SilverJet (Merged 30/05)
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Pessimism? No it's called REALISM.
Sorry SAM2M you are wrong to say we are all pessimists here, what you are seeing is the realistic views being expressed by contributors who do not believe all the SJ hype and spin.
Nobody here (with the odd ghoul-like exception) wishes to see our colleagues in the aviation industry fail, however you have to face facts and the truth is all too clear to see.
For somebody to claim that "the LF is going to be (sic) 60% which makes the airline almost not unprofitable..." is utter tosh! Very similar in fact to what was being fed to the employees of Dan Air in the final days in the early '90s when the word from head office was that Dr James was in charge now and everything would be fine, "he says that we only need to sell one more seat in business class on each of our routes and we'll be in the black again!" Well if it was THAT easy, what on earth was all the fuss about?
Of course it's just not that easy and the worst news this week was from 'The Brothers' - there's just no way to dress it up. Catastrophic news indeed. If they cannot show support for the venture, then this really is curtains and will likely deter any other potential investors at this stage.
It is always easier to be wise after the event and it was a great idea, however now it is obvious that the traffic is not there - at least not from an airport which has been so tainted by the lowcost phenomenon.
Recent test flying of the 2 ex TOM 76's? No point really, an insider tells me they will never be painted Silver....
Nobody here (with the odd ghoul-like exception) wishes to see our colleagues in the aviation industry fail, however you have to face facts and the truth is all too clear to see.
For somebody to claim that "the LF is going to be (sic) 60% which makes the airline almost not unprofitable..." is utter tosh! Very similar in fact to what was being fed to the employees of Dan Air in the final days in the early '90s when the word from head office was that Dr James was in charge now and everything would be fine, "he says that we only need to sell one more seat in business class on each of our routes and we'll be in the black again!" Well if it was THAT easy, what on earth was all the fuss about?
Of course it's just not that easy and the worst news this week was from 'The Brothers' - there's just no way to dress it up. Catastrophic news indeed. If they cannot show support for the venture, then this really is curtains and will likely deter any other potential investors at this stage.
It is always easier to be wise after the event and it was a great idea, however now it is obvious that the traffic is not there - at least not from an airport which has been so tainted by the lowcost phenomenon.
Recent test flying of the 2 ex TOM 76's? No point really, an insider tells me they will never be painted Silver....
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pprune NEGATIVE posters
If Silverjet does go into profit next month it will be a record for a start up schedule airline. Nobody gave Virgin or Air 2000 a chance 15 years ago.
The point has been completely missed that the Ruebens have not pulled out. They are continuing to work with Silverjet on a number of projects including further fleet expansion.
The same old people come out with negative stuff. Nobody disagrees that the people who are really happy with Silverjet are the customers and that is more than half the battle won.
Luton "tainted by low cost" Have you any idea how many executive jets operate out of there ?? Harrods terminal/Net Jets etc ?
Just leave the company to get on with it
The point has been completely missed that the Ruebens have not pulled out. They are continuing to work with Silverjet on a number of projects including further fleet expansion.
The same old people come out with negative stuff. Nobody disagrees that the people who are really happy with Silverjet are the customers and that is more than half the battle won.
Luton "tainted by low cost" Have you any idea how many executive jets operate out of there ?? Harrods terminal/Net Jets etc ?
Just leave the company to get on with it
Last edited by 8che; 12th Feb 2008 at 09:57.
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Silverjet hits new low as Eos plans to fly same routes
By Kevin Done, Aerospace Correspondent
Published: February 12 2008 00:29 | Last updated: February 12 2008 00:29
The share price of Silverjet, the UK all-business class airline, fell to a new low on Monday, as the rival US carrier Eos Airlines announced plans for services between London and both Dubai and New York Newark – the two routes operated by Silverjet.
Competition for lucrative premium passengers in the London market is intense, and the start-up all-business class carriers face a tough battle to develop their networks amid rising fuel prices and a determined response by the legacy network airlines.
British Airways announced two weeks ago that it planned to launch two all-business class flights a day next year between New York and London City airport, the closest airport to the financial districts of the City of London and Canary Wharf.
Concerns have been growing about the viability of the all-business class, long-haul airline model, since Maxjet Airways, a rival US start-up flying between London and the US, collapsed into bankruptcy in late December.
The Silverjet share price fell 2p or 8 per cent on Monday to close at 22p, as the airline also confirmed that the Reuben brothers, the UK property developers, had abandoned their plan to convert a £10m loan into an equity stake in the group because of the collapse in the share price to less than half the 60p conversion price. The loan will remain in place and is repayable at the end of December 2009.
Lawrence Hunt, Silverjet chief executive, said the group’s “primary focus is to continue driving passenger numbers and yields, thereby restoring shareholder value”.
