Cargo B financial woes ?

[Acid-drop]

My personal guess: with the move to LGG, Cargo B management declared war to one of the shareholders, Flanders Invest, who is only allowed to invest in employment in the Flemish Region. So Kuijpers & co forced them to withdrawn from Cargo B. Which investor will have confidence in these people?

Might be a bit more complicated ...
Cargo B was already loosing a lot of money in the past, KBC is in deep sh*t, the flemish gov is broke, nothing was running like it should have. The move to LGG was the desperate last move of a dying company to survive. But it came too late.

[OO-JFP]

the flemish gov is broke

How would you describe the walloon gov then ?

OO-JFP

[Acid-drop]

out of topic. We're talking about the shareholders of cargo B

[RoMax]

But 12 million is really too much for Cargo B, their capital was only 27 million. And this all while they where loss making. This move to LGG was just suicide.

[Acid-drop]

I don't think it's linked and it's good, because otherwize we would have some narrow minded people saying all the shit happens because of the walloons... lovely belgium

[RoMax]

I am prity sure it is linked, wich company with a good management would move the whole company to another airport (ok it is cheaper than BRU) in a time of crisis when the whole move costs 12 million?! And this while Flanders invest can do nothing when they go outside the Flanders, by by investement of the Flanders. This move, together with the crisis and al the other problems, was just the end of Cargo B. This is something that is very clear now.

[Super Baloo]

I can hardly see how a move from BRU to LGG can cost 12 million euros to a company.

Did they have a long term contract with Brussels Airport or with Aviapartner Brussels that they were forced to pay penalties ?
All the offices could have stayed in Brucargo (dispatch, finance, administration, sales, etc.). You just have to move some mechanics and some ops guys to make sure that Aviapartner Liège makes its job correctly (so hardly 10 to 15 mens in total).
For the pilots, you just have to tell them that the crew report point is now Liège Airport instead of Brussels Airport so it is totally free for you (no crew transport). And if they are not happy with it, so be it.
Even if you have to pay for regular trucking between LGG and BRU, I can hardly see how you can come close to the 12 million euros figure.

All other costs (landing fees, fuel, build up charges, turn around charges, etc.) are cheaper in LGG (in general but depends on the contract you sign with your handling agent obviously) and you had to pay them in BRU anyway.

So in case I'm missing a huge thing here, I really don't understand how you can come close to 12M for such a move.

If someone could explain it to me (or to us, I'm not sellfish), I would really appreciate it.

Thank you.

[teddybAIR]

Beats me...

I mean 12m€...that is like 480m old belgian 'frankskes' four hundred eighty million!!! I don't know about the rest of you guys, but to me this stinks! I realise that it is not that straightforward as simply ferrying your B744's from EBBR to EBLG but 12m€?! They must have done a pispoor job negotiating the terms and conditions with their current handling agent, real estate owner or EBBR!

They probably included the cost of project management as well, but at the standard cost of a project manager (about 900€ per day) they would have had their entire headcount (+/- 60) working on the move for an entire year without leaving a single day on holidays.

Hard to understand. Anyway, anybody got some more news. I'm reading contradictory messages, some saying Cargo B will fly this weekend, while others state it is deffinetely over.

All the best!

[LX-LGX]

out of topic. We're talking about the shareholders of cargo B

So are we: the Flemish government is shareholder at Cargo B - through Participatiemaatschappij Vlaanderen.

http://www.ejustice.just.fgov.be/tsv_pd ... 090340.pdf

[Acid-drop]

I was answering the previous answer
nevermind

[Atlantis]

Its hard to believe that their move to LGG would cost 12 million euro unless they had to pay penalties.
They had no own facilities. They had an office at building 706. Was there a possibility that the office people could stay at that office? I don't know. There would be no change of a handler: Aviapartner was their partner at BRU and would be their new partner at LGG.

My only conclusion is that they had to pay penalties to Brussels Airport and maybe some other parties. Maybe that's the reason why BRU didn't* react to their move to LGG because they knew the bad situation of Cargo B.

*: they didn't react in the press (which is very good).

[joyraider]

Just a crazy thought, but wouldn't the "12 million" be some kind of typo in the article?

[OO-JFP]

by Acid-drop »

out of topic. We're talking about the shareholders of cargo B

Acid-drol, I'm not done yet.
1) You didn't answer my question.
2) You're the king of making big statements but you never give a proof of what you say.

KBC is in deep sh*t, the flemish gov is broke, nothing was running like it should have.

3) And why on earth would the walloon gov suddenly give them a loan of 1.5 M€?
(I heard on the radio that the walloon gov don't expect a balance in their accounts till at least 2015, hence my question) Was the purpose to convert it into capital afterwards and then build it up to replace the VPM as shareholder ?

If I read through the various posts on this toppic, many of them are money-related and that's exactly where there is a lack of correct information. As one of the members already said: there is no comment from the side of Brussels Airport, nor from the shareholders. There's just the mention in a newspaper of a moving cost and a loan (if the amounts are correct).

