Higher expenses drag Mesa Q4 profits

Mesa Air Group reported a net profit of $12m for its Q4 2019, down from $19m during the same quarter in 2018 as Phoenix-based regional carrier Mesa Airlines expands its fleet. Operating revenue during the quarter rose 6% year-on-year to $188m, compared with $177m during Q4 2018, Mesa reported on 11 December. Revenue was partially offset by higher operating expenses, which rose 15% year-on-year from $136m to $157m during Q4. Mesa operates regional flights on behalf of United and American Airlines as United Express Airlines and American Eagle, respectively. On 3 December United awarded Mesa with a 12-year capacity purchase agreement to operate 20 new Embraer E175s for United Express, which will be owned by the Phoenix-based carrier. Deliveries are scheduled to begin in May and are expected to be completed by the end of 2020, Mesa CE Jonathan Ornstein said during an earnings call. Mesa was able to secure this long-awaited deal in part because “we continue to invest in staying ahead of the pilot and mechanic hiring curve”, Ornstein says. He adds “we are paying down a significant amount of debt” to complete purchases of its existing aircraft.<br/>