RE:RE:RE:Interest on LTD vs EBITDAPablo.
When Bart finished answering Noah P's question about EBITDA. EM popped into the convesation
to shed a little light on the inventory reduction from 2019 to 2020.. He said that the reason the inventory went down by $1B year to year was from Covid on some of the G7500 deals. In fact I'd estimate that it had to have been about 10 to 13 planes.
But EM's take on it was this. Those cancelled deals were early sales of G7500's. So now BA has those extra slots to sell to BJ operator companies, quickly and at a higher margin than the original lower selling prices. Plus the cost savings from the learning curve savings after the 50th delivery.
So this is shaping up well. The EBITDA is getting tighter and easier to predict. So is the FCF positive curve because of that. Like I said the company's Jack-in-the-box activity has wound down.That's why the lousy Q4/2020. I'd rather that lousy wind down of the BT, than destroy the whole of 2021. Plus now they've cleared the balance sheet for BA. Cheers
PabloLafortune wrote: Thank you for sharing. Reading those transcripts, you might be excused if you didn't realize that AB and JDB have been replaced by EM and BD. They may not have been skating on thin ice like their predecessors but they were skating nonetheless. That said, the way BD was talking you got the sense he had something up his sleeve which he will reveal on March 2nd. Also, never seen the bankers so positive given the answers...the 2021 vs Q4 EBITDA explanation was pure fluff.