International Consolidat... Share Discussion Threads

[m1k3y1] 01/6/2020 15:26

Arai....I don't believe it for a second.
Lots of pent up demand just waiting for the signal to say it is ok to fly.

The airline CEO's are using the pandemic as an opportunity to cut their workforces and costs.

BA/IAG is the worst example.

[hamhamham1] 01/6/2020 15:02

Am having a terrible time today with De La Rue...
103.20 GBX +62.45 (153.25%)

[m1k3y1] 01/6/2020 10:25

logan...almost all of them elected by their citizens.

[applepieinthesky] 01/6/2020 09:51

Bunch of shysters this lot at IAG

[loganair] 01/6/2020 09:41

Q. What do all the countries that have the highest number of Covid 19 deaths have in common?

A. They are all run by Alpha Males who lack any real leadership and govern by Dividing & Distracting rather then governing in the best interests of their people.

[m1k3y1] 01/6/2020 09:26

Quarantine: Airlines lobby ministers to exempt 45 ‘air bridge’ countries

[topazfrenzy] 01/6/2020 09:17

Decided to sell for a small profit, the Moody's note makes it all too risky still, the funds will keep selling this down

[silkstag] 01/6/2020 08:27

Passengers flying in from airports deemed by the EU’s aviation safety agency (EASA) to be in areas with “high risk of transmission of Covid-19” will be required to stay overnight in a designated hotel for testing. “If the test is negative then the passenger self-quarantines for seven days,” said a statement released by the Greek foreign ministry at the weekend. “If the test is positive, the passenger is quarantined under supervision for 14 days.” Chocks away, not!

[ny boy] 01/6/2020 08:17

Easy money adding on Pull backs here!

(DLAR) the next big recover play imo

[sikhthetech] 31/5/2020 15:24

watford,
"We have a country that has a large number of ignorant, stupid and selfish people."

Exactly... The govn have been sending mixed messages...

Please do this or that, pretty please... do this 'UNLESS' you have exceptional circumstances...


You can't enter UK after 8th June without going into quarantine but you can this week...

You should take a car home UNLESS you are unable to in which case you can use the crowded public transport because we've eased lockdown a week before the new rules come into effect...

crazy...

[watfordhornet] 31/5/2020 15:12

Look at Trafalgar Sq, look at house parties in Hackney last night, look at the queues at the UK beaches.We have a country that has a large number of ignorant, stupid and selfish people.In Greece when told people do it. Same in Hong Kong - far more densely populated, share border with China but when told to lock down they did. HK have a few deaths in total - it is crazy

[sikhthetech] 31/5/2020 15:08

The UK has more new infections and deaths on avg in ONE day than Greece had over the entire period of the lockdown..

Currently, people arriving into UK can still wonder around... as the Quarantine doesn't come into effect for another week...

Recipe for disaster...

There needs to be confidence in the way the outbreak is being handled. I don't think that confidence exists..

[m1k3y1] 31/5/2020 09:57

Mail
Ryanair to cut fares by HALF in war on rivals: Michael O'Leary determined to fill planes even if it means losing money

[jailbird] 31/5/2020 04:43

Rating Action: Moody's downgrades IAG to Ba1 from Baa3; outlook negative
28 May 2020
London, 28 May 2020 -- Moody's Investors Service, ("Moody's") has today downgraded International Consolidated Airlines Group, S.A. (IAG or the company): the rating agency has assigned a Ba1 corporate family rating and Ba1-PD probability of default rating to IAG and withdrawn the company's Baa3 long-term issuer rating. Concurrently Moody's has downgraded the ratings of the company's €1 billion senior unsecured notes divided into €500 million series A bonds due 2023 and €500 million series B bonds due 2027 to Ba2 from Baa3. The outlook has been changed to negative from ratings under review. This concludes the review for downgrade initiated by Moody's on 17 March 2020.

A full list of affected ratings can be found at the end of this press release.

