Go! banks first profit
POSTED: Wednesday, February 18, 2009
It took 10 consecutive losing quarters, but go! finally has its first profit.
The interisland carrier operated by Phoenix-based Mesa Air Group broke into the black in its fiscal first quarter ended Dec. 31 when it posted earnings of $500,000 on $11.6 million in revenue.
A year ago, go! had a first-quarter loss of $6.5 million on $6.2 million in revenue.
It also was a profitable quarter for the parent company as Mesa posted net income of $15.3 million, or 55 cents a share, compared with a loss of $4.2 million, or 15 cents a share, a year earlier. Revenue, however, fell 18.8 percent to $265.1 million from $326.6 million due to a year-over-year decrease in capacity and lower fuel revenue.
Jonathan Ornstein, chairman and chief executive of Mesa, said today that go! remains committed to the Hawaii market and that "we feel we have a longtime future in Hawaii,"
"We're anxious to move forward with the rebranding of the company because we think it will make us more competitive," Ornstein said, referring to a federal Bankruptcy Court hearing that would determine whether former Aloha Airlines majority shareholder Yucaipa Cos. could proceed in purchasing the Aloha Airlines name and then sell that name to Mesa. A once-delayed hearing on that matter, rescheduled for tomorrow, has been postponed again to March 3.
"We also remain committed to flying to all the cities currently served by go! and go!Express. And with our agreement with Mokulele (Airlines) terminating in April, we will continue to fly to those cities (such as on Lanai and Molokai and between neighbor islands) as go!Express with our own aircraft or a partner airline."
Ornstein declined to identify the potential partner airline.
Mesa, which until last quarter had lost $49.7 million from its go! operations since the interisland service debuted in June 2006, said go!'s available seat miles, or one seat carried one mile, rose 15.4 percent in the quarter over a year ago while passenger traffic rose 11.3 percent and departures increased 11.4 percent. Mesa also said that go!'s load factor increased during the quarter and fuel prices were "reduced significantly."
The parent company, which has seen its stock price sink to pennies a share, said it was able to purchase senior convertible notes in the first quarter at a substantial discount that resulted in a gain of about $8.1 million.
The company ended the quarter with $64 million in cash, down from $64.9 million at the end of the fourth quarter.