Go!’s average fare up $9 in past 6 weeks, CEO says
Mesa Air Group Inc.
's chief executive said on a conference call yesterday that go!'s average fare during the last six weeks has risen approximately $9 over fares at the end of its fiscal third quarter, which ended June 30. Its number of passengers is running between 80,000 and 85,000 a month.
Go!, which a year ago was charging $39 for its lowest one-way fares, has boosted its bottom fares to $64 to keep up with higher fuel costs.
Jonathan Ornstein, chairman and CEO of go! parent Mesa, said go! is starting to benefit from the drop in oil and that average fuel costs have fallen 60 cents a gallon from the average of last quarter.
The conference call came one day after Mesa announced that go!'s fiscal third-quarter loss doubled to $7.4 million from $3.7 million in the year-earlier period while revenue increased 151 percent to $15.6 million from $6.2 million.
Ornstein said that go! last quarter had a lot of one-time expenses -- such as legal and maintenance costs -- and that Mesa, which had $60.1 million in restricted and unrestricted cash as of June 30, is analyzing its go! operations to determine the carrier's viability.
"At this point, we still feel confident that with any help from fuel, primarily, I think we're in reasonably good shape," he said.
While Mesa remains committed to go!, it has given up on its Kungpeng Airlines joint venture in China with Shenzhen Airlines. Mesa said it signed a letter of intent to sell its interest in Kunpeng to Shenzhen and recorded a loss on its investment in Kunpeng of $1.3 million. The loss reflected the expected proceeds from the sale of $4.8 million minus Mesa's investment of $5.8 million and estimated transaction costs of $300,000 at the end of last quarter.
Mesa will continue to sublease five regional jets to Kunpeng.