Mesa Air Group Reports Third Quarter Fiscal 2025 Results and Provides Update on Proposed Merger with Republic Airways Holdings Inc.

Core Viewpoint - Mesa Air Group reported significant operational and financial restructuring in Q3 fiscal 2025, leading to improved performance and optimism regarding the proposed merger with Republic Airways Holdings Inc. Financial Performance - Total operating revenues for Q3 2025 were $92.8 million, a decrease of $18.0 million or 16.3% compared to $110.8 million in Q3 2024 [10] - GAAP net income was $20.9 million, or $0.50 per diluted share, compared to a net loss of $19.9 million, or $(0.48) per diluted share, in Q3 2024 [13] - Adjusted net loss was $0.6 million, or $(0.01) per diluted share, versus an adjusted net loss of $9.4 million, or $(0.23) per diluted share, in Q3 2024 [13] - Adjusted EBITDA for Q3 2025 was $6.0 million, down from $8.9 million in Q3 2024 [14] Operational Highlights - Daily block hour utilization increased to 9.8 hours, up 15.4% year-over-year and 5.1% sequentially [4] - The company achieved a controllable completion factor of 99.99% for United during Q3 2025, compared to 99.94% in Q3 2024 [15] - Mesa operated 60 E-175 jets under its capacity purchase agreement with United Airlines [15] Merger Update - The combined company post-merger is estimated to have a twelve-month run-rate annual revenue between $1.8 billion and $2.0 billion [6] - Republic generated approximately $169 million in adjusted EBITDA in the first half of 2025, while Mesa generated $14 million, totaling $183 million [6] - The pro forma cash and debt balances of the combined company post-merger are expected to exceed $300 million and approximately $1.1 billion, respectively [9] Asset Transactions - Mesa closed on sales of surplus CRJ assets for gross proceeds of $17.2 million, which were used to repay U.S. Treasury debt [7] - Subsequent to the June 2025 quarter end, Mesa entered into purchase agreements for additional assets and closed on sales of 8 spare engines and 5 surplus CRJ-900 airframes for gross proceeds of $11.7 million [7] Balance Sheet and Liquidity - As of June 30, 2025, Mesa had $42.5 million in unrestricted cash and cash equivalents and $113.7 million in total debt, down from $366.4 million a year earlier [16] - The company paid $17.9 million in debt during the quarter, primarily related to CRJ asset sale transactions [16]