SKYWEST Airlines said yesterday...
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SKYWEST Airlines said yesterday...
Confidence on finances for Skywest
By Geoffrey Thomas
SKYWEST Airlines said yesterday it was confident it would be able to convince the State Government that the airline's finances were strong enough to warrant a continuation of its monopoly on some routes.
Chief executive Scott Henderson said he expected the company would have the necessary aircraft leases renegotiated by the end of the month and would have a rights issue completed by early next month.
The rights issue and accompanying placement is expected to be worth up to $2 million.
Planning and Infrastructure Minister Alannah MacTiernan warned Skywest last week it would lose its monopoly on some routes if it was unable to secure financing for its five F-50 aircraft and if written assurances were not forthcoming about its ability to pay its debts as they fell due.
Mr Henderson said yesterday these targets would be met. "We have told the Government that we will have a deal in place by the end of April," he said.
Skywest's five F-50s have a book value of $15.3 million, but the airline owes the Commonwealth Bank $13.3 million.
However, that book value is now over six months old and observers suggest the values may be as low as $12 million with the Iraq war and the outbreak of SARS stripping values from airlines and aircraft around the globe.
Analysts in Asia have warned that some of Qantas' 20-year old Boeing 747s and 767s may have to be written off.
The lease on the Skywest aircraft falls due on June 30 and a partial interim payment, due on March 31, was deferred, say airline sources, because it would have triggered the final payout.
Commonwealth Bank is believed to have told Skywest it would agree to renegotiate the leases if the airline was able to raise more equity.
Skywest is planning to raise capital through a rights issue and a placement. Skywest shareholders include chairman Pat Ryan, property developer Clive Hartz and winemaker Franklin Tate.
Paterson Ord Minnett will handle the rights issue.
Late last month Skywest was dealt a blow when respected director and shareholder Mike Calneggia resigned from the board.
Mr Calneggia, whose 6 per cent in the airline is valued at $350,000, did not elaborate on his departure.
However, Mr Calneggia, who was a driving force behind Skywest's recent restructure, was believed to have concerns about other boardroom issues.
Skywest faces significant challenges to stay in the air after posting a six-month loss of $975,000 to December 31.
On the short term radar is litigation with the airline's former chief executive Bill Meeke, who is suing for $1.3 million for breach of contract over his sacking last year.
A planned 7 per cent fare rise to bolster revenues looks questionable.
By Geoffrey Thomas
SKYWEST Airlines said yesterday it was confident it would be able to convince the State Government that the airline's finances were strong enough to warrant a continuation of its monopoly on some routes.
Chief executive Scott Henderson said he expected the company would have the necessary aircraft leases renegotiated by the end of the month and would have a rights issue completed by early next month.
The rights issue and accompanying placement is expected to be worth up to $2 million.
Planning and Infrastructure Minister Alannah MacTiernan warned Skywest last week it would lose its monopoly on some routes if it was unable to secure financing for its five F-50 aircraft and if written assurances were not forthcoming about its ability to pay its debts as they fell due.
Mr Henderson said yesterday these targets would be met. "We have told the Government that we will have a deal in place by the end of April," he said.
Skywest's five F-50s have a book value of $15.3 million, but the airline owes the Commonwealth Bank $13.3 million.
However, that book value is now over six months old and observers suggest the values may be as low as $12 million with the Iraq war and the outbreak of SARS stripping values from airlines and aircraft around the globe.
Analysts in Asia have warned that some of Qantas' 20-year old Boeing 747s and 767s may have to be written off.
The lease on the Skywest aircraft falls due on June 30 and a partial interim payment, due on March 31, was deferred, say airline sources, because it would have triggered the final payout.
Commonwealth Bank is believed to have told Skywest it would agree to renegotiate the leases if the airline was able to raise more equity.
Skywest is planning to raise capital through a rights issue and a placement. Skywest shareholders include chairman Pat Ryan, property developer Clive Hartz and winemaker Franklin Tate.
Paterson Ord Minnett will handle the rights issue.
Late last month Skywest was dealt a blow when respected director and shareholder Mike Calneggia resigned from the board.
Mr Calneggia, whose 6 per cent in the airline is valued at $350,000, did not elaborate on his departure.
However, Mr Calneggia, who was a driving force behind Skywest's recent restructure, was believed to have concerns about other boardroom issues.
Skywest faces significant challenges to stay in the air after posting a six-month loss of $975,000 to December 31.
On the short term radar is litigation with the airline's former chief executive Bill Meeke, who is suing for $1.3 million for breach of contract over his sacking last year.
A planned 7 per cent fare rise to bolster revenues looks questionable.
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With friends like this reporting the "truth" who needs a PR company.
I did like the quote from the Minister
"Planning and Infrastructure Minister Alannah MacTiernan warned Skywest last week it would lose its monopoly on some routes if it was unable to secure financing for its five F-50 aircraft and if written assurances were not forthcoming about its ability to pay its debts as they fell due."
