BRISTOW GROUP INC HOUSTON, Feb. 8, 2016 /PRNewswire/ -- Bristow Group Inc. (NYSE: BRS) today reported the following results for the quarter ended December 31, 2015:
-- Operating revenue of $395.2 million
-- Net income of $3.2 million (GAAP) and $23.5 million (adjusted)
-- Diluted earnings per share of $0.09 (GAAP) and $0.67 (adjusted)
-- Adjusted EBITDAR of $116.9 million; margin of 29.6%
The Company is reaffirming its adjusted earnings per share guidance for the full fiscal year 2016 of $1.80 - $2.40. GAAP and adjusted results for our 2016 fiscal third quarter were net of charges for bad debt expense of $2.7 million ($2.3 million after-tax and $0.07 per share) and a $1.4 million benefit from changes in foreign currency exchange rates ($1.2 million after-tax and $0.03 per share), which compares to a negative impact from foreign exchange of $15.2 million in the December 2014 quarter ($12.1 million after-tax and $0.34 per share). Adjusted results for the three months ended December 31, 2015 (Q3 FY16) and 2014 (Q3 FY15) are also presented net of loss on disposal of assets and special items as follows:
($ in Diluted Adjusted
thousands Earnings Per EBITDAR
except per Share
share
amounts) Operating Revenue Net Income
----------------- ---------- ------------- ---------
Q3 FY16 As
Reported
(GAAP) $395,157 $3,202 $0.09 n/a
Loss on
disposal of
assets 1,658 0.05
Special items 18,673 0.53
------
Q3 FY16 As
Adjusted
(non-GAAP)
(1) n/a 23,533 0.67 116,907
Q3 FY15 As
Reported
(GAAP) 430,318 (968) (0.03) n/a
Loss on
disposal of
assets 21,033 0.60
Special items 4,654 0.13
-----
Q3 FY15 As
Adjusted
(non-GAAP)
(1) n/a 24,719 0.70 109,056
Percentage
Change Y/Y
(GAAP) (8)% * * n/a
Percentage
Change Y/Y
(non-GAAP) n/a (5)% (4)% 7%
_________
(1) See a full reconciliation of non-
GAAP financial measurements at the
end of this news release.
* percentage change not meaningful
"Our third quarter results demonstrate the success of our diversified business development and economic restructuring efforts in the face of unprecedented challenges for our oil and gas clients. These initiatives demonstrably improved our third quarter margins while improving our competitive position and financial flexibility," said Jonathan Baliff, President and Chief Executive Officer of Bristow Group.
"In oil and gas operations, and in light of recent aircraft accidents in Nigeria, Bristow remains committed to achieving Target Zero. We are proud of our culture of safety, but these recent accidents have been humbling and have strengthened our resolve."
"Also on the operating front, U.K. Search & Rescue ("SAR") startup is largely complete with nine out of ten bases now operational, strengthening our relationship with the U.K. Government as Bristow delivers a step change in SAR capability for its citizens."
"The decline in oil prices is likely to further impact our clients' capital spending in fiscal 2017. As a result, cash generation and financial flexibility will remain our top financial priorities during this downturn. In this challenging environment, the reduction in our dividend combined with previously announced cost reductions, capital expenditure deferrals and $200 million term loan, are intended to provide us with the critical cash and financial flexibility necessary."
Mr. Baliff continued, "But the financial flexibility we create also allows for a deeper transformation of our business designed to improve safety, expand client relationships, and deliver best-in-class service."
"We need to position Bristow for select opportunities to serve clients better, in downturns or upturns. Our recent investment is Sky-Futures, a leading global Unmanned Aerial Vehicle ("UAV") operator, continues Bristow's historical commitment to new and growing applications in oil and gas while expanding into non-energy markets."
THIRD QUARTER FY 2016 CONSOLIDATED RESULTS
Operating Revenue
Our operating revenue for the December 2015 quarter was impacted by reduced activity and revenue from our oil and gas clients resulting from the ongoing cyclical downturn driven by low crude oil prices globally. Operating revenue from oil and gas clients declined $81.2 million, or 21.2%, from the same quarter in fiscal year 2015. Despite challenging industry conditions, our diversification results with U.K. SAR and fixed-wing operations partially offset lower oil and gas revenue as follows:
-- Operating revenue from SAR operations increased by $35.7 million, or
301.5%, in the December 2015 quarter as a result of the start-up of the
U.K. SAR contract in April 2015, which is reflected in the results of
our Europe Caspian Region, and
-- Operating revenue from our fixed-wing operations increased by $10.4
million, or 29.7%, in the December 2015 quarter primarily due to the
addition of Airnorth in Australia, which is reflected in the results of
our Asia Pacific Region.
Changes in foreign currency exchange rates reduced gross revenue by $14.9 million in the December 2015 quarter, compared with rates in the prior year quarter.
Reported (GAAP) Net Income and Diluted Earnings per Share
Net income and diluted earnings per share increased by $4.2 million and $0.12, respectively, for the December 2015 quarter primarily due to:
-- A benefit from changes in foreign currency exchange rates of $1.2
million in the December 2015 quarter compared with a decrease of $12.1
million in the comparable December 2014 quarter, primarily reflected in
a $8.1 million increase in earnings from our investment in Líder in
Brazil,
-- A loss of $1.7 million on disposal of assets in the December 2015
quarter compared with a $21.0 million loss in the December 2014 quarter
as the prior year quarter included non-cash impairment charges for
aircraft of $20.5 million, and
-- A reduction in costs across our global organization in the December 2015
quarter, reflected primarily in decreased general and administrative,
salaries and benefits, and maintenance expense driven by cost reduction
efforts in the face of the ongoing downturn in the oil and gas industry.
