Hello, and welcome to the Mesa Airlines Q2 fiscal 2022 earnings conference call. My name is Elan, and I will be moderating today's call. This call is being recorded, and a replay will be available on mesa-air.com in the Investor Relations section. After today's prepared remarks, there will be an opportunity to ask questions. It is now my pleasure to turn the conference over to Susan Donofrio, Head of Investor Relations. Susan, you may begin. Thank you, Elan, and welcome everyone to Mesa's earnings call for its second fiscal quarter ended March 31st. On the call with me today are Jonathan Ornstein, Mesa's Chairman and CEO, Brad Rich, EVP and COO, Michael Lotz, President, and Torque Zubeck, CFO, and other members of the management team. Following our prepared remarks, there will be a question-and-answer session for the sell-side analysts. We also wanted to remind everyone on the call that today's discussion contains forward-looking statements that are based on the company's current expectations and are not a guarantee of future performance. There could be significant risks and uncertainties that cause actual results to differ materially from those reflected by the forward-looking statements, including the risk factors discussed in our reports on file with the SEC. We undertake no duty to update any forward-looking statements. In comparing results today, we will be adjusting all periods to exclude special items. Please refer to our second fiscal quarter earnings release, which is available on our website for the reconciliation of our non-GAAP measures. With that, I will turn it over to Jonathan for his opening remarks. Jonathan? Thank you, Susan, and thank you everyone for joining us today. While not entirely unexpected, this quarter was clearly very disappointing. Brad and Torque will walk through more of the details, but the overarching issue is our current level of pilot attrition, hiring, and training brought about by an industry-wide pilot shortage that has led to our current inability to generate sufficient block hours to operate profitably under our existing agreements. We are addressing this through a number of initiatives, including, but not limited to, increased training capacity, pilot retention, and cost efficiency. Beyond providing valuable regional feed for over two decades, Mesa's position as an independent regional low-cost carrier has provided additional strategic value to both United and American. We believe our partners recognize the value of our relationship and will work with us cooperatively through this challenging environment. Some of you may have heard me saying this before, but the founder of Mesa and my mentor, Larry Risley, once told me that in this industry, something happens every year that happens every 10 years. The last couple of years, it was COVID. This year, it's the pilot shortage and the associated pilot attrition prevalent throughout the regional industry as pilots are recruited away primarily by major carriers and heavy equipment cargo operators. The sheer magnitude of attrition has created significant backlogs in training, further exacerbating an already difficult situation. While we believe our attrition is in line with the rest of the regional industry, we are taking important steps to further attract and retain qualified pilot candidates. We appreciate the support of our airline partners and pilot leadership who are working with us cooperatively to help us as we attempt to successfully navigate through this period. What is most unfortunate is the fact that this shortage is a result of ill-conceived, ill-advised, and politically motivated government regulation that by most independent accounts has absolutely nothing to do with the enhancement of safety. The problem, which will cost consumers millions of dollars in higher fares, has cut off dozens of communities from the national air transportation system and has already reduced service in hundreds more as airlines are unable to fly their aircraft due to lack of pilots. All this could be solved with the stroke of a pen. It's important to note that no other country has adopted these rules, and everyday flights are flown by foreign carriers with pilots who the U.S. would deem to be unqualified. It is a stunning realization that our government has determined that foreign pilots are somehow more qualified than our own U.S. pilots with the same amount of experience and trained in the United States. What has now become apparent is the undue burden this places on minority and other disadvantaged communities, which has been effectively blocked from entering the pilot profession due to the prohibitive costs associated with these regulations. On a more positive note, while COVID-driven absence rates impacted us in January, we ended the quarter with absence rates across the board that have returned to pre-pandemic levels. We appreciate the real bravery of our people over the past two years, and we're thankful we all can come to work in a safe and healthier environment. While both American and United have been supportive, we are disappointed in our inability to produce the block hours requested by our partners as demand has increased. This single issue continues to be the primary focus of our management team. Turning to our DHL cargo operation. In the quarter, we continued to perform well with our two dedicated Boeing 737-400 aircraft. We had a third 737-400 aircraft delivered in March and expected to be entering revenue service for DHL in May. These larger aircraft have the added benefit of attracting regional pilots who have an opportunity to fly larger jet aircraft at the highest rates in the regional industry. While the growth of our cargo business has initially been