FLYING SMART.
FLYING RIGHT.

Sagittis facilisis amet, vel, natoque integer. Rhoncus dapibus, tempor! Turpis nisi et ultricies vel. Magnis? Nascetur et enim eros ac rhoncus! Vut facilisis risus.

News Release

<< Back
Bristow Group Reports Fiscal Fourth Quarter and Full Fiscal Year 2017 Results
Download PDF Download PDF
Liquidity increased $76 million in the March quarter to $357 million

HOUSTON, May 23, 2017 /PRNewswire/ -- Bristow Group Inc. (NYSE: BRS) today reported the following results for the quarter and full fiscal year ended March 31, 2017. All amounts shown are dollar amounts in thousands unless otherwise noted:



Three Month Period


Full Year



FY2017


FY2016


% Change


FY2017


FY2016


% Change

Operating revenue


$

323,651



$

375,268



(13.8)

%


$

1,347,850



$

1,629,547



(17.3)

%

Net loss attributable to Bristow Group


(78,040)



(25,255)



(209.0)

%


(170,536)



(73,940)



(130.6)

%

Diluted loss per share


(2.22)



(0.72)



(208.3)

%


(4.87)



(2.12)



(129.7)

%

Adjusted EBITDA (1)


3,687



35,300



(89.6)

%


71,084



205,523



(65.4)

%

Adjusted net income (loss) (1)


(40,302)



4,716



(954.6)

%


(74,525)



51,308



(245.3)

%

Adjusted diluted earnings (loss) per share (1)


(1.15)



0.13



(984.6)

%


(2.13)



1.45



(246.9)

%

Operating cash flow


25,562



60,342



(57.6)

%


10,702



116,026



(90.8)

%

Capital expenditures


15,384



29,010



(47.0)

%


135,110



372,375



(63.7)

%

Rent expense


55,718



51,345



8.5

%


212,608



211,840



0.4

%

 



March 31,


December 31,


March 31,


% Change


% Change



2017


2016


2016


Quarter over quarter


Year over year

Cash


$

96,656



$

71,159



$

104,310



35.8

%


(7.3)

%

Undrawn borrowing capacity on Revolving Credit Facility


260,320



209,420



255,420



24.3

%


1.9

%

Total liquidity


$

356,976



$

280,579



$

359,730



27.2

%


(0.8)

%


______________


(1)

A full reconciliation of non-GAAP financial measurements is included at the end of this news release

For the March 2017 quarter, we reported a GAAP net loss of $78.0 million, or diluted loss per share of $2.22, compared to GAAP net loss of $25.3 million, or diluted loss per share of $0.72, for the March 2016 quarter. Additionally, we reported an adjusted net loss of $40.3 million, or adjusted diluted loss per share of $1.15, for the March 2017 quarter compared to adjusted net income of $4.7 million, or adjusted diluted earnings per share of $0.13, for the March 2016 quarter.

BUSINESS AND FINANCIAL UPDATE

  • The March 2017 quarter results reflect the decrease of our oil and gas operations' margins due to the continued offshore oil and gas industry downturn with certain contract work ending during the quarter being partially offset by the one-time benefit of $11.1 million from a contract termination payment.
  • The March 2017 quarter and fiscal year 2017 results were also impacted by costs incurred resulting from the grounding of the Airbus H225 fleet, the impact of the depreciation of the British pound sterling and significant non-cash tax charges; the tax charges did not impact adjusted net loss and adjusted diluted loss per share.
  • We increased liquidity during the March 2017 quarter by $76.4 million and funded $290.1 million of previously announced financings of which $200 million was used to repay term loan debt, and further reduced capital expenditures and working capital needs; a previously announced executed commitment letter for up to $230 million is currently expected to close no later than June 30, 2017.
  • On March 31, 2017, we commenced search and rescue (SAR) operations at our tenth and final base and transitioned one of two Gap SAR bases to the U.K. SAR contract, with the final Gap SAR base expected to transition to the U.K. SAR contract in July 2017.
  • We expect fiscal year 2018 results to be impacted by the continued offshore oil and gas industry downturn. Industry conditions in the March 2017 quarter are expected to continue into fiscal year 2018; however, we anticipate sequential quarterly improvement beginning in the second half of the fiscal year as new contracts commence and we further eliminate costs and focus our efforts on recovering costs from OEMs, while focusing on liquidity.

"I am very proud of our team's results in improving safety and efficiency during this past year," said Jonathan Baliff, President and Chief Executive Officer of Bristow Group. "Our fourth quarter results reflect the ongoing difficult conditions in the offshore oil and gas industry with reduced demand for helicopter transportation that will continue into fiscal 2018."

