Core Insights - Mesa Air Group reported its sixth consecutive quarter of positive EBITDA and EBITDAR performance, with an expected block-hour-per-day utilization of 9.8 in the upcoming quarter [3] - The company has transitioned its fleet to exclusively operate 60 E-175 aircraft, following the retirement of the CRJ-900, which it launched in 2003 [3] - The company is focused on closing sales of surplus CRJ assets and repaying debt obligations in preparation for a merger with Republic Airways [3] Financial Performance - Total operating revenues for Q2 2025 were $94.7 million, a decrease of $36.8 million, or 28.0%, compared to $131.6 million in Q2 2024 [4] - Contract revenue fell to $68.4 million, down by $45.4 million, or 39.9%, from $113.8 million in Q2 2024, primarily due to reduced contractual aircraft with United Airlines [4] - Total operating expenses increased to $152.0 million, an increase of $32.1 million, or 27%, compared to Q2 2024, largely due to net losses on asset sales [6] Loss and Adjusted Metrics - The company reported a net loss of $58.6 million, or $(1.42) per diluted share, compared to a net income of $11.7 million, or $0.28 per diluted share, in Q2 2024 [9] - Adjusted net loss for Q2 2025 was $2.9 million, or $(0.07) per diluted share, compared to an adjusted net income of $6.3 million, or $0.15 per diluted share, in Q2 2024 [9] - Adjusted EBITDA for Q2 2025 was $8.3 million, down from $26.8 million in Q2 2024, while adjusted EBITDAR was $9.6 million compared to $28.2 million in the prior year [10] Operational Highlights - The controllable completion factor for United was reported at 99.9% for Q2 2025, consistent with the previous year [11] - The company operated 60 large jets under its capacity purchase agreement with United, comprising 57 E-175s and three CRJ-900s [12] - Mesa's operational metrics showed a decrease in available seat miles by 11.3% and a reduction in block hours by 12.7% compared to Q2 2024 [22] Balance Sheet and Liquidity - As of March 31, 2025, Mesa had $54.1 million in unrestricted cash and cash equivalents, with total debt of $131.7 million, significantly reduced from $400.1 million a year prior [13] - The company paid down $25.6 million in debt during the quarter, primarily from CRJ asset sales [13] - Mesa's total assets were reported at $214.9 million, down from $596.9 million as of September 30, 2024 [20]

Financial Data and Key Metrics Changes - Revenues for Q1 were $130.4 million, with EBITDAR at $20.2 million, maintaining operating margins consistent with Q1 of the previous year despite challenges [4][5] - The impact of weather, leap year, and reduced sports betting revenue in Colorado was estimated to be around $2 million compared to Q1 last year [5] - Carded gaming revenue increased by 1%, while uncarded gaming revenue decreased by 2.5% across all U.S. properties [5] Business Line Data and Key Metrics Changes - In Missouri, the new Carratus property saw carded gaming revenue grow by 12% and uncarded revenue increase by 23%, leading to a total gaming revenue increase of 17% or $2.1 million compared to Q1 last year [6][7] - The Century Casino and Hotel in Cape Girardeau experienced a 5% increase in patrons and a 2% increase in trips, although gaming win was flat due to lower hold [12] - In Colorado, carded revenue grew by 7% in Central City, while uncarded revenue decreased by 36% [13][14] Market Data and Key Metrics Changes - Total visitor volume decreased by 3%, with a notable reduction in visits from the 50 age group, partially offset by a 1% increase from younger guests [6] - The number of patrons living more than 75 miles from the Carratus property increased by 34%, contributing to a 23% increase in total visitors [9] - In the East segment, high-end customers outperformed low to mid-tier customers, with gaming revenue from the upper segment increasing by 10% [16] Company Strategy and Development Direction - The company is focusing on expanding its market presence, particularly in Missouri, with plans for sports betting to go live towards the end of the year [13] - There is a commitment to operational discipline and efficiency improvements, with expectations for higher EBITDA and cash flow moving forward [24] - The company plans to balance a conservative CapEx program with returning capital to shareholders, including stock buybacks [28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about improving consumer behavior and spending patterns since mid-March, with April showing an estimated 5% increase in EBITDA compared to last year [25][26] - Despite economic uncertainties, management is more confident in the long-term prospects of the company than in the previous year [26] - The company does not anticipate significant competitive supply impacting its operations this year or next [27] Other Important Information - The company's cash and cash equivalents at the end of the quarter were $85 million, with a total principal amount of debt outstanding at €340 million [23] - The company expects to spend $4 million on growth projects and $14 million on maintenance CapEx this year [24] - The company is in discussions regarding the potential sale