ExpressJet
12-15-2016 | 05:32 PM
#61
Gets Weekends Off
Joined: Oct 2015
Posts: 472
Likes: 0
You've got the wrong company's financial reports then. Here is the 1qtr 10Q from 2007, the last quarter before branded began operations. Net income of around $10M.
https://www.sec.gov/Archives/edgar/d...t10q033107.htm
And I never said branded made money. Only that once branded was shut down, the CAL CPA was unprofitable because of Skywest and so despite getting rid of branded, xjt was still losing money. Here is the first 10Q from after branded ceased operations. It shows a loss of about $11M.
https://www.sec.gov/Archives/edgar/d...33109final.htm
That's a difference of $21M per quarter just from the CPA that Skywest negotiated.
https://www.sec.gov/Archives/edgar/d...t10q033107.htm
And I never said branded made money. Only that once branded was shut down, the CAL CPA was unprofitable because of Skywest and so despite getting rid of branded, xjt was still losing money. Here is the first 10Q from after branded ceased operations. It shows a loss of about $11M.
https://www.sec.gov/Archives/edgar/d...33109final.htm
That's a difference of $21M per quarter just from the CPA that Skywest negotiated.
more from the 2008 10K...
2008 Amended Continental CPA. Prior to July 1, 2008, Airlines was entitled to receive payment for each block hour that Continental scheduled it to fly pursuant to the terms of the Continental CPA. Payment was based on a formula designed to provide Airlines with a target operating margin of 10% before taking into account variations in certain costs and expenses that were generally within our control. We had exposure for most labor costs and some maintenance and general administrative expenses if actual costs were higher than those budgeted in our block hour rates. For the first six months of 2008, we recognized revenues using 2007 block hour rates, pursuant to our agreement with Continental reached in June 2008.
At such time, we also reached an agreement with Continental to amend the existing Continental CPA. The Amended Continental CPA, which became effective July 1, 2008, allows us to continue flying, at minimum, 205 aircraft for Continental for seven years while providing Continental the right after one year to reduce the number of aircraft to a minimum of 190 aircraft. (It should be noted going forward in our document, we will use the designation, “the Continental CPA,” for matters that remained same between the original CPA and the Amended Continental CPA; where matters differed between the original CPA and the Amended Continental CPA, they will be specifically identified to “the Amended Continental CPA.”)The Amended Continental CPA significantly reduces Continental’s governance rights under the original CPA, including easing change-of-control limitations on ExpressJet, reducing restrictions on our flying into Continental’s hub airports, and removing the most-favored-nation clause, allowing us the option to fly for other carriers and to consider other strategic alternatives. The Amended Continental CPA also removes Continental’s ability to terminate the agreement without cause.
The Amended Continental CPA provides payments to us at a pre-determined rate based on block hours flown and reimburses us for various pass-through expenses including passenger liability insurance, hull insurance, war risk insurance, landing fees and substantially all regional jet engine expenses under current long-term third-party contracts with no margin or mark-up. Under the Amended Continental CPA, Continental is responsible for the cost of providing fuel for all flights and for paying aircraft rent for all aircraft covered by the Amended Continental CPA and, therefore, these items are not included in our statements of operations for the three month period ended September 30, 2008 and thereafter. The fixed block hour rates are considerably lower than the rates under the original agreement and will be subject to annual escalations tied to a consumer price index (capped at 3.5%) at each anniversary date, July 1. During 2008, we returned as part of the Amended Continental CPA negotiations, 30 aircraft, with Continental bearing the expense related to the aircraft following their return. We will continue to operate at least 205 aircraft through July 1, 2009. Beginning on July 1, 2009, Continental can remove up to 15 aircraft making the new minimum aircraft requirement under the agreement 190. Therefore, we will continue to focus on aggressively managing costs in response to the Amended Continental CPA and the economic difficulties facing the entire airline industry.
We also entered into a settlement agreement with Continental to release the parties’ claims at the time of the agreement to amend the then existing capacity purchase agreement, relating to certain identified payments under such capacity purchase agreement, including disputes previously disclosed as possible matters for arbitration.
