Categorized | Business

Mesa Air Group reports go! achieves first profitable quarter

MEDIA RELEASE

Mesa Air Group, Inc. has announced first quarter net income from continuing operations of $15.5 million on operating revenues of $265.1 million. Total operating revenues for the first quarter of 2009 decreased $61.5 million, or 18.8 percent, primarily resulting from a year-over-year decrease in capacity and lower fuel revenue. 

The net income of $15.5 million, or $0.46 per share on a diluted basis, compares to net loss from continuing operations of $2.8 million, or $0.10 per diluted share for the same period of fiscal 2008. 

Pro forma net income for the quarter was $10 million or $0.31 per diluted share. Pro forma net income for the quarter includes adjustments for the following items on an after tax basis: $5.0 million gain on extinguishment of debt, $0.8 million income from equity method investments, $0.5 million of go! legal, $0.4 million in startup costs associated with our Chinese joint venture, $0.2 million of lease return costs, and $0.1 million loss on disposal.

Total available seat miles for the first quarter of fiscal 2009 decreased 18.4 percent from the first quarter of 2008. The decrease was primarily due to a reduction in the number of aircraft flown from 183 as of Dec. 31, 2007 to 151 as of Dec. 31, 2008. Included in the fleet are five regional jets in Hawaii, operating as go!

The go! operation generated approximately $0.5 million of net income on $11.6 million of revenue for the first fiscal quarter of 2009. Available seat miles increased in the first quarter 15.4 percent in comparison to the same period in the prior fiscal year. Fuel prices were reduced significantly in the quarter and go! experienced increases in passenger revenue, and load factor. Departures increased 11.4 percent and passengers carried increased 11.3 percent over the first quarter of 2008.

On Nov. 28, Mesa announced entering into a settlement with the former controlling shareholder of Aloha Airlines concerning the Aloha Airlines lawsuit over Mesa’s Hawaiian inter-island flight services operated under the go! brand name. 

Under the terms of the settlement and without admitting any wrongdoing, Mesa agreed to make a $2 million cash payment, issue shares of common stock equal to 10 percent of its then outstanding shares and provide inter-island travel benefits to certain former Aloha Airlines employees. 

The company recorded a charge of $2.8 million related to this transaction in the fourth fiscal quarter of 2008. Under the terms of the settlement, if the shareholder is able to purchase the “Aloha” name in the bankruptcy court auction, it will license the “Aloha” name to Mesa.

“We are encouraged by this quarter’s performance and the strides we have taken to put some difficult hurdles behind us. We are also very pleased to report go! achieved its first quarterly profit and we remain committed to our independent inter-island operation,” said Mesa Chairman and CEO, Jonathan Ornstein. “We continue to execute our restructuring plan and take steps needed to improve the financial and operational performance of the company. While the environment continues to be challenging we remain confident that working together our company can build upon the success of this quarter.”

— Find out more:

Mesa Air Group: www.mesa-air.com

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