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Kenya Airways...why ignore..
Rank: Chief Joined: 1/3/2007 Posts: 18,290 Location: Nairobi
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obiero wrote:VituVingiSana wrote:[quote=obiero]On November 12 at the KQ pride centre expect an announcement of KES 7.4B loss before tax.. The profit will soon come, but later than anticipated due to delayed sale of subject craft https://www.standardmedi...s-200-mln-bridging-loan[/quote] Every 6 months, you tell us the next 6 months will be better. Good luck. In the meantime, drop by the KK & KenRe threads. I honestly had guesstimated the turnaround by H1, but got new data over the weekend that led me to place a sale of 26,400 shares today.. im still inside the plane, but lighter on baggage Roho safi. I was like you. I used to believe that things would be better. I believed the hype. I believed the Management. I thought Naikuni was THE GUY. I lost a lot on KQ. Even on KK (Segman days). As I read more of Buffett's writings, I realized that MANAGEMENT is key. Ngunze may be a nice guy. He may be competent. The people (eg CFO) are either crooked, incompetent or both. Segman had hubris. Later I found out that despite the objections of his senior staff (& board) he took outsized BETS (gambling not operations) on forex & oil prices to goose up the EPS. Ohana is brusque but he reduced debt by reducing inventories (no speculation on the movement in prices), paid off (cheap but not when KES depreciates) FX debt, sold assets, cut costs, etc. He also lucked out that oil prices fell thus reducing the need for Working Capital. KQ - There's no significant reduction in debt. The 'hard assets' [land, planes] will be sold but as the 2 new 787s [waiting for delivery] come in the debt will rise again. The most important point is that I do NOT trust the management. Period. KK has a chance at being bought out at (revised) NAV or better. If not, it can remain profitable with price controls stifling competition. KQ has little chance of being bought out in its current state. There's too much drama with debtors, pilots, employees, etc. It will have to restructure & the debtors will own the airline while the Shareholders will be wiped out. In other words, sell ALL your KQ shares & look for a better firm to put your money in. Good Luck. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Chief Joined: 1/3/2007 Posts: 18,290 Location: Nairobi
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S.Mutaga III wrote:Lessons I have learned since 2011
- NEVER invest in a company with declining profits
- NEVER invest in a company making losses (KQ is squarely in this category)
- NEVER invest in a company where GoK has a controlling stake
- NEVER invest in a company with a P/E of more than 7. The lesser the better.
- NEVER invest in an illiquid stock
Those are just some of the basics I have gathered over the years. That approach has served me well and when I break any of those rules, I lose money  - NEVER invest in a company with a shady board/management unless you can buy control at a fair price, change the management & have the patience/fortitude. I am OK with illiquid stocks & paying more than a 7 PER as long as you follow the other principles. WB doesn't mind illiquid stocks coz he buys value not liquidity. Of course, at the right price, he can buy the entire firm and make it completely illiquid! Rea, Williamson, Kapchorua, Unga. On the PER, WB's partner Charlie Munger taught him that it's OK to pay a fair price for a great company. The PER may look great but PEG is more important. I missed out on Equity in the early days when its PER was consistently higher than its peers but its profits grew 100% p.a. for years! (At one time or the other these had high PERs but while the PAT growth was excellent for an extended period. I am not saying they are still good buys.) Equity, Carbacid, ARM, Safaricom I own a low PER stock with GoK control - KenRe - but generally I avoid GoK firms even with low PERs e.g. KenGen, KPLC (at the moment). Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 11/15/2013 Posts: 1,977 Location: Here
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obiero wrote:VituVingiSana wrote:[quote=obiero]On November 12 at the KQ pride centre expect an announcement of KES 7.4B loss before tax.. The profit will soon come, but later than anticipated due to delayed sale of subject craft https://www.standardmedi...s-200-mln-bridging-loan[/quote] Every 6 months, you tell us the next 6 months will be better. Good luck. In the meantime, drop by the KK & KenRe threads. I honestly had guesstimated the turnaround by H1, but got new data over the weekend that led me to place a sale of 26,400 shares today.. im still inside the plane, but lighter on baggage Good brother I see finally you accept reality. Being heavy on KQ was tricky in such economical times.You have really enriched the brokers. Everybody STEALS, a THIEF is one who's CAUGHT stealing something of LITTLE VALUE. !!!
