Vistajet Future
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Vista Global Founder Thomas Flohr Embroiled In UK Lawsuit
From LinkedIn:
The attached article adds to an expanding narrative concerning Vista Global and their founder, Thomas Flohr.
Yesterday’s article, published by WirtschaftsWoche (a German publication) considers a lawsuit that has been filed by Frontier Capital, who are alleging that Vista Global’s founder, Thomas Flohr, is guilty of breach of contract. The complaint demands payment of €58 million (approximately $63.5 million at today’s exchange rate).
The article (English translation attached) suggests that some of the income enjoyed by Mr. Flohr is owed to the plaintiff, Frontiers Capital, under the terms of a contract that was agreed between Frontier Capital’s then Managing Director, Timothy Horlick, and Thomas Flohr. More disturbingly, the complaint alleges that Mr. Flohr went to considerable lengths to divert proceeds from business dealings into entities that were created using similar names to companies that were legitimately involved with business dealings involving the plaintiff and the defendant.
If these accusations are proven to be correct, they point to a seemingly sophisticated plan to deceive business partners. Of course, there is always a presumption of innocence, in London’s High Court. Further, Mr. Flohr, through his lawyers, has insisted that the claims are “inaccurate and the claims made are obviously unfounded”.
Taking a step back, we are seeing a steady accretion of published articles, in the Financial Times and two articles in WirtschaftsWoche, concerning Vista Global and Thomas Flohr. Indeed, several of my own LinkedIn posts have highlighted longstanding concerns about the viability of VistaJet’s business model. It’s difficult not to surmise that smoke frequently foreshadows fire!
We could be witnessing the beginnings of a media feeding frenzy, involving Vista Global and their founder. Journalists appear to be focusing on two subjects, for now. Firstly, Thomas Flohr and his involvement with past and current businesses (Comdisco, Comprendium, Vista Global). Secondly, the financial fortunes of Vista Global, a company that appears to be weighed-down by high levels of debt, rising interest expenses, mounting liabilities associated with unsecured service pre-payments and a charter market in which flight hours and hourly revenues are facing downward pressure.
In addition to monitoring the progress of this lawsuit, I will continue to monitor the media for additional stories concerning Vista Global, their founder and the subsidiaries they own.
The attached article adds to an expanding narrative concerning Vista Global and their founder, Thomas Flohr.
Yesterday’s article, published by WirtschaftsWoche (a German publication) considers a lawsuit that has been filed by Frontier Capital, who are alleging that Vista Global’s founder, Thomas Flohr, is guilty of breach of contract. The complaint demands payment of €58 million (approximately $63.5 million at today’s exchange rate).
The article (English translation attached) suggests that some of the income enjoyed by Mr. Flohr is owed to the plaintiff, Frontiers Capital, under the terms of a contract that was agreed between Frontier Capital’s then Managing Director, Timothy Horlick, and Thomas Flohr. More disturbingly, the complaint alleges that Mr. Flohr went to considerable lengths to divert proceeds from business dealings into entities that were created using similar names to companies that were legitimately involved with business dealings involving the plaintiff and the defendant.
If these accusations are proven to be correct, they point to a seemingly sophisticated plan to deceive business partners. Of course, there is always a presumption of innocence, in London’s High Court. Further, Mr. Flohr, through his lawyers, has insisted that the claims are “inaccurate and the claims made are obviously unfounded”.
Taking a step back, we are seeing a steady accretion of published articles, in the Financial Times and two articles in WirtschaftsWoche, concerning Vista Global and Thomas Flohr. Indeed, several of my own LinkedIn posts have highlighted longstanding concerns about the viability of VistaJet’s business model. It’s difficult not to surmise that smoke frequently foreshadows fire!
We could be witnessing the beginnings of a media feeding frenzy, involving Vista Global and their founder. Journalists appear to be focusing on two subjects, for now. Firstly, Thomas Flohr and his involvement with past and current businesses (Comdisco, Comprendium, Vista Global). Secondly, the financial fortunes of Vista Global, a company that appears to be weighed-down by high levels of debt, rising interest expenses, mounting liabilities associated with unsecured service pre-payments and a charter market in which flight hours and hourly revenues are facing downward pressure.
In addition to monitoring the progress of this lawsuit, I will continue to monitor the media for additional stories concerning Vista Global, their founder and the subsidiaries they own.
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from linkedIn: Vista Global, Thomas Flohr, A Nigerian Businessman & A Los Angeles Mansion (Wirtschafts Woche)
The attached article offers additional “insights” into Vista Global’s founder, Thomas Flohr (TF).
