EX-99.1 2 ex99w1-080207.htm EXHIBIT 99.1 EARNINGS RELEASE ex99w1-080207.htm
Exhibit 99.1

 
News Release


Contact:
Joe Baj, VP & Treasurer
(713) 267-7605
Linda McNeill, Treasury Manager
(713) 267-7622
 

BRISTOW GROUP REPORTS FISCAL 2008 FIRST QUARTER RESULTS
 
HOUSTON, August 2, 2007 – Bristow Group Inc. (NYSE: BRS) today reported financial results for its fiscal 2008 first quarter ended June 30, 2007.
 
Highlights include:

§  
Revenue of $245.0 million increased by 10.8 percent over the first quarter of fiscal year 2007.  Revenue gains occurred in most of our business units, driven by improved pricing and the addition of new aircraft;

§  
Operating income of $29.9 million decreased by 3.8 percent over the first quarter of fiscal year 2007, primarily due to higher compensation and maintenance costs within our West Africa and Eastern Hemisphere (“EH”) Centralized Operations business units, partially offset by increased revenue;

§  
Net income of $22.7 million increased 31.6 percent versus net income for the first quarter of fiscal year 2007.  Increases in earnings from unconsolidated affiliates, interest income and other income contributed to the improvement in the latest quarter’s net income;

§  
Diluted earnings per share increased to $0.75 from $0.73 for the first quarter of fiscal year 2007.  Diluted earnings per share for the first quarter of fiscal year 2008 reflected the assumed conversion of the Company’s Mandatory Convertible Preferred Stock, which added approximately 6.5 million shares to the weighted average diluted shares calculation.

Capital and Liquidity:

§  
The June 30, 2007 consolidated balance sheet reflected $902.9 million in stockholders’ investment and $561.3 million of indebtedness;

§  
We had $339.5 million in cash and an undrawn $100 million revolving credit facility;

§  
We used $2.3 million of cash for operating activities, which included a $29.9 million increase in receivables, primarily from operations in Nigeria.  We have received payment for a majority of these Nigeria receivables in July.  We also used $121.8 million for capital expenditures, primarily for aircraft, and $12.9 million for the acquisition (net of cash acquired) of Bristow Academy during the first quarter of fiscal year 2008;

§  
Aircraft purchase commitments totaled $255.0 million, with options totaling $732.9 million as of June 30, 2007.



William E. Chiles, President and Chief Executive Officer of Bristow Group Inc., said, “We saw strong financial performance and good execution against our strategic plan during the latest quarter, and we remain on target with our plan to expand our fleet and improve overall margins and operating efficiencies.  The industry fundamentals continue to be very strong, and our customers remain committed to field development plans, which is the primary driver of our growth.  We continue to believe demand for aircraft will exceed supply over the next several years, which should create good opportunities to enhance revenue and margin growth going forward.”

CONFERENCE CALL

Management will conduct a conference call starting at 10:00 a.m. EDT (9:00 a.m. CDT) on Friday, August 3, 2007, to review financial results for the fiscal quarter ended June 30, 2007.  The conference call can be accessed as follows:

 
Via Webcast:
§   
Visit Bristow Group’s investor relations Web page at http://www.bristowgroup.com
 
 
§  
Live: Click on the link for “Q1 2008 Bristow Group Inc. Earnings Conference Call”
 
 
§   
Replay: A replay via webcast will be available approximately one hour after the call’s completion
 
Via Telephone within the U.S.:
§  
Live: Dial toll free (800) 218-0713
 
 
§   
Replay: A telephone replay will be available through August 17, 2007, by dialing toll free (800) 405-2236, passcode: 11093169
 
Via Telephone outside the U.S.:
§  
Live: Dial (303) 262-2142
 
 
§  
Replay: A telephone replay will be available through August 17, 2007 by dialing (303) 590-3000, passcode: 11093169
 
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.  Through its subsidiaries, affiliates and joint ventures, the Company has major transportation operations in the U.S. Gulf of Mexico and the North Sea, and in most of the other major offshore oil and gas producing regions of the world, including Alaska, Australia, Mexico, Nigeria, Russia and Trinidad. Additionally, the Company is a leading provider of production management services for oil and gas production facilities in the U.S. Gulf of Mexico.  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 customer demand, future results, the addition of new aircraft to our fleet, future investments and earnings power of aircraft.  It is important to note that the Company’s actual results could differ materially from those projected in such forward-looking statements.  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 June 30, 2007 and the annual report on Form 10-K for the year ended March 31, 2007.  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.

