BEWARE $30,000 BOND FOR 3 YRS

[Tbayer2021]

But no pay raise to help people stay?
What's the strategy here?

To get more applications than resignations probably lol.

[Jim la Jungle]

But no pay raise to help people stay?
What's the strategy here?

It's called negotiating for a collective agreement in due course.

[TFTMB heavy]

But no pay raise to help people stay?
What's the strategy here?

Until the flight attendants have a ratified TA there will be no moves monetarily from the company. Who knows, they might even feel like they can wait till our CA is due to be opened or AC gets a good deal and we start loosing more pilots than we already are.

[Brakefans]

How do you like your chances of getting a substantial raise now?

Last quarter, Transat lost roughly 15 million from operations and paid 24 million in interests. Stock is trading near its ATL and market cap is around 100 million. Competition is fierce and flooding the market (CDG, LGW, LIS, FCO…). For a company that’s meant to be is the recovery phase it sure looks like it’s back to its old habit of not performing well.

[rudder]

How do you like your chances of getting a substantial raise now?

Last quarter, Transat lost roughly 15 million from operations and paid 24 million in interests. Stock is trading near its ATL and market cap is around 100 million. Competition is fierce and flooding the market (CDG, LGW, LIS, FCO…). For a company that’s meant to be is the recovery phase it sure looks like it’s back to its old habit of not performing well.

PAH should buy Transat AT.

I am guessing, however, that there is a poison pill in place by the TRZ BOD in the event of an unsolicited takeover.

Perhaps a friendly takeover? Or a consensual merger of the corporations?

Food for thought. Set aside the fleur-de-lys issues and look at it pragmatically. Only real issue is the TRZ balance sheet.

[DanWEC]

Reviving a 6 month old thread with an account who's only posts are to aggressively yell at Transat pilots. Weird, but anyways since I'm bored I'll bite. Beats doing drywall today and no golf for a few more hours....

Historically Transat posts profits in q1 and q2 less than 50% of the time, and in those cases they're tiny. The real profit usually comes from q3 followed by q4.

The problem now is running costs and reduced margin due to interest and cost. It's not market share or economy, it's as Rudder said, the balance sheet. Revenue is up I believe 12% YOY, so there is no problem with the fundamental requirement of business- customers coming in the door.

The loss is in overall accounting. There was still a positive net income reported as opposed to a loss. Debt has still been reduced and paid down. One account being closed up.
They've added $100m in cash since 2023, $435m from $322m.

The major issue is lack of yield, the 2024 margins aren't what they forecasted and planned for.

The P&W GTF issue is the biggest hit to the margin, causing an upgauge across the board to older 330s to compensate for the grounded neos.

P&W is now beginning to pay out. Spirit is getting $8.9m USD in compensation per airplane, (Not all cash, I believe in some form of credits.) totalling some $230m. Transat will be getting a comparable amount per tail, which is supposed to offset the loss attributed to the defect by 100%.

Lastly, since AC will have to adjust pricing accordingly to cover their increase in labour costs, the pricing pressure will alleviate as TS will follow commensurately. (What, like 5 bucks a ticket? Bankruptcy according to every airline's mgmnt! )

The joint venture with Porter should be interesting as the different phases come into effect. But as for purchase.... I've said this before, I can't imagine anyone buying TRZ's debt, that would just solidify it. Once some sort of solution is in place and the net value of TRZ is higher (Could even be CCAA, a la AC Holdings) then we'd probably see some movement.

The debt is the true giant shackle, and they're still working on solutions while paying it down. You'd think once the Fed gets to a half billion or so in interest they'll start to think about some form of forgiveness.... who knows.

Of course, it's obvious that it's not the best time to negotiate while the company isn't skyrocketing, they'll definitely use it as a bargaining chip- but the cost of doing business is the cost of doing business. I'm not *too* concerned especially following AC's negots.

This is all publicly available info btw.

Cheerio

[Brakefans]

Reviving a 6 month old thread with an account who's only posts are to aggressively yell at Transat pilots. Weird, but anyways since I'm bored I'll bite. Beats doing drywall today and no golf for a few more hours....

Historically Transat posts profits in q1 and q2 less than 50% of the time, and in those cases they're tiny. The real profit usually comes from q3 followed by q4.

The problem now is running costs and reduced margin due to interest and cost. It's not market share or economy, it's as Rudder said, the balance sheet. Revenue is up I believe 12% YOY, so there is no problem with the fundamental requirement of business- customers coming in the door.

The loss is in overall accounting. There was still a positive net income reported as opposed to a loss. Debt has still been reduced and paid down. One account being closed up.
They've added $100m in cash since 2023, $435m from $322m.

The major issue is lack of yield, the 2024 margins aren't what they forecasted and planned for.

The P&W GTF issue is the biggest hit to the margin, causing an upgauge across the board to older 330s to compensate for the grounded neos.

