Era Group Inc. Reports Fourth Quarter and Full Year 2014 Results
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HOUSTON, TX -- (Marketwired) -- 03/10/15 -- Era Group Inc. (NYSE: ERA) today reported net income for its fourth quarter ended December 31, 2014 of $3.2 million, or $0.16 per diluted share, on operating revenues of $74.7 million compared to net income of $1.8 million, or $0.09 per diluted share, on operating revenues of $76.0 million in the prior year quarter. The Company also reported net income for its fiscal year ended December 31, 2014 of $17.1 million, or $0.84 per diluted share, on operating revenues of $331.2 million compared to net income of $18.7 million, or $0.88 per diluted share, on operating revenues of $299.0 million in the prior fiscal year.
Earnings before interest, taxes, depreciation and amortization ("EBITDA") was $18.6 million in the current quarter compared to $20.0 million in the prior year quarter. There were no significant gains on equipment dispositions in the current quarter compared to gains on asset dispositions of $0.5 million in the prior year quarter. EBITDA in the current quarter included $1.9 million of foreign currency losses compared to foreign currency gains of $0.2 million in the prior year quarter.
Fiscal year 2014 EBITDA was $85.9 million compared to EBITDA of $93.1 million in the prior fiscal year. EBITDA adjusted to exclude gains on asset dispositions and special items was $84.7 million in the current year compared to $77.0 million in the prior year. The Company sold helicopters and related equipment for gains of $6.1 million in the current year compared to gains of $18.3 million in the prior year. Special items in the current year consisted of $2.5 million in severance-related expenses for the Company's former Chief Executive Officer and a $2.5 million impairment charge related to a probable loss of a note receivable. Special items in the prior year consisted of a $2.0 million charge related to the early termination of operating leases on certain helicopters configured for air medical services and $0.2 million of management fees charged prior to the Spin-off from SEACOR Holdings Inc.
"Era achieved record financial results in fiscal year 2014 as revenues and Adjusted EBITDA excluding gains on asset sales increased by 11% and 10%, respectively, over the prior fiscal year," said Chris Bradshaw, Chief Executive Officer of Era Group. "However, fourth quarter results were weaker than the normal seasonal pattern primarily due to lower utilization of helicopters in our oil and gas line of service, as anticipated in our third quarter earnings announcement."
"In response to the significant decline in oil prices, oil and gas companies have announced substantial reductions in their spending plans for 2015, and many of them are seeking cost reductions from their service providers. The strength of our business model and balance sheet put us in a good position to weather market downturns of this nature. We are focused on maximizing the utilization of our helicopter fleet through new contract awards and fleet management initiatives."
"We also remain focused on realizing operational efficiencies in our business. We announced a management realignment and reduction in force during the fourth quarter which streamlined our organization and significantly reduced our personnel expenses. In addition, we plan to extract efficiencies from other areas of our cost structure during 2015."
Fourth Quarter Results
Operating revenues were $1.3 million lower in the current quarter primarily due to the conclusion of contracts subsequent to the prior year quarter in our international oil and gas and air medical service lines. These decreases were partially offset by increased revenues from search and rescue activities due to higher rates and increased dry-leasing revenues due to improved cash collections from a customer in India and the related change to accrual basis accounting for recognizing revenue from that customer.
Operating expenses were $0.6 million higher in the current quarter primarily due to increased repairs and maintenance expense related to increased flight hours for our EC225 heavy helicopters.
Administrative and general expenses were $0.9 million lower in the current quarter primarily due to the recovery of a previously reserved account receivable from a customer in bankruptcy.
Depreciation expense was $0.7 million higher in the current quarter primarily due to depreciation on new helicopters placed into service.
Interest expense was $0.8 million lower in the current quarter primarily due to increased capitalized interest related to deposits on helicopter orders and a base expansion project.
Derivative gains of $0.8 million in the current quarter were primarily due to a reduction in the amount of unsettled forward currency contracts.
Foreign currency losses of $1.9 million in the current quarter were primarily due to the strengthening of the U.S. dollar resulting in losses on the translation of euro-denominated cash balances and realized losses on forward currency contracts.
Income tax expense was $2.9 million lower in the current quarter primarily due to lower pre-tax income and adjustments related to the state apportionment rates.
Equity earnings were $0.4 million in the current quarter compared to losses of $0.9 million in the prior year quarter. The increase in earnings was due to higher income from our Dart Holding Company Ltd. joint venture.
