Annual report pursuant to Section 13 and 15(d)

GUARANTORS OF SECURITIES

v3.10.0.1
GUARANTORS OF SECURITIES
12 Months Ended
Dec. 31, 2018
Guarantees [Abstract]  
GUARANTORS OF SECURITIES
Era Group’s payment obligations under the 7.750% Senior Notes are jointly and severally guaranteed by all of its existing 100% owned U.S. subsidiaries that guarantee the Revolving Credit Facility and any future U.S. subsidiaries that guarantee the Revolving Credit Facility or other material indebtedness Era Group may incur in the future (the “Guarantors”). All the Guarantors currently guarantee the Revolving Credit Facility, and the guarantees of the Guarantors are full and unconditional and joint and several.
As a result of the agreement by the Guarantors to guarantee the 7.750% Senior Notes, the Company presents the following condensed consolidating balance sheets and statements of operations, comprehensive income and cash flows for Era Group (“Parent”), the Guarantors and the Company’s other subsidiaries (“Non-guarantors”). These statements should be read in conjunction with the accompanying consolidated financial statements and notes of the Company.
Supplemental Condensed Consolidating Balance Sheet as of December 31, 2018
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands, except share data)
ASSETS
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
48,396

 
$

 
$
2,357

 
$

 
$
50,753

Receivables:
 
 
 
 
 
 
 
 
 
Trade, operating, net of allowance for doubtful accounts of $261

 
27,509

 
5,797

 

 
33,306

Trade, dry leasing

 
3,803

 

 

 
3,803

Tax receivables

 
6

 
3,181

 

 
3,187

Other

 
1,949

 
394

 

 
2,343

Inventories, net

 
20,633

 
40

 

 
20,673

Prepaid expenses
398

 
1,219

 
190

 

 
1,807

Total current assets
48,794

 
55,119

 
11,959

 

 
115,872

Property and equipment

 
900,611

 
16,550

 

 
917,161

Accumulated depreciation

 
(314,567
)
 
(3,400
)
 

 
(317,967
)
Net property and equipment

 
586,044

 
13,150

 

 
599,194

Equity investments and advances

 
27,112

 

 

 
27,112

Investments in consolidated subsidiaries
172,950

 

 

 
(172,950
)
 

Intangible assets

 

 
1,107

 

 
1,107

Deferred income taxes
9,904

 

 

 
(9,904
)
 

Intercompany receivables
366,541

 

 

 
(366,541
)
 

Other assets
1,251

 
20,231

 
96

 

 
21,578

Total assets
$
599,440

 
$
688,506

 
$
26,312

 
$
(549,395
)
 
$
764,863

LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
$
136

 
$
11,357

 
$
1,668

 
$

 
$
13,161

Accrued wages and benefits
43

 
7,743

 
1,481

 

 
9,267

Accrued interest
500

 
69

 

 

 
569

Accrued income taxes
918

 
6

 
49

 

 
973

Current portion of long-term debt

 
1,663

 
395

 

 
2,058

Accrued other taxes

 
768

 
500

 

 
1,268

Accrued contingencies

 

 
630

 

 
630

Other current liabilities
647

 
220

 
11

 

 
878

Total current liabilities
2,244

 
21,826

 
4,734

 

 
28,804

Long-term debt
133,900

 
26,317

 

 

 
160,217

Deferred income taxes

 
117,015

 
1,245

 
(9,903
)
 
108,357

Intercompany payables

 
310,727

 
55,847

 
(366,574
)
 

Other liabilities

 
720

 
27

 

 
747

Total liabilities
136,144

 
476,605

 
61,853

 
(376,477
)
 
298,125

Redeemable noncontrolling interest

 
3

 
3,299

 

 
3,302

Equity:
 
 
 
 
 
 
 
 
 
Era Group Inc. stockholders’ equity:
 
 
 
 
 
 
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 21,765,404 outstanding, exclusive of treasury shares
219

 

 

 

 
219

Additional paid-in capital
447,299

 
100,306

 
4,562

 
(104,869
)
 
447,298

Retained earnings
18,254

 
111,482

 
(43,402
)
 
(68,049
)
 
18,285

Treasury shares, at cost, 156,737 shares
(2,476
)
 

 

 

 
(2,476
)
Accumulated other comprehensive income, net of tax

 
110

 

 

 
110

Total equity
463,296

 
211,898

 
(38,840
)
 
(172,918
)
 
463,436

Total liabilities, redeemable noncontrolling interest and stockholders’ equity
$
599,440

