MESA Loses 24 Million!!!!!

[topdawg]

$600,000 my ass.... "go!'s operating results were $700,000 below plan" (mesa press release). Below plan being the key words there. Maybe they came out here willing to lose $10 million to get Aloha out because it seemed easy and would turn into a good investment. That would make it $10.7 million so far. The true number Im sure will never be exposed. JO's already blaming it on ******************** like bad weather and Im sure the numbers will be absorbed into his other excuses.

Oh and fcuk GO!

 

[Poahi]

$600,000 my ass.... "go!'s operating results were $700,000 below plan" (mesa press release). Below plan being the key words there. Maybe they came out here willing to lose $10 million to get Aloha out because it seemed easy and would turn into a good investment. That would make it $10.7 million so far. The true number Im sure will never be exposed. JO's already blaming it on ******************** like bad weather and Im sure the numbers will be absorbed into his other excuses.

Oh and fcuk GO!

Easy there general - you're going to burst a blood vessel. $700,000 is right. I don't know what the plan was, but unfortunately, none of the carriers is reporting inter-island financial info. This fall, that will change.

The thread was about the $24 Million loss and go! is really a small part of it. Aloha isn't going anywhere.

 

[CFIse]

To try and give a balanced perspective it should be noted that Mesa had a pro forma profit. It didn't meet analysts expectations by quite a margin, but it was still a profit.

What dropped it to the loss was 2 major issues:

- Mesa "paid to play" for the United contract. That payment was being amortized over the life of the contract, Mesa has decided that the contract is no longer profitable and wrote the entire amount off in one quarter.

- Mesa made signficant capital improvements to get the Delta Dash fleet flying, they were amortizing that investment, but that contract isn't going to be profitable and it's being cut short - so they wrote that amount off in one quarter.

This was a "take out the trash" quarter - once they realised that they were going to miss analysts expectations (mostly, as I understand it, because they missed collecting on some (all?) United incentive payments, they got a power by the hour increase from GE they didn't expect, or at least didn't plan for, and they were getting raped on APU overhauls) they decided to throw everything out in one quarter.

By getting rid of the amortizing payments they make future quarters look a lot better. Also note that they got United to take some fuel costs directly, as opposed to passing them through the books as revenue. Since it was always a pass through there was no profit associated with it, so now any profit will be a larger percentage of a reduced revenue number - which the market will approve of going forward.

So Mesa will whine to United to get some kind of relief on the contract, they've already negotiated a deal with Delta MX to handle the engine work so they'll lose the GE power by the hour issue in a few quarters and who knows what will happen with the APUs, but expect a hot summer at Mesa.

It is STUNNINGLY difficult to lose money on fee for departure - although I have no doubt Mesa could handle it if they wanted. The "at risk" flying is the EAS and go!, and as a percentage of the companies revenue those are small potatoes (really, go! would be hard pushed to have a material effect on mesa financials, despite conspiracy theorists ideas).

If it was a play to get the pilots to knuckle under it was REALLY BADLY planned since:

- section 6 dosn't open until late summer, and the company has steadfastly refused to negotiate any earlier, and why would they?

- even with section 6 open push won't come to shove on the negotiations for at least 12 months - we need to bat a few totally unacceptable offers from both sides across the table a few times before anybody gets serious.

- Mesa didn't blame the pilots - which you'd figure they would if they were going to try some leverage.

I'd be willing to bet Mesa won't be able to stop itself being profitable going forward, albeit perhaps at reduced numbers, but after dumping the trash like that expectations are going to be lowered anyway. If Mesa wants to use lack of profit as leverage to screw the pilots - and they might, this wasn't the quarter they played that card, it's yet to come.

 

[hyperboy]

CFISE You are dumb

I see you on this board as well as the mesa forum...You always have an excuse and it is never that bad to you. What a jerk! I am a mesa pilot as well and you have not a clue. It is bad over here. How many days you getting off? Do you not have a life? You obviuosly don't have loved ones or if you do they don'y love you cause they have no idea who you are. You always make excuses...They took a loss and don't be an idiot about it. You need to get off "JO's kool aid hose"...have a lil more respect for yourself!

Don't make us sound like you are the majority, you are on your own pal!

 

[mdanno808]

What dropped it to the loss was 2 major issues:

- Mesa "paid to play" for the United contract. That payment was being amortized over the life of the contract, Mesa has decided that the contract is no longer profitable and wrote the entire amount off in one quarter.