"Just like we successfully did in fiscal 2017, we will reduce costs, further improve liquidity and recover costs incurred resulting from the actions of OEMs. In addition to improving our balance sheet, these efforts should make us more competitive as we focus on getting more aircraft on contract."

Operating revenue from external clients by line of service was as follows:


Three Month Period


Full Year


FY2017


FY2016


% Change


FY2017


FY2016


% Change














(in thousands, except percentages)

Oil and gas services

$

233,753



$

255,017



(8.3)

%


$

956,649



$

1,222,501



(21.7)

%

Fixed wing services

43,498



53,552



(18.8)

%


191,609



208,538



(8.1)

%

U.K. SAR services

43,963



62,118



(29.2)

%


189,555



177,230



7.0

%

Corporate and other

2,437



4,581



(46.8)

%


10,037



21,278



(52.8)

%

Total operating revenue

$

323,651



$

375,268



(13.8)

%


$

1,347,850



$

1,629,547



(17.3)

%

FOURTH QUARTER FY2017 RESULTS

During fiscal year 2017, the offshore oil and gas industry continued to experience a significant downturn primarily due to a decline in crude oil prices which negatively impacted activity with our oil and gas clients. This decline started in fiscal year 2015 and continued through fiscal year 2017, resulting in a significant decrease in gross revenue for our oil and gas services year-over-year. In addition to reduced activity, changes in foreign currency exchange rates also contributed to the decrease in gross revenue year-over-year.

Additionally, during March 2017, we came to an agreement with a client in our Asia Pacific Region for which we had incurred significant start-up costs on a project in Australia that was cancelled prior to contract commencement. In connection with the cancellation, we agreed to a termination fee with the client of $11.1 million, which is recorded in operating revenue in the March 2017 quarter. Additionally, we had previously deferred revenue and costs totaling $6.1 million each related to this contract, which is included in operating revenue and direct costs in the March 2017 quarter.

We reported a net loss of $78.0 million and diluted loss per share of $2.22 for the March 2017 quarter compared to net loss of $25.3 million and diluted loss per share of $0.72 for the March 2016 quarter. The year-over-year increase in net loss and diluted loss per share was primarily due to the decline in oil and gas revenue discussed above, higher interest expense resulting from additional borrowings and increased tax charges partially offset by less of a loss from disposal of assets and lower depreciation and amortization expense. Additionally, the March 2016 quarter included goodwill and intangible asset impairment charges of $27.4 million (included in loss on impairment).

The net loss for the March 2017 quarter was significantly impacted by the following items:

  • Organizational restructuring costs of $2.8 million ($2.1 million net of tax), which includes severance expense of $1.1 million and other restructuring costs of $1.7 million; $0.6 million of the restructuring costs are included in direct costs and $2.2 million are included in general and administrative expense,
  • Loss on disposal of assets of $1.4 million ($0.8 million net of tax) and accelerated depreciation of $1.1 million ($0.7 million net of tax),
  • Reversal of $5.9 million ($5.9 million net of tax) of contingent consideration related to the Airnorth acquisition, and
  • Tax items totaling $40.0 million that include a one-time non-cash tax effect from repositioning of certain aircraft from one tax jurisdiction to another related to recent financing transactions resulting in additional income tax expense of $22.5 million and non-cash adjustments related to the valuation of deferred tax assets of $17.5 million.

Excluding these items, adjusted net loss and adjusted diluted loss per share were $40.3 million and $1.15, respectively, for the March 2017 quarter compared to $4.7 million and $0.13, respectively, for the March 2016 quarter. Adjusted EBITDA, which excludes these items with the exception of accelerated depreciation and the tax items, also decreased year-over-year to $3.7 million in the March 2017 quarter from $35.3 million in the March 2016 quarter.

LIQUIDITY AND FINANCIAL FLEXIBILITY

The second loan from Lombard funded in January 2017 in the amount of $90.1 million. Additionally, the previously announced Macquarie term loan funded on March 7, 2017 in the amount of $200 million. The proceeds from the Macquarie financing were used to repay $154.1 million of our $200 million term loan and $45.9 million of our $350 million term loan.

Also, as previously announced, we executed a credit agreement commitment letter for an approximate six-year, $230 million secured equipment financing with PK Transportation Finance Ireland Limited, a part of GE Capital Aviation Services ("GECAS"). We expect this financing to close no later than June 30, 2017. The proceeds from the financing are expected to be used to repay amounts outstanding under our existing bank credit facilities.