These items were partially offset by
-- The impact of a decrease in operating revenue in the December 2015
quarter primarily resulting from the oil and gas downturn,
-- Charges for bad debt expense of $2.3 million related to clients in our
Africa and Asia Pacific regions in the December 2015 quarter,
-- Severance expense of $5.4 million and accelerated depreciation expense
of $3.8 million in the December 2015 quarter, and
-- Non-cash valuation allowances on deferred tax assets of $9.5 million
recorded in the December 2015 quarter.
Adjusted Results
Adjusted EBITDAR for the December 2015 quarter increased by $7.9 million over the December 2014 quarter primarily due to:
-- Further diversification of our business through the start-up of the U.K.
SAR contract and acquisition of Airnorth fixed-wing operations,
-- Global cost reduction efforts, and
-- A benefit from changes in foreign currency exchange rates of $1.4
million in the December 2015 quarter compared with a decrease of $15.7
million in the December 2014 quarter, primarily reflected in our
earnings pickup in Brazil in both periods.
These items were partially offset by the operating revenue decrease for our oil and gas operations falling to the bottom line and $2.7 million in bad debt expense as discussed above.
Despite the improvement in adjusted EBITDAR, adjusted net income and diluted earnings per share decreased by $1.2 million and $0.03, respectively, from the December 2014 quarter as rent, interest and income tax costs increased year-over-year. Changes in foreign currency exchange rates increased adjusted net income by $1.2 million ($0.03 per diluted share) in the December 2015 quarter compared with a decrease of $12.1 million ($0.34 per diluted share) in the December 2014 quarter, primarily reflected in our equity earnings pickup in Brazil in both quarters.
Adjusted EBITDAR excludes losses on disposal of assets and special items, including severance expense recorded in the December 2015 quarter. Adjusted net income and adjusted diluted earnings per share for the December 2015 quarter excludes those same items as well as the accelerated depreciation expense and the valuation allowance on deferred tax assets. See a description of these special items and the special items impacting the December 2014 quarter later in this document.
THIRD QUARTER FY 2016 REGION RESULTS
Europe Caspian Region
Operating revenue for the December 2015 quarter reflects the impact from the downturn in the oil and gas industry, which has resulted in decreased activity levels with our oil and gas clients. Additionally, a substantial portion of our revenue in the Europe Caspian region is contracted in British pounds and Norwegian kroner, both of which weakened significantly against the U.S. dollar since the December 2014 quarter. Foreign currency exchange rate changes resulted in an $8.7 million reduction in revenue for our Europe Caspian region year-over-year. Partially offsetting the year-over-year decrease in operating revenue was the startup of two U.K. SAR bases in April 2015, one base in July 2015, one base in August 2015 and one base in October 2015, which contributed $35.7 million in additional operating revenue, and the addition of a new oil and gas contract that commenced in late fiscal year 2015 and contributed $13.7 million in operating revenue in the December 2015 quarter.
Operating income and operating margin were impacted by the decline in revenue, partially offset by a decline in fuel expense of $4.1 million and maintenance expense of $1.3 million as part of cost reduction initiatives. Additionally, we added two leased aircraft in our Europe Caspian region over the prior year quarter, primarily in support of the U.K. SAR contract, which resulted in a $3.2 million increase in rent expense. The increase in rent expense was the primary driver of the $1.6 million year-over-year decrease in operating income and operating margin decrease to 14.0% in the December 2015 quarter from 14.6% in the December 2014 quarter.
Adjusted EBITDAR increased in the December 2015 quarter and includes the positive impact from changes in foreign currency exchange rates of $1.0 million compared to the prior year quarter. Given the impact on revenue in addition to adjusted EBITDAR, the changes in foreign currency exchange rates had minimal impact on adjusted EBITDAR margin. Adjusted EBITDAR margin improved year-over-year with the start-up of U.K. SAR bases and cost reduction activities, partially offset by the impact from the downturn in the oil and gas industry.
Africa Region
Operating revenue for the Africa region decreased due to an overall reduction in activity compared to the prior year quarter. Activity declined with some customers and certain contracts ended, reducing revenue by $27.0 million, which was partially offset by a $2.5 million increase in activity from other contracts.
Operating income decreased by $22.0 million compared to the prior year quarter, with a decrease in operating margin from 30.6% to 7.1% year-over-year. This decrease resulted from the decrease in activity, bad debt expense of $1.7 million during the December 2015 quarter and an increase in depreciation and amortization expense of $5.0 million resulting from management's decision to exit certain aircraft model types from our fleet sooner than originally anticipated.
Adjusted EBITDAR and adjusted EBITDAR margin declined primarily due to the decrease in activity and bad debt expense of $1.7 million in the December 2015 quarter which was only partially offset by a decrease in direct costs of $7.9 million, including salaries and benefits expense, maintenance expense and training costs.