This article highlights a business relationship between TF and a Nigerian businessman, Kolawole Akanni Aluko (KA). It would seem that a verbal agreement between TF and KA resulted in the Nigerian businessman flying on the VistaJet fleet, apparently in return for a luxurious property, in Los Angeles. To be clear, counter-trade isn’t uncommon. However, in this case, there were intermediary companies involved, in addition to KA, whose reputation has been called into question. Further, this transaction attracted the attention of the FBI, who expressed “concerns” about an “international conspiracy” and “illegal activity” surrounding this property.
As far as I can determine, KA was provided with unfettered access to a Global 6000 that was reportedly controlled by a TF-owned company, Ness Trading & Invest. Curiously, according to the WirtschaftsWoche report, this company doesn’t appear to own or manage any aircraft. Nevertheless, KA was allowed to fly millions of dollars worth of hours onboard VistaJet aircraft.
As flight hours, and the associated costs, accumulated, TF and KA agreed that a property would be transferred to a TF-owned company, as payment for the flights. Again, nothing appears to be improper.
The story takes several unexpected turns. Firstly, the Nigerian businessman has become embroiled in accusations of wrongdoing, involving Nigerian oil. The FBI also suspected that something was amiss, and attempted to repossess the Los Angeles property, alleging that the purchase transaction fell short of being entirely legal.
Eventually, TF agreed to a settlement, paying the US government $16 million in return for the FBI dropping their lawsuit. Unanswered questions remain. Did TF's company, Ness Trading & Invest, actually own or manage a Global 6000? If not, were VistaJet compensated for the tens of millions of dollars in flight services they provided, to KA. If not, I could see several parties, including the IRS, taking an interest in this arrangement, though I am by no means an expert on such matters.
I recently published a post reporting a UK lawsuit that was filed against Thomas Flohr. Here’s my overarching concern. Vista Global depend upon their reputation when dealing with corporations and the high net-worth community. When suggestions of impropriety emerge, they call into question the reputation of Vista Global’s founder and high-profile CEO. In a market where customers are making six and seven figure unsecured pre-payments, reputation is a potent commodity.
My hope is that we won’t be seeing further reports that cast aspersions at TF and his business practices…and that the existing rumors, mentioned in both these reports, prove to be unfounded.
My former marketing professor once offered a marketing axiom:
“Those who live by PR often die by PR!”.
The attached article offers additional “insights” into Vista Global’s founder, Thomas Flohr (TF).
This article highlights a business relationship between TF and a Nigerian businessman, Kolawole Akanni Aluko (KA). It would seem that a verbal agreement between TF and KA resulted in the Nigerian businessman flying on the VistaJet fleet, apparently in return for a luxurious property, in Los Angeles. To be clear, counter-trade isn’t uncommon. However, in this case, there were intermediary companies involved, in addition to KA, whose reputation has been called into question. Further, this transaction attracted the attention of the FBI, who expressed “concerns” about an “international conspiracy” and “illegal activity” surrounding this property.
As far as I can determine, KA was provided with unfettered access to a Global 6000 that was reportedly controlled by a TF-owned company, Ness Trading & Invest. Curiously, according to the WirtschaftsWoche report, this company doesn’t appear to own or manage any aircraft. Nevertheless, KA was allowed to fly millions of dollars worth of hours onboard VistaJet aircraft.
As flight hours, and the associated costs, accumulated, TF and KA agreed that a property would be transferred to a TF-owned company, as payment for the flights. Again, nothing appears to be improper.
The story takes several unexpected turns. Firstly, the Nigerian businessman has become embroiled in accusations of wrongdoing, involving Nigerian oil. The FBI also suspected that something was amiss, and attempted to repossess the Los Angeles property, alleging that the purchase transaction fell short of being entirely legal.
Eventually, TF agreed to a settlement, paying the US government $16 million in return for the FBI dropping their lawsuit. Unanswered questions remain. Did TF's company, Ness Trading & Invest, actually own or manage a Global 6000? If not, were VistaJet compensated for the tens of millions of dollars in flight services they provided, to KA. If not, I could see several parties, including the IRS, taking an interest in this arrangement, though I am by no means an expert on such matters.
I recently published a post reporting a UK lawsuit that was filed against Thomas Flohr. Here’s my overarching concern. Vista Global depend upon their reputation when dealing with corporations and the high net-worth community. When suggestions of impropriety emerge, they call into question the reputation of Vista Global’s founder and high-profile CEO. In a market where customers are making six and seven figure unsecured pre-payments, reputation is a potent commodity.
My hope is that we won’t be seeing further reports that cast aspersions at TF and his business practices…and that the existing rumors, mentioned in both these reports, prove to be unfounded.
My former marketing professor once offered a marketing axiom:
“Those who live by PR often die by PR!”.
