Kungpeng on it's way out?

rightseatjocky

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Mesa reports quarterly loss, plans to sell stake in Chinese JV

Wednesday August 20, 2008
Mesa Air Group reported a $3.7 million loss for the fiscal third quarter ended June 30, reversed from a $2.6 million profit in the year-ago period, and said it intends to sell its share in its Chinese regional joint venture Kunpeng Airlines back to its partner in the venture, Shenzhen Airlines.
Operating revenue was up 4% year-over-year to $353.9 million but expenses climbed 9.3% to $357.1 million, resulting in an operating loss of $3.2 million compared to a $13.6 million profit a year earlier.
"While the industry in general, and Mesa in particular, face a number of challenges in today's exceptionally difficult operating environment, we remain resolutely committed to returning the company to sustained profitability," Chairman and CEO Jonathan Ornstein said. He said higher fuel costs and a $7.4 million loss at Mesa's Hawaiian subsidiary go! were key factors in the result.
Xi'an-based Kunpeng has been operating at a loss and recently announced a decision to transfer its operating base to the more heavily populated provincial capital of Zhengzhou (ATWOnline, Aug. 4). It operates five CRJ200s that Mesa will continue to lease to it if the sale goes through. "If we were in a different situation, we would have a different view," Ornstein said yesterday. "The cash right now is more valuable to us." He did not disclose how much Shenzhen will pay for Mesa's stake. The two have signed a letter of intent.
At quarter's end Mesa's fleet had declined to 161 aircraft from 199, Ornstein said. As a result, third-quarter capacity dropped 10.9% to 3.46 billion ASMs and RPMs were down 14.2% to 1.56 billion. Load factor fell 3 points to 77%.
For the nine-month period, Mesa reported a net income of $1.4 million compared to a loss of $13.4 million a year ago.

by Sandra Arnoult

Wow, I almost left my company for this!! I guess ASA isn't so bad!!
:beer:
 

Soverytired

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I'm more interested in how Mesa managed to "only" lose $1.4 million vs. $13.4 million a year ago.

I wonder if the pilots who were on a LOA from Mesa to fly in China will be allowed to come back to their jobs, or if they'll be out on the street along with the rest of the furloughed pilots? They did Mesa a favor by crossing the Pacific to endure some real hardship to help this cockamamie plan . . . so of course they'll be "rewarded" with a typical Mesa "we never promised you anything" response, I'm sure.
 

SpauldingSmails

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I'm more interested in how Mesa managed to "only" lose $1.4 million vs. $13.4 million a year ago.
I thought it said "a net income of $1.4 mil."

Upon closer inspection however, we still see the gist of the article is that Mesa sucks.
 
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