of its Polish operations, with two interested parties emerging [22] Q&A Session Summary Question: Have you noticed any softening in consumer behavior for your Canadian assets? - Management indicated that lower revenue is not significant and attributed it to weather and one less gaming day, expressing no concerns [33] Question: Can you provide an update on initiatives at Rocky Gap? - Management mentioned completed renovations and marketing initiatives targeting the Baltimore and Washington DC areas to attract higher net worth guests [36] Question: What has changed regarding year-end leverage targets? - Management noted a positive trend since mid-March but remained cautious about projecting this trend for the full year [44] Question: Are you looking to monetize your casino database in Alberta? - Management mentioned potential partnerships with the Alberta Gaming Commission for database sharing but did not see other opportunities at this time [48] Question: What is the strategy for revenue growth in Missouri? - Management confirmed a proactive approach to push revenue up while maintaining cost discipline, particularly targeting the 75+ mile customer base [55] Question: What is the timeline for the sale of Polish assets? - Management believes the sale could happen in 2025 but acknowledged previous misestimations regarding the timeline [57] Question: What is the capacity for stock buybacks? - Management indicated plans to start stock buybacks with a single-digit million dollar volume between now and the next earnings release [59]

Financial Data and Key Metrics Changes - In 2024, the company generated over $3.9 billion in revenues, setting a full-year record, and achieved EBITDAR of nearly $1.4 billion with property-level operating margins exceeding 40% [6][22] - The fourth quarter revenues surpassed $1 billion for the first time, with EBITDAR increasing to nearly $380 million [7][22] - The online segment generated $108 million in EBITDAR for the full year, including $32 million in non-recurring market access fees [27] Business Line Data and Key Metrics Changes - The Las Vegas Local segment delivered strong year-over-year performance, with operating margins exceeding 50% [9] - The Downtown Las Vegas segment showed consistent customer trends with growth in play from core customers and stable retail customer play [10] - The online segment contributed significantly to company-wide growth, with expectations to generate approximately $80 million to $85 million in 2025 [27][14] Market Data and Key Metrics Changes - Southern Nevada's economy remains strong, with employment growth for 45 consecutive months and average weekly wages increasing nearly 6% [11] - Total visitation to Las Vegas grew more than 2% over the prior year, reaching nearly 42 million visitors in 2024 [11] - Airport traffic exceeded 58 million passengers last year, with airline capacity expected to increase by another 3% [11] Company Strategy and Development Direction - The company is focused on strategic growth investments, including ongoing renovations and expansions at various properties [16][20] - A significant $750 million resort development project in Norfolk, Virginia, is set to begin shortly, diversifying the company's portfolio [20][21] - The company plans to maintain a balanced approach to capital allocation, returning capital to shareholders while investing in growth opportunities [22][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term strength of the Southern Nevada economy as they enter 2025 [12] - The company expects stability to return to the Orleans and Gold Coast properties in the second half of 2025 [32] - Management noted that while there are expense pressures, they are moderating, and they can manage margins effectively [42][44] Other Important Information - The company repurchased $686 million in stock in 2024, with a commitment to continue repurchasing $100 million per quarter in 2025 [21][31] - The company celebrated its 50th anniversary in 2024, reflecting on its growth from a single property to one of the largest gaming companies in the U.S. [23][24] Q&A Session Summary Question: Insights on core vs. retail customers for 2025 - Management expects core customers to continue growing, while retail customers outside Las Vegas have been stable, with potential for positive growth in the future [35][36] Question: Flow-through and margin expectations for 2025 - Management anticipates expense pressures to moderate and expects to manage margins effectively, with property-level margins consistently above 40% [41][44] Question: Impact of legislative changes on business - Management indicated that any reduction in taxes on tips or overtime pay could support business growth, but specific financial impacts are uncertain [92] Question: Capital allocation strategy regarding M&A - The company prefers to purchase HoldCo over OpCo but remains flexible with leverage for the right acquisition, maintaining a disciplined approach to M&A [78][80] Question: Performance of the Treasure Chest property - The company reported that Q4 performance from Treasure Chest was better than Q3, indicating strong ongoing performance [106]