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Thomas Flohr: Schlappe vor Gericht für den Privatjet-König (wiwo.de)
A defeat in court for the private jet king
by Volker ter Haseborg
November 13, 2023
Private jet king Thomas Flohr Source: Bloomberg
Private jet king Thomas Flohr
Picture: Bloomberg
Thomas Flohr wanted to have a fraud claim dismissed - but the London judge refused for the time being. Now the trial continues. A former business associate is demanding 58 million euros from the Vistajet boss.
Thomas Flohr, owner of luxury airline VistaJet, must continue to fight an attempt to claim that he defrauded a Guernsey investment partnership two decades ago after London’s High Court refused to dismiss the current breach of contract case against him. Flohr, who denies the allegations, had tried to have the case thrown out on technical grounds related to the circumstances of the case, in which a previously dissolved partnership was resurrected in 2021 in order to file the suit. Frontiers Capital initially sued for breach of contract in 2021 but filed an amended claim in December last year, alleging deceit, claiming that a source of the Swiss entrepreneur’s fortune involved “fraudulent misrepresentation” in which he “set up, controlled, and kept hidden from [the investment partnership] a parallel structure” of companies. The court has not yet ruled on whether the claim can be amended in this way, or the substance of the case. Flohr has opposed the amendment. A further hearing is scheduled for March 6 to 8 next year. In advance of this, further summary judgment and strike out arguments will be heard on whether Frontiers Capital has the authority to bring the claim, which may lead to the case being thrown out. The legal setback comes as Flohr faces questions over his debt-laden airline and about hundreds of millions of dollars of payments made by Vista to a separate Flohr-owned entity as it built one of the world’s largest fleets of private jets. The civil suit is spearheaded by the investor Timothy Horlick who oversaw the Guernsey partnership, Frontiers Capital, which in 2002 invested £7.5mn in a UK document management business chaired by Flohr called Comprendium. According to the judgment, which was published on Monday, Frontiers Capital alleges that “in breach of duty, Mr Flohr caused a series of other companies containing the name Comprendium to be incorporated”. Frontiers is seeking damages and costs. Frontiers’ amended claim alleges that Flohr secretly used these parallel companies in Switzerland and Germany to buy assets from his bankrupt former employer, the US IT equipment leasing group Comdisco, in breach of his duties to Comprendium UK and “in one instance for a profit of €93mn”. Frontiers Capital also claims that Flohr reneged on an assurance to Horlick that if he bought certain Comdisco assets “he would secure revenue for Comprendium UK of between €10mn and €20mn per annum”. Comprendium UK eventually failed and Frontiers Capital was dissolved in 2010, losing its investment and a further £5mn lent to the company. While such civil claims must usually be filed within six years, the claimant alleges that critical elements were “deliberately concealed” by Flohr, meaning the clock did not start until the partnership was resurrected. Monday’s judgment, by Master James Brightwell, said “it would be an understatement to say that the defendant strenuously denies the allegation”, and that the decision to proceed was concerned with technical aspects of law regarding the way the partnership was dissolved. The judgment said that at a “fractious hearing” in July, the High Court also considered questions of confidentiality “in respect of allegations said to be both scandalous and irrelevant” by the defence. After Comprendium failed, Flohr went on to build an airline with the world’s fastest business jets and a super-rich clientele. VistaJet also has more than $4bn of debt, and auditor EY warned in its opinion on the 2022 accounts that “a material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern”. Flohr responded to that opinion by saying the business was highly profitable on the basis of earnings before interest, tax, depreciation and amortisation; that net losses were a consequence of conservative accounting of non-cash items such as depreciation; and pointed to the group’s ability to raise a new $500mn bond from investors as a sign of their confidence. This article has been revised to clarify details regarding the court’s judgment.
VistaJet owner Thomas Flohr loses a bid to strike out historic legal claim (ft.com)
A defeat in court for the private jet king
by Volker ter Haseborg
November 13, 2023
Private jet king Thomas Flohr Source: Bloomberg
Private jet king Thomas Flohr
Picture: Bloomberg
Thomas Flohr wanted to have a fraud claim dismissed - but the London judge refused for the time being. Now the trial continues. A former business associate is demanding 58 million euros from the Vistajet boss.
