Originally Posted by
spin88
It sometimes helps to recall what people actually said. Way back in Post 110 dgcpaphd stated that since the changes were made by the new management team that UAL had lost "in excess of $1B". Way back in Post 116 Halls120 noted that UAL's liquidity had gone from 8.3B on 6/11, to 8.1B on 6/12, to $6.9B on 6/13.
Let's review the facts: since the merger (i.e. when changes where made to the management team), UAL has not lost in excess of $1B. And my response to Post 116 was to point out the decline in liquidity was not due to negative operating cash flow, but discretionary decisions on the part of management to repay debt and make significant investments.
Originally Posted by
spin88
Both are extremely valid observations if one is wondering if the new business model is working or is not working....
The problem is, people don't say, "I don't think the business model is working." They write numbers and unrelated anecdotes and say, "the data unequivocally shows the business model isn't working."
Originally Posted by
spin88
You stated that dgcpaphd was making up numbers,misleading people, was "explicitly false," and to Halls120 you claimed that UA was generating "positive cash flow" and not to worry about the liquidity, it was used to repay higher cost debt and invest in new planes. You spin was "ignore the numbers" they are not correct, this "savvy" management team has all of the answers.
UAL is generating positive operating cash flow - there is no "claim" on this point. Further, I never said not to worry about liquidity - I simply pointed out it is deceptive to attribute the decline in liquidity to weak operations when there are other factors to consider.
You last sentence is a misquote you seem insistent on repeatedly using. Why do you keep trying to goad me with emotional taunts?
Originally Posted by
spin88
I and others showed that in GAAP accounting UAL in fact since 1/1/12 (when the new MP program went into effect and the changes started in earnest) which is what the OP was referring too, UAL lost ($1.14B). Likewise in that same period (period when Jeff's plans were in place) UALs FCF was negative to the tune of ($1.063B). When you claimed you needed to use a 12 month trailing figure, another poster pointed out then the figure was ($900M) in negative free cash flow.
There is enough financial understanding on this board that you will not get far in just asserting everyone else does not understand the numbers.
I've never argued that free cash flow was positive, or that the losses for the most recent 5 quarters were another number. I've simply pointed out statements that were incorrect and why it doesn't make sense to use these metrics in the manner they are being applied.
My sense is that there's enough financial understanding in this forum for posters to pick and choose numbers that suite their position.
Originally Posted by
spin88
I for one am very interested in real analysis. If you think that the reduction in liquidity is as you suggest a good thing, then explain why and how the money was used. Did it result from the underlying operations under-performing (as I think) or was it just investments. For example, I have noted that UA has bought back debts and had to issue shares as part of these deals. That seems very expensive to me as it dilutes the ownership (by about 1%) but at the same time the debt is cancelled, so the net position of UA should be about the same. Yet, liquidity is down $1.1 B in a year, things I would be interested in knowing are how much has UAL actually invested, either in product upgrades or new planes?
Why and how the money was used is spelled out in the Statement of Cash Flows in explicit detail.
Originally Posted by
spin88
I know why jeff wants all of these new planes (he intends to try to compete with other airlines by being able to under cut them on fuel costs with new planes) but for example is a single minded focus on trying to shave fuel costs the answer, paid for in part by cutting soft product and jamming more folks into the hard product? What do you think are the financial implications of this move? DAL is adopting almost the polar opposite approach, why do you think Jeff is "savvy" and DAL's Anderson and Co are in turn goats?
Actually, Delta and American are reconfiguring many of its fleet types to increase seat capacity. This is a very, very effective way to reduce CASM.
Delta is unique in its desire to operate niche fleets of older aircraft. This is a pretty smart way to support lower utilization and in a network that has more seasonality than many of its peers.
Originally Posted by
WineCountryUA
Is this the metric you believe is more appropriate -- cash from operations?
http://ycharts.com/companies/UAL/cash_operations_ttm
Should not the falling number (about 1/2 2011 levels) since the start of 2012 (as operations merged) be of concern? Should not the synergies from merged operations be reflected here?
I am of the perspective that a business should generate as much operating cash flow as possible. That said, I stand behind the statement that UAL
is generating positive operating cash flow.
Originally Posted by
dgcpaphd
Once again you have made a well organized response with accurate information.
Considering that the other poster rejects amounts shown on the audited statements by UA's outside CPAs, perhaps he might better understand why he is incorrect if he reads this site:
https://en.wikipedia.org/wiki/Genera...ited_States%29
Logically, all of us who presented data from reliable sources, including the SEC site, cannot be wrong while only the other poster has the correct answers that conflict with the verifiable data we presented.
A reading of the site I recommended should make it clear to the other poster so that he can find his way through the SEC site and confirm that we are correct in the loss numbers we provided.
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Let's circle back to the beginning. You posted the following statement, "It is no secret that UA, since their contempt for passengers was announced, that UA has lost far in excess of one billion dollars. The losses can be traced back to poor management decisions," with a link to SEC statements that did not support such a claim. Only after the error in your statement was pointed out, and the concept of picking 5 quarters (which are not contained within any single SEC filing) was concocted, were you able to claim being correct.
I respect your opinion and understand your motivation to post what you do. However, when it comes to the black-and-white nature of financial statements, you're either right or wrong.
For what it's worth, I don't need a Wikipedia link to teach me about accounting.