Fuel prices drag down Virgin America’s financials

[NEDude]

Sorry man. You are delusional.

If you think that VA management is purposely doing things to make your numbers look THAT bad, then you seriously are drinking the red kool-aid. It doesn't matter if I like VA or I don't, their numbers are BAD. Period.

For the year ending DEC 31, 2010, your airline had a NET loss of 68.7M on 724M of revenue. It had 30M in unrestricted cash and 66M of liquidity.

For the quarter ending March 31, 2011, your airline had a NET loss of 44.6M on 201M of revenue. It had 25M in unrestricted cash and 54M of liquidity.

For the quarter ending June 30, 2011, a quarter where just about every airline made a nice profit, your airline had a net loss of 21.7M on 268.5M of revenue. It had 26M in unrestricted cash and 53M of liquidity. I think cash they collected for future summer bookings not yet flown probably boosted their unrestricted cash numbers, but admittedly that is just a guess. We'll know more over the next two quarters.

Another interesting thing to note is that they keep getting deeper and deeper into debt. If you look at their other income(expense) line, that number keeps getting bigger and bigger. That number is normally associated with interest expense. That also might explain why their cash balance isn't going down. Maybe some investors are throwing them some short term cash unsecured by company assets?

When the airline leads with "Airline Reports 46 Percent Increase in Operating Revenues" yet forgets that other little part....."but our operating expenses went up 48.5% over the same reporting period" you gotta admit they're just grasping at straws looking for something- anything positive to say.

On the plus side, hopefully the majors will start hiring soon and you guys can bail before they start breaking out the bongs with the kool-aid.

What good would reporting profits do at this point? Give me one good reason? They are a privately held company, who are they trying to impress? Only the IRS, and perhaps the boneheads of FI.com, would be impressed by profits right now.

How do you reconcile the fact that Virgin America keeps growing - ordering and taking delivery of (just for you fubi) new aircraft, repeatedly expanding our office space, investing in new training facilities, hiring like crazy - with the fact that the company has done nothing but lose money for close to five years? What other company has done that? When every other airline has lost money they furlough, stop growth, etc (believe me I know - I have more than my fair share of working for airlines that are really struggling). Are you under some delusion that millionaire and billionaire investors just have money to throw away, especially in a bad economy?

The only possible, reasonable, explanation is that the entire financial picture is not being seen in the financial reports that are being released for public consumption.

 

[Fins Up]

What good would reporting profits do at this point? Give me one good reason? They are a privately held company, who are they trying to impress? Only the IRS, and perhaps the boneheads of FI.com, would be impressed by profits right now.

How do you reconcile the fact that Virgin America keeps growing - ordering and taking delivery of (just for you fubi) new aircraft, repeatedly expanding our office space, investing in new training facilities, hiring like crazy - with the fact that the company has done nothing but lose money for close to five years? What other company has done that?

I believe Skybus was going just fine until they closed their doors. "Don't come to work tomorrow guys. Good luck getting home." It went pretty much like that.

 

[Fubijaakr]

Sorry to be a dose of reality while you gleefully hope many ALPA brothers lose yet another job, but Virgin is not going anywhere soon.

Sorry, Dude. You gave up the right to be called an ALPA when you willingly took a non-Union job that undercuts an ALPA pay scale.

Sorry man. You are delusional.

If you think that VA management is purposely doing things to make your numbers look THAT bad, then you seriously are drinking the red kool-aid. It doesn't matter if I like VA or I don't, their numbers are BAD. Period.

True, especially the delusional part. Its kind of like saying the Navy wanted Japan to bomb Pearl Harbor so they could buy some new battleships.

Another interesting thing to note is that they keep getting deeper and deeper into debt. If you look at their other income(expense) line, that number keeps getting bigger and bigger. That number is normally associated with interest expense......"but our operating expenses went up 48.5% over the same reporting period" you gotta admit they're just grasping at straws looking for something- anything positive to say.

On the plus side, hopefully the majors will start hiring soon and you guys can bail before they start breaking out the bongs with the kool-aid.

Personally, I hope they get a clue and bail out too. Get out while the getting is good. It would suck to be unemployed AGAIN when you had the opportunity to abandon ship.

I believe Skybus was going just fine until they closed their doors. "Don't come to work tomorrow guys. Good luck getting home." It went pretty much like that.

It wouldn't be the first time an airline grew into obivion. FlyI comes immediately to mind.

 

[Q400 Gear Bitch]

Its kind of like saying the Navy wanted Japan to bomb Pearl Harbor so they could buy some new battleships.

The Germans bombed Pearl Harbor. Duh.

 

[weasel_lips]

What is the consequence of a privately held company reporting a profit? More taxes. Which is why you will see VX reporting a loss until the IPO nears, which will not be until the economy is on more solid ground.

So according to you, each quarter VA is secretly makes millions. They then falsify their financials, commit tax evasion,file false reports to the DOT, and then publish a false press release.

 

[ackattacker]

Are you under some delusion that millionaire and billionaire investors just have money to throw away, especially in a bad economy?

The only possible, reasonable, explanation is that the entire financial picture is not being seen in the financial reports that are being released for public consumption.

Personally, yes, I believe billionaire investors do have money to just throw away as they have repeatedly demonstrated by trying to invest in aviation. It's been shown that over the course of history all airlines have basically lost money in the long run so you pretty much have to be a moron to keep trying.

Financial reports are subject to stringent ethical and auditing guidelines. No way that the CFO of Virgin America is violating those guidelines, she's one of the people who WROTE the guidelines.