Don Miller, Senior Vice President and Chief Financial Officer, commented, "Our liquidity improved by $76.4 million in the March 2017 quarter to $357.0 million as of March 31, 2017 resulting from the recently funded financings and operating cash flow of $25.6 million generated during the quarter. Our improved liquidity is essential as we navigate through this challenging market environment."

REGIONAL PERFORMANCE

Europe Caspian



Three Month Period


Full Year



FY2017


FY2016


% Change


FY2017


FY2016


% Change
















(in thousands, except percentages)

Operating revenue


$

162,511



$

206,517



(21.3)

%


$

710,581



$

809,914



(12.3)

%

Earnings from unconsolidated affiliates


$

32



$

(35)



191.4

%


$

273



$

310



(11.9)

%

Operating income (loss)


$

(4,628)



(5,837)



20.7

%


$

13,840



50,406



(72.5)

%

Operating margin


(2.8)

%


(2.8)

%


%


1.9

%


6.2

%


(69.4)

%

Adjusted EBITDA


$

1,890



$

28,441



(93.4)

%


$

45,163



$

123,952



(63.6)

%

Adjusted EBITDA margin


1.2

%


13.8

%


(91.3)

%


6.4

%


15.3

%


(58.2)

%

Rent expense


$

34,065



$

33,267



2.4

%


$

134,072



$

136,377



(1.7)

%

Operating revenue, operating income and adjusted EBITDA decreased in the March 2017 quarter and fiscal year 2017 primarily due to the impact of the downturn in the oil and gas industry and the negative impact of changes in foreign currency exchange rates. Partially offsetting these decreases was an increase in operating revenue from increased activity in Norway. Eastern Airways contributed $24.5 million and $39.2 million in operating revenue and a negative $4.3 million and negative $0.7 million in adjusted EBITDA for the March 2017 and 2016 quarters, respectively, and $110.4 million and $133.5 million in operating revenue and a negative $4.5 million and positive $13.6 million in adjusted EBITDA for fiscal years 2017 and 2016, respectively.

A substantial portion of our revenue in the Europe Caspian region is contracted in British pound sterling, which depreciated significantly against the U.S. dollar in late June 2016 as a result of Brexit. Translation of results at lower British pound sterling exchange rates decreased operating revenue, operating income and adjusted EBITDA by $16.9 million, $6.0 million and $4.0 million, respectively, for the March 2017 quarter compared to the March 2016 quarter and $79.4 million, $26.7 million and $35.1 million, respectively, for fiscal year 2017 compared to fiscal year 2016.

The decrease in operating margin for fiscal year 2017 and the decrease in adjusted EBITDA margin for the March 2017 quarter and fiscal year 2017 compared to the prior year periods is primarily a result of the impact from the downturn in the offshore energy industry, which was only partially offset by the start-up of the U.K. SAR bases and cost reduction activities.

Africa



Three Month Period


Full Year



FY2017


FY2016


% Change


FY2017


FY2016


% Change
















(in thousands, except percentages)

Operating revenue


$

47,049



$

46,660



0.8

%


$

200,104



$

249,545



(19.8)

%

Earnings from unconsolidated affiliates


$

2,025



$

2,025



%


$

2,068



$

2,068



%

Operating income (loss)


$

10,225



$

(5,201)



296.6

%


$

30,179



$

19,702



53.2

%

Operating margin


21.7

%


(11.1)

%


295.5

%


15.1

%


7.9

%


91.1

%

Adjusted EBITDA


$

12,203



$

5,519



121.1

%


$

51,553



$

60,371



(14.6)

%

Adjusted EBITDA margin


25.9

%


11.8

%


119.5

%


25.8

%


24.2

%


6.6

%

Rent expense


$

2,000



$

1,431



39.8

%


$

8,101



$

7,456



8.7

%

Operating revenue for Africa increased in the March 2017 quarter compared to the prior year period primarily due to the temporary operational suspension of our S-76 fleet in the March 2016 quarter. Operating revenue decreased in fiscal year 2017 primarily due to an overall decrease in activity. A majority of our revenue in our Africa region is contracted at fixed U.S. dollar rates, resulting in minimal exposure to the devalued Nigerian naira upon translation into U.S. dollars for reporting purposes. We began providing fixed wing services in Africa which generated $4.2 million of operating revenue for fiscal year 2017 which partially offset the decline in helicopter activity.