Sequential Quarter Results
Net income for the current quarter was $1.1 million lower than in the third quarter of 2014. EBITDA was $3.8 million lower in the current quarter compared to the preceding quarter. EBITDA adjusted to exclude gains on asset dispositions and special items was $18.6 million in the current quarter compared to $24.8 million in the preceding quarter. Special items in the third quarter consisted of $2.5 million in severance-related expenses for the Company's former Chief Executive Officer.
Operating revenues in the current quarter were $15.8 million lower compared to the preceding quarter primarily due to lower utilization of helicopters in our oil and gas line of service and the end of seasonal activities in Alaska. Operating expenses were $8.5 million lower primarily due to reduced repairs and maintenance and fuel expenses resulting from decreased activity and lower fuel prices, as well as reduced personnel expenses resulting from the reduction in headcount during the fourth quarter. Administrative and general expenses were $3.3 million lower due to the absence of severance-related expenses for the former CEO noted above and the recovery of a previously reserved account receivable from a customer in bankruptcy.
Full Year Results
Operating revenues were $32.3 million higher in the current year primarily due to our EC225 heavy helicopters operating for the full year in 2014 compared to a partial year in 2013 and an increase in charter activity at higher rates for our medium helicopters operating in the U.S. Gulf of Mexico. These increases were partially offset by lower revenues from oil and gas activities in Alaska primarily due to a smaller fleet count and reduced utilization.
Operating expenses were $17.8 million higher in the current year primarily due to increased repairs and maintenance and fuel expenses related to the resumption of our EC225 helicopter operations, increased personnel expenses related to pay scale and benefit adjustments and increased rebillable expenses, freight expenses and parts cost of sales. These increases were partially offset by decreases in leased-in equipment expenses due to a one-time charge in the prior year related to operating leases on certain helicopters configured for air medical services and reduced insurance and loss reserves due to changes in insured helicopter values.
Administrative and general expenses were $5.1 million higher in the current year primarily due to severance-related expenses resulting from changes in senior management positions and annual salary adjustments and stock compensation grants.
During the current year, the Company sold or otherwise disposed of helicopters and other equipment for proceeds of $7.1 million, resulting in gains of $6.1 million, compared to proceeds from helicopter and equipment sales of $65.2 million and gains of $18.3 million in the prior year.
Interest expense was $3.3 million lower in the current year primarily due to increased capitalized interest related to deposits on helicopter orders and a base expansion project.
Note receivable impairments were $2.5 million in the current year related to a probable loss of a note receivable.
Foreign currency losses of $2.4 million in the current year were primarily due to the strengthening of the U.S. dollar resulting in losses on the translation of euro-denominated cash balances and realized losses on forward currency contracts.
Income tax expense was $3.4 million lower in the current year due to lower pre-tax income and a lower effective tax rate.
Equity earnings were $1.8 million higher in the current year primarily due to a gain recognized on the sale of our 51% interest in our Lake Palma S.L. joint venture.
Fleet Update
During the current quarter, the Company's capital expenditures were $42.8 million, which consisted primarily of deposits on future helicopter deliveries and a base expansion project. The Company made a $22.7 million progress payment on a S92 heavy helicopter during the fourth quarter of 2014 and accelerated the delivery date to August 2015. The Company records helicopter acquisitions in property and equipment and places helicopters in service once all completion work has been finalized and the helicopters are ready for use.
The current excess capacity of our medium helicopters is higher than in recent periods. Excess helicopters include our helicopters other than those under customer contracts, undergoing maintenance or dedicated for charter activity. A decline in the near-term utilization of our medium helicopters may adversely impact our near-term financial results. We have recently been awarded a number of new contracts in the U.S. Gulf of Mexico and Brazil. Some of those contracts have already begun, but most of them are not scheduled to begin until the second half of 2015 or early 2016. In addition, we may sell certain helicopters on an opportunistic basis consistent with our stated strategy.
Capital Commitments
The Company's unfunded capital commitments as of December 31, 2014 consisted primarily of orders for helicopters and totaled $232.3 million, of which $114.9 million is payable during 2015 with the balance payable through 2017. The Company also had $1.9 million of deposits paid on options not yet exercised. The Company may terminate $131.3 million of its total commitments (inclusive of deposits paid on options not yet exercised) without further liability other than liquidated damages of $8.7 million in the aggregate.
