have limited window of opportunity to sell and I think you will need to remember that these people have mortgages and Mangawhai baches to build.

Resulting from this is the frailing confidence in Luxon and AIR to sell or somehow deal with VAH despite his confidence in dealing with VAH prior to 30 June. Ignoring all the speculation and theories focus I for one will rely on Luxon's words and his expectations:

"Nothing has changed for us," Mr Luxon told Fairfax Media on the sidelines of the International Air Transport Association annual meeting in Dublin.
"We are right in the middle of the process and obviously have got to follow it through to its logical conclusion. I appreciate there is lots of speculation but there is a big process that is going to play out and there are going to be multiple phases to it and we are just working our way through that really."



When this came out I was interested in the multiple phases aspect. I hope its a positive one and SP seems to be holding today.

[mikeybycrikey]

Although many have you have been disappointed with the sale of AIR by management, I think people forget that management isn't necessarily selling because they see headwinds. Management often have limited window of opportunity to sell and I think you will need to remember that these people have mortgages and Mangawhai baches to build.

Yes, I would have to agree with this. According to teir policy, they can't sell between the end of the reporting period and the interim/final report being released. So that means January, February, July and August are out.

I expect they won't sell too close to the start or end of that close-out period, which probably also cuts out December, March, June and September.

Is it really a surprise that insider sales at AIR only seem to happen in April and October? People have to build baches some time, you know!

[sharp]

When this came out I was interested in the multiple phases aspect. I hope its a positive one and SP seems to be holding today.

I haven't encountered an M&A deal which has ever been straight forward and more involving then initially anticipated .

I would not be surprised if this is not a straight sale of VAH involving a number of ancillary arrangements.

[Mista_Trix]

Average the PE out over the next say 3-4 years and its still good and looking further than that into the future is a guessing game. For me it seems undervalued and perhaps continuing to head down again today if it has the somewhat recurrent afternoon drop, I came in halfway on the bounce to 2.31 and then had tight stop loss which was activated mid 2.25s so got a bit of some of the losses back over the last 6 weeks or so from hanging on too long and think there is some short term gains to be made but you are right, its under a lot of pressure.

I don't think with any degree of certainty the trend should turn now but I do think AIR is worth more than its current trading range, there are headwinds but there is also the potential for good news with a sale of VAH,

I have been hesitant to jump back in for good reason but looking at it closely in an attempt to catch an announcement on VAH and potential rebound.

Can I make a small observation about the way you (and others) are talking about, and investing in AIR.
You look as though you are treating it like a growth or tech stock, and looking past the old maiden that she is.

Its a cyclical stock, in a low margin industry.
Its a great div play, if it can keep paying. But in terms of the way its talked about versus what it is, most people seem to be misinterpreting the way it markets itself for the realities kind of company it is.

Its not some snappy new talking new walking kinda thang that will revolutionalise its industry. Its a same old, same old, do what the others are doing (admittedly with great marketing) gunna make a slow buck.

Dont get me wrong, the company is great, but it is what it is.

[sharp]

Can I make a small observation about the way you (and others) are talking about, and investing in AIR.
You look as though you are treating it like a growth or tech stock, and looking past the old maiden that she is.

Its a cyclical stock, in a low margin industry.
Its a great div play, if it can keep paying. But in terms of the way its talked about versus what it is, most people seem to be misinterpreting the way it markets itself for the realities kind of company it is.

Its not some snappy new talking new walking kinda thang that will revolutionalise its industry. Its a same old, same old, do what the others are doing (admittedly with great marketing) gunna make a slow buck.

Dont get me wrong, the company is great, but it is what it is.

Don't get me wrong, but have you considered new factors at play such as the ever increasing Chinese middle class with an appetite for travel?

Is it still the same old same old market and industry?

[Beagle]

http://www.4-traders.com/AIR-NEW-ZEALAND-LIMITED-6491407/financials/
Consensus NTA as at 30 June 2016 $2.04 and as at 30 June 2017 $2.29, includes $112m of intangible assets listed in the balance sheet as at 31 December 2015, 9.9. cps for all the I.P. of AIR.

NTA metric comparison looks compelling compared to its peers.

Some people will want to buy at a discount to NTA taking into account recent issues and the potential loss from a possible VAH sale and quite frankly I can't say I blame them but that doesn't make a case of itself for me to sell this close to NTA so I for one will continue to hold.

[BlackPeter]

Don't get me wrong, but have you considered new factors at play such as the ever increasing Chinese middle class with an appetite for travel?

Is it still the same old same old market and industry?

Chinese middle class will travel as long as fuel is cheap and the economy is booming - maybe a new client group, but same old cyclical industry. The other thing to consider is - nearly anybody can open and run an air line these days - very small moat. Chinese are good in running airlines (e.g. Cathy Pacific is one of the top air lines world wide, but there are many others as well) and no doubt they all will keep improving.

Not sure I see the next handful of years as home run for Air New Zealand.

[couta1]

Added a few more the other day, average price now around $2.56 so that will do for now, actually my A2 shares are down more than Air as a percentage. A couple of superb rollercoasters to own if I may say so myself. PS-Survived the Xrocoaster so well qualified to ride this baby.:cool:

[sharp]

Chinese middle class will travel as long as fuel is cheap and the economy is booming - maybe a new client group, but same old cyclical industry. The other thing to consider is - nearly anybody can open and run an air line these days - very small moat. Chinese are good in running airlines (e.g. Cathy Pacific is one of the top air lines world wide, but there are many others as well) and no doubt they all will keep improving.

Not sure I see the next handful of years as home run for Air New Zealand.

I am not on the same page as you on your opinion that somehow Chinese middle class travel is dependent on cheap fuel.

Cathay Pacific is hardly a "Chinese" airline so to speak - its biggest shareholder is the Swire Group and you will be offending many people by generalising Cathay as 'Chinese' and it is Hong Kong based airline.

[Snow Leopard]

http://www.4-traders.com/AIR-NEW-ZEALAND-LIMITED-6491407/financials/
Consensus NTA as at 30 June 2016 $2.04 and as at 30 June 2017 $2.29, includes $112m of intangible assets listed in the balance sheet as at 31 December 2015, 9.9. cps for all the I.P. of AIR.

NTA metric comparison looks compelling compared to its peers.

Some people will want to buy at a discount to NTA taking into account recent issues and the potential loss from a possible VAH sale and quite frankly I can't say I blame them but that doesn't make a case of itself for me to sell this close to NTA so I for one will continue to hold.

Actually you are quoting the Book Value (or Net Asset Value) per share.

As any accountant should tell you this is different from

the Net Tangible Asset (NTA to his friends) per share which specifically excludes Intangible Assets.
In the case of Air New Zealand Intangibles (as they are sometimes called) is purely for certain items of [customised] software.
There is no other Intellectual Property on the books.

Whilst there is lot more to the value of an airline than a simple NTA multiplier and I personally consider current value to be well in excess of the current price I stick with my belief that owning airline shares is only for your multi-millionaire friends who have nothing better to do with their money.

Best Wishes
Paper Tiger

[Raz]

Don't get me wrong, but have you considered new factors at play such as the ever increasing Chinese middle class with an appetite for travel?

Is it still the same old same old market and industry?

AIR will pick up the Chinese on the domestic network that is certain however the international market share on the Chinese coming here may well go against AIR given HAN recent strategic play into VAH. I actually think the domestic is often overstated for Chinese tourists as it is clear the main route is progressively direct into Auckland and then Queenstown.

Simply put the HAN play into VAH could well change AIRs growth potential.

[bull....]

looks like new lows soon I reckon higher oil prices even higher nzd after todays rbnz announcement

[stoploss]

looks like new lows soon I reckon higher oil prices even higher nzd after todays rbnz announcement
Hi Bull , I think Air.nz have maximum fuel hedges in place .Also higher Kiwi lowers the cost of that product in USD , so I don't understand what you are getting at ?

[dobby41]

Higher fuel makes other less economical than AIR on some competing routes.

[IAK]

AIR will pick up the Chinese on the domestic network that is certain however the international market share on the Chinese coming here may well go against AIR given HAN recent strategic play into VAH. I actually think the domestic is often overstated for Chinese tourists as it is clear the main route is progressively direct into Auckland and then Queenstown.

Simply put the HAN play into VAH could well change AIRs growth potential.

The well established path for Chinese Visitors is Auckland Rotorua Queenstown. http://www.tourismnewzealand.com/news/chinese-new-year-brings-growth-and-change/

[Beagle]

PT you have taken pedantic to all new level's (lows). I made it quite clear in my post what was intangible assets and taking into account AIR's systems and superb marketing abilities, (they have consistently averaged low - mid 80% load factors for several years) $112m, about 9.9 cps for intangible assets given the size of their balance sheet footings is an extremely low figure in my professional opinion. Put more frankly, their balance sheet isn't riddled with creative valuations for intangible assets like a lot of other companies are.
You are right about the fact that I should amend my ignore list, (done). 2 Timothy 2 v 14. You and I. we're done for good. I suggest you follow suit so this forum is more harmonious going forward.

[macduffy]

Please, no ignore lists, anyone. We don't want to hear only one side of a discussion - and besides, the entertainment value of these debates is priceless!

[couta1]

PT you have taken pedantic to all new level's (lows). I made it quite clear in my post what was intangible assets and taking into account AIR's systems and superb marketing abilities, (they have consistently averaged low - mid 80% load factors for several years) $112m, about 9.9 cps for intangible assets given the size of their balance sheet footings is an extremely low figure in my professional opinion. Put more frankly, their balance sheet isn't riddled with creative valuations for intangible assets like a lot of other companies are.
You are right about the fact that I should amend my ignore list, (done). 2 Timothy 2 v 14. You and I. we're done for good. I suggest you follow suit so this forum is more harmonious going forward. Good on ya mate, getting drawn into a childish goading game is a waste of time,keep the Faith.

[sharp]

PT you have taken pedantic to all new level's (lows). I made it quite clear in my post what was intangible assets and taking into account AIR's systems and superb marketing abilities, (they have consistently averaged low - mid 80% load factors for several years) $112m, about 9.9 cps for intangible assets given the size of their balance sheet footings is an extremely low figure in my professional opinion. Put more frankly, their balance sheet isn't riddled with creative valuations for intangible assets like a lot of other companies are.
You are right about the fact that I should amend my ignore list, (done). 2 Timothy 2 v 14. You and I. we're done for good. I suggest you follow suit so this forum is more harmonious going forward.


I agree with Roger's sentiments.

To put into perspective how many other companies are we comparing the SP with NTA (including or excluding intangibles)?

NTA comes into play when the company is about to go under or when it is to be liquidated so that investors have an idea as to how much they will get in a dollar.

The fact that we are comparing a SP that is nearing the AIR's NTA really shows how much AIR is undervalued or perhaps how the SP is influenced by emotions and speculation.

I generally had high regard to the contributors' knowledge on this forum but recent correspondences on this forum show it is quite the contrary.

[sharp]

If one was to speculate.

One would wonder what Branson is doing in Australia.

He happens to be in Queensland, where it so happens the head office of Virgin Australia is based.

Go forth and speculate.

[Biscuit]

2 Timothy 2 v 14. You and I. we're done for good. I suggest you follow suit so this forum is more harmonious going forward.


Hmmm, but didn't Timothy say "24 And the Lord’s servant must not be quarrelsome but must be kind to everyone, able to teach, not resentful. 25 Opponents must be gently instructed, in the hope that God will grant them repentance leading them to a knowledge of the truth..."

Nothing said about blocking them out?

[couta1]

Hmmm, but didn't Timothy say "24 And the Lord’s servant must not be quarrelsome but must be kind to everyone, able to teach, not resentful. 25 Opponents must be gently instructed, in the hope that God will grant them repentance leading them to a knowledge of the truth..."

Nothing said about blocking them out? You forgot to include v23 Again I say, don't get involved in foolish, ignorant arguments that only start fights.

[macduffy]

You forgot to include v23 Again I say, don't get involved in foolish, ignorant arguments that only start fights.

There we are. Something for everyone!

[workingdad]

If one was to speculate.

One would wonder what Branson is doing in Australia.

He happens to be in Queensland, where it so happens the head office of Virgin Australia is based.

Go forth and speculate.

I would be happier to see him in New Zealand

[winner69]

Checking out the Great Barrier Reef for World Ocean Day

Mind u he caught a Virgin worker asleep in the office ' maybe John B

[ohpark0119]

daily graph looks like a sine wave.

[BlackPeter]

I am not on the same page as you on your opinion that somehow Chinese middle class travel is dependent on cheap fuel.


How do they say ... everybody is entitled to their opinion.
Just wait for fuel to go up and lets then continue this discussion ...



