Mesa Air Group, Inc. (NASDAQ: MESA) today reported second quarter fiscal 2020 financial and operating results.

Mesa’s Q2 2020 results reflect net income of $1.9 million, or $0.05 per diluted share, compared to net income of $13.2 million, or $0.38 per diluted share for Q2 2019.  Mesa’s Q2 2020 pre-tax income was $3.2 million, compared to $17.3 million for Q2 2019.  In addition, Mesa’s Adjusted EBITDA¹ for Q2 2020 was $35.3 million, compared to $53.7 million in Q2 2019 and Adjusted EBITDAR¹ was $47.6 million, compared to $67.8 million in Q2 2019. The primary reason for the $14.1 million reduction in pre-tax income from Q2 2019 to Q2 2020 was the anticipated increase in airframe and engine heavy maintenance of $10.1 million and $4.0 million in reduced revenue in March as a result of COVID-19.

“This is an incredibly difficult time for our industry and our country,” said Jonathan Ornstein, Mesa Air Group Chairman and Chief Executive Officer. “We are taking every measure to manage our resources responsibly. I am deeply appreciative of all our employees for their dedication and commitment and would also like to thank the Congress and the Administration for the very significant assistance we received under the CARES Act. We continue to work closely and cooperatively with our partners through this tumultuous period.”

“The health and safety of our employees and passengers is our top priority,” said Brad Rich, Executive Vice President and Chief Operating Officer. “Together with United and American, we continue to implement a number of procedures to ensure our aircraft and work areas are as clean and safe as possible.”

From a fleet perspective the twenty new E175s for United initially planned to be delivered starting this month have been delayed until late 2020 and early 2021. The Mesa CRJ-700 fleet of twenty aircraft that were planned to be removed will stay in the United CPA until the new E175s are delivered and are scheduled to be leased to another United Express carrier. Other fleet changes include the removal of three aircraft from the American CPA that were previously deferred. Two of these aircraft will be removed in May and one in June.

Mesa ended the quarter at $52.4 million in unrestricted cash and equivalents compared to $57.8 in Q1 FY2020. During the quarter we drew down the line of credit facility by $23 million, paid $11 million in deposits in connection with previously ordered engines, paid $3 million in capital expenditures, paid $8 million in property tax for prior periods and had $6 million in cash lease payments in excess of book lease amounts. Additionally, Mesa paid $43 million in scheduled principal payments on aircraft and engine debt. As previously disclosed, Mesa expects to receive a total of $92.5 million in connection with the Payroll Support Program under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) covering the period April through September 2020. In April Mesa received $30.8 million under the program and expects to receive $15.4 each month from June through September.

Mesa has also applied for a loan under the CARES Act and will be meeting with the Treasury Department and their advisors in the coming weeks to determine amounts that are available to Mesa. Mesa will then evaluate its participating in the loan program and determine how much if any additional debt to take on.

Due to uncertainty related to COVID-19 the company is not providing guidance at this time.