Included in these capital commitments are agreements to purchase ten AW189 heavy helicopters, four S92 heavy helicopters and five AW169 light twin helicopters. The AW189 helicopters are scheduled to be delivered in 2015 through 2017. The S92 helicopters are scheduled to be delivered in 2015 through 2016. Delivery dates for the AW169 helicopters have yet to be determined. In addition, the Company had outstanding options to purchase up to an additional ten AW189 helicopters, five S92 helicopters and one AW139 medium helicopter. If these options are exercised, the helicopters would be scheduled for delivery in 2015 through 2018.
Liquidity
As of December 31, 2014, the Company had $40.9 million in cash balances and remaining availability under its senior secured revolving credit facility of $214.3 million.
Conference Call
Management will conduct a conference call starting at 10:00 a.m. ET (9:00 a.m. CT) on Wednesday, March 11, 2015 to review the results for the fourth quarter ended December 31, 2014. The conference call can be accessed as follows:
All callers will need to reference the access code 85831106
Within the U.S.: Operator Assisted Toll-Free Dial-In Number: (866) 607-0535
Outside the U.S.: Operator Assisted International Dial-In Number: (832) 445-1827
Replay
A telephone replay will be available through March 25, 2015 and may be accessed by calling (855) 859-2056 for domestic callers or (404) 537-3406 for international callers. An audio replay will also be available on the Company's website at www.eragroupinc.com shortly after the call and will be accessible for approximately 90 days.
About Era Group
Era Group is one of the largest helicopter operators in the world and the longest serving helicopter transport operator in the U.S. In addition to servicing its U.S. customers, Era Group also provides helicopters and related services to customers and third-party helicopter operators in other countries, including Brazil, India, Norway, Spain, and the United Kingdom. Era Group's helicopters are primarily used to transport personnel to, from and between offshore installations, drilling rigs and platforms.
Forward-Looking Statements Disclosure
Certain statements discussed in this release as well as in other reports, materials and oral statements that the Company releases from time to time to the public include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements concerning management's expectations, strategic objectives, business prospects, anticipated performance and financial condition and other similar matters involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of results to differ materially from any future results, performance or achievements discussed or implied by such forward-looking statements. Such risks, uncertainties and other important factors include, among others, the Company's dependence on, and the cyclical nature of, offshore oil and gas exploration, development and production activity; fluctuations in worldwide prices of and demand for oil and natural gas; the Company's reliance on a small number of customers and reduction of the Company's customer base resulting from consolidation; inherent risks in operating helicopters; the failure to maintain an acceptable safety record; the ability to successfully expand into other geographic and helicopter service markets; the impact of increased United States ("U.S.") and foreign government regulation and legislation, including potential government implemented moratoriums on drilling activities; the requirement to engage in competitive processes or expend significant resources with no guaranty of recoupment; the grounding of all or a portion of our fleet for extended periods of time or indefinitely; reduction or cancellation of services for government agencies; reliance on a small number of helicopter manufacturers and suppliers; political instability, governmental action, war, acts of terrorism and changes in the economic condition in any foreign country where the Company does business, which may result in expropriation, nationalization, confiscation or deprivation of our assets or result in claims of a force majeure situation; declines in the global economy and financial markets; foreign currency exposure and exchange controls; credit risk exposure; the ongoing need to replace aging helicopters; the Company's reliance on the secondary used helicopter market to dispose of older helicopters; the Company's reliance on information technology; allocation of risk between the Company and its customers; liability, legal fees and costs in connection with providing emergency response services; risks associated with the Company's debt structure; operational and financial difficulties of the Company's joint ventures and partners; conflict with the other owners of the Company's non-wholly owned subsidiaries and other equity investees; adverse results of legal proceedings; adverse weather conditions and seasonality; adequacy of insurance coverage; the attraction and retention of qualified personnel; restrictions on the amount of foreign ownership of the Company's common stock; the effect of the Spin-off, and; and various other matters and factors, many of which are beyond the Company's control. In addition, these statements constitute Era Group's cautionary statements under the Private Securities Litigation Reform Act of 1995. It is not possible to predict or identify all such factors. Consequently, the foregoing should not be considered a complete discussion of all potential risks or uncertainties. The words "estimate," "project," "intend," "believe," "plan" and similar expressions are intended to identify forward-looking statements. Forward-looking statements speak only as of the date of the document in which they are made. Era Group disclaims any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in Era Group's expectations or any change in events, conditions or circumstances on which the forward-looking statement is based. The forward-looking statements in this release should be evaluated together with the many uncertainties that affect the Company's businesses, particularly those mentioned under "Risk Factors" in Era Group's Annual Report on Form 10-K for the year ended December 31, 2014, in Era Group's subsequent Quarterly Reports on Form 10-Q and in Era Group's current reporting on Form 8-K (if any), which are incorporated by reference.