Cathay Pacific is hardly a "Chinese" airline so to speak - its biggest shareholder is the Swire Group and you will be offending many people by generalising Cathay as 'Chinese' and it is Hong Kong based airline.

I think you misunderstood - or want to make a political point anyway.

When I fly with Cathy Pacific I am typically served by Chinese stewards (or more likely stewardesses) and their hub and head office is in a significant Chinese town (Hongkong). Yes, their owners have British roots (and I didn't count who owns most shares of the SWIRE group) - and their board / management team is mainly Caucasian (well 2/3 rds or so).

If that's relevant, than I guess this makes Sanford a German company, given that their CEO is German ... :p

Anyway - If you feel that they are not a Chinese airline - be my guest ... however not sure, who would feel offended by this classification. Are you? If yes - WHY?

Please note - I never said "airline of the Peoples Republic of China" ....).

[sharp]

How do they say ... everybody is entitled to their opinion.
Just wait for fuel to go up and lets then continue this discussion ...



I think you misunderstood - or want to make a political point anyway.

When I fly with Cathy Pacific I am typically served by Chinese stewards (or more likely stewardesses) and their hub and head office is in a significant Chinese town (Hongkong). Yes, their owners have British roots (and I didn't count who owns most shares of the SWIRE group) - and their board / management team is mainly Caucasian (well 2/3 rds or so).

If that's relevant, than I guess this makes Sanford a German company, given that their CEO is German ... :p

Anyway - If you feel that they are not a Chinese airline - be my guest ... however not sure, who would feel offended by this classification. Are you? If yes - WHY?

Please note - I never said "airline of the Peoples Republic of China" ....).

No political point was intended.

"however not sure, who would feel offended by this classification. Are you? If yes - WHY? " Appears to be that I would be offended in anyway by you calling Cathay a Chinese airline. I am not. You are also asking me in a not so direct way, whether I am Chinese or rather Hong Kongese which I am not.

Your comment on whether Sanford should be called a German company is nothing other than condescending.

Thank you for your very thoughtful insights.

[Snow Leopard]

...
To put into perspective how many other companies are we comparing the SP with NTA (including or excluding intangibles)?
...

If you are happy to work on rpuNTA (Roger's peculiarily unique NTA) then the best buy is non other than:

Virgin Australia Holdings listed on the ASX which is currently trading under rpuNTA.

Other excellent airlines with low SP/NTA ratios to consider are:
Singapore Airlines on the Singapore Exchange (trading about NTA);
Cathay Pacific on the Hong Kong Bourse (trading a little above NTA).

This is not a recommendation to buy any airline or other stock.

Best Wishes
Paper Tiger

[couta1]

daily graph looks like a sine wave. It ain't called the Aircoaster for nothing.

[workingdad]

It ain't called the Aircoaster for nothing.

Pretty slow moving one today. Not that I am complaining

[Beagle]

Hmmm, but didn't Timothy say "24 And the Lord’s servant must not be quarrelsome but must be kind to everyone, able to teach, not resentful. 25 Opponents must be gently instructed, in the hope that God will grant them repentance leading them to a knowledge of the truth..."

Nothing said about blocking them out?

What Couta1 said plus one needs to keep in mind a lot of other relevant scripture and the my decision to move anyone to the ignore list is on the basis of Romans 14:19 So then let us pursue what makes for peace and mutual uplifting. Also Proverbs 26:4, 23:9, 29:1, 19:11 and especially Proverbs 9:7-9 spring to mind, I will leave you and others to look them up if you're interested.

Anyway getting back to AIR I think we see this no mans land SP grind on for a couple more weeks yet. Speaking of balance sheet footings I see our currency up over 70 cents U.S. If this sticks till balance date then we will see overseas debt including capitalised lease obligations looking better in $Kiwi and thus the gearing ratio come down at balance date. Should be a supportive environment for a slightly bigger dividend than might have otherwise been the case at 65 cents U.S.

[Baa_Baa]

Worryingly the AIR share price rout is happening contrary to a backdrop of NZX reaching new highs and staying in lofty territory, lots of NZ shares doing handsomely, and the global markets surging upwards for example in the US looking to test all time highs. It's all very well to shrug off increasing competition, or hope for a good outcome to the VAH mess, or the minutae like oil prices etc, but heaven forbid a change in global sentiment affecting the whole NZ market. It's events like that which aren't considered that plumbs the depths of historical share prices, that in the present moment seem ludicrous in the extreme, like almost impossible that it could ever go to $1.75, let alone lower. Keep in mind AIR has deflated against an extremely positive backdrop, so factor into your thoughts what might happen if that backdrop turned unfavourable.

[couta1]

I can think of quite a few shares with a hammered SP that hardly moved in a general downturn Baa, it seems the market understands at those times that those shares don't require the same trimming as the lofty, fully or overvalued ones, sure it may drop but the drop would be minor in comparison IMO.

[workingdad]

I wonder if a resolution of VAH situation will be the boast AIR needs. The uncertainty of it is surely a big factor for anyone looking to buy in with the potential to positively or negatively impact on end of year results.
Looking at the chart the trading range seems to be stabilizing but the ability to be irratic on any given day is always on the cards. I followed it closely today and there weren't a lot of sell orders lining up, just drip fed at buy price and less crumbling of sellers when it dipped early afternoon.

[Gizzajob I can do that]

I wonder if a resolution of VAH situation will be the boast AIR needs. The uncertainty of it is surely a big factor for anyone looking to buy in with the potential to positively or negatively impact on end of year results.
Looking at the chart the trading range seems to be stabilizing but the ability to be irratic on any given day is always on the cards. I followed it closely today and there weren't a lot of sell orders lining up, just drip fed at buy price and less crumbling of sellers when it dipped early afternoon.
Bang on, every time the SP looked to take off it was compromised by a quick dump of approx 5k of stock, mind you that is better than the 20k lots that were dumped earlier in the downfall

[Baa_Baa]

I can think of quite a few shares with a hammered SP that hardly moved in a general downturn Baa, it seems the market understands at those times that those shares don't require the same trimming as the lofty, fully or overvalued ones, sure it may drop but the drop would be minor in comparison IMO.

I would expect nothing less than an optimistic response, you're inspirational, I have learnt a great deal over the years from you sharing your investment and trading strategy.

Only four and a bit short years ago, AIR was .85 in Jan 2012 which was a long time after the GFC rout in '08/09 which took it to .75. I really think it does help to understand what 'cyclical' actually means. Apart from the hurt, years and years go by before the SP recovers, in AIR's case the cycle top to top is close to 10 years and we're all chatting about it when it's already 40+% off it's 10 year high.

Doing some swat on 'stop loss orders' might help as well, just in case.

[workingdad]

Does anyone think the oil prices are being overthought or rather too much weight assigned?

Historically oil prices have been considerably higher than $50 a barrel yet airlines have turned profits, 3 years ago if we thought oil would drop from over $100 a barrel to $50 wouldn't that have been considered a great thing.

So it went a lot lower (and beyond anyone's real expectations) and now slowly came back hitting the magic $50 mark. Shale producers are starting to fire up idle rigs so supply will increase and perhaps limit the on going price recovery.

Latest from the US - seems like perhaps supply is starting to come on line again. http://money.cnn.com/2016/06/09/investing/oil-companies-pumping-more-50-dollars/index.html

Will the oil prices continue to rise as supply starts to increase again? With regard to AIR, I cant see $60 a barrel with a modern fleet be a barrier to future profits or am I missing something? Some have said it will help as competition cuts back due to increased oil prices.

There is still the increased competition to deal with but increased tourism offsets that somewhat and the domestic market is still pretty stitched up.

Monthly stats may be out today, hopefully maintaining good RPKs.

[couta1]

The Mutt has been sold, well 20% of it.:t_up:

[workingdad]

Yay. .33 per share. Interesting that it's less than what HNA paid..... Maybe they should have bought from AIR

[couta1]

Yay. .33 per share. Interesting that it's less than what HNA paid..... Maybe they should have bought from AIR Didn't HNA pay 30c ?

[winner69]

The Mutt has been sold, well 20% of it.:t_up:

.....and I thought you had sold some AIR shares

[BlackPeter]

Does anyone think the oil prices are being overthought or rather too much weight assigned?

Historically oil prices have been considerably higher than $50 a barrel yet airlines have turned profits, 3 years ago if we thought oil would drop from over $100 a barrel to $50 wouldn't that have been considered a great thing.

So it went a lot lower (and beyond anyone's real expectations) and now slowly came back hitting the magic $50 mark. Shale producers are starting to fire up idle rigs so supply will increase and perhaps limit the on going price recovery.

Latest from the US - seems like perhaps supply is starting to come on line again. http://money.cnn.com/2016/06/09/investing/oil-companies-pumping-more-50-dollars/index.html

Will the oil prices continue to rise as supply starts to increase again? With regard to AIR, I cant see $60 a barrel with a modern fleet be a barrier to future profits or am I missing something? Some have said it will help as competition cuts back due to increased oil prices.

There is still the increased competition to deal with but increased tourism offsets that somewhat and the domestic market is still pretty stitched up.

Monthly stats may be out today, hopefully maintaining good RPKs.

Just relax ... my from time to time infallible technical analysis clearly shows that AIR is in an unbroken continuous uptrend since 2005:

8102

So what can possibly go wrong?

As well - if you are looking for reasons for AIR (or any other company) to turn the trend and go up again ... no doubt, you will find some. There are always good reasons for a company to be successful (otherwise nobody would run it).

If you are however looking for warning signs - hey, if you want to see them, the dark clouds at the horizon are not difficult to see.

Fact is - AIR so far behaved quite cyclical, and this is true for most (all?) airlines. It had an amazing peak (personally I think the market went ways above what seems to be a sensible price, looking at the long term earnings) and it is since then coming down. Just a natural part of the cycle ...

The current SP is now well past the death-cross ... and while it is possible to prove nearly anything using TA (if you take the right indicators - just look at the graph above) do I not believe that there are any serious technical analysts around showing AIR still in an uptrend (but I might be wrong - MA 2000 anybody ;)?).

In reality nobody can predict how the SP is going (and certainly not on a short term basis), but long term experience shows that cyclical companies past their peak are more likely to continue their decline than reverse the trend ... of course, only until they reach the (cyclical) bottom.

Just looking at my amazing graph again ... $1.25 (in another couple of years) looks like a great entry to go back into AIR - but maybe I am just dreaming?

Disclaimer: This is not a recommendation to buy or sell any shares at any price - just sharing some personal observations.
Disclosure: don't hold;

[Beagle]

Satisfactory result in my opinion. NTA is circa 30 cps and to be frank there was no reason anyone would want to pay much of a premium for a stake in VAH when its losing money in a low oil price environment and its up to its ears in debt with a 6:1 debt to equity ratio.

[Master98]

http://www.smh.com.au/business/aviation/chinas-nanshan-group-to-buy-virgin-australia-stake-from-air-new-zealand-20160609-gpfw5q.html

China's Nanshan Group to buy Virgin Australia stake from Air New Zealand

[workingdad]

.....and I thought you had sold some AIR shares

Rather amazing and contrary to recent timings I came back in yesterday but sadly only half what I had.

Bought and sold a few times. Last was in at 2.17 then out at 2.24. Then in again yesterday at 2.15. I nearly grabbed them at 2.13 the day before but didn't quite have the nerve.

All good. I'm not complaining. Should see a stronger SP today

[workingdad]

Didn't HNA pay 30c ?

Oh. I had in mind it was 40c for some reason. Need to remember to take Alzheimer's meds....

[winner69]

Great outcome

Just as well these Chinese companies love spending heaps of money eh

With such a hotchpot of owners be interesting to see what happens to Virgin over the next few years

[Balance]

Great outcome

Just as well these Chinese companies love spending heaps of money eh

With such a hotchpot of owners be interesting to see what happens to Virgin over the next few years

So much for all the commentators and detractors who thought that Air NZ will not be able to sell the stake and has played themselves out of the game.

Always watch out for the vested interests who feed 'stories' to the media etc for their own purposes - eg. AFR with its article about how Virgin has 'done' Air NZ in the corporate maneuverings.

[BlackPeter]

Great outcome

Just as well these Chinese companies love spending heaps of money eh

With such a hotchpot of owners be interesting to see what happens to Virgin over the next few years

Great outcome? I suppose you mean it could have been worse?

According to the article did AIR NZ paid $453 m for their Virgin stake and sold it now for $ 232 m; This is still a $221 million loss.

[Xerof]

Great outcome

With such a hotchpot of owners be interesting to see what happens to Virgin over the next few years

Only thing for sure is it has lost it's virginity W69 :eek2:

[couta1]

Great outcome? I suppose you mean it could have been worse?