slower than we anticipated, going forward, we believe that cargo can be an increasingly important part of our business. Our partnership with Gramercy Associates Ltd. is on track, and we expect to have European certification completed in the third quarter of 2022. We own 49% of this Malta-based regional jet operation, and we're looking forward to introducing the regional business model to Europe. One of our most exciting initiatives we have been continuing to pursue selectively is finding new ways to participate, invest, and partner in newer, environmentally friendly technology. These partnerships are designed to position Mesa as the first regional airline to fly electric aircraft and to be at the forefront of decarbonizing air travel and reducing our reliance on fossil fuels. We also think will likely be an answer to providing flight service to smaller communities that now facing the loss of flight service as pilot challenges have resulted in the mainline carriers reducing or eliminating flight service. Another significant benefit is that it could provide Mesa with a future pilot pipeline who can build hours in smaller aircraft not subject to the 1,500-hour rule. Our two electric aviation partnerships with Archer and Heart that we entered into alongside United are reaching production development milestones. Regent, which is developing an all-electric Seaglider, also continues to make progress towards commercialization. Going forward, our strategy is to selectively look at other opportunities in aviation-related green technologies to ensure our leadership role in this area. With that, I will hand it over to Brad to go over more of the details of an update on our operational performance this quarter. Thank you, Jonathan, and good afternoon to everyone. As Jonathan has mentioned, there had been significant challenges due to COVID-19, as well as the transition out of the pandemic, which have been widely discussed and documented. Of course, we have not been immune from these industry-wide issues, and we remain committed and focused on both our fundamental operating performance, as well as implementing creative initiatives to ensure that we are providing safe, high quality, and reliable service for our partners and customers. In the March quarter, we flew 65,613 block hours, an 11.3% decrease from the same quarter last year, and 23.7% below the December 2021 quarter. Our combined controllable completion factor was 96.7% compared to 99.9% a year ago. Both our production and our combined controllable completion factor are below the 2019 levels and have been negatively impacted by the impact of COVID-19, high absence rates, and elevated attrition rates as larger carriers are adding capacity and replacing pilots due to attrition and early retirements. Also, the year-over-year reduction in block hours is partly due to our smaller fleet under contract with American. Based on current trends of attrition and training output, our block hours are expected to be relatively flat for the next two quarters, and due to the volatility of the factors involved, we are not able to give further guidance at this time. Looking ahead to the remainder of fiscal year 2022, we are focused on operating the airline as productively and reliably as possible in the post-pandemic environment. While demand for our flying remains very strong, it is an environment that will be constrained by the supply and training requirements of regional airline pilots. Although our COVID-related sick calls have returned to pre-pandemic levels, our primary challenge remains elevated attrition and the gap created in replacing the departing pilots with new pilots requiring training. The average pilot provides us a two-week notice prior to departure, while the expected training footprint for a new pilot is approximately 90 days. We remain focused on our recruiting efforts, and we have added another full E-Jet simulator that came online in February. We've also secured an additional CRJ simulator that will become operational in July of this year. We strategically positioned these simulators in key locations to decrease our training timelines. As I previously mentioned, our pilot training pipeline is currently not an issue, and we have implemented programs to continue to attract new pilots to Mesa and increase our instructor ranks. Furthermore, we are well-positioned to be an attractive option for pilots through opportunities such as flying all large regional jets and narrow-body 737 aircraft. The United Aviate program, where we're one of few independent regional airlines to be able to offer a direct pathway for our pilots to become a career pilot for United Airlines. The 737 aircraft, we are the only regional airline offering the opportunity to fly larger aircraft and earn the highest pay in the regional industry. We have attractive domiciles which make it easy to commute. We're currently offering rapid captain upgrade opportunities. We have active targeted recruiting efforts, including a cadet program and on-site visits at aviation schools across the country. We have a competitive new hire pay structure with enhanced bonus opportunities. Additionally, we are pursuing other initiatives to attract and retain new pilot candidates. Such as discussions with Part 135 operators that can provide an inflow of pilots to Mesa. We have previously removed all of the CRJ-700s from our operation. We continue the transition process of leasing these 20 aircraft to GoJet Airlines in agreements that end in 2030, and we only have two remaining aircraft that will be delivered this month. Our United E-175 fleet remains at 80 aircraft. The DHL operation performed very well during the March quarter with a controllable completion