Mesa Air Group reports second quarter fiscal 2024 results

Mesa Air Group

Mesa Air Group, Inc. today reported second quarter fiscal 2024 financial and operating results.

Second Quarter Fiscal 2024 Update: Total operating revenues of $131.6 million. Pre-tax income of $11.7 million, net income of $11.7 million or $0.28 per diluted share.

Adjusted net income of $6.3 million2 or $0.15 per diluted share. Adjusted EBITDAR1 of $28.2 million. Flew 99.85% controllable completion factor.

Jonathan Ornstein, Chairman and CEO said: “Our second quarter results have begun to demonstrate an improvement in our business and reflect our efforts over the past year-and-a-half to restructure and strengthen our operations, P&L, and balance sheet.

“Given meaningfully improved block-hour rates on our E-175 flying, coupled with our initiatives to eliminate surplus CRJ assets, we achieved our first GAAP and adjusted net profits in 11 quarters, as well as our best adjusted EBITDAR result over that period. Concurrently, Mesa has reduced its total debt by $221.5 million, or 36%, over the past year.

“While we still have work to do as we transition out of our CRJ-900 fleet and build our E-175 flying, we expect to remain cash-flow neutral for the remainder of the fiscal year.

“With an optimized asset base, our ongoing transition toward higher-margin E-175 flying, and the continued reduction in pilot attrition and strength in our pilot pipeline, we look forward to returning to consistent profitability in the future.”

Total operating revenues in Q2 2024 were $131.6 million, an increase of $9.7 million, or 8.0%, from $121.8 million for Q2 2023.

Contract revenue decreased $10.0 million, or 9.7%. These increases were primarily driven by higher E-175 block-hour rates with United Airlines, effective as of October 1, 2023.

Mesa recognized the increased rates for Q2 2024, as well as an additional $8.8 million for Q1 2024, in this quarter. Pass-through revenue decreased by $0.3 million, or 1.6%. Mesa’s Q2 2024 results include, per GAAP, the recognition of $7.9 million of previously deferred revenue, versus the deferral of $5.7 million in Q2 2023.

The remaining deferred revenue balance of $10.2 million will be recognized as flights are completed over the remaining term of the United contract.

Total operating expenses in Q2 2024 were $119.9 million, a decrease of $28.8 million, or 19.3%, versus Q2 2023.

This decrease primarily reflects $14.1 million lower asset impairment losses, $6.7 million lower depreciation and amortization expense, and $5.5 million, or 10.0% lower, flight operations expense, driven by Mesa’s divestiture of surplus CRJ assets.

Mesa’s Q2 2024 results reflect net income of $11.7 million, or $0.28 per diluted share, compared to a net loss of $35.1 million, or $(0.88) per diluted share, for Q2 2023.

Mesa’s Q2 2024 adjusted net income was $6.3 million, or $0.15 per diluted share, versus an adjusted net loss of $21.3 million, or $(0.53) per diluted share, in Q2 2023.