04-09-2008, 07:18 AM
For those who have not been following this venture because of the issues with Aloha and ATA, here's the latest.
Mesa is asking it's stockholders to authorize the issuance of more stock to raise money because of mounting debt. In order to make this request, they had to detail the financial situation of the company. As part of the detailing, they had to break out each operation for the stockholders to see. As it relates to Hawaii, the news was not good.
Go airlines lost over $20,000,000.00 subsidizing fares since it started. This does not include the initial debt incurred for the startup. Based on this, Go will need to raise all fares soon just to stem incurring even higher debt above current levels. If the stockholders require Mesa to just break even in cost versus fares, fares could triple. If the stockholders require full self sufficiency by Go, who knows what fares will be.
Mesa also is facing a serious problem since as of close today, their stock is below $1 a share. So even the amount of stock they are asking to issue may be only half the value when it's issued. That is having stockholders calling for Mesa to stop the financial bleeding of Go airlines or cease Hawaii operations.
Here’s’ a sample of what stockholders are being told by other stockholders.
“therefore, I am asking each of you to think carefully about issuing more stock at a time when this company is throwing money away. If Mesa can’t bring its Hawaii operation (Go Airlines) into the black, they need to pack up and pull out. Hawaii is not an EAS program so it must pay for itself.”
Mesa is asking it's stockholders to authorize the issuance of more stock to raise money because of mounting debt. In order to make this request, they had to detail the financial situation of the company. As part of the detailing, they had to break out each operation for the stockholders to see. As it relates to Hawaii, the news was not good.
Go airlines lost over $20,000,000.00 subsidizing fares since it started. This does not include the initial debt incurred for the startup. Based on this, Go will need to raise all fares soon just to stem incurring even higher debt above current levels. If the stockholders require Mesa to just break even in cost versus fares, fares could triple. If the stockholders require full self sufficiency by Go, who knows what fares will be.
Mesa also is facing a serious problem since as of close today, their stock is below $1 a share. So even the amount of stock they are asking to issue may be only half the value when it's issued. That is having stockholders calling for Mesa to stop the financial bleeding of Go airlines or cease Hawaii operations.
Here’s’ a sample of what stockholders are being told by other stockholders.
“therefore, I am asking each of you to think carefully about issuing more stock at a time when this company is throwing money away. If Mesa can’t bring its Hawaii operation (Go Airlines) into the black, they need to pack up and pull out. Hawaii is not an EAS program so it must pay for itself.”