Covid-19 coronavirus - effect on Cathay Pacific
Dec 20, 2020, 8:39 am
#1306
Join Date: Jun 2018
Posts: 415
Indeed, profit and cash are two different concepts.
A loss-making company can have a good cash position by borrowing and increasing its equity base. To survive on a daily basis, a company needs cash to pay for its operation
But a company that consumes a lot of cash and expects huge losses in the coming years will have a very difficult time accessing the marketplace for more loans or equity. That leaves the government for major injections.
I admire your claim that impairment losses can be easily reversed. Not sure how to do it. CX has only "impaired" a very few aircraft. Whatever the optimistic outlook in the coming two years, they will need far fewer aircraft than currently owned. Impairment losses will keep piling up.
Restructuring losses are both cash and accounting losses (like paying redundancy allowances). They cannot be reversed. Your argument seems to be that CX has overstated the restructuring costs. Conversely, I believe that the restructuring plan conceived many months ago, will have to be extended now that the future air travel picture has deteriorated.
All these are not "accounting gimmicks". And the UK news of a more infectious mutation is not good.
A loss-making company can have a good cash position by borrowing and increasing its equity base. To survive on a daily basis, a company needs cash to pay for its operation
But a company that consumes a lot of cash and expects huge losses in the coming years will have a very difficult time accessing the marketplace for more loans or equity. That leaves the government for major injections.
I admire your claim that impairment losses can be easily reversed. Not sure how to do it. CX has only "impaired" a very few aircraft. Whatever the optimistic outlook in the coming two years, they will need far fewer aircraft than currently owned. Impairment losses will keep piling up.
Restructuring losses are both cash and accounting losses (like paying redundancy allowances). They cannot be reversed. Your argument seems to be that CX has overstated the restructuring costs. Conversely, I believe that the restructuring plan conceived many months ago, will have to be extended now that the future air travel picture has deteriorated.
All these are not "accounting gimmicks". And the UK news of a more infectious mutation is not good.
Don't be worried about refinancing activities from CX. Don't forget Hong Kong is a financial center. You can also check the responses for the Airport Authority financing for its Third Runway Project.
https://www.hongkongairport.com/en/m...e/2020/pr_1454
As for accounting, it's better to read through these accounting rules. HK adopts IFRS.
https://advisory.kpmg.us/articles/20...uirements.html
https://www.iasplus.com/en/standards/ias/ias36
As for new variants in UK, I strongly suspect that this is more like a political move from BoJo's government, persuading his Conservatives friends to tightening social distancing rules.
Dec 20, 2020, 8:46 am
#1307
Join Date: Sep 2018
Programs: Alaska
Posts: 2,188
As for financing process, simply speaking, investors will focus on a firm's [operating cash flows], or [the ratio of operating cash flows to interest expenses]. The operating cash flows are nothing about the depreciation/impairment. Another important metric is net debt to equity ratio, also called [gearing]. CX's gearing was largely improved by government's capital injection.
Don't be worried about refinancing activities from CX. Don't forget Hong Kong is a financial center. You can also check the responses for the Airport Authority financing for its Third Runway Project.
https://www.hongkongairport.com/en/m...e/2020/pr_1454
As for accounting, it's better to read through these accounting rules. HK adopts IFRS.
https://advisory.kpmg.us/articles/20...uirements.html
https://www.iasplus.com/en/standards/ias/ias36
As for new variants in UK, I strongly suspect that this is more like a political move from BoJo's government, persuading his Conservatives friends to tightening social distancing rules.
Don't be worried about refinancing activities from CX. Don't forget Hong Kong is a financial center. You can also check the responses for the Airport Authority financing for its Third Runway Project.
https://www.hongkongairport.com/en/m...e/2020/pr_1454
As for accounting, it's better to read through these accounting rules. HK adopts IFRS.
https://advisory.kpmg.us/articles/20...uirements.html
https://www.iasplus.com/en/standards/ias/ias36
As for new variants in UK, I strongly suspect that this is more like a political move from BoJo's government, persuading his Conservatives friends to tightening social distancing rules.
Dec 24, 2020, 6:56 am
#1308
FlyerTalk Evangelist
Join Date: Jul 2006
Location: Hong Kong, France
Programs: FB , BA Gold
Posts: 15,562
I was looking at the airport traffic of the past three days.
Arrival numbers are dismal: 21st 250 pax, 22nd 626 pax, 23rd 371 pax. And that is for all airlines, so CX may get half of that.
Departures numbers are a bit higher, possibly because of expats who lost their job and leave, or expats who go on holiday back to their family.
But I have never seen such low pax arrival numbers.
Arrival numbers are dismal: 21st 250 pax, 22nd 626 pax, 23rd 371 pax. And that is for all airlines, so CX may get half of that.
Departures numbers are a bit higher, possibly because of expats who lost their job and leave, or expats who go on holiday back to their family.
But I have never seen such low pax arrival numbers.
Dec 25, 2020, 2:49 am
#1309
Join Date: Apr 2001
Location: HKG/HND/OOL
Programs: QF Emerald. SQ Gold.
Posts: 3,170
I was looking at the airport traffic of the past three days.
Arrival numbers are dismal: 21st 250 pax, 22nd 626 pax, 23rd 371 pax. And that is for all airlines, so CX may get half of that.
Departures numbers are a bit higher, possibly because of expats who lost their job and leave, or expats who go on holiday back to their family.
But I have never seen such low pax arrival numbers.
Arrival numbers are dismal: 21st 250 pax, 22nd 626 pax, 23rd 371 pax. And that is for all airlines, so CX may get half of that.
Departures numbers are a bit higher, possibly because of expats who lost their job and leave, or expats who go on holiday back to their family.
