QF still not budging on claimed 31 Oct 2021 resumption of non-NZ intl flts

Melburnian1

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From 'The Oz' during late arvo, Monday 11 April 2021:

(a great way for Qantas/ Jetstar to promptly avoid paying refunds! If many passenger intl flights operate from 31 Oct, I'll find a hat and eat it):

'Qantas is holding firm on its planned return to regular international services on October 31, despite the Prime Minister’s admission the majority of Australians will not be vaccinated against COVID-19 until 2022.

The airline announced in February international flights would recommence to most of its pre-COVID destinations in late October instead of July, based on the federal government’s vaccination program.

At the time, Qantas CEO Alan Joyce said the airline would require passengers on all but domestic and trans-Tasman flights to be vaccinated for their own safety as well as that of crew.

In a statement released late (sic) Monday, Qantas said they were “closely monitoring the recent developments in the rollout of vaccines in Australia”.

“The government has not updated its timeline for the effective completion of the vaccine rollout and at this stage there’s no change to the planned restart of our international flights,” said a Qantas spokeswoman....'
 

mviy

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Anyone who booked to travel soon after QF hopes international travel will resume, has to have been prepared for the fact that there was a significant chance that international travel would not resume that soon.

I personally have no plans to book international travel till the vaccine rollout has progressed a lot more and there's a lot more clarity as to when travel is likely to resume.

I also want to be vaccinated before travelling, and as I'm in 2B, I will be waiting a while.

The government is giving QF handouts. Presumably if the government decides that international travel is unlikely to resume till say next year they could decide to tell QF you're getting public money and international travel almost certainly won't resume till next year so you better stop taking bookings for flights before then.

The travel ban can only be extended for 3 months at a time though, and the Federal government is keen to start to wind back travel restrictions as soon as the Health authorities tell them it is safe to do so. This will require some co-operation from the states, however.
 

mviy

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I’m not that pessimistic. I reckon Alan Joyce remains determined at the very least to sign the contracts for Project Sunrise, if not go on the first Sunrise flight before stepping down.

QANTAS can seek to raise further capital in the future.

Things may become clearer in June(?) when the travel ban gets extended again for another three months. At that point QF may cancel all international flights for the rest of 2021 except to NZ, if they haven’t already.
 

Melburnian1

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I’m not that pessimistic. I reckon Alan Joyce remains determined at the very least to sign the contracts for Project Sunrise, if not go on the first Sunrise flight before stepping down.

QANTAS can seek to raise further capital in the future.

Things may become clearer in June(?) when the travel ban gets extended again for another three months. At that point QF may cancel all international flights for the rest of 2021 except to NZ, if they haven’t already.

jb747 will have a better idea as to whether QF will solely become 'QFd' from 2024', but while QF may seek to raise further capital at some stage, there may come a point when financial institutions are less willing to loan to it, or shareholders to subscribe for new shares.

It's constantly losing money as the international (lack of) flights means huge daily maintenance costs for stabled aircraft. Some of our aviators on AFF have run through the costs and they're for items I'd probably not have even considered.

Interest rates appear on the way up so when QF's debt funding matures (not all concurrently), it's likely to pay a higher coupon rate. A rise from near zero to a small percentage doesn't sound much, but when financing costs rise, it's another unbudgeted hurdle to becoming profitable.
 
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mviy

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I don’t work in aviation but I’m speaking from my general understanding as to how things work in the financial world.


I’m talking about raising capital, not taking on more debt. If investors provide capital in exchange for newly created shares they can sell those shares if they wish to exit their investment on the share market.

QF would like international travel to resume again ASAP, and I think a part of that would be to best position itself to raise further capital. So they are going to be as reluctant as they feel they can be to cancel international flights before they have to.

If an institution feels the worst is behind QF then they may well be prepared to take the risk of providing capital by buying QF shares at a significant discount to the share price prevailing at the time. If that hurts the institutions that took up last years placement that would not concern a different investor. They care about their own chances of making money.

It seems almost certain to me that QF will try to raise capital at some point in the next year or two. Whether they succeed remains to be seen.

With an improved debt to equity ratio QF is more likely to be able to sustain international operations and eventually green light Project Sunrise.
 

Must...Fly!

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There is no shortage of capital available in the markets, and with a lot of legacy issues behind them with probably more to come over the next very bleak reporting year, I can't see how Qantas would struggle to find money.
 

Melburnian1

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QF would like international travel to resume again ASAP, and I think a part of that would be to best position itself to raise further capital. So they are going to be as reluctant as they feel they can be to cancel international flights before they have to.

You're 100 per cent correct that 'QF would like that' but it seems to me that it's peddling a mistruth to guillible, non-savvy travellers (who don't read AFF and who have no friends to advise or caution them) that somehow, magically, international flights beyond NZ will resume on 31 October 2021.

The chance of this happening is negligible at best, and QF knows that.

Accepting bookings is (to put it pleasantly) 'not nice' and falls short of responsible corporate behaviour.

QF is a publicly listed company for heaven's sake, not what used to be termed a '$2 shelf company' or a Phoenix-like resurrection.

'Caveat emptor' applies. Sure, we can laugh about the stupidity or unrealistic optimism of those who put mouse and debit/credit card to use booking, but it's not good for a company's reputation to repeatedly run some public story that X will occur when the top management, unless residing under a rock, must know it won't.
 

mviy

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One doesn’t have to like what they are doing to understand why they are doing it. At the moment QF needs all the cash they can get their hands on.
 
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I'm confident we will be able to travel early next year, and to that end, I booked J flights (points) to Tokyo for mid-January next year.

The government cannot keep us locked up forever.
 

mviy

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I think if Christmas is not allowed they'll wait till at least after the January school holidays are over before permitting travel but it'll be interesting to see.

When/if QF does cancel more flights it'll be interesting to see when they push out their planned resumption of travel to.
 
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Hmmm. Have you read what the Federal Government just said on Tuesday 13 April?
Sure did. Despite the prime Minister claiming there isn't a timeline on the vaccine rollout, there absolutely is. CSL has 3 million doses already manufactured and stored. All that is required is assay testing from the TGA and AZ. We will be moving forward soon.

As for concerns about the AZ vaccine, the statistics so far show that its rate of clots is far lower than many other commonly used drugs. I'm eligible for a jab now and will have no hesitation in getting AZ when the 3 M doses are released.

Once we reach 70% vaccinated it will be almost impossible for the government to keep the shackles on us, particularly with an election due in the next 12 months.
 

Berlin

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With the current delays in vaccinations, no way Aussies (or Kiwis, for that matter) will be allowed to happily travel to places like the US or Europe before 2022, as much as I would love to be incorrect. Exceptions like Singapore, Taiwan or Fiji maybe but that will be about it.

And seeing how Qantas stretches the timelines for refunds as far as they possibly can get away with (still better than the likes of AirNZ, admittedly), this is clearly just an attempt to get cash flow in. From a commercial perspective, I cannot even blame them- especially as many competitors are even worse with this.
 

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