In September 2008, we agreed with Continental on the first amendment to the Amended Continental CPA in order to compensate us for our fixed costs, considered in the calculation of the pre-determined block hour rates, that cannot be reduced as a result of the unanticipated reduction in aircraft utilization by Continental’s scheduling. We also agreed that if Continental, beginning in year two, increases its aircraft utilization above a predetermined threshold, then it may receive discounts on the agreed, pre-determined block hour rates. For the last six months of 2008, we recognized an additional $3.4 million in contract revenues as compensation for shortfalls in aircraft utilization.
In December 2008, we agreed with Continental on the first second amendment to the Amended Continental CPA in order to clarify certain issues related to our revenue recognition, the fuel efficiency program in place in connection with the Amended Continental CPA and depreciation related to the aircraft we operate for Continental and excess inventory related thereto.
Prior Years’ Settlement of the Continental CPA. Airlines was entitled to receive payment for each block hour that Continental scheduled it to fly. Payment was based on a formula designed to provide Airlines with a target operating margin before taking into account variations in certain costs and expenses that were generally within our control. We had exposure for most labor costs and some maintenance and general administrative expenses if actual costs were higher than those budgeted in our block hour rates. Prior years’ payment methodologies are described in the following paragraphs.
2005-2007. As part of the 2005 rate negotiations, we agreed to cap Airlines’ prevailing margin at 10.0% in an attempt to ensure the long-term stability of the Continental CPA. Airlines also began including previously unreconciled costs, as discussed above, within the margin band, although it was not reimbursed if these costs are higher and cause its prevailing margin to fall below the 8.5% margin floor. Airlines remained entitled to receive incentive payments from Continental if its rate of controllable cancellations was lower than its historical benchmark, but was no longer required to pay Continental a penalty for controllable cancellations unless the rate rises above 0.5%. Airlines continued to receive a small per-passenger fee and incentive payments for certain on-time departure and baggage handling performance.
I wasn't at the negotiation table back then but this reads like a nice cost plus set-up while XJT was a Continental subsidiary that got turned into an independent CPA model. It isn't difficult to show a profit with a cost plus approach.
And I doubt SKYW agreed to lower rates out of the goodness of their hearts. It seems to me that Continental was pushing lower rates pretty aggressively. I guess the better option would have been to walk away from te deal back then...
12-15-2016 | 06:53 PM
#62
Gets Weekends Off
Joined: Oct 2016
Posts: 846
Likes: 0
ExpressJet
more from the 2008 10K...
2008 Amended Continental CPA. Prior to July 1, 2008, Airlines was entitled to receive payment for each block hour that Continental scheduled it to fly pursuant to the terms of the Continental CPA. Payment was based on a formula designed to provide Airlines with a target operating margin of 10% before taking into account variations in certain costs and expenses that were generally within our control. We had exposure for most labor costs and some maintenance and general administrative expenses if actual costs were higher than those budgeted in our block hour rates. For the first six months of 2008, we recognized revenues using 2007 block hour rates, pursuant to our agreement with Continental reached in June 2008.
At such time, we also reached an agreement with Continental to amend the existing Continental CPA. The Amended Continental CPA, which became effective July 1, 2008, allows us to continue flying, at minimum, 205 aircraft for Continental for seven years while providing Continental the right after one year to reduce the number of aircraft to a minimum of 190 aircraft. (It should be noted going forward in our document, we will use the designation, “the Continental CPA,” for matters that remained same between the original CPA and the Amended Continental CPA; where matters differed between the original CPA and the Amended Continental CPA, they will be specifically identified to “the Amended Continental CPA.”)The Amended Continental CPA significantly reduces Continental’s governance rights under the original CPA, including easing change-of-control limitations on ExpressJet, reducing restrictions on our flying into Continental’s hub airports, and removing the most-favored-nation clause, allowing us the option to fly for other carriers and to consider other strategic alternatives. The Amended Continental CPA also removes Continental’s ability to terminate the agreement without cause.
