EX-99.1 2 ex99-08042010.htm PRESS RELEASE ex99-08042010.htm

       Exhibit 99.1

FOR IMMEDIATE RELEASE
        News Release

          Linda McNeill
          Investor Relations
          (713) 267-7622

BRISTOW GROUP REPORTS FINANCIAL RESULTS FOR ITS
2011 FIRST FISCAL QUARTER ENDED JUNE 30, 2010

 
 
HOUSTON, August 4, 2010 – Bristow Group Inc. (NYSE: BRS) today reported financial results for its June 2010 quarter.
 
 
“We are pleased with our June 2010 quarter results, which were slightly better than our internal expectations and compared favorably with the June quarter last year,” said William E. Chiles, President, Chief Executive Officer and Chief Financial Officer of Bristow Group.  “Operating margins improved in all business units with the exception of our Other International business unit which was lower primarily due to delayed start up of new contracts in Brazil.  We experienced only modest gains on the sale of a few aircraft; however, the aftermarket for used aircraft continues to show signs of improvement.  Our gains on aircraft sales during the June 2010 quarter were $4.3 million lower than those during the same quarter last year.  While these sales are a recurring part of our business, their timing can be unpredictable.
 
 
 “Our North America business unit benefitted during the quarter from contracts with BP in the Gulf of Mexico, where 18 of our aircraft are supporting the well control and spill cleanup efforts.  While we can’t predict how long this work will continue, during this quarter the new work more than offset lost business from customers stalled by the deep-water moratorium.”
 
JUNE 2010 QUARTER RESULTS

June 2010 quarter revenue totaled $292.2 million compared to $290.5 million in the June 2009 quarter.
 
Operating income in the June 2010 quarter was $39.7 million compared to $44.8 million in the June 2009 quarter.
 
 
Earnings before Interest, Taxes, Depreciation and Amortization (“EBITDA”) totaled $59.8 million in the June 2010 quarter compared to $61.7 million in the June 2009 quarter.  EBITDA is a measure that has not been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (“GAAP”).  Please refer to disclosures contained at the end of this news release for additional information about EBITDA.
 
Net income totaled $20.8 million in the June 2010 quarter, or $0.57 per diluted share, compared to $23.7 million, or $0.66 per diluted share, in the June 2009 quarter.
 

 
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“In addition to the activity with BP in the Gulf of Mexico, our June 2010 quarter results also benefitted from activity levels that remained robust in Australia and Nigeria,” Chiles said.

“Australia continues to generate improving returns, as we see the benefits of a two-year management overhaul.  Results in this business unit also benefitted from changes in foreign currency exchange rates.

“Near-term results in Nigeria may flatten commencing in the December 2010 quarter due to the non-renewal of a contract under which we operate six of a customer’s aircraft.  We expect the lost revenue of approximately $42 million per year to eventually be offset by new contract awards with other customers and increased ad hoc flying in this region.
 
 
“In Europe, overall activity levels declined in the June 2010 quarter, but they were in line with our expectations.  With the startup of new contracts, we expect results from our Europe business unit to strengthen beginning in the September quarter.  We are currently experiencing an increased level of tendering activity, which bodes well for the performance of this unit going forward.

“In our emerging market business unit, Other International, we were negatively impacted by our exit from Kazakhstan late last fiscal year and by weak results in Brazil caused mainly by higher costs associated with the startup of new aircraft contracts.  We expect results from Brazil to be significantly stronger beginning in the September quarter.
 
“Most of our larger customers are primarily national and international oil companies, and with oil prices appearing to stabilize in the $70-90 per barrel range, we expect capital spending on both exploration and development to improve this year.  Some large projects that were put on hold last year are being restarted, and we see additional opportunities in new and existing markets in the future.
 
“It is not possible to accurately predict demand for the remainder of the fiscal year in the Gulf of Mexico, given the political uncertainty over the deep water drilling moratorium.  We expect our contract work with BP to decline when the spill cleanup effort begins to wind down.  A small number of deepwater drilling rigs have already begun mobilization to other markets.  However, we are well-positioned to respond to demand changes in this and other markets in the future.

“As previously disclosed, we expect revenue and earnings per share for the current fiscal year to be stronger than fiscal year 2010 as we put additional newer-technology aircraft to work for our customers and realize the benefit of cost efficiencies from our recently reorganized structure.
 
