SlumTodd_Millionaire
Most Hated Member
Regionals don't have any.
The Next Threat to the Industry
- Thread starter RonSwanson
- Start date
Regionals don't have any.
falconvalley
Absentee Dad of the OOTSK, Runner, Cat Frustrator
Nice try Todd!!
SlumTodd_Millionaire
Most Hated Member
?
falconvalley
Absentee Dad of the OOTSK, Runner, Cat Frustrator
I won't post my company's info in here. Anyone who wishes to look it up can, at Rjet.com
falconvalley
Absentee Dad of the OOTSK, Runner, Cat Frustrator
And we're at the bottom!!
SlumTodd_Millionaire
Most Hated Member
Of course not, because it doesn't paint a pretty picture. A company with $1.3 billion in revenue is struggling to maintain a low single-digit net profit margin. Meanwhile it's leveraged to the hilt. I wouldn't touch that stock with your money.
falconvalley
Absentee Dad of the OOTSK, Runner, Cat Frustrator
Heck no, but it's there and available. Supply and demand will take care of it.
SlumTodd_Millionaire
Most Hated Member
I don't think any of those words mean what you think they mean.
falconvalley
Absentee Dad of the OOTSK, Runner, Cat Frustrator
You mean the grounding of airplanes due to staffing?
SlumTodd_Millionaire
Most Hated Member
Do you even math, bro?
Let's look at the last year for which we have full financials, 2013. With net income of only $27 million, if the company took every single penny of company profits and gave them to you, you would get $9,000 per pilot. Every. Single. Penny. If you think the shareholders would put up with losing even a quarter of their pennies, let alone all of them, then you're delusional.
But that's not even the real problem. The real problem is that the net income figure is deceptive. The situation is actually far worse. Those profits only appear because of depreciation schedules spreading the capital expenditures out over many years. The real picture is painted by the cash flow statement. Republic lost $235 million in actual dollars that year. We don't have the final 2014 numbers yet, but the preliminary TTM numbers are even more brutal. Just in 2012, Republic had $1.1 billion in total assets on the balance sheet. Today that number is only $399 million. And the trend isn't improving.
Stop listening to what the angry guy in the crew room is telling you. He can't math, either.
Let's look at the last year for which we have full financials, 2013. With net income of only $27 million, if the company took every single penny of company profits and gave them to you, you would get $9,000 per pilot. Every. Single. Penny. If you think the shareholders would put up with losing even a quarter of their pennies, let alone all of them, then you're delusional.
But that's not even the real problem. The real problem is that the net income figure is deceptive. The situation is actually far worse. Those profits only appear because of depreciation schedules spreading the capital expenditures out over many years. The real picture is painted by the cash flow statement. Republic lost $235 million in actual dollars that year. We don't have the final 2014 numbers yet, but the preliminary TTM numbers are even more brutal. Just in 2012, Republic had $1.1 billion in total assets on the balance sheet. Today that number is only $399 million. And the trend isn't improving.
Stop listening to what the angry guy in the crew room is telling you. He can't math, either.
Beefy McGee
Well-Known Member
falconvalley
Absentee Dad of the OOTSK, Runner, Cat Frustrator
Oh hell no, Todd. It's not that simple. Have those spazoids don't even know what a balance sheet is. They get all their information from the EBoard Prez.
It's no secret that my company has a lot of debt and not a lot of cash. But the fact is that they make more than single digits in profit, consistently. But this isn't a simple argument. There's a reason the airlines would rather pay another company a fee to fly 70 seat jets around. So, I agree with you in a micro environment. But this isn't just a micro environment. I fly with really senior guys who have the money, schedule, and excuses. The rest of us don't have that and I get it. That's the whole point, right?
But they're gonna have to pay us, Todd, or they're gonna lose us, and maybe the company, too! Perhaps they won't have the mold-fitting financial provider if they do, but the money is there and they have a choice. You throw some depressing figures out, yet the company runs and people invest in it!
I realize that we are flying these things because the airlines wanted to protect themselves from the financial hit of flying less than 100 seat aircraft around, but somebody's gotta do it. I'm standing by my opinion. It isn't as easy to "try" being an airline pilot anymore. Somebody's gonna have to take a loss on that Ohare to Moline leg, be it RAH, AA, or Greyhound. If they don't raise the pay, they won't get any takers.
It's no secret that my company has a lot of debt and not a lot of cash. But the fact is that they make more than single digits in profit, consistently. But this isn't a simple argument. There's a reason the airlines would rather pay another company a fee to fly 70 seat jets around. So, I agree with you in a micro environment. But this isn't just a micro environment. I fly with really senior guys who have the money, schedule, and excuses. The rest of us don't have that and I get it. That's the whole point, right?
