What's happening in CHC?
helimutt, my rebuttal was not meant to be an attack on your poor education.
My response was driven by a desire to protect the great pilots I have the privilege of working alongside from the unnecessary stresses your speculative post could cause. The pilots in Aberdeen and Denes went through some pretty crap times this year and don't need some
implying it is about to be repeated.
So before you make similar posts, please think about the impact your message can have on others.
My response was driven by a desire to protect the great pilots I have the privilege of working alongside from the unnecessary stresses your speculative post could cause. The pilots in Aberdeen and Denes went through some pretty crap times this year and don't need some
implying it is about to be repeated.So before you make similar posts, please think about the impact your message can have on others.
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VL well said and if you read the transcripts from the last CHC investors meeting the new boss seems to be making some healthy positive changes. I just hope the oil price doesn't defeat his efforts.
Best Regards
DB
Best Regards
DB
The old adage that O&G contracts are actually, in essence, only a rolling 3-month contract and not really worth the paper they're written on, needs to be kept at the forefront of your mind on a shItty night approach just to keep you on your toes.
Good to see HeliOffshore not even looking at that side of the house........
If you find yourself in receipt of redundancy - count your blessings - and find a career where you're skills and experience are valued not costed.
Good to see HeliOffshore not even looking at that side of the house........
If you find yourself in receipt of redundancy - count your blessings - and find a career where you're skills and experience are valued not costed.
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Monty Python
"Work 29 hours a day down mill then pay mill owner to come to work"
Never Fretter - this is a pretty good description of most Low Cost Airlines is it not?
Trog.
Never Fretter - this is a pretty good description of most Low Cost Airlines is it not?
Trog.
I see the people who took CHC's Mozambique contract are already bleeding pilots.... Advertising for multiple crew positions in this market is not a positive sign for how well they treat their people or the conditions they operate under. It strikes me that they either never had the required number of people or those they did have would rather be unemployed than at Inaer in this market. Both of these things say a lot.
INAER, líder global en servicios aéreos de emergencia y mantenimiento de aeronaves
INAER, líder global en servicios aéreos de emergencia y mantenimiento de aeronaves
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Second round of redundancies coming for the offshore touring engineers pool in Australia this year.
Customer no longer requires the services of two helicopters so Chc no longer requires the services of 18 engineers.
The number seems a bit excessive for the loss of two airframes.
Customer no longer requires the services of two helicopters so Chc no longer requires the services of 18 engineers.
The number seems a bit excessive for the loss of two airframes.
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Use your Checklist, Charlie
1. Loss of contract(s) ......... Yes
2. Check headcount ........ Above Required
A. Any work on the horizon ........ Unlikely
B. Check cash flow. ...............Bleeding heavily
3. HR button ............. Engage
Considerations: as a pre-caution check office staff headcount is reduced proportionally
1. Loss of contract(s) ......... Yes
2. Check headcount ........ Above Required
A. Any work on the horizon ........ Unlikely
B. Check cash flow. ...............Bleeding heavily
3. HR button ............. Engage
Considerations: as a pre-caution check office staff headcount is reduced proportionally
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Who would have thought laying off front line employees and revenue producers while hiring more Senior Vice Presidents, Consultants, Analysts and professional schedulers would have a negative impact on business?!?!
CHC was in trouble long before the price of oil came down, $50/barrel was just the straw that broke the camels back.
CHC was in trouble long before the price of oil came down, $50/barrel was just the straw that broke the camels back.
So at today's price of .292, a share will now be worth about $9. But the market capitalization of the company will remain the same at 25m. Thought it had to be over 50m to stay listed on NYSE.
I need nowherespecial or pittsextra to make sense of this for me. Why is it important to stay listed? Chapter 11 implications?
I need nowherespecial or pittsextra to make sense of this for me. Why is it important to stay listed? Chapter 11 implications?
Malabo, thanks for the shout!
This is the number we were waiting for for compliance with NYSE rules. The minimum share value (as I got wrong before before everyone enjoys reminding me) is $1 so taking it up to $9 should provide plenty of leeway. If it crashes down to lower than a dollar from there I think the game is well and truly up. I think the NYSE valuation model requires $40m not $50m but not sure if CHC is a domestic company (registered in Grand Cayman after all) or classified as foreign which is either $60m or $100m. Either way, the valuation is difficult.
In terms of staying listed, I think that the listing of CHC was done by CD&R to fulfil their last remaining investment objective with the business. Keeping it listed makes almost no sense today, it's just dragging CHC's name through the mud in public. We have to think of the way finance people think to understand why listing is important but in essence it's a good way to recover their original investment money. There are more stringent rules financially for publically traded companies so in theory it might be easier for CD&R to buy CHC outright and de-list but that would require pouring good money after badly invested money so why would they do that?
In terms of insolvency (you mention Ch 11), that in theory happens when one of 2 things happen. You either run out of cash reserves or your total liabilities exceed the value of your company. CHC is sailing close to the wind on both for sure. What filing for Chapter 11 would do is in theory allow protection from creditors (ie people to whom CHC owe money to) while they sort out their business and find a viable model to proceed with. A by product of CH 11 proceedings is usually a huge haircut for the creditors (maybe they get back 30c on the $ for example). This would be an absolutely brilliant way to get CHC out of the mud where it is now as what is crippling CHC is centrally held debt BUT.. and it's a big but, CHC's major creditor is also a 40%+ shareholder so the chances of this ever happening are sadly slim. lso, as CHC is not a US company (Grand Cayman), I'm not sure how the legalities of filing for CH 11 protection work as it is a US thing and not replicated globally.
