Well, Rex's now halfway through that two year rapid expansion phase. How are they doing?
They are half way through their start up capital, so that says it all. The $150million was startup capital, that's what it's for, not sure what people expected that it just sits in a bank account and they would be profitable off the bat. They also just announced expansion to 30 aircraft so that says they are bullish on the next 12 months. So the answer is things look as though they are on plan, nothing spectacular, nothing bad.
You cannot possibly believe that. Rex essentially doubled its issued shares with the PAG deal. There is no way possible that they could issue another $100 million in shares. That's just rank nonsense.
Rex raised $150million to start up the jets on a share conversion deal, there is no doubt with the current 'actual' value of the company another deal worth $100 or even $150 million would be easy. Again this is QFs problem, they are losing big investors for blind faith mom and dads and other bets rather than commercial sense. If you were a large company looking to invest why would you bet on QF, theres no way to re-coop losses, the company is worth less than 1c per share in assets. You then have the issue that most of cash is tied up in the company maintaining profitability, so then the net tangible drops negative, thats why its worth -.35 cents a share. Rex you could buy in now and sell its assets for the price you paid for the shares, very low risk to a large player.
Well, we saw exactly how the market responded to Qantas's share placement "for life support" in late 2020. $1.36 billion raised from the institutional placement and the shares are currently trading at a 35 percent premium to the issue price.
Fools and their money soon parted. Joyce is good at spin, but the fundamentals are very bad for QF with all the competition going its way. QF and Telstra share the 'national' identity con, where Australians buy into anything at stupid prices just because they feel it's Australian. All they are doing is padding Joyces retirement plan as he spins creative accounting to make a lame duck look like it could win the Melbourne cup.
Now you're getting close to what Qantas's short-term problem is - I'm surprised no analyst has commented on it yet. That said, that "market" you were quoting earlier values their shares just north of $5 a pop. That is how the market views their recovery and future earnings potential. Through the pandemic Qantas's FF program alone generated four times the revenue and eight times the profit that Rex could manage in a very good year. But if you want to go long on Rex, I doubt anyone will look to get in your way.
This is far from short term, the creative accounting involved selling the silverware behind the scenes. The paydown in debt you mentioned that happened this half was bankrolled by the sale of QF owned Mascot land and facilities, some $600 million of assets gone exchanged to lease it back. QF has been gutted like VA was to the point its an operating shell with no physical value. That will never return to where it was.