But they're gonna have to pay us, Todd, or they're gonna lose us, and maybe the company, too! Perhaps they won't have the mold-fitting financial provider if they do, but the money is there and they have a choice. You throw some depressing figures out, yet the company runs and people invest in it!
I realize that we are flying these things because the airlines wanted to protect themselves from the financial hit of flying less than 100 seat aircraft around, but somebody's gotta do it. I'm standing by my opinion. It isn't as easy to "try" being an airline pilot anymore. Somebody's gonna have to take a loss on that Ohare to Moline leg, be it RAH, AA, or Greyhound. If they don't raise the pay, they won't get any takers.
BobDDuck
Island Bus Driver
Except there are outfits that can do that ORD Moline leg and make money. The issue of course is you are going to be doing it in a Dash8-100 or a 402, but it will go and the company WILL make a profit. Republic doesn't have the right aircraft for that mission (short, thin routes with super low density) and are flying them in addition to the longer, fatter routes. They DO have the right aircraft for that mission but the profit margin (based on what the majors are willing to pay) is so low that it doesn't offset the costs of the other stuff.
That's the future of the industry. You'll have the lower end places like Cape Air and CommuteAir cover the ultra short haul routes and then you'll have the 190s and CSeries of the world (on a mainline seniority list) covering the "regional" non big city routes. The "regionals" as we know them today may survive in a few places but in general their time is limited.
falconvalley
Absentee Dad of the OOTSK, Runner, Cat Frustrator
Oh I agree. But the money is there. It has to be or the business dies. My argument is oversimplified. Where I can find cash, someone else could find a debt bill. My point was that the money is there. My company did offer a raise (in the TA that we turned down). Is it enough to bring pilots willing to sit in the right seat for a while? I don't know. When I snarkily said "profits", I was being snarky, because you need those to survive. I wasn't saying the Regional Model is a cash cow. I do believe that pay is going to have to go up, though. If that means it drives companies like mine out of business, then that's life, I guess. I was willing to grit it out for a bit and forced to longer than I ever imagined. I have patience, too. And I'm also financially careful and a little fortunate, too. But I don't know if today's market will bring in enough pilots to support this model. In fact, I highly doubt it.
SlumTodd_Millionaire
Most Hated Member
Delusional. Purely delusional. I just showed you that the money is not there. The company's balance sheet is shrinking like it's in a cold pool. Wake up!
ComplexHiAv8r
Well-Known Member
But ther're too big to go out of business. GM will never go BKATN_Pilot said:
z987k
Well-Known Member
Perhaps a return of fuel efficient turboprops.
falconvalley
Absentee Dad of the OOTSK, Runner, Cat Frustrator
You're only taking into account a snapshot in time, bro. I don't immerse myself in finances with any emotion whatsoever. I'm quite familiar with my company's financial roadmap and why they lay it out the way they do. Nothing is nailed so tight that it can't be altered. What you're assuming is that I'm saying that they can afford to give me a raise right now. What I am saying is that to staff this airline, they need to raise the pay and that they have the ability to do that. I can only wonder what that would mean, financially, because they have a lot of cash locked up. It is what it is. They demand a supply of pilots and it's just not happening. We might even be past the point where them making a simple change in pay will make a difference. They are parking aircraft faster than they can say they need to. Did I mention that upon our normal schedule posting date, they had yet to even "receive" flights to build pairings with from Delta for our 145 program? Of course, they blame this squarely on Delta, when in reality it was us that caused that and Delta was reacting to it. This isn't because we don't have the cash to pay newhires more, Todd. It's because we don't have the newhires to staff the planes in the interim. If they raise the pay, there's a slim chance that would change. Tell me that you don't firmly believe that they are at "Penny Zero" for any wiggle room on that balance sheet. I'm talking pure mathematics here and not merely share earnings and sticking with that in a fanatical sense, which will kill this company in less than 3 years, if the management team doesn't sell us out first.
SlumTodd_Millionaire
Most Hated Member
No, I'm looking at 10 years of financials, actually.It just happens to get worse over time.
Clearly. But you should.
In fact, they do not have the ability to do that. At least not by much. You're assuming that staffing the airline is the top priority. It isn't. Generating value for shareholders is. If you reach a point where you can no longer turn a profit because labor and other costs exceed what you can get for your product, then the best value to shareholders is liquidating assets. Bedford either needs to come up with one hell of a good FFD deal in the next five years or so, or he'll need to find another regional carrier looking to make an acquisition. Delta seems to be putting their eggs in the Endeavor basket, since Endeavor is wholly owned. They won't throw massive amounts of cash at Republic for pilot retention bonuses, and neither will UAL. The reverend is going to have to save himself, and he doesn't seem to be doing a very good of it so far.