Operating income and operating margin increased in the March 2017 quarter and fiscal year 2017 primarily due to a decrease in depreciation and amortization expense and lower operating expenses. Operating expenses were $3.4 million and $17.7 million lower in the March 2017 quarter and fiscal year 2017, respectively, due to the devaluation of the Nigerian naira which resulted in naira-based expenses translating into fewer U.S. dollars. Operating income and adjusted EBITDA in the March 2017 quarter benefited $2.0 million and $0.5 million, respectively, and for fiscal year 2017 benefited $13.5 million and $13.7 million, respectively, from changes in foreign currency exchange rates due to the combination of currencies our Nigerian operations transact in.

Adjusted EBITDA declined in fiscal year 2017 as the impact of decreased revenue was only partially offset by cost reduction activities and the favorable exchange rate impact compared to fiscal year 2016. The increase of operating margin and adjusted EBITDA margin is primarily related to the reduction of operating expense due to the devaluation of the Nigerian naira and cost reduction activities, partially offset by the reduction in revenue due to the downturn of the oil and gas industry.

Americas



Three Month Period


Full Year



FY2017


FY2016


% Change


FY2017


FY2016


% Change
















(in thousands, except percentages)

Operating revenue


$

51,966



$

65,016



(20.1)

%


$

220,544



$

290,299



(24.0)

%

Earnings from unconsolidated affiliates


$

613



$

(357)



271.7

%


$

5,207



$

(2,117)



346.0

%

Operating income (loss)


$

(1,566)



$

4,180



(137.5)

%


$

4,224



$

34,463



(87.7)

%

Operating margin


(3.0)

%


6.4

%


(146.9)

%


1.9

%


11.9

%


(84.0)

%

Adjusted EBITDA


$

5,635



$

11,529



(51.1)

%


$

39,952



$

71,958



(44.5)

%

Adjusted EBITDA margin


10.8

%


17.7

%


(39.0)

%


18.1

%


24.8

%


(27.0)

%

Rent expense


$

6,757



$

4,800



40.8

%


$

23,015



$

21,016



9.5

%

Operating revenue declined for the March 2017 quarter and fiscal year 2017 compared to the prior year periods primarily due to the decline in activity in our U.S. Gulf of Mexico operations.

Operating income, operating margin, adjusted EBITDA and adjusted EBITDA margin decreased in the March 2017 quarter and fiscal year 2017 compared to the prior year periods primarily due to the decline in activity, partially offset by a decrease in maintenance expense and salaries and benefits due to cost reduction initiatives. Our earnings from unconsolidated affiliates was impacted by foreign currency exchange rate changes, which reduced earnings from our investment in Líder by $0.6 million, $5.2 million, $3.2 million and $22.4 million for the March 2017 quarter, March 2016 quarter, fiscal year 2017 and fiscal year 2016, respectively.

Asia Pacific



Three Month Period


Full Year



FY2017


FY2016


% Change


FY2017


FY2016


% Change
















(in thousands, except percentages)

Operating revenue


$

62,628



$

57,877



8.2

%


$

217,772



$

272,054



(20.0)

%

Operating income (loss)


$

3,610



$

(710)



608.5

%


$

(20,870)



$

4,073



(612.4)

%

Operating margin


5.8

%


(1.2)

%


583.3

%


(9.6)

%


1.5

%


(740.0)

%

Adjusted EBITDA


$

5,487



$

6,197



(11.5)

%


$

(5,026)



$

28,361



(117.7)

%

Adjusted EBITDA margin


8.8

%


10.7

%


(17.8)

%


(2.3)

%


10.4

%


(122.1)

%

Rent expense


$

10,956



$

9,223



18.8

%


$

39,759



$

37,053



7.3

%

Operating revenue increased in the March 2017 quarter compared to the March 2016 quarter primarily due to the early cancellation of a contract resulting in an additional $17.2 million of operating revenue earned in the March 2017 quarter, partially offset by a decline in oil and gas activity. Operating revenue declined for fiscal year 2017 compared to fiscal year 2016 primarily due to a decline in oil and gas activity, partially offset by an increase due to the additional operating revenue from the early contract cancellation in fiscal year 2017.

Airnorth contributed $17.2 million and $14.3 million in operating revenue and a negative $0.7 million and positive $2.4 million in adjusted EBITDA for the March 2017 and 2016 quarters, respectively, and $77.1 million and $75.4 million in operating revenue and $7.1 million and $12.4 million in adjusted EBITDA for fiscal years 2017 and 2016, respectively.

Adjusted EBITDA and adjusted EBITDA margin declined for the March 2017 quarter and fiscal year 2017 compared to the prior year periods primarily due to a decline in oil and gas revenue which was only partially offset by cost reduction efforts and the contract cancellation billing in March 2017.

