Richard Branson

[Megandllsmum]

Originally Posted by katiec68

Isn't there something about him bring able to afford giving ALL the staff £500 a week for 2 months and he would have about a 1% drop in income.

DH says we won't use them 🙄

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That sounds familiar I read something don't know if it was NHS or virgin staff, but whatever it was he wouldn't be living on the bones of his ≈≈≈≈ like lots of people will 🙄

[JasonErpelding]

Originally Posted by mickey house

Me and the wife have accepted that we might never even go back to Florida in the future if the dollar continues dropping and prices get any higher. At least we have decades of memories to fall back on😀

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Crazy times.

Jason Erpelding
Lic. Real Estate Broker
Buy and Sell DVC, Inc.®

[Libby29]

He’s certainly getting himself a reputation now.. for ALL the wrong reasons. Silly man. Not sure I want to use them anymore for holidays. (If we ever get away &#128514
They were my first choice most of the time, unless my dates didn’t match what they had.
It’s one thing to have plenty money, but ,... YOU CANT TAKE IT WITH YOU... 😱

[Guest]

I thought I would look at the report and accounts, of Virgin Atlantic as I did for Disney and BA parent IAG the other week. I am not in the industry but the basics of accounting are the same. I understand it is VA staff that are impacted.

I will start up from by saying that I am not a Virgin customer, I don’t particularly like Branson and I met him at Women in Business type of event when I lived in Australia and he was appalling. He had clearly not done five minutes of preparation, either that or he turned up drunk, although it was a breakfast event so seems unlikely.

Anyway this is my objective review of their accounts, avoiding any comment on morality. This is 2018 accounts, can’t find 2019.

Virgin Atlantic has revenue of about £2.8 billion a year, almost entirely from passenger revenue. If they keep their first quarter revenue and everything else is reduced by 75-85% for the rest of the year, they may make about £1.1 - £1.3 billion of revenue.

Their costs have previously been about the same as the revenue, a bit more in fact so they are a loss making company. They also have very little by way of retained earnings. Retained earnings are what the company would either use to pay dividends or use to absorb losses in bad years.

If the costs stayed as they are, I think it would need an injection of billions to stay afloat, which would be a significant amount of RB’s personal net worth (not income, net worth). Also note that he is not the sole owner, Delta own 49%.

BUT - costs won’t be the same.

Annual fuel costs are almost double annual employee costs so these are obviously going to be slashed. They also spend more on marketing than they do on employee remuneration, I would think this could be pared back significantly, although they could have committed costs and I don’t think they can cut it back completely.

They also spend a lot on “aircraft costs” and “repairs and maintenance”, I would assume these need to remain much as they are regardless.

I have done a quick expense exercise and have pro rated down some costs, like fuel and marketing in the same proportions as revenue and others I have kept the same, like maintenance and also employee costs. Definitely back of a fag packet, but I get costs down to £1.9billion doing this.

This would mean a loss of, say, £700m which their retained earnings can’t absorb. The issue is that the revenue is totally variable, whereas there is a big fixed costs element, so revenue and expenses don’t go down in proportion to each other.

The eight week savings on salary if it is across the board, would save A maximum of £61m (annual £400m and 400/52 x 8 = £61m). It does seem to be about 1% of RB’s net worth, however it is barely a drop in the ocean in terms of the expense problem and it wouldn’t be the expense I would tackle first. I’d be cutting my marketing and other costs before I cut my staff expenses. However I expect they are looking at everything. That is the end of my objective analysis.

Onto my opinion, whilst I think the employees should be treated better, I don’t think it is as simple as RB is rich he can sort the whole thing out with 1% of his income. They definitely have a much bigger problem than that, I would say they could be in huge trouble and he is unlikely to sacrifice a quarter of his personal net worth to save it.

[IlDivoette]

I think they are quite greedy now, so I am not surprised, their flights/holidays have been so much more than the likes of BA for instance, they couldn't come anywhere even remotely close on our trip to the West Coast last year, we wouldn't have gone if we had to pay Virgin prices.

Slightly better product I suppose, but not worthy of the thousands extra they charge.

[EssexSue]

I don't think his product is any better but hes been the cheapest for us for a while. Although I had promised myself a summer trip Tui Premium this year but that's not going to happen now.

[Guest]

Originally Posted by IlDivoette

I think they are quite greedy now, so I am not surprised, their flights/holidays have been so much more than the likes of BA for instance, they couldn't come anywhere even remotely close on our trip to the West Coast last year, we wouldn't have gone if we had to pay Virgin prices.

Slightly better product I suppose, but not worthy of the thousands extra they charge.

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They are loss making, as per my financial analysis in post above yours.

If they wanted to be greedy, they would be better off closing down.

[ERICSMUM]

Originally Posted by mickey house

I haven't flown with virgin fo many years, mainly because of the price of flights which are almost always well over the top.

Good luck if people decide not to use virgin again, but there might not be a vast choice of airlines to use in the future. Me and the wife have accepted that we might never even go back to Florida in the future if the dollar continues dropping and prices get any higher. At least we have decades of memories to fall back on😀

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Exactly how I feel. I always check Virgin flights but end up with BA for the prices. But as you say, might be a moot point at 1.3 to the pound.

[bighal]

Compare RBs action with the well know travel company I work for. We are all on going to be at home on standby for our rostered shifts on full pay. No one is being asked to take unpaid leave.

[YorkshireT]

Originally Posted by bighal

Compare RBs action with the well know travel company I work for. We are all on going to be at home on standby for our rostered shifts on full pay. No one is being asked to take unpaid leave.

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Good to hear Hal.