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Q2 AND FY 2015 EARNINGS CALL – Bristow Group

Bristow Group · Nov 7, 2014 · 50 slides

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Slides

  1. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 1
    Second quarter FY15 earnings presentation Bristow Group Inc. November 7, 2014
  2. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 2
    Second quarter FY15 earnings call agenda Introduction Linda McNeill, Director Investor Relations CEO remarks and safety review Jonathan Baliff, President and CEO Operational highlights Jeremy Akel, SVP and COO Current and future…
  3. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 3
    CEO remarks and safety review Jonathan Baliff, President and CEO
  4. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 4
    Operational safety review Commercial Air Accident Rate1 (AAR) per 100,000 Total Recordable Injury Rate2 (TRIR) per 200,000 flight hours (fiscal year) man hours (cumulative) 3.00 3.00 2.00 2.00 0.96 1.00 1.00 0.54 0.53 0.53…
  5. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 5
    Q2 FY15 highlights Q2 operating revenue of 440.5M (16.3% increase from Q2 FY14, 0.7 % increase from Q1 FY15) Q2 GAAP EPS of 0.73 (75.7% decrease from Q2 FY14, 40.7% decrease from Q1 FY15) Q2 adjusted EPS* of 0.87 (31.5% decrease…
  6. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 6
    Market environment outlook Recent declines in oil prices are supply oriented and expected to be shorter term in nature, with increased finding/production costs supporting a sustainable higher price in the long term Regardless, our…
  7. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 7
    Operational highlights Jeremy Akel, SVP and COO
  8. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 8
    Europe (EBU) Europe contributed 49% of Bristow operating revenue and 54% of adjusted EBITDAR* in Q2 FY15 Operating revenue increased 32% to 206.3M in Q2 FY15 from 156.4M in Q2 FY14 with the net addition of eight LACE, an overall…
  9. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 9
    UK SAR update From the start of the GAP SAR contract in June 1, 2013 through September 30, 2014, we have conducted over 445 missions and rescued and/or assisted over 420 people Sumburgh and Stornoway bases generated 13.0M of…
  10. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 10
    West Africa (WASBU) West Africa (Nigeria) contributed 19% of Bristow operating revenue and 19% of adjusted EBITDAR* in Q2 FY15 Operating revenue increased to 80.1M in Q2 FY15 from 75.9M in Q2 FY14 due to improved contract terms…
  11. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 11
    North America (NABU) North America contributed 13% of Bristow operating revenue and 14% of adjusted EBITDAR* in Q2 FY15 Operating revenue decreased slightly to 56.0M in Q2 FY15 from 60.4M in Q2 FY14 primarily due to the planned…
  12. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 12
    Australia (AUSBU) Australia contributed 11% of Bristow operating revenue and 8% of adjusted EBITDAR* in Q2 FY15 Operating revenue increased by 33.6% to 47.2M in Q2 FY15 from 35.3M in Q2 FY14 Adjusted EBITDAR increased 44.2% to…
  13. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 13
    Other International (OIBU) Other International contributed 8% of Bristow operating revenue and 5% of adjusted EBITDAR* in Q2 FY15 Operating revenue increased to 35.8M in Q2 FY15 vs. 32.2M in Q2 FY14 due to addition of a contract in…
  14. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 14
    Lder update YTD CY14 adjusted EBITDAR decreased 8.5% year-over-year due primarily due to unfavorable changes in foreign currency rates Absolute BVA contribution to Bristow from Lder was 3.9M* in Q2 FY15 (September 30, 2014)…
  15. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 15
    Current and future financial performance John Briscoe, SVP and CFO
  16. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 16
    Financial highlights: Adjusted EPS and adjusted EBITDAR summary year-over-year Q2 FY14 to Q2 FY15 adjusted EPS bridge 0.04 0.33 0.11 1.27 0.87 Q2 FY14 Operations Corporate and Other FX Changes Q2 FY15 Q2 FY14 to Q2…
  17. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 17
    LACE and LACE rate continue to increase led by new technology aircraft and improved utilization/terms Consolidated commercial aircraft Large Aircraft Equivalent (LACE)* 300 279 264 261 180 LACE* LACE Rate* ( in millions) 12 241…
  18. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 18