Corporate and other



Three Month Period


Full Year



FY2017


FY2016


% Change


FY2017


FY2016


% Change
















(in thousands, except percentages)

Operating revenue


$

2,452



$

4,945



(50.4)

%


$

10,369



$

23,487



(55.9)

%

Earnings from unconsolidated affiliates


$

(142)



$



*


$

(603)



$



*

Operating loss


$

(25,747)



$

(23,518)



(9.5)

%


$

(104,616)



$

(118,796)



11.9

%

Adjusted EBITDA


$

(21,528)



$

(16,386)



(31.4)

%


$

(60,558)



$

(79,119)



23.5

%

Rent expense


$

1,940



$

2,624



(26.1)

%


$

7,661



$

9,938



(22.9)

%


_______________


*

percentage change too large to be meaningful or not applicable

Operating revenue decreased in the March 2017 quarter and fiscal year 2017 compared to prior periods primarily due to a decline in Bristow Academy revenue.

While operating loss remained relatively flat, adjusted EBITDA decreased for the March 2017 quarter compared to the prior year period primarily due to a decline in the favorable impact from changes in foreign currency exchange rates of $3.4 million and the decrease in Bristow Academy revenue. Operating loss and adjusted EBITDA improved for fiscal year 2017 compared to the prior year primarily due to cost reduction initiatives including lower compensation expense and professional fees and a favorable impact from changes in foreign currency exchange rates on our Corporate results of $10.9 million compared to fiscal year 2016.

DIVIDEND

On May 18, 2017, our Board of Directors approved a dividend of $0.07 per share to be paid on June 22, 2017 to shareholders of record on June 7, 2017. Based on the number of shares outstanding as of March 31, 2017, the total quarterly dividend payment will be approximately $2.5 million.

OUTLOOK

We expect fiscal year 2018 results to be impacted by the continued offshore oil and gas industry downturn. Industry conditions in the March 2017 quarter are expected to continue into fiscal year 2018. However, fiscal year 2018 results are expected to be better than our annualized fourth quarter fiscal year 2017 results as we anticipate sequential quarterly improvement beginning in the second half of fiscal year 2018 as new contracts commence.

Our liquidity of $357 million as of March 31, 2017 is expected to decrease during fiscal year 2018, but we expect liquidity as of March 31, 2018 to still be in excess of $200 million as a result of the net impact of previously announced capex eliminations/deferrals and financings and debt repayments.

Additionally, our focus on continued cost elimination, recovering costs from OEMs, and lower net capex should further improve liquidity. Guidance for selected financial measures will be provided in the investor slide presentation during tomorrow's conference call.

CONFERENCE CALL

Management will conduct a conference call starting at 10:00 a.m. ET (9:00 a.m. CT) on Wednesday, May 24, 2017 to review financial results for the fiscal year 2017 fourth quarter ended March 31, 2017.  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 2017 Fourth 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 June 7, 2017 and may be accessed by calling toll free 1-877-660-6853, passcode: 13661548#

Via Telephone outside the U.S.:

  • Live: Dial 1-412-902-0030
  • Replay: A telephone replay will be available through June 7, 2017 and may be accessed by calling 1-201-612-7415, passcode: 13661548#

ABOUT BRISTOW GROUP INC.

Bristow Group Inc. is the leading global industrial aviation services provider offering helicopter transportation, search and rescue (SAR) and aircraft support services, including maintenance and training, to government and civil organizations worldwide. Bristow has major 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. Bristow provides SAR services to the private sector worldwide and to the public sector for all of the U.K. on behalf of the Maritime and Coastguard Agency. For more information, visit 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 industrial aviation 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, 2016 and annual report on Form 10-K for the fiscal year ended March 31, 2016.  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

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts and percentages)

(Unaudited)






Three Month Period


Full Year


FY2017


FY2016


FY2017


FY2016









Gross revenue:








Operating revenue from non-affiliates

$

306,595



$

357,636



$

1,276,374



$

1,550,638


Operating revenue from affiliates

17,056



17,632



71,476



78,909


Reimbursable revenue from non-affiliates

12,543



6,451



52,652



85,966



336,194



381,719



1,400,502



1,715,513










Operating expense:








Direct cost

272,468



301,163



1,103,984



1,227,541


Reimbursable expense

12,217



5,582



50,313



81,824


Depreciation and amortization

25,694



29,959



118,748



136,812


General and administrative

46,089



50,343



195,367



224,645



356,468



387,047



1,468,412



1,670,822










Loss on impairment



(27,391)



