Air Partner Share Discussion Threads

[masurenguy] 03/4/2018 16:24

LOL - what utter tosh ! The troll is getting really desperate now following on from today's earlier claims of shareholders being duped, shareholders suing the company, solicitors queuing around the block to exploit this fiasco, that Castlefield will be dumping their stock and now Jet Card customers panicking and pulling out their deposits. What a truly sad character !

[lbo] 03/4/2018 16:01

I wonder will it also make some customers panic? Some may start wondering about counter party risk with Air Partner and their JetCard cash being held by Air Partner which customers can ask to be refunded at any time.

[steeplejack] 03/4/2018 15:49

Fair comment by Paul Scott,that is the way it is.

[spacedust] 03/4/2018 15:22

Ndisabled in share price after all these trades last hr or so

[masurenguy] 03/4/2018 14:51

Paul Scott's view: "This seems to be saying that bad debts (i.e. amounts which had been invoiced to customers, but were not paid by the customer) were not written off through the P&L. Instead they were offset against a balance sheet creditor (deferred income).

This appears to be indirectly saying that prior year profits were overstated. Although I cannot be sure about that, as it depends on the nature of the deferred income. If bad debts were dumped into the (very large) deferred income creditor account, with no specific reason, or matching of related items, then that just sounds like false accounting to me - very concerning. However, we cannot be sure of this, as today's announcement doesn't give enough detail. It also refers to preliminary investigations. The size of the problem is fairly small, and spread over several years."

My opinion - "this is a tricky one as we don't yet have full information. If you are happy to give the company the benefit of the doubt, then it could be argued that a drop of about £15m in market cap today, for a £3.3m historic accounting issue, could be an over-reaction and perhaps presents a buying opportunity? However, following so soon from the calamitous turn of events at Conviviality the timing could hardly be worse. Maybe this disclosure could be the thin end of the wedge? Who knows?

Looking at the last reported balance sheet, at the interims as at 31 July 2017, it looks OK to me, although not particularly strong. As with many travel companies, it relies heavily on customers paying up-front, in advance of using the service.

Some key numbers;
NAV: £16.1m
NTAV: £7.4m
Current ratio: 1.1

The stand-out figure on the balance sheet, is £43.8m of deferred income - i.e. the opposite side of the double entry from cash received from customers. Total cash is £28.8m, so the whole business is financed by customer up-front payments. That's not unusual in this sector - airlines, and cruise ship operators typically finance operations in the same way. Overall, my feeling is that share price drop of around 20% today looks about right. It's very concerning that the company appears to be admitting to having falsely accounted for bad debts, and hence boosted cumulative reported profits by £3.3m.

There again, that's a relatively minor amount, and I don't see any signs that this issue alone would affect the viability of the business at all. The company has more explaining to do, and perhaps a change of FD is now needed? Based on today's announcement, I don't see any reason to panic. It doesn't look like another Conviviality. Let's hope those are not famous last words on the matter."

[lbo] 03/4/2018 14:02

From 2010- 2011 annual reporthttp://www.airpartner.com/globalassets/investors/annual-reports/2011-annual-report.pdfInternal ControlsLegacy issues have been tackled in this period. As set out above, a cash payment of £3.1 million was made in settlement of historic accruals.In July 2011, an announcement was made to the market concerning a potential liability for amounts of unpaid Federal Excise Taxin respect of past flights involving a US destination. Provision of £1.0 million was made by the Group, resulting in a restatementof retained earnings of £0.8 million and a reduction in current year pre-tax profit of £0.2 million. This estimate includes likely costs in relation to the tax, interest for late payment, any penalties and professional fees. The reasonableness of the Company's detailed calculations supporting the estimated provision has been independently reviewed by a leading accountancy firm. The Company has initiated discussion with the US Internal Revenue Service and the liability is expected to be resolved before 31 July 2012.Air Partner has strengthened its financial management team considerably and there have been significant improvements in processes and reporting procedures in the period under review. As a prudent step to minimise the likelihood that there were other significant legacy liabilities, it was also announced in July that a top four accountancy firm had been appointed to review control procedures and provide independent, additional assurance. This review has now been completed and did not identify any additional liabilities. The report did make some recommendations on improving internal controls, which will be implemented during the year.

