AIR - Air NZ.

[Beagle]

Talked with the CFO of a local unlisted aviation company who do a lot of maintenance, aircraft and helicopter leasing. One of the biggest operators in Auckland, better not name them. Very, very tough times. Work has really dried up since Covid hit especially in the fixed wing division and for flight schools. Desperate times and many unpaid bills and qualified engineers sitting around picking their noses.

[Waltzing]

The stories you wont read much about.

Similar to harsh view from a women hamilton city sitting board member. First time in 2 years this person has dared to speak off record in private.

There appears to be little reporting the carnage out there in some private business sectors.

[Arbroath]

Foran says Air NZ capital raise to be “massive” and hopes it goes ahead after several delays.

This highlights a couple of points. AIR shareholders, other than the Govt, are likely to get hit between the eyes once the details are announced and secondly that the whole gig depends on the whim of the Finance Minister as the controlling shareholder.

It’s like waiting to watch a live train wreck!

[Jaa]

The cost and complexities of getting tested prior to international travel in NZ are now so high compared to other countries that Air NZ should develop their own testing facility at Auckland international airport with guaranteed turnaround times like most major international airports (SYD, SIN, LAX etc) have. Would be a major competitive advantage.

Just another way NZ has fallen far behind the rest of the world in managing this pandemic.

[Waltzing]

" live train wreck!"

crash landing wheels up.... could be some damage...

[Baa_Baa]

The cost and complexities of getting tested prior to international travel in NZ are now so high compared to other countries that Air NZ should develop their own testing facility at Auckland international airport with guaranteed turnaround times like most major international airports (SYD, SIN, LAX etc) have. Would be a major competitive advantage.

Just another way NZ has fallen far behind the rest of the world in managing this pandemic.

It's ridiculous, my son had to pay over $300 for the 'within 72 hours' departure test, which was more than it cost him to buy the one way flight to Melbourne. For a 19 year old off on his OE, that expense was gut wrenching, like for example it's three weeks shared rent in the hostel. Just for the test.

[Jaa]

It's ridiculous, my son had to pay over $300 for the 'within 72 hours' departure test, which was more than it cost him to buy the one way flight to Melbourne. For a 19 year old off on his OE, that expense was gut wrenching, like for example it's three weeks shared rent in the hostel. Just for the test.

Its outrageous.

Exact same PCR test is $NZ140 at Changi (under 24hr), $NZ188 at LAX (under 24hr) and $NZ85 at Sydney/Melbourne/Brisbane airports (90 mins).

[Dassets]

Foran says Air NZ capital raise to be “massive” and hopes it goes ahead after several delays.

This highlights a couple of points. AIR shareholders, other than the Govt, are likely to get hit between the eyes once the details are announced and secondly that the whole gig depends on the whim of the Finance Minister as the controlling shareholder.

It’s like waiting to watch a live train wreck!

A couple of times I have mentioned that a prospectus seems to be an issue for AIR in getting to a capital raise. Today there seems a little more focus on a debt capital raise also as part of that. Presumably that debt is government.

I did a quick refresh on the regs. I cannot understand how AIR can meet the requirements of a prospectus unless COVID relief can be granted but that has expired. Basically that COVID relief allowed issuers to tell investors nothing about any risks and really pull the wool over people's eyes. The past pulled capital raises for AIR are really the canary in the coal mine. I think the probability that an equity or public debt raise is diminishing at this time given the uncertainty with the business. As it stands the company must be looking at (large)losses for a indeterminate time.

This raises a few questions/issues/possibilities.

1. Restructuring. It is clear the business outlook has changed in away not envisaged in the first 6 months of the crisis. There is no return to how demand and the market operated prior. Long-haul is deeply affected in a more permanent way. Public comments now are focusing on short-haul targeting. For AIR that means a vastly shrunk network which means airfreight will remain a challenging logistics environment. AIR probably a considerable restructuring to shape the organisation to the new operating environment. A sizable "shrinking" across the organisation. That will need capital. I would like to know why Foran has ruled out any pure freight operation.

How big does a trans-tasman/pacific islands operation look like?

2. Nationalisation. The likelihood of this is increasing. Why? The financial market and general corporate rules framework governing AIR are becoming incompatible with its survival. Having minorities in there with legal protection is a problem. That said the rules on spending public money are there too but hey the penalties are nothing just some people may not vote for you with a bad report card from the auditor-general(and Labour already has a few).

At what level would this happen? Market?160? True value?50 cents? Midway?

Problem with market is more in the MoF's face. That is writing a monster cheque for minorities(plus pay a small $50m for the bond expiry) AND then own ongoing funding of losses plus never see the money already used which was meant to be paid back and now never will. This is probably a $5bil entry price. Fun times in the beehive.

Then you 100% own something where you have hundreds of people being paid more than a minister and quite a few more than PM including some walk around pilots. I would love to see that culture shift. Imagine both sides of the table eating endless dead rats.

3. Last thing. The banks and senior debt are still sitting there. So Govt will have its interests subordinated unless the banks allow some miracle on the Hudson type event. But that would screw their shareholders.......

Decisions, decisions anybody? Good luck with this steaming pile of turds.

[Beagle]

Greg Foran will try and make investment in the massive capital raise as sexy as possible, even has a new Maori term for his 5 year thrive plan. Kia Mau
https://www.nzherald.co.nz/business/...RCWHDEUUFR4WY/ Paywalled

Of course there are "no risks whatsoever" in making things look really sexy as this video clearly shows https://www.youtube.com/watch?v=KwxUdT0pMZc
Hands up all those who want to be on this "risk free" exciting ride...what could possibly go wrong, the Government are in charge

[Waltzing]

Will there be a Hui, kui, wuie...

lots of hungi's... free food, drinks, hula girls?

Big party? Masks not mandatory?

A Juan Trippe dance troupe out on the wings on the Black 777?

Not sure about being all in on this one...

Could create a whole new flying experience. Tourism to islands off the coast with flying boats..

Traditional fishing experiences show casing south pacific cultures..

It will kill them in europe to experience this new vista in south pacific Bali Hai sunsets...


https://www.youtube.com/watch?v=81NROmUb7o0