The public relations people at Mesa Air Group probably cringe each time CEO Jonathan Ornstein makes ad lib comments during earnings conference calls with analysts.

Transcripts of a conference call last week quoted Ornstein as saying:

“So, we’re sort of doing that analysis to determine the viability of go! going forward, and at this point we still feel confident that with any help from fuel primarily, I think we’re in recently reducing shape,” said Ornstein. (See)

After kicking off an interisland fare wars that slashed fares by half while losing millions of dollars in the process, is Mesa thinking of pulling out of the market?

It wouldn’t surprise most analysts if the company were to do so given the high fuel prices, the $52.5 million settlement payment to Hawaiian Airlines and the potential loss of a $20 million-a-month contract with Delta Air Lines.

Already, the company is selling its 49 percent stake in China’s Kunpeng regional airline to raise cash.

I called Ornstein on Thursday to elaborate on his comments.
Ornstein said there’s no plan to pull out of Hawaii and that he remains committed long-term to the market.

Ornstein said the ideas that he was trying to get across didn’t come across clearly in the transcripts.

He said the context shows that he was talking about how go!’s $7.4 million loss during its most recent quarter was saddled by what he could consider one-time costs. They included more than $1 million in legal expenses and $200,000 in corporate overhead.

If you exclude some of those costs and factor in lower fuel prices, the numbers look better, he said.

This isn’t the first time, Ornstein’s off-the-cuff remarks put him on the spot.
During a January 2006 conference call with Wall Street analysts, he boasted that go! would be profitable because he had the “benefit of looking at Aloha and Hawaiian during their respective bankruptcies.”

Both Hawaiian and Aloha Airlines seized on those remarks in separate lawsuits they filed against Mesa, which alleged Mesa improperly used confidential business data it received when the local carriers were under bankruptcy protection.

It cost Mesa $52.5 million to settle with Hawaiian. It may cost more to resolve Aloha’s lawsuit now that the state’s former number 2 carrier is out of business.

Tags: Airlines, go!, Ornstein

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