The share price has fallen 89 per cent from the peak of 209p reached in March last year.
Based on bookings to date Mr Hunt said he was “highly confident” that the airline would fill more than 60 per cent of its available seats in February, up from 54 per cent in January, at an increased yield.
Forward bookings beyond February continued to be “strong”, he said.
Eos said it planned to start daily services between Stansted and New York Newark in May and between Stansted and Dubai in July.
It began flying between London Stansted and New York JFK airports in October 2005 with 48-seat Boeing 757s and a premium cabin pitched between business and first class.
To date it has concentrated on building the frequency of its services between London and New York, rather than broadening the network, and is currently flying four times daily on the busiest days. It has expanded its fleet from four to seven aircraft.
Silverjet began flying in January 2007 and operates twice a day between London Luton and New York Newark and daily to Dubai.
It has a fleet of three 100-seat Boeing 767s and is due to add two more next month.
Copyright The Financial Times Limited 2008
By Kevin Done, Aerospace Correspondent
Published: February 12 2008 00:29 | Last updated: February 12 2008 00:29
The share price of Silverjet, the UK all-business class airline, fell to a new low on Monday, as the rival US carrier Eos Airlines announced plans for services between London and both Dubai and New York Newark – the two routes operated by Silverjet.
Competition for lucrative premium passengers in the London market is intense, and the start-up all-business class carriers face a tough battle to develop their networks amid rising fuel prices and a determined response by the legacy network airlines.
British Airways announced two weeks ago that it planned to launch two all-business class flights a day next year between New York and London City airport, the closest airport to the financial districts of the City of London and Canary Wharf.
Concerns have been growing about the viability of the all-business class, long-haul airline model, since Maxjet Airways, a rival US start-up flying between London and the US, collapsed into bankruptcy in late December.
The Silverjet share price fell 2p or 8 per cent on Monday to close at 22p, as the airline also confirmed that the Reuben brothers, the UK property developers, had abandoned their plan to convert a £10m loan into an equity stake in the group because of the collapse in the share price to less than half the 60p conversion price. The loan will remain in place and is repayable at the end of December 2009.
Lawrence Hunt, Silverjet chief executive, said the group’s “primary focus is to continue driving passenger numbers and yields, thereby restoring shareholder value”.
The share price has fallen 89 per cent from the peak of 209p reached in March last year.
Based on bookings to date Mr Hunt said he was “highly confident” that the airline would fill more than 60 per cent of its available seats in February, up from 54 per cent in January, at an increased yield.
Forward bookings beyond February continued to be “strong”, he said.
Eos said it planned to start daily services between Stansted and New York Newark in May and between Stansted and Dubai in July.
It began flying between London Stansted and New York JFK airports in October 2005 with 48-seat Boeing 757s and a premium cabin pitched between business and first class.
To date it has concentrated on building the frequency of its services between London and New York, rather than broadening the network, and is currently flying four times daily on the busiest days. It has expanded its fleet from four to seven aircraft.
Silverjet began flying in January 2007 and operates twice a day between London Luton and New York Newark and daily to Dubai.
It has a fleet of three 100-seat Boeing 767s and is due to add two more next month.
Copyright The Financial Times Limited 2008
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Just in from the city.
Silverjet shares down another 30%. Rumour is the shares WILL be suspended tomorrow.
I find it shocking that the company is about to fold and yet they keep taking peoples money.
Its all about money money money. Root of ALL evil.
Silverjet shares down another 30%. Rumour is the shares WILL be suspended tomorrow.
I find it shocking that the company is about to fold and yet they keep taking peoples money.
Its all about money money money. Root of ALL evil.
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The shares will not be suspended tomorrow. I may not think silverjet has a future unless it changes its plans but it should have plenty of cash. It must have taken about £9m in its january sale as advance bookings. It should have plenty of cash for maybe 3-6 months.
They need to firm up existing loads and halt expansion plans.
They need to firm up existing loads and halt expansion plans.
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Predictions are for significantly increased load factor in Feb.
Blue Oar's McNeill has a ``buy'' recommendation and a price target of 130 pence.
``If they succeed, they will succeed on a massive scale,'' the analyst said. ``If they don't, they will go under.''
More Planes
The carrier has three Boeing 767 planes, is taking delivery of two more in March and has yet to decide whether it will introduce new routes or add frequencies to existing ones.
Eos is more likely to win customers from British Airways Plc than Silverjet on its Dubai route because it targets first-class passengers rather than business-class travelers, according to Adam Steiner, who helps manage about $1 billion at SVG Capital Plc.
``Silverjet is a budget business class airline,'' Steiner said. ``In terms of its business model, Eos doesn't compete against Silverjet.''