 
$
688,506

 
$
26,312

 
$
(549,395
)
 
$
764,863

Supplemental Condensed Consolidating Balance Sheet as of December 31, 2017
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands, except share data)
ASSETS
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
10,800

 
$

 
$
2,783

 
$

 
$
13,583

Receivables:
 
 
 
 
 
 
 
 
 
Trade, operating, net of allowance for doubtful accounts of $1,196

 
27,968

 
5,872

 
$

 
33,840

Trade, dry leasing

 
5,124

 

 

 
5,124

Tax receivables

 

 
2,829

 

 
2,829

Other

 
1,126

 
497

 

 
1,623

Inventories, net

 
20,746

 
366

 

 
21,112

Prepaid expenses
349

 
721

 
133

 

 
1,203

Escrow deposits

 
3,250

 

 

 
3,250

Total current assets
11,149

 
58,935

 
12,480

 

 
82,564

Property and equipment

 
956,918

 
16,024

 

 
972,942

Accumulated depreciation

 
(296,573
)
 
(2,455
)
 

 
(299,028
)
Net property and equipment

 
660,345

 
13,569

 

 
673,914

Equity investments and advances

 
30,056

 

 

 
30,056

Investments in consolidated subsidiaries
161,350

 

 

 
(161,350
)
 

Intangible assets

 

 
1,122

 

 
1,122

Deferred income taxes
19,600

 

 

 
(19,600
)
 

Intercompany receivables
426,806

 

 

 
(426,806
)
 

Other assets
1,011

 
3,370

 
60

 

 
4,441

Total assets
$
619,916

 
$
752,706

 
$
27,231

 
$
(607,756
)
 
$
792,097

LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
$
638

 
$
13,655

 
$
2,128

 
$

 
$
16,421

Accrued wages and benefits

 
6,804

 
1,460

 

 
8,264

Accrued interest
549

 
57

 

 

 
606

Accrued income taxes

 
24

 
4

 

 
28

Current portion of long-term debt

 
1,663

 
1,073

 

 
2,736

Accrued other taxes
18

 
1,192

 
600

 

 
1,810

Accrued contingencies

 

 
859

 

 
859

Other current liabilities
848

 
835

 
37

 

 
1,720

Total current liabilities
2,053

 
24,230

 
6,161

 

 
32,444

Long-term debt
172,292

 
27,979

 
1,903

 

 
202,174

Deferred income taxes

 
124,948

 
1,250

 
(19,600
)
 
106,598

Intercompany payables

 
381,660

 
45,146

 
(426,806
)
 

Other liabilities

 
1,435

 
(1
)
 

 
1,434

Total liabilities
174,345

 
560,252

 
54,459

 
(446,406
)
 
342,650

Redeemable noncontrolling interest

 
4

 
3,762

 

 
3,766

Equity:
 
 
 
 
 
 
 
 
 
Era Group Inc. stockholders’ equity:
 
 
 
 
 
 
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,936,636 outstanding, exclusive of treasury shares
215

 

 

 

 
215

Additional paid-in capital
443,944

 
100,306

 
4,562

 
(104,868
)
 
443,944

Retained earnings
4,363

 
92,034

 
(35,552
)
 
(56,482
)
 
4,363

Treasury shares, at cost, 214,441 shares
(2,951
)
 

 

 

 
(2,951
)
Accumulated other comprehensive income, net of tax

 
110

 

 

 
110

Total equity
445,571

 
192,450

 
(30,990
)
 
(161,350
)
 
445,681

Total liabilities, redeemable noncontrolling interest and stockholders’ equity
$
619,916

 
$
752,706

 
$
27,231

 
$
(607,756
)
 
$
792,097

Supplemental Condensed Consolidating Statements of Operations for the Year Ended December 31, 2018
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Revenues
$

 
$
194,932

 
$
55,625

 
$
(28,881
)
 
$
221,676

Costs and expenses:
 
 
 
 
 
 
 
 
 
Operating

 
122,490

 
57,947

 
(28,914
)
 
151,523

Administrative and general
15,017

 
25,597

 
4,512

 

 
45,126

Depreciation

 
38,553

 
988

 

 
39,541

Total costs and expenses
15,017

 
186,640

 
63,447

 
(28,914
)
 
236,190

Gains on asset dispositions, net

 
1,618

 
(43
)
 

 
1,575

Litigation settlement proceeds
42,000

 

 

 

 
42,000

Loss on impairment

 
(991
)
 

 

 
(991
)
Operating income (loss)
26,983

 
8,919

 
(7,865
)
 