If they dont secure the aircraft then how are they going to fly any routes??????
I did like the quote from the Minister
"Planning and Infrastructure Minister Alannah MacTiernan warned Skywest last week it would lose its monopoly on some routes if it was unable to secure financing for its five F-50 aircraft and if written assurances were not forthcoming about its ability to pay its debts as they fell due."
If they dont secure the aircraft then how are they going to fly any routes??????
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I would not be expecting much considering they amend their flight plans over head Geraldton when they haven't got any PAx to stop at Gero and their biggest load to date is apparently only 5 PAX........
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Apollo 4
GWA have survived may a troubled time but never in the RPT field.
remember Western Airlines, where did they go and where are they now??
If the last report I read is true then Geraldton is open to competition now,so here is the chance for all the others to rush into the high profits of an RPT route.
Remember many a charter company has gone bust after moving into RPT because the next run will always be better than the last and profits they used to make every trip have dried up.
The big issue here is not wether Skywest can refinance the aircraft but wether they get a fair hearing in the press and are allowed to try?
GWA have survived may a troubled time but never in the RPT field.
remember Western Airlines, where did they go and where are they now??
If the last report I read is true then Geraldton is open to competition now,so here is the chance for all the others to rush into the high profits of an RPT route.
Remember many a charter company has gone bust after moving into RPT because the next run will always be better than the last and profits they used to make every trip have dried up.
The big issue here is not wether Skywest can refinance the aircraft but wether they get a fair hearing in the press and are allowed to try?
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Bendt,
GWA arent going into GEL anymore due to the Govt. not allowing it.
Flight plan amendments overhead GEL isn't because of no Pax, it is because a fuel stop is no longer required.
Skippers are keeping very quiet in all this... will be interesting to see if they decide to take a crack at the GEL/SHK routes.
GWA arent going into GEL anymore due to the Govt. not allowing it.
Flight plan amendments overhead GEL isn't because of no Pax, it is because a fuel stop is no longer required.
Skippers are keeping very quiet in all this... will be interesting to see if they decide to take a crack at the GEL/SHK routes.
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I think Skywest have had nothing but a 'fair go' in the press recently. When was the last time someone posted a newpaper article bagging Skywest?
Don't get me wrong, I wish them all the very best in this trying time, but you must admit, they have had a lot of cash and protection from the government for the last 19 months.
The time for results has to be now.
Once again - best of luck.
Don't get me wrong, I wish them all the very best in this trying time, but you must admit, they have had a lot of cash and protection from the government for the last 19 months.
The time for results has to be now.
Once again - best of luck.
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i really hope that Skywest do produce the results as many communtities will be disadvantaged if they don't, i can't see anyone else providing the good service to these towns that Skywest does.
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Geoffrey Thomas's article in today's West is enough to convince me (and I generally keep an open mind, innocent until proven guilty and all that) that he is most certainly doing a hatchett job on Skywest.
I happen to know that Skywest are travelling better than have done in a long time, the guys and girls have agreed to take pay cuts and improve productivity to save the company. This is a very dedicated and professional bunch who are committed to making their airline work (yes they are all share holders).
The West Australian would be perhaps more appropriately renamed the "The Meek Australian". Why doesn't this paper mention the other lawsuits Mr Meek has instigated? Is Mr Meek a "serial suer"? I recall reading somewhere about him suing his last employer also, and also recall that he sued (or attempted to sue) government over coastwatch contract some 10 or so years ago. I would not be surprised if there is more history. Why was there no mention of Skywest's recent milestone - 40 years in business (congratulations SKywest - that is something to proud of in any industry, but particulary aviation).
Geoffrey, give Skywest a break. Even if you dislike the board, give the staff a break. This kind of media can bring down an airline. It is hard enough to survive in this industry without this. Suggest you go and talk to the staff, and put personal feelings /friendships aside.
I happen to know that Skywest are travelling better than have done in a long time, the guys and girls have agreed to take pay cuts and improve productivity to save the company. This is a very dedicated and professional bunch who are committed to making their airline work (yes they are all share holders).
The West Australian would be perhaps more appropriately renamed the "The Meek Australian". Why doesn't this paper mention the other lawsuits Mr Meek has instigated? Is Mr Meek a "serial suer"? I recall reading somewhere about him suing his last employer also, and also recall that he sued (or attempted to sue) government over coastwatch contract some 10 or so years ago. I would not be surprised if there is more history. Why was there no mention of Skywest's recent milestone - 40 years in business (congratulations SKywest - that is something to proud of in any industry, but particulary aviation).
Geoffrey, give Skywest a break. Even if you dislike the board, give the staff a break. This kind of media can bring down an airline. It is hard enough to survive in this industry without this. Suggest you go and talk to the staff, and put personal feelings /friendships aside.
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I would not be surprised if there is more history. Why was there no mention of Skywest's recent milestone - 40 years in business (congratulations SKywest - that is something to proud of in any industry, but particulary aviation).