P&W is now beginning to pay out. Spirit is getting $8.9m USD in compensation per airplane, (Not all cash, I believe in some form of credits.) totalling some $230m. Transat will be getting a comparable amount per tail, which is supposed to offset the loss attributed to the defect by 100%.

Lastly, since AC will have to adjust pricing accordingly to cover their increase in labour costs, the pricing pressure will alleviate as TS will follow commensurately. (What, like 5 bucks a ticket? Bankruptcy according to every airline's mgmnt! )

The joint venture with Porter should be interesting as the different phases come into effect. But as for purchase.... I've said this before, I can't imagine anyone buying TRZ's debt, that would just solidify it. Once some sort of solution is in place and the net value of TRZ is higher (Could even be CCAA, a la AC Holdings) then we'd probably see some movement.

The debt is the true giant shackle, and they're still working on solutions while paying it down. You'd think once the Fed gets to a half billion or so in interest they'll start to think about some form of forgiveness.... who knows.

Of course, it's obvious that it's not the best time to negotiate while the company isn't skyrocketing, they'll definitely use it as a bargaining chip- but the cost of doing business is the cost of doing business. I'm not *too* concerned especially following AC's negots.

This is all publicly available info btw.

Cheerio

The engine issue is an interesting one. It shows how vulnerable one can be when operating only 1-2 types of aircraft. Transat is currently footing the bill, explaining part of the operating loss.

Transat doesn’t necessarily adjust price of tickets when expenses go up. They charge as much as the market can bear. If no one else operates YQB-FLL-YQB direct and they can get away charging 2000$ for a return trip, they will regardless of their costs. My point is yields appear to be getting crushed on most of their markets this summer (CDG, LIS, FCO) and it’s a question of time before players enter the rest (Bordeaux, Nantes, porto). Prices are down but AC/AF can rely on connections, alliances, lounges, business travellers, aeroplan…

They are doing the right steps, trying to replicate/add what’s missing (porter JV, connecting pax..). My understanding is also that they will launch a point program by the end of 2025.

But it’s going to be a tough mountain to clim. Transat has lost over a billion since 2015. Not a single profitable year since then if I’m not mistaken. And I guaranty AC/AF/TAP/BA/KLM will continue to add capacity.

And in the meantime, they’re unable to refinance their debt (been over 4 years now of them trying) and employees want to catch up with inflation.

[kiaszceski]

2017, 2018 and 2023 were cash flow positive.

[Brakefans]

P&W is now beginning to pay out. Spirit is getting $8.9m USD in compensation per airplane, (Not all cash, I believe in some form of credits.) totalling some $230m. Transat will be getting a comparable amount per tail, which is supposed to offset the loss attributed to the defect by 100%.

They got 25 million total in the form of credits for 2023-2024.

[Stratopaused]

Historically Transat posts profits in q1 and q2 less than 50% of the time, and in those cases they're tiny. The real profit usually comes from q3 followed by q4.

Q3 results are out, and they're not good: https://ca.finance.yahoo.com/news/trans ... 00080.html Revenues are down despite load factors being up, EBITDA decreased by $73.5 million, net loss of $40 million vs profit of $57 million for the same quarter last year, negative free cash flow of $168 million , and they burned almost $210 million in cash and cash equivalents. They have $361.9 million in cash and cash equivalents remaining, but $792 million in debt and $1.5 billion in lease liabilities. The Pratt & Whitney compensation is in the form of credits for engine purchases, so that's not going to help them with liquidity. Their market cap is down to $70 million, and credit card processors and MROs are withholding larger deposits, so neither their investors nor their suppliers have confidence that they'll continue as a going concern.

Without intervention by the Quebec government, will they last another 18 months? Maybe even Flair will outlive them.

[DanWEC]

Not good at all.
If there's any silver lining it's that they don't have a problem with bookings, it's making a profit with all the current issues and liabilities. Market feasibility would give all thumbs up otherwise.

Million dollar question that's giving rise to some serious talks at home is when the cash runs out will they:

A)Fold and shut the doors like so many others.
B)Continue operating under CCAA, and emerge self sustaining/get bought because the debt is gone, or
C)Get propped up by the gov't as they've suggested before?

The pilots are needed everywhere, but what, 700 guys start interviewing all at once and restart at year 0 somewhere? Not a fun proposition for guys who aren't 25, Transat is the career airline for everyone who has a few years in, and hundreds have decades of YOS.

[cdnavater]

Historically Transat posts profits in q1 and q2 less than 50% of the time, and in those cases they're tiny. The real profit usually comes from q3 followed by q4.

Q3 results are out, and they're not good: https://ca.finance.yahoo.com/news/trans ... 00080.html Revenues are down despite load factors being up, EBITDA decreased by $73.5 million, net loss of $40 million vs profit of $57 million for the same quarter last year, negative free cash flow of $168 million , and they burned almost $210 million in cash and cash equivalents. They have $361.9 million in cash and cash equivalents remaining, but $792 million in debt and $1.5 billion in lease liabilities. The Pratt & Whitney compensation is in the form of credits for engine purchases, so that's not going to help them with liquidity. Their market cap is down to $70 million, and credit card processors and MROs are withholding larger deposits, so neither their investors nor their suppliers have confidence that they'll continue as a going concern.

