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Virgin Atlantic

Old 24th Apr 2020, 23:37
  #321 (permalink)  
 
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Trading Update for Six Months ending 31 March 2020


Link from another forum, ezy currently sitting on circa 3bn in cash to see them through.
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Old 24th Apr 2020, 23:46
  #322 (permalink)  
 
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National flag carriers get bailed out, generally, private companies don’t.

That may not be perceived as being very fair but that’s the way it is.

One of the best flights I ever had was with Virgin, but also so was the worst.

I don’t understand all the bashing of Virgin that goes on here from some members, but conversely I also don’t understand why Virgin feel they are a special case that are deserving of a taxpayer bailout? Just like the many UK airlines that have come and gone before them, no one is immune or special enough to warrant exclusion from going into administration if the business case isn’t there. Even more so in Virgins case where they’re profit relative to turnover is horrendously poor.

Great advertising and a Hollywood Playboy style image isn’t enough not to be expendable. It’s just business, it’s not personal. Thats probably hard to imagine when you’re sat at 30°W and the realisation sets in that soon it could all be over, but it’s not the first time many a career pilot has been in that exact same situation pondering the exact same reality. The waste of it is tragic but it’s a very real possibility now.

Delta might only own 49% of Virgin but they’ve been calling the shots and essentially steering the ship to a great extent over the last few years. Until now they’ve had a bottomless pit of money which has proved very lucrative and successful for Virgin Atlantic, but now the party is over.

Richard Bransons handling of the plight of Virgin under the current circumstances couldn’t of been handled any worse it would seem, if anything he’s just whipping up a sentiment of hostility in the tax payers mind towards his cause. I personally don’t think he will stomp up the cash himself? Who would? Running an airline and making money out of it successfully is very difficult to achieve and the Virgin model isn't the best In the business by far. Although the company is the flagship of his brand, this is going to really test his metal. It has survived this long only through clever marketing, smoke and mirrors and a succession of differing shareholder stakes over the years who have had money to burn.

I sincerely hope for all who work there that something gets pulled out the bag and a rescue package or business deal of some kind can be hammered out, but one thing is for dead certain, Virgin at the very best, will be a shadow of its former self once this current crisis passes, if it survives at all.

Last edited by Go4PoweredDecent; 25th Apr 2020 at 01:34.
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Old 24th Apr 2020, 23:47
  #323 (permalink)  
 
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Any airline getting a State handout should at the very least have the basic decency to refund customers. Properly. Legally. Cash. 14 days.
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Old 25th Apr 2020, 00:31
  #324 (permalink)  
 
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Originally Posted by Maxfli View Post
As I understand it so far in terms of Government Financial Support...............

Lufthansa negotiating to get €10B (includes aid for Swiss & Brussels Airlines)
https://www.reuters.com/article/us-h...-idUSKCN2252Y6

AF/KLM to get €7B
https://finance.yahoo.com/news/air-f...182631506.html

easyJet to get €500M
https://www.theguardian.com/business...asury-and-bank

SAS to get $350M
https://www.forbes.com/sites/davidni.../#7e80bad519b4

Alitalia got €400m in February

TAP
The Portuguese Prime Minister, Antonio Costa, said today that TAP Air Portugal could be nationalized in the coming days.

I doubt Team Boris have the balls to let Virgin Atlantic collapse, they just want to see a decent chunk being put on the table by the shareholders.
Delta have said they're not in a position to do so, it therefore falls to Virgin Holdings to put cash on the table and chase Delta for their tab, maybe through a shareholding transfer.

VA will get through this, very best to all.
AF-KL Group got a total of nearly 9-11 Billion euros. 2-4 from the Netherlands Govt. and 7 Billion Euros from France total.
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Old 25th Apr 2020, 00:54
  #325 (permalink)  
 
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Originally Posted by covec View Post
Any airline getting a State handout should at the very least have the basic decency to refund customers. Properly. Legally. Cash. 14 days.
It's not a state handout as such, but a credit line. They don't need to actually spend the money. I imagine Virgin and most others will, but it's not a handout.
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Old 25th Apr 2020, 07:22
  #326 (permalink)  
 
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Seems that you need to be viable or have a good credit rating to get government loans which you could argue is right to protect tax payers money.