For additional information concerning Era Group, contact Benjamin Slusarchuk at (281) 606-4782 or visit EraGroup's website at www.eragroupinc.com.
ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
Three Months Ended Year Ended
December 31, December 31,
------------------------ ------------------------
2014 2013 2014 2013
----------- ----------- ----------- -----------
(unaudited)
Operating revenues $ 74,689 $ 75,998 $ 331,222 $ 298,959
----------- ----------- ----------- -----------
Costs and expenses:
Operating 45,772 45,213 204,373 186,612
Administrative and
general 9,647 10,562 43,987 38,924
Depreciation 11,854 11,129 46,312 45,561
----------- ----------- ----------- -----------
Total costs and
expenses 67,273 66,904 294,672 271,097
----------- ----------- ----------- -----------
Gains on asset
dispositions, net 29 464 6,101 18,301
----------- ----------- ----------- -----------
Operating income 7,445 9,558 42,651 46,163
----------- ----------- ----------- -----------
Other income (expense):
Interest income 122 139 540 591
Interest expense (3,556) (4,311) (14,778) (18,050)
SEACOR management fees -- -- -- (168)
Derivative gains
(losses), net 800 (26) (944) (104)
Note receivable
impairment -- -- (2,457) --
Foreign currency gains
(losses), net (1,856) 233 (2,377) 698
Other, net (14) -- (4) 19
----------- ----------- ----------- -----------
Total other income
(expense) (4,504) (3,965) (20,020) (17,014)
----------- ----------- ----------- -----------
Income before income tax
expense and equity
earnings (losses) 2,941 5,593 22,631 29,149
Income tax expense 155 3,036 8,285 11,727
----------- ----------- ----------- -----------
Income before equity
earnings (losses) 2,786 2,557 14,346 17,422
Equity earnings (losses),
net of tax 354 (880) 2,675 882
----------- ----------- ----------- -----------
Net income 3,140 1,677 17,021 18,304
Net loss attributable to
non-controlling interest
in subsidiary 45 75 96 401
----------- ----------- ----------- -----------
Net income attributable
to Era Group Inc. 3,185 1,752 17,117 18,705
Accretion of redemption
value on Series A
preferred stock -- -- -- 721
----------- ----------- ----------- -----------
Net income attributable
to common shares $ 3,185 $ 1,752 $ 17,117 $ 17,984
=========== =========== =========== ===========
Basic earnings per common
share $ 0.16 $ 0.09 $ 0.84 $ 0.88
Diluted earnings per
common share $ 0.16 $ 0.09 $ 0.84 $ 0.88
Weighted average common
shares outstanding,
basic 20,173,583 19,924,708 20,073,378 20,299,854
Weighted average common
shares outstanding,
diluted 20,232,025 19,991,868 20,139,581 20,344,782
EBITDA $ 18,583 $ 20,014 $ 85,856 $ 93,051
Adjusted EBITDA $ 18,583 $ 20,014 $ 90,775 $ 95,264
Adjusted EBITDA excluding
Gains $ 18,554 $ 19,550 $ 84,674 $ 76,963
ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share amounts)
Three Months Ended
-----------------------------------------------------------
Dec 31, Sep 30, Jun 30, Mar 31, Dec 31,
2014 2014 2014 2014 2013
----------- ----------- ----------- ----------- -----------
Operating
revenues $ 74,689 $ 90,510 $ 86,580 $ 79,443 $ 75,998
----------- ----------- ----------- ----------- -----------
Costs and
expenses:
Operating 45,772 54,282 54,679 49,640 45,213
Administrative
and
general 9,647 12,941 10,065 11,334 10,562
Depreciation 11,854 11,746 11,425 11,287 11,129
----------- ----------- ----------- ----------- -----------
Total costs
and
expenses 67,273 78,969 76,169 72,261 66,904
----------- ----------- ----------- ----------- -----------
Gains on asset
dispositions,
net 29 42 3,139 2,891 464
----------- ----------- ----------- ----------- -----------
Operating
