Mesa Air Group has reported its fourth quarter and full-year fiscal 2019 financial and operating results.
Mesa reported net income of $47.6 million, or $1.36 per diluted share, for the 2019 fiscal year, compared to net income of $33.3 million, or $1.32 per diluted share for the 2018 fiscal year. Excluding special items for both periods adjusted net income was $57.5 million or $1.64 per diluted share for the 2019 fiscal year compared to $30.4 million or $1.20 per diluted share for the 2018 fiscal year.
Mesa’s fiscal year 2019 pre-tax income was $63.3 million, compared to $15.8 million for the 2018 fiscal year. Excluding special items, adjusted pre-tax income1 was $76.4 million for fiscal year 2019, compared to $43.0 million for the 2018 fiscal year.
In addition, Mesa’s Adjusted EBITDA was $208.7 million in fiscal year 2019, compared to $164.8 million in the 2018 fiscal year and Adjusted EBITDAR was $260.9 million in fiscal year 2019, compared to $233.7 million in the 2018 fiscal year.
Operationally, Mesa Air ran a 99.4% controllable completion factor compared to 99.2% in 2018 and a 97.0% total completion factor, which includes weather and other uncontrollable cancellations, compared to 97.7% in 2018.
On December 3, 2019, the company announced it will be adding 20 new Embraer E175 LL aircraft to its United Express fleet. The aircraft will be owned and financed by Mesa and be covered under a 12-year capacity purchase agreement. Deliveries are scheduled to begin May 2020 and expected to be completed by the end of 2020. In addition to the new aircraft, the contract for 42 existing E175s, which are owned by United, has been extended an additional five years. The 18 Mesa-owned E175s are contracted through 2028. As part of the deal, Mesa will lease its 20 CRJ-700 aircraft to another United Express carrier.
“We made meaningful progress across the board this year, from pilot hiring and training to our maintenance resources,” said Jonathan Ornstein, Chairman and Chief Executive Officer. “After safety, performance remains our top priority for both our American Eagle and United Express operations in 2020. We continue to invest in staying ahead of the pilot and mechanic hiring curve which we believe, in addition to our industry leading cost structure, contributed to United awarding Mesa with a long term contract for 20 new E175s. We appreciate all of our employees and thank them for their professionalism and dedication each day.”
Mike Lotz, President and Chief Financial Officer, continued, “Year over year we have made significant improvement in earnings, primarily a result of double-digit block hour growth with effectively the same fleet count. During the year, we purchased and financed ten CRJ-700 aircraft previously leased reducing the number of leased aircraft from third parties to 18. We also extended our $35 million secured credit facility for three additional years at lower interest rates.”
“Our employees delivered improved operating results this year compared to last year while flying 11 percent more block hours,” said Brad Rich, Executive Vice President and Chief Operating Officer. “Although we faced a number of operational challenges this year, some of which were out of our control, we see continued improvement across our American and United operations. In light of our current performance, we expect the balance of 2020 to show further year over year operational improvement as a result of new initiatives. Since gaining access to additional spare aircraft in our American fleet, the November controllable completion factor was 99.7% and, through the first 10 days of December, we have not had a controllable cancel.”