Bristow Group Inc. (NYSE: VTOL) (“Bristow” or the “Company”)  today reported net income attributable to the Company of $6.6 million, or $0.23 per diluted share, for its quarter ended March 31, 2024 (the “Current Quarter”) on operating revenues of $329.4 million compared to net loss attributable to the Company of $7.9 million, or $0.28 per diluted share, for the quarter ended December 31, 2023 (the “Preceding Quarter”) on operating revenues of $329.6 million.

Earnings before interest, taxes, depreciation and amortization (“EBITDA”) was $35.8 million in the Current Quarter compared to $41.8 million in the Preceding Quarter. EBITDA adjusted to exclude special items, gains or losses on asset dispositions and foreign exchange gains (losses) was $47.5 million in the Current Quarter compared to $46.0 million in the Preceding Quarter. The following table provides a reconciliation of net income (loss) to EBITDA, Adjusted EBITDA and Adjusted EBITDA excluding gains or losses on asset dispositions and foreign exchange gains (losses) (in thousands, unaudited). See “Non-GAAP Financial Measures” for further information on the use of non-GAAP financial measures used herein.

	Three Months Ended,
	March 31, 2024		December 31, 2023
Net income (loss)	$               6,632		$              (8,103)
Depreciation and amortization expense	17,169		17,007
Interest expense, net	9,472		11,274
Income tax expense	2,508		21,598
EBITDA(1)	$             35,781		$              41,776
Special items:
PBH amortization	3,726		3,729
Merger and integration costs	—		347
Other special items(2)	1,346		1,873
	$               5,072		$                5,949
Adjusted EBITDA(1)	$             40,853		$              47,725
Losses on disposal of assets	113		159
Foreign exchange (gains) losses	6,499		(1,882)
Adjusted EBITDA excluding asset dispositions and foreign exchange	$             47,465		$              46,002

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“In addition to reporting strong first quarter results and affirming full-year 2024 financial guidance, we are pleased to issue Bristow’s financial outlook for 2025 and set financial targets for 2026,” said Chris Bradshaw, President and CEO of Bristow Group. “The mid-point of our 2026 Adjusted EBITDA target represents a three-year compound annual growth rate of 21% relative to the Company’s 2023 Adjusted EBITDA. This outlook is consistent with our view that we are in the early stages of a multi-year growth cycle. The investments that we are making to grow and diversify our leading government services business, combined with an accelerating offshore energy upcycle and a tight supply of offshore-configured helicopters, are increasing the Company’s visibility for significant growth in revenues, Adjusted EBITDA and free cash flow. The improvements in margins, capital returns and free cash flow present multiple opportunities to create value for Bristow’s shareholders.”

Sequential Quarter Results

Operating revenues in the Current Quarter were $0.2 million lower compared to the Preceding Quarter. Operating revenues from offshore energy services were $0.7 million higher primarily due to increased activity and higher rates in Africa and Norway. Operating revenues from government services were $0.4 million higher in the Current Quarter primarily due to the strengthening of the British Pound Sterling (“GBP”) relative to the U.S. dollar. Operating revenues from fixed wing services were $2.0 million lower in the Current Quarter primarily due to lower seasonal utilization in Australia and the weakening of the Nigerian Naira (“NGN”) relative to the U.S. dollar. Operating revenues from other services were $0.6 million higher primarily due to higher dry-lease revenues.

Operating expenses were $2.2 million lower than the Preceding Quarter primarily due to lower fuel costs and repairs and maintenance costs, partially offset by higher insurance and other operating costs.

General and administrative expenses were $0.8 million lower than the Preceding Quarter primarily due to lower professional services fees and lower insurance costs, partially offset by higher personnel costs.

Interest income was $1.5 million lower primarily due to lower investment balances.

Interest expense, net was $1.8 million lower in the Current Quarter primarily due to higher capitalized interest on aircraft purchases.

Other expense, net of $6.2 million in the Current Quarter primarily resulted from foreign exchange losses of $6.5 million due to the significant devaluation of the NGN. Other income, net of $1.7 million in the Preceding Quarter resulted from foreign exchange gains of $1.9 million, partially offset by an unfavorable interest adjustment to the Company’s pension liability of $0.3 million.

Income tax expense was $2.5 million in the Current Quarter compared to $21.6 million in the Preceding Quarter primarily due to the earnings mix of the Company’s global operations and changes to deferred tax valuation allowances and assets.

Liquidity and Capital Allocation

As of March 31, 2024, the Company had $140.6 million of unrestricted cash and $81.9 million of remaining availability under its amended asset-based revolving credit facility (the “ABL Facility”) for total liquidity of $222.5 million. Borrowings under the ABL Facility are subject to certain conditions and requirements.

In the Current Quarter, purchases of property and equipment were $64.6 million, of which $4.9 million were maintenance capital expenditures. In the Preceding Quarter, purchases of property and equipment were $19.4 million, of which $4.3 million were maintenance capital expenditures.

In January 2024, the Company entered into a long-term equipment financing to upsize its £145 million secured equipment financings with National Westminster Bank Plc (the “NatWest Debt”) by an aggregate amount of up to £55 million. The upsizing will be used to support the Company’s capital commitments related to the Second-Generation UK Search and Rescue contract. In April 2024, the first utilization date occurred under the upsized NatWest Debt, and the Company borrowed approximately £26 million at that time.

Affirmed 2024 Outlook, Issued 2025 Outlook and 2026 Targets

Please refer to the paragraph entitled “Forward Looking Statements Disclosure” below for further discussion regarding the risks and uncertainties as well as other important information regarding Bristow’s guidance. The following guidance also contains the non-GAAP financial measure of Adjusted EBITDA. Please read the section entitled “Non-GAAP Financial Measures” for further information.

Select financial outlook for 2024 and 2025 as well as 2026 targets are as follows (in USD, millions):

There are two main ways in which foreign currency fluctuations impact Bristow’s reported financials. The first is primarily non-cash foreign exchange gains (losses) that are reported in the Other Income line on the Income Statement. These are related to the revaluation of balance sheet items, typically do not impact cash flows, and thus are excluded in the Adjusted EBITDA presentation. The second is through impacts to certain revenue and expense items, which impact the Company’s cash flows; these impacts are not excluded in the Adjusted EBITDA presentation. The primary exposure is the GBP/USD exchange rate.

Each £0.01 movement in the GBP/USD exchange rate would impact Adjusted EBITDA by +/- ~$1.5 million.