This is from todays Telegraph:-

Mike Ashley's Frasers Group has been refused an emergency Bank of England loan after being forced to shut its stores, as the chain settled a controversial €674m (£590m) tax bill in Belgium.

The owner of Sports Direct and House of Fraser cannot use the loan scheme because it does not have the required credit rating.

Frasers said that it had not been accepted as eligible for the programme to help Britain's biggest firms using public mnoey during the coronavirus pandemic. The likes of Primark and Greggs have been able to tap it up for extra cash.

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Old 25th Apr 2020, 07:59
  #327 (permalink)  
 
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[QUOTE=giggitygiggity;10762259]It's not a state handout as such, but a credit line. They don't need to actually spend the money. I imagine Virgin and most others will, but it's not a handout.[/QUOTE

VS need to repay $200 Million to Delta,where’s the money?
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Old 25th Apr 2020, 08:34
  #328 (permalink)  
 
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[QUOTE=Phantom4;10762447]
Originally Posted by giggitygiggity View Post
It's not a state handout as such, but a credit line. They don't need to actually spend the money. I imagine Virgin and most others will, but it's not a handout.[/QUOTE

VS need to repay $200 Million to Delta,where’s the money?
If Delta really want to help VS they could convert this current liability to a long term loan. Might be a drop in the ocean, but at least it’s a signal of intent.
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Old 25th Apr 2020, 08:41
  #329 (permalink)  
 
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I think touch&go has hit the nail on the head about protecting taxpayers money. There is a fine line between keeping viable businesses going until the economy restarts and supporting businesses where the future is much less certain. It is not clear that success pre corona or signs of a turnaround as is being argued with Norwegian tell us how viable companies will be. Here in Germany the foreign minister has said that we should expect little or no tourism by air for the rest of the year. This was met with howls of anguish from the trade. But if he is right then business for holiday companies is going to be bleak for a long while yet and some will inevitably need to shut down. Condor is being supported and mates tell me they are quite busy flying stuff from China and agricultural workers from Eastern Europe. But that is clearly only tiding them over and what happens next is very uncertain. I am pretty sure that all airlines are going to look different if and when they properly restart operations.
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Old 25th Apr 2020, 09:12
  #330 (permalink)  
 
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Interesting to hear the views of the former Flybe COO...

https://www.lbc.co.uk/radio/presente...irgin-bailout/
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Old 25th Apr 2020, 10:52
  #331 (permalink)  

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Originally Posted by beardy View Post
So he is non resident and not a British tax payer, but wants the British tax payer to help his 'baby'.
Are you really that ignorant? You sound like one of the hoards of spittle flecked protesters waving their virtual pitchforks demanding something they have no real understanding of. Just to simplify it for you and your ilk, Virgin Atlantic is a British company, employing many thousands of people who all pay income tax and NIC to the treasury, as does the company. The chairman of the board of Virgin Group, Richard Branson, is a figurehead. He does not live in the UK and so isn't liable to pay UK income tax. Even if he did live here, he probably wouldn't be liable for any income tax as he puts all his income these days into charitable causes. That's beside the point anyway. The thousands of employees are hard working and very dedicated to the company and it is the employees who make the company. Their contribution to the government coffers is what counts. Not a bunch of tabloid reading, 'indignant but not understanding why', ill informed vitriolic, probably jealous, bandwagon jumping trolls. Go and find one of the many petitions out there to try and force the collapse of a brilliant airline to work for.This is a Professional Pilots website and you don't sound like one.