(16,278)



(55,104)


Loss on disposal of assets

(1,422)



(6,837)



(14,499)



(30,693)


Earnings from unconsolidated affiliates, net of losses

2,168



1,633



6,945



261










Operating loss

(19,528)



(37,923)



(91,742)



(40,845)


Interest expense, net

(15,386)



(9,744)



(49,919)



(34,128)


Other income (expense), net

(1,123)



2,677



(2,641)



(4,258)


Loss before provision for income taxes

(36,037)



(44,990)



(144,302)



(79,231)


Benefit (provision) for income taxes

(43,626)



11,582



(32,588)



2,082


Net loss

(79,663)



(33,408)



(176,890)



(77,149)


Net loss attributable to noncontrolling interests

1,623



8,153



6,354



4,707


Net loss attributable to Bristow Group

(78,040)



(25,255)



(170,536)



(72,442)


Accretion of redeemable noncontrolling interests







(1,498)


Net loss attributable to common stockholders

$

(78,040)



$

(25,255)



$

(170,536)



$

(73,940)










Loss per common share:








Basic

$

(2.22)



$

(0.72)



$

(4.87)



$

(2.12)


Diluted

$

(2.22)



$

(0.72)



$

(4.87)



$

(2.12)


















Non-GAAP measures:








Adjusted EBITDA

$

3,687



$

35,300



$

71,084



$

205,523


Adjusted EBITDA margin

1.1

%


9.4

%


5.3

%


12.6

%

Adjusted net income (loss)

$

(40,302)



$

4,716



$

(74,525)



$

51,308


Adjusted diluted earnings (loss) per share

$

(1.15)



$

0.13



$

(2.13)



$

1.45


 

BRISTOW GROUP INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)




March 31,


2017


2016

ASSETS

Current assets:




Cash and cash equivalents

$

96,656



$

104,310


Accounts receivable from non-affiliates

198,129



243,425


Accounts receivable from affiliates

8,786



5,892


Inventories

124,911



142,503


Assets held for sale

38,246



43,783


Prepaid expenses and other current assets

41,143



53,183


   Total current assets

507,871



593,096


Investment in unconsolidated affiliates

210,162



194,952


Property and equipment – at cost:




Land and buildings

231,448



253,098


Aircraft and equipment

2,622,701



2,570,577



2,854,149



2,823,675


Less – Accumulated depreciation and amortization

(599,785)



(540,423)



2,254,364



2,283,252


Goodwill

19,798



29,990


Other assets

121,652



161,655


Total assets

$

3,113,847



$

3,262,945






LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND STOCKHOLDERS' INVESTMENT

Current liabilities:




Accounts payable

$

98,215



$

96,966


Accrued wages, benefits and related taxes

59,077



59,431


Income taxes payable

15,145



27,400


Other accrued taxes

9,611



7,995


Deferred revenue

19,911



24,206


Accrued maintenance and repairs

22,914



22,196


Accrued interest

12,909



11,985


Other accrued liabilities

46,679



48,392


Deferred taxes

830



1,881


Short-term borrowings and current maturities of long-term debt

131,063



60,394


Contingent consideration



29,522


   Total current liabilities

416,354



390,368


Long-term debt, less current maturities

1,150,956



1,071,578


Accrued pension liabilities

61,647



70,107


Other liabilities and deferred credits

28,899



33,273


Deferred taxes

154,873



172,254


Redeemable noncontrolling interest

6,886



15,473


Stockholders' investment:




Common stock

379



377


Additional paid-in capital

809,995



801,173


Retained earnings

991,906



1,172,273


Accumulated other comprehensive loss

(328,277)



(289,819)


Treasury shares, at cost

(184,796)



(184,796)


Total Bristow Group stockholders' investment

1,289,207



1,499,208


Noncontrolling interests

5,025



10,684


Total stockholders' investment

1,294,232



1,509,892


Total liabilities, redeemable noncontrolling interest and stockholders' investment

$

3,113,847



$

3,262,945


 

BRISTOW GROUP INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)




Full Year


FY2017


FY2016

Cash flows from operating activities:




Net loss

$

(176,890)



$

(77,149)


Adjustments to reconcile net loss to net cash provided by operating activities:




Depreciation and amortization

118,748



136,812


Deferred income taxes

15,720



(51,643)


Write-off of deferred financing fees

923




Discount amortization on long-term debt

1,606



1,000


Loss on disposal of assets

14,499



30,693


Loss on impairment

16,278



55,104


Stock-based compensation

12,352



21,181


Equity in earnings from unconsolidated affiliates less than (in excess of) dividends received

