Republic 4th qtr and year end results

[Captain Morgan]

Here's how I am going to bet this turns out:

1. Oil goes up.
2. Loads don't get much better, but stay stagnant.
3. Company X comes in to buy Frontier Planes and Certificate.
4. Republic/Shuttle/CHQ/Lynx maintains a smaller presence in the FFD arena resulting in some furloughs.

This is just my guess, it will be interesting to see how it comes out. One thing that is comforting to me is that I've always been wrong in guessing companies, however I'm not taking the chance to wait and see. My resumes are out. I sincerely don't want to see anybody on the street. Good luck to everybody!

 

[stratus72]

It is a news article.....it has nothing to do with your saga per se....what happens at your company affects what happens at mine in a weird way. If republic goes under for some reason, that affects the industry which then affects me. That is why I post a news article. Make more sense to you.

Oh, I understand...it's just a valid observation on my part. You're right, it's very fluid and tends to make ripples, good or bad, throughout the entire industry. However, it comes off as gloating...come one, admit it. ;-/

 

[dav8or]

http://biz.yahoo.com/bw/110222/20110222007609.html?.v=1


Any thoughts?

Fixed Fee is still bankrolling the Branded side but the lowly commuter pilots stole their career.

 

[maxblast72]

They have 430 mil in the bank (139 mil restricted) so unless the unrest in Middle East goes rabid (i.e. Saudi Arabia) and we end up with $200 oil, I think RAH can get through this as well as anyone else. The only problem is the branded flying (correct me if I'm wrong) is concentrated in MKE and DEN where there are two other airlines with very strong market shares and are about to combine forces.

They raised close to $100 million of that in an equity offering during Q4 to raise some money to start paying for the E-190 aircraft that start coming this year. So basically they still have $200 million in the bank and a FFD operation that will cross-subsidize Frontier if needed.

Bedford and crew did some talking today on the conference call about what they could do (with respect to capacity) if energy prices stayed high. Wonder if Gary Kelly will hold off on DEN, MKE, and MCI ticket price increases to put the squeeze on Frontier if energy prices stay high? Going to be an interesting 2011.

 

[StaySeated]

Fixed Fee is still bankrolling the Branded side but the lowly commuter pilots stole their career.

Straight from RJET 10K and 10Q's.....


FFD Operating Revenue (x 1,000):

2001 241,028
2002 356,197
2003 492,280
2004 646,324
2005 905,021
2006 1,118,246
2007 1,274,607
2008 1,462,211
2009 1,180,209
2010 1,030,306

FFD Net Revenue (x 1,000):

2001 6,067
2002 7,689
2003 36,138
2004 38,852
2005 60,654
2006 79,510
2007 82,758
2008 84,580
2009 36,385
2010 -13,845

At the peak of the economic cycle, in 2008, the FFD side of the house (what you refer to as the "bankroll") operated 221 Regional Jets and zero narrow body aircraft.

E140LR 15
E145LR 62
E170/175LR 127
CRJ-200 17
Total 221

Notice, that only two short years ago, your "bankroll" did not operate a single E-190. Without the Midwest and Frontier acquisitions, you could not operate anything larger than a 175.

At the end of 2009, the FFD side operated 195 RJ's. A reduction of 26 aircraft.

At the end of 2010, the FFD side operated 187 RJ's. A reduction of 34 aircraft from the 2008 peak.

How many RAH pilots have been furloughed as a result of the 16% reduction in fleet?

How many RAH pilots have received pay increases as a result of the expansion of 190 flying?

The FFD operation is not going to disappear, but it is impossible to defend the position that the FFD side is a "cash cow" and that your career expectations have been negatively affected by the acquisition of Midwest and Frontier.

 

[StaySeated]

They raised close to $100 million of that in an equity offering during Q4 to raise some money to start paying for the E-190 aircraft that start coming this year. So basically they still have $200 million in the bank and a FFD operation that will cross-subsidize Frontier if needed.

Bedford and crew did some talking today on the conference call about what they could do (with respect to capacity) if energy prices stayed high. Wonder if Gary Kelly will hold off on DEN, MKE, and MCI ticket price increases to put the squeeze on Frontier if energy prices stay high? Going to be an interesting 2011.

This is not accurate.

The EMB 190 agreement actually results in positive cash flow and a reduction of debt.

NONE of the stock offering is pledged to EMB for the 190.

RJET owns several 140 and 145, and they are sub leasing these off shore.

RJET also leases several 145's, and they are exchanging these long term leases for new 190 leases.

If you look at the 2010 numbers, RJET managed to increase cash, reduce restricted cash, AND reduce debt.

Cash increased by $80.1 MM
Restricted cash decrease by $53.6 MM
Debt decreased by $210 MM

Total balance sheet repair = $343.7 MM

If and when RJET makes a similar deal with Airbus you will see older, smaller 319's replaced by newer 320's, for less money.

I am not a fan of what is happening here from a selfish personal perspective, but 2010 was a rather impressive coup with regard to the balance sheet.