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Originally Posted by mothy1583
(Post 10354164)
I was having dinner tonight and the manager of the restaurant - local HK guy - knowing I'm a pilot, asked if buying tickets on HKA was a good idea. If people think an airline is in trouble and won't be around to fly them on their holiday, then they won't book flights and it becomes a self - fulfilling prophecy Regardless of the realities. HKA have to walk a fine line of selling confidence in their business without looking like they're trying too hard or bullsh**ing the public. Considering the top brass are jumping ship, finding the right front man might not be easy. Good luck to them.
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The financing of airlines is big business. Many tricks to get better values, better rates, returns etc.
You can google the Bond and the stories about CBD financing HKAs debt and expansion plans online. As you can see above, the bond face value went down, which means you can buy it on the market less than what it is worth, by up to 60% less, hence your 550 million has only cost you 220 million. The price of the Bonds tanked, only to recover after CBD Bank put aside 100 Billion RMB (15 Billion US$). Someone mentioned tricks to affect sales. Tickets are sold 3-6 months in advance, only 10% last minute. The busiest period of the year has been sold months in advance. The load factor will not be affected in the short term. Since CBD (The government of China) decided to step in and back HKA, they are not going anywhere. I would not be surprised if it was sold to another Chinese Company as an ongoing concern. Cathay has enough on its plate to worry about taking out a competitor with stupid rumours. The HX Los Angeles, and San Francisco Flights are not really a concern for CX, as it is a drop in the ocean. Beijing dictates many things anyway, and both companies are owned by Chinese money anyway, and will be completely Chinese at some point. You may get rebranded and a new logo on your tails because of this, but I cannot see HKA going. These rumours are tricks for much higher and more lucrative financing deals than ticket prices, and load factors. We just fly planes, in a protected and honest environment hence we are gullible and naive when it comes to financing. |
Originally Posted by hyg
(Post 10354268)
Heard from someone within the company that those guys aren't jumping ship, they were removed......
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Originally Posted by HFP
(Post 10354565)
We just fly planes, in a protected and honest environment hence we are gullible and naive when it comes to financing. |
The opaque machinations of the finance world are all well and good. This is now making headlines and public perception has people questioning whether they should buy tickets well in advance. Right or wrong, justified or not, "sentiment" plays a big part in today's world. HKA will have to work overtime on PR is all.
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Apparently the company is to make a statement on 20th Jan 2019.
Also, fuel companies at HKIA will stop providing credit this week. Salaries may not be paid on time this month. |
Originally Posted by mothy1583
(Post 10354629)
The opaque machinations of the finance world are all well and good. This is now making headlines and public perception has people questioning whether they should buy tickets well in advance. Right or wrong, justified or not, "sentiment" plays a big part in today's world. HKA will have to work overtime on PR is all.
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Originally Posted by unitedabx
(Post 10354649)
Apparently the company is to make a statement on 20th Jan 2019.
Also, fuel companies at HKIA will stop providing credit this week. Salaries may not be paid on time this month. |
Originally Posted by SW1
(Post 10354659)
Source? Or more rumours and fake news
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HKA does not rely on pax from HK for its business. Most pax come from Chinese Travel agencies. If you do a search online, you will find that the Chinese banks just pumped 15 billion US$ and just paid off all the Hainan debt to Airbus and Boeing.
So HKA is not going anywhere soon. Enough money for salaries, and fuel, and everything else as well. They also just paid their bill to CAE in relation to their simulators being delivered, so for a company about to go bust, you don't prioritise the payment of simulators and buildings. HKA had to open their books to ATLA and show that they are sustainable and profitable. The news on that front is that they have made an operating profit for the last three years and have the cash flow to sustain the operations for 6 months as required. This is a fact rather than a rumour, as it's a regulatory requirement. Their problem has been the expansion costs, and investment in buildings, simulators etc. This was taken care of by Hainan, and now it will be taken care of by the Chinese banks. Rumours are that after the Chinese New Year they will announce the sale to a Chinese company. I also have it on good authority that to prove that they are financially sound they are about to announce a Bonus to employees to boost morale. They did make a profit last year, and they are self sustainable operationally. They just over extended themselves with investments and asset purchases. Anyway what do I know. Perhaps the banks just pumped billions in it on Friday just for the heck of it. |
Originally Posted by johnpilot
(Post 10354683)
HKA does not rely on pax from HK for its business. Most pax come from Chinese Travel agencies. If you do a search online, you will find that the Chinese banks just pumped 15 billion US$ and just paid off all the Hainan debt to Airbus and Boeing.