Americas Region
Operating revenue for the Americas region decreased in the December 2015 quarter primarily due to a decline in the number of small and medium aircraft on contract and reduction in flight hours for large aircraft in the U.S. Gulf of Mexico, which reduced operating revenue by $15.9 million, and a decrease of $1.7 million from Brazil due to fewer aircraft leased to Líder.
Operating income, operating margin, adjusted EBITDAR and adjusted EBITDAR margin were positively impacted by an increase of $9.4 million in earnings from our investment in Líder in Brazil compared to the prior year quarter. Earnings from our investment in Líder increased by $1.0 million and reduced by $7.7 million in the December 2015 and 2014 quarters, respectively, as a result of foreign currency exchange rate changes. Excluding this impact, our adjusted EBITDAR for the Americas region would have been $35.0 million (48.5% margin) and $40.9 million (46.4% margin), respectively, in the December 2015 and 2014 quarters. Results for our Americas Region also benefited from a reduction in direct costs and general and administrative expenses of $12.2 million primarily from a decrease in maintenance expense, salaries and benefits, fuel, lease and freight costs.
Asia Pacific Region
In January 2015, Bristow Australia acquired an 85% interest in Airnorth and in November 2015, purchased the remaining 15% of the outstanding shares of Airnorth which contributed $17.9 million in operating revenue and $5.2 million in adjusted EBITDAR for the December 2015 quarter. Operating revenue also increased by $8.5 million from new contracts in Australia, including the INPEX contract which started in the June 2014 quarter, offset by $10.5 million less revenue due to the ending of short-term contracts in Australia. A substantial portion of our operations in the Asia Pacific region are contracted in the Australian dollar, which weakened significantly against the U.S. dollar compared to the same quarter a year ago. Foreign currency exchange rate changes resulted in a reduction in revenue for our Asia Pacific region of $4.4 million year-over-year.
Operating income, operating margin and adjusted EBITDAR increased primarily as a result of the acquisition of Airnorth, partially offset by bad debt expense of $1.0 million recorded during the December 2015 quarter. Adjusted EBITDAR and adjusted EBITDAR margin were positively impacted by changes in foreign currency exchange rates, which increased adjusted EBITDAR by $4.9 million compared to the prior year quarter. Excluding the impact of the foreign currency rate changes, adjusted EBITDAR margin would have been 21.6% and 26.8%, respectively, in the December 2015 and 2014 quarters.
NINE MONTHS FY 2016 RESULTS
---------------------------
($ in Diluted Earnings Adjusted
thousands Per Share EBITDAR
except per
share
amounts) Operating Revenue Net Income
----------------- ---------- ---------------- ---------
YTD FY16 As
Reported
(GAAP) $1,254,279 $(47,187) $(1.40) n/a
Loss on
disposal of
assets 18,369 0.52
Special items 76,014 2.20
------
YTD FY16 As
Adjusted
(non-GAAP)
(1) n/a 47,196 1.34 330,718
YTD FY15 As
Reported
(GAAP) 1,308,111 69,223 1.94 n/a
Loss on
disposal of
assets 20,441 0.57
Special items 12,495 0.35
YTD FY15 As
Adjusted
(non-GAAP)
(1) n/a 102,159 2.87 347,494
Percentage
Change Y/Y
(GAAP) (4)% (168)% (172)% n/a
Percentage
Change Y/Y
(non-GAAP) n/a (54)% (53)% (5)%
_________
(1) See a full reconciliation of non-
GAAP financial measurements at the
end of this news release.
Operating revenue for the nine months ended December 31, 2015 decreased 4.1% primarily due to:
-- Reduced activity and revenue from our oil and gas clients resulting from
the ongoing downturn driven by low crude oil prices globally, which
reduced operating revenue by $172.1 million, or 14.9%, partially offset
by
-- An increase in operating revenue from U.K. SAR operations of $77.2
million, or 203.7%, resulting from the start-up of the contract in April
2015, which is reflected in the results of our Europe Caspian Region,
and
-- An increase in operating revenue from fixed-wing operations of $41.0
million, or 35.9%, primarily from the addition of Airnorth in Australia,
which is reflected in the results of our Asia Pacific Region.
Changes in foreign currency exchange rates reduced gross revenue by $83.9 million, compared with rates in the prior year period.
GAAP net loss was $116.4 million lower than the prior year period and diluted earnings per share was $3.34 lower primarily as a result of:
-- A loss on disposal of assets of $18.4 million (primarily consisting of
impairment charges on aircraft of $16.9 million),
-- Accelerated depreciation expense of $15.5 million related to changes in
the planned timing of exit and market value of certain aircraft model
types from our fleet and $3.8 million of impairment charges on
inventory,
-- An impairment of goodwill of $25.0 million (included in loss on
impairment) related to our Bristow Norway reporting unit within our
Europe Caspian region ($13.5 million) and Bristow Academy reporting unit
within Corporate and other ($11.5 million),
-- Severance expense of $16.8 million related to separation programs across
our global organization designed to reduce costs and increase
efficiency,
-- Non-cash valuation allowances on deferred tax assets of $15.0 million,
and
-- The decrease in operating revenue primarily driven by the oil and gas
downturn.
Adjusted EBITDAR decreased 4.8% from the prior year period primarily related to reduced oil and gas revenue, partially offset by the benefits of U.K. SAR and fixed-wing revenue and cost reduction activities across the organization. Adjusted net income and adjusted diluted earnings per share were further impacted by increased rent expense of $38.0 million in the current year period.