(4,438)



2,619


Increase (decrease) in cash resulting from changes in:




Accounts receivable

23,759



46,608


Inventories

(1,958)



(3,380)


Prepaid expenses and other assets

1,267



493


Accounts payable

15,052



13,316


Accrued liabilities

(19,713)



(34,035)


Other liabilities and deferred credits

(6,503)



(25,593)


Net cash provided by operating activities

10,702



116,026


Cash flows from investing activities:




Capital expenditures

(135,110)



(372,375)


Proceeds from asset dispositions

18,471



60,035


Investment in unconsolidated affiliates



(4,410)


Deposit received on aircraft held for sale

290




Net cash used in investing activities

(116,349)



(316,750)


Cash flows from financing activities:




Proceeds from borrowings

708,267



928,802


Payment of contingent consideration

(10,000)



(9,453)


Debt issuance costs

(8,010)



(5,139)


Repayment of debt and debt redemption premiums

(570,328)



(677,003)


Partial prepayment of put/call obligation

(49)



(55)


Acquisition of noncontrolling interest



(7,309)


Dividends paid to noncontrolling interest

(2,533)



(153)


Common stock dividends paid

(9,831)



(38,076)


Net cash provided by financing activities

107,516



191,614


Effect of exchange rate changes on cash and cash equivalents

(9,523)



9,274


Net increase (decrease) in cash and cash equivalents

(7,654)



164


Cash and cash equivalents at beginning of period

104,310



104,146


Cash and cash equivalents at end of period

$

96,656



$

104,310


 

BRISTOW GROUP INC. AND SUBSIDIARIES

SELECTED OPERATING DATA

(In thousands, except flight hours and percentages)

(Unaudited)








Three Month Period


Full Year



FY2017


FY2016


FY2017


FY2016

Flight hours (excluding Bristow Academy and unconsolidated affiliates):









Europe Caspian


20,203



20,633



85,906



90,260


Africa


6,704



5,921



29,573



33,111


Americas


6,151



7,257



23,655



36,841


Asia Pacific


6,359



7,025



26,118



31,638


Consolidated


39,417



40,836



165,252



191,850











Operating revenue:









Europe Caspian


$

162,511



$

206,517



$

710,581



$

809,914


Africa


47,049



46,660



200,104



249,545


Americas


51,966



65,016



220,544



290,299


Asia Pacific


62,628



57,877



217,772



272,054


Corporate and other


2,452



4,945



10,369



23,487


Intra-region eliminations


(2,955)



(5,747)



(11,520)



(15,752)


Consolidated


$

323,651



$

375,268



$

1,347,850



$

1,629,547











Operating income (loss):









Europe Caspian


$

(4,628)



$

(5,837)



$

13,840



$

50,406


Africa


10,225



(5,201)



30,179



19,702


Americas


(1,566)



4,180



4,224



34,463


Asia Pacific


3,610



(710)



(20,870)



4,073


Corporate and other


(25,747)



(23,518)



(104,616)



(118,796)


Loss on disposal of assets


(1,422)



(6,837)



(14,499)



(30,693)


Consolidated


$

(19,528)



$

(37,923)



$

(91,742)



$

(40,845)











Operating margin:









Europe Caspian


(2.8)

%


(2.8)

%


1.9

%


6.2

%

Africa


21.7

%


(11.1)

%


15.1

%


7.9

%

Americas


(3.0)

%


6.4

%


1.9

%


11.9

%

Asia Pacific


5.8

%


(1.2)

%


(9.6)

%


1.5

%

Consolidated


(6.0)

%


(10.1)

%


(6.8)

%


(2.5)

%










Adjusted EBITDA:









Europe Caspian


$

1,890



$

28,441



$

45,163



$

123,952


Africa


12,203



5,519



51,553



60,371


Americas


5,635



11,529



39,952



71,958


Asia Pacific


5,487



6,197



(5,026)



28,361


Corporate and other


(21,528)



(16,386)



(60,558)



(79,119)


Consolidated


$

3,687



$

35,300



$

71,084



$

205,523











Adjusted EBITDA margin:









Europe Caspian


1.2

%


13.8

%


6.4

%


15.3

%

Africa


25.9

%


11.8

%


25.8

%


24.2

%

Americas


10.8

%


17.7

%


18.1

%


24.8

%

Asia Pacific


8.8

%


10.7

%


(2.3)

%


10.4

%

Consolidated


1.1

%


9.4

%


5.3

%


12.6

%













Three Month Period


Full Year



FY2017


FY2016


FY2017


FY2016

Depreciation and amortization:









