Company Quick10K Filing
Mesa Air
Price6.88 EPS1
Shares35 P/E5
MCap241 P/FCF2
Net Debt810 EBIT119
TEV1,051 TEV/EBIT9
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-12-31 Filed 2021-02-09
10-K 2020-09-30 Filed 2020-12-14
10-Q 2020-06-30 Filed 2020-08-10
10-Q 2020-03-31 Filed 2020-05-11
10-Q 2019-12-31 Filed 2020-02-10
10-K 2019-09-30 Filed 2019-12-17
10-Q 2019-06-30 Filed 2019-08-14
10-Q 2019-03-31 Filed 2019-05-15
10-Q 2018-12-31 Filed 2019-02-13
10-K 2018-09-30 Filed 2018-12-20
S-1 2018-07-13 Public Filing
10-Q 2018-06-30 Filed 2018-09-05
8-K 2020-11-19
8-K 2020-11-13
8-K 2020-11-12
8-K 2020-11-04
8-K 2020-10-30
8-K 2020-10-15
8-K 2020-10-08
8-K 2020-08-10
8-K 2020-06-11
8-K 2020-05-11
8-K 2020-05-05
8-K 2020-04-20
8-K 2020-04-03
8-K 2020-03-26
8-K 2020-03-18
8-K 2020-02-10
8-K 2020-02-04
8-K 2019-12-26
8-K 2019-12-13
8-K 2019-12-11
8-K 2019-11-26
8-K 2019-09-30
8-K 2019-08-09
8-K 2019-05-10
8-K 2019-04-09
8-K 2019-02-04
8-K 2019-01-28
8-K 2018-12-03
8-K 2018-09-11
8-K 2018-08-27
8-K 2018-08-08

MESA 10Q Quarterly Report

Part I - Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-10.1.1 mesa-ex1011_7.htm
EX-10.1.2 mesa-ex1012_6.htm
EX-31.1 mesa-ex311_8.htm
EX-31.2 mesa-ex312_9.htm
EX-32.1 mesa-ex321_10.htm
EX-32.2 mesa-ex322_11.htm

Mesa Air Earnings 2020-12-31

Balance SheetIncome StatementCash Flow
1.51.20.90.60.30.02016201720182020
Assets, Equity
0.20.10.10.0-0.0-0.12016201720182020
Rev, G Profit, Net Income
0.10.10.0-0.0-0.1-0.12016201720182020
Ops, Inv, Fin

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended December 31, 2020

Or

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

FOR THE TRANSITION PERIOD FROM                      TO                     

Commission File Number 001-38626

 

MESA AIR GROUP, INC.

(Exact name of registrant as specified in its charter)

 

 

Nevada

 

85-0302351

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

 

 

410 North 44th Street, Suite 700

Phoenix, Arizona 85008

 

85008

(Address of principal executive offices)

 

(Zip Code)

 

Registrant's telephone number, including area code: (602) 685-4000

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock, no par value

 

MESA

 

Nasdaq Global Select Market

 

Securities registered pursuant to section 12(g) of the Act:

None

 

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

Smaller reporting company

 

 

 

 

 

 

 

 

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes      No  

 

As of January 29, 2021, the registrant had 35,568,290 shares of common stock, no par value per share, issued and outstanding.

 

 

 


TABLE OF CONTENTS

 

PART I – FINANCIAL INFORMATION

 

 

 

Item 1. Financial Statements

2

 

 

Condensed Consolidated Balance Sheets

2

 

 

Condensed Consolidated Statements of Operations and Comprehensive Income

3

 

 

Condensed Consolidated Statements of Stockholders' Equity

4

 

 

Condensed Consolidated Statements of Cash Flows

5

 

 

Notes to Condensed Consolidated Financial Statements

6

 

 

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

23

 

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

31

 

 

Item 4. Controls and Procedures

32

 

 

PART II – OTHER INFORMATION

34

 

 

Item 1. Legal Proceedings

34

 

 

Item 1A. Risk Factors

34

 

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

34

 

 

Item 3. Defaults Upon Senior Securities

34

 

 

Item 4. Mine Safety Disclosures

34

 

 

Item 5. Other Information

34

 

 

Item 6. Exhibits

34

 

 

SIGNATURES

36

 

 


 

Cautionary Note Regarding Forward Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations and financial position, business strategy and plans, and objectives of management for future operations, are forward-looking statements. These statements involve known and unknown risks, uncertainties, and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements.

Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as "future," "anticipates," "believes," "estimates," "expects", "intends," "plans," "predicts," "will," "would," "could," "can," "may," and similar terms.  Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include but are not limited to, those discussed in Part I, Item 1A of this Annual Report on Form 10-K under the heading "Risk Factors."   Unless otherwise stated, references to particular years, quarters, months or periods refer to our fiscal years ended September 30 and the associated quarters, months, and periods of those fiscal years. Each of the terms the "Company," "Mesa Airlines," "we," "us" and "our" as used herein refers collectively to Mesa Air Group, Inc. and its wholly owned subsidiaries, unless otherwise stated.  We do not assume any obligation to revise or update any forward-looking statements.

The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Some of the key factors that could cause actual results to differ from our expectations include:

 

public health epidemics or pandemics such as COVID-19;

 

the severity, magnitude and duration of the COVID-19 pandemic, including impacts of the pandemic and of business’ and governments’ responses to the pandemic on our operations and personnel, and on demand for air travel;

 

the supply and retention of qualified airline pilots;

 

the volatility of pilot attrition;

 

dependence on, and changes to, or non-renewal of, our capacity purchase agreements;

 

increases in our labor costs;

 

reduced utilization (the percentage derived from dividing (i) the number of block hours actually flown during a given month under a particular capacity purchase agreement by (ii) the maximum number of block hours that could be flown during such month under the particular capacity purchase agreement) under our capacity purchase agreements;

 

the direct operation of regional jets by our major airline partners;

 

the financial strength of our major airline partners and their ability to successfully manage their businesses through the unprecedented decline in air travel attributable to the COVID-19 pandemic or any other public health epidemic;

 

limitations on our ability to expand regional flying within the flight systems of our major airline partners' and those of other major airlines;

 

our significant amount of debt and other contractual obligations;

 

our compliance with ongoing financial covenants under our credit facilities; and

 

our ability to keep costs low and execute our growth strategies.

Additionally, the risks, uncertainties and other factors set forth above or otherwise referred to in the reports we have filed with the SEC may be further amplified by the global impact of the COVID-19 pandemic.  While we may elect to update these forward-looking statements at some point in the future, whether as a result of any new information, future events, or otherwise, we have no current intention of doing so except to the extent required by applicable law.

 

1


Part I – Financial Information

Item 1. Financial Statements

MESA AIR GROUP, INC.

Condensed Consolidated Balance Sheets

(In thousands, except share amounts) (Unaudited)

 

 

 

December 31,

 

 

September 30,

 

 

 

2020

 

 

2020

 

ASSETS

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

181,300

 

 

$

99,395

 

Restricted cash

 

 

3,634

 

 

 

3,446

 

Receivables, net

 

 

15,412

 

 

 

13,712

 

Expendable parts and supplies, net

 

 

22,760

 

 

 

22,971

 

Prepaid expenses and other current assets

 

 

12,897

 

 

 

16,067

 

Total current assets

 

 

236,003

 

 

 

155,591

 

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

1,194,061

 

 

 

1,212,415

 

Intangibles, net

 

 

7,722

 

 

 

8,032

 

Lease and equipment deposits

 

 

1,851

 

 

 

1,899

 

Operating lease right-of-use assets

 

 

114,666

 

 

 

123,251

 

Other assets

 

 

514

 

 

 

742

 

Total assets

 

$

1,554,817

 

 

$

1,501,930

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Current portion of long-term debt and financing leases

 

$

99,745

 

 

$

189,268

 

Current portion of deferred revenue

 

 

51,253

 

 

 

9,389

 

Current maturities of operating leases

 

 

44,712

 

 

 

43,932

 

Accounts payable

 

 

47,576

 

 

 

53,229

 

Accrued compensation

 

 

7,029

 

 

 

12,030

 

Other accrued expenses

 

 

37,581

 

 

 

45,478

 

Total current liabilities

 

 

287,896

 

 

 

353,326

 

Noncurrent liabilities:

 

 

 

 

 

 

 

 

Long-term debt and financing leases, excluding current portion

 

 

624,116

 

 

 

542,456

 

Noncurrent operating lease liabilities

 

 

53,570

 

 

 

62,531

 

Deferred credits

 

 

5,176

 

 

 

5,705

 

Deferred income taxes

 

 

69,111

 

 

 

64,275

 

Deferred revenue, net of current portion

 

 

26,504

 

 

 

14,369

 