According to the article did AIR NZ paid $453 m for their Virgin stake and sold it now for $ 232 m; This is still a $221 million loss. They haven't sold their total stake so you can't calculate it like that yet.

[Balance]

Great outcome? I suppose you mean it could have been worse?

According to the article did AIR NZ paid $453 m for their Virgin stake and sold it now for $ 232 m; This is still a $221 million loss.

Given the doomsday scenarios posted and voiced by many commentators that Air NZ cannot sell the stake, will be socked for more money, will be marginalized, its planes will fall from the Trans Tasman skies etc etc - it is a great outcome.

Read the various articles in the Aussie Press about how Air NZ was going to get rooted by Virgin yet again.

[Beagle]

So much for all the commentators and detractors who thought that Air NZ will not be able to sell the stake and has played themselves out of the game.

Always watch out for the vested interests who feed 'stories' to the media etc for their own purposes - eg. AFR with its article about how Virgin has 'done' Air NZ in the corporate maneuverings.

Couldn't agree more. In my opinion its good to simply get this deal executed. Couta1 is dead right, VAH is a real flea ridden mutt and serious questions have to be asked about its business model after losing money for years. Sadly VAH's Q3 profit announcement and outlook statement wherein they ostensibly indicated they would struggle to break even in Q4 came as a shock and scuttled any chance of AIR getting its money back in full but you win some and you lose some and AIR will make plenty this year so a circa $100m loss on sale while not brilliant is still a good way to surgically remove what I view as a massive thorn in their side. Special divvy is now very much on the cards.

[couta1]

I can't believe the NZ Herald who are always so quick to put up bagging articles on Air haven't got this news up as I write.

[workingdad]

Couldn't agree more. In my opinion its good to simply get this deal executed. Couta1 is dead right, VAH is a real flea ridden mutt and serious questions have to be asked about its business model after losing money for years. Sadly VAH's Q3 profit announcement and outlook statement wherein they ostensibly indicated they would struggle to break even in Q4 came as a shock and scuttled any chance of AIR getting its money back in full but you win some and you lose some and AIR will make plenty this year so a circa $100m loss on sale while not brilliant is still a good way to surgically remove what I view as a massive thorn in their side. Special divvy is now very much on the cards.

Even without the direct effect on SP of a special divvy surely the uncertainty that has been hanging around with VAH will also help to strengthen it.

[skid]

Welllll....Been away for a week so thought Id catch up on the AIR thread....WOW....
some of the high points...coutts, are you now basing your investment decisions on that Houdini act you did with Xero?

the ole censorship debate has come up again(not sure why we cant just have the discipline to not respond to inflammatory posts instead of censoring them (to our self) Is the ''closing down the whole thread (like PEB) debate going to surface again?--but the good part is that it has all been rationalized by the scriptures(''Lord..give me strength''...(that must be in there somewhere)

Whether Cathay Pacific is a Chinese run airline is now vitally important on the efficiency of getting Chinese bums around the globe.

And of course the balance sheet..(well ,that was expected)

And the weird thing is that ,after all those psychological ups and downs...SP is the same as when I left.....(I might have to do this more often)

Just about time to go ride a motorbike around a country where the challenges facing many are some how far more ''real''(my greatest challenge will be where to find the next bed for the night(I hope)

''Daddy ,why am I feeling down?''...'thats easy son...Youve been spending to much time in ..cyberspace''...When that happens just turn off you computer and go open your ''Book Of Skid''...go to the last verse,..the summery of all...and read...''Momma told me there would be days like this''

[couta1]

No Skid, I was just comparing the nature of the Aircoaster to that of the Xrocoaster, I'm long on Air, happy to collect the divvies and ride this blue chip. PS-There was touch of humour incorporated in case you didn't pick up on that.:cool:

[workingdad]

I can't believe the NZ Herald who are always so quick to put up bagging articles on Air haven't got this news up as I write.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11654098

Wonder if HNA will want the remaining 6% as they intend to increase the 13.3 to 19.9%......

[Master98]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11654098

Wonder if HNA will want the remaining 6% as they intend to increase the 13.3 to 19.9%......
good point at 40c per share.

[kiwichick]

The news doesn't seem to be helping the share price any though.

[workingdad]

good point at 40c per share.

Australian too ey ;)

[Balance]

The news doesn't seem to be helping the share price any though.

Market will do what it wants to do until the analysts and fund managers get their computers out, do some scenarios and talk to management.

First reaction I have been given is that Air NZ has more than enough imputation credits to make a special payment from the proceeds so it's definitely one option on the cards.

[Balance]

Market will do what it wants to do until the analysts and fund managers get their computers out, do some scenarios and talk to management.

First reaction I have been given is that Air NZ has more than enough imputation credits to make a special payment from the proceeds so it's definitely one option on the cards.


Meanwhile, sustainable dividend yield expected to be in excess of 10% (fully imputed) for next 3 years.

[Snow Leopard]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11654098

Wonder if HNA will want the remaining 6% as they intend to increase the 13.3 to 19.9%......

The 19.98% stake is 19.98% of the new enlarged VAH (ie post HNA new equity issue) so AIR will only have a 2.6% stake left.

see AIR announcement for details

Best Wishes
Paper Tiger

[Master98]

The 19.98% stake is 19.98% of the new enlarged VAH (ie post HNA new equity issue) so AIR will only have a 2.6% stake left.

see AIR announcement for details

Best Wishes
Paper Tiger
so can be sold on market if needed without file SSH notice.

[Xerof]

Stuff article: The national carrier announced on Friday that Chinese conglomerate Nanshan Group will buy a 19.98 per cent stake in Virgin at A33 cents (NZ31.54c) a share.

I usually don't bother reading press articles - that is why.......

[Balance]

I usually don't bother reading press articles - that is why.......

Pathetic - the journo and the business editor have not got a clue! And they are writing articles about the economy and the debt burden etc etc.

[couta1]

Actually it wasn't the NZ Herald article that quoted that figure but rather the article on Stuff, sent them an email giving them the correct figure of 34.32c NZ, see if they change it.

[Nasi Goreng]

Well I would imagine that VAH would now have to pay back the loan to AIR. If AIR was still a shareholder, they would have no doubt offered them share options but now, you would have to think they would pay it back unless there is fine print to suggest otherwise so that shouldn't be a write off any more.

[couta1]

Actually it wasn't the NZ Herald article that quoted that figure but rather the article on Stuff, sent them an email giving them the correct figure of 34.32c NZ, see if they change it. They have just changed it.

[Snow Leopard]

Well I would imagine that VAH would now have to pay back the loan to AIR. If AIR was still a shareholder, they would have no doubt offered them share options but now, you would have to think they would pay it back unless there is fine print to suggest otherwise so that shouldn't be a write off any more.

Why would you imagine that?

There was no mention of the loan either being repaid or on sold in the announcement so you are best assuming, for now, that the loan is still with AIR and will be repaid on the original terms.

Best Wishes
Paper Tiger

[workingdad]

The 19.98% stake is 19.98% of the new enlarged VAH (ie post HNA new equity issue) so AIR will only have a 2.6% stake left.

see AIR announcement for details

Best Wishes
Paper Tiger

I don't understand that PT. wouldn't a sale of a percentage of holdings be on current number of shares not based on a possibility (or probability whichever way you look at it) of new issue yet to be approved?

I appreciate the time you take to offer insight on the various posts you do. It does benefit us lesser experienced ones balancing out various perspectives.

[freddagg]

So what is the thinking now on the final dividend, maybe 15c plus a special of 20c to 25c ?

[Master98]

So what is the thinking now on the final dividend, maybe 15c plus a special of 20c to 25c ?
I really like these numbers:t_up:

[Beagle]

http://www.smh.com.au/business/aviation/chinas-nanshan-group-to-buy-virgin-australia-stake-from-air-new-zealand-20160609-gpfw5q.html

Just a really quick back of the envelope calculation based on a press article which is always an incredibly dangerous thing to do. FACT - Book value of AIR's stake in VAH as at 30 June 2015 was $360m Kiwi. Going off memory this had already been written down by some $50m Kiwi (IIRC) in previous years.
Sale value, SPECULATION (subject to regulatory consents) as reported in the Australian press $232m I presume $A = approx. $250m Kiwi and they've sold roughly 19.9 / 22.5 (their stake assuming HNA issue proceeds) = 88.44% of their stake sold so if they can sell the rest at the same price their stake is worth $250m Kiwi / 0.8844 = $282.7m Kiwi less transaction costs and advisory fees. So a loss on book value as at 30 June 2015 of circa $77.3m plus transaction costs to be booked in the financial year in which the sale goes unconditional. (DYOR, not to be considered professional advice or a recommendation and I am certain the resident prickly cat will have a different view).

[workingdad]

With all the interest in VAH perhaps AIR should put up a bit of a steak to the Chinese 😎

[Snow Leopard]

...see AIR announcement for details...


I don't understand that PT. wouldn't a sale of a percentage of holdings be on current number of shares not based on a possibility (or probability whichever way you look at it) of new issue yet to be approved?

I appreciate the time you take to offer insight on the various posts you do. It does benefit us lesser experienced ones balancing out various perspectives.

Link to Announcement (https://www.nzx.com/files/attachments/237218.pdf)

from Announcement:
"Today, Air New Zealand (NZX: AIR) is pleased to advise that it has entered into a Sale & Purchase Agreement (the Agreement) with Nanshan Group in respect of its stake in Virgin Australia. Under the Agreement, Air New Zealand will sell shares held in Virgin Australia at A$0.33 per share. Following the sale, Nanshan Group will have a shareholding of approximately 19.98% in Virgin Australia1." << see that 1 ?

from Announcement
"1 Based on Virgin Australia’s expected issued capital outstanding following the HNA Group equity investment as announced by Virgin Australia on 31 May 2016."

Best Wishes
Paper Tiger

[Bobdn]

If we do get a special dividend from the sale, how might it be worth?

[Xerof]

A perfectly good envelope used there Roger, although I was talking to my broker when I bought in a few weeks ago, and his figure for write downs to date was 70m, so could be even better than you indicate.

The tiger is also perfectly logical and purring on all cylinders WRT the loan. AIR shall be repaid in the fullness of time, which is set to be about 5 minutes after VAH complete their expected CR of $800m AUD, alleged to occur as soon as this month

[Bobdn]

Sorry, missed the above discussion and question appears o have been answered

[workingdad]

Link to Announcement (https://www.nzx.com/files/attachments/237218.pdf)

from Announcement:
"Today, Air New Zealand (NZX: AIR) is pleased to advise that it has entered into a Sale & Purchase Agreement (the Agreement) with Nanshan Group in respect of its stake in Virgin Australia. Under the Agreement, Air New Zealand will sell shares held in Virgin Australia at A$0.33 per share. Following the sale, Nanshan Group will have a shareholding of approximately 19.98% in Virgin Australia1." << see that 1 ?

from Announcement
"1 Based on Virgin Australia’s expected issued capital outstanding following the HNA Group equity investment as announced by Virgin Australia on 31 May 2016."

Best Wishes
Paper Tiger

Thank you. I read it twice and still didn't put it together.... From Alzheimer's meds to a stroke of some sort obviously.
Cheers

[cyclist]

Thank you. I read it twice and still didn't put it together.... From Alzheimer's meds to a stroke of some sort obviously.
Cheers

Only visible if you read the pdf version. The basic text version doesn't show the footnote. So you may not be as mad as you thought ....

[Snow Leopard]

Thank you. I read it twice and still didn't put it together.... From Alzheimer's meds to a stroke of some sort obviously.
Cheers

Always, always, always, always:

Carefully read the PDFs linked in the announcement, save them to your hard drive for later retrieval if you think they contain important information (and save them to your hard drive even if you do not but you have the free space).

Probably get drummed out of the Cubs for revealing this.:(

Best Wishes
Paper Tiger

[Snow Leopard]

http://www.smh.com.au/business/aviation/chinas-nanshan-group-to-buy-virgin-australia-stake-from-air-new-zealand-20160609-gpfw5q.html

Just a really quick back of the envelope calculation based on a press article which is always an incredibly dangerous thing to do. FACT - Book value of AIR's stake in VAH as at 30 June 2015 was $360m Kiwi. Going off memory this had already been written down by some $50m Kiwi (IIRC) in previous years.
Sale value, SPECULATION (subject to regulatory consents) as reported in the Australian press $232m I presume $A = approx. $250m Kiwi and they've sold roughly 19.9 / 22.5 (their stake assuming HNA issue proceeds) = 88.44% of their stake sold so if they can sell the rest at the same price their stake is worth $250m Kiwi / 0.8844 = $282.7m Kiwi less transaction costs and advisory fees. So a loss on book value as at 30 June 2015 of circa $77.3m plus transaction costs to be booked in the financial year in which the sale goes unconditional. (DYOR, not to be considered professional advice or a recommendation and I am certain the resident prickly cat will have a different view).