- Mesa made signficant capital improvements to get the Delta Dash fleet flying, they were amortizing that investment, but that contract isn't going to be profitable and it's being cut short - so they wrote that amount off in one quarter.

This was a "take out the trash" quarter - once they realised that they were going to miss analysts expectations (mostly, as I understand it, because they missed collecting on some (all?) United incentive payments, they got a power by the hour increase from GE they didn't expect, or at least didn't plan for, and they were getting raped on APU overhauls) they decided to throw everything out in one quarter.

It is STUNNINGLY difficult to lose money on fee for departure - although I have no doubt Mesa could handle it if they wanted. The "at risk" flying is the EAS and go!, and as a percentage of the companies revenue those are small potatoes (really, go! would be hard pushed to have a material effect on mesa financials, despite conspiracy theorists ideas).

.

OK.
First you state that the United contract and Delta dash contract were unprofitable (possibly because managements bids were unrealistic?), yet you later write that "It is STUNNINGLY difficult to lose money on fee for departure". It looks to me like Mesa managed to do it.

You also claim that Mesa is being raped on APU overhauls. What are they paying vs. the average rate that a non-Mesa airline pays? If it is significantly higher, then why are they paying it? How many APU's have they had to overhaul?

As for the Go! interisland venture.... I won't go there, other than to say that losses are losses, and no BOD or shareholder likes to see them. Go! to me simply shows how out of touch and ungrounded your management team really is. Now get back under OJ's desk.

 

[CFIse]

They took a loss and don't be an idiot about it.

Well you clearly don't understand business financials - is there anything else you don't understand you'd like to embarass yourself over.

 

[CFIse]

OK.
First you state that the United contract and Delta dash contract were unprofitable (possibly because managements bids were unrealistic?), yet you later write that "It is STUNNINGLY difficult to lose money on fee for departure". It looks to me like Mesa managed to do it.

Mesa management said they were unprofitable, I don't believe they were unprofitable (well United anyway), they were less profitable than expected and the books were cooked to show them as unprofitable allowing the write-off. If you don't understand business financials don't play this game, you're out of your league.

You also claim that Mesa is being raped on APU overhauls. What are they paying vs. the average rate that a non-Mesa airline pays? If it is significantly higher, then why are they paying it? How many APU's have they had to overhaul?

Again - Mesa claimed they were being raped on APU overhauls, and I believe them, because I believe United insisted Mesa start fixing it's APUs to avoid delays and problems with ground power and air starts, not to mention passenger discomfort, although I doubt that was an issue with United. So Mesa suddenly had a lot of APUs to overhaul, any subcontractor faced with an excess of work and a desparate customer is going to up the price.

As for the Go! interisland venture.... I won't go there, other than to say that losses are losses, and no BOD or shareholder likes to see them. Go! to me simply shows how out of touch and ungrounded your management team really is. Now get back under OJ's desk.

Go!'s a money loser - they always said it was a money loser, but in the overall scheme of Mesa's financials it's not a big affect. I have my own ideas about why Mesa is operating go! in the islands, but they don't have anything to do with making money on that operation. I don't believe Mesa ever plans to make money on go!, it's partly vindictive as a part of their previous attempts to enter the market and partly to establish an operating plan to operate go! in other parts of the US.

 

[trachyte11]

I've heard from someone based in PHX that Mesa's US Air/AmWest flying is not going to be renewed. He said that some of it has already been decreased. Any truth to this?

 

[hyperboy]

CFIse NAIVE

Your a tool. I guess if we did not have GO we would have posted a profit? But WE DO and we DID NOT post a profit. Who are you? It is about as black and white as this. You either make money or you don't....WE DID NOT!

Just like everyone saying that if SWA did not hedge fuel they would not have been profitable all the past quarters but ,They did and they played the game correcty and made money.

They need to build more glass houses!

 

[CFIse]

Your a tool. I guess if we did not have GO we would have posted a profit? But WE DO and we DID NOT post a profit. Who are you? It is about as black and white as this. You either make money or you don't....WE DID NOT!

Well it's not black and white. In your simplistic mind you "lose money" if you have less money at the end of the quarter than you did at the start - but in reality the money that Mesa "lost" had been paid out months (in the case of the Delta Dash fleet) and years (in the case of United pay for play) before.

Business financials is not a cash based business - if your experience is based on trying to balance your checkbook and getting the math wrong, you're never going to understand this.