    Financial highlights: Adjusted EPS and adjusted EBITDAR summary year-over-year YTD Q2 FY14 to YTD Q2 FY15 adjusted EPS bridge 0.24 0.02 0.35 2.28 2.19 YTD Q2 FY14 Operations Corporate and Other FX Changes YTD Q2 FY15…
  19. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 19
    Bristow Value Added (BVA) drives improving Gross Cash Flow (GCF) performance 14.0% 70.0 13.0% 13.1% 12.0% 60.0 12.4% 11.8% 11.8% 10.0% TTM GCF reutrn % BVA in millions 50.0 8.0% 40.0 28.7 6.0% 30.0 24.5 26.1 22.4…
  20. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 20
    Our progress on BVA yields stronger liquidity for growth, dividends and share repurchases . . . Net cash provided by operating activities1 700 Total liquidity2 300 267 613 600 250 231 232 530 500 264 200 132 in millions…
  21. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 21
    FY15 guidance reaffirmed . . . FY15 adjusted EPS guidance range is reaffirmed at 4.70 - 5.20, excluding special items and aircraft sales. Other specific items include: FY15 guidance Average LACE (Large AirCraft 161 - 167 Interest…
  22. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 22
    . . . as we continue to deliver strong results in FY15 Declines in recent oil prices have not impacted our production and infrastructure oriented business model We continue to work with clients to identify cost effective logistics…
  23. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 23
    Appendix
  24. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 24
    Organizational chart - as of September 30, 2014 Bristow EBU WASBU NABU AUSBU OIBU BRS Academy 46% 18% 13% 11% 8% 4%* UK 85/6 Nigeria 47/6 U.S. GoM 59/6 Australia 29/12 Brazil 11/5 Florida 54/1 Norway 21/4 Canada 8/2 Egypt 0/0…
  25. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 25
    Aircraft fleet medium and large as of September 30, 2014 Aircraft Type No. of PAX Engine Consl Unconsl Total Ordered Large Helicopters Large capacity 16-25 passengers AS332 L Super Puma 18 Twin Turbine 18 - 18 - AW189 16 Twin Turbine…
  26. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 26
    Aircraft fleet small, training and fixed as of September 30, 2014 (continued) Aircraft Type No. of PAX Engine Consl Unconsl Total Ordered Small capacity 4-7 passengers Small Helicopters AW109 6 Twin Turbine - 1 1 AS 350BB 4 Turbine…
  27. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 27
    Operating lease strategy: lowering the cost and amount of capital needed to grow Leased aircraft as of September 30, 2014 Small Medium Large Total Leased LACE Total LACE % Leased EBU - 1 35 36 36 67 53% WASBU - 1 1 2 2 23 7% NABU…
  28. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 28
    Consolidated fleet changes and aircraft sales for Q2 FY15 Fleet changes Held for sale aircraft in consolidated fleet Small Medium Large Training Total Q1 FY15 Q2 FY15 Fleet Count Beginning 363 363 EBU - - 5 - 5 Delivered WASBU - 2…
  29. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 29
    Operating revenue, LACE and LACE rate by BU Operating Revenue, LACE, and LACE Rate by BU as of September 30, 2014 1 2,3 Op revenue LACE LACE Rate EBU 328 67 9.78 WASBU 160 23 14.23 NABU 113 32 7.04 AUSBU 94 22 8.72 OIBU 71…
  30. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 30
    Historical LACE by BU LACE FY10 FY11 FY12 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 EBU 45 45 45 42 42 43 48 46 44 46 46 45 WASBU 23 23 24 25 24 24 21 22 23 22 22 22 NABU 39 36 36 36 39 35 34 29 30 29 30 30 AUSBU 20 20 22 22 20 23 24…
  31. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 31
    Historical LACE rate by BU 1,2 LACE Rate FY10 FY11 FY12 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 EBU 8.36 8.28 8.40 8.76 8.20 8.50 7.90 8.40 9.80 9.60 9.63 10.09 WASBU 9.08 8.81 8.66 8.34 9.70 9.40 10.70 9.90 9.10 10.30 11.17 11.46…
  32. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 32
    Order and options book as of September 30, 2014 1 OPTIONS BOOK ORDER BOOK Helicopter Helicopter Class Delivery Date Class Delivery Date Location Contracted 1 Large September 2015 1 Large December-14 AUSBU 1 of 1 1 Large…
  33. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 33
    Order and options book as of September 30, 2014 (continued) UK SAR CONFIGURED ORDER BOOK Helicopter Class Delivery Date Location Contracted 1 Large December-14* EBU 1 of 1 2 Large December-14 EBU 2 of 2 3 Large March-15 EBU 3 of…
  34. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 34
    Total net asset FMV with and without leased aircraft FMV 95 Net asset FMV per share Book value of equity per share Average stock price 87.99 85 76.55 75 70.12 65 55 53.79 49.19 45 35 NOTE: The gray shaded…
