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I am hearing that BA have served S 188 notices on the Pilots. Apparently 1080 pilot jobs are now under threat.
Additionally, apparently BA has now included the 'fire and re-hire' clause. If agreement is not reached between BALPA and BA, then the employment contracts of all pilots will be terminated and new contracts with new terms and conditions will be offered.
You have to wonder what BA are thinking .
Unless of course, they want to close down BA and start again.
Bloomberg
British Airways Threatens to Fire Pilots, Fights U.K.’s Quarantine Rule
Https://www.bloomberg.com/news/articles/2020-06-06/british-airways-threatens-to-fire-all-pilots-in-latest-salvo
Yes n brown may have more ‘debt’ than others but it also has a much bigger receivable than others too.
You can’t consider one without the other in a credit business, that’s the equivalent of assessing a business based solely on its costs and ignoring the revenue!
Spot on Ian B.
Also worth mentioning that the debt is only secured on the corresponding loan book so they are incredibly heavily linked. I.e if n brown did decide to default the corresponding amount of the loan book would be transferred over, with no claim to any other assets. This isn’t really standard debt and shouldn’t be treated as such.
This has always been the case with n brown and it makes sense, if you build a credit business where you don’t receive cash straight away and spread over a period you’re going to need some sort of debt to satisfy working capital requirements.
Thats why n browns debt is so much larger than others because of the credit element of the business, it’s very serviceable and as I say secured on the loan receivables only so not an issue. (Also it’s ridiculously cheap at the moment due to the incredibly low interest rates)
I’d imagine in the next trading update we’ll see n brown has reduced its net debt substantially, either by massively increasing its cash balance or then deciding to pay down some of the rcf which is essentially the only real debt the business has, the debt secured against their receivables won’t even cross their minds as it’s not an issue and would be the last thing you would consider paying off. However even so you could possibly make the argument that you wouldn’t even pay that off given how cheap it is and how much cheaper than any other debt would be.
BWNG in fact has the least "Total current liabilities" compared to SDRY and TED, all of its debt is in fact a long term debt due to the financing business -
I can tell you have only had a cursory look.See last trading update liquidity and financing sorted. Don’t confuse debt with the loan book. Paulof2 actually addressed uninformed posts Like yours on debt on ADVFN recently -
“The issue with n brown has always, and will always be that people see the big debt number and get scared off as they fail to understand the corresponding receivable of the massive loan book.
The stupid thing is that in a normal pre covid market they could easily sell off the loan book and pay off the debt so it’s not an issue at all but people simply don’t understand it.
While they could do that obviously it doesn’t makes sense to, I’m sure every stakeholder who understands the business would rather they service the debt which is based on us paper rates I.e peanuts and then receive the ridiculously high interest from the loan book instead.
Your valuation figures seem great but you are surely totally ignoring the 512million pounds loan which will need repaying at some point in a few years or refinancing. Also an 80% reduction in a marketing costs will lead to a much more severe hit to profits imo.
I'm fully expecting a rights issue here shortly.They will need the money to shore up their balance sheet.
Happy to be contradicted as I've only had a cursory look.
Well Bazza, I expect a good week next week as Mid June approaches as physical outlets begin to open their doors, HMSO also similar position had a rally Wednesday, yesterday seemed to be a bad day for most of the markets, but Indices have done well today. Hopefully futures will set a good opening margin for Monday.
So what’s everybody's thoughts for next week.
U/T 28.85 finish
£1.62 on January the 1st this year ksh
1.47 one year ago. This could boom like a coiled spring any time.... Glad it is getting the attention it deserves.
A nice run up to results Likely. On line sales is the way forward Post covid and they switched to digital Sales at just the right time.
The Group's audit is being conducted on an entirely remote basis and N Brown currently expects to release its results for the year ended 29th February 2020 in mid to end June 2020. A further announcement will be made in due course.
Solid buying activity. Hope it rises later today but can see a good week ahead next week.
This is the next one to recover - look at others with a heavier debt position - CINE, AML etc.
GLA.
No problem KSH, thanks for sharing here for me
Thanks Paulof2
@paulof2 - sorry mate - I've just lifted your message from the other BB. No plagiarism intended but it's worth highlighting the potential here.
Good research, thank you.
If anyone is interested, i've done a really rough calculation on the impact of covid, rolling through the trading update through their figures and i've posted on UK ADVFN if anyone is interested.. Unfortunately cant post here as it is way more than the character limit.
I'll just say it is incredibly promising and shows how ridiculous these current prices are..
Massively undervalued here. Take a look at the quality of the Board.
Covid plus the initial fall in price was a black swan event. Expecting a significant re-rate and hoping we will look back in a few months and be glad we bought at this price.
Well done gunz
Ha Rich, perhaps you need some new tea leaves ;-)
Rich160, check my post below yours. I predicted today and gave the reason
Sorry meant end of this week :)
Can see a rise into the results beginning end of next week as results are expected mid to late June. Got to 29p before they were last expected so expect a similar climb. From there, either a jump to 40/50 or retrace down to 15/19p depending on how bad debt / cash collection has gone. GLA
Many people have taken their money from Brown (n) to invest in other shares moving up at the moment but eventually will come back. Tomorrow many investors will be selling most of their other shares and buying here. Its never going to be this low, so Buy now and enjoy the ride.