factor of 99.1%. We took delivery of our third 737-400 cargo aircraft in March, and the aircraft has been in operations as a support aircraft. It will be doing scheduled operations in May. We believe our relationship with our partners remains strong as we continue to have productive conversations regarding future capacity in both short- and long-term strategies. We remain focused on operating our core regional business safely and reliably with the health and safety of our people and our customers always the top priority. With that, I will now turn the time over to Torque, and he will walk through our financial performance. Great. Thank you, Brad. I'll review our financial performance and capital outlook and balance sheet. For the second quarter of the fiscal year of 2022, we reported a net loss of $42.8 million or $1.19 per diluted share compared to a net income of $5.7 million or $0.14 per diluted share for Q2 2021. On an adjusted basis, Mesa reported a pre-tax loss of $13.1 million for Q2 2022 compared to a pre-tax income of $12.1 million for Q2 2021. It's important to note that the adjusted pre-tax loss for Q2 excludes a $39.5 million non-cash impairment charge that is related to the 12 CRJ aircraft which are classified as held for sale, as well as a $2.3 million mark-to-market non-cash losses on our investments in equity securities and the related impact on our income tax expense. The year-over-year decrease of $25.2 million was primarily due to lower block hours and the PSP program funding that has now ended. Revenue in Q2 2022 was $123.2 million, an increase of $25.6 million, up 26.7% from $97.3 million for Q2 2021. Our contract revenue increased by $30.3 million year-over-year as rates return to normal levels after temporary reductions related to the PSP program. This was partially offset by an 11.3% reduction in block hours flown versus the same period last year for our major partners across all fleets. There was also a decrease in pass-through and other revenue of $4.3 million, primarily due to a decrease in pass-through maintenance expense. As a reminder, the pass-through expense has no P&L impact. Mesa's Q2 2022 results include, per GAAP, the recognition of $0.7 million of previously deferred revenue versus the deferral of $4.9 million of revenue in Q2 2021. The remaining deferred revenue balance will be recognized as flights are completed over the remaining terms of the contract. On the expense side, Mesa's overall operating expenses for Q2 2022 were $168 million, up $87.5 million versus Q2 2021. Similar to last quarter, the largest cost variance compared to Q2 2021 is the $66 million in PSP-related grant funding that has now ended. There was also the previously mentioned $39.5 million impairment charge related to our held-for-sale aircraft this quarter. Mesa's flight operations expense was up $5 million versus last year, due primarily to higher training expense. Maintenance expense is now becoming more normalized as we are past the high number of engine overhauls and heavy C checks that were deferred at the beginning of COVID. Maintenance cost was $47.4 million in Q2 2022, down $4.4 million versus Q2 2021. Rotables and expendables and component contracts were up $2.8 million versus last year. Labor costs and others were up $3.5 million versus Q2 2021, mainly reflecting an increase in outside labor support. Compared to Q1 2022, labor costs and other expenses decreased by $2.3 million. Now, next, let me review where we are on cash and liquidity. Cash for the quarter, excluding restricted cash, decreased by $26.4 million to $75.9 million, which is in line with where we were forecasting. During the quarter, we made scheduled debt payments of $28.6 million and had cash lease payments of $6.5 million in excess of bucks. Going forward, our scheduled aircraft lease payments are $12 million lower than this quarter. Total debt at the end of the quarter was $652 million, which is down $26.6 million from the prior quarter. Now while we cannot provide specific financial guidance, we'll provide some color in a few areas. As Brad pointed out, we are going to see quite a bit of pressure in block hours through the rest of the fiscal year, and we expect them to be roughly flat over the next two quarters. As we look at the summer and fall, we will continue to work closely with our partners to maximize block hours with a goal to at least maintain current production, but also take on more as our pilot training throughput increases and pilot attrition stabilizes. Pilot training will remain at elevated levels as we continue to hire and train new pilots. We added SIM capacity for the E-Jets in February, as Brad previously mentioned, and we are looking forward to having additional CRJ SIM capacity coming on in July. Our maintenance costs are now at more normalized levels, which should continue at similar levels going forward over the next few quarters. I'd like to now turn it back over to Jonathan. Thank you, Torque. We appreciate the financial recap. In summary, we believe 2022 will be a transition year for Mesa. We believe this presents an opportunity for us to make some significant and achievable changes in our business structure and fundamentals that will position us well for the future. While we face some significant near-term issues, we believe that by working together with our partners, employees, vendors, and other key stakeholders, we expect to successfully navigate through this period as we've done during other challenging periods in the past. At this point, operator, please open up the call. I'd like to thank everyone in advance, and we appreciate your questions. Thank you. At this time, if you would like to ask a question, please press star one. Please