Condensed Consolidated Financial Information

6 Months Ended

Jun. 30, 2011

Condensed Consolidating Financial Information [Abstract]

Condensed Consolidated Financial Information

10. Condensed Consolidating Financial Information

Our 8.625% Senior Notes are fully and unconditionally guaranteed on a joint and several, senior basis by all of our domestic subsidiaries. All of our domestic subsidiaries are 100% owned.

The following supplemental condensed financial information sets forth, on a consolidated basis, the balance sheet, statement of operations, and statement of cash flows information for PHI, Inc. (“Parent Company Only”) and the guarantor subsidiaries. The eliminating entries eliminate investments in subsidiaries, intercompany balances, and intercompany revenues and expenses. The condensed consolidating financial statements have been prepared on the same basis as the consolidated financial statements of PHI, Inc. The equity method is followed by the parent company within these financials.

PHI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(Thousands of dollars)
(Unaudited)

	June 30, 2011
	Parent
	Company			Guarantor
	Only			Subsidiaries(1)		Eliminations			Consolidated
ASSETS
Current Assets:
Cash	$	1,957		$	917	$	—		$	2,874
Short-term investments		89,750			—		—			89,750
Accounts receivable — net		88,336			9,389		—			97,725
Intercompany receivable		—			84,123		(84,123	)		—
Inventories of spare parts — net		57,288			—		—			57,288
Other current assets		12,816			14		—			12,830
Income taxes receivable		925			—		—			925
Total current assets		251,072			94,443		(84,123	)		261,392
Investment in subsidiaries and other		78,617			—		(78,617	)		—
Other assets		32,403			21		—			32,424
Property and equipment — net		660,399			12,538		—			672,937
Total assets	$	1,022,491		$	107,002	$	(162,740	)	$	966,753
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	18,515		$	658	$	—		$	19,173
Accrued liabilities		21,481			5,150		—			26,631
Other current liabilities		45,800			—		—			45,800
Intercompany payable		84,123			—		(84,123	)		—
Total current liabilities		169,919			5,808		(84,123	)		91,604
Long-term debt		316,189			—		—			316,189
Deferred income taxes and other long-term
liabilities		65,763			22,577		—			88,340
Shareholders’ Equity:
Common stock and paid-in capital		292,934			2,674		(2,674	)		292,934
Accumulated other comprehensive loss		(10	)		—		—			(10	)
Retained earnings		177,696			75,943		(75,943	)		177,696
Total shareholders’ equity		470,620			78,617		(78,617	)		470,620
Total liabilities and shareholders’ equity	$	1,022,491		$	107,002	$	(162,740	)	$	966,753

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.

PHI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(Thousands of dollars)

	December 31, 2010
	Parent
	Company			Guarantor
	Only			Subsidiaries(1)		Eliminations			Consolidated
ASSETS
Current Assets:
Cash	$	2,957		$	671	$	—		$	3,628
Short-term investments		150,072			—		—			150,072
Accounts receivable — net		81,393			8,266		—			89,659
Intercompany receivable		—			79,810		(79,810	)		—
Inventories of spare parts — net		59,336			—		—			59,336
Other current assets		16,224			9		—			16,233
Income taxes receivable		558			—		—			558
Total current assets		310,540			88,756		(79,810	)		319,486
Investment in subsidiaries and others		75,114			—		(75,114	)		—
Other assets		29,099			21		—			29,120
Property and equipment, net		583,091			13,442		—			596,533
Total assets	$	997,844		$	102,219	$	(154,924	)	$	945,139
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	22,191		$	213	$	—		$	22,404
Accrued liabilities		23,482			4,837		—			28,319
Intercompany payable		79,810			—		(79,810	)		—
Total current liabilities		125,483			5,050		(79,810	)		50,723
Long-term debt		331,074			—		—			331,074
Deferred income taxes and other long-term
liabilities		68,871			22,055		—			90,926
Shareholders’ Equity:
Common stock and paid-in capital		292,934			2,674		(2,674	)		292,934
Accumulated other comprehensive
loss		(162	)		—		—			(162	)
Retained earnings		179,644			72,440		(72,440	)		179,644
Total shareholders’ equity		472,416			75,114		(75,114	)		472,416
Total liabilities and shareholders’ equity	$	997,844		$	102,219	$	(154,924	)	$	945,139

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.

PHI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
(Thousands of dollars)
(Unaudited)

	For the quarter ended June 30, 2011
	Parent
	Company			Guarantor
	Only			Subsidiaries(1)		Eliminations			Consolidated
Operating revenues, net	$	120,033		$	15,943	$	—		$	135,976
Management fees		637			—		(637	)		—
Gain on dispositions of assets, net		77			—		—			77
Other, principally interest income		93			—		—			93
		120,840			15,943		(637	)		136,146
Expenses:
Direct expenses		108,180			12,263		—			120,443
Management fees		—			637		(637	)		—
Selling, general, and administrative expenses		7,479			257		—			7,736
Equity in net income of consolidated subsidiaries		(1,670	)		—		1,670			—
Interest expense		6,761			—		—			6,761
		120,750			13,157		1,033			134,940
Earnings before income taxes		90			2,786		(1,670	)		1,206
Income tax (benefit) expense		(633	)		1,116		—			483
Net earnings	$	723		$	1,670	$	(1,670	)	$	723

