hisah wrote:Hedged fuel contracts turned positive
Hedged exchange losses increase 38%
How can the hedged fuel contracts be positive?
Anyone with the breakdown of this other costs? That's a huge spike!
Meanwhile the level to watch is 3.70. Price is slipping towards the 4.00 handle. Somehow the sellers are not spooked by this results based on the traded volume. Has the counter run out of sellers?
Very puzzling on the hedged fuel contracts. They still booked a loss on the derivatives albeit a decreasing one. Unless they took out new contracts(for example a collar)on additional fuel needs to cancel the losses on the old fixed hedges it doesn't make sense since outright canceling the old contracts and seeking new ones comes with heavy penalties which would have shown up here.
Looking at the consolidated income statement line by line reveals a very sad affair at KQ. There is still a lot of work to be done if this stock is to get back to investment grade. Save for the approximately 9b saving in direct costs(Mckinsey's trick)the rest of the deductible line items are either flat/flattish or increasing. Finance costs also spiked by some considerable margin(this one if not well managed will sink this company beyond redemption). They have probably exhausted their tax credits at this point too. On the other costs item, the only thing that comes to mind is the consultancy costs that is; Mckinsey,Seabury,PJT and crew...
In my opinion, this company will not be making a PAT for the next two financial years at the very minimum. More taxpayers money will be sunk into it year on year without a clear strategy of a turn-around.
The main purpose of the stock market is to make fools of as many people as possible.