To contact the reporter on this story: Steve Rothwell in London at [email protected]
Blue Oar's McNeill has a ``buy'' recommendation and a price target of 130 pence.
``If they succeed, they will succeed on a massive scale,'' the analyst said. ``If they don't, they will go under.''
More Planes
The carrier has three Boeing 767 planes, is taking delivery of two more in March and has yet to decide whether it will introduce new routes or add frequencies to existing ones.
Eos is more likely to win customers from British Airways Plc than Silverjet on its Dubai route because it targets first-class passengers rather than business-class travelers, according to Adam Steiner, who helps manage about $1 billion at SVG Capital Plc.
``Silverjet is a budget business class airline,'' Steiner said. ``In terms of its business model, Eos doesn't compete against Silverjet.''
To contact the reporter on this story: Steve Rothwell in London at [email protected]
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The load factor will rise to around 60% in feb as they are only operating 2 planes for the last 2 weeks of the month. The management have said this is due to "c" checks. 60% load factor would be about 8,040 pax in the month.
January was our eleventh successive month of record passenger statistics, however the growth achieved has not been as high as we had hoped, and forward bookings, although strong, are unlikely to make up this shortfall in the year ending 31 March 2008. As a result of this, and a C check on one of our aircraft during February which is expected to reduce our rotations by 12, we no longer expect the group, in terms of operating cashflow, to be broadly cash neutral between the Placing and 31 March 2008.
"As a result of this, and a C check on one of our aircraft during February which is expected to reduce our rotations by 12, we no longer expect the group, in terms of operating cashflow, to be broadly cash neutral between the Placing and 31 March 2008."
Always a bit of a worry when airlines blame/fail to budget for routine scheduled maintenance. Imagine if BA blamed the dozens of C checks on its fleet for a financial shortfall...
Always a bit of a worry when airlines blame/fail to budget for routine scheduled maintenance. Imagine if BA blamed the dozens of C checks on its fleet for a financial shortfall...
The £10m convertible loan taken out by the Reuben brothers in November last year was accompanied by a share placing of £12m gross.
I would find it strange if the company has managed to burn it's way through £22m in just three months. It's therefore quite likely that Silverjet is well funded for the present. If they can turn the corner financially in March, and their two new aircraft achieve break-even fairly quickly, there could still be a decent future for Silverjet.
I am surprised that Eos is able, as a US-based airline, to operate between the UK and Dubai as announced yesterday.
I wonder what SJ will use the two additional aircraft for?
I would find it strange if the company has managed to burn it's way through £22m in just three months. It's therefore quite likely that Silverjet is well funded for the present. If they can turn the corner financially in March, and their two new aircraft achieve break-even fairly quickly, there could still be a decent future for Silverjet.
I am surprised that Eos is able, as a US-based airline, to operate between the UK and Dubai as announced yesterday.
I wonder what SJ will use the two additional aircraft for?
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Shares down again today. 16p!!! It takes a very brave investor to put money into this company. I guess bookings will be down on all this negative publicity. The Directors will then blame the media and the likes of prune when the company goes under. How much further will the share price fall? Alot, I think.
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Silverjet chief defends strategy as airline's value crashes to £11m
Wednesday, 13 February 2008
Investors who chose to sink their money into Silverjet – the all-business class airline based at Luton Airport – were no doubt reassured about the high-risk project by the track record of its chief executive, Lawrence Hunt. Before his latest venture, Mr Hunt had run and successfully exited four companies in the rough-and-tumble technology industry – where the ups and downs are more extreme than almost any other sector except, perhaps, the aviation industry.
It is a business that requires nerves of steel. Indeed, while the AIM-listed company's shares plumbed new lows yesterday – dropping 22 per cent to 17p to value the group at just £11m – Mr Hunt was on holiday. Whether shareholders will interpret his break, at a time when the outlook for the carrier has ostensibly never been worse, as a sign of cool-headed confidence is unclear.
By any measure, it has been a brutal few months for Silverjet. The fall in its share price reflects a growing sense of foreboding about the viability of the all-business class airline model. Silverjet's descent was accelerated this week by two pieces of bad news. Firstly, the billionaire Reuben brothers, David and Simon, declined on Monday to convert a £10m loan they had given the company into a 22 per cent stake. Despite claiming that they "continue to believe the company has a sound business model and excellent prospects to become a major player in the global aviation business", their decision – fewer than three months after their initial loan – sent a worrying signal about their confidence in the business.
Secondly, Silverjet's more expensive, higher-end rival Eos announced plans to launch a London to Dubai service that will compete directly with Silverjet's recently-launched flights to the emirate, as well as an additional route to New York via Newark Airport. The companies already go head-to-head on the London to New York route – the only other service that is operated by Silverjet, which targets luxury holiday and business travellers. Analysts are worried that an economic slowdown on either side of the Atlantic will kill the "urge to splurge" that is crucial to Silverjet. At about £1,000 for a business-class return to New York, the company's fares are a fraction of BA's, which can charge up to five times as much.