It looks like the new mgmt team are doing a good job of trimming the fat out of the organisation and finding that viable business model I mentioned above. The difficulty is doing it now in the middle of possibly the worst oil slump for a generation, rather than doing it when the going was good.
In my opinion, CHC will carry on limping until there is a good way to refinance that debt despite all the good people, work and intentions that are in place there.
This is the number we were waiting for for compliance with NYSE rules. The minimum share value (as I got wrong before before everyone enjoys reminding me) is $1 so taking it up to $9 should provide plenty of leeway. If it crashes down to lower than a dollar from there I think the game is well and truly up. I think the NYSE valuation model requires $40m not $50m but not sure if CHC is a domestic company (registered in Grand Cayman after all) or classified as foreign which is either $60m or $100m. Either way, the valuation is difficult.
In terms of staying listed, I think that the listing of CHC was done by CD&R to fulfil their last remaining investment objective with the business. Keeping it listed makes almost no sense today, it's just dragging CHC's name through the mud in public. We have to think of the way finance people think to understand why listing is important but in essence it's a good way to recover their original investment money. There are more stringent rules financially for publically traded companies so in theory it might be easier for CD&R to buy CHC outright and de-list but that would require pouring good money after badly invested money so why would they do that?
In terms of insolvency (you mention Ch 11), that in theory happens when one of 2 things happen. You either run out of cash reserves or your total liabilities exceed the value of your company. CHC is sailing close to the wind on both for sure. What filing for Chapter 11 would do is in theory allow protection from creditors (ie people to whom CHC owe money to) while they sort out their business and find a viable model to proceed with. A by product of CH 11 proceedings is usually a huge haircut for the creditors (maybe they get back 30c on the $ for example). This would be an absolutely brilliant way to get CHC out of the mud where it is now as what is crippling CHC is centrally held debt BUT.. and it's a big but, CHC's major creditor is also a 40%+ shareholder so the chances of this ever happening are sadly slim. lso, as CHC is not a US company (Grand Cayman), I'm not sure how the legalities of filing for CH 11 protection work as it is a US thing and not replicated globally.
It looks like the new mgmt team are doing a good job of trimming the fat out of the organisation and finding that viable business model I mentioned above. The difficulty is doing it now in the middle of possibly the worst oil slump for a generation, rather than doing it when the going was good.
In my opinion, CHC will carry on limping until there is a good way to refinance that debt despite all the good people, work and intentions that are in place there.
The stock consolidation is just house keeping. I believe CHC will come to the market next week with commentary over their latest Q numbers but given oil is trading where it is I don't see anything that changes the investment view.
Simply cutting costs is unsophisticated and it seems to me that CHC's executive merely live in hope that crude prices rebound which if you look at oil production and global economic growth it's hard to see that happening in a timescale that suits CHC.
Maybe next weeks earnings call gives something new but I doubt it. Just my view and it might be wrong it's the internet, etc, etc good luck if you work there or have skin in the game but as I have said all along - like it or not the stock price is telling you something about the under lying entity. FACT.
Simply cutting costs is unsophisticated and it seems to me that CHC's executive merely live in hope that crude prices rebound which if you look at oil production and global economic growth it's hard to see that happening in a timescale that suits CHC.
Maybe next weeks earnings call gives something new but I doubt it. Just my view and it might be wrong it's the internet, etc, etc good luck if you work there or have skin in the game but as I have said all along - like it or not the stock price is telling you something about the under lying entity. FACT.
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CHC are required to maintain compliance with the NYSE’s $50 million average global market capitalization and shareholders’ equity over a consecutive 30 trading-day period. NYSE have accepted CHC's plan to regain this level and have given the company until Feb 2017 to achieve this.
Having a stock exchange listing requires a very high degree of transparency (Contract award/loss, profit/loss forecasts, legal issues, Director sharedealings, takeover/merger plans etc.) Basically there should be no secrets and therefore no surprises for investors.
The advantages of a listing normally include better credit ratings and less perceived risk to anyone investing in you or doing business with your company.
Unfortunately as CHC, are finding out, one of the disadvantages is that your poor performance gets a public airing at least every quarter and this almost certainly has a negative influence on anyone looking to award or renew a contract with them.
I am unsure why CHC are doing this to themselves over a paltry $25 million of traded capital?
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Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.
Warren Buffett
Having a stock exchange listing requires a very high degree of transparency (Contract award/loss, profit/loss forecasts, legal issues, Director sharedealings, takeover/merger plans etc.) Basically there should be no secrets and therefore no surprises for investors.
The advantages of a listing normally include better credit ratings and less perceived risk to anyone investing in you or doing business with your company.
Unfortunately as CHC, are finding out, one of the disadvantages is that your poor performance gets a public airing at least every quarter and this almost certainly has a negative influence on anyone looking to award or renew a contract with them.
I am unsure why CHC are doing this to themselves over a paltry $25 million of traded capital?
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Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.
Warren Buffett
Max, one of the answers would be to save the cost of taking the firm private again (buying each other out would be very pricey). You also have to consider the exit strategies from coming off the NYSE (or any other exchange for that matter) of the PE owners which almost always will end in another IPO. With IPOs being priced at 3-5% of the value of the company as the bankers fee or a flat fee equivalent, it's not surprising that remaining listed is the best of a bad bunch.
I heartily agree that having ones name dragged along through the mud is sad to see every quarter but is the price for CHC as a company to pay for having largely discredited former management and reckless owners.
I heartily agree that having ones name dragged along through the mud is sad to see every quarter but is the price for CHC as a company to pay for having largely discredited former management and reckless owners.