As Mark Twain said: “Better to keep your mouth shut and appear a fool, than open it and remove all doubt!”
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Old 25th Apr 2020, 11:44
  #332 (permalink)  
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Originally Posted by Capt PPRuNe View Post
Are you really that ignorant? You sound like one of the hoards of spittle flecked protesters waving their virtual pitchforks demanding something they have no real understanding of. Just to simplify it for you and your ilk, Virgin Atlantic is a British company, employing many thousands of people who all pay income tax and NIC to the treasury, as does the company. The chairman of the board of Virgin Group, Richard Branson, is a figurehead. He does not live in the UK and so isn't liable to pay UK income tax. Even if he did live here, he probably wouldn't be liable for any income tax as he puts all his income these days into charitable causes. That's beside the point anyway. The thousands of employees are hard working and very dedicated to the company and it is the employees who make the company. Their contribution to the government coffers is what counts. Not a bunch of tabloid reading, 'indignant but not understanding why', ill informed vitriolic, probably jealous, bandwagon jumping trolls. Go and find one of the many petitions out there to try and force the collapse of a brilliant airline to work for.This is a Professional Pilots website and you don't sound like one.

As Mark Twain said: “Better to keep your mouth shut and appear a fool, than open it and remove all doubt!”
What he said ^

and ‘Like‘
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Old 25th Apr 2020, 11:49
  #333 (permalink)  

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Originally Posted by wisecaptain View Post
NHS ....Thats a public service ...... not a private company . Big difference and the NHS is beloved to the UK , its saving peoples lives right now so has unending public support and is a Political hot potato at the forefront of Boris political promise list ......
And yet here we have another Branson hater who cannot see beyond his frothy mouthed rants against government assistance in the form of loan guarantees for Virgin Atlantic. As usual, he/she and their ilk will oversimplify everything and refer to the NHS as some saintly, sunbeam sparkled, cherub ridden haven. It's only a matter of time before these people will simplistically throw in a retort about how Branson sued the NHS without knowing any of the details of the case. Irrespective of the fact that the NHS trust involved was acting irregularly with contracts and so were asked to explain but had to be taken to court and eventually they paid out because they knew thy were in the wrong and then all that payout was reinvested into the NHS. But I digress... the halo bearing crowds that stand there clapping at the heavens every Thursday evening are one of the main reasons the NHS is burdened because at the slightest encouragement they will try and sue the NHS, no thanks to all those daytime TV adverts for no win, no fee lawyers who ask if you've ever had an injury etc. Read this to get a better idea of how saintly everyone in this is:

If we love our NHS so much, why are we suing it for £83billion, asks MARTIN SAMUEL

"In the last NHS accounts, 2018-19, the cost of harm bill — the estimated claims bill incurred in one year — was approximately £9 billion.

In 2017, it was calculated that a one per cent pay rise for NHS staff required £500 million in funding. The cost of harm therefore equates to an 18 per cent pay rise — an increase the British public would no doubt support for nurses, if everyone could just stop suing them. And this is the tip of a legal iceberg. The estimated bill for all outstanding compensation claims racked up over the years comes in at £83 billion. In comparison, NHS England’s total budget in 2018-19 was £129 billion. In the maternity ward alone, for every baby born in Britain, £1,100 is incurred by the NHS in indemnity costs against negligence claims."
And here are some "facts" that the bandwagon jumpers can use if they can be bothered actually reading them:

Clinical negligence numbers steady, but rising costs remain a concern
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Old 25th Apr 2020, 11:51
  #334 (permalink)  
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I wonder if all the criticism written hear, was also aimed at the Banks when they were BAILED OUT (not offered a loan)?
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Old 25th Apr 2020, 12:16
  #335 (permalink)  

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Originally Posted by DaveReidUK View Post
With respect, that's Sky News's spin on what Bastian may or may not expect, hence its use of those weasel words "[he] indicated [that]", but it isn't supported anywhere in the article by a direct quote from the Delta CEO.

The nearest he gets is "If they are required to go through an administrative process ...", but he stops short (understandably) of predicting that's what's going to happen.

