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- Revenues for the quarter ended Oct. 31, 2013 (“Current Quarter”) were consistent with the comparative period at $65.0 million. Despite ongoing challenges in the mining sector in northern Canada and lower forest fire activity, the Aviation segment recorded higher revenue due to solid performance from Great Slave Helicopters Ltd. (“GSH”), which reported its strongest third quarter in its history. Revenues for the nine month period ended Oct. 31, 2013 (“Year-to-date”) were $180.9 million decreasing by 6 per cent from the comparative period on lower resource and forest fire management activity.
- Current Quarter EBITDA was $15.4 million compared to EBITDA of $16.0 million reported in the comparative period, with the decrease due primarily to increased business development and acquisition related costs associated with projects at Discovery Air Defence Services Inc. (“Defence Services”) (see “Recent Developments” below). Excluding these costs, EBITDA was $16.9 million in the Current Quarter. Year-to-date EBITDA was $34.2 million compared to $48.1 million reported in the comparative period due to weaker results in the first half of the year and $3.1 million in additional business development and acquisition costs. Year-to-date capital asset expenditures decreased to $14.4 million compared to $32.2 million in the comparative period thereby offsetting reduced cash inflows from the lower EBITDA.
- The Corporation recorded a quarterly profit of $3.1 million ($0.21 basic earnings per share and $0.19 diluted earnings per share) compared to $1.2 million ($0.08 earnings per share – basic and diluted) in the third quarter of the comparative year. Current Quarter profit included a tax-effected impairment loss of $0.6 million. Excluding all non-cash gains, Adjusted profit was $3.6 million compared to an Adjusted profit of $4.1 million in the comparative quarter.
- Year-to-date profit was $3.5 million ($0.24 earnings per share – basic and diluted) compared to a profit of $11.5 million ($0.79 basic earnings per share and $0.63 diluted earnings per share) in the comparative period. The Corporation’s year-to-date profit includes a tax-effected impairment loss of $0.6 million, a tax-effected gain of $0.4 million from the sale of Hudson Bay Helicopters Ltd., and a non-taxable gain of $1.2 million related to the second quarter revaluation of the second installment of the contingent consideration for the purchase of Helicopters Chile. The comparative year-to-date profit reflects a tax-effected gain of $1.9 million on extinguishment of debt, a $0.2 million non-taxable gain related to a change in the fair value of the Corporation’s embedded derivative that existed up to March 26, 2012, a $0.3 million non-taxable gain on the acquisition of the business of Northern Air Support Ltd., and a tax-effected impairment loss of $2.7 million. Excluding the impact of these transactions, the year-to-date Adjusted profit was $2.4 million ($0.16 earnings per share – basic and diluted) compared to $11.9 million ($0.82 basic earnings per share and $0.64 diluted earnings per share) in the comparative period. Year-to-date Adjusted profit was primarily affected by lower first quarter results.
- The decrease in the Corporation’s trailing twelve month EBITDA (primarily from lower than expected first quarter results) continues to exert pressure on the total debt leverage ratio covenant related to the secured convertible debentures. To avoid any possibility of non-compliance with this covenant, the Corporation requested and received a waiver for the fourth quarter ending Jan. 31, 2014 (please refer to the MD&A for further information).