Other noncurrent liabilities

 

 

4,147

 

 

 

1,409

 

Total noncurrent liabilities

 

 

782,624

 

 

 

690,745

 

Total liabilities

 

 

1,070,520

 

 

 

1,044,071

 

Commitments and contingencies (Note 14 and Note 15)

 

 

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

 

 

Preferred stock of no par value, 5,000,000 shares authorized;

   no shares issued and outstanding

 

 

 

 

 

 

Common stock of no par value and additional paid-in capital,

   125,000,000 shares authorized; 35,532,162 (2021) and 35,526,918

   (2020) shares issued and outstanding, 4,899,497 (2021) and

  0 (2020) warrants issued and outstanding

 

 

255,092

 

 

 

242,772

 

Retained earnings

 

 

229,205

 

 

 

215,087

 

Total stockholders' equity

 

 

484,297

 

 

 

457,859

 

Total liabilities and stockholders' equity

 

$

1,554,817

 

 

$

1,501,930

 

 

See accompanying notes to these condensed consolidated financial statements.

 

2


MESA AIR GROUP, INC.

Condensed Consolidated Statements of Operations and Comprehensive Income

(In thousands, except per share amounts) (Unaudited)

 

 

 

Three Months Ended December 31,

 

 

 

2020

 

 

2019

 

Operating revenues:

 

 

 

 

 

 

 

 

Contract revenue

 

$

127,158

 

 

$

171,800

 

Pass-through and other

 

 

23,213

 

 

 

12,236

 

Total operating revenues

 

 

150,371

 

 

 

184,036

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Flight operations

 

 

36,964

 

 

 

52,644

 

Fuel

 

 

390

 

 

 

169

 

Maintenance

 

 

52,864

 

 

 

58,095

 

Aircraft rent

 

 

10,048

 

 

 

11,329

 

Aircraft and traffic servicing

 

 

901

 

 

 

1,064

 

General and administrative

 

 

13,073

 

 

 

12,996

 

Depreciation and amortization

 

 

20,470

 

 

 

20,552

 

CARES Act grant recognition

 

 

(11,311

)

 

 

 

Total operating expenses

 

 

123,399

 

 

 

156,849

 

Operating income

 

 

26,972

 

 

 

27,187

 

Other (expenses) income, net:

 

 

 

 

 

 

 

 

Interest expense

 

 

(9,082

)

 

 

(12,628

)

Interest income

 

 

126

 

 

 

58

 

Other (expense) income, net

 

 

923

 

 

 

(297

)

Total other (expense), net

 

 

(8,033

)

 

 

(12,867

)

Income before taxes

 

 

18,939

 

 

 

14,320

 

Income tax expense

 

 

4,821

 

 

 

3,535

 

Net income and comprehensive income

 

$

14,118

 

 

$

10,785

 

Net income per share attributable to

 

 

 

 

 

 

 

 

common shareholders

 

 

 

 

 

 

 

 

Basic

 

$

0.40

 

 

$

0.31

 

Diluted

 

$

0.39

 

 

$

0.31

 

Weighted-average common shares outstanding

 

 

 

 

 

 

 

 

Basic

 

 

35,531

 

 

 

35,023

 

Diluted

 

 

36,647

 

 

 

35,182

 

 

 

See accompanying notes to these condensed consolidated financial statements.

 

 

3


 

MESA AIR GROUP, INC.

Condensed Consolidated Statements of Stockholders' Equity

(In thousands, except share amounts) (Unaudited)

 

 

 

Three Months Ended December 31, 2019

 

 

 

 

 

 

 

 

 

 

 

Common

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock and

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

 

 

 

 

 

 

 

Number of

 

 

Number of

 

 

Paid-In

 

 

Retained

 

 

 

 

 

 

 

Shares

 

 

Warrants

 

 

Capital

 

 

Earnings

 

 

Total

 

Balance at September 30, 2019

 

 

31,413,287

 

 

 

3,600,953

 

 

$

238,504

 

 

$

187,364

 

 

$

425,868

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adoption ASU 2018-09 Stock compensation-

   income taxes

 

 

 

 

 

 

 

 

 

 

 

259

 

 

 

259

 

Stock compensation expense

 

 

 

 

 

 

 

 

1,320

 

 

 

 

 

 

1,320

 

Repurchased shares and warrants

 

 

(5,558

)

 

 

 

 

 

(41

)

 

 

 

 

 

(41

)

Warrants converted to common stock

 

 

1,612,481

 

 

 

(1,612,481

)

 

 

 

 

 

 

 

 

 

Restricted shares issued

 

 

18,916

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

10,785

 

 

 

10,785

 

Balance at December 31, 2019

 

 

33,039,126

 

 

 

1,988,472

 

 

$

239,783

 

 

$

198,408

 

 

$

438,191

 

 

 

 

MESA AIR GROUP, INC.