Without intervention by the Quebec government, will they last another 18 months? Maybe even Flair will outlive them.

Yikes, those numbers seem worse than what we’ve read about Flair, that being said, when Flair execs say anything, I picture snake oil salesman from the late 1800s.
As DanWec, I feel for you, that’s a tough position to be in, are you first out and start over or last out still starting over but if you have faith that they will figure it out, you stay and talk about that time when years down the road. There is also the other possibility, you leave and they figure it out while you started over elsewhere.
Not an easy decision to make and it’s mostly due to the way we go bottom of the list anywhere we go, I would just go down with the ship and then undercut all other pilots when another company starts a company within a company and hires DEC
I wonder if the Porter/Transat partnership will become a true partnership? That would be a serious cash infusion though, probably more likely after a trip through bankruptcy

[Stratopaused]

I can't see anyone buying an airline that has almost $750 million in debt and doesn't own any of its own aircraft. The total assets they own is about $40 million worth of real estate. Porter would be better off waiting for them to shut down and then picking up their aircraft from the lessors than they would be in taking on that kind of a burden.

[DanWEC]

Absolutely nobody is buying the company. Most of the LEEFF would become immediately payable due to change of control, then the rest of the debt would be concrete and no wiggle room to get it forgiven. That would be an insane purchase.

The only way out is loan renegotiation, CCAA, or business improvement.
I could see TS looking attractive to a buyer again post CCAA, and also self-sustaining.

[rudder]

Absolutely nobody is buying the company. Most of the LEEFF would become immediately payable due to change of control, then the rest of the debt would be concrete and no wiggle room to get it forgiven. That would be an insane purchase.

The only way out is loan renegotiation, CCAA, or business improvement.
I could see TS looking attractive to a buyer again post CCAA, and also self-sustaining.

Restructuring is much more complicated than that. This isn’t a tv ad offering to extricate a customer from credit card debt.

Step 1.

Apply for CCAA.

A court must agree to order that the creditors cannot force the insolvency of the company. And since creditors do not offer services for free (past service obligations protected by the court order. Current and future services are not), a form of bridge financing must accompany the petition to allow for continuation of operations during the restructuring. That will involve a third party, typically a secured creditor.

Step 2.

Propose a restructuring plan.

Remember - it is the unsecured creditors who vote on the plan, and ultimately will become the new owners. You have to meet their needs and expectations, not your own.

Step 3.

Secure an equity infusion.

Once again, typically a third party who will take a significant ownership stake in the restructured enterprise.


Fail at any step and it will lead to either insolvency (in the instant) or court supervised liquidation.

When your mortgage is worth more than the house - and you do not have the cash flow to sustain the payments - you will hit the wall.

I hope it works out for the TS employees. But these results are surprising and concerning. Whatever the new c suite is doing is not yet manifesting financially and it will be interesting to see if there will be meaningful cash flow improvements in the near and medium term. The competitive landscape is what it is and all operators are seeing a downward trend in yields.

[Localizer]

It’s fun watching pilots pretend to be business savants. Pilots can barely negotiate a good contract in Canada .. let alone have a finger on the pulse of a business.

[cdnavater]

Q3 results are out, and they're not good: https://ca.finance.yahoo.com/news/trans ... 00080.html Revenues are down despite load factors being up, EBITDA decreased by $73.5 million, net loss of $40 million vs profit of $57 million for the same quarter last year, negative free cash flow of $168 million , and they burned almost $210 million in cash and cash equivalents. They have $361.9 million in cash and cash equivalents remaining, but $792 million in debt and $1.5 billion in lease liabilities. The Pratt & Whitney compensation is in the form of credits for engine purchases, so that's not going to help them with liquidity. Their market cap is down to $70 million, and credit card processors and MROs are withholding larger deposits, so neither their investors nor their suppliers have confidence that they'll continue as a going concern.

What part of the above report gives you the warm and fuzzy about the future of AT?
The market has been pulling out, I suspect most stock holders now are at a loss and just trying to ride it out!
Good load factors but lost millions, just under 800 million in higher interest debt and 1.5 billion in lease liabilities, creditors are starting to get nervous, therefore, it doesn’t take a business savant to see what’s going on here.

[kozak_letun]

With all this hanging over everyone’s head, how many meaningful gains will the pilot body be able to get in May?
Are there generally agreed upon must have items? Starting pay, company contribution to benefits, open time etc.?

[Babar350]

With all this hanging over everyone’s head, how many meaningful gains will the pilot body be able to get in May?
Are there generally agreed upon must have items? Starting pay, company contribution to benefits, open time etc.?

None, the company will go through CCAA and the contracts will be locked until out of bankruptcy.
Best bet is WJ or AC now.

[737Drver]

Is Transat hiring?