Virgin America Revenue...

[jayme]

Ok, I think I figured out how you got interest expense: EBITDA-earnings-taxes(assumed 0)-depreciation-amortization.

Assuming that's what you did, how is a high (if it is actually high compared to industry standard) interest expense:total labor costs a "deep, structural" issue? Especially considering our extremely low labor costs? Could you not have found a more arbitrary metric? How about interest expense:bird strikes/74 flight hours?

Maybe we do have an unhealthy amount of debt (who am I kidding? Of course we do.) That doesn't spell certain doom. Aren't you. The same guy who predicted Spirit's imminent demise? Of course the losses can't just continue. I just don't think they will. Only time will tell.

I get the feeling you jusy want guys to leave VX to drive up training costs

 

[jayme]

Double post

 

[Fubijaakr]

Who cares! If it makes you feel better, you can carve those stats on your airline's future tombstone.

Exactly. PeoplExpress was one of the most popular upstart airlines in history...right up to the day they closed their doors.

 

[NEDude]

Exactly. PeoplExpress was one of the most popular upstart airlines in history...right up to the day they closed their doors.

Ummm "closed their doors"?

Try again.

They certainly were struggling financially and could not survive alone was they were, but they did not close their doors.

Learn history before you spout off.

 

[Lake Alice]

People Express also expanded at a rate they were incapable of maintaining. They lacked a reservation system to handle their expansion. The rate of overbooking was a distinct flaw in their growth plan. Ultimately they sold out to Texas Air. Pilots got screwed.

 

[clickclickboom]

The problem is that VA took a few years to get started then came about at the absolute worst time a startup could have begun. Branson is offering guaranteed returns because he has to AND he is gambling that the operation will begin to make a profit.

I said it a long time ago that the smartest thing that JB could do is buy VA because they erode our revenue on competing routes but now with jb banking some serious revenue and va's unexclusive and unexciting route system I say that VA offers nothing that jb would want as SFO has shown to be low yield for us.

BUT we recognize that VA is getting a serious premium for first class.. A little birdie that told me that JB has a few birds slated for all first class 80-100 seats doing some transcon routes to lax, sfo, jfk, bos etc at a 35-40% discount over the all white seats flying it now

 

[n757st]

Some concerning numbers in your financial statement.

Profit q3 2010: 7 million
Profit q3 2011: -3 million

Profit year to date 2010: -43 million
Profit year to date 2011: -69 million

Operating profit 2010: - 1 million
Operating profit 2011: - 19 million

Ex fuel casm increased by 9%

I see your RASM increased, but looking at your financial statement things are concerning. Besides revenue every other financial metric deteriorated. I wish you the best of luck, seriously.

 

[Fubijaakr]

Some concerning numbers in your financial statement.

Profit q3 2010: 7 million
Profit q3 2011: -3 million

Profit year to date 2010: -43 million
Profit year to date 2011: -69 million

Operating profit 2010: - 1 million
Operating profit 2011: - 19 million

Ex fuel casm increased by 9%

I see your RASM increased, but looking at your financial statement things are concerning. Besides revenue every other financial metric deteriorated. I wish you the best of luck...

With those numbers, its going to take a lot more than luck. Its going to take Sir Dick bribing investors with "guaranteed" returns on their investment. That means pouring endless money down the rathole. The only ones that's good for are the rats.

 

[ualdriver]

I see the "Wages, salaries and related costs" line, but not "interest" or even how much debt we have. Considering that isn't a balance sheet, I wouldn't expect to. So how much debt do we have and at what interest rate?

Hey, that's a great question! How much debt DO YOU GUYS have and what is the weighted interest rate? I have a buddy that I chat with about airline financials as we both like airline stuff, and I jokingly refer to VA as the "hermit airline," in reference to North Korea being the "hermit nation." VA fought from the beginning to not release any Form 41 data at all. Remember? I think they lost that argument back in early 2009, so now we get these nebulous press releases. In fact, the only info I have been able to find about this most recent line of credit is that it is coming from a "hedge fund" and they supposedly don't have to pay it back right away, surprisingly. They won't talk about the details....

"The new money came through a debt facility, whose first repayment is due in 4 1/2 years. The company declined to describe repayment terms or name the lenders."

As far as how you can closely estimate how much interest you're paying (a lot!), go back to the VA website, scroll down to the Consolidated of Operations, and look at the line labeled, "Other (income) expense." Numbers in () on that line are good. Positive numbers are bad. Most airlines sum the total of their interest expense and interest income on that line. Obviously, since the number is a big positive number relative to gross income, they are paying lots of interest on debt. Take a look at what a mediocre performing airline like United pays as interest as a % of revenue and then look at yours. Heck, look at a bankrupt airline like American while you're at it. You guys are paying twice as much as a % of revenue on your debt, and it is likely going to go nowhere but up as you have to keep borrowing (at likely very unfavorable rates) to keep the operation solvent.

As for your "deep, structural issues", you never mentioned that only pertained to financial ones. So I gave you some concrete examples of "deep, structural" issues that put us at or near the top of the pack as far as what you need to run a good, profitable airline.

He-he. Yeah losing tons of money to me is indicative of "deep structural issues" whether you're #1 in on-time or whatever your favorite metric is. Would you rather be last in all those categories and make money every year or first and lose bucket loads? Right now you are in the latter category.

There are a few good reasons we haven't made money. We started about 9 months before the economy tanked. That's probably the biggest one. The rest of the industry insisting we go through another audit of our finances, during which time we couldn't finance our business plan. That's another. The huge cost of starting an airline with brand new, highly modified airplanes. Yup, that probably would cost a lot of money up front. Fuel prices spiking, while we open new markets? Yeah, that's not good. We had to discount our tickets to get people to try us, but at the same time paying $4/gallon for jet fuel. I guess I can see how an airline might lose a lot of money doing that. Does that equate to "deep, structural issues?" No, it does not. You were talking out of your ass.

Hmmmm.......didn't JetBlue come up during a pretty rough time in our economy? 9/11, a couple of big recessions, big stock market crash. That's a peer airline, isn't it? A320 operator, non-union, low fare, rapid growth, fancy specialized cabins, all that good stuff. Go back and take a look at how JetBlue was during those difficult times compared to how you guys are doing during similar difficult times. Let me know if I'm still talking out of my ass.

 

[Tomct]

Actually, NO. There is no one out there that has the complexity of our interiors. JB is a DISTANT second...if that! The funny thing is that we are actually making JB add F/C to their a/c...they have pulled back on competing with us on certain routes because we are taking their customers. Same as AA.


No one has a crystal ball and there are no guarantee's in this business, I believe that we will be around and if not for anything else, merge with someone...who knows. It makes me laugh to hear all the "High Minded" run our numbers and tell us how bad things are here at Virgin. And yet, miraculously can't explain how we are getting more money etc...etc...etc. Tell you what, worry about your "merged lists, inferior products and pissed off attitudes" and let history judge who was right.

Merry Christmas everyone and good luck.
P.S. If any Terrorist attack were to happen again, we would ALL be out of a job! God Bless!!