LIQUIDITY AND CASH FLOW
Cash as of December 31, 2015 totaled $131.9 million compared to $104.1 million as of March 31, 2015. Our total liquidity, including cash on hand and availability on our revolving credit facility, was $299.3 million as of December 31, 2015 compared to $369.9 million as of March 31, 2015. We completed a $200 million two-year term loan facility in November 2015 which was primarily used for capital expenditures for aircraft of $165 million in the December 2015 quarter. Also, during the December 2015 quarter, we were able to defer new aircraft deliveries and related capital expenditures to better match anticipated client demand with the cash outlay for such aircraft.
"Our cost reductions and restructuring actions over the past 12 months are mitigating the impact of this very challenging business environment; and our diversification strategy is working as we anticipate that U.K. SAR and our fixed-wing business should represent over 25% of next fiscal year's operating revenue," said L. Don Miller, Senior Vice President and Chief Financial Officer of Bristow Group.
"But, the oil and gas downturn is deeper and lasting longer than originally expected. Our commercial outlook for fiscal 2017 remains challenging and our access to almost $300 million of liquidity is critical to our prudent balance sheet management strategy. Our reduction in the quarterly dividend combined with capital reductions and deferrals are all designed to allow us to achieve free cash flow neutrality for the year."
GUIDANCE
We are reaffirming our adjusted diluted earnings per share guidance for the full fiscal year 2016 of $1.80 to $2.40.
As a reminder, our adjusted diluted earnings per share guidance excludes the effect of special items and asset dispositions because their timing and amounts are more variable and less predictable. Further, this guidance is based on foreign exchange rates as of December 31, 2015 and assumes the rates will remain unchanged from these levels. In providing this guidance, we have not included the impact of any changes in accounting standards or significant acquisitions and divestitures. Events or other circumstances that we do not currently anticipate or cannot predict, including changes in the market and industry and the impact of the temporary suspension of our operations of S-76C model medium aircraft in Nigeria, could result in earnings per share for fiscal year 2016 that are significantly above or below this guidance. Factors that could cause such changes are described below under the Forward-Looking Statements Disclosure and the Risk Factors in our quarterly report on Form 10-Q for the quarter ended December 31, 2015 and annual report on Form 10-K for the fiscal year ended March 31, 2015.
DIVIDEND
On February 4, 2016, our Board of Directors approved a dividend of $0.07 per share to be paid on March 15, 2016 to shareholders of record on March 1, 2016. Based on shares outstanding as of December 31, 2015, the total quarterly dividend payment will be approximately $2.4 million.
CONFERENCE CALL
Management will conduct a conference call starting at 10:00 a.m. ET (9:00 a.m. CT) on Tuesday, February 9, 2016 to review financial results for the fiscal year 2016 third quarter ended December 31, 2015. This release and the most recent investor slide presentation are available in the investor relations area of our web page at www.bristowgroup.com. The conference call can be accessed as follows:
Via Webcast:
-- Visit Bristow Group's investor relations Web page at
www.bristowgroup.com
-- Live: Click on the link for "Bristow Group Fiscal 2016 Third Quarter
Earnings Conference Call"
-- Replay: A replay via webcast will be available approximately one hour
after the call's completion and will be accessible for approximately 90
days
Via Telephone within the U.S.:
-- Live: Dial toll free 1-877-404-9648
-- Replay: A telephone replay will be available through February 23, 2016
and may be accessed by calling toll free 1-877-660-6853, passcode:
13627904#
Via Telephone outside the U.S.:
-- Live: Dial 1-412-902-0030
-- Replay: A telephone replay will be available through February 23, 2016
and may be accessed by calling 1-201-612-7415, passcode: 13627904#
ABOUT BRISTOW GROUP INC.
Bristow Group Inc. is the leading provider of helicopter services to the worldwide offshore energy industry based on the number of aircraft operated and one of two helicopter service providers to the offshore energy industry with global operations. The Company has major transportation operations in the North Sea, Nigeria and the U.S. Gulf of Mexico, and in most of the other major offshore oil and gas producing regions of the world, including Australia, Brazil, Canada, Russia and Trinidad. For more information, visit the Company's website at www.bristowgroup.com.
FORWARD-LOOKING STATEMENTS DISCLOSURE
Statements contained in this news release that state the Company's or management's intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements. These forward-looking statements include statements regarding earnings guidance, expected contract revenue, capital deployment strategy, operational and capital performance, expected cost management activities, expected capital expenditure deferrals, shareholder return, liquidity, market and industry conditions. It is important to note that the Company's actual results could differ materially from those projected in such forward-looking statements. Risks and uncertainties include without limitation: fluctuations in the demand for our services; fluctuations in worldwide prices of and supply and demand for oil and natural gas; fluctuations in levels of oil and natural gas production, exploration and development activities; the impact of competition; actions by clients and suppliers; the risk of reductions in spending on helicopter services by governmental agencies; changes in tax and other laws and regulations; changes in foreign exchange rates and controls; risks associated with international operations; operating risks inherent in our business, including the possibility of declining safety performance; general economic conditions including the capital and credit markets; our ability to obtain financing; the risk of grounding of segments of our fleet for extended periods of time or indefinitely; our ability to re-deploy our aircraft to regions with greater demand; our ability to acquire additional aircraft and dispose of older aircraft through sales into the aftermarket; the possibility that we do not achieve the anticipated benefit of our fleet investment program; availability of employees; and political instability, war or acts of terrorism in any of the countries where we operate. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company's SEC filings, including but not limited to the Company's quarterly report on Form 10-Q for the quarter ended December 31, 2015 and annual report on Form 10-K for the fiscal year ended March 31, 2015. Bristow Group Inc. disclaims any intention or obligation to revise any forward-looking statements, including financial estimates, whether as a result of new information, future events or otherwise.