 
“We continue to expect a sequential improvement in our financial results for the second quarter of this fiscal year and we also anticipate a much stronger second half compared to the first half of fiscal year 2011,” Chiles said.
 
CAPITAL AND LIQUIDITY
 
 
In the June 2010 quarter, net cash generated by operating activities was $25.7 million and net cash used in investing activities was $23.2 million.  At June 30, 2010, we had:
 
·  
$1.4 billion in stockholders’ investment and $711.5 million of indebtedness,
 
·  
$73.9 million in cash and a $100 million undrawn revolving credit facility, and
 
·  
$81 million in aircraft purchase commitments for seven aircraft.

 
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CONFERENCE CALL

Management will conduct a conference call starting at 10:00 a.m. EDT (9:00 a.m. CDT) on Thursday, August 5, 2010, to review financial results for the 2011 first quarter.  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 2011 First 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 1-877-941-9205
·  
Replay: A telephone replay will be available through August 19, 2010 and may be accessed by calling toll free 1-800-406-7325, passcode: 4330736#
 
Via Telephone outside the U.S.:
·  
Live: Dial 480-629-9866
·  
Replay: A telephone replay will be available through August 19, 2010 and may be accessed by calling 303-590-3030, passcode: 4330736#

ABOUT BRISTOW GROUP INC.

Bristow Group Inc. is a leading provider of helicopter services to the worldwide offshore energy industry.  Through its subsidiaries, affiliates and joint ventures, 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 Alaska, Australia, Brazil, Mexico, 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 the impact of activity levels, business performance, fiscal 2011 results, industry capital spending and other 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.  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, 2010 and annual report on Form 10-K for the fiscal year ended March 31, 2010.  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)

 
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             BRISTOW GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)

   
Three Months Ended
  
   
June 30,
  
   
2010
    
2009
  
Gross revenue:
                
Operating revenue from non-affiliates
  
$
254,594
    
$
248,891
  
Operating revenue from affiliates
    
17,415
      
14,602
  
Reimbursable revenue from non-affiliates
    
20,063
      
25,853
  
Reimbursable revenue from affiliates
    
166
      
1,106
  
     
292,238
      
290,452
  
Operating expense:
                
Direct cost
    
183,164
      
180,677
  
Reimbursable expense
    
20,178
      
26,657
  
Depreciation and amortization
    
19,331
      
18,186
  
General and administrative
    
30,902
      
28,802
  
     
253,575
      
254,322
  
                 
Gain on disposal of other assets
    
1,718
      
6,009
  
Earnings from unconsolidated affiliates, net of losses
    
(702
)
    
2,633
  
Operating income
    
39,679
      
44,772
  
                 
Interest income
    
292
      
222
  
Interest expense
    
(11,038
)
    
(10,012
)
Other income (expense), net
    
515
      
(1,481
)
Income before provision for income taxes
    
29,448
      
33,501
  
Provision for income taxes
    
(8,540
)
    
(9,510
)
Net income
    
20,908
      
23,991
  
Net income attributable to noncontrolling interests
    
(100
)
    
(268
)
Net income attributable to Bristow Group
    
20,808
      
23,723
  
Preferred stock dividends
    
—
      
(3,162
)
Net income available to common stockholders
  
$
20,808
    
$
20,561
  
                 
Earnings per common share:
                
Basic
  
$
0.58
    
$
0.71
  
Diluted
  
$
0.57
    
$
0.66
  
                 
Weighted average number of common shares outstanding:
                
Basic
    
35,969
      
29,133
  
Diluted
    
36,281
      
35,782
  
                 
EBITDA
  
$
59,817
    
$
61,699
  



 
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BRISTOW GROUP INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)

   
June 30,
  
March 31,
  
   
2010
  
2010
  
   
(Unaudited)
      
       
ASSETS
Current assets:
              
 
Cash and cash equivalents
  
$
73,858
  
$
77,793
  
 
Accounts receivable from non-affiliates
    
224,899
    
203,312
  
 
Accounts receivable from affiliates
    
18,533
    
16,955
  
 
Inventories
    
186,223
    
186,863
  
 
Prepaid expenses and other current assets
    
37,080
    
31,448
  
   
Total current assets
    
540,593
    
516,371
  
Investment in unconsolidated affiliates
    
200,797
    
204,863
  
Property and equipment – at cost:
              
 
Land and buildings
    
86,091
    
86,826
  
 
Aircraft and equipment
    
2,032,803
    
2,036,962
  
         
2,118,894
    
2,123,788
  
 
Less – Accumulated depreciation and amortization
    
(407,306
)
  
