Originally Posted by
T-Vasis
The going-concern value is often greater than the liquidation value of airlines, thereby motivating an infusion of capital into bankrupt or near bankruptcy airlines rather than their liquidation. Virgin isn't there yet. It has positive cash flow, has over a billion in cash reserves and it can service its debts.
who are these people who are going to throw good money after bad. Major shareholders.. nope.
can they issue more shares.. nope. They would need to be issued at a discount. Nobody will want to subscribe. Issue more corporate bonds.. I am sure those that bought the last lot and have lost 20% will be lining up to repeat the process.
as for positive cashflow.. nope.
Year end Dec 2019. Dec 2018
cash flow from operations. +$199m +$263m. Difference was restructuring costs of -62.4 in 2019
cash flow from investing. -$122.7m. -$263.6m. Difference was +131.8 disposal of assets in 2019
cash flow from financing. -$708.5m. -$198.7m
net cashflow. -632.1m. -199.3m
$200m positive from operations is easily wiped out by something like a virus.. but overall substantially negative cash flows in the last two non virus years.