unmute your phone and record your name clearly when prompted. Once again, that is star one if you would like to ask a question. Our first question in the queue today is from Savanthi Syth from Raymond James. Hey, good afternoon, everyone. I was just curious on the pilot front, if you could just provide a little bit more color on is the current situation kind of worse than you kind of were thinking a couple of months ago? Is the kind of recovery as to kind of when you might be able to bring up block hours taking longer, especially in the light of you know, some of the comments that Scott Kirby had on their call about you know, maybe hiring levels in the industry continuing into 2023 at similar levels that you're seeing this year? Well, yeah. Hi, this is Jonathan, Savi, and thank you. You know, the attrition piece obviously is the part that we have least control over. You know, that being said, the majors had in fact given early retirement to you know, I think the total was about 4,000 pilots, which I think, you know, clearly has impacted us. I think we you know, hopefully our view is that we burned through most of that, and there are some things out there that could help, not the least of which is, you know, the extension of age to 67. There's a lot of talk about pilots being able to, you know, be imported, you know, qualified pilots from around the world. You know, the attrition also has been impacted by sort of some of the growth plans of some of the low-cost carriers and whether those will slow down. Clearly that's the first thing. Our attrition has been about where we planned. You know, it had gone up a little bit. It came back down a little bit. You know, this month we think it'll be down a little bit, but it's still at high levels, much higher than, you know, we've seen in the past on a consistent basis. You know, we just don't have the luxury of planning the way the majors do, who can basically sort of look at how many folks are gonna retire, and that kind of becomes the number they need to look at. The part where we can have an impact and, you know, we're working really hard to, is in terms of output. As we mentioned, we do have people in training in the pipeline. We've just had to spool up as fast as we can in terms of additional simulators. We were very fortunate that I think from that standpoint, we now have doubled our capacity or actually more than doubled our capacity. You know, also, we needed to train and qualify more instructors, which, you know, we have done through primarily recruiting internally as well as externally. I think, you know, we ultimately will be successful there so that we can then get the training capacity to outstrip the attrition levels. Clearly with the amount of sim time, we have the ability to do that. We just need to make sure that we execute on that front. You know, again, the attrition level is what is in question here. There are some things that are being talked about in Washington that hopefully will help. You know, I have probably the strongest feelings in the industry about it. You know, this is all being generated by a rule that is totally unnecessary, that's actually creating more velocity, i.e. more turnover, which clearly, that lack of stability in terms of the workforce has to have much, in my opinion, more serious effects than whether or not a person has spent 1,500 hours flying circles around the Pacific Ocean in a Cessna 172. You know, hopefully they will act when they see the impact, which is very apparent in the reduction in capacity across the industry, and the impact it will have on the smaller communities that you know already have been hurt by some of this regulatory burden that has made so much flying unprofitable. There is, you know, basically a fairly common feeling in the industry that the 50-seat aircraft will be, you know, also go the way of the 19-seat and 30-seat aircraft as it just becomes less and less profitable and harder and harder to find pilots to fly those aircraft. You know, it is clearly difficult, but again, I think we have a decent handle on it, and I think, you know, it's gonna take some time to get through it. I think we're trying to be conservative in our estimates going forward, but, you know, we're gonna continue everything we can to get, you know, stabilize the situation. The other piece that I think is important to note is, you know, we've always been a low-cost regional airline, and we've had a fairly strategic value from that respect. We continue to believe we will remain the low-cost carrier. However, I mean, there are some areas, for example, you know, that we think we will solve in relatively short order. For example, you know, we had a pilot contract that was under negotiation. We feel we're very close to getting that done. When I say very close, I'm talking about, you know, weeks, not months. I think that will help, because our rates clearly had become uncompetitive. You know, we've had, in spite of that, reasonably good support, in terms of new hiring. We do that with a significant bonus structure. We've had very, very good support from our pilot leadership, who really sees that it's important for us all to work together right now. I have to tell you, without that, I think, you know, this situation would be twice as difficult for us. That's where we are today. Hopefully, that's a little bit of color that will help. No, that was very thorough. I appreciate all that. If I might ask a quick question on the cargo side. I was curious what the cargo block hours was this quarter. In the past, I know with the monthly, you share that, you didn't have a breakout this time. Just curious what the cargo block hour was and the trend there. I know that's included in