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[Breeze] Airways
12-27-2023, 09:23 AM
#4561
Gets Weekends Off
Joined APC: Mar 2023
Posts: 354
You posted they were doing great in Q2 and Q3. I think you said they told you so in a CP pilot call. Are they lying in their Form 41 data about the incredibly poor performance? Margins in the industry are going down not up. What do you base your latest profitability forecast on?
12-27-2023, 10:08 AM
#4562
New Hire
Joined APC: Oct 2022
Posts: 7
12-27-2023, 11:47 AM
#4563
Gets Weekends Off
Joined APC: Jan 2022
Posts: 498
Bottom line, the financials are not good. However, revenue looks to have increased significantly. The company is definitely burning cash. If the margins don’t start to reduce down to single digits it will be difficult to survive. Start up capital was 300mil- with the numbers… it can’t be doing well. Unfortunate, because I think the plan was to continue long term rather than just as a sell off/acquisition like Avelo.
12-27-2023, 12:25 PM
#4565
New Hire
Joined APC: Oct 2022
Posts: 7
I’d probably say they can survive quite a bit longer than that, the airline game is tough. But these companies find ways to survive. As long as they can continue revenue growth and manage costs. I imagine 23Q4 will be better for them as they reduced hiring, slowed training and likely had increased demand (Nov/December).
12-27-2023, 01:27 PM
#4566
Gets Weekends Off
Joined APC: Feb 2008
Posts: 19,704
One thing for sure, when wallstreet gets back to work next year DN is going to be having some very serious discussions with the investors.
12-27-2023, 01:36 PM
#4567
Gets Weekends Off
Joined APC: Feb 2008
Posts: 19,704
They did do great considering in Q2 they went from -130 margin to -28 a year later with 3 or 4 times the revenue. Id say that’s not bad. They told us rising fuel prices starting this past October will push the profitability projection further into 24. They just brought in a second A220 sim.
12-27-2023, 09:22 PM
#4569
Gets Weekends Off
Joined APC: Mar 2023
Posts: 354
Raising additional capital might not be as easy as some think. They probably will need to negotiate with the 3 main capital providers depending on the terms. Raising additional capital would reduce the value of the original trenches. I am sure they can find the money but they will pay a huge interest premium since they have no assets for collateral. Maybe DN will pony up some of his own cash this round! Most startups as posted struggle a bit. I have never seen the kind of negative margins Breeze is posting. JetBlue was profitable within a few quarters of starting operations. Avelo is running single digit negative numbers but very manageable.
One thing for sure, when wallstreet gets back to work next year DN is going to be having some very serious discussions with the investors.
One thing for sure, when wallstreet gets back to work next year DN is going to be having some very serious discussions with the investors.
JetBlue was started during a much different industry climate, cheap fuel, lots of pilots available etc. Avelo is probably looking at short term operations before they sell, who knows. DN is betting big a different way now on underserved markets. The more RJs get parked and the more legacies abandon secondary routes due to rising costs, the better Breeze does. The one really good thing we have going is customer satisfaction, apparently it’s the highest in the domestic market, it’s no surprise though if you’re bypassing hubs to get to where you want to go. In this industry if people want to fly you, things usually workout in your favor. It would certainly be much easier to get funding.
12-28-2023, 01:00 AM
#4570
Gets Weekends Off
Joined APC: Mar 2006
Position: guppy CA
Posts: 5,171
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