I hardly like to bring this up given the above closing remark but:

It is 19.98% of the expanded VAH that has gone under the hammer.

AIR have just sold approx 807.7M shares at $0.33 which is A$266.5M

AIR had 913,503,208 VAH shares and if they sell the lot at $0.33 that would be A$301.5M

As Always Best Wishes
Paper Tiger

[Nasi Goreng]

Why would you imagine that?

There was no mention of the loan either being repaid or on sold in the announcement so you are best assuming, for now, that the loan is still with AIR and will be repaid on the original terms.

Best Wishes
Paper Tiger



Well that was my point but I wasn't very clear. When it was originally loaned out, the SP dropped and many thought the money was as good as gone. I think now as a result of this, AIR should get their money back... eventually.

[Beagle]

Well that was my point but I wasn't very clear. When it was originally loaned out, the SP dropped and many thought the money was as good as gone. I think now as a result of this, AIR should get their money back... eventually.

No question about that now. Its clear that with the new shares issued recently and the stated willingness of new shareholders to be supportive of a capital raise AIR will get their loan repaid in due course, (was only a short term 12 month loan when originally advanced).

[winner69]

Does this mean Nanshan can't buy the AIR shares until HNA pump in their $159m and get new shares - otherwise Nanshan will have more than 20% (a problem?)

What u reckon pt?

[Snow Leopard]

Does this mean Nanshan can't buy the AIR shares until HNA pump in their $159m and get new shares - otherwise Nanshan will have more than 20% (a problem?)

What u reckon pt?
It is PT [capitals] :p if you don't mind.

Yes, the HNA thing has to happen before Nanshan thing can happen and this all depends upon Chinese Regulatory approvals.
Otherwise the Nanshan thing would need to be renegotiated or other approvals obtained.

Maybe they will go down to the office together and the first thing and the second thing can happen a few moments apart.

Best Wishes
Paper Tiger

Disc: Will be back in China in July

[Snow Leopard]

Well that was my point but I wasn't very clear. When it was originally loaned out, the SP dropped and many thought the money was as good as gone. I think now as a result of this, AIR should get their money back... eventually.

I guess there existed that as part of any capital raising the loan would effectively be converted to equity but to have the impression that AIR would never get their money back!
Well, really?

Best Wishes
Paper Tiger

[percy]

I sold out today.

[winner69]

It is PT [capitals] :p if you don't mind.

Yes, the HNA thing has to happen before Nanshan thing can happen and this all depends upon Chinese Regulatory approvals.
Otherwise the Nanshan thing would need to be renegotiated or other approvals obtained.

Maybe they will go down to the office together and the first thing and the second thing can happen a few moments apart.

Best Wishes
Paper Tiger

Disc: Will be back in China in July

So possibility might not be all settled by June 30th as AIR were aiming for?

[Mista_Trix]

I sold out today.

Not really the jump everyone was hoping for eh.

[Snow Leopard]

So possibility might not be all settled by June 30th as AIR were aiming for?

Don't quote me on this but:

万事俱备 只欠东风

Best Wishes
Paper Tiger

[workingdad]

Not really the jump everyone was hoping for eh.

Shaping up to be another 'normal' AIR trading day..... big volume going through. I'm happy to see the monkey off the back with VAH and eagerly await a special divvy from it

[Master98]

So possibility might not be all settled by June 30th as AIR were aiming for?
Answer is here:

The sale to Nanshan is likely to occur after Virgin’s A$159 million equity placement to HNA Group which will dilute Air New Zealand’s 25.9 percent stake to 22.5 percent. That means it will have a residual 2.5 percent shareholding in Virgin following the Nanshan sale which Air New Zealand chairman Tony Carter said would be considered “in due course”.

[Balance]

Answer is here:

The sale to Nanshan is likely to occur after Virgin’s A$159 million equity placement to HNA Group which will dilute Air New Zealand’s 25.9 percent stake to 22.5 percent. That means it will have a residual 2.5 percent shareholding in Virgin following the Nanshan sale which Air New Zealand chairman Tony Carter said would be considered “in due course”.

Looks like HNA Group and Virgin are the ones played out by Air NZ - contrary to all the Aussie media reports!

[winner69]

Looks like HNA Group and Virgin are the ones played out by Air NZ - contrary to all the Aussie media reports!

Google Nanshan and Song Zuowen (in particular) and if you dig a little one can work out who might really control Nanshan

Could be interesting times for Virgin

Maybe Luxon has the laugh last

[skid]

No Skid, I was just comparing the nature of the Aircoaster to that of the Xrocoaster, I'm long on Air, happy to collect the divvies and ride this blue chip. PS-There was touch of humour incorporated in case you didn't pick up on that.:cool:

With me as well--thought we needed a bit of lightning up---I agree with you regarding the NZ Herald--Its almost as if some over there are intentionally trying to whack AIR(not that they dont have a point,but sometimes it seems a bit excessive)

[Snow Leopard]

Google Nanshan and Song Zuowen (in particular) and if you dig a little one can work out who might really control Nanshan

Could be interesting times for Virgin

Maybe Luxon has the laugh last

Of more interest to AIR shareholders now should be the apparent quote from Chairman Carter yesterday that:

"The sale will allow Air NZ to focus on its own growth opportunities"

Although it would be pure speculation at this point but is this all/most/some/none of the recovered cash going to be re-invested and in what?

Best Wishes
Paper Tiger

[skid]

Not really the jump everyone was hoping for eh.

Im not making any predictions but this does bring to mind a few times that there has been a lag,before a jump or fall,in several share I have seen over the years---Ive always been puzzled by that..almost as if the market needed a bit of time to digest.

Ill never forget when NZO hit the Tui oil field and the sP went DOWN a few cents--It was just a negative atmosphere at the time--it of course raced after (no comparison intended)

Whatever the SP ,I suppose the divi has to be factored in(whatever that is)

[Beagle]

Headline in the NBR yesterday Air NZ makes loss of hundreds of millions on sale of Virgin stake The implication was that there is a further loss to be booked of at least $200m and potentially much more. Usually one of the more reliable sources but this didn't look right so I did some digging.

I know for a fact AIR have already taken a write-down on the value of their stake, IIRC this was $50m in a previous year but as at 30 June 2015, see note 12 on page 20 of last years accounts the carrying value of their stake in Virgin was listed at $360m Kiwi.

Looking through Virgin's last annual report AIR are listed as having 913,503,208 shares, (see page 126). If we assume they can get 33 cents Australia for all their shares in due course, (they are selling circa 90% of their stake at this price) that would give a value of $A301,330,606 or based on Friday's interbank exchange rate of 0.9560 = $N.Z.315,330,606, thus a further write-down of $44,669,394 plus whatever their transaction costs and advisor fees are is what we are looking at in the financial year in which this proposed deal goes unconditional.

I note this further write-down amount is less than the proposed settlement of the air cargo matter in America which was just on $51m Kiwi. I think that puts the further loss required to be accounted for into its proper perspective.

If they hadn't taken this further circa $50m (after transaction costs) hit then a bit like the American cargo matter how much more could they have been on the hook for in terms of a capital raise ?
When one is in a black hole, its best to stop digging and climb out rather than buying a new spade and digging harder. Most investors are old enough to remember the Ansett fiasco and the last thing we need is a repeat of that.

Its my sincere hope that this post gives investors some comfort...after all the roller coaster ride has been pretty severe.

[mikeybycrikey]

Of more interest to AIR shareholders now should be the apparent quote from Chairman Carter yesterday that:

"The sale will allow Air NZ to focus on its own growth opportunities"



They have been saying that all along.

In the original document where AIR announced the VAH review they say "Mr Carter says Air New Zealand does not want a large minority equity position in Virgin Australia as it focuses on its own growth opportunities."

I'm certainly not expecting the VAH money to be distributed via a special dividend (although that not to say that there won't be a special).

[Beagle]

An exchange rate over $U.S.70c lowers their balance sheet footings in terms of overseas debt and capitalised lease obligations and will improve their gearing.
Again reported in the NBR that their capex is just over $2b in the next few years but as previously mentioned this is only circa $600 - $700m more than the normal rate of fleet depreciation over that timeframe so net capex is really not such a frightening figure at all especially viewed in the context that they had paid $520m in aircraft deposits already as at 30 June 2015.

Further, we know this is the peak of the earnings cycle. Provided the VAH sale gets the necessary Chinese authorities approval I think we can take it as a given that there will be a special dividend this year, (management were stung by shareholder criticism that there wasn't one last year and I am sure they don't want widespread contempt to reveal itself at the next annual meeting) and there is the very real prospect it'll be bigger than the usual 10 cps paid in various years in the past. The sale proceeds by my calculations, (again not relying on media reports) are 25 cents Kiwi per share less transactions costs so taking into account its been a record year for profit anyway with low oil prices and the fairly miserable interim dividend I see no reason why they can't pay the lot out but they probably won't. Management will probably have some "highly desirable" environmentally friendly pet project they want to fund so maybe us lowly shareholders, (you know the poor sods that they're actually supposed to be running this business for) might be lucky to get a special of 10 - 15 cps ?

Prospects for a final dividend. I think 10-12 cps. Best guess of total, 20-27 cps..risk is probably skewed slightly to the upside. Full imputation credits will apply to dividend(s) paid, that's the one and only thing you can be absolutely certain of.

[axe]

Uncle John and uncle Bill still might want a special divvy. :)


They have been saying that all along.

In the original document where AIR announced the VAH review they say "Mr Carter says Air New Zealand does not want a large minority equity position in Virgin Australia as it focuses on its own growth opportunities."

I'm certainly not expecting the VAH money to be distributed via a special dividend (although that not to say that there won't be a special).

[Master98]

http://m.smh.com.au/business/aviation/chinas-nanshan-group-to-buy-virgin-australia-stake-from-air-new-zealand-20160609-gpfw5q.html

Air New Zealand will receive around NZ25¢ per share in net proceeds and repayment of its $131 million share of the $425 million loan.
"After both events we believe Air New Zealand will most likely return net proceeds from the Virgin shareholding sale to its shareholders via special dividend," UBS said. "While exact timing is difficult to judge, we expect this to occur before the end of August."

[mikeybycrikey]

Uncle John and uncle Bill still might want a special divvy. :)

I still expect that there is likely to be a special dividend. Probably 10 cps rather than the 35 cents per share it might be if it included the VAH payout.

I would like some indictation from AIR of what they mean by "growth opportunities" though. $300m probably doesn't even get you 1 Dreamliner, does it? Maybe some Airbus 350 ULR's for flights to New York and Cape Town? Flights to India?

Could be interesting.

[Beagle]

AIR's speak about investing in its own growth opportunities at the time of the announcement of their review of their holding in VAH is just public relations speak for we'd rather have that capital earning a respectable rate of return in our own operations than languishing and earning nothing in this sick pup...nothing more nothing less.

[winner69]

AIR's speak about investing in its own growth opportunities at the time of the announcement of their review of their holding in VAH is just public relations speak for we'd rather have that capital earning a respectable rate of return in our own operations than languishing and earning nothing in this sick pup...nothing more nothing less.

That's spot on Roger

Now the Virgin distraction has been eliminated they can back to focussing on progressively unleashing an expanded array of potentialities

[workingdad]

I am going to hang in there with the AIR shares for now and see where resistance is. Actually thinking about getting the other half I had with it barely being over the pre virgin sale announcement price but want to see a couple of days trading first, at least volume is not indicating a big boys or girls sell off and with a public holiday in Australia tomorrow may give more insight.

Thanks for all the effort put into the posts of late by the usual contributors - it is appreciated :)

[777]

That's spot on Roger

Now the Virgin distraction has been eliminated they can back to focussing on progressively unleashing an expanded array of potentialities

The money is not in the bank yet.

[ohpark0119]

looking at the index, AIR isn't the only one on a landslide... Just to make myself feel better

[777]

Point 7 percent is a land slide?

NZSX 50 6924.27 -47.5 0.7%

[Xerof]

^^ anybody else's eyebrow's twitch at this statement?


http://m.smh.com.au/business/aviation/chinas-nanshan-group-to-buy-virgin-australia-stake-from-air-new-zealand-20160609-gpfw5q.html

Air New Zealand will receive around NZ25¢ per share in net proceeds and repayment of its $131 million share of the $425 million loan.
"After both events we believe Air New Zealand will most likely return net proceeds from the Virgin shareholding sale to its shareholders via special dividend," UBS said. "While exact timing is difficult to judge, we expect this to occur before the end of August."

[Baa_Baa]

^^ anybody else's eyebrow's twitch at this statement?