the overall color you provided. Look, I mean, this is Mike. The cargo block hours are somewhere between 120 - 140 block hours per month for aircraft. You know, we've got our third aircraft now that goes on flying in May. That's the rough order of magnitude of their block hour production. Appreciate it. Thank you. Thank you. Our next question is from Michael Linenberg from Deutsche Bank. Hi, this is actually Shannon Doherty on for Mike. On the cargo piece, are you guys still targeting eight to 10 cargo airplanes over the next few years? Can you update us on the current dynamics that you're seeing with demand in the logistics market? Thank you. Yeah, we think that cargo over the longer haul is gonna become more and more important to us. You know, the cargo operators themselves are generally fairly conservative in their growth plans. That being said, I think it's fair to say that we did anticipate being, you know, larger than three aircraft by now. I think our discussions with our partner is that, you know, for us to really be a viable entity, and I think they agree, that, you know, over time, we do need to move that number up. I think that you know, with the level of service that we provided last year, you know, DHL told us that, you know, we were among their best, if not their best operator in terms of performance. On the cost side, I think as always, you know, Mesa has proven that we are attractive from a cost basis. Extremely valuable to us, not so much that it really puts a big dent in the numbers right now, but as it grows, it will become more important. It also is a good recruiting tool because we are in a position where, you know, if that number of aircraft grows, it's not an insignificant number of pilots who will have the opportunity to make significantly higher wages that are available at any other regional carrier. You know, we would like to continue to grow it. We think there is opportunity. We certainly have not seen any reduction in terms of hours as if things have slowed down. If nothing else, you know, we think that the capacity requirements are gonna continue to increase at this point. That's really helpful color. My last question is, do you still anticipate to reduce your debt to roughly $490 million by year-end 2023? Can you repeat? It's really hard to hear you. Sorry. Oh, sorry about that. Just on your debt reduction, are you guys still anticipating to reduce your total debt level to about $490 million by year-end 2023, by next year? Yes, we're still on track for that. This is Torque Zubeck. Sorry. Great. Thanks, Torque and team. That's all. Thank you. Our next question is from Helane Becker from Cowen. Thanks very much, operator. Hi, everybody. Thank you for the time. Just a couple of questions. One, on DHL, I don't know whether it was you, Brad, or Jonathan, you said that, I guess, cargo growth was lower than expected. Is that because volumes are not growing as fast as you thought, or because you don't have the aircraft you thought you would have by now? Hello? Hey, sorry, Helane. You know, I think the issue is just that, you know, when United or American orders aircraft, they order them 10, 20 at a time with a 12-year contract. The cargo operators are just, they do not add aircraft like that. They add ones and twos. Plus, you know, I think they wanted to make sure that Mesa was a viable and, you know, a partner that they could rely on, that could provide the level of service. Now, having just finished our first full complete year, I think we have shown that. I do feel that we're in a position that if those opportunities come to fly narrow-body, I think we're very well-positioned to take advantage of that. You know, what that means six months from now or a year, I don't know. I feel that at this point, given the performance level that we've provided and our cost structure, I think we are very well-positioned to take on additional narrow-body flying, when DHL, you know, is in a position to add. You know, we are looking at other options also in the cargo world, I think having an exclusive arrangement with DHL, I think long term could be a very, you know, it might be the best way for us to go. We have a very close tie with DHL. We really enjoy working with them. They have been terrific partners. To be frank, putting our energy into building that relationship would be, I think, a very valuable use of our time. Yeah. Okay. My other questions are related to completion factor and on-time performance. I know in some cases you have to pay penalties if you don't meet your negotiated agreements. Are they suspended since they're taking your pilots? Have you been able to work with them to get them to kind of rethink how they how they- Um- I guess, I don't know, penalize you? Is that the question? No, Helane, that's a very good and very relevant question. Let me answer it like this, and I apologize for, you know, having to sort of be somewhat less than a hundred percent transparent. Clearly, the situation that exists today in the industry is something that is unprecedented. We are working closely with our partners to, you know, have an operation that is the most reliable, most on time, but takes into consideration both what's going on within the industry and the financial impact that it might have on Mesa, which of course, you know, I believe that our partners would prefer to minimize than maximize. I think that all those discussions are ongoing. It's very fortunate that we have good relationships with both of our partners, that they view us as a strategic partner as much as a day-to-day partner. But I think, you know, at this point in time, it's hard to really say where all that shakes out other than I think in the long term, both of our