Linda McNeill
Investor Relations
(713) 267-7622
(financial tables follow)
BRISTOW GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts and percentages)
(Unaudited)
Three Months Ended Nine Months Ended
December 31, December 31,
------------ ------------
2015 2014 2015 2014
---- ---- ---- ----
Gross revenue:
Operating revenue from non-
affiliates $374,979 $408,388 $1,193,002 $1,242,462
Operating revenue from
affiliates 20,178 21,930 61,277 65,649
Reimbursable revenue from
non-affiliates 24,730 29,822 79,515 100,203
419,887 460,140 1,333,794 1,408,314
Operating expense:
Direct cost 288,135 295,425 926,378 891,483
Reimbursable expense 23,380 28,549 76,242 94,466
Depreciation and amortization 32,320 23,625 106,853 77,164
General and administrative 59,513 72,531 174,302 194,687
------ ------ ------- -------
403,348 420,130 1,283,775 1,257,800
Loss on impairment - (3,805) (27,713) (7,167)
Loss on disposal of assets (2,154) (26,331) (23,856) (25,594)
Earnings from unconsolidated
affiliates, net of losses 7,692 (958) (1,372) 419
----- ---- ------ ---
Operating income (loss) 22,077 8,916 (2,922) 118,172
Interest expense, net (9,536) (6,976) (24,384) (21,675)
Gain on sale of
unconsolidated affiliate - 3,921 - 3,921
Other income (expense), net 650 (5,223) (6,935) (9,143)
--- ------ ------ ------
Income (loss) before
provision for income taxes 13,191 638 (34,241) 91,275
Provision for income taxes (9,623) (567) (9,500) (18,376)
------ ---- ------ -------
Net income (loss) 3,568 71 (43,741) 72,899
Net income attributable to
noncontrolling interests (366) (1,039) (3,446) (3,676)
Net income (loss)
attributable to Bristow
Group 3,202 (968) (47,187) 69,223
Accretion of redeemable
noncontrolling interest - - (1,498) -
--- --- ------ ---
Net income (loss)
attributable to common
stockholders $3,202 $(968) $(48,685) $69,223
====== ===== ======== =======
Earnings (loss) per common share:
Basic $0.09 $(0.03) $(1.40) $1.96
Diluted $0.09 $(0.03) $(1.40) $1.94
Non-GAAP measures:
Adjusted operating income $36,622 $43,564 $92,132 $161,303
Adjusted operating margin 9.3% 10.1% 7.3% 12.3%
Adjusted EBITDAR $116,907 $109,056 $330,718 $347,494
Adjusted EBITDAR margin 29.6% 25.3% 26.4% 26.6%
Adjusted net income $23,533 $24,719 $47,196 $102,159
Adjusted diluted earnings per
share $0.67 $0.70 $1.34 $2.87
BRISTOW GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
December 31, March 31,
2015 2015
---- ----
ASSETS
Current assets:
Cash and cash equivalents $131,908 $104,146
Accounts receivable from non-
affiliates 225,665 250,610
Accounts receivable from affiliates 6,110 8,008
Inventories 146,590 147,169
Assets held for sale 52,916 57,827
Prepaid expenses and other current
assets 48,691 70,091
------ ------
Total current assets 611,880 637,851
Investment in unconsolidated
affiliates 203,983 216,376
Property and equipment - at cost:
Land and buildings 246,667 171,959
Aircraft and equipment 2,589,856 2,493,869
--------- ---------
2,836,523 2,665,828
Less - Accumulated depreciation and
amortization (521,627) (508,727)
-------- --------
2,314,896 2,157,101
Goodwill 52,530 75,628
Other assets 168,800 143,764
------- -------
Total assets $3,352,089 $3,230,720
========== ==========
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND STOCKHOLDERS' INVESTMENT
Current liabilities:
Accounts payable $79,951 $84,193
Accrued wages, benefits and related
taxes 61,489 81,648
Income taxes payable 18,825 7,926
Other accrued taxes 8,805 13,335
Deferred revenue 26,259 36,784
Accrued maintenance and repairs 24,734 23,316
Accrued interest 5,574 12,831
Other accrued liabilities 47,686 48,667
Deferred taxes 14,302 17,704
Short-term borrowings and current
maturities of long-term debt 47,243 18,730
Contingent consideration 29,021 33,938
Deferred sale leaseback advance - 55,934
--- ------
Total current liabilities 363,889 435,006
Long-term debt, less current
maturities 1,175,760 845,692
Accrued pension liabilities 82,620 99,576
Other liabilities and deferred credits 33,151 39,782
Deferred taxes 131,899 165,655
Redeemable noncontrolling interests 24,874 26,223
Stockholders' investment:
Common stock 377 376
Additional paid-in capital 794,676 781,837
Retained earnings 1,199,977 1,284,442
Accumulated other comprehensive loss (278,344) (270,329)
Treasury shares (184,796) (184,796)
-------- --------
Total Bristow Group stockholders'
investment 1,531,890 1,611,530
Noncontrolling interests 8,006 7,256
----- -----
Total stockholders' investment 1,539,896 1,618,786
--------- ---------
Total liabilities, redeemable non
controlling interests and
stockholders' investment $3,352,089 $3,230,720
========== ==========
BRISTOW GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Nine Months Ended
December 31,
2015 2014
---- ----
Cash flows from operating activities:
Net income (loss) $(43,741) $72,899
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 106,853 77,164