Yes for sure. Has anyone worked out how many cents per share was invested by AIR in VAH to achieve the "NZ25¢ per share in net proceeds" .. ergo what's the actual size of the loss that they and some brokers are spinning into a 'win' for shareholders by speculation of a special divvy. Anyone who has owned throughout the journey of VAH is losing net net, ergo all of the big players, who may have a somewhat dimmer view of the matter, though recent acquirers of course will just enjoy the (potential) returns and have no mind for the losses.

[Snow Leopard]

^^ anybody else's eyebrow's twitch at this statement?

As in it is not enough to buy one extra new Dreamliner?

Best Wishes
Paper Tiger

[NZ$0.25/share is approx US$200, Boeing 787-9 list price is approx US$265]

[Xerof]

Please explain how AUD33 cents per share becomes NZD25 cents per share net proceeds - are their brokers taking 100million as a fee? ^^ if so, who should I send my CV to for a job with them please. (the broker, not AIR)

[Snow Leopard]

Please explain how AUD33 cents per share becomes NZD25 cents per share net proceeds - are their brokers taking 100million as a fee? ^^ if so, who should I send my CV to for a job with them please. (the broker, not AIR)

That was AU$0.33 for about 808M (if Nanshan only) or 903M (for all AIR stake) VAH shares.

There are 1,123M AIR shares.

It pans out

Best Wishes
Paper Tiger

[Xerof]

Ok, gotcha PT, thanks.

[winner69]

Hope AIR doesn't follow this fan-dangled ^XAL index today!!

[Raz]

Hope AIR doesn't follow this fan-dangled ^XAL index today!!

Yes it will be interesting!

[bull....]

plane is descending will the 2.05 hold? no special div? say what

[sb9]

plane is descending will the 2.05 hold? no special div? say what

Big support at 210 currently, see if that holds first.

[couta1]

plane is descending will the 2.05 hold? no special div? say what In case you haven't noticed, the market is getting trashed so that may give you a clue as to why the Air SP is also falling aye.

[workingdad]

plane is descending will the 2.05 hold? no special div? say what

Curious as to the 'no special div?' comment. Could you elaborate.

[bull....]

Curious as to the 'no special div?' comment. Could you elaborate.

im speculating cause they got big expenses in new aircraft and declining revenues on the horizon can they really afford too? maybe depends if the biggest s/h has there arm twisted behing there back a,whispering in there ear

[couta1]

im speculating cause they got big expenses in new aircraft and declining revenues on the horizon can they really afford too? maybe depends if the biggest s/h has there arm twisted behing there back a,whispering in there ear The arm will be twisted to breaking point and it will be a shout rather than a whisper.

[Master98]

http://www.afr.com/street-talk/buyback-or-special-dividend-for-air-new-zealand-20160613-gpicqz

I can't access this site seems talking about buyback or special dividen

[sb9]

The arm will be twisted to breaking point and it will be a shout rather than a whisper.

I'm picking there'll be a sweetener in form of special divvy especially after they coped big time last year from analysts/brokers for not declaring one on back of big profit. Big question is how much would that likely to be???

[sb9]

http://www.afr.com/street-talk/buyback-or-special-dividend-for-air-new-zealand-20160613-gpicqz

I can't access this site seems talking about buyback or special dividen

Here it is: (Sorry some of the stuff didn't come across properly)

""

by
Sarah Thompson (http://www.afr.com/street-talk/sarah-thompson-j7ger.html)
Anthony Macdonald (http://www.afr.com/street-talk/anthony-macdonald-j7gcx.html)
Joyce Moullakis (http://www.afr.com/street-talk/joyce-moullakis-j7gdc.html)

Air New Zealand could increase earnings per share by 10 per cent if it uses its cash windfall to buyback shares.
That's the view of Macquarie analysts, who ran the numbers on a buyback following Air NZ's sale of a 19.98 per cent stake in Virgin Australia (http://www.afr.com/business/transport/aviation/chinas-nanshan-group-to-buy-virgin-australia-stake-from-air-new-zealand-20160609-gpfw5q).
"The key question will be around the state of the balance sheet, with gearing ~50% for the next few years," Macquarie told clients on Tuesday morning.
"However we note that AIR has effectively banked capex (~3 years) with an average fleet at ~6.2 years by FY19 (global average today = 9.9 years).

"AIR believes that maintenance capex is around $250m p.a. vs. the ~$1b of capex they are spending at present to improve the fleet, meaning significant free cash flow would be available following this investment period to reduce gearing and provide flexibility for change in operating environment."
UBS analysts reckon Air NZ should use a 25¢ a share special dividend to return the proceeds.
UBS told clients that the special dividend should happen before the end of August, following Virgin's capital structure review, which would also see Air NZ's $131 million loan to the Australian airline repaid.
"After both events we believe AIR will most likely return net proceeds from the VAH shareholding sale to its shareholders via special dividend," the analysts told clients.

"While exact timing is difficult to judge, we expect this to occur before the end of August."

[Master98]

I'm picking there'll be a sweetener in form of special divvy especially after they coped big time last year from analysts/brokers for not declaring one on back of big profit. Big question is how much would that likely to be???
I pick 10c special plus 15c final.

[sb9]

I pick 10c special plus 15c final.

I would say that would be a safe bet in my opinion too...

[Master98]

Here it is: (Sorry some of the stuff didn't come across properly)

""

by
Sarah Thompson (http://www.afr.com/street-talk/sarah-thompson-j7ger.html)
Anthony Macdonald (http://www.afr.com/street-talk/anthony-macdonald-j7gcx.html)
Joyce Moullakis (http://www.afr.com/street-talk/joyce-moullakis-j7gdc.html)

Air New Zealand could increase earnings per share by 10 per cent if it uses its cash windfall to buyback shares.
That's the view of Macquarie analysts, who ran the numbers on a buyback following Air NZ's sale of a 19.98 per cent stake in Virgin Australia (http://www.afr.com/business/transport/aviation/chinas-nanshan-group-to-buy-virgin-australia-stake-from-air-new-zealand-20160609-gpfw5q).
"The key question will be around the state of the balance sheet, with gearing ~50% for the next few years," Macquarie told clients on Tuesday morning.
"However we note that AIR has effectively banked capex (~3 years) with an average fleet at ~6.2 years by FY19 (global average today = 9.9 years).

"AIR believes that maintenance capex is around $250m p.a. vs. the ~$1b of capex they are spending at present to improve the fleet, meaning significant free cash flow would be available following this investment period to reduce gearing and provide flexibility for change in operating environment."
UBS analysts reckon Air NZ should use a 25¢ a share special dividend to return the proceeds.
UBS told clients that the special dividend should happen before the end of August, following Virgin's capital structure review, which would also see Air NZ's $131 million loan to the Australian airline repaid.
"After both events we believe AIR will most likely return net proceeds from the VAH shareholding sale to its shareholders via special dividend," the analysts told clients.

"While exact timing is difficult to judge, we expect this to occur before the end of August."
thanks sb9

[bull....]

Big support at 210 currently, see if that holds first.

interesting all the buyers there I have it broken support at 2.13 so they look likely to get filled I guessing on the way to 2.05

[Beagle]

Here it is: (Sorry some of the stuff didn't come across properly)

""

by
Sarah Thompson (http://www.afr.com/street-talk/sarah-thompson-j7ger.html)
Anthony Macdonald (http://www.afr.com/street-talk/anthony-macdonald-j7gcx.html)
Joyce Moullakis (http://www.afr.com/street-talk/joyce-moullakis-j7gdc.html)

Air New Zealand could increase earnings per share by 10 per cent if it uses its cash windfall to buyback shares.
That's the view of Macquarie analysts, who ran the numbers on a buyback following Air NZ's sale of a 19.98 per cent stake in Virgin Australia (http://www.afr.com/business/transport/aviation/chinas-nanshan-group-to-buy-virgin-australia-stake-from-air-new-zealand-20160609-gpfw5q).
"The key question will be around the state of the balance sheet, with gearing ~50% for the next few years," Macquarie told clients on Tuesday morning.
"However we note that AIR has effectively banked capex (~3 years) with an average fleet at ~6.2 years by FY19 (global average today = 9.9 years).

"AIR believes that maintenance capex is around $250m p.a. vs. the ~$1b of capex they are spending at present to improve the fleet, meaning significant free cash flow would be available following this investment period to reduce gearing and provide flexibility for change in operating environment."
UBS analysts reckon Air NZ should use a 25¢ a share special dividend to return the proceeds.
UBS told clients that the special dividend should happen before the end of August, following Virgin's capital structure review, which would also see Air NZ's $131 million loan to the Australian airline repaid.
"After both events we believe AIR will most likely return net proceeds from the VAH shareholding sale to its shareholders via special dividend," the analysts told clients.

"While exact timing is difficult to judge, we expect this to occur before the end of August."

We are well positioned...shame about the SP.

[sb9]

We are well positioned...shame about the SP.

Hence the saying "markets can be irrational"...

[Drummer]

I pick 10c special plus 15c final.

Thinking about dipping my toe into the share market, so on a steep learning curve.... could someone clear this up for me : if I have 5000 shares with a 25c per share dividend the pay out is (5000 * .25) = $1250 ? Is this correct?

[ohpark0119]

Thinking about dipping my toe into the share market, so on a steep learning curve.... could someone clear this up for me : if I have 5000 shares with a 25c per share dividend the pay out is (5000 * .25) = $1250 ? Is this correct?

before tax

[bull....]

Thinking about dipping my toe into the share market, so on a steep learning curve.... could someone clear this up for me : if I have 5000 shares with a 25c per share dividend the pay out is (5000 * .25) = $1250 ? Is this correct?

looks right, goona dip ya toes in a on pure speculation a your fit right in lol

[thestg]

Thinking about dipping my toe into the share market, so on a steep learning curve.... could someone clear this up for me : if I have 5000 shares with a 25c per share dividend the pay out is (5000 * .25) = $1250 ? Is this correct?

Yes plus there is the tax credit. But the day the share goes Ex-Dividend the share price opens 25 cents less than the previous close.

[Longhaul]

Thinking about dipping my toe into the share market, so on a steep learning curve.... could someone clear this up for me : if I have 5000 shares with a 25c per share dividend the pay out is (5000 * .25) = $1250 ? Is this correct?

Speaking from my own experience in more general terms (not just in relation to AIR), a little knowledge is a dangerous thing. Be careful out there.

[ohpark0119]

Yes plus there is the tax credit. But the day the share goes Ex-Dividend the share price opens 25 cents less than the previous close.


everyone here would love to see the SP staying same or go higher after ex-div declared lol

[sb9]

interesting all the buyers there I have it broken support at 2.13 so they look likely to get filled I guessing on the way to 2.05

Bidders right on 210 as I type, will be an interesting finish for the day and next few days trading as well...

[Gizzajob I can do that]

Thinking about dipping my toe into the share market, so on a steep learning curve.... could someone clear this up for me : if I have 5000 shares with a 25c per share dividend the pay out is (5000 * .25) = $1250 ? Is this correct?

The only problem with this theory is that you will likely lose x amount before you gain x amount, be carefull

[Mista_Trix]

Thinking about dipping my toe into the share market, so on a steep learning curve.... could someone clear this up for me : if I have 5000 shares with a 25c per share dividend the pay out is (5000 * .25) = $1250 ? Is this correct?

If you're going to roll the dice (which is really what it is at this point). Can I recommend you break your 5,000 up into chunks to help soften if you get your timing wrong (which is likely given your inexperience - I'm not being mean, just honest).

Why not buy $3,330 worth when it looks like it hits the bottom here. That way you've got more 'if' it breaks $2.02 and goes down to ~$1.80, otherwise you'll put all your money in, and if it goes lower, you'll feel like you did bad and likely pull it all out anyways, or, do what most of these guys have done and throw good money after bad.

If you're going to dice roll, maybe do it in three phases. e.g. ~$3,330 parcels each time, you're only paying 1% fee, and if what you think will happen is correct, then you will make that part back in divs. It'll help soften the possibility of bad timing...
...I'm not advising you do or don't invest, just have a planned approach to doing so.

[Snow Leopard]

The arm will be twisted to breaking point and it will be a shout rather than a whisper.

The mental picture of John Key pinning Chris Luxon to the wall whilst Bill English empties his pockets is an amusing one.

Best Wishes
Paper Tiger

[Drummer]

Yes plus there is the tax credit. But the day the share goes Ex-Dividend the share price opens 25 cents less than the previous close.

Really.... I'll need to work out how that works, if share prices move by people offering to buy and others offering to sell at a price, why would it open 25c less Ex-Div date.

[stoploss]

Really.... I'll need to work out how that works, if share prices move by people offering to buy and others offering to sell at a price, why would it open 25c less Ex-Div date.

