The pilot shortage issue is an industry wide problem but I think...

The pilot shortage issue is an industry wide problem but I think the market is overestimating its financial impact on Rex. Reading the statistics below, I expect Rex's financial result for 2HY18 to be as good if not better than the 1HY18 result.  

	Column 1	Column 2	Column 3	Column 4	Column 5	Column 6	Column 7	Column 8	Column 9	Column 10	Column 11	Column 12	Column 13	Column 14
0	Key Stats	Jul-17	Aug-17	Sep-17	Oct-17	Nov-17	Dec-17	1HY18	Jan-18	Feb-18	Mar-18	Apr-18	May-18	2HY18
1	Cancellations	2.30%	1.40%	1.90%	2%	2.1%	1.0%	1.8%	0.2%	0.5%	0.5%	1.0%	0.7%	0.6%
2	ASK (change from PCP)	-3%	-2%	-4%	1%	-2.0%	-7.0%	-2.8%	-1.0%	-4.0%	-9.0%	-5.0%	-4.0%	-4.6%
3	Pax carried (change from PCP)	5%	4%	2%	6%	4.0%	-1.0%	3.3%	7.0%	1.0%	1.0%	6.0%	2.0%	3.4%
4	Load factor (change from PCP)	3.60%	2.70%	3.60%	2.70%	3.5%	3.5%	3.3%	4.1%	3.3%	6.2%	7.0%	4.9%	5.1%

Based on data published by Rex, flight cancellations has reduced from 1.8% in 1HY18 to 0.6% in 2HY18.

How was this achieved? Rex has further reduced flights/ capacity across the network which can be seen in the available seat kilometres (ASK) falling an average of 4.6% (pcp) in 2HY18 compared to an average fall of 2.8% (pcp) in 1HY18. However, an important point is that this reduction in capacity has not reduced passenger numbers, as the growth in pax (pcp) for 2HY18 has been consistent with 1HY18.

So the reduction in capacity coupled with continued growth in passenger numbers has resulted in load factor increasing an average 5.1% (pcp) in 2HY18. In the airline industry, increased load factor means increased profits.  

As far as I can see the only chink in the armour is higher jet fuel prices but this is tempered from the reduced capacity.

IMHO, the market is still under appreciating Rex's value.

http://chasingvalue.com.au/