[lbo] 03/4/2018 13:53

https://www.telegraph.co.uk/business/2018/04/03/air-partner-veers-course-33m-accounting-error/Broker Cantor Fitzgerald said that the issue appeared to have no bearing on Air Partner's cash balances now, but added that "pending further updates and greater clarity on this issue" it had decided to downgrade its rating on the company from 'buy' to 'hold'.

[masurenguy] 03/4/2018 13:49

Conviviality's auditors were KPMG who are around 1200% larger than Mazars. Furthermore, Mazars have not been AP's auditors for years - they currently use Deloittes, who are the second largest accountancy company in the UK.

[haroldthegreat] 03/4/2018 13:36

Mazars is ranked as the 8th largest UK accountancy firm by audit fee income, and we are one of Europe's largest accounting firms with a huge global presence. In the UK, we have 18 offices nationally: London

They were not a small firm shouldn't they have picked it up on audit ?

[spacedust] 03/4/2018 13:14

If this was aim we would be down 70% in 1st 30mins then up 50% from that point onwards.

Here check this....we could do with something like this

[spacedust] 03/4/2018 13:13

If this was aim we would be 70% in 1st 30mins then up 50% from that point onwards.

Here check this....we could do with something like this

[edmondj] 03/4/2018 13:07

Where a stock is listed can't guarantee capability/integrity of directors, especially with regard to giving a faithful view of the business, either way.

[steeplejack] 03/4/2018 13:03

Sadly,I'm cynical enough to know exactly what you mean.Thats why I'm only too relieved that this isn't an AIM stock.I think this is a rotten time for this accounting problem to surface.The markets are very skittish and thus unforgiving.

[lbo] 03/4/2018 13:01

Not even the board knows what's exactly going on yet never mind the funds!"preliminary investigations""principally relates to""inappropriately offset""the investigation continues""the Board presently understands""will update the market as appropriate"

[spacedust] 03/4/2018 12:55

Steeple you understood where I'm coming from. If this was major we'd have seen a tank in price last week. Only small private holders are selling. I'm a buyer at these levels. The business model has not changed. The contracts are still there

[pvb] 03/4/2018 12:51

Oh dear! This is AIR's second problem with the accounts, they 'lost' their original financial director, Stephanie White, some years ago.

2011? Is this related to previous problems?

[dontay] 03/4/2018 12:45

We only know what we know and imo we can be sure that the bod have made a complete disclosure of how things stand to date... and the are not yet in a position of understanding anymore than they have stated. The investigation is on-going. As member of the full stock exchange there is no way they could take the remotest risk in not being 100% open and truthful with the market on where they are at the moment in these circumstances. It will be interesting to see if Kieth Ashford-Lord holds off buying OR backs up the courage of his very long standing convictions and sees this as an opportunity to fill his boots again!

[steeplejack] 03/4/2018 12:39

No,what he’s saying is,the hedge funds are so privy to inside information that they would have known before the hoi polloi if the news of accountancy errors was that important.Interesting train of thought but doesn’t help to explain why the hedge funds,despite their nefarious activities have miserably underperformed tracker funds over recent years.Little knowledge is a dangerous thing perhaps,as is an underweight position in Amazon over recent years .

[lbo] 03/4/2018 12:29

How would they have knowledge of sensitive information before they released it publicly to the market?

[spacedust] 03/4/2018 12:22

The hedge funds and insti would have known about this in advance if it was a big deal

[spacedust] 03/4/2018 12:22

When everyone else sells the savvy buy. That's what is happening here. The error has led to share price taking a hit. Onwards....

I thought it may go down to 80p but it's just private investors selling so no big deal. Should rise from here. I say 125p finish on current trades

[lbo] 03/4/2018 12:19

I doubt Keith Ashworth-Lord will be as forgiving. If he applies the Buffet principles and what happened with the Tesco accounting scandal then he will at the very least be dumping the shares they recently acquired in Air Partner.

[masurenguy] 03/4/2018 12:09

What a lot of nonsense LBO. You have been trolling this thread for the past two and a half years criticising the company and its valuation. In that time it has more than doubled in price and paid 29.6p in dividends. Of course you completely ignore that fact.

I am a shareholder here and have not been "duped" nor would I consider taking "legal action" against them. There is clearly an historical accounting issue here that needs to be addressed and I'm sure that it will be in due course. You are just getting desperate with your consistent attacks here but then that is just very typical troll behaviour !