Condensed Consolidated Statements of Stockholders' Equity

(In thousands, except share amounts) (Unaudited)

 

 

 

Three Months Ended December 31, 2020

 

 

 

 

 

 

 

 

 

 

 

Common

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock and

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

 

 

 

 

 

 

 

Number of

 

 

Number of

 

 

Paid-In

 

 

Retained

 

 

 

 

 

 

 

Shares

 

 

Warrants

 

 

Capital

 

 

Earnings

 

 

Total

 

Balance at September 30, 2020

 

 

35,526,918

 

 

 

 

 

$

242,772

 

 

$

215,087

 

 

$

457,859

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock compensation expense

 

 

 

 

 

 

 

 

850

 

 

 

 

 

 

850

 

Repurchased shares

 

 

(2,256

)

 

 

 

 

 

(19

)

 

 

 

 

 

(19

)

Restricted shares issued

 

 

7,500

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of warrants, net of issuance costs

 

 

 

 

 

4,899,497

 

 

 

11,489

 

 

 

 

 

 

11,489

 

Net income

 

 

 

 

 

 

 

 

 

 

 

14,118

 

 

 

14,118

 

Balance at December 31, 2020

 

 

35,532,162

 

 

 

4,899,497

 

 

$

255,092

 

 

$

229,205

 

 

$

484,297

 

 

See accompanying notes to these condensed consolidated financial statements.

 

4


MESA AIR GROUP, INC.

Condensed Consolidated Statements of Cash Flows

(In thousands) (Unaudited)

 

 

Three Months Ended December 31,

 

 

 

2020

 

 

2019

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net income

 

$

14,118

 

 

$

10,785

 

Adjustments to reconcile net income to net cash flows provided by operating

   activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

20,470

 

 

 

20,552

 

Stock compensation expense

 

 

850

 

 

 

1,320

 

Deferred income taxes

 

 

4,836

 

 

 

3,205

 

Amortization of deferred credits

 

 

(793

)

 

 

(1,103

)

Amortization of debt discount and issuance costs

 

 

1,860

 

 

 

1,054

 

Gain on extinguishment of debt

 

 

(950

)

 

 

 

Loss on disposal of assets

 

 

24

 

 

 

407

 

Provision for obsolete expendable parts and supplies

 

 

(37

)

 

 

97

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

Receivables

 

 

(1,700

)

 

 

(1,040

)

Expendable parts and supplies

 

 

256

 

 

 

(1,158

)

Prepaid expenses and other current assets

 

 

4,296

 

 

 

327

 

Accounts payable

 

 

(5,723

)

 

 

(2,336

)

Deferred revenue

 

 

53,999

 

 

 

 

Accrued liabilities

 

 

(12,637

)

 

 

5,791

 

Change in operating lease right-of- use assets

 

 

404

 

 

 

329

 

Net cash provided by operating activities

 

 

79,273

 

 

 

38,230

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Capital expenditures

 

 

(1,773

)

 

 

(10,124

)

Net returns (payments) on equipment & other deposits

 

 

 

 

 

(2,704

)

Net cash used in investing activities

 

 

(1,773

)

 

 

(12,828

)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Proceeds from long-term debt

 

 

195,000

 

 

 

 

Principal payments on long-term debt and financing leases

 

 

(189,131

)

 

 

(36,467

)

Payments of debt and warrant issuance

 

 

(1,257

)

 

 

(184

)

Repurchase of stock

 

 

(19

)

 

 

(41

)

Net cash provided by financing activities

 

 

4,593

 

 

 

(36,692

)

 

 

 

 

 

 

 

 

 

Net change in cash, cash equivalents and restricted cash

 

 

82,093

 

 

 

(11,290

)

Cash, cash equivalents and restricted cash at beginning of period

 

 

102,841

 

 

 

72,501

 

Cash, cash equivalents and restricted cash at end of period

 

$

184,934

 

 

$

61,211

 

 

 

 

 

 

 

 

 

 

Supplemental cash flow information

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

6,743

 

 

$

9,440