Mesa avoids de-listing from Nasdaq

Copyright: Jaromir Chalabala/ Shutterstock

US regional airline company Mesa Air Group has regained compliance with the Nasdaq stock market’s listing rules, which require companies to sustain stock prices above $1. 

The Phoenix-based parent of regional carrier Mesa Airlines disclosed on June 5 that it had received a notification from the Listing Qualifications Department of the stock exchange that it had maintained a closing bid price of $1 for at least 10 consecutive trading days, returning it to good standing.

Mesa’s stock stayed over a closing bid of $1 between May 20 and June 3 and is currently selling for more than $1.40. 

”Mesa has thus satisfactorily regained compliance with the minimum bid price requirement and Nasdaq considers the matter closed,” it said. 

The struggling company first received notice that it risked de-listing from the Nasdaq in November 2023 because its stock price had dipped below $1 for 30 consecutive trading days.

It received a 180-day extension last month and also transferred its common stock to a tier of the Nasdaq stock market with less stringent financial and liquidity requirements. 

The company will continue trading under the symbol “MESA”. 

Mesa previously risked de-listing because it had not filed an end-of-year report for the period ending 30 September. After months of delays, the company filed its fiscal fourth-quarter earnings report in late January. 

The company then delayed reporting financial results for its fiscal first quarter. On 24 May, Mesa Air Group reported that it lost $57.9m during the final three months of 2023, compared with a $9m loss during the prior-year period. 

Revenue was down to $119m from $147m during the same three months of 2022, as its block hour flying and capacity as measured in available seat miles decreased by 8.4% and 12.7%, respectively. 

The struggling company has not flown enough block hours to cover costs since it transferred all of its Bombardier CRJ-family aircraft from American Airlines to United Airlines last year. 

However, Mesa says that United has agreed to pay it a “significantly higher block-hour rate” for flying Embraer 175s on its behalf. 

Earlier this year, Mesa Airlines stopped providing air cargo services for DHL due to a “reduction in cargo demand”.

Mesa Air Group said in its first quarter 2024 results release that Mesa Airlines had agreed to reduce its freighter service with DHL from February.

“As a result of the reduction in cargo demand, Mesa and DHL mutually agreed to wind down cargo operation as of February 2024.”

Mesa did not provide any further details about the nature of its operations for DHL, but in July 2020 the company won a contract to provide air cargo services for DHL Express utilising Boeing 737-400F cargo aircraft. 

The agreement involved Mesa operating two 737-400F from the DHL Express Americas global hub at Cincinnati/Northern Kentucky International Airport (CVG) for a five-year term. The company leased the aircraft from DHL and began operations in October 2020.

Cargo Facts reported that Mesa had been using three 737-400Fs.

Additional reporting by Damian Brett

Mesa Airlines stops 737F operations for DHL Express

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