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Old 25th Apr 2020, 12:27
  #336 (permalink)  
 
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Easyjet:" We estimate that our operating costs burn is in the region of £30-40 million per week, whilst the fleet is grounded. This compares to circa £125 million when flying a full schedule". That's a difference of 10M a week! surely they can be a bit more refined than that, how the hell can you be 10M adrift!! so based on a 500M loan they have 16 weeks or 12 weeks buffer..
Branson doesn't need Virgin to continue, OK it will be a big dent to his reputation if it folds, On the other hand it does seem he is genuinely committed to keeping the airline going, mindful of the staff and consequences and frankly I don't blame him for wanting a piece of the pie from the treasury, after all we give millions in "AID" to Africa which sadly mostly gets spent on arms and fast cars for the dictators or criminals. If we regard Virgin as a "British brand" we should be rallying support for it. Whether or not the airlines will prevail after the restrictions without more hand-outs is obviously on the minds of the bean counters and we may be better of accepting a successful few rather than a struggling many.
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Old 25th Apr 2020, 13:59
  #337 (permalink)  
 
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Originally Posted by Kirks gusset View Post
Easyjet:" We estimate that our operating costs burn is in the region of £30-40 million per week, whilst the fleet is grounded. This compares to circa £125 million when flying a full schedule". That's a difference of 10M a week! surely they can be a bit more refined than that, how the hell can you be 10M adrift!! so based on a 500M loan they have 16 weeks or 12 weeks buffer..
Branson doesn't need Virgin to continue, OK it will be a big dent to his reputation if it folds, On the other hand it does seem he is genuinely committed to keeping the airline going, mindful of the staff and consequences and frankly I don't blame him for wanting a piece of the pie from the treasury, after all we give millions in "AID" to Africa which sadly mostly gets spent on arms and fast cars for the dictators or criminals. If we regard Virgin as a "British brand" we should be rallying support for it. Whether or not the airlines will prevail after the restrictions without more hand-outs is obviously on the minds of the bean counters and we may be better of accepting a successful few rather than a struggling many.

Virgin Atlantic (not Richard Branson) is not seeking a 'hand out'. It is looking for a line of credit of approximately £500m on commercial terms. If it can achieve that without guarantees from the UK government, I'm sure it will happily do so. However, this is a very difficult environment from which to make projections of future revenue, and so UK banks (which are obligated under the current government guarantee schemes to protect small and medium sized businesses by offering loans without preconditions, yet aren't doing so) are being extremely conservative. Ironic, given that they were rescued 12 years ago by unlimited grants from government plus a policy of 'quantitative easing' which effectively removed the consequences of their foolhardy practices of the previous 10 years.

Virgin Atlantic is not the most profitable airline, but it is a major player in the marketplace, and has around 25% of UK-US traffic. It was looking forward to both returning to profit and some moderate expansion in the short to medium term. There is no logical reason to believe that it cannot continue to hold its own in whatever shape the long-haul market takes after things reopen. As happened after the various shocks that the market has had in the last 25-30 years, there will be a short-term correction before the market returns to growth. It's up to the treasury (and its advisers Morgan Stanley) to assess whether or not the financials make a commercial loan viable or not, and what actions need to be taken by the company to improve its position from their perspective. It should also be borne in mind that the problems for the entire industry were not brought on by the actions of the industry (unlike the banks), but by the actions of governments in shutting down international travel.

However, the reaction by the public - and, surprisingly, people in this forum - to Virgin asking for help has been entirely emotional, uninformed, and essentially spiteful, and fuelled essentially by a distaste of wealth without any consideration of what that wealth represents in terms of the employment it has created, and the fact that it is almost entirely shareholdings in businesses and thus to be released for other purposes would require those shareholdings to be sold - at which point the notional extent of that wealth would be seen to be far less than the Sunday Times estimated in 2019.

The Virgin companies are great places to work, and look after their employees extremely well. Their existence generally works well for their customers as well, though inevitably there are individual stories where that is not so, as is the case for every large company. The UK-registered Virgin companies (which includes Virgin Atlantic) pay their taxes in UK, as of course do the vast majority of their employees.