Drummer you will find a lot of people happy to sell to you at the previous days close or 5 cents under , if it has gone ex a 25 cent dividend , how many you keen to buy :)

[Drummer]

Speaking from my own experience in more general terms (not just in relation to AIR), a little knowledge is a dangerous thing. Be careful out there.

Totally agree.... could be an interesting hobby as long as I keep stupidity out of the mix.

[Drummer]

If you're going to roll the dice (which is really what it is at this point). Can I recommend you break your 5,000 up into chunks to help soften if you get your timing wrong (which is likely given your inexperience - I'm not being mean, just honest).

Why not buy $3,330 worth when it looks like it hits the bottom here. That way you've got more 'if' it breaks $2.02 and goes down to ~$1.80, otherwise you'll put all your money in, and if it goes lower, you'll feel like you did bad and likely pull it all out anyways, or, do what most of these guys have done and throw good money after bad.

If you're going to dice roll, maybe do it in three phases. e.g. ~$3,330 parcels each time, you're only paying 1% fee, and if what you think will happen is correct, then you will make that part back in divs. It'll help soften the possibility of bad timing...
...I'm not advising you do or don't invest, just have a planned approach to doing so.

Sound advice thanks....

[Gizzajob I can do that]

Totally agree.... could be an interesting hobby as long as I keep stupidity out of the mix.
If you must have a winged stock then you could check out TGH, its alot less volatile !

[Drummer]

If you must have a winged stock then you could check out TGH, its alot less volatile !

Gizzajob (Boys from the Black stuff??) TGH.. not sure I'm plucky enough

[couta1]

Really.... I'll need to work out how that works, if share prices move by people offering to buy and others offering to sell at a price, why would it open 25c less Ex-Div date. The share price following the Ex date is totally unpredictable especially with a stock like Air, but it's most likely to drop by more and possibly significantly more than the value of the divvy. Although my middle name is not 'Careful' as I currently hold 160k of these pups, I would suggest you head over to planet Spark and park your money there instead.

[Drummer]

The share price following the Ex date is totally unpredictable especially with a stock like Air, but it's most likely to drop by more and possibly significantly more than the value of the divvy. Although my middle name is not 'Careful' as I currently hold 160k of these pups, I would suggest you head over to planet Spark and park your money there instead.

So the price does not magically just drop the exact amount the div was, people just cashing out for a quick buck..... 160K you see it as a long term roller coaster then? Spark mmmm nah.

[couta1]

So the price does not magically just drop the exact amount the div was, people just cashing out for a quick buck..... 160K you see it as a long term roller coaster then? Spark mmmm nah. In theory it should initially drop by the exact amount but in reality it's unknowable, yep she's a great rollercoaster whether your taking a short or long flight, Spark was an example of a less volatile stock but hey climb aboard the Aircoaster if you can stomach a wild ride and don't mind being chased by red arrows.

[Baa_Baa]

So the price does not magically just drop the exact amount the div was, people just cashing out for a quick buck..... 160K you see it as a long term roller coaster then? Spark mmmm nah.

With respect Drummer, take it to the Newbies thread, or maybe Investing Strategies thread, this is basic stuff and people are happy to help if you ask in the right forum. There are others here who have big things to consider like how badly they're getting gazumped or when will they be buying the bottom.

[Baa_Baa]

Close at $2.08 was followed by 185,100 trading at 2.09/2.10, 62k of those off market, so while some here are unloading, others are obviously buying. That's about 10% of the total volume today after hours (total is around average compared to recently). Could be a good battle from here and heading into the recent low at $2.02, might see some solid buyer support emerging again around here. A double bottom and buyer support would be a good sign for the chartists. Patience is agonising when it's happening in the now. Plenty of fingers on the triggers I suspect, either way.

[percy]

I am finding it a lot more enjoyable watching from the sidelines.
I wish all players well..

[couta1]

I am finding it a lot more enjoyable watching from the sidelines.
I wish all players well.. Those couple of spins you took on the Aircoaster enough for a while aye Percy.

[percy]

Those couple of spins you took on the Aircoaster enough for a while aye Percy.

Yes very much so.
I ended up thinking I did not have a clue what I was doing,and had been lucky,rather than investing sensibly.A total loss of conviction.
On Friday I decided to sell small cap Aussie shares I had "lost conviction" for,and added AIR to the list.
I think AIR is a bit like NZR,just too many variables for me to understand.

[dobby41]

Yes I think AIR is a bit like NZR,just too many variables for me to understand.

Only one variable really - people.
Reading this forum I see a lot of logic - reason why the stock should do x or y.
Unfortunately it seems there are a lot of people buying and selling the stock that don't have the same logic and haven't read this forum.
People, emotions and herds.

[winner69]

That correlation between that ^XAL index and AIR can't possibly continue today, can it?

Maybe just a perception thing and not really a correlation anyway.

Index down nearly 3% overnight for what's worth

[winner69]

Load of the proverbial that so called correlation anyway

Last 3 months XAL down a tad but AIR down 25%

Maybe XAL trying to catch up?

https://au.finance.yahoo.com/q/bc?t=3m&s=%5EXAL&l=on&z=l&q=l&c=AIR.NZ%2C+&ql=1

[percy]

Only one variable really - people.
Reading this forum I see a lot of logic - reason why the stock should do x or y.
Unfortunately it seems there are a lot of people buying and selling the stock that don't have the same logic and haven't read this forum.
People, emotions and herds.

No I think you misunderstood me.
I was meaning the affects of the price of oil,foreign exchange rates,capex spending on new aircraft,competition,terms of alliances,and the undwinding of the VAH shareholding.

[Biscuit]

No I think you misunderstood me.
I was meaning the affects of the price of oil,foreign exchange rates,capex spending on new aircraft,competition,terms of alliances,and the undwinding of the VAH shareholding.

Probably a share that is better understood by studying the woods rather than the trees.

[percy]

Probably a share that is better understood by studying the woods rather than the trees.

Spot on.!! ..lol.

[workingdad]

Well 244.000 shares traded with VWAP of 2.11. Its a better start than I expected but let's see if it holds

[Baa_Baa]

Load of the proverbial that so called correlation anyway

Last 3 months XAL down a tad but AIR down 25%

Maybe XAL trying to catch up?

https://au.finance.yahoo.com/q/bc?t=3m&s=%5EXAL&l=on&z=l&q=l&c=AIR.NZ%2C+&ql=1

You obfuscating the point, the correlation is not in terms of 'percentage' it is simply in terms of 'direction' (which is currently down) and $XAL is a leading indicator when there is correlation. You're right though, $XAL fell further overnight and broke down through medium term support, next supports at the Feb levels.

The reason $XAL has relevance is that large offshore holders of AIR are likely to also invest in other airlines (within the Airlines Index) and this influences decisions about portfolio weightings to the sector and in turn flows into buy/sell decisions on individual airline stocks.

[Beagle]

You obfuscating the point, the correlation is not in terms of 'percentage' it is simply in terms of 'direction' (which is currently down) and $XAL is a leading indicator when there is correlation. You're right though, $XAL fell further overnight and broke down through medium term support, next supports at the Feb levels.

The reason $XAL has relevance is that large offshore holders of AIR are likely to also invest in other airlines (within the Airlines Index) and this influences decisions about portfolio weightings to the sector and in turn flows into buy/sell decisions on individual airline stocks.

I think you make a good point but any good sheep might like to consider that many of the airlines that make up that index are trading at quite interesting multiples to NTA compared to AIR. Have a look at Delta and American Airlines for instance and you might get quite a big surprise. I might have mentioned once or twice before that AIR have bought back their own shares before in years gone by when they trade at a meaningful discount to NTA.

[skid]

I think we need to get ''Brexit'' out of the way before there will be any major traction--everyones a bit spooked atm

[sb9]

Air New Zealand to Participate in Virgin Rights Issue...

https://nzx.com/companies/AIR/announcements/284089

[Xerof]

yes, but the 'to the extent....' bits are of relevance

[Beagle]

http://www.asx.com.au/asxpdf/20160615/pdf/437x0yk1nv8twt.pdf

Interesting points. Issue at 21 cps is at a very serious discount to current SP and NTA which are basically in line with each other at 29-30 cps.
Issue amount is as much as I originally expected, I said many pages back that the amount of the shareholder loans circa $450m, they really needed to get double that amount in new capital to get back to a sensible debt equity ratio of about 2:1.
Shareholder loans to be repaid.
This issue doesn't exactly put their balance sheet into a truly robust position, 2:1 debt equity is obviously far weaker than 1:1 debt equity AIR enjoy and obviously AIR are currently highly profitable whereas VAH are struggling to break even.

Executive Summary: Subject to regulatory approval's I am glad AIR are out of this pup, glad the shareholder loans are being repaid and expect AIR to continue with their very modest shareholding of circa 2.5% as a way of maintaining their code sharing arrangements with VAH which that airline needs even more than AIR needs it, classic symbiotic relationship if ever there was one.

[workingdad]

http://www.asx.com.au/asxpdf/20160615/pdf/437x0yk1nv8twt.pdf

Interesting points. Issue at 21 cps is at a very serious discount to current SP and NTA which are basically in line with each other at 29-30 cps.
Issue amount is as much as I originally expected, I said many pages back that the amount of the shareholder loans circa $450m, they really needed to get double that amount in new capital to get back to a sensible debt equity ratio of about 2:1.
Shareholder loans to be repaid.
This issue doesn't exactly put their balance sheet into a truly robust position, 2:1 debt equity is obviously far weaker than 1:1 debt equity AIR enjoy and obviously AIR are currently highly profitable whereas VAH are struggling to break even.

Executive Summary: Subject to regulatory approval's I am glad AIR are out of this pup, glad the shareholder loans are being repaid and expect AIR to continue with their very modest shareholding of circa 2.5% as a way of maintaining their code sharing arrangements with VAH which that airline needs even more than AIR needs it, classic symbiotic relationship if ever there was one.

Looks like this VAH played out very well for AIR after all. Selling VAH for 33c AU and now buying 1 for 1 share at 21c, nice one and market sellers seem to be drying up a bit since announcements.

[bull....]

Looks like this VAH played out very well for AIR after all. Selling VAH for 33c AU and now buying 1 for 1 share at 21c, nice one and market sellers seem to be drying up a bit since announcements.

didn't play out for air well at all they lost 100s millions

[winner69]

You obfuscating the point, the correlation is not in terms of 'percentage' it is simply in terms of 'direction' (which is currently down) and $XAL is a leading indicator when there is correlation. You're right though, $XAL fell further overnight and broke down through medium term support, next supports at the Feb levels.

The reason $XAL has relevance is that large offshore holders of AIR are likely to also invest in other airlines (within the Airlines Index) and this influences decisions about portfolio weightings to the sector and in turn flows into buy/sell decisions on individual airline stocks.

Sorry to obfuscating there baabaa

Run some numbers over XAL and AIR - daily changes in each over the last 12 months

Conclusion - there is little correlation between the two (0.12) and that other factors (not how XAL is doing) mainly drive the AIR share price

Note your comment re 'direction' but i think that only applies over longer time periods

[workingdad]

I think yu should be buying heaps of AIR after that windfall

selling something for more than it's worth, avoiding getting stuck throwing in considerably more money than would otherwise have been the case is better than the alternative

[Gizzajob I can do that]

selling something for more than it's worth, avoiding getting stuck throwing in considerably more money than would otherwise have been the case is better than the alternative

Hasnt gone down well with VAH holders down 10% today

[winner69]

AIR must be glad they are getting out of Virgin

This the grand plan - raise $800m odd capital and "embark on a cost saving program that will see the airline reduce the number of its smaller capacity aircraft and “efficiencies” in maintenance and engineering roles, will see Virgin incur restructuring costs of as much as $250m along with non-cash balance sheet impairments of as much as $200m over the period to 30 June 2019."

[Snow Leopard]

For those of you confused about the recent Virgin/Air New Zealand/Nanshan proceedings I thought I would provide this clarifying graphic:

http://assets.amuniversal.com/0cef85b0de75013350c6005056a9545d

Best Wishes
Paper Tiger

[Xerof]

Looks like this VAH played out very well for AIR after all. Selling VAH for 33c AU and now buying 1 for 1 share at 21c, nice one and market sellers seem to be drying up a bit since announcements.

Not quite as it looks - I mentioned the relevance of 'to the extent....' sentence in the announcement.

AIR only take up the rights on the shares they have agreed to sell to Nanshan, if settlement of that sale hasn't occurred by the time the right offer closes. If they are required to do this, Nanshan have agreed to take them off AIR's hands via a sub-underwriting agreement (between AIR and NAN) in the fullness of time

[Beagle]

didn't play out for air well at all they lost 100s millions

I'd like to see your maths on that. I made a call on this a page or two back and welcome your detailed rebuttal of same. $50m write down in prior year and approx. another $50m to come, hardly the hundreds of millions you're claiming. What's clear is that if they hadn't of sold they'd be on the hook for hundreds of millions more share capital to be injected into a loss making company.
The much lesser of two evils has prevailed here.