Throughout Silverjet's downward share spiral – it has lost more than 85 per cent of its value since it was floated in May 2006 – Mr Hunt has stuck to his pledge that it will reach operational profitability by next month.
Mr Hunt on holiday eh!!!
Will he come back???
Wednesday, 13 February 2008
Investors who chose to sink their money into Silverjet – the all-business class airline based at Luton Airport – were no doubt reassured about the high-risk project by the track record of its chief executive, Lawrence Hunt. Before his latest venture, Mr Hunt had run and successfully exited four companies in the rough-and-tumble technology industry – where the ups and downs are more extreme than almost any other sector except, perhaps, the aviation industry.
It is a business that requires nerves of steel. Indeed, while the AIM-listed company's shares plumbed new lows yesterday – dropping 22 per cent to 17p to value the group at just £11m – Mr Hunt was on holiday. Whether shareholders will interpret his break, at a time when the outlook for the carrier has ostensibly never been worse, as a sign of cool-headed confidence is unclear.
By any measure, it has been a brutal few months for Silverjet. The fall in its share price reflects a growing sense of foreboding about the viability of the all-business class airline model. Silverjet's descent was accelerated this week by two pieces of bad news. Firstly, the billionaire Reuben brothers, David and Simon, declined on Monday to convert a £10m loan they had given the company into a 22 per cent stake. Despite claiming that they "continue to believe the company has a sound business model and excellent prospects to become a major player in the global aviation business", their decision – fewer than three months after their initial loan – sent a worrying signal about their confidence in the business.
Secondly, Silverjet's more expensive, higher-end rival Eos announced plans to launch a London to Dubai service that will compete directly with Silverjet's recently-launched flights to the emirate, as well as an additional route to New York via Newark Airport. The companies already go head-to-head on the London to New York route – the only other service that is operated by Silverjet, which targets luxury holiday and business travellers. Analysts are worried that an economic slowdown on either side of the Atlantic will kill the "urge to splurge" that is crucial to Silverjet. At about £1,000 for a business-class return to New York, the company's fares are a fraction of BA's, which can charge up to five times as much.
Throughout Silverjet's downward share spiral – it has lost more than 85 per cent of its value since it was floated in May 2006 – Mr Hunt has stuck to his pledge that it will reach operational profitability by next month.
Mr Hunt on holiday eh!!!
Will he come back???
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not so soon
It is cashflow problems that kills an airline. Silverjet had a big injection of cash in December. Around half of this will be tied up in getting its two extra planes and expanding. It has also taken in millions in advance sales when it was offering 20% off. Any cash crunch is going to come in a few months not days.
If it was not buying two extra planes it could keep going for most of 2008 and slowly built trade. If it does not replan, I see it burning all its cash by May - July
If it was not buying two extra planes it could keep going for most of 2008 and slowly built trade. If it does not replan, I see it burning all its cash by May - July
Rumour is that the two new 767s are being deferred so that the cashflow can be maintained to support the existing EWR/DXB operations. Bringing in two new aircraft, fitting them out and then launching new routes with them will require a significant amount of cash and I am told that the decision has been taken to use what cash is available to prolong the existence of the current operation instead of using it to fund further expansion.
Comments about the seat sale assume that the forward cash is available to fund day-to-day operations. It might not necessarily be the case, particularly where ATOL-bonded sales and credit card deferred revenue comes into play. Its previous set of financials indicated that the more seats they sold, the more they had to reserve for ATOL and credit card deposits, so any number of advance sales might not help operational cashflow.
Comments about the seat sale assume that the forward cash is available to fund day-to-day operations. It might not necessarily be the case, particularly where ATOL-bonded sales and credit card deferred revenue comes into play. Its previous set of financials indicated that the more seats they sold, the more they had to reserve for ATOL and credit card deposits, so any number of advance sales might not help operational cashflow.
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Silverjet shares down again 8% and its not even miday. Is Hunt back from holiday yet to face the music?
8che. The answer is no, thats for monkeys. The clever ones use their brains while on the beach just like Mr Hunt.
You have to face the facts Silverjet will be history. Myself and anybody else that works the city will all tell you the same. The staff at Silverjet will obviously tell a different story.
Now where is my cool beer?
8che. The answer is no, thats for monkeys. The clever ones use their brains while on the beach just like Mr Hunt.
You have to face the facts Silverjet will be history. Myself and anybody else that works the city will all tell you the same. The staff at Silverjet will obviously tell a different story.
Now where is my cool beer?