partners would like us to be successful. I think, you know, given the scenario, you know, we're gonna have to be very creative here, in order to ensure that in terms of, you know, what is the right balance between performance and penalties and revenue and costs and everything else, and everything is, you know, open for discussion at this point. Gotcha. Do you think, just as a follow-up to that, Jonathan, There was an article on TV I saw recently. I'm not sure why I thought of that. You were quoted as talking about this comment you made earlier about the 1,500-hour rule and why it was so high. One of the Colgan survivors, I guess, father of somebody really pushed back on that and talked about the fact that there haven't been any accidents in the U.S. and felt it was. He didn't understand why any aviation professional would want anything other than, you know, 1,500 hours. I don't disagree with your comments, right? I mean, we have pilots who fly into the U.S. with 700 or 800 hours, and they do it safely. Do you think that's a realistic goal to get the 1,500-hour rule changed, A? B, do you think the government would allow M&A activity in this sector of the industry in order to help solve that issue? Yeah. I mean, first, let me comment about the 1,500-hour rule. Look, I think that there are other pathways that people can become proficient pilots, highly proficient pilots. You know, military pilots who fly off of aircraft carriers fully armed into combat with less than 200 hours is an example of what that means. You know, with all due respect to all the parties, the fact is there is zero evidence that total time has any impact on safety whatsoever. There is, however, significant evidence that says that the amount of time and type does have an impact. By decreasing the amount of time and type that pilots have because of rapid turnover, I don't think makes a lot of sense, and I think it's antithetical to the interest of safety. Whether or not there'd be M&A, I don't think any M&A at the regional level would be subject to any kind of antitrust issues because we're just too small to count. I don't think that would be a big hurdle. The bigger hurdle is always, you know, our partners generally have rights under, you know, change in control issues. Again, I think that, you know, given the difficult situation and, you know, you know, I think it'd be fair to say that Mesa's not the only carrier that's, you know. Mm-hmm having its difficulties right now in terms of really what's really boiled down to just this pilot issue. I don't think that would be an issue either if there was some creative solutions available. You know, that being said, you know, our biggest issue right now on the pilot side is we can bring people in the door at this point, and I mean, that is a concern, though. It's just the rapidity of attrition, which is being a result of the pilot shortage, that there are. Mm-hmm Fewer available options to a JetBlue or a Spirit or a Atlas. They immediately have to come to us as a source as opposed to in a more plentiful situation, there are other ways to find pilots. You know, I think that you know, I think that we just need to work together. Primarily, you know, I think the big players here will be our partners in order to you know help see us through this. United has been extremely helpful in terms of you know allowing Mesa to participate in the Aviate program. I mean, that clearly has helped us in terms of attrition. I think that you know looking at our contracts ourselves, I think will help us. Overall, I think that, you know, we're just gonna have to be very creative, and it's something that we've done in the past, and I think something we continue to do. Because there are solutions, but I think long term, the solution is just gonna have, you know, refilling the reservoir of pilots that has been drained, as a result of the, you know, the impact of the 1,500-hour rule. That's really helpful, Jonathan. Thank you. Thank you. Our next question is from Andrew Didora from Bank of America. Hey, good afternoon, everyone. Jonathan, based on kind of, you know, what's going on with the operation, you know, think about, you know, the March completion factor when you kind of layer in the current training environment, I know you recently got a new sim, will be getting another new sim. I know attrition is the big wild card, but assuming it stays around where, you know, it has been recently, do you have like a general timeframe of when you think you could be in a position to run at kind of the optimal utilization or kind of the block hour production that you were doing before these pilot issues popped up? Hey, hey, Andrew. This is Brad. Look, I just want to pay a little more attention to the fact that our performance in the quarter was really compromised by the extent of the sick calls when we were in the Omicron variant outbreak. That's really what affected it more than I mean, we had high attrition. That's been ongoing. We've been working with that and planning for it. But it was the sick calls that really got and hurt the performance. As both myself and Jonathan said in the opening remarks, those sick calls and call-out rates have come down to pre-pandemic levels at this point. In terms of timing, you know, I think we cannot snap our fingers and fix this problem just because of the footprint of training. You know, we have added more instructors, which has helped, so that we can fully utilize the sims and, you know, we've added the additional sims. Clearly, I think that you know, we can expand the participation, the Aviate program that we're working on right now. I think there are some things that we can do internally to slow down attrition. I think the biggest issue