A recent article from Reuters, with Brian Iler's reponse below
 
Jun 29, 2010 21:13 EDT

TORONTO (Reuters) – Porter Aviation Holdings Inc, an upstart regional challenger to Canada’s major airlines, is close to finalizing another form of financing after it shelved an initial public stock offering earlier this month due to market volatility, it’s chief executive said on Tuesday.

Robert Deluce, chief executive of Porter, said the 3-1/2 year-old carrier may go back to the IPO market in the fall, or perhaps next spring, depending on when conditions are right.

“We thought it would be appropriate to do it in June, and the market wasn’t really suitable,” he said. “So we went back to the drawing board and we’re now in the midst of sort of finalizing another form of financing, which will allow us to move forward with the growth and development.”

Porter has been luring travelers from Air Canada (ACa.TO: Quote, Profile, Research) and WestJet Airlines (WJA.TO: Quote, Profile, Research) in Eastern Canada, and had planned to raise C$120 million ($114 million) in its IPO for working capital and to buy new aircraft.

Deluce made the comments to Reuters on the sidelines of a Toronto event for low-cost domestic airline Virgin America, which is beginning daily service from California to Canada’s biggest city.

Virgin America chairman Donald Carty, who also is Porter’s chairman, said in an interview that Porter has always had more than one type of financing and getting new financing won’t be a problem.

“Porter’s balance sheet is in pretty good shape, and the fact of the matter is, there is debt financing, there is aircraft financing, there is lease financing, so there are lots of options,” he said. “And, of course, we can look at another round, if we want, of the existing partners adding some equity to the balance sheet if needed.”

Regarding Virgin Airlines, Carty, former CEO of AMR Corp — the parent company of American Airlines (AMR.N: Quote, Profile, Research) — said potential markets for expansion for that carrier are the Caribbean, Mexico, Hawaii, and other U.S. destinations.

(Reporting by John McCrank; editing by Carol Bishopric)


"Porter’s balance sheet is in pretty good shape"

Excuse me?

Porter's March 31 balance sheet, disclosed in Porter's Prospectus released May 21, reveals that a working capital deficit of $11,846,000 as of December 31, 2009) deteriorated to $33,467,000  by March 31, 2010.

And net income of $455,000 in Q4, 2009, slid in Q1 2010 to an operating loss of $5,972,000 in Q1 2010.  That loss over three months is $1,363,000 greater than the total loss for all of 2009.

Porter's accumulated deficit, as at March 31, was $44,505,000.

That's not "pretty good shape". That's a business in sore need of more capital, quickly. Or, its days are numbered.

Brian Iler