So HKA is not going anywhere soon. Enough money for salaries, and fuel, and everything else as well. They also just paid their bill to CAE in relation to their simulators being delivered, so for a company about to go bust, you don't prioritise the payment of simulators and buildings. HKA had to open their books to ATLA and show that they are sustainable and profitable. The news on that front is that they have made an operating profit for the last three years and have the cash flow to sustain the operations for 6 months as required. This is a fact rather than a rumour, as it's a regulatory requirement. Their problem has been the expansion costs, and investment in buildings, simulators etc. This was taken care of by Hainan, and now it will be taken care of by the Chinese banks. Rumours are that after the Chinese New Year they will announce the sale to a Chinese company. I also have it on good authority that to prove that they are financially sound they are about to announce a Bonus to employees to boost morale. They did make a profit last year, and they are self sustainable operationally. They just over extended themselves with investments and asset purchases. Anyway what do I know. Perhaps the banks just pumped billions in it on Friday just for the heck of it. |
Okay United, if it makes you feel better till the 20th, it is going bust on the 20th. Let's see what you have to say on the 21st then, when it is still in business. I don't have a vested interest in the outcome as I am not working for them. A very good friend of mine, a man of immense integrity who is in management though, told me that OPS are normal and that they have paid off the debt with fresh money.
The money was given to them under direct orders of the Chinese government. The airline is a symbol of Chinese prosperity in the old colony. They will integrate it, into another mainland airline, thus it is one of theirs. It cannot fail, while Swire is doing well. Loss of face and all. As for the objections of the other carriers, all Chinese airlines are effectively state property, as are banks, thus nothing happens unless they have clear orders from the Boss and the party. Maybe you have better information than my friend. He was also baffled by the bail out, as he did not think that they would have survived in the western world. I would be interested to know though, how you know that their bookings have nosedived and yours gone up by 30%? How would you know that if you work for Cathay? Do you have a software which tracks, forward bookings for all competitor airlines? If you have access to such a software, could you point me in the right direction as it would be a very nice tool to have at my disposal. Usually such commercially sensitive information is difficult to find, so I am sure if you have access to such software I could make some money with it. TaTa |
Originally Posted by johnpilot
(Post 10354731)
Okay United, if it makes you feel better till the 20th, it is going bust on the 20th. Let's see what you have to say on the 21st then, when it is still in business. I don't have a vested interest in the outcome as I am not working for them. A very good friend of mine, a man of immense integrity who is in management though, told me that OPS are normal and that they have paid off the debt with fresh money.
The money was given to them under direct orders of the Chinese government. The airline is a symbol of Chinese prosperity in the old colony. They will integrate it, into another mainland airline, thus it is one of theirs. It cannot fail, while Swire is doing well. Loss of face and all. As for the objections of the other carriers, all Chinese airlines are effectively state property, as are banks, thus nothing happens unless they have clear orders from the Boss and the party. Maybe you have better information than my friend. He was also baffled by the bail out, as he did not think that they would have survived in the western world. I would be interested to know though, how you know that their bookings have nosedived and yours gone up by 30%? How would you know that if you work for Cathay? Do you have a software which tracks, forward bookings for all competitor airlines? If you have access to such a software, could you point me in the right direction as it would be a very nice tool to have at my disposal. Usually such commercially sensitive information is difficult to find, so I am sure if you have access to such software I could make some money with it. TaTa |
It’s interesting that a bailout has been “ordered” given that the “mainland government” owns a rather sizable stake in Cathay Pacific through Air China’s holding. But there is room for both and competition is healthy. Having recently flown on a regional flight I was actually very impressed with the service onboard. Very good considering tickets are essentially cheaper than staff travel. That’s the rub of course. The company can’t simultaneously be raking in massive profits and require billions in bailouts. To state otherwise is nonsensical. Clearly there is trouble. The injection of funds is probably just part of the latest round of stimulus. Maybe instilling a little confidence in HNA’s continued ability to succeed worldwide...I’m sure they must be in the “too big to fail” category. |
Originally Posted by tiredofstupidity
(Post 10355613)
