AIR - Air NZ.

[Beagle]

Possible, sure, provided the unions are reasonable. When does that new normal arrive whatever it looks like ?
How much cash do they burn between now and then ? I reckon they're burning at least $300m a month in the lockdown. Sure that will slowly start to ease when people start travelling again in reasonable volume sometime maybe mid 2021. Lot of months of massive cash burn between now and then mate.
$900m is just the first tranche of support in my opinion.

There's more chance of a chimpanzee piloting the next space shuttle to the moon than AIR getting through this without heaps more support.

[BlackPeter]

Possible, sure, provided the unions are reasonable. When does that new normal arrive whatever it looks like ?
How much cash do they burn between now and then ? I reckon they're burning at least $300m a month in the lockdown. Sure that will slowly start to ease when people start travelling again in reasonable volume sometime maybe mid 2021. Lot of months of massive cash burn between now and then mate.
$900m is just the first tranche of support as clearly barked about already.

There's more chance of a chimpanzee piloting the next space shuttle to the moon than AIR getting through this without heaps more support.

Absolutely - it all can turn to custard, and unions are (particular under a left leaning government) rarely known for being reasonable. Why milk a cow if you could butcher it as well?

I am just pointing out that some more positive developments might be possible - whether they do happen depends on lots of things.

But hey - life would be sad (and not very successful) if we always just plan for the worst case - wouldn't it?

[Beagle]

Its possible to throw 12 with a pair of dice, I will grant you that. I am sure a smart chap like you knows the odds of that.

https://www.nzherald.co.nz/business/...ectid=12321706

[Traderwannabe]

Not sure if this is the best place to post but it is related to Air NZ. I managed to spend a few of my Airpoints today on the Mitre 10 online shopping website. They are selling a very limited selection of goods and you can pay using Airpoints. Just thought I would share.

[Arbroath]

[QUOTE=Beagle;804543]Possible, sure, provided the unions are reasonable. When does that new normal arrive whatever it looks like ?
How much cash do they burn between now and then ? I reckon they're burning at least $300m a month in the lockdown. Sure that will slowly start to ease when people start travelling again in reasonable volume sometime maybe mid 2021. Lot of months of massive cash burn between now and then mate.
$900m is just the first tranche of support in my opinion.

Beagle when they were operating a full domestic and international airline they were using $400m of cash a month. They will easily have this well below $300m by May. Although there is quite a bit of cost they can't eliminate there is also a lot they can. $300m is way too pessimistic to me, more like $200m (UBS estimate $207m). Don't get me wrong. I'm not saying its worth buying as it will very likely be recapitalised at a lower level by the Govt.
They need to maintain adequate liquidity, maybe $300-400m so my guess is draw on the Govt credit line by July at the latest...how much they end up drawing is the key here as to how much dilution is suffered by everyone thats not the Govt.

[Beagle]

Not sure if this is the best place to post but it is related to Air NZ. I managed to spend a few of my Airpoints today on the Mitre 10 online shopping website. They are selling a very limited selection of goods and you can pay using Airpoints. Just thought I would share.

Thank you. Just bought a couple of items to keep the family warm this winter. Might as well use these airpoints up. Still got more to burn though.

[Beagle]

[QUOTE=Arbroath;804592]

Beagle when they were operating a full domestic and international airline they were using $400m of cash a month. They will easily have this well below $300m by May. Although there is quite a bit of cost they can't eliminate there is also a lot they can. $300m is way too pessimistic to me, more like $200m (UBS estimate $207m). Don't get me wrong. I'm not saying its worth buying as it will very likely be recapitalised at a lower level by the Govt.
They need to maintain adequate liquidity, maybe $300-400m so my guess is draw on the Govt credit line by July at the latest...how much they end up drawing is the key here as to how much dilution is suffered by everyone thats not the Govt.

I need to update for Govt subsidy on wages of $585 per week, (which doesn't go far when the average employee earns over $2,000 per week).
Opex last year were $4,605m. Add rental and lease costs classified elsewhere of $245m and finance costs of $79m and you're close to $5 billion actual costs before additional non cash expense of depreciation of $567m, (which will be over $600m in FY20.

Cash operating expenses were $411m a month. If we strip out 30% of labour $405m, 99% of fuel $1,258m, add back approx. $250m for cost to exit fuel hedge, $1018m of other opex (50%) on a real quick back of the envelope, yes you might be right, once they have executed these savings (whenever that may be) they might get the monthly cash burn down to about UBS's estimate of $207m. I think their operational cash burn for April will be ~ $300m less Govt subsidy of $585 per week approx. $30m = $270m net and will slowly decline from there.

The issue with their cash reserves and cash burn is that in addition to the above many passengers may be entitled to cash refunds due to cancellations of services so how much of the (as at 31/12/2019) $1,380m in prepaid travel will they have to refund ?

[iceman]

Thank you. Just bought a couple of items to keep the family warm this winter. Might as well use these airpoints up. Still got more to burn though.

How does a JetStar customer get to use Airpoints ? By the way mate, your joke about "half way to Argentina" running out of fuel was not at all funny for someone stuck in Argentina for several months. But them's the breaks !!

[Beagle]

How does a JetStar customer get to use Airpoints ? By the way mate, your joke about "half way to Argentina" running out of fuel was not at all funny for someone stuck in Argentina for several months. But them's the breaks !!

Sorry mate, couldn't use the one way trip to a certain mountain starting with E.....would have been too insensitive but that was definitely the first one way trip that came to mind and a better analogy. Sorry to hear you are stuck over there.
I did fly Jethole last April one way. They were the last flight out of Wellington to come home from the SUM meeting and that gave me another hour drinking time with my mates. Just as well I had consumed a few as it dulled the pain from having my knees jammed in so hard to the seat in front. It should be illegal to have 29 inch pitch seats...breech of human rights.

[Ecks]

Crackup! Best thread to date!