Today's rating actions reflect:

• The increasing duration and severity of the coronavirus outbreak

• Moody's expectation that the airline industry will remain deeply constrained in 2020 and 2021 and will not recover 2019 passenger volumes until 2023 at the earliest

• Despite current substantial liquidity, risks that financial resources could be under pressure from further coronavirus outbreaks and extended restrictions on air travel

• The likelihood that the company will incur substantially increased debt during the coronavirus pandemic, and faces challenges to recover its balance sheet in the next two to three years

• The company's scale, strong market positions, global network and high profitability

RATINGS RATIONALE

The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The passenger airline sector has been one of the sectors most significantly affected by the shock given its exposure to travel restrictions and sensitivity to consumer demand and sentiment. Today's action reflects the impact on IAG of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered.

IAG was initially impacted by the coronavirus outbreak in February and early March 2020 with restrictions on flights to and from China, the United States, Italy and other regions. As the outbreak spread the company reduced its capacity by 94% in April and May, and has announced that it could see capacity reductions of 50% for 2020.

Moody's expects flight activity to resume over Q3 and Q4 of 2020, but remaining severely depressed, with domestic flights recovering earlier and a slower return for international and long haul flights. With around 67% of capacity outside Europe and a high exposure to business travel and premium leisure, Moody's expects that as flights resume IAG will see a slower recovery profile than the industry as a whole. The United Kingdom's current plans to quarantine international air passengers arriving from Ireland are also likely to affect IAG's ability to resume meaningful volumes in 2020.

The International Air Transport Association (IATA) currently forecasts that 2020 global passenger numbers will be 48% down year-on-year, with 2021 volumes around 30% below 2019, and only recovering to 2019 levels by 2023[1]. Given high levels of uncertainty of the trajectory of the pandemic there are a wide range of possible outcomes and Moody's credit assessment considers deeper downside scenarios incorporating the risks of a slower recovery. In particular Moody's considers that 2021 is likely to remain a severely depressed year for the industry, with continued travel restrictions, health screening and social distancing, consumer concerns over travel, a weak economic environment and threats of further coronavirus outbreaks. This is likely to be partially mitigated by better preparedness by governments and healthcare systems, international coordination, pent-up consumer demand and the economic importance of resuming air travel. The timing and profile of a recovery beyond 2021 also remains highly uncertain.

In response to the crisis IAG has secured substantial levels of liquidity and reduced costs and cash outflows. It has furloughed staff under government job retention schemes and has also launched a restructuring and redundancy programme within its subsidiary British Airways, Plc (Ba1 negative), affecting up to 12,000 staff, subject to ongoing consultation with labour representatives.

As at 30 April 2020 the company had total liquidity of GBP10 billion, comprising cash of GBP6.4 billion and GBP3.6 billion of undrawn committed facilities. The company also has substantial levels of unencumbered aircraft fleet which could be used to further enhance liquidity and further facilities are currently under negotiation. It also has the potential to monetise its air miles loyalty scheme which could create substantial further liquidity.

IAG has hedged around 90% of its expected fuel burn for 2020 and has reported a mark-to-market loss of around €1.5 billion which is expected to be incurred in cash during the year. The company's weekly operating cash costs are currently around €200 million, with cash burn expected to reduce over the course of the year as hedging costs reduce and from further cost management. Accordingly the company is likely to have sufficient liquidity to support groundings lasting for around one year before additional fund raising, although this remains subject to some uncertainty particularly in relation to the level of potential customer refunds for cancelled flights.

Moody's expects that IAG will incur substantial additional debt to support its liquidity and cash consumption during the coronavirus outbreak, and that cash generation is unlikely to be sufficient thereafter to restore balance sheet metrics by 2023.

Moody's considers that IAG is more weakly positioned than British Airways, as British Airways had the highest operating margin across the airlines within the IAG group, including Iberia, Aer Lingus, Vueling and LEVEL, despite increased diversity and scale of the wider group. IAG will also need to complete and finance the €1 billion debt-funded acquisition of Air Europa during 2020 if the transaction is approved by regulators, which will weaken its financial metrics, although there is a price adjustment mechanism in the agreement.

