AIR - Air NZ.

[Jaa]

They better hurry before it becomes obvious that on top of the cash burn is another ~ $60m a month in depreciation as well as a prospect of another few hundred million to be written down on the 777-300's. Better conceal that till next year books after the capital raise eh Jaa

Good they announced their intentions clearly so that you and your sharsies mates can save your pennies up for the issue and can't say you were ambushed. Save up hard mate, I am sure it will be an "outstanding" investment opportunity

Back to depreciation sigh... it doesn't affect cash burn or when capital needs to be raised as its a backward looking measure. Share markets and investors/lenders are forward thinking. By February we could all be talking about who should get vaccinated first. Optionality and time are always valuable.

To your other point, what's wrong with increasing participation in the capital markets via Sharies, KiwiSaver or anywhere else? Great for capitalism, the markets and ultimately liberal democracies. The more people who have a solid stake in society the stronger that society will be. Stronger society is, the more resistant it is to external shocks like say a pandemic.

Oh and a quick look at our join dates shows I joined Sharetrader 2 years before you

[Beagle]

Back to depreciation sigh... it doesn't affect cash burn or when capital needs to be raised as its a backward looking measure.

Its going to add vast quantities of red ink to the losses they make and will burn away at the capital adequacy of the company. If all equity is expunged this year they have to raise capital as they're insolvent...which is exactly what they will be if they don't.

Share markets and investors/lenders are forward thinking.

Yes they are but nobody has any visibility about when widespread international passenger service flights can recommence or when there will be demand for same but many are predicting it won't be for several years so when they raise capital in early 2021 is that enough to see them through this crisis ? How long is a piece of string ?

By February we could all be talking about who should get vaccinated first

I think you've been listening to Donald Trumpet too much

Optionality and time are always valuable.

Not when you're burning $75m a month with no clear visibility on when the cash burn will stop.

To your other point, what's wrong with increasing participation in the capital markets via Sharies, KiwiSaver or anywhere else? Great for capitalism, the markets and ultimately liberal democracies. The more people who have a solid stake in society the stronger that society will be. Stronger society is, the more resistant it is to external shocks like say a pandemic.

Nothing wrong with Sharsies...I was just winding you up...the fishing was good today

Oh and a quick look at our join dates shows I joined Sharetrader 2 years before you

Wow, 610 posts in 12 years, I am overcome with gratitude for the regularity of your extremely insightful contributions

[Baa_Baa]

What some people seem to be missing is that AIR have failed before now, spectacularly failed which wiped out their retail investors.

AIR relies in these circumstances on their creditors. Their creditor of last resort is the government. The government won’t let the national airline fail but they don’t care about retail investors.

This is a race to the bottom, when all else fails and the government converts their debt investment to equity at eye watering multiples, wiping out retail holders.

History might not repeat exactly, but it does rhyme and precedent is in favour of a poor outcome for retail investors, except those who buy at $0.21 like last time.

A very dangerous share and company right now for small investors, better maybe to cash out and wait for the buy in for the next cycle.

History is your friend, ignore it with this cyclical at your peril,

[Stranger_Danger]

What some people seem to be missing is that AIR have failed before now, spectacularly failed which wiped out their retail investors.

AIR relies in these circumstances on their creditors. Their creditor of last resort is the government. The government won’t let the national airline fail but they don’t care about retail investors.

I would agree that the Government doesn't care about rich retail investors. But as the Sharesies revolution picks up ever larger numbers of "normal kiwis", in addition to "investor" we can attach another label to them. Voters. In increasingly large numbers.

I don't think an Ardern Government would want to be seen throwing a large number of normal kiwis to the wolves, at least, not before an election. I suspect that is why we've now had confirmation that the rights issue won't be till well after.

I get it, but it is very dangerous. If they delay it and a reliable vaccine pops up, they are geniuses. But I can think of a lot of other things that could happen in the next six months, many of them bad.

[nztx]

What some people seem to be missing is that AIR have failed before now, spectacularly failed which wiped out their retail investors.

AIR relies in these circumstances on their creditors. Their creditor of last resort is the government. The government won’t let the national airline fail but they don’t care about retail investors.

This is a race to the bottom, when all else fails and the government converts their debt investment to equity at eye watering multiples, wiping out retail holders.

History might not repeat exactly, but it does rhyme and precedent is in favour of a poor outcome for retail investors, except those who buy at $0.21 like last time.

A very dangerous share and company right now for small investors, better maybe to cash out and wait for the buy in for the next cycle.

History is your friend, ignore it with this cyclical at your peril,

Good points too

With such glowing domestic market prospects & an Airline attempting resizing itself down to the prevailing times
I dont see bright intermediate or medium term prospects for AIR on the horizon either - considering second Covid-19 waves
in Europe now & probably elsewhere are strongly likely

AIR is likely to be on Life Support for some time & now is chomping in the High Usary Govt Lifeline Loans right now

How long until effective Vaccine pops up ? how long is a piece of string could be an appropriate answer

The same answer applies to relaxed international travel -- obviously not on radar anytime soon

Haven't been a holder in this basketcase of Bubbles of Debt on wings for some time & wont be
in future either .. even if someone paid me to jump in

[Waltzing]

"This is a race to the bottom, when all else fails and the government converts their debt investment to equity at eye watering multiples, wiping out retail holders."

.021 cents a share

WE LIVE IN HOPE!

FEAR THE MARKET PEOPLE. LIVE IN FEAR. ITS REAL.

[Raz]

Just been overseas to get some business squared off before the fall second wave really kicks in. It is an eye opener to see what a mess the western world is currently when you are on the ground. It would be a long time before many people would want to visit these countries for a holiday..regardless of the obvious barriers to travel which need to be resolve, seriously it's that bad.

[Waltzing]

we are still in the MR B camp on this one and for all those SH people who bought on that platform but dont own the base share i wonder just what they are thinking .....

Read the ACA's post last night as we were out dinning with the swed's at level 1 freedom and laughed.

They are very happy sweds to be here as residents, a country of immigrants it appears. The welsh man at the table who had live here for 30 years complimented the country also.

For us all All travel postponed back to europe until June 27th 2022.

Still NZ has an orchestra which is wonderful and therefore its not the 1820's. And Te Papa has come a long way....Well done NZ, hats off to you.

[Heimand]

https://www.rnz.co.nz/news/world/427...-travel-bubble

[Waltzing]

it will depend out they control there external borders. And just look at it raging round the world. Every few days a few new cases turn up in isolation. They are coming in as we speak every few days. Imaging how many will leak into australia. NZ got lucky as i sent a view to consultants for the military in wellington at the beginning that the roll out at the border was to slow. The view in wellington was that border control would not need a military support roll out. They change there minds a few months in. They said to me "Harden up" and i thought "Its the border you need to harden" but reframed from ranting some more...That what happens when your family are military and now consultants. They even did the consulting for the china film war scenes. As the virus started to go out of control they were champagning there success for the china film. They arent so confident now.