Alliance Airlines attracts the big boys of the aviation world

It started in the months after 9/11 with a fleet of Fokkers and a focus on reliability. Now this little Brisbane airline is attracting some serious attention from aviation big boys, including the Flying Kangaroo.

Alliance Airlines CEO Lee Schofield.

CHOCKS AWAY

HOW did the little Brisbane airline started just after the 9/11 attacks in the United States attract the attention of the big boys of the aviation world?

Qantas last week grabbed a 20 per cent stake in Alliance Airlines, founded by aviation veterans Steve Padgett and Scott McMillan in 2002, and by all indications the Flying Kangaroo wants to grab a bigger slice.

When City Beat visited Alliance’s Brisbane Airport HQ last year it was clear the carrier, which focuses on servicing mining towns, ran a pretty tight ship.

Alliance Airlines boss Lee Schofield is proud the carrier has never recorded a loss. File picture

No fancy corporate offices and perks, just a fleet of workhorse Fokkers and a focus on reliability. That’s clearly what attracted Qantas, which may also see the uptick in mining working in Alliance’s favour.

During the past 17 years, Alliance has proved wrong the old joke that to make
$1 million from an airline, you need to start with
$10 million.

In fact, Alliance Airlines executive director Lee Schofield says proudly that the carrier has never reported a loss, a very unusual occurrence in the volatile aviation industry. It’s interesting to note that in the same week Qantas came on board as an investor, Austrian Airlines sold its 8 per cent stake. Austrian Airlines initially took a stake in the carrier when it sold its entire fleet of 21 Fokker aircraft to Alliance in 2015.

VGI director Rob Luciano reports that it’s been a good year for the investment firm. File picture

CAUGHT SHORT

IT’S been a good year for Sydney investment firm VGI Partners, the company that hit the headlines last year shorting Brisbane’s Corporate Travel Management (CTM).

VGI director Rob Luciano told investors on a call yesterday that the firm made a total net return in the 12 months to December 31 of 16.9 per cent, of which 4.1 per cent came from its shorting activity. Luciano stressed that CTM was not its biggest short but neither had it reduced its short position in the travel company. Luciano ended the call by summing up VGI’s short strategy as targeting “frauds, fads and failures”. Ouch! CTM has refuted VGI attacks on its reporting and accounting standards.

ON THE SLIDE

TAMAWOOD founder Lev Mizikovsky appears to be trying the old investor trick of catching a falling knife as the building company’s shares come off the boil. The Harley-riding Mizikovsky has bought about $122,000 worth of stock in the company in the past week for $3.57 a pop. Tamawood shares have fallen 8 per cent so far this year amid tightening conditions in the home building market.

In an investor presentation last week, Tamawood said margins had been affected by expansion into new areas and the impact of numerous factors affecting homebuyer sentiment.

RAIN MAKER

WITH the rain still pelting down up north, the debate continues among City Beat readers about resurrecting the Bradfield Scheme and turning back the rivers into the arid inland.

Reader Terry Tomsett says that way back in 2007 he sent a proposal to the State Government based on a variation of the Bradfield scheme to not only assist inland Queensland and the southeast, but help regenerate the Murray-Darling Basin.

Terry’s idea was to construct a pipeline 2m in diameter from the upper reaches of the Burdekin River, inland of the Great Dividing Range and south to an area around Dalby.

Another City Beat reader weighed in yesterday to say Bradfield’s was a feasible idea that would help prevent the Great Barrier Reef from being silted up.

“After all – we have managed tunnels under the river and city to move traffic,” the reader says.

“It is only necessary to get the water to a river system and it will eventually reach Lake Eyre and then ultimately on to the Murray.”