Deferred income taxes (37,628) (7,875)
Write-off of deferred financing fees - 660
Discount amortization on long-term
debt 973 3,212
Loss on disposal of assets 23,856 25,594
Gain on sale of unconsolidated
affiliate - (3,921)
Loss on impairment 27,713 7,167
Stock-based compensation 16,641 13,651
Equity in earnings from
unconsolidated affiliates less than
dividends received 2,227 4,196
Tax benefit related to stock-based
compensation (44) (1,642)
Increase (decrease) in cash resulting
from changes in:
Accounts receivable 31,858 (11,350)
Inventories (5,555) (15,578)
Prepaid expenses and other assets (2,645) (13,354)
Accounts payable (2,527) 19,353
Accrued liabilities (46,289) 4,547
Other liabilities and deferred
credits (16,008) (12,313)
------- -------
Net cash provided by operating
activities 55,684 162,410
Cash flows from investing activities:
Capital expenditures (343,365) (499,285)
Proceeds from asset dispositions 19,152 404,361
Proceeds from sale of unconsolidated
affiliate - 4,185
Net cash used in investing activities (324,213) (90,739)
Cash flows from financing activities:
Proceeds from borrowings 910,421 347,860
Repayment of debt (567,121) (373,169)
Partial prepayment of put/call
obligation (42) (46)
Acquisition of noncontrolling
interest (7,311) (3,170)
Dividends paid to noncontrolling
interest (153) -
Payment of contingent consideration (8,000) -
Repurchase of common stock - (80,831)
Common stock dividends paid (35,627) (33,935)
Issuance of common stock - 2,217
Tax benefit related to stock-based
compensation 44 1,642
--- -----
Net cash provided by (used in)
financing activities 292,211 (139,432)
Effect of exchange rate changes on
cash and cash equivalents 4,080 (15,214)
----- -------
Net increase (decrease) in cash and
cash equivalents 27,762 (82,975)
Cash and cash equivalents at
beginning of period 104,146 204,341
------- -------
Cash and cash equivalents at end of
period $131,908 $121,366
======== ========
BRISTOW GROUP INC. AND SUBSIDIARIES
SELECTED OPERATING DATA
(In thousands, except flight hours and percentages)
(Unaudited)
Three Months Ended Nine Months Ended
December 31, December 31,
------------ ------------
2015 2014 2015 2014
---- ---- ---- ----
Flight hours (excluding Bristow Academy and
unconsolidated affiliates):
Europe Caspian 21,991 23,496 69,627 72,016
Africa 8,332 11,004 27,190 32,917
Americas 9,157 14,383 29,584 42,181
Asia Pacific 7,916 4,150 24,613 11,404
Consolidated 47,396 53,033 151,014 158,518
====== ====== ======= =======
Operating revenue:
Europe Caspian $192,400 $195,617 $603,397 $613,216
Africa 61,786 86,330 202,885 255,665
Americas 72,068 88,286 225,283 266,137
Asia Pacific 67,402 59,212 214,177 168,714
Corporate and other 3,609 1,942 18,542 20,142
Intra-region eliminations (2,108) (1,069) (10,005) (15,763)
Consolidated $395,157 $430,318 $1,254,279 $1,308,111
======== ======== ========== ==========
Operating income (loss):
Europe Caspian $26,986 $28,550 $56,243 $111,372
Africa 4,377 26,379 24,903 63,672
Americas 22,797 19,774 30,283 59,998
Asia Pacific 458 5,264 4,783 11,055
Corporate and other (30,387) (44,720) (95,278) (102,331)
Loss on disposal of assets (2,154) (26,331) (23,856) (25,594)
Consolidated $22,077 $8,916 $(2,922) $118,172
======= ====== ======= ========
Operating margin:
Europe Caspian 14.0% 14.6% 9.3% 18.2%
Africa 7.1% 30.6% 12.3% 24.9%
Americas 31.6% 22.4% 13.4% 22.5%
Asia Pacific 0.7% 8.9% 2.2% 6.6%
Consolidated 5.6% 2.1% (0.2)% 9.0%
Adjusted EBITDAR:
Europe Caspian $66,062 $64,107 $198,621 $205,357
Africa 18,162 29,785 60,877 77,680
Americas 35,908 33,233 76,645 101,113
Asia Pacific 16,599 14,511 49,994 39,839
Corporate and other (19,824) (32,580) (55,419) (76,495)
Consolidated $116,907 $109,056 $330,718 $347,494
======== ======== ======== ========
Adjusted EBITDAR margin:
Europe Caspian 34.3% 32.8% 32.9% 33.5%
Africa 29.4% 34.5% 30.0% 30.4%
Americas 49.8% 37.6% 34.0% 38.0%
Asia Pacific 24.6% 24.5% 23.3% 23.6%
Consolidated 29.6% 25.3% 26.4% 26.6%
BRISTOW GROUP INC. AND SUBSIDIARIES
AIRCRAFT COUNT
As of December 31, 2015
(Unaudited)
Aircraft in Consolidated Fleet
------------------------------
Percentage Helicopters
of Current
Period
Operating
Revenue
-------
Small Medium Large Training Fixed Unconsolidated
Wing
(1) Affiliates (4)
Total (2)(3) Total
----------- -----
Europe Caspian 48% - 14 70 - 28 112 - 112
Africa 16% 14 28 5 - 5 52 45 97
Americas 18% 19 44 18 - - 81 79 160
Asia Pacific 17% 2 9 23 - 13 47 - 47
Corporate and
other 1% - - - 68 - 68 - 68
--- --- --- --- --- --- --- --- ---
Total 100% 35 95 116 68 46 360 124 484
=== === === === === === === === ===
Aircraft not currently in
fleet: (5)
On order - 10 27 - - 37
Under option - 7 9 - - 16
_________
(1) Includes 30 fixed wing
aircraft operated by
Eastern Airways which
are included in the
Europe Caspian and
Africa regions and 13
fixed wing aircraft
operated by Airnorth
which are included in
the Asia Pacific
region.