income 7,445 11,583 13,550 10,073 9,558
----------- ----------- ----------- ----------- -----------
Other income
(expense):
Interest
income 122 130 143 145 139
Interest
expense (3,556) (3,629) (3,840) (3,753) (4,311)
SEACOR
management
fees -- -- -- -- --
Derivative
gains
(losses),
net 800 (1,703) (11) (30) (26)
Note
receivable
impairment -- -- (2,457) -- --
Foreign
currency
gains
(losses),
net (1,856) (485) 21 (57) 233
Other, net (14) (3) 13 -- --
----------- ----------- ----------- ----------- -----------
Total other
income
(expense) (4,504) (5,690) (6,131) (3,695) (3,965)
----------- ----------- ----------- ----------- -----------
Income before
income tax
expense and
equity
earnings
(losses) 2,941 5,893 7,419 6,378 5,593
Income tax
expense 155 2,868 2,759 2,503 3,036
----------- ----------- ----------- ----------- -----------
Income before
equity
earnings
(losses) 2,786 3,025 4,660 3,875 2,557
Equity earnings
(losses), net
of tax 354 1,286 536 499 (880)
----------- ----------- ----------- ----------- -----------
Net income 3,140 4,311 5,196 4,374 1,677
Net loss
attributable
to non-
controlling
interest in
subsidiary 45 (45) 25 71 75
----------- ----------- ----------- ----------- -----------
Net income
attributable
to Era Group
Inc. $ 3,185 $ 4,266 $ 5,221 $ 4,445 $ 1,752
=========== =========== =========== =========== ===========
Basic earnings
per common
share $ 0.16 $ 0.21 $ 0.26 $ 0.22 $ 0.09
Diluted
earnings per
common share $ 0.16 $ 0.21 $ 0.26 $ 0.22 $ 0.09
Weighted
average common
shares
outstanding,
basic 20,173,583 20,098,239 20,066,060 19,952,930 19,924,708
Weighted
average common
shares
outstanding,
diluted 20,232,025 20,163,990 20,134,474 20,025,135 19,991,868
EBITDA $ 18,583 $ 22,424 $ 23,077 $ 21,772 $ 20,014
Adjusted EBITDA $ 18,583 $ 24,886 $ 25,534 $ 21,772 $ 20,014
Adjusted EBITDA
excluding
Gains $ 18,554 $ 24,844 $ 22,395 $ 18,881 $ 19,550
ERA GROUP INC.
OPERATING REVENUES BY LINE OF SERVICE
(unaudited, in thousands)
Three Months Ended
------------------------------------------------
Dec 31, Sep 30, Jun 30, Mar 31, Dec 31,
2014 2014 2014 2014 2013
-------- -------- -------- -------- --------
Oil and gas:(1)
U.S. Gulf of Mexico $ 45,837 $ 52,870 $ 51,715 $ 49,141 $ 45,435
Alaska 6,496 7,984 9,305 6,197 6,885
International 183 1,514 173 1,245 1,228
-------- -------- -------- -------- --------
Total oil and gas 52,516 62,368 61,193 56,583 53,548
Dry-leasing 11,911 12,392 11,466 10,876 11,566
Search and rescue 5,650 5,666 5,095 6,152 5,417
Air medical services 2,301 2,569 3,137 3,091 3,135
Flightseeing -- 4,043 2,946 -- --
Fixed Base Operations 2,403 3,562 2,858 2,842 2,434
Eliminations (92) (90) (115) (101) (102)
-------- -------- -------- -------- --------
$ 74,689 $ 90,510 $ 86,580 $ 79,443 $ 75,998
======== ======== ======== ======== ========
FLIGHT HOURS BY LINE OF SERVICE(2)
(unaudited)
Three Months Ended
-------------------------------------------------
Dec 31, Sep 30, Jun 30, Mar 31, Dec 31,
2014 2014 2014 2014 2013
--------- --------- --------- --------- ---------
Oil and gas:(1)
U.S. Gulf of Mexico 8,514 10,594 11,065 9,447 10,304
Alaska 560 939 1,122 682 895
International -- -- -- 57 62
--------- --------- --------- --------- ---------
Total oil and gas 9,074 11,533 12,187 10,186 11,261
Search and rescue 355 348 258 382 305
Air medical services 831 1,239 1,100 951 1,059
Flightseeing -- 1,505 1,080 -- --
--------- --------- --------- --------- ---------
10,260 14,625 14,625 11,519 12,625
========= ========= ========= ========= =========
(1) Primarily oil and gas services, but also includes revenues from
activities such as firefighting and utility support.
