Originally Posted by
Half Baked
House of cards!
Without continued foreign capital injection, the music stops. How long can this continue before the financial taps are turned off?
The taps were turned off some time ago. The last equity injection was by HNA in September 2016. After that Air NZ sold their shares, but no external equity has come in since then. If you look at the net cash flow (that is, the cash coming in from operations), it's been pretty healthy. At the end of the day, it's not a lack of profits that kills a business, it's a lack of cash, and they certainly have a bit in the wallet.
This huge net loss is Virgin taking a bath on a few items, after which things will improve in future. The charges are accounting and not cash, so fundamentally they aren't dipping into the kitty to make up any shortfall - indeed, the kitty is growing. Their next challenge will be to pare down some of their debt.