 (financial tables follow)




BRISTOW GROUP INC. AND SUBSIDIARIES
 
CONSOLIDATED STATEMENTS OF INCOME
 
(In thousands, except per share amounts)
 
 
Three Months Ended
June 30,
  
 
2006
    
2007
  
   
(Unaudited)
  
Gross revenue:
              
Operating revenue from non-affiliates
$
181,786
    
$
212,454
  
Operating revenue from affiliates
  
12,079
      
11,097
  
Reimbursable revenue from non-affiliates
  
26,125
      
20,348
  
Reimbursable revenue from affiliates
  
1,072
      
1,103
  
   
221,062
      
245,002
  
Operating expense:
              
Direct cost
  
138,470
      
163,836
  
Reimbursable expense
  
26,898
      
21,241
  
Depreciation and amortization
  
10,283
      
11,373
  
General and administrative
  
15,349
      
19,262
  
Gain on disposal of assets
  
(998
)
    
(584
)
   
190,002
      
215,128
  
Operating income
  
31,060
      
29,874
  
Earnings from unconsolidated affiliates, net of losses
  
1,559
      
3,390
  
Interest income
  
1,290
      
2,198
  
Interest expense
  
(3,236
)
    
(2,933
)
Other income (expense), net
  
(4,785
)
    
426
  
Income before provision for income taxes and minority interest
  
25,888
      
32,955
  
Provision for income taxes
  
(8,543
)
    
(9,834
)
Minority interest
  
(116
)
    
(449
)
Net income 
  
17,229
      
22,672
  
Preferred Stock dividends 
  
—
      
(3,162
)
Net income available to common stockholders
$
17,229
    
$
19,510
  
Earnings per common share:
              
Basic
$
0.74
    
$
0.83
  
Diluted
$
0.73
    
$
0.75
  
               
 Weighted average common shares outstanding:              
 Basic
  
23,393
      
23,603
  
 Diluted
  
23,508
      
30,219
  



 BRISTOW GROUP INC. AND SUBSIDIARIES
 
CONSOLIDATED BALANCE SHEETS
 
(In thousands)
 
 
 
March 31,
 
June 30,
 
 
 
2007
 
2007
 
ASSETS
 
  
 
 (Unaudited)
 
Current assets:
 
 
 
 
 
Cash and cash equivalents
 
$
184,188
 
$
339,542
 
Accounts receivable from non-affiliates
 
 
158,770
 
 
187,836
 
Accounts receivable from affiliates
 
 
17,199
 
 
19,694
 
Inventories
 
 
157,870
 
 
169,635
 
Prepaid expenses and other
 
 
17,947
 
 
17,768
 
Total current assets
 
 
535,974
 
 
734,475
 
Investments in unconsolidated affiliates
 
 
46,828
 
 
47,561
 
Property and equipment — at cost:
 
 
  
 
 
 
 
Land and buildings
 
 
51,850
 
 
56,339
 
Aircraft and equipment
 
 
1,141,578
 
 
1,269,390
 
 
 
 
1,193,428
 
 
1,325,729
 
Less: accumulated depreciation and amortization
 
 
(301,520
)
 
(308,258
)
 
 
 
891,908
 
 
1,017,471
 
Goodwill
 
 
20,368
 
 
27,119
 
Other assets
 
 
10,725
 
 
17,814
 
 
 
