Originally Posted by
FlyFlorida2025
I'm taking it one month at a time, and October was positive in that they didn’t burn cash. They ended up +$20 million and may not have needed to draw from the DIP. Their transformation plan projects losses for the foreseeable future, but preventing cash burn during restructuring is critical. Avoiding a DIP draw (assuming they did) is a good sign. Ultimately, I believe the goal of all this is to uplift enterprise value and sell at a premium. Next up is $3 billion in debt reduction and labor concessions.
Spirit LOST $96M in October. The GAAP profit of $20M was only because of terminated leases that were accounted for as a non-cash gain. Its accounting for tax purposes, but Spirit didn't "make $20M" nothing like that. According to the financial statement Spirit added $250M in cash. This has to be DIP financing. The earnings statement doesn't show any sales of assets attributable to this much cash being added to the balance sheet.
Spirit drew $250M in cash, but their actual cash burn from the operational losses were $77M, which is slightly better than the $90M.
Spirit has a -38% operating margin. This is not sustainable nor will go away by becoming smaller. Being smaller will only reduce the cash burn so they aren't losing 38% at scale.