But I have never seen such low pax arrival numbers.
i dont see how cX makes it thru.
Dec 25, 2020, 5:48 am
#1310
FlyerTalk Evangelist
Join Date: Jul 2006
Location: Hong Kong, France
Programs: FB , BA Gold
Posts: 15,562
clearly hk govt is de-facto closing its boarder. hearing all quarantine hotels full when govt suddenly changed quarantine rule to 21 day thus nobody can extend from its 14days rendering their arrival eligibikity at laat minutes, smart move (source: https://news.rthk.hk/rthk/en/compone...abChangeable=0 )
i dont see how cX makes it thru.
i dont see how cX makes it thru.
The SCMP reports that hotels are only 40 to 50% full and much less than was expected.
It could be that some of the cheapest hotel are indeed full and that can create problems.
Dec 25, 2020, 6:42 am
#1311
Join Date: Aug 2012
Posts: 6,752
These numbers are just stunning. If necessary, any insights on the HK Govt's position on providing more short term financing to help CX bridge the gap for, say, the next 6 months?
Dec 25, 2020, 2:20 pm
#1312
Join Date: Apr 2001
Location: HKG/HND/OOL
Programs: QF Emerald. SQ Gold.
Posts: 3,170
https://www.dimsumdaily.hk/foreign-d...-confirmation/
if you scroll down, regarding the agency for helper, it says
"He stated further that at present, almost all designated hotels are fully booked, and it is not possible to book rooms for 21 days at all. "
so is this high quality intel or not hard to say, but thay was reported.
but doing mathmatics, 12k rooms for quarantine gobt secured, 300 arrivals a day.as you checked, so i struggle to validate authenticity of claim.
Dec 25, 2020, 6:29 pm
#1313
FlyerTalk Evangelist
Original Poster
Join Date: Dec 2004
Programs: CX Green, QF Platinum, BAEC Silver, Hyatt Glob
Posts: 10,780
sorry, the "full" conment in this one
https://www.dimsumdaily.hk/foreign-d...-confirmation/
if you scroll down, regarding the agency for helper, it says
"He stated further that at present, almost all designated hotels are fully booked, and it is not possible to book rooms for 21 days at all. "
so is this high quality intel or not hard to say, but thay was reported.
but doing mathmatics, 12k rooms for quarantine gobt secured, 300 arrivals a day.as you checked, so i struggle to validate authenticity of claim.
https://www.dimsumdaily.hk/foreign-d...-confirmation/
if you scroll down, regarding the agency for helper, it says
"He stated further that at present, almost all designated hotels are fully booked, and it is not possible to book rooms for 21 days at all. "
so is this high quality intel or not hard to say, but thay was reported.
but doing mathmatics, 12k rooms for quarantine gobt secured, 300 arrivals a day.as you checked, so i struggle to validate authenticity of claim.
Dec 25, 2020, 6:54 pm
#1314
FlyerTalk Evangelist
Join Date: Jul 2006
Location: Hong Kong, France
Programs: FB , BA Gold
Posts: 15,562
I am sad to have so much free time to devote to these FT activities. Becoming a hobby.
When you look at the list of flights with positive cases (https://www.chp.gov.hk/files/pdf/flights_trains_en.pdf), many come from Manilla or Jakarta. As most helpers are from there, it might be that many incoming helpers have tested positive. Not surprising that HK gov does not wish to make it easy (costly) for those arriving pax to reduce their number. Just a guess.
When you look at the list of flights with positive cases (https://www.chp.gov.hk/files/pdf/flights_trains_en.pdf), many come from Manilla or Jakarta. As most helpers are from there, it might be that many incoming helpers have tested positive. Not surprising that HK gov does not wish to make it easy (costly) for those arriving pax to reduce their number. Just a guess.
Dec 26, 2020, 4:24 am
#1315
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 19,802
Jan 28, 2021, 2:06 am
#1316
FlyerTalk Evangelist
Join Date: Jul 2006
Location: Hong Kong, France
Programs: FB , BA Gold
Posts: 15,562
It was unfortunately expected that CX would soon need more cash.
With the new quarantine measure the monthly cash burn is announced at HKD1.9 billion and there will be several required investments and reimbursements requiring more cash.
CX announced a HKD6.7 billion convertible bond sale:
https://www.scmp.com/business/bankin...tress-finances
Today CX share price lost 10%.
With the new quarantine measure the monthly cash burn is announced at HKD1.9 billion and there will be several required investments and reimbursements requiring more cash.
CX announced a HKD6.7 billion convertible bond sale:
https://www.scmp.com/business/bankin...tress-finances
Today CX share price lost 10%.
Feb 23, 2021, 5:43 am
#1318
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 19,802
Feb 23, 2021, 9:55 am
#1319
Join Date: Jun 2003
Posts: 1,953
But, it is also worth noting, even if wishful thinking: "The bureau pointed out that extending the expiry dates of the relevant regulations does not imply that the restrictions currently imposed will be maintained until the corresponding expiry dates."
Feb 26, 2021, 11:54 pm
#1320
Join Date: Jun 2018
Posts: 415
https://news.cathaypacific.com/catha...ong-and-beyond
CX will operate 2 weekly Hong Kong-Brussels cargo-only flights, while it previously ceased passenger service there.
It is also interesting to see that the made-in-China vaccines from Beijing for Mexico were transited in Hong Kong, handled by CX.
CX will operate 2 weekly Hong Kong-Brussels cargo-only flights, while it previously ceased passenger service there.
It is also interesting to see that the made-in-China vaccines from Beijing for Mexico were transited in Hong Kong, handled by CX.