VistaJet owner Thomas Flohr loses a bid to strike out historic legal claim
Guernsey investment partnership alleges fraud two decades ago before entrepreneur launched luxury airlineThomas Flohr, owner of luxury airline VistaJet, must continue to fight an attempt to claim that he defrauded a Guernsey investment partnership two decades ago after London’s High Court refused to dismiss the current breach of contract case against him. Flohr, who denies the allegations, had tried to have the case thrown out on technical grounds related to the circumstances of the case, in which a previously dissolved partnership was resurrected in 2021 in order to file the suit. Frontiers Capital initially sued for breach of contract in 2021 but filed an amended claim in December last year, alleging deceit, claiming that a source of the Swiss entrepreneur’s fortune involved “fraudulent misrepresentation” in which he “set up, controlled, and kept hidden from [the investment partnership] a parallel structure” of companies. The court has not yet ruled on whether the claim can be amended in this way, or the substance of the case. Flohr has opposed the amendment. A further hearing is scheduled for March 6 to 8 next year. In advance of this, further summary judgment and strike out arguments will be heard on whether Frontiers Capital has the authority to bring the claim, which may lead to the case being thrown out. The legal setback comes as Flohr faces questions over his debt-laden airline and about hundreds of millions of dollars of payments made by Vista to a separate Flohr-owned entity as it built one of the world’s largest fleets of private jets. The civil suit is spearheaded by the investor Timothy Horlick who oversaw the Guernsey partnership, Frontiers Capital, which in 2002 invested £7.5mn in a UK document management business chaired by Flohr called Comprendium. According to the judgment, which was published on Monday, Frontiers Capital alleges that “in breach of duty, Mr Flohr caused a series of other companies containing the name Comprendium to be incorporated”. Frontiers is seeking damages and costs. Frontiers’ amended claim alleges that Flohr secretly used these parallel companies in Switzerland and Germany to buy assets from his bankrupt former employer, the US IT equipment leasing group Comdisco, in breach of his duties to Comprendium UK and “in one instance for a profit of €93mn”. Frontiers Capital also claims that Flohr reneged on an assurance to Horlick that if he bought certain Comdisco assets “he would secure revenue for Comprendium UK of between €10mn and €20mn per annum”. Comprendium UK eventually failed and Frontiers Capital was dissolved in 2010, losing its investment and a further £5mn lent to the company. While such civil claims must usually be filed within six years, the claimant alleges that critical elements were “deliberately concealed” by Flohr, meaning the clock did not start until the partnership was resurrected. Monday’s judgment, by Master James Brightwell, said “it would be an understatement to say that the defendant strenuously denies the allegation”, and that the decision to proceed was concerned with technical aspects of law regarding the way the partnership was dissolved. The judgment said that at a “fractious hearing” in July, the High Court also considered questions of confidentiality “in respect of allegations said to be both scandalous and irrelevant” by the defence. After Comprendium failed, Flohr went on to build an airline with the world’s fastest business jets and a super-rich clientele. VistaJet also has more than $4bn of debt, and auditor EY warned in its opinion on the 2022 accounts that “a material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern”. Flohr responded to that opinion by saying the business was highly profitable on the basis of earnings before interest, tax, depreciation and amortisation; that net losses were a consequence of conservative accounting of non-cash items such as depreciation; and pointed to the group’s ability to raise a new $500mn bond from investors as a sign of their confidence. This article has been revised to clarify details regarding the court’s judgment.
VistaJet owner Thomas Flohr loses a bid to strike out historic legal claim (ft.com)
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This time on the Wall Street Journal, article posted today
https://www.wsj.com/finance/vista-gl...
https://www.wsj.com/finance/vista-gl...
- How One Debt-Laden Company Could Create a Storm for Private Jets
- VistaJet’s big pandemic expansion now looks overstretched, posing a risk for Canadian plane maker Bombardier
- Investors are getting increasingly worried: A VistaJet bond issued last May, which was very oversubscribed, is now selling off. On Friday, its yield closed at 17.23%, the highest on record. This means a price of 77 cents on the dollar and a spread over Treasury yields of 13.18 percentage points. Ratings companies haven’t downgraded the bonds, which have a B-minus sub-investment grade. But only 9% of securities in that category trade at spreads above 10 percentage points, the typical threshold for distress, S&P Global Market Intelligence data shows.
- Its net debt increased to an eye-watering 23.5 times equity, up from 7.8 times a year earlier.
- VistaJet’s rapid growth was facilitated by state-backed guarantees. EDC’s transactions with VistaJet amounted to at least 1.7 billion Canadian dollars, equivalent to around $1.3 billion, between 2020 and 2022 alone, official data shows.
- Operating cash flow in 2022 amounted to just 16% of the company’s debts at the end of that year. Meanwhile, soaring bond yields will likely push up the cost of refinancing. A $150 million bond matures this June.
- Were VistaJet to sell some of its Bombardier jets to reduce debt, it would put pressure on used prices. If, in the worst case, the company suddenly collapsed, the impact on the market could be nearly unprecedented.