I am about to retire from the industry, so the future of Virgin Atlantic will not affect me personally, but it would be a crying shame if its 10,000 employees and their families were thrown on the scrapheap because of the braying hoards of uninformed commentators who simply want to stick a finger up to Richard Branson
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Old 25th Apr 2020, 14:49
  #338 (permalink)  
 
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but it would be a crying shame if its 10,000 employees and their families were thrown on the scrapheap because of the braying hoards of uninformed commentators who simply want to stick a finger up to Richard Branson
I'm not sticking a finger to Branson, intact quite the opposite [QUOTE]if we regard Virgin as a "British brand" we should be rallying support for it[/QUOTE
We are all well enough informed to separate the man form Virgin enterprises, however, Branson the publicity machine is the one spearheading the very public campaign for the loan and as the "spokesperson" it is natural that his name is used in conjunction with the debate. The issue for some may be that Easyjet got a bail out loan even after paying "contractural dividends" to shareholders, NAS may get a a bail out loan, despite their catastrophic business model, other players in Europe with inflated costs will ,so why not Virgin? the sentiment appears to be emotionally fuelled by individual wealth, of Branson, yet no-one commented on the 1.6 Billion wealth of Stellios..why.. possibly because he argued against it! https://www.bmmagazine.co.uk/news/ea...orate-history/ OK, point scoring against the Board. Why on earth didn't Branson just let the Virgin Board CEO do the talking? he's the one who's now made this a personal crusade.
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Old 25th Apr 2020, 16:45
  #339 (permalink)  
 
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Several have cited a 'return to profitability' - was this not massively dependant on expansion (which helpfully coincided with the 3rd runway debate)? If an airline hasn't been making money in recent years given the market we've been operating in why would it make money in the tough years that will follow?
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Old 25th Apr 2020, 17:24
  #340 (permalink)  
 
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Originally Posted by scroggs View Post
Virgin Atlantic (not Richard Branson) is not seeking a 'hand out'. It is looking for a line of credit of approximately £500m on commercial terms. If it can achieve that without guarantees from the UK government, I'm sure it will happily do so. However, this is a very difficult environment from which to make projections of future revenue, and so UK banks (which are obligated under the current government guarantee schemes to protect small and medium sized businesses by offering loans without preconditions, yet aren't doing so) are being extremely conservative. Ironic, given that they were rescued 12 years ago by unlimited grants from government plus a policy of 'quantitative easing' which effectively removed the consequences of their foolhardy practices of the previous 10 years.

Virgin Atlantic is not the most profitable airline, but it is a major player in the marketplace, and has around 25% of UK-US traffic. It was looking forward to both returning to profit and some moderate expansion in the short to medium term. There is no logical reason to believe that it cannot continue to hold its own in whatever shape the long-haul market takes after things reopen. As happened after the various shocks that the market has had in the last 25-30 years, there will be a short-term correction before the market returns to growth. It's up to the treasury (and its advisers Morgan Stanley) to assess whether or not the financials make a commercial loan viable or not, and what actions need to be taken by the company to improve its position from their perspective. It should also be borne in mind that the problems for the entire industry were not brought on by the actions of the industry (unlike the banks), but by the actions of governments in shutting down international travel.

However, the reaction by the public - and, surprisingly, people in this forum - to Virgin asking for help has been entirely emotional, uninformed, and essentially spiteful, and fuelled essentially by a distaste of wealth without any consideration of what that wealth represents in terms of the employment it has created, and the fact that it is almost entirely shareholdings in businesses and thus to be released for other purposes would require those shareholdings to be sold - at which point the notional extent of that wealth would be seen to be far less than the Sunday Times estimated in 2019.

The Virgin companies are great places to work, and look after their employees extremely well. Their existence generally works well for their customers as well, though inevitably there are individual stories where that is not so, as is the case for every large company. The UK-registered Virgin companies (which includes Virgin Atlantic) pay their taxes in UK, as of course do the vast majority of their employees.

I am about to retire from the industry, so the future of Virgin Atlantic will not affect me personally, but it would be a crying shame if its 10,000 employees and their families were thrown on the scrapheap because of the braying hoards of uninformed commentators who simply want to stick a finger up to Richard Branson
Very well explained Scroggs - pity we couldnt get this to the public domain / press somehow....
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