I guess we'll never know all the reasons behind this story.
OO-JFP

[Acid-drop]

I didn't want to insist on this, but ... Here you go
http://www.rtlinfo.be/rtl/news/article/ ... en+flandre
the title is enough.
Meaning : the shareholder is in some difficulties too, and maybe has other thing to think than Cargo B.
No need to compare to Wallonia or Guatemala, they're not shareholders.

About they money, the loan of 1.5 millions may be for the move, and the 12 millions looks more to me like a new investment plan in LGG ... building new office buildings, new warehouse, all that ... but since they didnt have the chance to move, this money was not used, so this has nothing to do with the bankrupsy

[Established02]

Aandeelhouders Cargo B Airlines beslissen maandag
http://www.tijd.be/nieuws/ondernemingen ... 75-431.art
Op dit ogenblik worden geen gesprekken meer gevoerd met mogelijke investeerders, maar de meeste werknemers zijn nog in dienst en ook de huurcontracten voor twee Boeings B747-400 zijn nog niet verbroken, zegt Niek Van der Weide, commercieel directeur van Cargo B Airlines.

[Shanti]

Is er geen mogelijkheid om misschien winst te maken met combi (passagiers/cargo)
vluchten? KLM voert ook combi 747 vluchten uit. Cargo B kan bv. vanuit Brussel naar Shanghai,
Johannesburg, Kaapstad, Quito enz. uitvoeren dan gok je toch op twee paarden.
Half cargo, half passagiers. Het moet uiteraard haalbaar zijn. Véél succes voor
de mensen die werken bij Cargo B en hopelijk blijven jullie bestaan !

[teddybAIR]

Shanti,

with all due respect, but such decisions should be made on rock solid business cases proving an acceptable return on investments, not on a wild idea of someone stating: "wouldn't it be better to reduce risk by flying combi's" The answer is obviously "yes, you would reduce your risk"...but the logic next reflection should be "let's quantify this and make an informed decision"

Now, someone on tijd.be is suggesting that OO-CBA is owned by one of the shareholders of Cargo B and that this shareholder keeps charging Cargo B until the very end the full leasing price. If this is true, than you already have a sign that one of Cargo B's shareholders new what was going to come and wanted to recover maximal funds through OO-CBA.

Just some food for thought and everything is based on the (weak, i know) assumption that this person on tijd.be knows what he/she is talking about!

Best regards,
Tom

[NCB]

OO-CBA... isn't that the one that's U/S?
I think that any expenses on OO-CBA would need to be paid by the insurance.

It's not possible to get any combi's on the market and it's not possible to make a combi from a Boeing factory produced, non-converted B744ERF. Perhaps the 747 was too big for Cargo B, they should have started with something small like a B763F with ER engines and seen the crisis coming. When Cargo B started, the freight market was literally exploding, which probably put them in too optimistic a mindset.

[teddybAIR]

Yes,OO-CBA is the U/S aircraft.

You need to split two issues. First of all, you are correct that any damage to the airplane should be refunded by the insurance company under the assumption that the damage to OO-CBA falls under the insurance contract.

Secondly, the fact that the aircraft is U/S does not stop the leasing contract. This source on tijd.be says that cargo B is still paying the full leasing price to the owner of the aircraft despite the fact that it is unservicable. If this is true, it would mean that this week Cargo B - even if they had continued operations - would have had their entire fleet (also CBC and CBD are grounded in AMS) grounded for about a full week. List price of a 744 is about 250m$...I guess I don't have to explain what happens to your +/-30m$ capital if you leave an investment of about 700m$ non-productive for an entire week!

I can't help thinking that Cargo B was suffering from a little "grootheidswaanzin". I don't know the turnover of Cargo B, but burning 27m€ capital is massive. What was their annual turnover? I mean, with an effectively opperational fleet of 2 aircraft it cannot have been that high, right? To lose 27m€ on less than 2 years is truly an art and proof of non-management and lack of fact-based decision making!

[Filou]

All,
Some small remarks on points stated above:
* official charges at LGG are not cheaper than @ BRU. Please see websites and you'll find out; But LGG offers hugh incentives - paid by their shareholder being the walloon gvt - to tackle this issue and to be attractive.
* Aviapartner BRU or LGG is absolutely not the same company. AP LGG is the former Liege handling, a company beloning to the airport again where they "lease" AP's name but do it all themselves ( they had to change names after some courtacses against them...); Also here, they offer hugh incentives to airlines on handling, all paid by the airport - and the Walloon gvmt again.
So Cargo B's contract is probably not the same; not to forget the superb investment AP BRU did for Cargo B on the vacum fridge - a financial disaster for AP now that BB is not using it any more. Poor AP too in this case !
* Except the incentives from the airport on both charges, LGG offers other incentives on top to make it more attractive ( such as truicking, etc)...
Just FYI, I would advise to search the internet for LGG's turnover and LGG's subsidies by the wallon Gvtmt, and you might understand what a kind of "bubble" LGG is...and even here, I doubt that LGG would have meant the survival of BB...