Feb 23 2009
A pregnant Virgin
An interesting story in the news today puts Virgin Blues value at less than the value of a new Boeing 777. Ironically Virgin Blue took delivery of a brand new 777 earlier this month, which in my mind at least is comedy gold. Basically if you were Qantas or any other large airline and you in the market for some additional planes, you would be better off purchasing Virgin Blue lock stock and barrel to gain access to their fleet, then purchasing a new 777 from Boeing. Its not such comedy gold for the poor old Virgin Blue shareholders but this thin glimmer of hope should give them some sort of comfort… that their business isn’t completely worthless…. nearly but not quite.
With a shareholder equity of 925 million dollars and a long term debt of 1,182 million dollars and a profit this year of 92 million Virgin can basically service their existing debt and have enough left over for a vegemite sandwich. They are indeed pregnant with debt! Couple this with a less than reliable earning history and less than excitable economic climate and it might be time to give this Virgin a wide berth.
Richard Branson’s old adage “How do you create a millionaire? You take a billionaire and sell him an airline business.” has never been truer. Kind of makes me wonder why he got into that business in the first place…. Oh now I remember, create a business with a lot of hype around it, pander to the market and media, sell out to a billionaire (the billionaire was Chris Corrigan and the market by the way) and leave behind an eaten out shell. I’m not saying there is anything wrong with this, it’s not illegal or anything, I am just surprised it happened.
Interesting, so you think Virgin Blue a complete scam created by Richard Branson to take money from an unsuspecting public. That is one to many hash bars for you my friend.
Try sticking to believable stories along the lines of football and horse racing mate.
Dont speek down on Virgin Blue. It is just the financal crisis that is causeing all the problems its nothing to do with what your talking about. Prefer you to not right about things you do not understand.
Ah Jethro, if your english gets any worse we’ll have to get IASM to interpret for us.
Rob B, amazing that you think SJ is on drugs with such an “outrageous” story, yet when it’s reported word for word in the Sydney Morning Herald next week it’ll all of a sudden become gospel.
IASM, have you worked out your error from last week yet?
The reason Branson got into the airline business is because of the hostees, boys.
Jethro, you obviously have shares in VB which is why you are so defensive.
SJ, wouldn’t they lease the planes or something rather than buy them outright, you should check that before you jump to too many conclusions.
IASM, is having dinner with Sir Dick in Melbourne now so whne he gets back to the hotel room he cna fill us in………btw IASM…you can jam your white flag……
And he should be proud of the fact that he’s reintroduced some talent into the industry after the grumpy old crones Qantas have made us put up with for so many years.
I saw Branson in the lounge in Melbourne this afternoon and he was on his way to get on a flight, so if anything he and IASM are newly registered members of the mile high club…how does it feel to be a pin-cushion IASM?
Well well well Tigger & the Fat One return. Unfortunately they remain humourless unintelligent losers!
Fat One, congrats on getting the Virgin Lounge cleaners job.
Top quality come back as usual……………..
All I cleaned up IASM was a couple of beers and most of the antipasto platter.
Well Fat One you’ll be back on the unemployment line before you know it.
I’ll be sure to say hello to your dick when I see it there.