33

 
28,070

Other income (expense):
 
 
 
 
 
 
 
 
 
Interest income
395

 
1,371

 
276

 

 
2,042

Interest expense
(14,149
)
 
(802
)
 
(180
)
 

 
(15,131
)
Foreign currency gains, net
(95
)
 
(178
)
 
(745
)
 

 
(1,018
)
Gain on debt extinguishment

 

 
175

 

 
175

Other, net

 
34

 
20

 

 
54

Total other income (expense)
(13,849
)
 
425

 
(454
)
 

 
(13,878
)
Income (loss) before income taxes and equity earnings
13,134

 
9,344

 
(8,319
)
 
33

 
14,192

Income tax expense (benefit)
10,845

 
(7,900
)
 
(5
)
 

 
2,940

Income (loss) before equity earnings
2,289

 
17,244

 
(8,314
)
 
33

 
11,252

Equity in earnings (losses) of subsidiaries
11,601

 
2,206

 

 
(11,601
)
 
2,206

Net income (loss)
13,890

 
19,450

 
(8,314
)
 
(11,568
)
 
13,458

Net loss attributable to non-controlling interest in subsidiary

 

 
464

 

 
464

Net income (loss) attributable to Era Group Inc.
$
13,890

 
$
19,450

 
$
(7,850
)
 
$
(11,568
)
 
$
13,922

Supplemental Condensed Consolidating Statements of Operations for the Year Ended December 31, 2017
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Revenues
$

 
$
201,653

 
$
60,466

 
$
(30,798
)
 
$
231,321

Costs and expenses:
 
 
 
 
 
 
 
 
 
Operating

 
133,077

 
65,167

 
(30,798
)
 
167,446

Administrative and general
7,887

 
28,451

 
5,754

 

 
42,092

Depreciation

 
44,756

 
980

 

 
45,736

Total costs and expenses
7,887

 
206,284

 
71,901

 
(30,798
)
 
255,274

Gains on asset dispositions, net

 
4,364

 
143

 

 
4,507

Loss on impairment

 
(116,586
)
 
(432
)
 

 
(117,018
)
Operating income (loss)
(7,887
)
 
(116,853
)
 
(11,724
)
 

 
(136,464
)
Other income (expense):
 
 
 
 
 
 
 
 
 
Interest income
108

 
419

 
233

 

 
760

Interest expense
(14,495
)
 
(800
)
 
(1,468
)
 

 
(16,763
)
Foreign currency gains, net
256

 
330

 
(812
)
 

 
(226
)
Other, net

 
143

 
(155
)
 

 
(12
)
Total other income (expense)
(14,131
)
 
92

 
(2,202
)
 

 
(16,241
)
Income (loss) before income taxes and equity earnings
(22,018
)
 
(116,761
)
 
(13,926
)
 

 
(152,705
)
Income tax expense (benefit)
(7,338
)
 
(112,295
)
 
(3,032
)
 

 
(122,665
)
Income (loss) before equity earnings
(14,680
)
 
(4,466
)
 
(10,894
)
 

 
(30,040
)
Equity earnings, net of tax


 
1,425

 

 


 
1,425

Equity in earnings (losses) of subsidiaries
(13,481
)
 

 

 
13,481

 

Net income (loss)
(28,161
)
 
(3,041
)
 
(10,894
)
 
13,481

 
(28,615
)
Net loss attributable to non-controlling interest in subsidiary

 

 
454

 

 
454

Net income (loss) attributable to Era Group Inc.
$
(28,161
)
 
$
(3,041
)
 
$
(10,440
)
 
$
13,481

 
$
(28,161
)
Supplemental Condensed Consolidating Statements of Operations for the Year Ended December 31, 2016
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Revenues
$

 
$
225,773

 
$
61,514

 
$
(40,059
)
 
$
247,228

Costs and expenses:
 
 
 
 
 
 
 
 
 
Operating

 
138,350

 
71,572

 
(40,059
)
 
169,863

Administrative and general
3,744

 
27,834

 
4,628

 

 
36,206

Depreciation

 
48,248

 
1,067

 

 
49,315

Total costs and expenses
3,744

 
214,432

 
77,267

 
(40,059
)
 
255,384

Gains on asset dispositions, net

 
5,035

 
(248
)
 

 
4,787

Operating income
(3,744
)
 
16,376

 
(16,001
)
 

 
(3,369
)
Other income (expense):
 
 
 
 
 
 
 
 
 
Interest income
56

 
472

 
213

 

 
741

Interest expense
(16,033
)
 
(809
)
 
