US Airways Dividend Miles (Pre-FlightFund Merger) - You thought US Airways had it bad read this article...

http://biz.yahoo.com/ap/050310/delta_outlook_14.html

Does not make US look so bad after looking at that. Delta is going the same road US and UA. Others will eventually follow unless the get their act together now.

http://biz.yahoo.com/ap/050310/delta_outlook_14.html

Does not make US look so bad after looking at that. Delta is going the same road US and UA. Others will eventually follow unless the get their act together now.


uh, US looks plenty bad to me. Read the 10-K and the January financial results filing. Oh yes, and DL is not blowing through my tax dollars like a pig through slop either. The unrestricted cash balance is significantly below the ATSB loan amount now - kiss my tax dollars goodbye, cause I don't think US can recover with oil at $50+/barrel and still no cogent operating plan (including fare rationalization)

Your tax dollars are NOT going to be gone if US were have to go ch 7. If they were the ATSB woudl have all their slots, gates, planes ect. That was part of the agreement which is MORE than what the loan is.

Oh and give DL time. They sure will be once they have to file. Unless they make some drastic changes.

No upgrade with all the lurking and reading you are doing on US you must have at least known about that.

uh, US looks plenty bad to me. Read the 10-K and the January financial results filing. Oh yes, and DL is not blowing through my tax dollars like a pig through slop either. The unrestricted cash balance is significantly below the ATSB loan amount now - kiss my tax dollars goodbye, cause I don't think US can recover with oil at $50+/barrel and still no cogent operating plan (including fare rationalization)


ATSB is Guarantor of the loan. If US defaults and sinks into C7, the loan is still fully collateralized and the taxpayers are on the hook for ZERO.

Ans what about the pension???

Oh and give DL time. They sure will be once they have to file. Unless they make some drastic changes.


Umm...Simplifares-Good Goes Around; Song; DFW slimming & rolling giant hub with more flights at ATL were all nice changes that will hopefully help.

Ummmm.....GoFares; MidAtlantic Airlines; PHL becoming a rolling hub; FLL added as a Latin/Carribean gateway were all nice changes that will hopefully help.

One thing to note - DL's only unionized workforce is the pilots. Nobody else. Not gate agents, rampers, baggage handlers, reservation agents. Nadda. It's not too hard for DL to wring some cost savings out of them without a long negotiation battle, but at the same time they have to be careful not to open the doors to IAM, CWA, AFA representation (if they can actually build a case to the rank and file that they would be good for the workforce).

Here is yet another. Follow the directions to read the article.

http://www.flyertalk.com/forum/showthread.php?t=409715

Your tax dollars are NOT going to be gone if US were have to go ch 7. If they were the ATSB woudl have all their slots, gates, planes ect. That was part of the agreement which is MORE than what the loan is.

Oh and give DL time. They sure will be once they have to file. Unless they make some drastic changes.

No upgrade with all the lurking and reading you are doing on US you must have at least known about that.


You're kidding, right? Obviously you didn't read the 10-K, like I recommended. Not only is the cash flowing out like sewage into the East River, but the collateral is gone too. The planes are hocked to the gills with GE and others, they valued the slots and landing rights at a mere $36 mil, which is undoubtedly still too high as the two US airports that still are slot controlled have long-term plans to eliminate them, and they don't own any "gates". In fact, they "sold" the landing bridges in PHL to satisfy some past due payables with the airport authority!

So when its time to pick the carcass, the pickings will be slim indeed.

As an aside, somehow they still have $2.5 billion in goodwill on the books - if that isn't impaired - they need to rewrite the accounting standard (again)


BTW - did you see that they recently captured a crocodile in Ghana which had eaten 83 people?

Not only is the cash flowing out like sewage into the East River, but the collateral is gone too. The planes are hocked to the gills with GE and others, they valued the slots and landing rights at a mere $36 mil, which is undoubtedly still too high as the two US airports that still are slot controlled have long-term plans to eliminate them, and they don't own any "gates".

a little clarity is in order. What, exactly, does US Airways own and owe (as of 1-31-05, the latest 8-K reporting period)?

Their assets fall into 3 classes: current, capital, and other. Current assets stand at $1.27bn...
Cash and cash equivalents $543,063
Restricted cash 100,984
Receivables, net 288,456
Materials and supplies, net 165,927
Prepaid expenses and other 169,768
Total Current Assets 1,268,198

Capital Assets, planes and buildings etc, are held on the books at $3.4bn. It is unlikely they could be sold for that today, however....
Flight equipment 3,300,563
Ground property and equipment 374,565
Less accumulated depreciation and amortization (333,977)
Purchase deposits for flight equipment 93,007
Total Property and Equipment 3,434,158

Other Assets are recorded at $3.6bnm, but unfortunately most of this is worthless intangible assets, like Goodwill...
Goodwill 2,489,638
Other intangibles, net 529,350
Restricted cash 554,216
Other assets, net 93,694
Total Other Assets 3,666,898

So, while total assets are listed as $8.3bn, it would be more realistic to dock that by $3bn in intangibles, and perhaps another $1.3bn in illiquidity of equipment values. That leaves roughly $4 bn.