[Master98]

American Airlines CEO claims the industry has permanently solved its biggest problemAmerican, Delta, and United have all recently reported record profits after decades of struggle.Last year, American Airlines saw its profits (http://www.businessinsider.com/american-airlines-earnings-2016-1) surge 50% to $6.3 billion.
According to Skift's Brian Sumers (https://skift.com/2016/06/14/american-airlines-ceo-says-industry-may-never-again-lose-money/), one major airline CEO believes the industry has solved its profitability problem for good.
"My personal view is that you won’t see losses in the industry at all," American Airlines CEO Doug Parker said at the airline's annual meeting last week. "We have gotten to the point where we like other businesses will have good years and bad years, but the bad years will not be cataclysmic. They will just be less good than the good years."
Although revenue growth across the board slowed down in the first quarter of the year, the airline industry is still going strong.
Even though Parker, as noted by Sumers, has long been an optimist in the strength of the airline business, his optimism is not unwarranted.
The airline industry has traditionally been a very volatile business with thin margins and high capital requirements. That's means the room for error is very narrow. As a result, in decades past, airlines have often teetered near bankruptcy.
Over the past few years, there's been a fundamental change in the way major US airlines are run. After the latest round of bankruptcies and consolidation that saw American merge with US Airways, Delta with Northwest, and United with Continental, it seems airline management has become more focused and efficient.
Airlines have been careful to exercises discipline in expanding capacity and routes. They have also keyed in on the areas that deserve the most investment and what customers can do without.
Although cheap crude prices over the past 24 months have certainly boosted airlines' financial performance, it would be unfair to attribute it solely to lower fuel expenditures.
Last month at Delta's media day, CEO Ed Bastian noted that current oil prices are nearly identical to that in 2005. That year, both Delta and future merger partner Northwest filed for bankruptcy. In 2015, Delta reported $4.5 billion profits (http://www.businessinsider.com/delta-shares-jump-after-earnings-report-2016-1) while returning $1.5 billion in profit-sharing (http://www.businessinsider.com/delta-air-lines-is-giving-its-employees-a-15-billion-reward-2016-2) to employees.

[Snow Leopard]

I'd like to see your maths on that. I made a call on this a page or two back and welcome your detailed rebuttal of same. $50m write down in prior year and approx. another $50m to come, hardly the hundreds of millions you're claiming.

At 30-Jun-2015 Air New Zealand carried there stake in VAH at NZ$360 having 'lost' NZ$124 on their cumulative investments of NZ$484 (I may have been a bit sloppy, and ignored a few million in transaction costs here :blush:).

If we assume that the entire holding sells for AU$301.3 (ie at 33cps) which is today about NZ$317 then that is a further NZ$43 loss (and ignores any transaction costs etc).

Thus there would be total losses of NZ$167. The actual final bill will obviously be a little different.

Valuing the 'unsold 2.5%' bit at current market price gives a current total loss of NZ$175.

All original numbers sourced from Air New Zealand Financial Statements, Air New Zealand Statements and the ASX.


What's clear is that if they hadn't of sold they'd be on the hook for hundreds of millions more share capital to be injected into a loss making company.
The much lesser of two evils has prevailed here.

Taking part in the capital raising is not compulsory.

Best Wishes
Paper Tiger

[couta1]

Another good month of operating stats.

[Beagle]

Another good month of operating stats.

Agree with you mate, good sound stat's there.

[workingdad]

Not quite as it looks - I mentioned the relevance of 'to the extent....' sentence in the announcement.

AIR only take up the rights on the shares they have agreed to sell to Nanshan, if settlement of that sale hasn't occurred by the time the right offer closes. If they are required to do this, Nanshan have agreed to take them off AIR's hands via a sub-underwriting agreement (between AIR and NAN) in the fullness of time

Good morning Xerof, I thought it was 'to the extent that AIR is a shareholder" which I interpret as the entire holdings not just limited to the Nanshan percentage. Either way its good news.

[workingdad]

Another good month of operating stats.

Yep, pretty happy with that alright - very good across the board really. Wonder if it translates to a green day for AIR today.....

[Longhaul]

Agree with you mate, good sound stat's there.

What does this mean exactly?

"Removing the impact of foreign exchange, Group-wide yields were down 5.5%."

[winner69]

Yep, pretty happy with that alright - very good across the board really. Wonder if it translates to a green day for AIR today.....

Reasonable stats but growth in RPKs declining and mickey will have noticed that the year to date yield is now nearly 2% down on last - a number that is getting bigger as each month passes

[sharp]

Reasonable stats but growth in RPKs declining and mickey will have noticed that the year to date yield is now nearly 2% down on last - a number that is getting bigger as each month passes

How abstract to consider just the yield. Have you considered the increasing capacity?

More seats and passengers but also more empty seats?

[winner69]

What does this mean exactly?

"Removing the impact of foreign exchange, Group-wide yields were down 5.5%."

So as nzd strengthens not too good for next year?

[Master98]

Reasonable stats but growth in RPKs declining and mickey will have noticed that the year to date yield is now nearly 2% down on last - a number that is getting bigger as each month passes
not surprise here as everyone know because tough competition, still very solid.

[winner69]

How abstract to consider just the yield. Have you considered the increasing capacity?

More seats and passengers but also more empty seats?

I didn't just mention yields - i mentioned RPK growth (paying passengers) as well

Both the declining growth and yields seem consistent with with what analysts think will be happening next year on the revenues front. Combined suggests F17 revenues might only be up 4% odd - compared to 8% plus growth this year

[workingdad]

Reasonable stats but growth in RPKs declining and mickey will have noticed that the year to date yield is now nearly 2% down on last - a number that is getting bigger as each month passes

Yes but this has been factored in hence a SP of 2.15 versus 3.05, looking at the detail with the added routes RPK's and load factors are pretty decent. I am not expecting continued growth with increased competition but it would seem they are not yet needing to discount substantially to keep load factors up. I have been considering a family holiday and took the same one 2 years ago, comparing prices and keeping an eye on them they are still higher now than then.

I still have a lot to learn but from my perspective I think this months stats are better than expected. Certainly appreciate the input from those like yourself that have a better understanding of things.

[Beagle]

What does this mean exactly?

"Removing the impact of foreign exchange, Group-wide yields were down 5.5%."

$Kiwi has averaged a lower rate than the previous year and this has boosted revenue in $Kiwi terms. If it weren't for that yields would be down 5.5%. This statement needs to be viewed in the context of where fuel prices are and what's happening to yields on an international basis which is the basis behind my comment that these stat's are sound.

[crighton100]

I think one should forget the stats for a minute & look at the facts [from a travelers perspective],most oldies like us travel quite a bit,but since the introduction of bag only flights,we went from AIRNZ passengers to who ever was cheaper.Now we have china,qantas,american & several other airlines coming in & offering full service for what air NZ are offering for a bag.Thats all very well when things are really bouyant,but I do think the s will hit the fan very shortly & with the fuel prices going up & our $$ going up again,I think they are going to find things pretty tough [& I am a shareholder].So things may not be as rosy as we would like to think.

[Beagle]

Naysayers have been saying that demand is about to fall off the edge of a cliff for quite a few months now...and yet the monthly operating stat's just keep on keeping on saying otherwise...
GDP growth stronger than anyone expected too, and tourism just keeps going gangbusters. Maybe all the gloom and doom is a little bit overdone...

[workingdad]

Past midday and only 121 thousand shares traded.
Perhaps read into that and the trading range this week starting to show some stability. Considering the markets in general.

[iceman]

Kiwi Regional closing down at the end of July. Ewan didn't last long this time either

[dobby41]

Kiwi Regional closing down at the end of July. Ewan didn't last long this time either

Good try though
Seems like a tidy exit.

[Beagle]

Kiwi Regional closing down at the end of July. Ewan didn't last long this time either

Can't help wondering how many poor people's lives he has wrecked this time. Might be a reasonable transition of sorts but you can bet you last dollar some people took a serious haircut here and bet your second to last dollar it wasn't Mr Wilson. http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11658391

[Regi]

Naysayers have been saying that demand is about to fall off the edge of a cliff for quite a few months now...and yet the monthly operating stat's just keep on keeping on saying otherwise...
GDP growth stronger than anyone expected too, and tourism just keeps going gangbusters. Maybe all the gloom and doom is a little bit overdone...

In his defence, I think perhaps the optimism is also "a little bit overdone".

Haven't checked this forum much lately but I'm reading much of the same false hope statements that were being said when it was all rosy past $3 and now with a third of its value wiped, literally the same statements are being flung around. Naive traders like myself at the beginning are often caught with such hype and I lost a bit here and there on AIR but I learnt from my mistakes, increased my holding at certain lows and sold at $3.03 just before the decline. Ended up doing quite well but AIR definitely taught me the meaning of "DYOR".

I'd just like to tell newcomers who might read this not to get caught with hype and perhaps look further into the track record of certain posters before basing decisions on their contributions.

Furthermore, in Rogers defence... I've seen he's caught a bit of flack over the month as if he was the one that guided the share price and therefore had some explaining to do for its decline. So long as you understand and abide by "DYOR", you should acknowledge Roger for his wealth of knowledge and passion he provides which may assist you in your investment decisions or queries but should not solely guide you and then be where you come to lay fault.

Disc. No longer hold but following closely.

[workingdad]

Past midday and only 121 thousand shares traded.
Perhaps read into that and the trading range this week starting to show some stability. Considering the markets in general.

Or not..... had some buys in at 2.07 that just got triggered - hadn't expected that but lets see what next week brings.

[couta1]

Or not..... had some buys in at 2.07 that just got triggered - hadn't expected that but lets see what next week brings. Big shutdown on a lot of stocks at close, people derisking for the weekend.

[blockhead]

Big shutdown on a lot of stocks at close, people derisking for the weekend.

You are right, SPK took a whump right at close there as well.

Whats so special about this weekend ??? All Blacks should win,what else is there to worry about ?

[workingdad]

You are right, SPK took a whump right at close there as well.

Whats so special about this weekend ??? All Blacks should win,what else is there to worry about ?

Lots of big trades - some pushed prices up as much as some went down.... big money tweaking portfolios?

[couta1]

You are right, SPK took a whump right at close there as well.

Whats so special about this weekend ??? All Blacks should win,what else is there to worry about ? Nothing special other than the Brexit decision next week weighing on the minds of some, for those long on Air we only have to worry about the size of the next divvy because turbulence is the norm with this stock.

[blockhead]

Nothing special other than the Brexit decision next week weighing on the minds of some, for those long on Air we only have to worry about the size of the next divvy because turbulence is the norm with this stock.

Perhaps you are right Couta but Brexit existed at the start of the day, why suddenly get the wind up right at the end of the day ??

[couta1]

Perhaps you are right Couta but Brexit existed at the start of the day, why suddenly get the wind up right at the end of the day ?? The Big boys normally play their cards at closing time, always reminds me how insignificant us minnows are in the market dynamics.

[Fox]

Perhaps you are right Couta but Brexit existed at the start of the day, why suddenly get the wind up right at the end of the day ??

As Couta said earlier, most likely people holding off until nearer the end of the day to get a better price or trade larger blocks. They all probably wanted out before the weekend to reduce their risk and ease up on the blood pressure medication.

[percy]

I am sure it was a Welsh fund manager packing his bags and leaving the NZ market..lol.

[Joshuatree]

In his defence, I think perhaps the optimism is also "a little bit overdone".

Haven't checked this forum much lately but I'm reading much of the same false hope statements that were being said when it was all rosy past $3 and now with a third of its value wiped, literally the same statements are being flung around. Naive traders like myself at the beginning are often caught with such hype and I lost a bit here and there on AIR but I learnt from my mistakes, increased my holding at certain lows and sold at $3.03 just before the decline. Ended up doing quite well but AIR definitely taught me the meaning of "DYOR".

I'd just like to tell newcomers who might read this not to get caught with hype and perhaps look further into the track record of certain posters before basing decisions on their contributions.

Furthermore, in Rogers defence... I've seen he's caught a bit of flack over the month as if he was the one that guided the share price and therefore had some explaining to do for its decline. So long as you understand and abide by "DYOR", you should acknowledge Roger for his wealth of knowledge and passion he provides which may assist you in your investment decisions or queries but should not solely guide you and then be where you come to lay fault.

Disc. No longer hold but following closely.

Great post Regi; iused to worry about you as a "newbie" but see i don't have to anymore ; congrats on your learning from mistakes; i still am:)

[Beagle]

Its been a shocking reality check, no way to sugar coat this thing. Who would have thought a couple of months ago that post a deal to sell most of VAH the shares would be close to $2.00 ?