(483
)
 

 
(17,325
)
Foreign currency gains (losses), net
(77
)
 
(879
)
 
963

 

 
7

Gain on debt extinguishment
518

 

 

 

 
518

Other, net

 
11

 
58

 

 
69

Total other income (expense)
(15,536
)
 
(1,205
)
 
751

 

 
(15,990
)
Income (loss) before income taxes and equity earnings
(19,280
)
 
15,171

 
(15,250
)
 

 
(19,359
)
Income tax expense (benefit)
(8,807
)
 
4,971

 
479

 

 
(3,357
)
Income (loss) before equity earnings
(10,473
)
 
10,200

 
(15,729
)
 

 
(16,002
)
Equity earnings, net of tax

 
1,092

 

 

 
1,092

Equity in earnings (losses) of subsidiaries
2,495

 

 

 
(2,495
)
 

Net income (loss)
(7,978
)
 
11,292

 
(15,729
)
 
(2,495
)
 
(14,910
)
Net income attributable to non-controlling interest in subsidiary

 
6,349

 
583

 

 
6,932

Net income (loss) attributable to Era Group Inc.
$
(7,978
)
 
$
17,641

 
$
(15,146
)
 
$
(2,495
)
 
$
(7,978
)
Supplemental Condensed Consolidating Statements of Comprehensive Income for the Year Ended December 31, 2018
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net income (loss)
$
13,890

 
$
19,450

 
$
(8,314
)
 
$
(11,568
)
 
$
13,458

Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments

 

 

 

 

Income tax benefit

 

 

 

 

Total other comprehensive income (loss)

 

 

 

 

Comprehensive income (loss)
13,890

 
19,450

 
(8,314
)
 
(11,568
)
 
13,458

Comprehensive loss attributable to non-controlling interest in subsidiary

 

 
464

 

 
464

Comprehensive income (loss) attributable to Era Group Inc.
$
13,890

 
$
19,450

 
$
(7,850
)
 
$
(11,568
)
 
$
13,922


Supplemental Condensed Consolidating Statements of Comprehensive Income for the Year Ended December 31, 2017
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net income (loss)
$
(28,161
)
 
$
(3,041
)
 
$
(10,894
)
 
$
13,481

 
$
(28,615
)
Other comprehensive loss:
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments

 
18

 

 

 
18

Income tax benefit

 

 

 

 

Total other comprehensive loss

 
18

 

 

 
18

Comprehensive income (loss)
(28,161
)
 
(3,023
)
 
(10,894
)
 
13,481

 
(28,597
)
Comprehensive loss attributable to non-controlling interest in subsidiary

 

 
454

 

 
454

Comprehensive income (loss) attributable to Era Group Inc.
$
(28,161
)
 
$
(3,023
)
 
$
(10,440
)
 
$
13,481

 
$
(28,143
)

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Year Ended December 31, 2016
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net income (loss)
$
(7,978
)
 
$
11,292

 
$
(15,729
)
 
$
(2,495
)
 
$
(14,910
)
Other comprehensive loss:
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments

 

 

 

 

Income tax benefit

 

 

 

 

Total other comprehensive loss

 

 

 

 

Comprehensive income (loss)
(7,978
)
 
11,292

 
(15,729
)
 
(2,495
)
 
(14,910
)
Comprehensive loss attributable to non-controlling interest in subsidiary

 
6,349

 
583

 

 
6,932

Comprehensive income (loss) attributable to Era Group Inc.
$
(7,978
)
 
$
17,641

 
$
(15,146
)
 
$
(2,495
)
 
$
(7,978
)
Supplemental Condensed Consolidating Statements of Cash Flows for the Year Ended December 31, 2018
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net cash provided by operating activities
$
37,596

 
$
14,639

 
$
2,119

 
$

 
$
54,354

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
Purchases of property and equipment

 
(8,867
)
 
(349
)
 

 
(9,216
)
Proceeds from disposition of property and equipment

 
29,590

 

 

 
29,590

Dividends received from equity investees


 
1,000

 

 

 
1,000

Principal payments on notes due from equity investees

 
518

 

 

 
518

Principal payments on third party notes receivable

 
934

 

 

 
934

Net cash provided by investing activities

 
23,175

 
(349
)
 

 
22,826

Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
Long-term debt issuance costs


 

 

 
(1,295
)
 
(1,295
)
Payments on long-term debt

 
(1,662
)
 
(1,224
)
 
(39,000
)
 
(41,886
)
Proceeds from share award plans

 

 

 
893

 
893

Extinguishment of long-term debt


 