$
1,505,803
 
$
1,844,440
 
LIABILITIES AND STOCKHOLDERS' INVESTMENT
 
 
 
 
 
 
 
Current liabilities:
 
 
  
 
 
  
 
Accounts payable
 
$
42,343
 
$
43,556
 
Accrued wages, benefits and related taxes
 
 
38,281
 
 
38,877
 
Income taxes payable
 
 
4,377
 
 
2,240
 
Other accrued taxes
 
 
9,084
 
 
9,944
 
Deferred revenues
 
 
16,283
 
 
17,372
 
Accrued maintenance and repairs
    
12,309
    
13,083
  
Other accrued liabilities
 
 
22,828
 
 
22,027
 
Deferred taxes
 
 
17,611
 
 
17,962
 
Short-term borrowings and current maturities of long-term debt
 
 
4,852
 
 
7,923
 
Total current liabilities
 
 
167,968
 
 
172,984
 
Long-term debt, less current maturities
 
 
254,230
 
 
553,382
 
Accrued pension liabilities
 
 
113,069
 
 
112,992
 
Other liabilities and deferred credits
 
 
17,345
 
 
15,112
 
Deferred taxes
 
 
76,089
 
 
81,795
 
Minority interest
 
 
5,445
 
 
5,267
 
Commitments and contingencies
 
 
  
 
 
 
 
Stockholders' investment:
 
 
  
 
 
 
 
5.50% mandatory convertible preferred stock
 
 
222,554
 
 
222,554
 
Common stock
 
 
236
 
 
237
 
Additional paid-in capital
 
 
169,353
 
 
172,373
 
Retained earnings
 
 
515,589
 
 
535,099
 
Accumulated other comprehensive loss
 
 
(36,075
)
 
(27,355
)
 
 
 
871,657
 
 
902,908
 
 
 
$
1,505,803
 
$
1,844,440
 




BRISTOW GROUP INC. AND SUBSIDIARIES
CORPORATE ITEMS AFFECTING THE COMPARABILITY OF RESULTS
(In thousands, except per share amounts)
(Unaudited)

 
Three Months Ended June 30,
  
 
2006
  
2007
  
 
Pre-tax
Earnings
  
Net
Income
  
Diluted
Earnings
Per
Share
  
Pre-tax
Earnings
  
Net
Income
  
Diluted
Earnings
Per
Share
  
Investigations:
                                    
SEC  (1)
$
(108
)
$
(70
)
$
—
  
$
—
  
$
—
  
$
—
  
DOJ (2)
  
(591
)
  
(384
)
  
(0.02
)
  
—
    
—
    
—
  
Tax contingency related items (3)
  
—
    
800
    
0.03
    
—
    
918
    
0.03
  
7 ½% Senior Notes due 2017 (4)
  
—
    
—
    
—
    
(357
)
  
(232
)
  
(0.01
)
Foreign currency transaction gains (losses) (5)
  
(4,809
)
  
(3,126
)
  
(0.13
)
  
401
    
261
    
0.01
  
Preferred Stock (6)
  
—
    
—
    
—
    
826
    
537
    
(0.19
)
Total
$
(5,508
)
$
(2,780
)
$
(0.12
)
$
870
  
$
1,484
  
$
(0.16
)
______

(1)  
Represents costs incurred in conjunction with the SEC investigation regarding findings from the internal review initiated by the Audit Committee of our board of directors in fiscal year 2005 of certain payments made by two of our affiliated entities in a foreign country.  These costs are included in general & administrative costs in our consolidated statements of income.

(2)  
Represents legal and other professional fees incurred in connection with a document subpoena received from the Antitrust Division of the Department of Justice (“DOJ”) in June 2005, which related to a grand jury investigation of potential antitrust violations among providers of helicopter transportation services in the U.S. Gulf of Mexico focusing on activities during the period from January 1, 2000 to June 13, 2005.  These costs are included in general & administrative costs in our consolidated statements of income.