(2) Includes 31 aircraft
held for sale and 115
leased aircraft as
follows:
Held for Sale Aircraft in Consolidated Fleet
--------------------------------------------
Helicopters
-----------
Small Medium Large Training Fixed Total
Wing
----
Europe
Caspian - 1 - - - 1
Africa 5 4 - - 1 10
Americas - 7 - - - 7
Asia
Pacific - - 2 - - 2
Corporate
and other - - - 11 - 11
--- ---
Total 5 12 2 11 1 31
=== === === === === ===
Leased Aircraft in Consolidated Fleet
-------------------------------------
Helicopters
-----------
Small Medium Large Training Fixed Total
Wing
----
Europe
Caspian - 5 37 - 11 53
Africa - 1 2 - 2 5
Americas 1 10 5 - - 16
Asia
Pacific 2 2 8 - 4 16
Corporate
and other - - - 25 - 25
Total 3 18 52 25 17 115
=== === === === === ===
(3) The average age of our fleet,
excluding fixed wing and training
aircraft, was approximately nine
years as of December 31, 2015.
(4) The 124 aircraft operated by our
unconsolidated affiliates do not
include those aircraft leased from
us. Includes 53 helicopters
(primarily medium) and 26 fixed wing
aircraft owned and managed by Líder,
our unconsolidated affiliate in
Brazil, which is included in our
Other International business unit.
(5) This table does not reflect aircraft
which our unconsolidated affiliates
may have on order or under option.
BRISTOW GROUP INC. AND SUBSIDIARIES
GAAP RECONCILIATIONS
These financial measures have not been prepared
in accordance with generally accepted
accounting principles ("GAAP") and have not
been audited or reviewed by our independent
registered public accounting firm. These
financial measures are therefore considered
non-GAAP financial measures. A description
of the adjustments to and reconciliations of
these non-GAAP financial measures to the most
comparable GAAP financial measures is as
follows:
Three months ended Nine months ended
December 31, December 31,
------------ ------------
2015 2014 2015 2014
---- ---- ---- ----
(In thousands, except per share amounts)
Adjusted operating income $36,622 $43,564 $92,132 $161,303
Loss on disposal of assets (2,154) (26,331) (23,856) (25,594)
Special items (12,391) (8,317) (71,198) (17,537)
Operating income (loss) $22,077 $8,916 $(2,922) $118,172
======= ====== ======= ========
Adjusted EBITDAR $116,907 $109,056 $330,718 $347,494
Loss on disposal of assets (2,154) (26,331) (23,856) (25,594)
Special items (7,348) (5,086) (48,752) (16,207)
Depreciation and
amortization (32,320) (23,625) (106,853) (77,164)
Rent expense (52,177) (46,282) (160,495) (114,839)
Interest expense (9,717) (7,094) (25,003) (22,415)
Provision for income taxes (9,623) (567) (9,500) (18,376)
Net income (loss) $3,568 $71 $(43,741) $72,899
====== === ======== =======
Adjusted provision for
income tax $(3,837) $(6,520) $(10,171) $(27,901)
Tax benefit on loss on
disposal of asset 496 5,298 5,487 5,153
Tax (expense) benefit on
special items (6,282) 655 (4,816) 4,372
Provision for income tax $(9,623) $(567) $(9,500) $(18,376)
======= ===== ======= ========
Adjusted effective tax rate
(1) 13.8% 20.2% 16.7% 20.9%
Effective tax rate (1) 73.0% 88.9% (27.7)% 20.1%
Adjusted net income $23,533 $24,719 $47,196 $102,159
Loss on disposal of assets (1,658) (21,033) (18,369) (20,441)
Special items (18,673) (4,654) (76,014) (12,495)
Net income (loss)
attributable to Bristow
Group $3,202 $(968) $(47,187) $69,223
====== ===== ======== =======
Adjusted diluted earnings
per share $0.67 $0.70 $1.34 $2.87
Loss on disposal of assets (0.05) (0.60) (0.52) (0.57)
Special items (0.53) (0.13) (2.20) (0.35)
Diluted earnings (loss) per
share 0.09 (0.03) (1.40) 1.94
_________
(1) Effective tax rate is
calculated by dividing
income tax expense by
pretax net income.
