jetblue32
Topic Author
Posts: 54
Joined: Fri Aug 17, 2007 3:05 pm

VX Q2 Earnings/loss?

Mon Sep 05, 2011 6:36 pm

Hello, I was wondering if anyone had any data or projections on Virgin America's financial results from the 2nd quarter this year, if they managed to make a profit, or continued their losing streak. I know they usually take awhile to report on this after other airlines do. I hope they manage to turn around and be profitable, as they are such a great airline. Also, anyone know if they are still taking all their aircraft deliveries as scheduled, or decided to defer some of them as a result of their large financial losses recently?
 
nutsaboutplanes
Posts: 456
Joined: Thu Jul 29, 2010 3:37 am

RE: VX Q2 Earnings/loss?

Tue Sep 06, 2011 4:18 am

I don't believe that they have scheduled a call yet. Most airlines announce their earnings call about a month and a half out.....I know that's the case with AS, US and AA. I went to multiple web-sites looking for this information and Virgin does not have an investor relations link (I am guessing this is due to their financial backing set-up) so there was no info on their web-site. The only information that was available came with this quote from their 1Q report:

"The airline has seen significant year-over-year increases in traffic, bookings and average fares in the second quarter of 2011. The airline will release its second quarter results later this summer. "

Also, as identified in a thread after VX's 1Q release:

"The airline ended the quarter with $25 million in unrestricted cash and $54 million in total liquidity."

I don't know, this is just not making a whole lot of sense to me. If their second quarter is not profitable, their third quarter likely will not be pretty as fuel has been consistently higher in Q3 than in Q2. I know airlines brace for the revenue hit that occurs during the fall months after the summer travel season ends and if VX doesn't have a profitable quarter, 25 million wont cut it as evidenced by a 29 million dollar loss in Q1.

On top of all of this, they launched service to ORD and DFW in this quarter.....we know what AA and UA did to fares in these markets and with fuel where it has been, the negative pressure on earnings could be nasty.

Their 1Q report occurred on June 10 so we should be seeing something very soon. I cant see how their performance is sustainable but they have proven that they are persistent and I expect that they will fight on until the absolute end. They have tons of new jets coming on line in the next 12 months and that is not cheap....this means hiring, training and the opening of new stations.....all of these have an astronomical cost. My bet is that we will hear of yet another sizable cash infusion in the not too distant future......that is the only way that they will be able to capitalize on the new aircraft coming their way.
American Airlines, US Airways, Alaska Airlines, Northwest Airlines, America West Airlines, USAFR
 
LAXintl
Posts: 20183
Joined: Wed May 24, 2000 12:12 pm

RE: VX Q2 Earnings/loss?

Tue Sep 06, 2011 4:40 am

In previous years Q2 earnings and traffic results came out via a press release during late August - mid September time frame.
So an announcement is likely soon.

Quoting Nutsaboutplanes (Reply 1):
I don't believe that they have scheduled a call yet. Most airlines announce their earnings call about a month and a half out.....I know that's the case with AS, US and AA. I went to multiple web-sites looking for this information and Virgin does not have an investor relations link

There is no need for an investors call. Virgin America is privately held, and the public disclosure they make in the press releases is voluntary. There is minimal regulatory filing requirements being a private entity.

Quoting Nutsaboutplanes (Reply 1):

"The airline ended the quarter with $25 million in unrestricted cash and $54 million in total liquidity."
I don't know, this is just not making a whole lot of sense to me.

As I've said before don't worry about cash - its a meaningless measure for VX as its always hovered in the same range.
For the last 9-quarters its always been between $22-$38mil regardless of what losses they incurred.

Being private they don't need to report all their holdings, or commitments of their investors.
A good example is Spirit which when private used to run what appeared to be dangerously low cash reserves ($16mil) but now that they are public in their first earnings release surprised everyone revealing mega cash holding of $347mil.
From the desert to the sea, to all of Southern California
 
nutsaboutplanes
Posts: 456
Joined: Thu Jul 29, 2010 3:37 am

RE: VX Q2 Earnings/loss?

Tue Sep 06, 2011 8:08 am

Quoting LAXintl (Reply 2):
There is no need for an investors call. Virgin America is privately held, and the public disclosure they make in the press releases is voluntary. There is minimal regulatory filing requirements being a private entity.

For a company like VX, what is the negative to going public at this point? I guess the nebulous nature of their reporting is to their benefit as a start-up and maybe they have more control over the direction of their business with their current structure but what else is keeping them from doing this?

Do you think that they are close to a public offering especially considering their growth projections for the next 22-24 months?

I don't know a whole ton about VX.....I have flown them twice and enjoyed it.....I just wish their existence and their future direction weren't so mysterious.
American Airlines, US Airways, Alaska Airlines, Northwest Airlines, America West Airlines, USAFR