(2) Does not include hours flown by helicopters in our dry-leasing line of
service.
ERA GROUP INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
Dec 31, Sep 30, Jun 30, Mar 31, Dec 31,
2014 2014 2014 2014 2013
---------- ----------- ----------- ----------- ----------
ASSETS (unaudited) (unaudited) (unaudited)
Current assets:
Cash and cash
equivalents $ 40,867 $ 40,357 $ 14,940 $ 22,290 $ 31,335
Receivables:
Trade, net of
allowance for
doubtful
accounts 33,390 48,307 52,582 47,780 38,137
Other 2,062 1,679 2,078 4,824 4,374
Inventories, net 26,869 27,039 26,863 26,780 26,853
Prepaid expenses
and other 2,661 1,712 2,991 3,292 2,167
Deferred income
taxes 1,996 2,065 1,991 2,138 2,347
Escrow deposits -- -- -- 3,048 --
---------- ----------- ----------- ----------- ----------
Total current
assets 107,845 121,159 101,445 110,152 105,213
---------- ----------- ----------- ----------- ----------
Property and
equipment 1,171,267 1,128,510 1,116,678 1,084,199 1,066,958
Accumulated
depreciation (308,141) (296,294) (284,547) (273,754) (263,306)
---------- ----------- ----------- ----------- ----------
Net property
and equipment 863,126 832,216 832,131 810,445 803,652
---------- ----------- ----------- ----------- ----------
Equity investments
and advances 31,753 31,641 36,053 35,433 34,986
Goodwill 352 352 352 352 352
Other assets 14,098 14,794 15,868 16,074 14,380
---------- ----------- ----------- ----------- ----------
Total assets $1,017,174 $ 1,000,162 $ 985,849 $ 972,456 $ 958,583
========== =========== =========== =========== ==========
LIABILITIES AND
STOCKHOLDERS'
EQUITY
Current
liabilities:
Accounts payable
and accrued
expenses $ 15,120 $ 21,819 $ 23,129 $ 13,639 $ 13,293
Accrued wages
and benefits 7,521 9,651 9,791 9,583 8,792
Accrued interest 949 4,805 950 4,624 772
Accrued income
taxes 267 1,029 236 781 613
Derivative
instruments 1,109 1,991 569 529 621
Current portion
of long-term
debt 27,426 2,787 2,787 2,787 2,787
Other current
liabilities 3,162 4,154 4,258 4,171 3,267
---------- ----------- ----------- ----------- ----------
Total current
liabilities 55,554 46,236 41,720 36,114 30,145
---------- ----------- ----------- ----------- ----------
Long-term debt 282,118 277,390 278,023 278,755 279,391
Deferred income
taxes 217,027 216,985 214,117 211,479 209,574
Deferred gains and
other liabilities 2,111 2,898 3,120 3,476 3,412
---------- ----------- ----------- ----------- ----------
Total
liabilities 556,810 543,509 536,980 529,824 522,522
---------- ----------- ----------- ----------- ----------
Equity:
Era Group Inc.
stockholders'
equity:
Common stock 204 204 204 203 202
Additional
paid-in
capital 429,109 428,530 425,010 423,728 421,310
Retained
earnings 31,797 28,612 24,346 19,125 14,680
Treasury
shares, at
cost (551) (547) (547) (334) (113)
Accumulated
other
comprehensive
income
(loss), net
of tax 95 99 146 175 176
---------- ----------- ----------- ----------- ----------
Total Era
Group Inc.
stockholders'
equity 460,654 456,898 449,159 442,897 436,255
Non-controlling
interest in
subsidiary (290) (245) (290) (265) (194)
---------- ----------- ----------- ----------- ----------
Total equity 460,364 456,653 448,869 442,632 436,061
---------- ----------- ----------- ----------- ----------
Total liabilities
and stockholders'
equity $1,017,174 $ 1,000,162 $ 985,849 $ 972,456 $ 958,583
========== =========== =========== =========== ==========
The Company's management uses EBITDA and Adjusted EBITDA to assess the performance and operating results of our business. EBITDA is defined as Earnings before Interest (includes interest income and interest expense), Taxes, Depreciation and Amortization. Adjusted EBITDA is defined as EBITDA further adjusted for certain non-recurring items that occur during the reported period, as noted below. We include EBITDA and Adjusted EBITDA to provide investors with a supplemental measure of our operating performance. Neither EBITDA nor Adjusted EBITDA is a recognized term under generally accepted accounting principles in the U.S. ("GAAP"). Accordingly, they should not be used as an indicator of, or an alternative to, net income as a measure of operating performance. In addition, EBITDA and Adjusted EBITDA are not intended to be measures of free cash flow available for management's discretionary use, as they do not consider certain cash requirements, such as debt service requirements. Because the definitions of EBITDA and Adjusted EBITDA (or similar measures) may vary among companies and industries, they may not be comparable to other similarly titled measures used by other companies.
