And if anybody wants to challenge a route, 1.3 Bil cash and lowish gearing allows for quite a dogfight...
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And if anybody wants to challenge a route, 1.3 Bil cash and lowish gearing allows for quite a dogfight...
Oh well never mind...a little birdie tells me AIR had a HUGE February and bookings for March / April are REALLY STRONG. :t_up::t_up:
Correct - but the total trip duration was only about 3 hrs longer and they are both quality airlines so no big deal. After I booked I realized I could have gone Cathay (one stop in HK) for under $3000 also.
Don't get me wrong I'm a happy AIR holder from the mid-$1's and think they have done a great job - probably the best run airline in the world and with a unique domestic monopoly franchise that has been challenged and defended successfully several times over the past 20yrs. But I do think on some routes profiteering will hurt their brand. It s a little like Cadbury making small changes that over time are defendable but erode your brand strength. For an airline pricing seen as "fair" is a key aspect of brand whether you are a low-cost carrier, national icon, or full service premium brand.
Agree with all of that Arbroath. Air NZ is a great airline and my preferred choice to travel with. But too often in the last 2-3 years do I find their long haul fares unjustifiably high against comparable full service competitors.
The NBR today suggesting AIR monopoly on direct routes between NZ-US may well come under pressure soon from AA.
I did a random search the other day on webjet and was quite surprised that AIR actually came up as one of the cheaper airlines to fly to London in May. (Was thinking about flying to London to organise a cheap supercharged F Type Jaguar but that's another story). Fares circa $2k return were on offer.
Anyway on another subject I had a quick look through the half year's financial report which arrived today and who knew under general disclosures 2(d) the company has renewed its on market buyback authority for a programme for up to 3% of the company's stock, up to 33m shares or $66m whichever is the lower in the year to 29 Sep 2015, (none done in the half year period and none to date otherwise it would have been announced to the market). When I get more time I'll have a thorough read and see what other little golden nuggets of information are contained therein.
That reminds me ; i remember fares to London in 1983 being re $23-$2400!! 32 years later its cheaper.:ohmy:
My leaving-out of the usual appeal for John Key to sell AirNZ to Etihad was an oversight on my part. Though you regard it as an irritating troll it is my genuine conviction.
As an investment savvy person you will be aware of the Greenspan Put. A belief the US Central Bank will not allow the "to big to fail" banks to go under. If they come under pressure the Central Bank will flood the market with liquidity allowing the tbtf banks to escape their folly.
The New Zealand taxpayer is in the gun under a similar arrangement, the Cullen Put. Tax payer’s money will be used to keep AirNZ’s head above water if it gets into serious trouble. This has happened before which is why I call it the Cullen Put.
Airlines are a tough game with frequent financial reverses. Aviation history is littered with the corpses of failed airlines. Anyone remember ANSETT? What if Virgin in the recent capacity war and cash burn had faced an opponent led by someone that actually knew what they are doing?
Taxpayers should not have the risk of paying large amounts of cash unexpectedly. What say we could off load-this burden to someone else. Who is already a partner with AirNZ in Virgin? Who is buying up airlines all over the place, even plunking down cash for that old has-been Alitalia?. Who is headquarted is a sand state with petro-dollars to throw around in uncertain ventures?
Memo to John Key: Sell AirNZ to Etihad.
Boop boop de do
Marilyn
Okay I'll take the bait and debate the political and national interest aspects of this.
1. I haven't got the time to review the 2001 recapitalisation in great detail but from a brief look there was a $885m package involved of which $300m was preference shares, since repaid. With the benifet of hindsight after repayment of preference shares their net investment was $585m.
2. For most of the last 14 years healthy level's of dividends have been paid to the government, e.g. last years final dividend, (just one of manyover the years, including the special translated into a $92m payment to the Govt) as well as the company paying full taxation to the N.Z. government every year.
3. The company presently employs approx. 10,500 Kiwi's and I worked out the average salary is $104,000, that's nearly $1.1 billion dollars in wages and the vast majority of those employees are N.Z. residents and liable for N.Z. taxation at an average rate of somewhere around 30 cents on the dollar that's $330m in PAYE remitted to the N.Z. Govt each and every year !!
4. Lets have a look at how the airline has performed over the years. According to Craigs the average return inclusive of dividends for the last 10 years has been 12% per annum compounding. Very, very few other stocks have double digit average 10 year returns. There's a little gold nugget of information I'll bet very few people realised, especially you. Despite being a cyclical industry and the last 10 year period encompassing arguably one of the most difficult periods in the companies 75 year history, (the global financial crisis), long term holders have enjoyed compound returns of 12% per annum !!
5. Notwithstanding the Government selling some of its stake down in November 2013 and getting most of its original investment back ($365m), the present value of the Govt's remaining 53% stake is a whopping $1.75 billion dollars !!!!!
6. Kiwi's enjoying domestic airfares that are ostensibly unchanged from what they were a decade ago i.e. in real inflation adjusted terms they're actually about 30% cheaper. God knows what domestic airfares would be if Etihad or some other foreign carrier dominated the market but you can bet you last dollar they wouldn't be as reasonable as they are now.
7. There's also the national interest to think about. Why would you put some other foreign governments national interests ahead of our own by selling to some other foreign owned airline who would run the airline purely in their own national interests ? Governments owning some / all of their national airline is not a new concept by any means and many governments understand the importance of protecting their own national interest...why is this concept so difficult for you to understand ?
Even leaving aside the national interest debate I believe I've shown most emphatically that the N.Z. Govt has done exceptionally well out of its investment in AIR as have other shareholders and employees who are generally very well paid. I'd call that a win all round for all Kiwi's.
add in the fact AIR promotes New Zealand as destination that helps fuel tourism, hospitality etc.
A foreign airline wouldn't do the same level of promotion AIR does.
I see AIR as a worldwide ambassador for NZ.inc in some ways. The journey starts and finishes with them for most tourists.
Well said mate.
http://www.nzherald.co.nz/business/n...ectid=11412780 Fair enough in my opinion. The vast majority of customers opted out anyway. Rumour has it there aren't that many lawyers who didn't realise you needed to opt out :) (Recall that the complainant was a lawyer who made multiple bookings and incurred costs without realising he needed to opt out...this from a professional who's in the business of dotting I's and crossing T's...go figure? )
Almost sold AIR today, it's had a great run, needed the cash. Sold WYN and TME instead, but even at these lofty levels I think AIR has upside potential for FA reasons, but the pace of gains will slow down before the cycle reverses. If it was just TA, then it would be gone .. declining volume on a rising sp is a great signal for consolidation (exit) and at least a retest of 2.68 in due course.
jmho, BAA