First glance analysisThe whole comparison below will be Comparing Q1/21 to Q2/21
In Q2
-Revs were up by $183M (So deliv. 3 larger planes, prob., 2 G7500 & 1 G6500)
-Margin was 14% on sales. This # has to climb to 20% and the G7500 is the key.
-EBITDA margins were up by .2% to 9.4%, that's still low IMHO. The G7500 prob.
-Net Income from Ops. was a diff. of almost $390M to a gain of $139M for Q2.
-Diluted EPS was almost a $.17 cents diff. higher in Q2 to $.6 cents.
-Adjusted Net Loss was down by $36 to $137M in Q2 (I'll discuss it further later)
-Cashflows from Cont Ops were up by $527M in Q2 (This is a huge diff. from Q1)
-PP&E was up by $31M (probably for Service centres, and Pearson's G7500)
-FCF usage was a diff., of $496M less than Q1 to a +FCF gain of $91. (Bravo)
-Officially they delivered 29 planes in Q2. 17 large 9 Medium, and 3 Lears.
-Finally they were left with $2.288B in cash on hand
So IMO they have improved tremendously. Revenues are going to be a little less, in Q3 but the Margins may be up because of G7500, and therefore we'll see FCF+ again to around $100M. Adjusted net loss to me is the key here. It's gone down by almost $36M from Q1 to Q2, but I'll take this big change from the $400M cashburn from Q1. I suspected that they were doing something like writting off $400M less in receipts from the Alstom Sale, and I still think that. That was the big diff., from the $496M FCF usage from Q1, down to a plus $91M.
So as I see things. My guess was right when I was doing the LTD #'s with Jim, that they would have about $2.3B on hand after Q2. They actually have $2.288B. I still believe that they will use the $1B from the $2.288B reserves to take out the LTD of $514B in Oct.2022, & the $534B of Jan 2023, and clear the RUNWAY until Dec. 2024. That will leave them $1.288B on hand and also that's when around then they'll take a LOC of $1B + or minus. That will reduce their LTD down to $6.3 and that's when the B shares will FLY.
I don't think that the LTD reduction will happen any earlier than May of 2022, and I think that they may hold off with the line LOC for a while too, till the end of summer of 2022. But rest assured the LOC is going to happen next year. They are smart doing that, because they still have their own cash to use for now, and that's when they are going to get a better sense, of how much of a LOC they need for Ops, because they'll get 1 year under their belts of Operating BA. Hopefully they'll have the G7500 Pearson plant going by summer of next year, because that will even give them a better indication of Operating Expenses.
I think that Credit Ratings Agencies, will give them a BBB- or + credit rating by the end of next year, and that will HELP with the refinancing of the Dec. 2024 maturity.
Given what I saw on this Q2, I think that Q3 and Q4 will bring some good FCF+ quarters, and no cashburn, by the of this year Q4/21. That's why I think that the shares, will still linger in the $2.50/Share, closer to the year. But by June of 2022, watch out. Cheers