UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

FORM 10-Q

 

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934.

 

For the quarterly period ended June 30, 2003

 

OR

 

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from            to            

 

Commission File No:  0-17895

 

MESABA HOLDINGS, INC.

 

Incorporated under the laws of Minnesota

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ý    No o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).

 

Yes o    No ý

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

Class		Outstanding as of August 4, 2003
Common Stock Par value $.01 per share		20,323,141

 

 

CAUTIONARY STATEMENT UNDER THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

 

Statements in this Quarterly Report on Form 10-Q under the caption “Business” and   “Management’s Discussion and Analysis of  Financial Condition and Results of Operations” as well as oral statements that may be made by the Company or its subsidiaries or by officers, directors or employees of the Company or its subsidiaries acting on the Company’s behalf, that are not historical fact may constitute “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward looking statements involve factors that could cause the actual results of the Company to differ materially from historical results or from any results expressed or implied by such forward-looking statements. The Company cautions the public not to place undue reliance on forward-looking statements, which may be based on assumptions and anticipated events that do not materialize. Factors which could cause the Company’s actual results to differ from forward-looking statements include material changes in the relationship between the Company, its subsidiaries and Northwest Airlines; changes in Northwest Airlines’ air service; reduced passenger and flight activity as a result of severe acute respiratory syndrome (“SARS”) and terrorist events; expenses associated with restructuring operations; a continued slow-down in the overall United States economy; increased operating costs due to heightened security measures; the impact of United States government programs on operations; changes in regulations affecting the airline industry, including those issued by the Department of Transportation (“DOT”), Transportation Security Administration (“TSA”), and Federal Aviation Administration (“FAA”); seasonal factors; labor relations, including labor shortages, slow downs and/or work stoppages; ongoing legal proceedings; and unanticipated costs resulting from the acquisition of Big Sky Transportation Co.

 

2

 

Part I.  FINANCIAL INFORMATION

 

Item 1. CONSOLIDATED FINANCIAL STATEMENTS

 

MESABA HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share information)

(Unaudited)

 

		June 30, 2003			March 31, 2003
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	60,066		$	60,908
Short term investments		58,592			40,464
Accounts receivable, net of reserves of $389 and $389, respectively		35,070			40,682
Inventories, net		9,124			8,459
Prepaid expenses and deposits		5,550			4,925
Deferred income taxes and other		10,738			10,706
Total current assets		179,140			166,144
PROPERTY AND EQUIPMENT:
Flight equipment		80,006			78,549
Other property and equipment		38,900			37,916
Less: Accumulated depreciation and amortization		(76,662		)	(72,667		)
Net property and equipment		42,244			43,798
LONG TERM INVESTMENTS		15,579			21,762
OTHER ASSETS, net		15,067			15,706
		$	252,030		$	247,410

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

3

 

MESABA HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS (Continued)

(In thousands, except share information)

(Unaudited)

 

		June 30, 2003			March 31, 2003
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable		$	12,921		$	15,285
Accrued liabilities:
Payroll		12,966			14,295
Maintenance		16,291			16,031
Deferred income		2,548			2,619
Other, primarily property and income taxes		19,712			14,445
Total current liabilities		64,438			62,675
OTHER NONCURRENT LIABILITIES		6,141			6,790
COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY:
Common stock, $.01 par value; 60,000,000 shares authorized, 20,320,641 shares issued and outstanding		203			203
Paid-in capital		50,615			50,615
Warrants		16,500			16,500
Accumulated other comprehensive income		116			116
Retained earnings		114,017			110,511
Total shareholders’ equity		181,451			177,945
		$	252,030		$	247,410

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

4

 

MESABA HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share information)

(Unaudited)

 

		Three Months Ended June 30,
		2003			2002
OPERATING REVENUES:
Passenger		$	106,762		$	109,030
Freight and other		7,271			4,324
Total operating revenues		114,033			113,354
OPERATING EXPENSES:
Wages and benefits		35,228			31,789
Aircraft fuel		5,717			5,707
Aircraft maintenance		18,380			19,512
Aircraft rents		26,778			26,502
Landing fees		1,765			1,662
Insurance and taxes		2,827			4,325
Depreciation and amortization		4,499			4,863
Administrative and other		14,096			12,767
Total operating expenses		109,290			107,127
Operating income		4,743			6,227
NONOPERATING INCOME (EXPENSE):
Interest income		343			788
Writedown of investment		—			(2,751		)
Other, net		2,636			45
Other nonoperating income (expense), net		2,979			(1,918		)
Income before provision for income taxes		7,722			4,309
PROVISION FOR INCOME TAXES		4,216			2,733
NET INCOME		$	3,506		$	1,576
NET INCOME PER SHARE:
Earnings per common share – basic		$	0.17