(404,443
)
         
1,711,588
    
1,719,345
  
Goodwill
    
31,182
    
31,755
  
Other assets
    
20,405
    
22,286
  
       
$
2,504,565
  
$
2,494,620
  
                   
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
Current liabilities:
              
 
Accounts payable
  
$
46,424
  
$
48,545
  
 
Accrued wages, benefits and related taxes
    
29,160
    
35,835
  
 
Income taxes payable
    
—
    
2,009
  
 
Other accrued taxes
    
4,856
    
3,056
  
 
Deferred revenues
    
16,055
    
19,321
  
 
Accrued maintenance and repairs
    
12,836
    
10,828
  
 
Accrued interest
    
8,601
    
6,430
  
 
Other accrued liabilities
    
22,878
    
14,508
  
 
Deferred taxes
    
10,126
    
10,217
  
 
Short-term borrowings and current maturities of long-term debt
    
14,890
    
15,366
  
   
Total current liabilities
    
165,826
    
166,115
  
Long-term debt, less current maturities
    
696,594
    
701,195
  
Accrued pension liabilities
    
104,076
    
106,573
  
Other liabilities and deferred credits
    
19,852
    
20,842
  
Deferred taxes
    
148,625
    
143,324
  
               
Stockholders’ investment:
              
 
Common stock
    
362
    
359
  
 
Additional paid-in capital
    
680,190
    
677,397
  
 
Retained earnings
    
840,953
    
820,145
  
 
Accumulated other comprehensive loss
    
(158,089
)
  
(148,102
)
       
1,363,416
    
1,349,799
  
 
Noncontrolling interests
    
6,176
    
6,772
  
         
1,369,592
    
1,356,571
  
       
$
2,504,565
  
$
2,494,620
  

 

 
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BRISTOW GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)


   
Three Months Ended
June  30,
  
   
2010
  
2009
  
Cash flows from operating activities:
              
 
Net income 
  
$
20,908
  
$
23,991
  
Adjustments to reconcile net income to net cash provided by operating activities:
              
 
Depreciation and amortization
    
19,331
    
18,186
  
 
Deferred income taxes
    
5,740
    
2,810
  
 
Discount amortization on long-term debt
    
776
    
725
  
 
Gain on disposal of assets
    
(1,718
)
  
(6,009
)
 
Gain on sale of joint ventures
    
(578
)
  
—
    
 
Stock-based compensation
    
3,730
    
3,607
  
 
Equity in earnings from unconsolidated affiliates less than dividends received
    
702
    
1,078
  
 
Tax benefit related to stock-based compensation
    
(163
)
  
(26
)
Increase (decrease) in cash resulting from changes in:
              
 
Accounts receivable
    
(20,451
)
  
9,866
  
 
Inventories
    
(944
)
  
(6,336
)
 
Prepaid expenses and other assets
    
162
    
(7,958
)
 
Accounts payable
    
(1,466
)
  
6,081
  
 
Accrued liabilities
    
2,563
    
(13,127
)
 
Other liabilities and deferred credits
    
(2,942
)
  
2,092
  
Net cash provided by operating activities
    
25,650
    
34,980
  
Cash flows from investing activities:
              
 
Capital expenditures
    
(29,508
)
  
(86,040
)
 
Deposits on assets held for sale
    
1,000
    
23,764
  
 
Proceeds from sale of joint ventures
    
1,291
    
—
  
 
Proceeds from asset dispositions
    
4,022
    
40,364
  
 
Acquisition, net of cash received
    
—
    
(178,638
)
Net cash used in investing activities
    
(23,195
)
  
(200,550
)
Cash flows from financing activities:
              
 
Proceeds from borrowings
    
1,963
    
—
  
 
Repayment of debt
    
(6,767
)
  
(1,404
)
 
Distribution to noncontrolling interest owners
    
(637
)
  
—
  
 
Partial prepayment of put/call obligation
    
(14
)
  
(19
)
 
Preferred stock dividends paid
    
—
    
(3,162
)
 
Issuance of common stock
    
111
    
346
  
 
Tax benefit related to stock-based compensation
    
163
    
26
  
Net cash used in financing activities
    
(5,181
)
  
(4,213
)
Effect of exchange rate changes on cash and cash equivalents
    
(1,209
)
  