The following table provides a reconciliation of Net Income, the most directly comparable GAAP measure, to EBITDA, Adjusted EBITDA and Adjusted EBITDA further adjusted to exclude gains on dispositions (in thousands).
Three Months Ended Year Ended
--------------------------------------- ----------------
Dec 31, Sep 30, Jun 30, Mar 31, Dec 31, Dec 31, Dec 31,
2014 2014 2014 2014 2013 2014 2013
------- ------- ------- ------- ------- ------- --------
Net Income $ 3,140 $ 4,311 $ 5,196 $ 4,374 $ 1,677 $17,021 $ 18,304
Depreciation 11,854 11,746 11,425 11,287 11,129 46,312 45,561
Interest income (122) (130) (143) (145) (139) (540) (591)
Interest expense 3,556 3,629 3,840 3,753 4,311 14,778 18,050
Income tax
expense 155 2,868 2,759 2,503 3,036 8,285 11,727
------- ------- ------- ------- ------- ------- --------
EBITDA $18,583 $22,424 $23,077 $21,772 $20,014 $85,856 $ 93,051
Special items
(1) -- 2,462 2,457 -- -- 4,919 2,213
------- ------- ------- ------- ------- ------- --------
Adjusted EBITDA $18,583 $24,886 $25,534 $21,772 $20,014 $90,775 $ 95,264
Gains on asset
dispositions,
net ("Gains") (29) (42) (3,139) (2,891) (464) (6,101) (18,301)
------- ------- ------- ------- ------- ------- --------
Adjusted EBITDA
excluding Gains $18,554 $24,844 $22,395 $18,881 $19,550 $84,674 $ 76,963
======= ======= ======= ======= ======= ======= ========
(1) Special items include the following:
- In the three months ended September 30, 2014, a pre-tax charge of $2.5 million related to the accelerated recognition of previously awarded but deferred compensation awards following the resignation of our former CEO;
- In the three months ended June 30, 2014, a pre-tax impairment charge of $2.5 million on a note receivable from a foreign company with whom we participated in bids for contracts; and
- In the year ended December 31, 2013, a one-time charge of $2.0 million related to the early termination of operating leases on certain helicopters configured for air medical services and SEACOR management fees of $0.2 million incurred prior to the Spin-off on January 31, 2013.
ERA GROUP INC.
FLEET COUNTS(1)
(unaudited)
Dec 31, Sep 30, Jun 30, Mar 31, Dec 31,
2014 2014 2014 2014 2013
-------- -------- -------- -------- --------
Heavy:
EC225 9 9 9 9 9
======== ======== ======== ======== ========
Medium:
AW139 39 39 38 37 35
B212 9 9 9 10 11
B412 6 6 6 6 6
S76 A/A++ 2 2 2 2 3
S76 C+/C++ 6 6 6 6 6
-------- -------- -------- -------- --------
62 62 61 61 61
======== ======== ======== ======== ========
Light--twin engine:
A109 9 9 9 9 9
BK-117 3 3 3 3 3
EC135 20 20 20 20 20
EC145 5 5 5 4 4
-------- -------- -------- -------- --------
37 37 37 36 36
======== ======== ======== ======== ========
Light--single engine:
A119 17 17 24 24 24
AS350 35 35 35 35 35
-------- -------- -------- -------- --------
52 52 59 59 59
======== ======== ======== ======== ========
Total Helicopters 160 160 166 165 165
======== ======== ======== ======== ========
(1) Includes all owned, joint ventured, leased-in and managed helicopters
and excludes helicopters fully paid for and delivered but not yet placed
in service as of the applicable dates.
Contact Benjamin Slusarchuk (281) 606-4782 www.eragroupinc.com
Source: Era Group Inc.
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