Adjusted effective tax
rate is calculated by
dividing adjusted income
tax expense by adjusted
pretax net income.
Three Months Ended
December 31, 2015
-----------------
Adjusted Adjusted Adjusted Adjusted
Operating EBITDAR Net Income Diluted
Income Earnings
Per
Share
-----
(In thousands, except per share amounts)
Severance costs (1) $(7,348) $(7,348) $(5,370) $(0.15)
Additional
depreciation expense
resulting from fleet
changes (2) (5,043) - (3,774) (0.11)
Tax valuation
allowance (3) - - (9,529) (0.27)
Total special items $(12,391) $(7,348) $(18,673) (0.53)
======== ======= ========
Three Months Ended
December 31, 2014
-----------------
Adjusted Adjusted Adjusted Adjusted
Operating EBITDAR Net Income Diluted
Income Earnings
Per
Share
-----
(In thousands, except per share amounts)
Gain on sale of
unconsolidated
affiliate (4) $ - $3,921 $2,549 $0.07
Impairment of
inventories (5) (3,805) (3,805) (3,044) (0.09)
Repurchase of 6 1/4%
Senior Notes (6) - (690) (594) (0.02)
Accounting correction
(7) (5,325) (5,325) (4,207) (0.12)
Accrued maintenance
cost reversal (8) 813 813 642 0.02
Total special items $(8,317) $(5,086) $(4,654) (0.13)
======= ======= =======
Nine Months Ended
December 31, 2015
-----------------
Adjusted Adjusted Adjusted Adjusted
Operating EBITDAR Net Income Diluted
Income Earnings
Per
Share
-----
(In thousands, except per share amounts)
Severance costs (1) $(21,039) $(21,039) $(16,758) $(0.47)
Additional
depreciation expense
resulting from fleet
changes (2) (22,446) - (15,532) (0.44)
Impairment of
inventories (5) (5,439) (5,439) (3,764) (0.11)
Goodwill impairment
(9) (22,274) (22,274) (24,996) (0.71)
Tax valuation
allowance (3) - - (14,964) (0.42)
Accretion of
redeemable
noncontrolling
interests (10) - - - (0.04)
Total special items $(71,198) $(48,752) $(76,014) (2.20)
======== ======== ========
Nine Months Ended
December 31, 2014
-----------------
Adjusted Adjusted Adjusted Adjusted
Operating EBITDAR Net Income Diluted
Income Earnings
Per
Share
-----
(In thousands, except per share amounts)
Gain on sale of
unconsolidated
affiliate (4) $ - $3,921 $2,549 $0.07
North America
restructuring (11) (1,611) (1,611) (1,047) (0.03)
CEO succession (12) (5,501) (5,501) (3,576) (0.10)
Impairment of
inventories (5) (7,167) (7,167) (5,734) (0.16)
Repurchase of 6 1/4%
Senior Notes (6) - (2,591) (2,113) (0.06)
Accounting correction
(7) (4,071) (4,071) (3,216) (0.09)
Accrued maintenance
cost reversal (8) 813 813 642 0.02
Total special items $(17,537) $(16,207) $(12,495) (0.35)
======== ======== ========
_________
(1) Relates to severance expense included in
direct costs and general and
administrative expense from our
voluntary and involuntary separation
programs.
(2) Relates to additional depreciation
expense due to fleet changes.
(3) Relates to the valuation of deferred tax
assets.
(4) Relates to a gain resulting from the
sale of our 50% interest in HCA.
(5) Relates to increase in inventory
allowance as a result of our review of
excess inventory on aircraft model
types we ceased ownership of or
classified all or a significant portion
of as held for sale.
(6) Relates to premium and fees associated
with the repurchase of some of our 6
1/4% Senior Notes due 2022.
(7) Relates to an accounting correction that
impacted income by $4.2 million and
$3.2 million for the three and nine
months ended December 31, 2014,
respectively.
(8) Relates to the reversal maintenance
costs associated with a prior
obligation to repair certain aircraft
in our fleet we ultimately did not
incur.
(9) Relates to an impairment of goodwill of
our Bristow Norway reporting unit
within our Europe Caspian region and
Bristow Academy reporting unit within
Corporate and other.
(10) Relates to the accounting for changes in
the redeemable value of put
arrangements whereby the noncontrolling
interest holders in Airnorth and
Eastern Airways may require us to
redeem the remaining shares in these
companies. This change does not impact
net earnings (loss), but rather is
accounted for as a reduction of
earnings (loss) available to common
shareholders in the calculation of
diluted earnings (loss) per share.
(11) Relates to a charges associated with the
restructuring of our North America
operations and planned closure of our
Alaska operations which related
primarily to employee severance and
retention costs.
(12) Relates to CEO succession cost.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/bristow-group-reports-financial-results-for-its-2016-fiscal-third-quarter-and-nine-months-ended-december-31-2015-300216909.html
SOURCE Bristow Group Inc.