(3)  
Represents the net reduction in our accruals for tax contingencies resulting from our evaluation of the need for certain tax reserves.  These amounts represent a direct reduction in our provision for income taxes in our consolidated statements of income.

(4)  
Represents the effect on interest expense, net of interest income from invested proceeds, resulting from the issuance of 7 ½% Senior Notes due 2017 in June 2007.

(5)  
Represents foreign currency transaction gains and losses resulting from changes in exchange rates during the applicable periods.  The effects of these foreign currency transaction gains and losses were offset to a large extent by corresponding charges or benefits in the cumulative translation adjustment in stockholders’ investment with no overall economic effect.  These amounts are included in other income (expense), net in our consolidated statements of income.

(6)  
Represents the effect of the preferred stock offering completed in September and October 2006.  The net income effect results from interest income earned on remaining cash proceeds generated from the offering.  Diluted earnings per share for the three months ended June 30, 2007 was reduced by the effect of the inclusion of weighted average shares resulting from the assumed conversion of the preferred stock at the conversion rate that results in the most dilution, partially offset by the impact of higher interest income.

 
BRISTOW GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
 
Three Months Ended
June 30,
  
 
2006
  
2007
  
 
     (Unaudited)
  
Flight hours (excludes Bristow Academy and unconsolidated affiliates)
            
Helicopter Services:
            
North America 
  
42,609
    
40,271
  
South and Central America
  
9,285
    
11,367
  
Europe
  
10,170
    
10,821
  
West Africa
  
8,883
    
8,898
  
Southeast Asia
  
3,206
    
3,344
  
Other International
  
2,052
    
2,547
  
Consolidated total
  
76,205
    
77,248
  

Gross revenue:
            
Helicopter Services:
            
North America
$
63,368
  
$
60,939
  
South and Central America
  
13,012
    
16,036
  
Europe
  
71,981
    
83,357
  
West Africa
  
31,736
    
33,283
  
Southeast Asia
  
17,040
    
22,492
  
Other International
  
8,955
    
11,455
  
EH Centralized Operations
  
3,074
    
6,805
  
Bristow Academy
  
—
    
3,019
  
Intrasegment eliminations
  
(2,860
)
  
(6,235
)
Total Helicopter Services
  
206,306
    
231,151
  
Production Management Services
 
17,684
    
16,543
  
Corporate
  
(25
)
  
—
  
Intersegment eliminations
  
(2,903
)
  
(2,692
)
Consolidated total
$
221,062
  
$
245,002
  

Operating income:
            
Helicopter Services:
            
North America
$
9,233
  
$
10,714
  
South and Central America
  
3,970
    
3,685
  
Europe
  
14,096
    
14,575
  
West Africa
  
4,333
    
2,797
  
Southeast Asia
  
2,435
    
4,127
  
Other International
  
1,516
    
2,265
  
EH Centralized Operations
  
(1,767
)
  
(4,279
)
Bristow Academy
  
—
    
(91
)
Total Helicopter Services
  
33,816
    
33,793
  
Production Management Services
  
1,413
    
1,089
  
Gain on disposal of assets
  
998
    
584
  
Corporate
  
(5,167
)
  
(5,592
)
Consolidated total
$
31,060
  
$
29,874
  

Operating Margins
              
Helicopter Services:
              
North America
  
14.6
  
%
17.6
  
%
South and Central America
  
30.5
  
%
23.0
  
%
Europe
  
19.6
  
%
17.5
  
%
West Africa
  
13.7
  
%
8.4
  
%
Southeast Asia
  
14.3
  
%
18.3
  
%
Other International
  
16.9
  
%
19.8
  
%
EH Centralized Operations
  
(57.5
)
%
(62.9
)
%
Bristow Academy
  
N/A
    
(3.0
)
%
Total Helicopter Services
  
16.4
  
%
14.6
  
%
Production Management Services
  
8.0
  
%
6.6
  
%
Consolidated total
  
14.1
  
%
12.2
  
%