Bristow Group reports financial results for its 2011 third fiscal quarter and nine-month period ended December 31, 2010

Bristow Group reported a 57% increase in net income for the three months ended December 31, 2010 to $41.8 million, or $1.13 per diluted share, compared to $26.7 million, or $0.74 per diluted share, in the December 2009 quarter. 

The quarter benefited from year-over-year improvement in the underlying operations and a significant reduction in our effective tax rate primarily resulting from the reversal of deferred tax liabilities recorded in prior fiscal years, which was driven by a global restructuring of Bristow's operations as part of the continuing implementation of our global business strategy.

Revenue for the three months ended December 31, 2010 totaled $317.9 million compared to $303.3 million in the same period a year ago. 

Earnings before interest, taxes, depreciation and amortization ("EBITDA") totaled $65.6 million compared to $64.4 million in the December 2009 quarter.  Results benefited from revenue increases in the following business units: Other International (primarily Brazil, Suriname and Russia), Australia and Europe compared to the same quarter a year ago, primarily driven by the addition of new contracts and increases in both price and activity for certain customers.  These increases were partially offset by a lower level of gain (loss) on disposal of assets year-over-year.

Excluding the special items discussed below and the gain (loss) on disposal of assets, our operating income, EBITDA, net income and diluted earnings per share totaled $43.2 million, $64.4 million, $26.3 million and $0.71, respectively, for the three months ended December 31, 2010, and $39.0 million, $60.9 million, $23.8 million and $0.66, respectively, for the three months ended December 31, 2009.

"As we discussed last quarter, Bristow continued to see improvement in our operational results during our third fiscal quarter," said William E. Chiles, President and Chief Executive Officer of Bristow Group.  "The underlying performance of our business continues to be strong with improving operating margins year-over-year in a majority of our business units.  The amendment to our credit facility completed during the quarter almost doubles our liquidity position while lowering the overall cost of debt.  When combined with the commercial and tax benefits realized as a part of the recent reorganization, our financial results are demonstrating the benefit of the Bristow global team's efforts to deliver on our promises.

"As we go into the final quarter of this fiscal year, we continue to expect revenue and earnings per share for the current fiscal year to be stronger than fiscal year 2010 as additional newer-technology aircraft go to work for our customers and we focus on improving returns and lowering our after tax cost of capital.  We continue to anticipate a stronger second half compared to the first half of fiscal year 2011," Chiles added.

During the December 2010 quarter, we experienced a small loss on the sale of aircraft compared to gains during the December 2009 quarter of $2.4 million; however, we continue to see opportunities for sale of our aircraft in the aftermarket.

Our Europe business unit added three new customers, which along with higher equity earnings from our military training unconsolidated affiliate, FB Heliservices Limited, price escalations under existing contracts and renegotiated rates on contract renewals, increased our operating margin in this market.

Our North America business unit continued to benefit during the quarter from contracts with BP in the U.S. Gulf of Mexico despite a decline in the number of aircraft supporting well control and spill cleanup efforts from five at the end of September to three at the end of December.  This work mostly offset lost business from customers stalled by the deepwater moratorium, which has now been lifted.  A decrease in costs in this market resulted in a slight increase in operating margin.

Our West Africa business was impacted by the loss of a major customer in this market.  However, lower operating expense combined with the addition of new contracts, increased rates on existing contracts and fewer flight delay penalties resulted in improved operating margin.  We are continuing to seek permanent work to replace the earnings associated with the lost work with the major customer.

Our Australia business unit was impacted by higher compensation costs and increased depreciation expense, which despite a favorable impact from exchange rate changes, resulted in decreased operating earnings and margin.

Our Other International business unit's operating margin improved substantially as a result of increased revenue in Brazil, the Baltic Sea, Suriname, Ghana and Russia.  Additionally, our earnings from our affiliates in Brazil and Mexico improved over the prior year quarter.

Source: Bristow Group