The Amended Continental CPA provides payments to us at a pre-determined rate based on block hours flown and reimburses us for various pass-through expenses including passenger liability insurance, hull insurance, war risk insurance, landing fees and substantially all regional jet engine expenses under current long-term third-party contracts with no margin or mark-up. Under the Amended Continental CPA, Continental is responsible for the cost of providing fuel for all flights and for paying aircraft rent for all aircraft covered by the Amended Continental CPA and, therefore, these items are not included in our statements of operations for the three month period ended September 30, 2008 and thereafter. The fixed block hour rates are considerably lower than the rates under the original agreement and will be subject to annual escalations tied to a consumer price index (capped at 3.5%) at each anniversary date, July 1. During 2008, we returned as part of the Amended Continental CPA negotiations, 30 aircraft, with Continental bearing the expense related to the aircraft following their return. We will continue to operate at least 205 aircraft through July 1, 2009. Beginning on July 1, 2009, Continental can remove up to 15 aircraft making the new minimum aircraft requirement under the agreement 190. Therefore, we will continue to focus on aggressively managing costs in response to the Amended Continental CPA and the economic difficulties facing the entire airline industry.
We also entered into a settlement agreement with Continental to release the parties’ claims at the time of the agreement to amend the then existing capacity purchase agreement, relating to certain identified payments under such capacity purchase agreement, including disputes previously disclosed as possible matters for arbitration.
In September 2008, we agreed with Continental on the first amendment to the Amended Continental CPA in order to compensate us for our fixed costs, considered in the calculation of the pre-determined block hour rates, that cannot be reduced as a result of the unanticipated reduction in aircraft utilization by Continental’s scheduling. We also agreed that if Continental, beginning in year two, increases its aircraft utilization above a predetermined threshold, then it may receive discounts on the agreed, pre-determined block hour rates. For the last six months of 2008, we recognized an additional $3.4 million in contract revenues as compensation for shortfalls in aircraft utilization.
In December 2008, we agreed with Continental on the first second amendment to the Amended Continental CPA in order to clarify certain issues related to our revenue recognition, the fuel efficiency program in place in connection with the Amended Continental CPA and depreciation related to the aircraft we operate for Continental and excess inventory related thereto.
Prior Years’ Settlement of the Continental CPA. Airlines was entitled to receive payment for each block hour that Continental scheduled it to fly. Payment was based on a formula designed to provide Airlines with a target operating margin before taking into account variations in certain costs and expenses that were generally within our control. We had exposure for most labor costs and some maintenance and general administrative expenses if actual costs were higher than those budgeted in our block hour rates. Prior years’ payment methodologies are described in the following paragraphs.
2005-2007. As part of the 2005 rate negotiations, we agreed to cap Airlines’ prevailing margin at 10.0% in an attempt to ensure the long-term stability of the Continental CPA. Airlines also began including previously unreconciled costs, as discussed above, within the margin band, although it was not reimbursed if these costs are higher and cause its prevailing margin to fall below the 8.5% margin floor. Airlines remained entitled to receive incentive payments from Continental if its rate of controllable cancellations was lower than its historical benchmark, but was no longer required to pay Continental a penalty for controllable cancellations unless the rate rises above 0.5%. Airlines continued to receive a small per-passenger fee and incentive payments for certain on-time departure and baggage handling performance.
I wasn't at the negotiation table back then but this reads like a nice cost plus set-up while XJT was a Continental subsidiary that got turned into an independent CPA model. It isn't difficult to show a profit with a cost plus approach.
And I doubt SKYW agreed to lower rates out of the goodness of their hearts. It seems to me that Continental was pushing lower rates pretty aggressively. I guess the better option would have been to walk away from te deal back then...
2008 Amended Continental CPA. Prior to July 1, 2008, Airlines was entitled to receive payment for each block hour that Continental scheduled it to fly pursuant to the terms of the Continental CPA. Payment was based on a formula designed to provide Airlines with a target operating margin of 10% before taking into account variations in certain costs and expenses that were generally within our control. We had exposure for most labor costs and some maintenance and general administrative expenses if actual costs were higher than those budgeted in our block hour rates. For the first six months of 2008, we recognized revenues using 2007 block hour rates, pursuant to our agreement with Continental reached in June 2008.