It’s interesting that a bailout has been “ordered” given that the “mainland government” owns a rather sizable stake in Cathay Pacific through Air China’s holding. But there is room for both and competition is healthy. Having recently flown on a regional flight I was actually very impressed with the service onboard. Very good considering tickets are essentially cheaper than staff travel. That’s the rub of course. The company can’t simultaneously be raking in massive profits and require billions in bailouts. To state otherwise is nonsensical. Clearly there is trouble. The injection of funds is probably just part of the latest round of stimulus. Maybe instilling a little confidence in HNA’s continued ability to succeed worldwide...I’m sure they must be in the “too big to fail” category. Of course, the bailout guarantee might not be 100% fix at this point and some things may still be going in flux, otherwise the HK government won't be preparing contingency for HKA's failure: https://beta.scmp.com/news/hong-kong/transport/article/2181275/hong-kong-airlines-government-considers-contingency-plan The HK government may just be doing a "better be prepared", strategy, in case of HKA failure. But if a bailout is 100% certain, they would know and wouldn't be nervous and preparing contingency plans. That suggests a bailout plan is not a done deal at this point. |
The latest communique from the HKA CEO, [QUOTE]Letter sent on behalf of our Chairman) Dear colleagues, There have been many vicious attacks on Hong Kong Airlines lately. The groundless speculations about Hong Kong Airlines ceasing operation and applying for liquidation from companies like Blue Cross, travel agents and media are untrue and we reserve the right to take legal action against those who deliberately create these rumors. Hong Kong Airlines has built its success from the hard work that our staff have put in over the years. We have been and are still operating normally. While we have tasted the fruits of our people, we must continue to stay united as a team in times of unprecedented challenges and focus on delivering our best customer service. Each and every Hong Kong Airlines staff is all heart and cares for the company. Many of you have defended the airline rigorously when approached with difficult questions from people in your network and your efforts are greatly appreciated. As we try our best to address the pressing issues, I strongly urge our staff to remain calm and refrain from making comments on public domains. We must continue to adhere by our brand values and remain professional in the eyes of the public. I appreciate that many of you worked very hard over the Christmas and New Year holidays. You have united families and also brought festive cheer to many holidaymakers who flew with us during the peak travel season. Between 22 December 2018 and 1 January 2019, Hong Kong Airlines operated more than 1,200 flights and carried over 240,000 passengers. For the coming Chinese New Year holidays, we are expected to operate close to 1,080 flights and fly more than 224,000 passengers between 1 and 10 February 2019. Let’s continue to work as a team and create many memorable experiences for our customers heading home for reunion or spending quality time together as a family during this important Chinese holiday. I would also like to share with you that Hong Kong Airlines has been named by OAG as the most punctual airline in Asia Pacific and third most punctual in the world for 2018. We have maintained this accolade because of the ongoing efforts and collaborative teamwork led by our operations team. Congratulations and well done to everyone involved. Let me reiterate once again that Hong Kong Airlines is here to stay. We are proud to be one of Hong Kong’s home carriers and remain committed to sustaining our long term growth. To do that, we must continue to work hard and stay united as one team in the face of adversity. Stay tough and keep our heads high so that we can achieve greater success for Hong Kong Airlines. Sincerely, Hou Wei Chairman [/QUOTE where there's smoke, there's fire |
Originally Posted by HFP
(Post 10354565)
The financing of airlines is big business. Many tricks to get better values, better rates, returns etc.
You can google the Bond and the stories about CBD financing HKAs debt and expansion plans online. As you can see above, the bond face value went down, which means you can buy it on the market less than what it is worth, by up to 60% less, hence your 550 million has only cost you 220 million. The price of the Bonds tanked, only to recover after CBD Bank put aside 100 Billion RMB (15 Billion US$). Someone mentioned tricks to affect sales. Tickets are sold 3-6 months in advance, only 10% last minute. The busiest period of the year has been sold months in advance. The load factor will not be affected in the short term. Since CBD (The government of China) decided to step in and back HKA, they are not going anywhere. I would not be surprised if it was sold to another Chinese Company as an ongoing concern. Cathay has enough on its plate to worry about taking out a competitor with stupid rumours. The HX Los Angeles, and San Francisco Flights are not really a concern for CX, as it is a drop in the ocean. Beijing dictates many things anyway, and both companies are owned by Chinese money anyway, and will be completely Chinese at some point. You may get rebranded and a new logo on your tails because of this, but I cannot see HKA going. These rumours are tricks for much higher and more lucrative financing deals than ticket prices, and load factors. We just fly planes, in a protected and honest environment hence we are gullible and naive when it comes to financing. |
latest press release [ https://www.hongkongairlines.com/en_...005567007_269# ]
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These platitudes were the same kind of commitment that Monarch management put out to employees in 2017. Enough said. Believe what you may, but Ka are recruiting rated FOs , no bonds and a secure future ( relatively speaking) |
The fact that they put out a notice discounting the rumours is very worrying. I don’t work for HKA, but over at CPA, when management comes out and says something, the complete opposite ends up being the real story. Good luck boys and girls. I certainly would bet money in the situation either way. The China that bailed out all carriers in 2008 is very different today. |
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