idea out of left field-new domestic airline
Join Date: Oct 2005
Location: Fliegensville, Gold Coast Australia
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Agree Mick.....100%, but also just saying the 'Virgin' smoke & Mirror trick has to go as well, all that travel bank liability has to be honoured for sure....(but how to fund that!?!?!)....but dropping the, now virtually Toxic 'Virgin' label needs be done also...it does at least save 10 - 15 mi9ll $ a year from someone who contributes nothing but cringeworthy PR stunts?
I'd do that sort of rubbish for 15 mill a year!..
I'd do that sort of rubbish for 15 mill a year!..
Join Date: Jul 2007
Location: BAO
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Hmmmmmm-
So- with 'what' is described 'Above'......., 'ex' the Port-Side of 'Adventure', '****es' and 'Giggles'.............
'What'- Mr 'Momoe' said...............!!!!! +Some/and then some More......
Anyhoo- 'crack' it all open in 72hrs.............. and Rock-ON.......!!!!!
Rgds
S28
So- with 'what' is described 'Above'......., 'ex' the Port-Side of 'Adventure', '****es' and 'Giggles'.............
'What'- Mr 'Momoe' said...............!!!!! +Some/and then some More......
Anyhoo- 'crack' it all open in 72hrs.............. and Rock-ON.......!!!!!
Rgds
S28
Join Date: Dec 2006
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The brand licencing fee (rumoured to have been closer to $15 million a year under the new and improved deal JB did) is going to be the least of your worries if you want come back as Virgin Mk Anything.
The issue that will be weighing much more heavily on any prospective buyers contemplating trying to soldier on under the Virgin banner is the value of the Travel Bank liability; all those punters out there holding on to travel credit vouchers for cancelled flights. That value hasn't been included in any of the public disclosures yet for the simple reason that it's a contingent liability. While the airline continues to be an airline there's the possibility that that liability can be discharged in the course of its normal business.
So, if you're contemplating buying the carcass and building your business out of the VA customer base then you are pretty well committed to having to honour the travel credits at face value or very bloody close to it. The value of the Travel Bank hasn't been disclosed yet but it is likely to be a very big number, perhaps $1 billion. The value of Unearned Revenue (cash held for flights yet to be flown) as at 31 December 2019 was $1.2 billion and Unearned Revenue is probably a very good surrogate for the Travel Bank.
Whatever the value is, probably 80 percent of that is going to be foregone revenue in your first year of operation. It will hit your bottom line such that year one will be a very significant loss, but more importantly it will hit cash flow. The business will have to be cashed up to the eyeballs to get through its first year. I would think that it will be pretty well diabolical for any buyer who is thinking of continuing to wave the Virgin banner in any shape or form.
The issue that will be weighing much more heavily on any prospective buyers contemplating trying to soldier on under the Virgin banner is the value of the Travel Bank liability; all those punters out there holding on to travel credit vouchers for cancelled flights. That value hasn't been included in any of the public disclosures yet for the simple reason that it's a contingent liability. While the airline continues to be an airline there's the possibility that that liability can be discharged in the course of its normal business.
So, if you're contemplating buying the carcass and building your business out of the VA customer base then you are pretty well committed to having to honour the travel credits at face value or very bloody close to it. The value of the Travel Bank hasn't been disclosed yet but it is likely to be a very big number, perhaps $1 billion. The value of Unearned Revenue (cash held for flights yet to be flown) as at 31 December 2019 was $1.2 billion and Unearned Revenue is probably a very good surrogate for the Travel Bank.
Whatever the value is, probably 80 percent of that is going to be foregone revenue in your first year of operation. It will hit your bottom line such that year one will be a very significant loss, but more importantly it will hit cash flow. The business will have to be cashed up to the eyeballs to get through its first year. I would think that it will be pretty well diabolical for any buyer who is thinking of continuing to wave the Virgin banner in any shape or form.
Reckon you either ask "what happens after VA" or "what happens if VA2", thinking the first option looking more and more the reality of a sad JB legacy.
Cheers
Very much enjoy Mick's contributions, wondering if an ex AN character with time on his hands to understand and analyse, not too many people attacking his salient points - bit of a first for Pprune.
Reckon you either ask "what happens after VA" or "what happens if VA2", thinking the first option looking more and more the reality of a sad JB legacy.
Cheers
Reckon you either ask "what happens after VA" or "what happens if VA2", thinking the first option looking more and more the reality of a sad JB legacy.
Cheers
Join Date: Oct 1999
Location: ex EGNM, now NZRO
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Back in the day on the main page (maybe 20 years ago??) there was a joker who was going to do low cost trans Atlantic using a fleet of L-1011's he had 'access' too. Why does this thread sound familiar?