At such time, we also reached an agreement with Continental to amend the existing Continental CPA. The Amended Continental CPA, which became effective July 1, 2008, allows us to continue flying, at minimum, 205 aircraft for Continental for seven years while providing Continental the right after one year to reduce the number of aircraft to a minimum of 190 aircraft. (It should be noted going forward in our document, we will use the designation, “the Continental CPA,” for matters that remained same between the original CPA and the Amended Continental CPA; where matters differed between the original CPA and the Amended Continental CPA, they will be specifically identified to “the Amended Continental CPA.”)The Amended Continental CPA significantly reduces Continental’s governance rights under the original CPA, including easing change-of-control limitations on ExpressJet, reducing restrictions on our flying into Continental’s hub airports, and removing the most-favored-nation clause, allowing us the option to fly for other carriers and to consider other strategic alternatives. The Amended Continental CPA also removes Continental’s ability to terminate the agreement without cause.
The Amended Continental CPA provides payments to us at a pre-determined rate based on block hours flown and reimburses us for various pass-through expenses including passenger liability insurance, hull insurance, war risk insurance, landing fees and substantially all regional jet engine expenses under current long-term third-party contracts with no margin or mark-up. Under the Amended Continental CPA, Continental is responsible for the cost of providing fuel for all flights and for paying aircraft rent for all aircraft covered by the Amended Continental CPA and, therefore, these items are not included in our statements of operations for the three month period ended September 30, 2008 and thereafter. The fixed block hour rates are considerably lower than the rates under the original agreement and will be subject to annual escalations tied to a consumer price index (capped at 3.5%) at each anniversary date, July 1. During 2008, we returned as part of the Amended Continental CPA negotiations, 30 aircraft, with Continental bearing the expense related to the aircraft following their return. We will continue to operate at least 205 aircraft through July 1, 2009. Beginning on July 1, 2009, Continental can remove up to 15 aircraft making the new minimum aircraft requirement under the agreement 190. Therefore, we will continue to focus on aggressively managing costs in response to the Amended Continental CPA and the economic difficulties facing the entire airline industry.
We also entered into a settlement agreement with Continental to release the parties’ claims at the time of the agreement to amend the then existing capacity purchase agreement, relating to certain identified payments under such capacity purchase agreement, including disputes previously disclosed as possible matters for arbitration.
In September 2008, we agreed with Continental on the first amendment to the Amended Continental CPA in order to compensate us for our fixed costs, considered in the calculation of the pre-determined block hour rates, that cannot be reduced as a result of the unanticipated reduction in aircraft utilization by Continental’s scheduling. We also agreed that if Continental, beginning in year two, increases its aircraft utilization above a predetermined threshold, then it may receive discounts on the agreed, pre-determined block hour rates. For the last six months of 2008, we recognized an additional $3.4 million in contract revenues as compensation for shortfalls in aircraft utilization.
In December 2008, we agreed with Continental on the first second amendment to the Amended Continental CPA in order to clarify certain issues related to our revenue recognition, the fuel efficiency program in place in connection with the Amended Continental CPA and depreciation related to the aircraft we operate for Continental and excess inventory related thereto.
Prior Years’ Settlement of the Continental CPA. Airlines was entitled to receive payment for each block hour that Continental scheduled it to fly. Payment was based on a formula designed to provide Airlines with a target operating margin before taking into account variations in certain costs and expenses that were generally within our control. We had exposure for most labor costs and some maintenance and general administrative expenses if actual costs were higher than those budgeted in our block hour rates. Prior years’ payment methodologies are described in the following paragraphs.
2005-2007. As part of the 2005 rate negotiations, we agreed to cap Airlines’ prevailing margin at 10.0% in an attempt to ensure the long-term stability of the Continental CPA. Airlines also began including previously unreconciled costs, as discussed above, within the margin band, although it was not reimbursed if these costs are higher and cause its prevailing margin to fall below the 8.5% margin floor. Airlines remained entitled to receive incentive payments from Continental if its rate of controllable cancellations was lower than its historical benchmark, but was no longer required to pay Continental a penalty for controllable cancellations unless the rate rises above 0.5%. Airlines continued to receive a small per-passenger fee and incentive payments for certain on-time departure and baggage handling performance.