Europe Caspian


$

5,917



$

11,620



$

39,511



$

41,509


Africa


3,984



5,063



16,664



29,337


Americas


7,058



7,848



32,727



36,371


Asia Pacific


5,505



3,081



19,091



20,526


Corporate and other


3,230



2,347



10,755



9,069


Consolidated


$

25,694



$

29,959



$

118,748



$

136,812











Rent expense:









Europe Caspian


$

34,065



$

33,267



$

134,072



$

136,377


Africa


2,000



1,431



8,101



7,456


Americas


6,757



4,800



23,015



21,016


Asia Pacific


10,956



9,223



39,759



37,053


Corporate and other


1,940



2,624



7,661



9,938


Consolidated


$

55,718



$

51,345



$

212,608



$

211,840


 

BRISTOW GROUP INC. AND SUBSIDIARIES

AIRCRAFT COUNT

As of March 31, 2017

(Unaudited)











Aircraft in Consolidated Fleet





Percentage

of FY2017

Operating

Revenue


Helicopters







Small


Medium


Large


Training


Fixed

Wing (1)


Total (2)(3)


Unconsolidated

Affiliates (4)






Total

Europe Caspian

53

%




16



78





31



125





125


Africa

15

%


14



28



5





5



52



46



98


Americas

16

%


14



41



18







73



65



138


Asia Pacific

16

%


3



10



24





14



51





51


Corporate and other

%








47





47





47


Total

100

%


31



95



125



47



50



348



111



459


Aircraft not currently in fleet: (5)

















On order





5


27






32




Under option







4






4





_______________



(1)

Includes 31 fixed wing aircraft operated by Eastern Airways which are included in the Europe Caspian region, three fixed wing aircraft Eastern Airways provides technical support for in our Africa region and 14 fixed wing aircraft operated by Airnorth which are included in the Asia Pacific region.



(2)

Includes 20 aircraft held for sale and 122 leased aircraft as follows:

 



Held for Sale Aircraft in Consolidated Fleet



Helicopters







Small


Medium


Large


Training


Fixed

Wing


Total

Europe Caspian




2









2


Africa


5



4









9


Americas




5









5


Asia Pacific










1



1


Corporate and other








3





3


Total


5



11





3



1



20

















Leased Aircraft in Consolidated Fleet



Helicopters







Small


Medium


Large


Training


Fixed

Wing


Total

Europe Caspian




6



39





13



58


Africa




1



2





2



5


Americas


1



14



8







23


Asia Pacific


3



3



9





4



19


Corporate and other








17





17


Total


4



24



58



17



19



122




(3)

The average age of our fleet, excluding training aircraft, was nine years as of March 31, 2017.



(4)

The 111 aircraft operated by our unconsolidated affiliates do not include those aircraft leased to us. Includes 43 helicopters (primarily medium) and 22 fixed wing aircraft owned and managed by Líder, our unconsolidated affiliate in Brazil, which is included in our Americas region, and 39 helicopters and seven fixed wing aircraft owned by Petroleum Air Services ("PAS"), our unconsolidated affiliate in Egypt, which is included in our Africas region.



(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
(Unaudited)

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 auditor.  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 Month Period


Full Year



FY2017


FY2016


FY2017


FY2016












(In thousands, except per share amounts and percentages)

Net loss


$

(79,663)



$

(33,408)



$

(176,890)



$

(77,149)


Loss on disposal of assets


1,422



6,837



14,499



30,693


Special items


(3,084)



33,311



31,277



82,063


Depreciation and amortization


25,694



29,959



118,748



136,812


Interest expense


15,692



10,183



50,862



35,186


Provision (benefit) for income taxes


43,626



(11,582)



32,588



(2,082)


Adjusted EBITDA


$

3,687



$

35,300



$

71,084



$

205,523











Benefit (provision) for income taxes


$

(43,626)



11,582



$

(32,588)



$

2,082


Tax benefit on loss on disposal of asset


(618)



(3,178)



(6,476)



(8,665)


Tax provision (benefit) on special items


38,923



(10,629)



49,342



(8,996)


Adjusted benefit (provision) for income taxes


$

(5,321)



$

(2,225)



$

10,278



$

(15,579)











Effective tax rate (1)


(121.1)

%


25.7

%


(22.6)

%


2.6

%

Adjusted effective tax rate (1)


(14.5)

%


(183.6)

%


11.7

%


25.1

%










Net loss attributable to Bristow Group


$

(78,040)



$

(25,255)