7,109
  
Net decrease in cash and cash equivalents
    
(3,935
)
  
(162,674
)
Cash and cash equivalents at beginning of period
    
77,793
    
300,969
  
Cash and cash equivalents at end of period
  
$
73,858
  
$
138,295
  



 
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BRISTOW GROUP INC. AND SUBSIDIARIES
SELECTED OPERATING DATA
(In thousands, except flight hours and percentages)
(Unaudited)

 
Three Months Ended
  
 
June 30,
  
 
2010
    
2009
  
Flight hours (excludes Bristow Academy andunconsolidated affiliates):
              
North America
  
21,404
      
22,117
  
Europe
  
12,967
      
14,855
  
West Africa
  
9,760
      
8,950
  
Australia
  
3,240
      
2,880
  
Other International
  
11,478
      
11,125
  
Consolidated total
  
58,849
      
59,927
  

Gross revenue:
              
North America
$
52,811
    
$
49,856
  
Europe
  
101,691
      
115,065
  
West Africa
  
59,096
      
54,817
  
Australia
  
35,291
      
28,163
  
Other International
  
32,819
      
32,994
  
Corporate and other
  
10,842
      
11,816
  
Intrasegment eliminations
  
(312
)
    
(2,259
)
Consolidated total
$
292,238
    
$
290,452
  

Operating income (loss):
              
North America
$
5,308
    
$
4,426
  
Europe
  
18,299
      
19,778
  
West Africa
  
15,636
      
13,663
  
Australia
  
7,952
      
5,656
  
Other International
  
2,265
      
7,212
  
Corporate and other
  
(11,499
)
    
(11,972
)
Gain on disposal of assets
  
1,718
      
6,009
  
Consolidated total
$
39,679
    
$
44,772
  

Operating margin:
                
North America
  
10.1
 %
  
8.9
 %
Europe
  
18.0
 %
  
17.2
 %
West Africa
  
26.5
 %
  
24.9
 %
Australia
  
22.5
 %
  
20.1
 %
Other International
  
6.9
 %
  
21.9
 %
Consolidated total
  
13.6
 %
  
15.4
 %


 
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BRISTOW GROUP INC. AND SUBSIDIARIES
AIRCRAFT COUNT
AS OF JUNE 30, 2010

   
Aircraft in Consolidated Fleet
          
   
Helicopters
                  
   
Small
  
Medium
  
Large
  
Training
  
Fixed
Wing
  
Total (1)
 
Unconsolidated
Affiliates (2)
  
Total
North America
  
74
  
28
  
6
  
—
  
—
  
108
  
—
    
108
Europe
  
—
  
14
  
37
  
—
  
—
  
51
  
63
    
114
West Africa
  
12
  
33
  
5
  
—
  
3
  
53
  
—
    
53
Australia
  
2
  
13
  
18
  
—
  
—
  
33
  
—
    
33
Other International
  
5
  
41
  
13
  
—
  
—
  
59
  
136
    
195
Corporate and other
  
—
  
—
  
—
  
80
  
—
  
80
  
—
    
80
Total
  
93
  
129
  
79
  
80
  
3
  
384
  
199
    
583
Aircraft not currently in fleet: (3)
                                
On order
  
—
  
3
  
4
  
—
  
—
  
7
        
Under option
  
—
  
28
  
13
  
—
  
—
  
41
        
_________

(1)
Includes 14 aircraft held for sale.
   
(2)
The 199 aircraft operated or managed by our unconsolidated affiliates are in addition to those aircraft leased from us.
   
(3)
This table does not reflect aircraft which our unconsolidated affiliates may have on order or under option.

BRISTOW GROUP INC. AND SUBSIDIARIES
GAAP RECONCILIATIONS
 
EBITDA is a measure that has not been prepared in accordance with GAAP and has not been audited or reviewed by our independent auditors.  EBITDA is therefore considered a non-GAAP financial measure.  A description of adjustments and a reconciliation to net income, the most comparable GAAP financial measure to EBITDA, is as follows (in thousands):
 
 
Three Months Ended
  
 
June 30,
  
 
2010
    
2009
  
 
(Unaudited)
Net income
$
20,908
    
$
23,991
  
Provision for income taxes
  
8,540
      
9,510
  
Interest expense
  
11,038
      
10,012
  
Depreciation and amortization
  
19,331
      
18,186
  
EBITDA
$
59,817
    
$
61,699
  

# # #

 
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