At the same time the rating reflects Moody's expectation that IAG will remain a leading operator in the industry and that it is likely to gain market share and improve operational efficiencies after the crisis. This is supported by its large scale, strong brands, extensive and diversified global network, and strong market positions on certain routes, including highly profitable transatlantic routes, and at sought after airports.

The company's €1 billion senior unsecured notes are rated Ba2, one notch below the corporate family rating. This reflects the substantial levels of senior secured and unsecured debt in the company's operating companies, which rank ahead of the debt at IAG holding company level.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS

Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety.

IAG complied with all the applicable recommendations of the Spanish Corporate Governance Code and 2018 UK Corporate Governance Code, with minor exceptions as detailed in its 2019 annual report.

The company is targeting a 10 per cent improvement in fuel efficiency between 2020 and 2025, a 20 per cent reduction in net CO2 emissions by 2030, and net zero CO2 emissions by 2050.

OUTLOOK

The negative outlook reflects the continued uncertain prospects for the airline industry, with risks of extended disruption to travel causing further strain on the company's balance sheet and liquidity.

FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS

The ratings are unlikely to be upgraded in the short term. Positive rating pressure would not arise until the coronavirus outbreak is brought under control, travel restrictions are lifted, and passenger volumes return to more normal levels. At this point Moody's would evaluate the balance sheet and liquidity strength of the company and positive rating pressure would require evidence that the company is capable of substantially recovering its financial metrics and restoring liquidity headroom within a 1-2 year time horizon.

Moody's could downgrade IAG if:

• There are expectations of deeper and longer declines in passenger volumes extending materially into 2021

• There are concerns over the adequacy of liquidity driven by extended groundings in 2021

• There are clear expectations that the company will not be able to maintain financial metrics compatible with a Ba1 rating following the coronavirus outbreak, in particular if:

- Gross adjusted leverage is expected to be sustainably above 4x

- Reported operating profit margin were to fall substantially below 10%

- Retained cash flow to debt reduces towards 15%

[buywell3] 31/5/2020 01:09

Airlines are now saying that they expect a "brutal low-fare environment" when air travel resumes.

This is why WB sold out

He knew the whole industry would suffer for years.

buywell wonders who is insuring all those planes that will never fly again ?

[silkstag] 30/5/2020 17:14

Tourists from EU countries including Germany, Austria, Denmark and Finland will be able to visit from 15 June, the Greece tourism ministry said in a statement on Friday.

But some of the world's worst-affected countries - including the UK, France, Italy and Spain - are not on the list.
.
Grim news for BA and Iberia, which will be a recurring theme imho

[m1k3y1] 30/5/2020 15:14

Ducky......I suspect it is for Level.

Rumour is that BA will be pulling out of LGW BUT IAG will be moving Level in to replace BA.

Not good for British Airways Employees of course but IAG doesn't appear to care about that.

Have to wonder why Walsh is 'raping' BA to benefit it's Spanish carriers.
I see that 'Open Skies' which was owned by BA was transferred to Level for the grand sum of £1.

At this rate, anything left of BA could well end up in Spanish hands. Still I guess this would get around the EU ownership requirements !

[ducky fuzz] 30/5/2020 14:56

m1k3y1 .. Is the above good news for IAG ? DF

[hamhamham1] 30/5/2020 05:42

Mos6 all companies shares went up very large amounts last weeks it was inevitable that there would be a fair amount of pull back. I look at the weekly charts to get a feel for direction and if any angle is flattening out. Let's see what happens, the biggest risk is Trump and what he extremes he does to play to his supporters.

[loganair] 29/5/2020 16:18

South Korea is shutting down parks and art galleries and the like for the next fortnight because there has been a spike in Covid 19 cases.

[m1k3y1] 29/5/2020 15:06

The Guardian
British Airways may outsource work of 450 redundant employees

[montyhedge] 29/5/2020 15:00

It was only bear closing.