- Bombardier makes high margins on these premium planes and could struggle to sell new ones if used prices tumble
This time on the Wall Street Journal, article posted today
https://www.wsj.com/finance/vista-gl...
https://www.wsj.com/finance/vista-gl...
- How One Debt-Laden Company Could Create a Storm for Private Jets
- VistaJet’s big pandemic expansion now looks overstretched, posing a risk for Canadian plane maker Bombardier
- Investors are getting increasingly worried: A VistaJet bond issued last May, which was very oversubscribed, is now selling off. On Friday, its yield closed at 17.23%, the highest on record. This means a price of 77 cents on the dollar and a spread over Treasury yields of 13.18 percentage points. Ratings companies haven’t downgraded the bonds, which have a B-minus sub-investment grade. But only 9% of securities in that category trade at spreads above 10 percentage points, the typical threshold for distress, S&P Global Market Intelligence data shows.
- Its net debt increased to an eye-watering 23.5 times equity, up from 7.8 times a year earlier.
- VistaJet’s rapid growth was facilitated by state-backed guarantees. EDC’s transactions with VistaJet amounted to at least 1.7 billion Canadian dollars, equivalent to around $1.3 billion, between 2020 and 2022 alone, official data shows.
- Operating cash flow in 2022 amounted to just 16% of the company’s debts at the end of that year. Meanwhile, soaring bond yields will likely push up the cost of refinancing. A $150 million bond matures this June.
- Were VistaJet to sell some of its Bombardier jets to reduce debt, it would put pressure on used prices. If, in the worst case, the company suddenly collapsed, the impact on the market could be nearly unprecedented.
- Bombardier makes high margins on these premium planes and could struggle to sell new ones if used prices tumble
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Michael Riegel DipM BSc MSc MBAView Michael Riegel DipM BSc MSc MBA’s profile
Business Aviation Publisher, Market Analyst, Business Jet Designer & Consumer AdvocateVista Global Q3 2023 Earnings In Review
Vista Global (VG) financial statements aren’t widely published. However, I understand that Q3 2023 numbers are readily available. I wanted to share some insights and personal opinions.
During Q3 2023 VG revenues fell by 2.5% YoY. The company operates a dedicated fleet of 268 aircraft, down one aircraft YoY. VG’s managed fleet dropped from 93 to 75 aircraft, or 19%. I suspect this shrinkage results from charter customers moving into the VistaJet program, with flight hours migrating from managed to dedicated aircraft. VG’s reported growth in program hours may well reflect internal revenue transfer, rather than any surge in new business. Having reviewed VistaJet agreements, for my clients, users sign a three-year agreement that requires annual pre-payments. However, contracts can be terminated by paying a modest exit penalty, at the end of each year. VistaJet contracts lack the long-term capital and revenue guarantees enjoyed with NetJets shares. Further, NetJets assume very little debt or residual value risk, compared to VG.
Dedicated aircraft utilization rose from 813 to 834 annualized hours, far below the 1,250 target utilization quoted in VG’s 2023 $500 million bond prospectus. Deadhead increased from 30% to 31.7%, YoY, indicating declining fleet efficiency. VG aircraft appear to be averaging less than 570 revenue hours per annum, which isn’t nearly enough to allow their dedicated fleet of super midsize, large and ultra long-range jets to generate a profit, IMHO.
Let’s address free cash flow. Q3 2023 financial statements detail “diluted yield” of $10,500 per hour. I take this to mean VG's average net charter income per hour. VG also detail $4,200 in “variable DOCs per hour”. These numbers convert into hourly direct costs of 40% of hourly revenues. If my interpretation is correct, VG’s $949.4 million in deferred revenue, which represents pre-paid but un-flown hours, should cost roughly $380 million to fly. I see $276 million in available cash! Further, my go-to financial analyst estimates that VG consumed more than $80 million per month, between Q1 and the end of Q3 2023. I see frequent mentions of EBITDA, among quotes from VG leadership, a number that excludes major cash outflows that render this metric misleading, IMHO. I prefer simpler measures of financial performance, like free cash flow. Despite receiving $949.4 million in pre-paid revenues, $500 million from a 2023 bond issue, a $60 million draw-down against a $200 million revolving line of credit and $57.5 million from refinancing dedicated aircraft, VG seem to be consuming cash faster than it can be replaced. Once Q4 2023 results emerge, I'll post an update. Based upon these Q3 2023 numbers, I am struggling to find much that's positive in these results.
As always, I invite feedback from Vista Global, if I have made any significant errors in my interpretation of their financial statements. I will happily correct or retract any inaccuracies.
Michael Riegel DipM BSc MSc MBAView Michael Riegel DipM BSc MSc MBA’s profile
Business Aviation Publisher, Market Analyst, Business Jet Designer & Consumer AdvocateVista Global Q3 2023 Earnings In Review
Vista Global (VG) financial statements aren’t widely published. However, I understand that Q3 2023 numbers are readily available. I wanted to share some insights and personal opinions.
