eglnyt
Look carefully and you'll see that NATS is trading profitably but it's real assets excluding goodwill and the pension fund are at best the same as its liabilities.
The company has increased its net assets in 2008 by over 40% (£190m) compared to 2007. This performance has been reflected in previous years results as NATS has had 5 consecutive years of profits.
The financial report for 2008 cites currency fluctuations, interest rates, inflation etc as possible future risks to the company...no mention of the pension scheme.
However, the management is charged with reducing costs to the company to increase profits.
It doesn't have much in the way of reserves and it's potential to borrow is limited because it's already heavily borrowed against its assets. It is much more robust than it was in 2001 and with prudent management can survive most expected events but not a big trauma.
The 2008 report emphasises the groups strong cash flows and shows a reduction in net debt of almost £40m in 2008.
NATS performance was so strong last year that it was able to repay shareholder loan notes of £65m incurring an additional charge of £15.8m in the process.
The aviation business is cyclical and to justify attacking pensions on the premise of a temporary downturn is disingenuous at best. And besides, there is no sign of the company struggling in any way...just the opposite in fact.
They were all voluntary redundancies and most were jumping to avoid having to resign when we moved out of London but they were still real people who lost real jobs even if some people prefer to refer to them as dross.
So how many jobs were shed that were unrelated to the voluntary departures relating to the move from West Drayton?
It's got nothing to do with opposing or supporting the management's proposals. I was referring to an ignorance of risk management even though so much of what we do in NATS is based upon it. Those familiar with risk management will recognise that sometimes the bad thing is so bad that you have to do something about it even if it isn't very likely. This may be one of those times.
I can understand managements wish to mitigate any possible risk to NATS ever growing profits by transferring that risk to the employees.
I'm sure you'll understand my reluctance to offer up my T&C's to ensure those profits can grow even more quickly.
See my previous response. If I could lose my pension and the chance of that happening was less than impossible then I might be prepared to offer up some T&Cs to make it less likely, especially if in practice what I was offering up was next to nothing. As I've said before how close to nothing this particular T&C is depends upon how optimistic you are about future payrises
.
In what circumstances do you envisage the pension being lost?
IMO, by far the most likely route to losing our final salary scheme is this:
We agree to these proposals and make the company far more attractive to future bidders (we know that's the real issue here). Do you believe the next owner of NATS is going to settle for the present deal? Of course not. The attacks on the pension won't stop until the final salary scheme is closed for both present and future employees.
You probably didn't realise it when you made that post but you've illustrated exactly why the company wants to implement the RPI+0.5% cap. Over pension timescales a small increase can have an enormous effect on the liability.
So you're agreeing that a pay freeze for a year or 2 would have an enormous effect on future pension liabilities?
Many of the arguments forwarded in support of the managements proposals seem to be contradicted when balanced against the companies own reports and indeed the reports of other shareholders.
The Governments own Shareholder Executive which oversees the SoS for T's 48.9% stake in the company lauds NATS'...
'
strong financial performance' and '
growing financial strength recognised by Standard & Poor's who upgraded its credit rating from A- to A. '