MAIR Holdings, parent of Mesaba Airlines and Big Sky Airlines, reported a loss of $82.8 million in a fiscal year ended March 31 that turned on the bankruptcy of its primary subsidiary last fall (ATWOnline, Oct. 14, 2005).

MAIR earned $7.4 million in the prior fiscal year. Mesaba lost $70.7 million in the current 12-month period, including a $45.6 million fourth-quarter net loss driven by $20.2 million in reorganization items, a $6.2 million operating loss and a $29.1 million reserve for unsecured funds owed by Northwest Airlines prior to its own entry into bankruptcy.

"Fiscal 2006 financial results were very disappointing," MAIR President and CEO Paul Foley said. "Northwest Airlines' decision to withhold approximately $30 million in regularly scheduled payments...and its subsequent decision to reduce Mesaba's fleet by more than 50% led to Mesaba's own bankruptcy...and to the company incurring substantial financial losses...In fiscal 2007, we will explore growth opportunities, including acquisitions to diversify both within and outside the airline industry."

MAIR's FY06 operating revenues narrowed 42.1% to $256.3 million and expenses fell 26.5% to $319 million as Mesaba's operation shrank. The parent swung from an $8.6 million operating profit to a $62.7 million operating loss.

Mesaba's traffic dropped 7.1% during the year to 1.86 billion RPMs. Capacity declined 10.1% to 2.76 billion ASMs and load factor rose 2.1 points to 67.5%. Unit revenues climbed 5.7% to 14.8 cents but unit costs rose 20.7% to 16.3 cents per ASM, or 12.6% to 15.2 cents excluding impairment and special charges.

MAIR's fourth-quarter loss was $54.1 million, widened from $1.7 million in the year-ago period. Revenues plunged 95.1% to $5.4 million and expenses dropped 82.5% to $19.9 million. Operating loss grew from $3.2 million to $14.5 million.