During Q3 2023 VG revenues fell by 2.5% YoY. The company operates a dedicated fleet of 268 aircraft, down one aircraft YoY. VG’s managed fleet dropped from 93 to 75 aircraft, or 19%. I suspect this shrinkage results from charter customers moving into the VistaJet program, with flight hours migrating from managed to dedicated aircraft. VG’s reported growth in program hours may well reflect internal revenue transfer, rather than any surge in new business. Having reviewed VistaJet agreements, for my clients, users sign a three-year agreement that requires annual pre-payments. However, contracts can be terminated by paying a modest exit penalty, at the end of each year. VistaJet contracts lack the long-term capital and revenue guarantees enjoyed with NetJets shares. Further, NetJets assume very little debt or residual value risk, compared to VG.
Dedicated aircraft utilization rose from 813 to 834 annualized hours, far below the 1,250 target utilization quoted in VG’s 2023 $500 million bond prospectus. Deadhead increased from 30% to 31.7%, YoY, indicating declining fleet efficiency. VG aircraft appear to be averaging less than 570 revenue hours per annum, which isn’t nearly enough to allow their dedicated fleet of super midsize, large and ultra long-range jets to generate a profit, IMHO.
Let’s address free cash flow. Q3 2023 financial statements detail “diluted yield” of $10,500 per hour. I take this to mean VG's average net charter income per hour. VG also detail $4,200 in “variable DOCs per hour”. These numbers convert into hourly direct costs of 40% of hourly revenues. If my interpretation is correct, VG’s $949.4 million in deferred revenue, which represents pre-paid but un-flown hours, should cost roughly $380 million to fly. I see $276 million in available cash! Further, my go-to financial analyst estimates that VG consumed more than $80 million per month, between Q1 and the end of Q3 2023. I see frequent mentions of EBITDA, among quotes from VG leadership, a number that excludes major cash outflows that render this metric misleading, IMHO. I prefer simpler measures of financial performance, like free cash flow. Despite receiving $949.4 million in pre-paid revenues, $500 million from a 2023 bond issue, a $60 million draw-down against a $200 million revolving line of credit and $57.5 million from refinancing dedicated aircraft, VG seem to be consuming cash faster than it can be replaced. Once Q4 2023 results emerge, I'll post an update. Based upon these Q3 2023 numbers, I am struggling to find much that's positive in these results.
As always, I invite feedback from Vista Global, if I have made any significant errors in my interpretation of their financial statements. I will happily correct or retract any inaccuracies.
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any tips on what to expect on the assesment? doea anybody know the 20 Atpl questions?
Maybe it's attractive Bombardier typ ratings and worldwide flying experience which increases your market value? Plenty of former VJ pilots flying for TAG, JA etc which usually require a type rating and time on type. Others may just be contend and stick around.
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Witschafts Woche The private jet king´s problem numbers, Feb.12. 2024
Vista Global - An Interesting Investigative Report by Melanie Bergemann, Philipp Frphnn and Volker ter Hasborg (c) reposted from LinkedIn
Attached is an article just published by German publication, Wirtschafts Woche, which is owned by Handelsblatt Media Group, about Vista Global (Vista). I was intrigued by several comments in this article.
Bond Performance & Interest Rates
Among the subjects covered are rising interest rates and less than stellar performance for the $500 million bond that Vista issued in May 2023. Apparently, the bond has been trading at 83%, while the yield has risen to 15%. My financial sources suggest that these numbers, along with a B- Standard & Poor’s rating, may well be cause for concern among bond traders and investors. This bond is costing Vista 9.5% per annum, significantly above the rates (coupon) being paid by less risky issuers, according to the authors.
Interest rates, which remained at record lows while Vista were taking delivery of new Bombardier jets, have risen, sharply. Vista now face the reality that the cost of servicing their debt is on the rise, while charter demand and hourly revenue are under downward pressure, industry-wide. Indeed, Vista have shifted capital investment away from new aircraft and into refurbishing older jets.
Rumors & Investigations
There is mention of a UK lawsuit, alleging fraud by Thomas Flohr, a statement from EY expressing “significant doubts about the group’s ability to continue as a going concern”, the past failure of Jetsmarter and a now-shuttered SEC investigation. In an industry that relies upon consumer and lender confidence, I imagine it’s becoming difficult to argue that these problems, especially the UK lawsuit, are helping Vista.
Vista strenuously deny that their financial fortunes are anything but extremely positive. Further, they insist that recent articles, lawsuits and investigations are without merit, or are considered irrelevant by Vista stakeholders.
