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CHC’s revenue for the three months ending July 31 was $415 million, down $1 million from last year.
The company reported a net loss of $36 million for the quarter, an increase from a net loss of $32 million last year. However, EBITDAR (earnings before interest, taxes, depreciation, amortization and rent, and excluding aircraft leasing costs), CHC’s primary measure of operational performance, was up 10 per cent to $111 million.
While CHC was able to mitigate much of the operational disruption to customers, the unavailability of EC225 aircraft for flying operations in Q1 resulted in lower company revenue. There were related cost tradeoffs in the quarter: normal operating expenses were lower because those aircraft were not flying, but this was offset somewhat by first-quarter spending to prepare the EC225s to resume service in Q2.
“We have been working hard to implement engineering changes to our fleet of EC225s, and it’s great for customers and for our industry that we’re now safely returning those aircraft to full service,” said William Amelio, CHC’s president and chief executive officer.
BUSINESS HIGHLIGHTS
Helicopter Services (flying):
Revenue from CHC’s flying segment was down 1 per cent in Q1, mostly attributable to the EC225 situation. Sales were up in Eastern North Sea, Asia Pacific and Africa‐Euro Asia, driven by new contracts with oil and gas producers.
EBITDAR from Helicopter Services increased 22 per cent, partly because of additional margins from new contracts and lower EC225-related costs.
Business wins in Q1 were broadly distributed around the globe, including in Australia, Brazil, Ireland, Kazakhstan, Malaysia, Norway, Thailand and the United Kingdom.
CHC has been working with customers to stage the return of EC225s to full service and now has two-thirds of the aircraft safely ready to fly. The company expects to have its entire EC225 fleet available during October.
Heli-One (MRO):
First-quarter total revenue from Heli-One, CHC’s helicopter maintenance, repair and overhaul (MRO) segment, rose 4 per cent, hampered by inactivity of CHC’s EC225s. However, sales to third-party customers were up 13 per cent.
Heli-One’s EBITDAR(i) decreased $12 million, mostly because of costs incurred to increase availability of other CHC aircraft while EC225s were on the ground in Q1, and to prepare for the start of their return to service in Q2.
Heli-One is investing in additional marketing and sales capacity to best reach additional MRO opportunities.