  35. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 35
    Net asset FMV reconciliation as of September 30, 2014 September 30, 2014 (in millions) Including leases Excluding leases (+) FMV of a/c 1,829 1,829 (+) FMV of leased a/c 1,415 - (+) NBV of PPE w/o a/c 581 581 (+) Working capital…
  36. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 36
    UK SAR net asset FMV reconciliation UK SAR contribution (in millions) September 30, 2014 FY16 - FY17 Implied (+) FMV of a/c 1,829 79 1,908 (+) FMV of leased a/c 1,415 289 1,704 (+) NBV of PPE w/o a/c 581 113 694 (+) Working…
  37. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 37
    Adjusted EBITDAR margin* trend FY12 FY13 Q1 Q2 Q3 Q4 Full Year Q1 Q2 Q3 Q4 Full Year EBU 33.0% 31.4% 30.7% 36.1% 32.9% 32.2% 34.6% 39.5% 38.3% 36.2% WASBU 29.5% 35.5% 37.2% 36.6% 35.0% 31.9% 26.5% 35.0% 31.8% 31.5% NABU 14.3% 20.6%…
  38. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 38
    Adjusted EBITDAR* reconciliation Fiscal year ended, 3/31/2012 3/31/2013 ( in millions) Q1 Q2 Q3 Q4 FY12 Q1 Q2 Q3 Q4 FY13 Net income 21 3 26 15 65 24 30 37 40 132 Income tax expense 7 -2 7 2 14 6 8 8 13 35 Interest expense 9 9 10…
  39. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 39
    Bristow Value Added (BVA) Sample calculation for Q2 FY15 and Q2 FY14 Bristow Value Added = Gross Cash Flow (Gross Operating Assets X Capital Charge) BVA = GCF - ( GOA X 10.5%** ) Bristow Value Added calculation for Q2 FY15…
  40. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 40
    Bristow gross cash flow reconciliation (in millions) Gross cash flow reconciliation Q2 FY14 Q2 FY15 Net income 111 26 Depreciation and amortization 24 28 Interest expense 9 8 Interest income (1) (0) Rent 23 35 Other…
  41. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 41
    Bristow adjusted gross operating assets reconciliation (in millions) Adjusted gross operating assets reconciliation Q2 FY14 Q2 FY15 Total assets 3,166 3,280 Accumulated depreciation 518 511 Capitalized operating leases 373 610 Cash…
  42. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 42
    Lder Bristow Value Added (BVA) Sample calculation for Q2 FY15 and Q2 FY14 Bristow Value Added = Gross Cash Flow (Gross Operating Assets X Capital Charge) BVA = GCF - ( GOA X 10.5%** ) Bristow Value Added calculation for Q2 FY15…
  43. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 43
    Lder gross cash flow reconciliation ( in millions) Gross cash flow reconciliation Q2 FY14 Q2 FY15 Net income (loss) 22.1 11.7 Depreciation and amortization 4.1 3.5 Rent 6.6 7.3 Interest expense 3.7 4.1 Interest income (0.9)…
  44. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 44
    Lder adjusted gross operating assets reconciliation ( in millions) Adjusted gross operating assets reconciliation Q2 FY14 Q2 FY15 Total assets 595.2 641.7 Cash and cash equivalents (98.2) (64.5) Accumulated depreciation 71.8 85.8…
  45. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 45
    Lder's adjusted EBITDAR* reconciliation ( in millions) Q3 CY13 Q4 CY13 Q1 CY14 Q2 CY14 Q3 CY14 Gross revenue 116.8 119.3 121.2 113.7 116.4 (-) Revenue deductions (6.6) (7.6) (5.9) (7.3) (7.7) Net operating revenue 110.2 111.3 115.3…
  46. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 46
    GAAP reconciliation (i) See information about special items in 10-Q or earnings release for Q2 FY15 (ii) These amounts are presented after applying the appropriate tax effect to each item and dividing by the weighted average shares…
  47. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 47
    Bristow leverage reconciliation Debt Investment Capital Leverage (a) (b) (c) = (a) + (b) (a) / (c) (in millions) As of September 30, 2014 779.5 1,757.5 2,537.0 30.7% Adjust for: Unfunded Pension Liability 71.8 71.8 NPV of…
  48. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 48
    Lder leverage reconciliation (in millions) Sep13 Sep14 Total book debt 279 317 NPV of leases 75 51 Total adjusted debt 354 368 TTM adjusted EBITDAR 125 115 Adjusted debt / TTM adj. EBITDAR 2.8x 3.2x 49
  49. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 49
    FY15 guidance FY15 guidance as of June 30, 2014 Average LACE (Large AirCraft 161 - 167 Interest expense 30 - 35M Equivalent) Average LACE Rate 9.50 - 10.50M Rent expense (a/c only) 137 - 142M G & A expense (all inclusive) 190 -…
  50. Q2 AND FY 2015 EARNINGS CALL – Bristow Group – slide 50
    Contact us Bristow Group Inc. (NYSE: BRS) 2103 City West Blvd., 4th Floor Houston, Texas 77042 t 713.267.7600 f 713.267.7620 bristowgroup.com 51

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