When I advise my clients, I focus on financial performance and data I can analyze and assess, objectively, free from the influence of media articles or corporate spin. My concerns about Vista cash consumption, low aircraft productivity and balance sheet liabilities remain unchanged, but are based upon cold, hard numbers, not media outlets, lawsuits or past investigations.
In a recent AIN article, Thomas Flour stated that, “2023 was another year of successful performance in our business. Despite having to react to deep economic shifts and complex geopolitical uncertainty, we produced double digit growth across all markets—achieved whilst refurbishing and upgrading our fleet ahead of schedule, further improving our service standards and significantly increasing aircraft availability”. While Mr. Flohr offered few operational metrics or financial specifics, his assessment seems positive.
To be blunt, I have struggled to reconcile Mr. Flohr’s bullish statement with Vista’s Q3 2023 financial statements. Hopefully, I will reconsider my assessment when full-year numbers become available, next month.
Attached is an article just published by German publication, Wirtschafts Woche, which is owned by Handelsblatt Media Group, about Vista Global (Vista). I was intrigued by several comments in this article.
Bond Performance & Interest Rates
Among the subjects covered are rising interest rates and less than stellar performance for the $500 million bond that Vista issued in May 2023. Apparently, the bond has been trading at 83%, while the yield has risen to 15%. My financial sources suggest that these numbers, along with a B- Standard & Poor’s rating, may well be cause for concern among bond traders and investors. This bond is costing Vista 9.5% per annum, significantly above the rates (coupon) being paid by less risky issuers, according to the authors.
Interest rates, which remained at record lows while Vista were taking delivery of new Bombardier jets, have risen, sharply. Vista now face the reality that the cost of servicing their debt is on the rise, while charter demand and hourly revenue are under downward pressure, industry-wide. Indeed, Vista have shifted capital investment away from new aircraft and into refurbishing older jets.
Rumors & Investigations
There is mention of a UK lawsuit, alleging fraud by Thomas Flohr, a statement from EY expressing “significant doubts about the group’s ability to continue as a going concern”, the past failure of Jetsmarter and a now-shuttered SEC investigation. In an industry that relies upon consumer and lender confidence, I imagine it’s becoming difficult to argue that these problems, especially the UK lawsuit, are helping Vista.
Vista strenuously deny that their financial fortunes are anything but extremely positive. Further, they insist that recent articles, lawsuits and investigations are without merit, or are considered irrelevant by Vista stakeholders.
When I advise my clients, I focus on financial performance and data I can analyze and assess, objectively, free from the influence of media articles or corporate spin. My concerns about Vista cash consumption, low aircraft productivity and balance sheet liabilities remain unchanged, but are based upon cold, hard numbers, not media outlets, lawsuits or past investigations.
In a recent AIN article, Thomas Flour stated that, “2023 was another year of successful performance in our business. Despite having to react to deep economic shifts and complex geopolitical uncertainty, we produced double digit growth across all markets—achieved whilst refurbishing and upgrading our fleet ahead of schedule, further improving our service standards and significantly increasing aircraft availability”. While Mr. Flohr offered few operational metrics or financial specifics, his assessment seems positive.
To be blunt, I have struggled to reconcile Mr. Flohr’s bullish statement with Vista’s Q3 2023 financial statements. Hopefully, I will reconsider my assessment when full-year numbers become available, next month.
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WhatsApps, Fake Names and an Alleged Conspiracy Against VistaJet
- Thomas Flohr accuses private jet rival of smear campaign
- Financier Timothy Horlick and AirX founder deny claims
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By Sabah Meddings and Siddharth Vikram Philip
13. März 2024 at 16:01 MEZ
The owner of VistaJet, one of the world’s biggest private jet firms, has alleged in legal filings that a smaller rival and a prominent British financier launched a smear campaign against him.In a London High Court battle that involves allegations of covert codes, secret WhatsApp groups and a fake email address, Swiss entrepreneur Thomas Flohr claims that the AirX founder John Matthews and financier Timothy Horlick arranged to release confidential information about him with the intention of ruining his reputation and damaging his company, according to legal filings.
VistaJet Group Holding Ltd. and AirX operate in similar markets, and Flohr alleges harmful information about him was sent to an audience selected to have the “maximum likelihood of damaging” his reputation and business interests, according to the skeleton argument submitted in court on March 6. Both Horlick and Matthews deny this.
Flohr claims that Matthews used a burner email address with a fabricated identity to send emails with information, that a court had ordered to be kept confidential, to business contacts of VistaJet. These allegedly included Bombardier Inc. and Export Development Canada, one of VistaJet’s aircraft finance institutions.