is just being able to attract and bring people through the system. You know, paying a captain $10 an hour more, and you know, even when we talk to our union leaders about this, you know, I don't think we have a big disagreement, is not what's gonna retain someone if they get a job offer from a major that you know, has obviously a much higher projected income stream over the lifetime of a you know, a pilot's career. I mean, I think that the best thing we can do is just continue to focus on bringing people in the door and getting them trained as fast as we can, which I think is something that you know, we could have done better. I mean, right now, we probably have about 200 people in training. You know, 200 folks, you know, believe me, if we could snap our fingers and those were available tomorrow, we wouldn't have a shortage on line. That's really our focus right now is, just as I said, continuing to bring people in and then getting them through training as fast as possible. To give a little more color on that, we have had a little more success on the CRJ side in terms of getting people through. Our footprint is significantly less, so hopefully we can see some improvement there. That's why we've put a lot of focus now. The first focus on getting additional SIM was on the E-Jet, because we have. That's been where we've been a little bit weaker on the E-Jet, which frankly has also been a churn since COVID because, you know, pre-COVID, we always seem to be a little bit better off in the E-Jet. There has been a fair amount of attrition there, and we now are putting significant amount of focus on the E-Jet side. Understood. Brad, when you spoke about the block hours being flat, the next two quarters, I'm assuming that's flat to the March quarter production, or is that flat year-on-year? Yeah. Flat from last quarter, the March quarter's production. Yeah. Okay. Last one for me. I guess, you know, Torque, the $76 million of cash at the end of the quarter, down from what? $180 million, I think, was the last June cash number. You know, kind of when do you expect to see some stabilization on kind of the burn rate here? And, you know, how should we think about CapEx and principal payments over the next, you know, call it 12-18 months? Thank you. Yeah. Thanks, Andrew. You know, when we look at cash, I mean, we had some large expenses in the quarter, cash expenses in the quarter that we talked about in the comments. That was the bigger driver of the decline in the quarter that we had. You know, right now, as we look ahead to the next quarter, you know, we're expecting to be around $65. The burn isn't gonna be nearly as fast as it was in the prior quarter. Obviously, you know, as we look at the forecast for block hour production, that's the wild card for us right now. Giving direction, you know, further out than that is pretty difficult at this point because, you know, it is really dependent on our production and then obviously, as we work with our partners, what may happen with that. That's sort of that's about what I can provide for you right now. I don't know if there's any other comments. Yeah. The only thing I can add, this is Mike, is that, you know, this current quarter that we reported, we had, and I think it's in the prepared remarks, that we had an extraordinarily high lease payment, which in subsequent quarters will be reduced by about $10 or $11 million per quarter going forward. That is a, you know, something that you would need to take into account. Then the schedule, principal payments, you know, they were. I think they were $29 or $30 million this quarter. They go down by another $10 million next quarter too. Those are the other two factors that might not come out as clearly in the 10-Q as you would expect. Yeah. As far as CapEx is concerned, I mean, one thing we have significant is we have five engines we're taking delivery of. We have the financing set up for those already, and so that's, you know, there would be a little bit of CapEx on those, just the down payments for those. But the majority of that's all gonna be financed. Okay. Makes sense. Thank you. Yep. Thank you. I have another question from Savanthi Syth from Raymond James. Hey, thanks for the follow-up. Just a couple of questions. First one, just wondering on moving the CRJ-900s, the 12 to being held for sale, what was kind of the driver behind that decision? Curious, you know, what interest level you're seeing today for that fleet? Well, I mean, the driver was that, you know, we did not need the aircraft. Like, you know, moving them over, we were able to, you know, it obviously improves our P&L by holding them for sale. We have had multiple parties make offers on the aircraft. You know, they're getting better with time, I will say. They're not going in the wrong direction. You know, we wanna, if we do sell them, and I'm hopeful that we will, that you know, they'll be sold and be used, the proceeds to be used to retire, you know, the government debt that's against those aircraft. You know, I think that, obviously, you can imagine these are not our high time, I mean, our low time engine aircraft. These are the aircraft that are the, you know, I would think it's fair to say the least valuable, but we're still very close to being able to do a transaction that will hopefully, you know, retire all the government debt associated with those aircraft and just sort of start to chip away on that. You know, we do have a couple other transactions in the works that are, you know, would be helpful on the liquidity side. I think that, you know, we are also looking at other ways that we can save money in the company. We're not just gonna sit back and do nothing. We obviously are being very proactive in