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Discovery Air Inc. (the Corporation) has announced its financial and operating results for the quarter and year ended January 31, 2015. The audited consolidated financial statements and management discussion and analysis (MD&A) will be available on SEDAR at www.sedar.com and on the Corporation’s website at www.discoveryair.com.
Financial Highlights
- Consolidated revenues for the three months ended Jan. 31, 2015 (Current Quarter) increased 5 per cent, in comparison to the three months ended January 31, 2014. The Aviation segment experienced increased activity (an 8 per cent increase from the comparative period) primarily as a result of forest fire suppression operations in South America.
- Consolidated revenues for the year ended Jan. 31, 2015 (Year-to-date) decreased 11 per cent, in comparison to the year ended Jan. 31, 2014. The decline was largely attributable to decreased flight hours due to cyclical resourced-based activity in our commercial markets.
- EBITDA loss for the Current Quarter decreased 14 per cent in comparison to the same period in the prior year, primarily due to increased flight hours for the quarter. EBITDA for the twelve months ending Jan. 31, 2015 declined by 35 per cent in comparison to the same period in the prior year, primarily stemming from decreased flight hours.
- Loss for the three months ended Jan. 31, 2015 was $15.2 million compared to $21.4 million for the same period in the prior year. The variance was mainly attributable to increased flight hours, and a reduction of $8.1 million in impairment charges. For the year ended Jan. 31, 2015, loss was $18.9 million compared to a loss of $18.0 million in the comparative period with the increase primarily resulting from an $8.7 million decline in EBITDA offset by reduced impairment charges of $9.1 million.
“The fourth quarter ended a challenging year with a better note,” reported Jacob (Koby) Shavit, the Corporation’s president and chief executive officer. “Discovery Air generated improved financial results for our fourth quarter which is traditionally our slowest period in the fiscal year, and made significant inroads with long-term strategic initiatives. With a moderate increase in revenues, coupled with cost efficiency measures implemented as we adapted to existing market conditions, Discovery Air has positioned itself to capitalize on opportunities when market conditions improve.”
“The Company’s vision remains very focused as we target long-term achievements in the Oil & Gas and Mining sectors while pursuing robust international growth opportunities with Contracted Airborne Training Services. The current quarter realized a significant achievement for the Corporation with the commencement of these services in Europe/Germany.”
Recent Developments
- In January 2015, Air Tindi Ltd., a subsidiary of the Corporation, renewed a contract with the Stanton Health Authority in the Northwest Territories, to provide medevac equipped aircraft services for a period of eight years plus two option years. In April 2015, the Corporation purchased three King Air 250s for USD $13.3 million (approximately CAD $16.7 million) to support this contract. The purchase was primarily financed with a $15.0 million loan from the aircraft vendor with a term of eight years.
- In April 2015, the Corporation renewed its fire services contract with the Ontario Ministry of Natural Resources and Forestry for a period of seven years.
- On Jan. 19, 2015, the Corporation announced its intent to complete a second rights offering (Recent Offering) in order to raise up to $11.0 million of equity capital through the sale of Class A common voting shares and/or Class B common variable voting shares (collectively referred to as the Shares). Under the Recent Offering the Corporation distributed a total of 31,997,475 rights to its shareholders of record on February 10, 2015 entitling them to subscribe for up to an aggregate of 50.0 million shares at a price of $0.22 per Share.
- The Recent Offering was completed on March 13, 2015. The Corporation raised $11.0 million in gross proceeds for the issuance of 50.0 million Shares. As a result of the Recent Offering the Unsecured Debentures conversion price changed to $5.07 per Share (formerly $6.53 per Share).
During January 2015 the Corporation commenced operations in Germany, providing the German Armed Forces airborne training services under a five year term contract awarded on Jan. 30, 2014.