	For the quarter ended June 30, 2010
	Parent
	Company			Guarantor
	Only			Subsidiaries(1)		Eliminations			Consolidated
Operating revenues, net	$	123,442		$	16,155	$	—		$	139,597
Management fees		647			—		(647	)		—
Gain on dispositions of assets, net		117			—		—			117
Other, principally interest income		5			—		—			5
		124,211			16,155		(647	)		139,719
Expenses:
Direct expenses		102,422			13,679		—			116,101
Management fees		—			647		(647	)		—
Selling, general and administrative expenses		7,357			321		—			7,678
Equity in net income of consolidated subsidiaries		(905	)		—		905			—
Interest expense		4,183			—		—			4,183
		113,057			14,647		258			127,962
Earnings before income taxes		11,154			1,508		(905	)		11,757
Income tax expense		4,100			603		—			4,703
Net earnings	$	7,054		$	905	$	(905	)	$	7,054

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.

PHI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
(Thousands of dollars)
(Unaudited)

	For the six months ended June 30, 2011
	Parent
	Company			Guarantor
	Only			Subsidiaries(1)		Eliminations			Consolidated
Operating revenues, net	$	224,434		$	31,182	$	—		$	255,616
Management fees		1,247			—		(1,247	)		—
Gain on dispositions of assets, net		223			—		—			223
Other, principally interest income		636			—		—			636
		226,540			31,182		(1,247	)		256,475
Expenses:
Direct expenses		205,103			23,546		—			228,649
Management fees		—			1,247		(1,247	)		—
Selling, general and administrative expenses		16,730			549		—			17,279
Equity in net income of consolidated subsidiaries		(3,503	)		—		3,503			—
Interest expense		13,793			—		—			13,793
		232,123			25,342		2,256			259,721
(Loss) earnings before income taxes		(5,583	)		5,840		(3,503	)		(3,246	)
Income tax (benefit) expense		(3,635	)		2,337		—			(1,298	)
Net (loss) earnings	$	(1,948	)	$	3,503	$	(3,503	)	$	(1,948	)

	For the six months ended June 30, 2010
	Parent
	Company			Guarantor
	Only			Subsidiaries(1)		Eliminations			Consolidated
Operating revenues, net	$	227,492		$	33,714	$	—		$	261,206
Management fees		1,349			—		(1,349	)		—
Gain on dispositions of assets, net		123			—		—			123
Other, principally interest income		36			—		—			36
		229,000			33,714		(1,349	)		261,365
Expenses:
Direct expenses		193,534			26,774		—			220,308
Management fees		—			1,349		(1,349	)		—
Selling, general and administrative expenses		13,637			766		—			14,403
Equity in net income of consolidated subsidiaries		(2,895	)		—		2,895			—
Interest expense		8,179			—		—			8,179
		212,455			28,889		1,546			242,890
Earnings before income taxes		16,545			4,825		(2,895	)		18,475
Income tax expense		5,460			1,930		—			7,390
Net earnings	$	11,085		$	2,895	$	(2,895	)	$	11,085

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.

PHI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(Thousands of dollars)
(Unaudited)

	For the six months ended June 30, 2011
	Parent
	Company			Guarantor
	Only			Subsidiaries(1)		Eliminations		Consolidated
Net cash provided by operating activities	$	6,002		$	246	$	—	$	6,248
Investing activities:
Purchase of property and equipment		(44,378	)		—		—		(44,378	)
Purchase of short-term investments		(153,812	)		—		—		(153,812	)
Proceeds from asset dispositions		2,000			—		—		2,000
Proceeds from sale of short-term investments		212,993			—		—		212,993
Deposits on aircraft		(8,920	)		—		—		(8,920	)
Net cash used in investing activities		7,883			—		—		7,883
Financing activities:
Payments on line of credit, net		(14,885	)		—		—		(14,885	)
Net cash used in financing activities		(14,885	)		—		—		(14,885	)
(Decrease) increase in cash		(1,000	)		246		—		(754	)
Cash, beginning of period		2,957			671		—		3,628
Cash, end of period	$	1,957		$	917	$	—	$	2,874

	For the six months ended June 30, 2010
	Parent
	Company			Guarantor
	Only			Subsidiaries(1)			Eliminations		Consolidated
Net cash provided by operating activities	$	25,786		$	1,687		$	—	$	27,473
Investing activities:
Purchase of property and equipment		(32,388	)		(1,544	)		—		(33,932	)
Proceeds from asset dispositions		1,164			—			—		1,164
Purchase of short-term investments, net		(1,004	)		—			—		(1,004	)
Net cash used in investing activities		(32,228	)		(1,544	)		—		(33,772	)
Financing activities:
Proceeds from line of credit, net		6,482			—			—		6,482
Net cash provided by financing activities		6,482			—			—		6,482
Increase in cash		40			143			—		183
Cash, beginning of period		1,678			823			—		2,501
Cash, end of period	$	1,718		$	966		$	—	$	2,684

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.