I wasn't at the negotiation table back then but this reads like a nice cost plus set-up while XJT was a Continental subsidiary that got turned into an independent CPA model. It isn't difficult to show a profit with a cost plus approach.
And I doubt SKYW agreed to lower rates out of the goodness of their hearts. It seems to me that Continental was pushing lower rates pretty aggressively. I guess the better option would have been to walk away from te deal back then...
I see your 10K and I'll raise you the low ball offer letter. And accompanying threat to match Skywest or else.
https://www.sec.gov/Archives/edgar/d...042408e993.htm
The fact of the matter is that xjt had a profitable CPA until Skywest was paid $8M to look at their books and low ball 'em. They assumed a 16% concessions from the pilots to bring them into parity with Skywest pilots, among other things. Without that, there was no credible threat of losing the cost plus agreement until the CPA came up for renewal at the end of 2010. Keep in mind that the cost plus CPA was written by CAL, including the 5 year wait to renegotiate and arbitrate, the 25% reduction, the complete termination with one year notice, the favored nation clause, the hub restriction, the restriction on using aircraft options, the poison pill, the $400M loan, all in order to pump up the IPO of CalEx. My main point was that the CAL CPA was profitable the whole time until Skywest. Anyway, it's silly to argue it now.
Last edited by Nevjets; 12-15-2016 at 07:17 PM.
12-17-2016 | 01:01 PM
#64
Gets Weekends Off
Joined: Jan 2014
Posts: 355
Likes: 0
From: Yellow Bus
I'm not sure exactly without looking at the contract. However, on the premium art award, there's one pilot that was displaced from DFW to DTW. There are no vacancies shown for DTW on the position notice. This makes it appear that it would be up to company needs. So if you're not senior enough to hold DFW CR7, you'd be moved to the next location that they needed you that is on your bid list.
Sent from my iPhone using Tapatalk
Sent from my iPhone using Tapatalk
DFW 700 will go more senior. It used to be junior upgrade. Those junior CAs will go back to FO. now ASA is parking all the 200s by 2017. The airline will shrink to 900 total pilots. Possible furlough unless attrition can't beat the date of parking 46 planes. No more upgrades. Basically they are being Comaired. Bad, bad days at ASA
12-18-2016 | 08:49 AM
#65
Gets Weekends Off
Joined: May 2012
Posts: 345
Likes: 0
Look for our performance numbers to go down as well as multiple maintenance write ups. For those of even thinking of coming here don't bother. Furloughs will be announced sometime between June and August.
For those who think we will be fine you are only fooling yourself. We have been comaired.
For those who think we will be fine you are only fooling yourself. We have been comaired.
12-18-2016 | 10:22 AM
#67
Gets Weekends Off
Joined: Sep 2010
Posts: 2,648
Likes: 0
DFW 700 will go more senior. It used to be junior upgrade. Those junior CAs will go back to FO. now ASA is parking all the 200s by 2017. The airline will shrink to 900 total pilots. Possible furlough unless attrition can't beat the date of parking 46 planes. No more upgrades. Basically they are being Comaired. Bad, bad days at ASA
12-18-2016 | 10:31 AM
#68
Gets Weekends Off
Joined: Sep 2014
Posts: 828
Likes: 0
For those worrying about furloughs (which I understand) take a look at how many planes we have parked on the ERJ side and have not had to furlough one pilot. With attrition I would assume no furloughs on the ASA side.
12-18-2016 | 10:37 AM
#69
Gets Weekends Off
Joined: Oct 2016
Posts: 336
Likes: 0
12-18-2016 | 10:38 AM
#70
Gets Weekends Off
Joined: May 2014
Posts: 273
Likes: 0
We need good 145 guys at Piedmont if anyone is interested. Opportunities for check airman and junior upgrade is 4 months on property. PM if you need a rec. SIM partner was XJet heard all about the **** going on but he is glad he made the switch.
Thread
Thread Starter
Forum
Replies
Last Post
