Member Info for groots

Yes, and the market reaction shows it was the correct move.
Many credit lines are setup without being drawn down.
Quite a lot of businesses who took out CCFF loans "just in case", didn't use them and paid them back.

"There is plenty of cash in the coffers to manage even slowly evolving circumstances over a couple of weeks. That's how I look at."..... Yes, but CFOs need to always think of worst case scenario. Hence this deal.

They don't need it just now. That's the whole point. They aren't drawing it down because there is no immediate need for it. Would you rather they didn't have it, so if we went back into lockdown they need to scramble about/go bust? It is literally the definition of prudence.

It is not debt big blue. Not until it has been drawn down .
“ British Airways intends to draw down only if and when required and the facility will not be utilised upon signing.”

As for your “why would they do this” comment. It’s called prudence. Would be reckless to not have such an arrangement if travel ended up locking down again

BB.
1 - BA are not taking on any new debt just now. They have signed an agreement to be able to take up to £1bn in cash within the next 5 years if need be.
2 - Ryanair are are putting a sale on to try and obtain 100% capacity to build on their quarterly profit and reduce the full year loss. It's not as if they are lowering prices in an attempt to stave off insolvency, no need for doom and gloom!

Whether people like it or not, that credit facility announcement puts an RI way on the back burners for the time being. Based on the announcement, travel outlook would need to deteriorate for BA to even draw down a portion of the facility, never mind draw down the full £1bn and THEN require a further injection of cash (RI).

Lets hope we get a full winter season flying to and from the US!

If an RI is to happen, it will be for one of 2 reasons:
1) we go into lockdown and travel is cancelled again and IAG need emergency cash (in that case, people should have more to worry about than their stocks and shares portfolios - the wider economy would be decimated).
2) The board want to reposition the Group to make the most of the Covid recovery, i.e. buying up more slots, refitting aircraft etc. In this case, short term 'dilution' (as you put it) would be the price for enhanced long term gains (btw can I point out that a standard RI does not dilute your shareholding/cash position unless you ignore your rights. Take them up or sell = no worse off).

@BB - London to Lagos was one of BA's most profitable pre covid routes. 4 weekly flights with club world 95%+ full. The recent codeshare deal signed with Kenya Airways will only enhance their African presence.

Where is all the IAG hate coming from? Yes they have taken on lots of covid debt, but as far as airlines go they are a leader in the western world. People forget that the last results pre covid reported a 4 billion Euro operating profit. This is an airline Group that was flourishing pre covid, not struggling. Thomas Cook comparisons are laughable and show a lack of industry knowledge.

As much as I'd love that to be true (long term holder), I find it hard to believe as a lot of the 747 fleet is now in pieces lol

BB, in the long run, the cost of debt is far less than the cost of equity.

Highly confident that if the current restrictions (i.e. day 2 lateral flow test, minimal red list) are the worst we see again then the risk of an RI is minimal. A full US winter will help bolster the balance sheet. I can see BA sending 3 or 4 full triple 7s to New York daily in the run up to Xmas.

In the above scenario we should see a steady rise towards £2, and then onwards to £2.50 if we get a full spring/summer with no restrictions.

All my opinion, and of course another lockdown or increased travel restrictions would through a massive (potentially RI shaped) spanner in the works).

so the list will remain, with 0 countries on it?
https://www.bbc.co.uk/news/uk-59063818

Not knowing the difference between cash operating costs and net cash burn would suggest your opinions are misguided

Broker ratings these days aren’t worth the paper they are printed on. Heathrow costs are of course a concern though if the airline don’t want to increase prices too much. That plus oil rise will hit BAs margins

All travel stocks seem to be on a downward trend just now. Potentially some wider bad news? External factors are at play here, this drop isn’t just based on the health of the IAG balance sheet

T5 was pretty busy yesterday. Sat in the plaza lounge watching a BA plane take off every few minutes. All 4 flights I was on over the last week were at least 80% full so let’s hope they are all like that!

Rumoured dates of the Americans opening their borders (8th November) and this share picks up. Imagine my shock…

Redundancy, whilst a short term hit, is far cheaper in the long run. Especially if a large chunk of employees are short serving

“ PS - IAG have NOT formally stated no RI. They suggested to a newspaper it's not their intention at the time.
It's a cometh, you know it, the market knows it.”

If the market knows it then the price won’t be dramatically affected when it is announced then :)

I believe the fashion industry causes more pollution than air travel (10% of world pollution is clothes production, vs 25% for ALL modes of transport). Are we all to run around without clothes now? And stop eating beef?

I agree that airlines will come under attack, but they are also the ones who need to work for a solution as air travel can't go away. Greener planes will become a thing.

Key west on Boxing Day and Chicago on the 1st! What about you?