 
(1,221
)
 

 
(1,221
)
Borrowings and repayments of intercompany debt

 
(39,402
)
 

 
39,402

 

Net cash used in financing activities

 
(41,064
)
 
(2,445
)
 

 
(43,509
)
Effects of exchange rate changes on cash, cash equivalents and restricted cash

 

 
249

 

 
249

Net increase (decrease) in cash, cash equivalents and restricted cash
37,596

 
(3,250
)
 
(426
)
 

 
33,920

Cash, cash equivalents and restricted cash, beginning of year
10,800

 
3,250

 
2,783

 

 
16,833

Cash, cash equivalents and restricted cash, end of year
$
48,396

 
$

 
$
2,357

 
$

 
$
50,753


Supplemental Condensed Consolidating Statements of Cash Flows for the Year Ended December 31, 2017
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net cash provided by (used in) operating activities
$
(14,706
)
 
$
32,601

 
$
2,201

 
$

 
$
20,096

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
Purchases of property and equipment

 
(16,600
)
 
(170
)
 

 
(16,770
)
Proceeds from disposition of property and equipment

 
9,392

 

 

 
9,392

Principal payments on notes due from equity investees

 
761

 

 

 
761

Investments in and advances to equity investees

 
(126
)
 

 

 
(126
)
Principal payments on third party notes receivable

 
169

 

 

 
169

Escrow deposits on like-kind exchanges, net

 

 

 

 

Net cash used in investing activities

 
(6,404
)
 
(170
)
 

 
(6,574
)
Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
Proceeds from Revolving Credit Facility

 
8,000

 

 
9,000

 
17,000

Payments on long-term debt

 
(1,526
)
 
(755
)
 
(43,000
)
 
(45,281
)
Proceeds from share award plans

 

 

 
836

 
836

Purchase of treasury shares

 

 

 
(52
)
 
(52
)
Borrowings and repayments of intercompany debt

 
(33,216
)
 

 
33,216

 

Net cash used in financing activities

 
(26,742
)
 
(755
)
 

 
(27,497
)
Effects of exchange rate changes on cash, cash equivalents and restricted cash
32

 
18

 
31

 

 
81

Net increase (decrease) in cash, cash equivalents and restricted cash
(14,674
)
 
(527
)
 
1,307

 

 
(13,894
)
Cash, cash equivalents and restricted cash, beginning of year
25,474

 
3,777

 
1,476

 

 
30,727

Cash, cash equivalents and restricted cash, end of year
$
10,800

 
$
3,250

 
$
2,783

 
$

 
$
16,833



Supplemental Condensed Consolidating Statements of Cash Flows for the Year Ended December 31, 2016
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net cash provided by (used in) operating activities
$
17,909

 
$
41,239

 
$
(644
)
 
$

 
$
58,504

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
Purchases of property and equipment

 
(39,020
)
 
(180
)
 

 
(39,200
)
Proceeds from disposition of property and equipment

 
28,381

 
228

 

 
28,609

Return of helicopter deposits

 
544

 

 

 
544

Principal payments on notes due from equity investees

 
723

 

 

 
723

Principal payments on third party notes receivable

 
208

 

 

 
208

Escrow deposits, net

 

 

 

 

Repayment of intercompany debt

 

 

 

 

Net cash used in investing activities

 
(9,164
)
 
48

 

 
(9,116
)
Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
Proceeds from Revolving Credit Facility

 

 

 
12,000

 
12,000

Long-term debt issuance costs

 

 

 
(886
)
 
(886
)
Payments on long-term debt

 
(1,803
)
 
(1,641
)
 
(37,000
)
 
(40,444
)
Extinguishment of long-term debt

 

 

 
(4,331
)
 
(4,331
)
Proceeds from share award plans

 

 

 
836

 
836

Purchase of treasury shares

 

 

 
(161
)
 
(161
)
Repayment of intercompany debt

 
(29,542
)
 

 
29,542

 

Net cash provided by financing activities

 
(31,345
)
 
(1,641
)
 

 
(32,986
)
Effects of exchange rate changes on cash, cash equivalents and restricted cash

 
(478
)
 
242

 

 
(236
)
Net increase (decrease) in cash, cash equivalents and restricted cash
17,909


252

 
(1,995
)
 

 
16,166

Cash, cash equivalents and restricted cash, beginning of year
7,565

 
3,525

 
3,471

 

 
14,561

Cash, cash equivalents and restricted cash, end of year
$
25,474

 
$
3,777

 
$
1,476

 
$

 
$
30,727