TAP - more expenses but less payments
All,
Please find our thus far unchanged analysis here.
Naturally, this morning's preliminary Q4 figures do not provide us with further information on the restructuring - currently in the hands of the European Commission anyway. However, per Dec 31st the company retains E100m more cash than we had modelled. Revenue had been close, but from there we have seen some notable differences:
- E225m: The company recognised a higher amount of operating costs from Traffic and Employees
+ E525m: increase in payables, i.e. much of the above was recognised, but not actually paid - and then some
- E150m: Pay-out on excess fuel hedges
- E80m: unusually high investments (to be better understood)
In the short term that should mean that TAP are probably losing more money in H121 than we had anticipated, but in the scheme of things that does not make much difference.
We remain long the SUNs and are expecting to remain untouched by the forthcoming recapitalisation.
Wolfgang
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E: wfelix@sarria.co.uk
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