He further alleges that Matthews created a WhatsApp group in March last year, titled VistaComms, which was allegedly used to discuss with colleagues how to use burner emails to share confidential information about VistaJet with parties including lenders, business partners and journalists.
The aim, according to the WhatsApp messages submitted to the court — which Flohr’s lawyers said were released to him by a whistleblower — was to harm the interests of Flohr, and to benefit from VistaJet’s potential demise. Matthews would benefit from VistaJet’s failure by increasing AirX’s rates and scooping up planes if VistaJet collapsed, according to a series of WhatsApp messages between March 2023 and February 2024 filed in court.
VistaJet was founded by the 63-year-old Flohr two decades ago, and offers customers subscriptions to its planes, as an alternative to owning their own aircraft. AirX, which according to its website is majority-owned by British entrepreneur Matthews, is a much smaller Malta-based outfit that allows customers to charter planes.
The allegations are the latest twist in a London High Court battle between between Horlick and Flohr over allegations Flohr defrauded a Guernsey investment partnership two decades ago. In the case, Horlick has accused Flohr of hiding assets when the pair were in a Guernsey investment partnership in the early 2000s, meaning Flohr avoided triggering a further payout. Flohr has denied these allegations, and has sought to have the claim struck out.
‘No Digital History’
Through his lawyers The Khan Partnership, Horlick expressly denied passing on any materials subject to confidentiality orders. The Khan Partnership said the claims were a distraction from the ongoing court proceedings against Flohr.Lawyers for Matthews said: “Air X and Mr. Matthews vigorously deny the allegations of conspiracy made against them.” They also pointed out that they weren’t a party to the proceedings and so weren’t in a position to comment further at this stage.
As part of the Guernsey case, a judge ruled that certain documents that Horlick wanted to introduce, that could be damaging to Flohr’s reputation, should remain confidential. The sharing of these documents is at the heart of the alleged smear campaign and Flohr’s lawyers alleged that Horlick had previously sought to make the information public to force the Swiss businessman to settle to protect his reputation, according to a court argument.
Flohr also alleged Matthews met Horlick over lunch, and spoke to him on the phone, shortly before Matthews allegedly circulated screen-shots from the embargoed witness statements.
“The conversations did not discuss, nor relate to anything concerning, Mr Matthews’ alleged later receipt of third-party witness statements,” Horlick’s lawyers said.
Horlick’s lawyers also questioned whether versions of the witness statements allegedly given to third parties were identical to the copies filed in the court — suggesting they may not be subject to the confidentiality order.
Matthews allegedly shared 10 screen-shots that were subject to court restrictions. “Make sure the attachments have no digital history,” WhatsApp messages in evidence appear to show Matthews saying to his employees.
In another message introduced in court, Matthews appears to say: “Today is an important day marking the release of the witness statements to all at Bombardier who hold an executive title.”
‘Covert Communication’
VistaJet has in recent years fueled its expansion with debt, using it to buy a fleet of brand new Bombardier Global 7500 planes, as well as smaller rivals Air Hamburg and Jet Edge, to more than double its fleet to 332 jets.There are messages filed in court that allege Matthews was receiving information from within Air Hamburg, the private aviation firm VistaJet bought in February 2022.
In one, sent on April 25, 2023, Matthews appeared to explain a code used to communicate with former Air Hamburg CEO Floris Helmers when sharing information. “Whenever I ask about the weather, if it’s cloudy there is nothing to report, when he says it’s sunny it’s a one-time view only with a document that will help the investigation,” he wrote in the WhatsApp message submitted as court evidence.
In an email to Bloomberg News, Helmers said he absolutely denied having used a code for sharing evidence. Helmers added that he had known Matthews for more than 10 years, and conversations between them had focused on industry trends such as aircraft valuations.
“As an ongoing employee of Vista, the assertion that I have been engaged in ‘covert communication’ is a bit perplexing and of course without merit,” he said.
— With assistance from Tiffany Tsoi, Katharine Gemmell, and Erin Hudson
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Mr Matthews attempting to smear a rival individual - really? The guy must have bigger balls than his own brain.
However, got to give it to him - he's managed to avoid his just deserts now for many years.
I'm never one to back Vista or Mr Flohr - but on this occasion.....lets hope the right side wins and the really ugly side of business aviation can be cast aside forever. Yuk!
However, got to give it to him - he's managed to avoid his just deserts now for many years.
I'm never one to back Vista or Mr Flohr - but on this occasion.....lets hope the right side wins and the really ugly side of business aviation can be cast aside forever. Yuk!
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Owners of Aviation businesses are by in large sociopathic manbabies who would happily kill puppies to get one over on the competition. This whole thing (on both sides) would appear to be entirely in character.