RE:RE:RE:TD First look145, cash burn - No know. Its a fairly complex business of progress payments, etc... made even more complex by the sprawlingness of it all. It will help to unload CRJ and Belfast, and BT, the picture will be clearer after that...will still be a good franchise, the CEO will still be good, but it seems to me at least that the balance sheet will still be liable to fluctuations that we don't begin to understand.
You're absolutely right on BT - CDPQ is now unofficially the backstop to the Alstom deal which is a real positive. Unfortunately, the proceeds are being used for daily operations
As the SP goes down, it makes me realize that we are not out of the woods. I believe the plan as it is to focus on BA and pay debt down isnt enough. They'll have to let go some people, and they have to refinance the debt to pay less interest, Boeing interest rate and terms would be fair...
bbdbinvestor145 wrote: In a nut shell what you said is pretty well it, for Q1 Pablo.
I think they're starting to use credit for a cheaper interest alternative. But it doesn't bode well for Cash Burn. Where are they using the money, I'll never know? Do you? Legacy, overhead, wages, operating income, inventory????????
If they can keep cash burn down in Q2 we'll be ok, but it will be a challenge. I think that, with the CRJ gone it should alleviate some of the that burn. Every CRJ going out the door is at a loss. Then follow that with Belfast going out the door, should help. I think the wage part of this scenario has created havoc for the Bomber. I can wait for all these wages to disappear. I just want to see the 14,000 employees left on payroll for BA. I'm done with BT and their overinflated personel problems as well. I just want to see a clean balance sheet period.
If they can manage to save around $4B by the end of 2020. Then we'll be in good shape to take down the debt. Thank god that CDPQ isn't insistent on a minimum reserve balance. I think that $4B is achievable even with the covid-effect. If you notice CDPQ is right there with cash for operations and taking equity for it. They have no choice. They're protecting their investment. They'll easily take 49% of BT if the Alstom deal is Kaput. In fact, either way. The $9.5 debt is going to be substantialy dealt with in early 2021. About time. It could be as low as $3B from my math if Alstom buys BT. Or as low as $6 if we do the equity deal with CDPQ either way this process is finally coming to an end. They're making headway with everything. The SP should start recovering in the next 5 to 6 months. All in all covid hasn't devestated the Bomber plan like it did to Boeing and Airbus and even some other Bomber competitors.
I knew MHI had the cash and need to buy the CRJ program. They don't trust Boeing period. Too bad that stupid Bombardier decided NOT to sell the CSeries to MHI as well. They would have been great to deal with and we would have easily gotten about $3B to $4B out of MHI. But Airbus rammed it up our AZZ. There Canada or QUEBEC who's ever fault it was insisting on Bombardier selling it to Airbus. SHAME on the BOMBER too for listening. Because ULTIMATELY it was the Bombers program, and they could have done anything they chose to do with it.
The CSeries was a double mistake. First giving it away for nothing and then even offering to expand the program with cash calls for Airbus, for Alabama and who knows what else, after giving it to them for free. When I was telling this to everybody here on this board? They were arguing with me. How stupid can someone be to give 50% for free first of all? But then to boot you pay them more money to expand the program knowing full well that they are going to buy the program from you at certain price that you haven't even decided on, and you can't do nothing about ti. Yet you keep pouring money into it, and you can't even have the right to take back the program from them(Airbus). Hey I'll be damned if I can answer that. Other that STUPIDITY.
I think Martel is going to be fine. You can tell by the subdued manner of the Q1 call, that the rah rah rah manner of the team under Bellemare is gone. It's just as well. They had nothing to be proud of under Bellemare. They we're just PIMPS.
Cheers
145
pablo87 wrote: Consumed a lot more cash than I expected (not only cash balance went down but they borrowed on BT's line, CDPQ invested more and they got $500M+ from ACLP) but balance sheet actually getting cleaner. Wait and see on Q2 because Martel unlike Bellemare may want to under promise and over deliver. Interesting that CDPQ took more equity. Definitely in need of low interest loans to buy back some LTD.