If there's anyone left who's interested in what I'm doing with this bird it goes like this. Shares are now basically trading in line with NTA (unlike any of their peers I monitor apart from VAH, which let's be honest is a basket case even post the recapitalisation). I can't see any point selling at these level's (8% of my portfolio value) as I'm holding for long term dividend income but I acknowledge it could go under $2.00.

I think if the stock gets down to a 20-25% discount to NTA $1.50-$1.60 I might take a view that the SP will be supported by a buy-back and take a view that there could be an argument for a higher portfolio allocation but otherwise I will simply hold...i.e. I won't buy more unless there's a really decent sized discount to NTA. I hope / doubt it will go that low but who can say for sure ????

I doubt I will bother with my usual quarterly portfolio revaluation this quarter, can't see much point rubbing salt into the wound like that... Might get some Prozac with my next lot of blood pressure meds next week.

[couta1]

Forget the Prozac Roger, just buy that new boat and enjoy it, besides, 8% is a conservative allocation, so just hold em and collect the divvies, who knows what the price will be in a few months or this time next year.

[Raz]

Great post Regi; iused to worry about you as a "newbie" but see i don't have to anymore ; congrats on your learning from mistakes; i still am:)

Well said, sure a lot have been sucked into the hype and paid for it this time.

[couta1]

Well said, sure a lot have been sucked into the hype and paid for it this time. The real hype happened a few years ago with Xro/Peb/SNK/and Wyn (Lots of money lost on those stocks, speaking from experience of course) I don't see much hype on this thread just a few honest opinions on people's holdings coupled with a bit a frustration of the way things have played out, nothing wrong with that or with expressing hope by being positive.

[see weed]

Or not..... had some buys in at 2.07 that just got triggered - hadn't expected that but lets see what next week brings.
Ditto, had buy order in at 2.10 and was happy to see sellers build up to push price down. But in saying that, I also bought some at 2.125 earlier in the day. Happy to buy up more at these lower levels. Hoping it will not drop back to 4 year lows where I bought in last time. Just a bit of divy chasing here;).

[skid]

You are right, SPK took a whump right at close there as well.

Whats so special about this weekend ??? All Blacks should win,what else is there to worry about ?

Market watch (USA) ''No one wants to go into the weekend long''(because of Brexit)

Brexit is calling the shots atm----Good ole globalization--whether the UK leaves the European union determines how you airline shares in NZ do

S&P 500 posts biggest weekly drop since April (so depending how you look at it -thats good or bad news)--We appear to be in good company with the drop-but that dont help the share price.

So alot depends on what the folks in the UK decide---at least they get to decide---I cant help but think we would be ''dismissed'' as irrelevant by John Key in a similar situation here.

[skid]

The real hype happened a few years ago with Xro/Peb/SNK/and Wyn (Lots of money lost on those stocks, speaking from experience of course) I don't see much hype on this thread just a few honest opinions on people's holdings coupled with a bit a frustration of the way things have played out, nothing wrong with that or with expressing hope by being positive.

I think his point is directed more to ''newbies'' who might act on what is said

[cyclist]

I think his point is directed more to ''newbies'' who might act on what is said

I don't think anyone has been unreasonably trying to hype AIR over the past few months. The fundamentals did look solid even when considering known headwinds, and the arguments for and against seemed pretty balanced to me. I think that is couta1's point.

[Joshuatree]

Agree, past few months have been healthy; but not past few years.Lets keep it where it is; on a good path for all..

[workingdad]

Ditto, had buy order in at 2.10 and was happy to see sellers build up to push price down. But in saying that, I also bought some at 2.125 earlier in the day. Happy to buy up more at these lower levels. Hoping it will not drop back to 4 year lows where I bought in last time. Just a bit of divy chasing here;).

I am not convinced AIR is a good investment strategy with the added risk of extrinsic factors at the moment but I'm not expecting it will break the 2 dollar mark (famous last words - but I am not alone, plenty of buyers soaking up the low price). Watching it lately the behaviour of sellers appears to be more staunch in holding, a few jump in when it drops a couple of cents but not to the degree of earlier on. Take out the big chunk at closing and it looks to be steady in that 2.10 plus range and the last 3 weeks the chart shows it tracking sideways less dramatic swings than last month, 8 green days, 9 red. If we get a couple green days Monday and Tuesday I will feel a bit more comfortable but not holding my breath with what's going on re brexit although better trading Mondays than Fridays with those not wanting to get caught out going into the weekend.

It didn't drop below the 2.02 mark with the uncertainty of VAH and now that is looking better than anticipated one would think perhaps at this level the yield/divvys over the next few years will be worth it and factoring in the possible special for the VAH sale which I think will happen but that's just my opinion.

I am still learning but I think even though it is cyclical in nature the outlook isn't as bad as some think. Looking at operating stats, oil prices low in comparison to historical standards, tourism and competition I think they can carve out decent profits but I wont be holding at the expense of a falling SP.

But as the chartists know, its the behaviour of the market that rules over fundamentals. Juggling the two is proving to be a challenge and reading up on the more experienced on the forum some have dabbled with good effect and others have not.

I will hold some if its steady as she goes and also been playing with a couple of packets that have tight stops in place clawing back some of the losses of trying to catch the knife early on, this was also triggered yesterday at 2.13, end of the yesterday same number of shares, little bit more in the trading account. In saying that though, it is a gamble and the SP doesn't always go in the direction anticipated so there's been some stiff drinks required on occasion.

That's my summary, balanced, hopeful, considered and ballsy :cool: Really like some of the commentary of posters and the feedback of many.

[Zouga]

I must admit as a newbie I have bought into AIR in a small way at 2.66 then 2.23 and although I read the forums, and in particular the TA discussions, it's only by experiencing the fall and reading the response from others that I have really started to learn. I am watching this share with great interest and have appreciated all posts.

[workingdad]

Top five wish list destinations for British holidaymakershttp://www.nzherald.co.nz/travel/news/article.cfm?c_id=7&objectid=11658964

Brits top wish list destination for holidays....... good old NZ with 29% Iceland 20% Japan 19% Norway 16% Croatia 15%

Interesting that 38% of them rank going somewhere safe as a consideration.

Not exactly a reason to cause a dramatic increase in SP but its their core business and tourism is booming.

[Beagle]

The real hype happened a few years ago with Xro/Peb/SNK/and Wyn (Lots of money lost on those stocks, speaking from experience of course) I don't see much hype on this thread just a few honest opinions on people's holdings coupled with a bit a frustration of the way things have played out, nothing wrong with that or with expressing hope by being positive.

God's honest truth right there. Some of the hype that's been perpetrated about companies that have yet to make a single cent of profit has truly beggared belief at times. At least AIR make money and lots of it.

[axe]

God's honest truth right there. Some of the hype that's been perpetrated about companies that have yet to make a single cent of profit has truly beggared belief at times. At least AIR make money and lots of it.

There is some fear with AIR over the impact of some short term factors and those with short term investment horizons will need to pay heed to these factors - primarily increasing fuel prices and increasing competition. These factors are likely to reduce profits over the next 15-24 months

However those will a longer term investment horizon will be looking forward to the large increase in free cash flow that will come later on in the decade as the CAPEX from the fleet modernisation and simplification programme rolls off.

AIR will be left with one of the youngest and most fuel efficient fleets in the world granting competitive advantage against rising oil prices and a balance sheet to support increasing dividends.

DYOR.

[workingdad]

Interesting day for AIR, I sold half the 2.07 package I got from Friday this morning, put in another buy at 2.07 again at the same time and feeling quite happy with myself went out for a couple of hours, come home and what, 2.08 again..... well that's a surprise. Wasn't even a volume thing at the time either, pretty subdued all day.

Anyone think someone trying to rattle some holders loose looking for bargain or are we still just seeing more weakness despite limited selling volumes? 6 million dollar question right there. Certainly hope it finishes green today with the market bounce back in general.

[ohpark0119]

Interesting day for AIR, I sold half the 2.07 package I got from Friday this morning, put in another buy at 2.07 again at the same time and feeling quite happy with myself went out for a couple of hours, come home and what, 2.08 again..... well that's a surprise. Wasn't even a volume thing at the time either, pretty subdued all day.

Anyone think someone trying to rattle some holders loose looking for bargain or are we still just seeing more weakness despite limited selling volumes? 6 million dollar question right there. Certainly hope it finishes green today with the market bounce back in general.

What i found out is that it starts good in the morning and falls in afternoon... So sell in the morning

[Raz]

What i found out is that it starts good in the morning and falls in afternoon... So sell in the morning

not the volume today to make decent money

[ohpark0119]

not the volume today to make decent money

a noob question but what's considered high volume? 100k+??

[couta1]

Chairman Mr Carter buys 20k shares today at $2.13(Nice)

[workingdad]

What i found out is that it starts good in the morning and falls in afternoon... So sell in the morning

Not every day but yeah it seems that way a bit. Low volume today though, surprised to see it drop 5c with only 40,000 traded in that time frame

[Beagle]

There is some fear with AIR over the impact of some short term factors and those with short term investment horizons will need to pay heed to these factors - primarily increasing fuel prices and increasing competition. These factors are likely to reduce profits over the next 15-24 months

However those will a longer term investment horizon will be looking forward to the large increase in free cash flow that will come later on in the decade as the CAPEX from the fleet modernisation and simplification programme rolls off.

AIR will be left with one of the youngest and most fuel efficient fleets in the world granting competitive advantage against rising oil prices and a balance sheet to support increasing dividends.

DYOR.

Sums it up pretty well I reckon. The company will still be around in another 75 years long after you me and everyone else here is pushing up daisy's.
Should be a good sound dividend payer for the foreseeable future.

Much needed refreshing change to see a Director buying, albeit a modest amount. Another financial year almost done and dusted...I must be starting to get old...where do they go ? Atmosphere at this year's annual meeting will be interesting if SP stay's around the current level. Expecting a more sombre mood despite a record ever profit.

[kiwichick]

VAH sale complete: https://www.nzx.com/companies/AIR/announcements/284363

[Joshuatree]

But still holding 5.9%

[sharp]

But still holding 5.9%

This is pre VHA issuing new shares to HNA.

[workingdad]

VAH sale complete: https://www.nzx.com/companies/AIR/announcements/284363

I look forward to a special divy announcement 😜

[sb9]

I look forward to a special divy announcement 

Will have to wait until end of August when results are announced...

[Beagle]

Good rid dens. Looking forward to them selling the rest of that pup. Great news too that the recapitalisation of VAH is proceeding and AIR's shareholder loan will be repaid soon. That's a big percentage of the mess now confirmed to be cleaned up. Well done to the current management team on cleaning up Rob Fyfe's mess.

[Marilyn Munroe]

It will be interesting to see if Cullen Airlines and Virgin(Under Arm Bowlers division) can overcome their corporate rancor to continue ripping off travellers through their code share agreement accross the ditch.

Though this dude reckons the Under Arm Bowlers are going to field their second eleven team Tiger;

https://blogs.crikey.com.au/planetalking/2016/06/15/virgin-australia-gives-pointers-future/

Boop boop de do
Marilyn

[mikeybycrikey]

But still holding 5.9%

Interesting to see that this sale of 19.98% is before the share issue to HNA. This leaves them with 5.9%, which I assume will decrease to 5.13% at some point in the future.

I had assumed that the sale was after the share issue (and I think a few others here did too), which would've left them with 2.5%.

Makes quite a big difference (although both 2.5% and 5.1% are significantly less than 25.9%).

[ohpark0119]

does anyone have DRIP set up? Do I select full/partial participation and additional shares are automatically given to me?

[Beagle]

http://australianaviation.com.au/2016/06/sp-says-virgin-852mln-capital-raising-should-cover-airlines-near-term-funding-requirements/

As I posted the other day, the capital raise doesn't exactly put them in a robust position.

[mikeybycrikey]

does anyone have DRIP set up? Do I select full/partial participation and additional shares are automatically given to me?

I thought there was no DRP but a search on the internet shows up a dividend policy with reference to re-investment. Also on the Link website, it seems I can set up reinvestment. So maybe there is a re-investment policy. Have a look here http://www.airnewzealand.co.nz/dividend-history and here http://www.airnewzealand.co.nz/assets/PDFs/2008-dec-dividend-policy.pdf. Policy is from 2008 but I can't find any evidence that it has changed.

Also, in response to your earlier question about volume, in absence of other sources, I find yahoo has decent info on volume, showing average volume (https://nz.finance.yahoo.com/q?s=air.nz&ql=1) and providing info on historical prices and volumes (https://nz.finance.yahoo.com/q/hp?s=AIR.NZ).