Is a typical PR BS use of semantics.
40 years if you include AND acknowledge from whence they came, but barely 18 for the name of the entity which was merged with others.
Meeke is a newbie in the pantheon of those who were part of the process of evolution and could have only got up "there" as part of the Stowe/Ansett schemings.
The problems they are now experiencing, without their Big Brother are exactly the same problems that faced their ancestors 40 years ago. I know because I was actually there.
Geoffrey might have a better kowledge of that background than you think.
When I get back form work today I will give you the history and lineage.
I have no problems with them saying "40 years" as long as they
recognise from whence they came and I can assure you it was not from Meekes 40 year old Skywest.
Just as a bit of a clue Skywest started as an operator out of Witenoom.
Thread Starter
Carnarvon Air Taxis, one of the original companies involved, a good rundown on the history is in the back of the "ANSETT" history book, by Jim Thorn...
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The interesting bit in GT's article on Saturday was about WMC.
From his comment the only reason Skywest did not get the contract was because Meeke had gone and I am sure it had nothing to do with the fact that they had had Qantas jets for the last year and frequent flyer points? All the things Skywest did not have at that time!
However it does seem odd that they managed to get Argyle without him? After all from GT's words he is/was the only one who knew anything about aviation at Skywest.
In regard to law suits try a search for Coastwatch in the law archives and see how many suits there have been during his reign?
From his comment the only reason Skywest did not get the contract was because Meeke had gone and I am sure it had nothing to do with the fact that they had had Qantas jets for the last year and frequent flyer points? All the things Skywest did not have at that time!
However it does seem odd that they managed to get Argyle without him? After all from GT's words he is/was the only one who knew anything about aviation at Skywest.
In regard to law suits try a search for Coastwatch in the law archives and see how many suits there have been during his reign?
Last edited by jetpipe; 21st Apr 2003 at 18:13.
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Too right jetpipe! Hey GT you on holidays?? I guess perhaps your editor cut all the stuff you were going to say about Mr Meeke due to a lack of space etc etc. Its a shame that just a little couldnt have been squeezed in, you know, in the interests giving a balanced view of events. Don't Editors suck!
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Good Old Trans West... What ever happened to the old fleet of TW. Spent many an hour in VH-TWX C402B (trixy) as she was effectionately known then.
Has anyone got a photo of the old Skywest office at Wittenoom?
Captain Ace can you help out with a photo?
Many a memorable night spent out the back or in the old Fortesque Hotel.
Alas I fear that the idiots running the board of Skywest now may have sealed its fate, sadly a great airline with pi$$ poor fiscal management or know how ...
Has anyone got a photo of the old Skywest office at Wittenoom?
Captain Ace can you help out with a photo?
Many a memorable night spent out the back or in the old Fortesque Hotel.
Alas I fear that the idiots running the board of Skywest now may have sealed its fate, sadly a great airline with pi$$ poor fiscal management or know how ...
Thread Starter
Apollo 4,
lets not forget that many of the problems xr have faced in the last 18 - 24 months have not been entirely of it's own making, under the ansett banner skywest was profitable and having a hook up with a major carrier provided it with the on-carriage traffic that it desperately needed to survive.
With ansett gone, the board and mangement suddenly realise that someone in melbourne aint making the economic decisions anymore so it's time to fend for themselves.
henderson has publicly stated that loadings are better than ever for the first few months of the year, and the interline agreement with qf will only enhance this. Staff who are clearly committed to the survival of the company and are willing to increase productivity and take a wage cut to see the company through are helping as a range of economic and cost-cutting initiatives are brought into place. The WA govt quite rightly moved to protect xr on it's marginal routes (all except gel) which will help too. A jet of the right type in the F100 also gives them the opportunity to expand the mining contracts and charter side of the business.
So i don't think their fate is sealed at all, true there is a long way to go, but they have started to make steps in the right direction and lets hope for the sake of the industry that it comes off.
lets not forget that many of the problems xr have faced in the last 18 - 24 months have not been entirely of it's own making, under the ansett banner skywest was profitable and having a hook up with a major carrier provided it with the on-carriage traffic that it desperately needed to survive.
With ansett gone, the board and mangement suddenly realise that someone in melbourne aint making the economic decisions anymore so it's time to fend for themselves.
henderson has publicly stated that loadings are better than ever for the first few months of the year, and the interline agreement with qf will only enhance this. Staff who are clearly committed to the survival of the company and are willing to increase productivity and take a wage cut to see the company through are helping as a range of economic and cost-cutting initiatives are brought into place. The WA govt quite rightly moved to protect xr on it's marginal routes (all except gel) which will help too. A jet of the right type in the F100 also gives them the opportunity to expand the mining contracts and charter side of the business.
So i don't think their fate is sealed at all, true there is a long way to go, but they have started to make steps in the right direction and lets hope for the sake of the industry that it comes off.