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Rank: Member Joined: 5/6/2008 Posts: 199
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I'll just leave this here: http://www.mckinsey.com/...companies_out_of_crisis
Of interest is the signs of distress
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Rank: Chief Joined: 1/3/2007 Posts: 18,290 Location: Nairobi
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Via @bankelele a blogger http://bankelele.co.ke/2...-agm.html#comment-10539
@obiero - Where's your blog post on KQ's AGM? Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Member Joined: 9/11/2014 Posts: 228 Location: Nairobi
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Great article for business owners
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Rank: New-farer Joined: 5/20/2010 Posts: 69
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Rank: Elder Joined: 6/23/2009 Posts: 14,048 Location: nairobi
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''Loss making Kenya Airways'' what a way to headline a story. Like referring to ''Yule mtoto alianguka KCSE''.. MOVE ON!
KQ ABP 4.48; MTN ABP 5.20
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Rank: Veteran Joined: 8/16/2009 Posts: 994
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obiero wrote:''Loss making Kenya Airways'' what a way to headline a story. Like referring to ''Yule mtoto alianguka KCSE''.. MOVE ON! These reporters have no feelings. Especially to KQ which cannot afford an office in Nation Towers unlike the good old DJ. Time is money, so money is time. Money saved is time gained in reverse! Money stores your life’s energy. You expend your energy, get paid money, and store that money for a future purchase made in a currency.
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Rank: Chief Joined: 1/3/2007 Posts: 18,290 Location: Nairobi
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obiero wrote:''Loss making Kenya Airways'' what a way to headline a story. Like referring to ''Yule mtoto alianguka KCSE''.. MOVE ON! Ukweli ni ukweli.  Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 11/15/2013 Posts: 1,977 Location: Here
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VituVingiSana wrote:obiero wrote:''Loss making Kenya Airways'' what a way to headline a story. Like referring to ''Yule mtoto alianguka KCSE''.. MOVE ON! Ukweli ni ukweli. Bitter Truth!! If it would be making profit and "profit making....." Used, @ Obiero would be quoting it happily. Everybody STEALS, a THIEF is one who's CAUGHT stealing something of LITTLE VALUE. !!!
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Rank: Elder Joined: 6/23/2009 Posts: 14,048 Location: nairobi
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I have never seen a headline like ''Profit making NIC..'' Shows Ngunze still hasnt worked the PR magic. Gina Din should never have been let go by KQ
KQ ABP 4.48; MTN ABP 5.20
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Rank: Chief Joined: 1/3/2007 Posts: 18,290 Location: Nairobi
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obiero wrote:I have never seen a headline like ''Profit making NIC..'' Shows Ngunze still hasnt worked the PR magic. Gina Din should never have been let go by KQ Well, if Gina had agreed to kick back some of that PR cash to your buddy... BTW, all the lipstick on a pig still doesn't change the fact a pig is a pig. The 'natural' state of a firm should be 'profitable' which KQ hasn't been for 4 years. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Chief Joined: 1/3/2007 Posts: 18,290 Location: Nairobi
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There's an over-supply of 777s. @obiero's bete noir is trying to lease/sell 777s. http://www.bloomberg.com...e-of-used-wide-body-jetsGreedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 6/23/2009 Posts: 14,048 Location: nairobi
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November 12th is fast approaching..
KQ ABP 4.48; MTN ABP 5.20
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Rank: Elder Joined: 9/20/2015 Posts: 2,811 Location: Mombasa
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what would happen in Nov 12th? John 5:17 But Jesus replied, “My Father is always working, and so am I.”
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Rank: Chief Joined: 1/3/2007 Posts: 18,290 Location: Nairobi
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Spikes wrote:what would happen in Nov 12th? Another results announcement. Another loss. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 9/20/2015 Posts: 2,811 Location: Mombasa
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If that is the case the kes 2.00 is a buy pending cash call disguised as government bailout. There is a potential of massive dilution. even sub kes 2.00 is likely. John 5:17 But Jesus replied, “My Father is always working, and so am I.”
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Rank: Veteran Joined: 11/15/2013 Posts: 1,977 Location: Here
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Spikes wrote:If that is the case the kes 2.00 is a buy pending cash call disguised as government bailout. There is a potential of massive dilution. even sub kes 2.00 is likely. @Obiero is watching you and will not take this lightly.  Everybody STEALS, a THIEF is one who's CAUGHT stealing something of LITTLE VALUE. !!!
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Rank: Elder Joined: 6/23/2009 Posts: 14,048 Location: nairobi
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Spikes wrote:If that is the case the kes 2.00 is a buy pending cash call disguised as government bailout. There is a potential of massive dilution. even sub kes 2.00 is likely. KES 2 for KQ shares?? Pepo mbaya.. Shindwe!
KQ ABP 4.48; MTN ABP 5.20
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