Virgin America Skirting Ownership Rules To Survive !!

[ualdriver]

Virgin America has lost $270M

San Francisco Business Times - by Eric Young

In its first earnings report in more than a year, Virgin America Inc. said it lost $175.4 million over the first three quarters of 2008.

The Burlingame-based airline booked $259.6 million in revenue during the same period.

When added to figures from 2007, Virgin America has lost $270.2 million on sales of $311.7 million since it began service in August 2007.

Just to give some perspective, JB started ops in FEB 2000 and their first full year was 2001. VA started ops in AUG 2007 and their first full year was 2008.

In 2000, JB's first year, they had 104M in annual revenue and had a net loss of 21M. In 2001, JB's first full year, they had 320M in annual revenue, and a 23M net PROFIT, not including the Airline Stabilization Act money they received. Also, part of that year was affected by 9/11.

 

[Blue Dude]

Don't forget that 19 months after starting operations, JetBlue pilots received a significant pay bump. It wasn't enough in terms of industry average, but VA will need something like a 40% bump in March to match performance.

 

[ualdriver]

Don't forget that 19 months after starting operations, JetBlue pilots received a significant pay bump. It wasn't enough in terms of industry average, but VA will need something like a 40% bump in March to match performance.

Was JB A320 Captain pay 90/hr. as he stated back in 2000? I thought it was 100?

 

[Blue Dude]

At the time JB 5th yr pay (top of scale) was 100. Of course nobody was on that pay rate. 1st year pay was 78! That came up to $110 in Oct 01. An expanded pay scale out to 10 yrs, then 12 yrs, was added later. Yeah, it was bad.

 

[tzskipper]

http://www.ioga.com/Special/crudeoil_Hist.htm

Average price of oil in 2000/2001 was around $25.00/bbl, vs. a 2008 average of $91.48. I would be curious as to the impact/difference to casm between the two for both airlines. Might explain some of the earnings difference.

Skipper

 

[hateairlines]

Don't forget that the initial pilots made a lot of money from stock options. The strike price was very low!

 

[clickclickboom]

Many had initial 6000 shares issued in $1-6 range after three splits and a high of $60... There were numerous pilots here that made 300-500k on their shares.

About 1 year later others had shares issued in the high 50's which we know are worthless.

My strike price was $10.50ish