Commercial

Bristow Says Offshore Sector Faces Unmatched Headwinds

By Staff Writer | November 10, 2015

Offshore helicopter support operators face economic challenges that are unmatched in their history, said Bristow Group President/CEO Jonathan Baliff. “This industry at its current scale has not faced this level of commercial, foreign exchange and financial market headwinds before,” said Baliff. Bristow reported financial results for the second quarter of its 2016 fiscal year that included a 96% plunge in adjusted net income (to $1.3 million compared to the quarter that ended Sept. 30, 2014, from $31.1 million). The adjustments included the exclusion of $37.6 million of special items and $10.8 million of losses on asset dispositions. Over that period, the company’s adjusted earnings before interest, taxes, depreciation, amortization and rent (EBITDAR) fell 17% to $92.8 million for the September 2015 quarter from $112.1 million for the same period a year ago. Bristow has seen clients “implement more supply chain efficiencies that curtailed our flight hours and triggered several contract terminations,” Baliff said. (Other offshore operators have seen the same.) Bristow’s adjusted EBITDAR was cut $30 million for the quarter, primarily by the 28% drop in the value of Brazilian real against the U.S. dollar. He also said that “the finance markets have also been challenged," adding that the company "has worked very hard to implement our economic restructuring initiatives” designed to enhance its competitive position and financial strength. That included agreements in principal with OEMs to defer about $100 million of aircraft capital obligations from this year into fiscal 2017, “with further deferrals expected for subsequent periods,” said Don Miller, Bristow’s senior vice president and chief financial officer. 

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