 

[NEDude]

So according to you, each quarter VA is secretly makes millions. They then falsify their financials, commit tax evasion,file false reports to the DOT, and then publish a false press release.

Nope, never said that. There are dozens of ways to legitimately report a loss. A very simple one is to aggressively pay your creditors and investors. They are legit bills, nothing remotely false about it. Again the important thing for the survival of Virgin as long as it is privately held is not whether the company makes money, it is whether the investors make money, and that is two separate issues. Once the company becomes public, then yes, profits become important because they affect the value of the stock and thus whether the investors make money. Both the word in the company and the actions of the company indicate that the investors and creditors are being paid very aggressively, and are thus sufficiently happy.

Again, what is the point of reporting a profit at this point? Who does it impress other than a bitter old Alaska pilot and a few other morons on FI.com? How can you explain a steady cash position and four years of growth if the company is teetering on the brink? Still waiting on another logical explanation. And billionaires just wishing to waste money is not a logical explanation.

As for the Skybus comparisons posted by others - give it up already. Skybus operated less than a year, and was showing very bad signs in the months leading up to closing the doors. Virgin has been operating for over four years and is still growing. The comparisons are no longer remotely valid.

 

[ualdriver]

Then you won't have to worry about us and I can take my recall at UAL with the longevity pay that you will make sure we get. UAL still lost more money from 2003-2009 than we have yet so we have some time..with a better product and a rebel billionaire. You know what UAL guys are making so get off our back. As I know you are the one who is pounding that retro is a must but longevity pay is negotiable. Sad from the days both my parents walked the line to make UAL better for you

Please. You know, I'm sorry you guys got furloughed, but all things considered, it is not like you are forgotten. You got severance. You have passes. You had your health insurance paid for. You get to bypass for how many years? This last agreement with the company gets you a chance to work at CAL if you want.

Ask you parents who are "so ashamed" what they themselves got when they were furloughed or when their peers were furloughed at United a generation ago and then get back to me how badly you are being treated as a furloughee today.

I have no clue if you will get longevity. I have no clue if we will get full Retro. You haven't a clue what drum I am beating, but if you did, you'd likely aim a little better. And if you don't like how you're being treated, vote with your feet. You don't have to come back. Stay at VA. Rumor has it that they secretly making millions. Then you and your parents won't have to be so sad.

 

[ualdriver]

Nope, never said that. There are dozens of ways to legitimately report a loss. A very simple one is to aggressively pay your creditors and investors. They are legit bills, nothing remotely false about it. Again the important thing for the survival of Virgin as long as it is privately held is not whether the company makes money, it is whether the investors make money, and that is two separate issues. Once the company becomes public, then yes, profits become important because they affect the value of the stock and thus whether the investors make money. Both the word in the company and the actions of the company indicate that the investors and creditors are being paid very aggressively, and are thus sufficiently happy.

Again, what is the point of reporting a profit at this point? Who does it impress other than a bitter old Alaska pilot and a few other morons on FI.com? How can you explain a steady cash position and four years of growth if the company is teetering on the brink? Still waiting on another logical explanation. And billionaires just wishing to waste money is not a logical explanation.

As for the Skybus comparisons posted by others - give it up already. Skybus operated less than a year, and was showing very bad signs in the months leading up to closing the doors. Virgin has been operating for over four years and is still growing. The comparisons are no longer remotely valid.

I think Skybus is a valid comparison. How about TWA? They had a relatively young fleet and were taking deliveries to the end.

I could care less if an airline is taking deliveries or building new facilities. One of the many jobs a CEO has is head cheerleader. He's going to go out there and say everything is going great! Nothing to see here. You know, like Baghdad Bob. "They are not near Baghdad. Don't believe them....." Your leaders have to give the appearance of normalcy. People buy tickets largely for FUTURE travel. They aren't going to drop a grand for the family to visit grandma for Christmas if there is even a hint of trouble at VA. Smiles everyone, smiles!

Sorry. They aren't paying down debts "aggressively." They are simply losing money, quarter after quarter, and it has to stop at some point. If I were a VA guy, I would be sharpening up my resume.

 

[ackattacker]

Nope, never said that. There are dozens of ways to legitimately report a loss. A very simple one is to aggressively pay your creditors and investors. They are legit bills, nothing remotely false about it. Again the important thing for the survival of Virgin as long as it is privately held is not whether the company makes money, it is whether the investors make money, and that is two separate issues. Once the company becomes public, then yes, profits become important because they affect the value of the stock and thus whether the investors make money. Both the word in the company and the actions of the company indicate that the investors and creditors are being paid very aggressively, and are thus sufficiently happy.

Again, what is the point of reporting a profit at this point? Who does it impress other than a bitter old Alaska pilot and a few other morons on FI.com? How can you explain a steady cash position and four years of growth if the company is teetering on the brink? Still waiting on another logical explanation. And billionaires just wishing to waste money is not a logical explanation.

As for the Skybus comparisons posted by others - give it up already. Skybus operated less than a year, and was showing very bad signs in the months leading up to closing the doors. Virgin has been operating for over four years and is still growing. The comparisons are no longer remotely valid.

I'd agree the comparisons with Skybus are irrelevant.

However your belief that there is some secret profit is breathtakingly naive.

Financial statements do NOT include "paying back investors" as some sort of operating expense (except for interest payments), nor do they include the money lent by investors as revenue. It's simply revenue - expenses = net profit or loss. "Agressively paying back your investors and creditors" would adversely affect your cash position, not your net. Since their cash position is unchanged during heavy operating losses, the implies exactly the opposite, that they are aggressively borrowing.