terms of, you know, working on improving liquidity through other means, although, you know, suffice to say, adding block hours is the fastest and best way for us to do that at this point. That makes sense. Is it fair to assume the European JV is still kind of going forward and this doesn't impact that? No. We're gonna continue to go forward. You know, we think that there's good demand over there. It would be a way. You know, there is no pilot shortage. In fact, you know, believe me, if the government would take action and allow us to, you know, give visas like we can in Australia, a large part of this problem would go away, which, you know, again, is why I say this is politically motivated, not safety motivated. You know, why shouldn't we bring pilots in? I mean, it's kind of ridiculous when you think about it, that if you're a you know, a model, you can get a visa to come work in the United States because there's effectively, quote, "a shortage" where we can't get pilots over, where there's a shortage that has literally billions of dollars of impact on the industry, the communities we serve, and the consumer. I mean, I think it's pretty clear people have seen prices going up, and there's a reason for that, you know? Demand has increased, and supply has decreased. I mean, I'm hopeful that the government will act quickly because that's one thing that could take a lot of pressure off the system if they would just let us tap into the, you know, pilots around the world who are all, you know, exceptionally well qualified. A lot of them fly in more difficult situations than the United States. You know, having been over in Europe, I mean, flying in Europe is clearly more challenging given the weather. I think that, you know, that's one way that we could help solve this problem more quickly. You know, to that end, again, we're being proactive. I'm actually testifying at a hearing next week being held by Senator Sinema regarding the pilot shortage, and I wanna make all these points clear and hope that we can get some of these actions taken. You know, the other thing too is that, you know, in Europe, there is no scope in Europe. There are pilots available, and I think that, you know, the American model of capacity purchase would do very well there. You know, we've seen in Europe, you know, sort of a balkanization of the regional carriers, you know, as opposed to a focused effort that we would try to bring to that operation. Appreciate that. Good luck next week with the testimony testifying. Can I just quickly clarify? With the lease payments, that's just the differential between your, you know, your cash lease payments and your P&L lease payments are different, right? That this does not have an impact on your P&L. Is that fair? Yeah, that's fair. Yeah. Savi, yes. All right. Okay. Thank you. I have another question from Michael Linenberg from Deutsche Bank. Hey, it's Shannon again. Thanks for the follow-up. Were you guys involved in conversation with the FAA last week regarding ATC staffing issues? You know, maybe you were affecting Jacksonville and Austin, maybe you weren't. Just curious to hear your thoughts. Thanks. No, we were not involved. Okay. It didn't impact us, so you know, we were not involved in that. Fair enough. Thank you. What we were interested in with the FAA, and something that we took note of, is the fact that one of our fellow carriers at Republic just filed for an exemption to the 1,500-hour rule, and we're gonna watch that very closely, and we'll probably follow suit. You know, frankly, you know, I applaud the folks at Republic for taking what I think was to be a very meaningful action and making it clear that this rule has really impacted everyone negatively with what would be very clear no upside from a safety perspective and potentially significant downside. At this time, I am showing no further questions. Okay, well, thank you very much everyone for taking the time to hear our quarterly report. As I said at the opening, obviously this is very disappointing. You know, we knew where we stood, so again, it's not a surprise, but we clearly have a lot of work cut out for us in terms of getting the ship back in order. You know, it's frustrating because there is really nothing else that's impacting us negatively. Our maintenance operation has been doing well. Our pilots and flight attendants have been incredibly supportive all through COVID. You know, we see people picking up open time and, you know, doing all the things that we need in this tough period. Our people have been incredibly supportive. It's just hard to compete when, you know, there's so many options for a pilot right now, to earn significantly higher pay at the major carriers, you know, or the air cargo companies or some of the, you know, corporate jet opportunities. It just has become very difficult. We know that, while we can't control attrition, we certainly can do a better job in terms of getting our people through training, which is something we're highly focused on doing. I think lastly, and most importantly, is, you know, I think the support that we're getting from our partners has been outstanding, and, I wanna tell you how much I appreciate that because, I think in the long run, their support will be critical, for us to get through this problem successfully. With that, we hope we'll have a better report for you next quarter. Obviously, this has been disappointing. You know, we're all shareholders and we know where the stock is, and we know what our job is here. I can assure you we're all taking that very seriously. Thank you very much, and we look forward to talking to you next quarter. Thank you. This does conclude today's conference. You may disconnect at this time.