Where does ATSB stand? first in line, and they're owed only about $700m. thus, there is zero chance of them not getting repaid. Ditto Air Wisconsin, as long as the firm remains in bk court.

What does US owe? well, the DIP creditors are listed as Current Liabilities, a category coming to about $2.4bn:
Current maturities of debt 729,539
Accounts payable 379,851
Traffic balances payable and unused tickets 861,909
Accrued aircraft rent 7,408
Accrued salaries, wages and vacation 171,474
Other accrued expenses 293,378
Total Current Liabilities 2,443,559

The remaining debts are "noncurrent", and even after the pension plan cancellation, they amount to about $5.5bn...
Deferred gains and credits, net 43,286
Postretirement benefits other than pensions 1,906
Employee benefit liabilities and other 242,102
Total Noncurrent Liabilities and Deferred Credits 287,294
Liabilities Subject to Compromise 5,231,828
Total Noncurrent Liabilities 5,519,122

That makes for Total Liabilities of $7,962,681, and maybe $4bn in Assets. Call it $8 and $4 bn.

Take out the DIP players, and that's roughly $1bn off each side.

So other creditors are owed $7bn, which has $3bn is assets behind it. Essentially that means enough to satisfy GE, and leave everyone else high and dry.

Step right up, Mesa Air!

Thank you Martin33 for the excellent financial analysis.

The fact that delta airline has financial problems does not make usairways look better. delta has the back-up of american express and I believe it would survive. on the other hand usairways has lousy management and unhappy employees that take their frustration on the passengers. I flew usairways and delta and I can attest that delta is much better. I just can not understand these massive losses , 6 million dollars a day. I hope it would not be another enron or worldcom.

I hope it would not be another enron or worldcom.
US Airways does not invest in semi-phony subsidiaries or off-shore corporations in some Carribean island or overstate its earnings (or put some misleading statements), etc..
At least nothing illegal to my knowledge. The only problem is low fares, high fuel, and competition.

You're kidding, right? Obviously you didn't read the 10-K, like I recommended. Not only is the cash flowing out like sewage into the East River, but the collateral is gone too. The planes are hocked to the gills with GE and others, they valued the slots and landing rights at a mere $36 mil, which is undoubtedly still too high as the two US airports that still are slot controlled have long-term plans to eliminate them, and they don't own any "gates". In fact, they "sold" the landing bridges in PHL to satisfy some past due payables with the airport authority!

So when its time to pick the carcass, the pickings will be slim indeed.

As an aside, somehow they still have $2.5 billion in goodwill on the books - if that isn't impaired - they need to rewrite the accounting standard (again)


BTW - did you see that they recently captured a crocodile in Ghana which had eaten 83 people?

No upgrade for you,

I suppose you read Martin33's post by now (Thanks Martin, there is no way I could have posted all of that!!) You also might want to know is that a "Gate" and a "Jet bridge" are two different things. The jet bridge is what connects the gate to the airplane. I actually learned that as well.

US Airways like many carriers LEASE their gates either from the airport or the city like many other carriers. Some have many year leases and some are on month to month leases.

NJD,

Delta has American Express??? How long do you think American Express is going to hang in there? 5 Billion in loses last year makes US Airways looking like they lost a drop in the water.

From the article: "A restructuring under Chapter 11 of the U.S. Bankruptcy Code may be particularly difficult because we pledged substantially all of our remaining unencumbered collateral in connection with transactions we completed in the December 2004 quarter as part of our out-of-court restructuring," Delta said in the filing.

US Airways like many carriers LEASE their gates either from the airport or the city like many other carriers. Some have many year leases and some are on month to month leases.

NJD,

Delta has American Express??? How long do you think American Express is going to hang in there? 5 Billion in loses last year makes US Airways looking like they lost a drop in the water.

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US Air did pull a fast one, with regard to gates, on the Philadelphia taxpayer. They agreed to sell their PHL gates (which they did own) to the airport authority, and subsequently to lease them back. The gross effect was to move current cash into US Air and out of the Philly taxpayer's pocket, on the promise of (uncertain) future lease payments. In net effect, the deal is tantamount to a subsidized loan from Philly's taxpayers to US Airways. It's dressed up, of course, but the cash flows are indistinguishable.

In any event, January's performance more than burned up the sale proceeds.

High fuel prices always kill a few carriers, it was the last straw for Eastern.

On many routes I am still paying what I did 10 - 15 years ago.

Pres. Bush has proposed an increase in taxes / fees for airline passangers.

So much for "read my lips." I am reading Bush's lips and they are saying tax increase. That would knock another carrier out.

Congested hubs are good at wasting fuel and increasing expenses due to misconnections.

The fact that delta airline has financial problems does not make usairways look better. delta has the back-up of american express and I believe it would survive. on the other hand usairways has lousy management and unhappy employees that take their frustration on the passengers. I flew usairways and delta and I can attest that delta is much better. I just can not understand these massive losses , 6 million dollars a day. I hope it would not be another enron or worldcom.

$6M a day during the (likely) worst month of the year baffles you, yet you hold Delta up as an example? Delta lost $5B last year. Thats almost $14M/day for an entire year!

If you hate US so much, why do you continue to fly them? Why read and post to this board?