Quarterly report pursuant to Section 13 or 15(d)

GUARANTORS OF SECURITIES

v3.5.0.2
GUARANTORS OF SECURITIES
9 Months Ended
Sep. 30, 2016
Guarantees [Abstract]  
GUARANTORS OF SECURITIES
GUARANTORS OF SECURITIES
On December 7, 2012, Era Group issued the 7.750% Senior Notes. 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 these subsidiaries to guarantee the 7.750% Senior Notes, the Company is presenting 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 unaudited condensed consolidated financial statements of the Company. The supplemental condensed consolidating financial information has been prepared pursuant to the rules and regulations for condensed financial information and does not include all disclosures included in annual financial statements.
Supplemental Condensed Consolidating Balance Sheet as of September 30, 2016
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands, except share data)
ASSETS
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
28,692

 
$
1,602

 
$
1,850

 
$

 
$
32,144

Receivables:
 
 
 
 
 
 
 
 
 
Trade, net of allowance for doubtful accounts of $1,214
39

 
27,871

 
6,390

 

 
34,300

Other

 
5,362

 
1,128

 

 
6,490

Inventories, net

 
26,352

 
263

 

 
26,615

Prepaid expenses
439

 
1,231

 
129

 

 
1,799

Other current assets
190

 

 

 

 
190

Total current assets
29,360

 
62,418

 
9,760

 

 
101,538

Property and equipment

 
1,159,147

 
15,984

 

 
1,175,131

Accumulated depreciation

 
(345,877
)
 
(1,236
)
 

 
(347,113
)
Property and equipment, net

 
813,270

 
14,748

 

 
828,018

Equity investments and advances

 
29,595

 

 

 
29,595

Investments in consolidated subsidiaries
181,394

 

 

 
(181,394
)
 

Intangible assets

 

 
1,141

 

 
1,141

Deferred taxes
5,771

 

 

 
(5,771
)
 

Intercompany receivables
469,301

 

 

 
(469,301
)
 

Other assets
1,659

 
5,308

 
4,210

 

 
11,177

Total assets
$
687,485

 
$
910,591

 
$
29,859

 
$
(656,466
)
 
$
971,469

LIABILITIES, REDEEMABLE NONCONTROLLING INTREST AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
$
139

 
$
7,207

 
$
1,786

 
$

 
$
9,132

Accrued wages and benefits

 
6,583

 
2,494

 

 
9,077

Accrued interest
3,363

 

 

 

 
3,363

Accrued income taxes

 
536

 
14

 

 
550

Accrued other taxes
30

 
1,109

 
1,172

 

 
2,311

Accrued contingencies

 

 
1,543

 

 
1,543

Current portion of long-term debt

 
1,524

 
15

 

 
1,539

Other current liabilities
647

 
1,789

 
34

 

 
2,470

Total current liabilities
4,179

 
18,748

 
7,058

 

 
29,985

Long-term debt
210,597

 
22,058

 

 

 
232,655

Deferred income taxes

 
232,510

 
678

 
(5,771
)
 
227,417

Intercompany payables

 
436,996

 
32,305

 
(469,301
)
 

Other liabilities

 
1,246

 
3,034

 

 
4,280

Total liabilities
214,776

 
711,558

 
43,075

 
(475,072
)
 
494,337

Redeemable noncontrolling interest

 
4

 
4,327

 

 
4,331

Equity:
 
 
 
 
 
 
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,940,372 outstanding, exclusive of treasury shares
211

 

 

 

 
211

Additional paid-in capital
437,291

 
100,306

 
4,562

 
(104,868
)
 
437,291

Retained earnings
38,062

 
98,631

 
(22,105
)
 
(76,526
)
 
38,062

Treasury shares, at cost, 171,614 shares
(2,855
)
 

 

 

 
(2,855
)
Accumulated other comprehensive income, net of tax

 
92

 

 

 
92

Total equity
472,709

 
199,029

 
(17,543
)
 
(181,394
)
 
472,801

Total liabilities, redeemable noncontrolling interest and stockholders’ equity
$
687,485

 
$
910,591

 
$
29,859

 
$
(656,466
)
 
$
971,469

Supplemental Condensed Consolidating Balance Sheet as of December 31, 2015
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands, except share data)
ASSETS
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
7,565

 
$
3,334

 
$
3,471

 
$

 
$
14,370

Receivables:
 
 
 
 
 
 
 
 
 
Trade, net of allowance for doubtful accounts of $2,103
39

 
40,345

 
8,255

 

 
48,639

Tax receivables
6,013

 
72

 

 

 
6,085

Other

 
3,089

 
216

 

 
3,305

Inventories, net

 
25,557

 
2,437

 

 
27,994

Prepaid expenses
458

 
1,411

 
94

 

 
1,963

Other current assets
190

 
1

 

 

 
191

Total current assets
14,265

 
73,809

 
14,473

 

 
102,547

Property and equipment

 
1,159,441

 
16,468

 

 
1,175,909

Accumulated depreciation

 
(316,090
)
 
(603
)
 

 
(316,693
)
Net property and equipment

 
843,351

 
15,865

 

 
859,216

Equity investments and advances

 
28,898

 

 

 
28,898

Investments in consolidated subsidiaries
172,335

 

 

 
(172,335
)
 

Intangible assets

 

 
1,158

 

 
1,158

Deferred income taxes
3,823

 

 

 
(3,823
)
 

Intercompany receivables
515,255

 

 

 
(515,255
)
 

Other assets
2,166

 
6,999

 
3,367

 

 
12,532

Total assets
$
707,844

 
$
953,057

 
$
34,863

 
$
(691,413
)
 
$
1,004,351

LIABILITIES, REDEEMABLE NONCONTROLLING INTREST AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
$
386

 
$
9,635

 
$
1,979

 
$

 
$
12,000

Accrued wages and benefits

 
6,875

 
2,137

 

 
9,012

Accrued interest
549

 
13

 

 

 
562

Current portion of long-term debt

 
1,663

 
1,615

 

 
3,278

Accrued other taxes
30

 
789

 
1,701

 

 
2,520

Accrued contingencies

 

 
2,410

 

 
2,410

Other current liabilities
534

 
1,311

 
455

 

 
2,300

Total current liabilities
1,499

 
20,286

 
10,297

 

 
32,082

Long-term debt
235,134

 
23,305

 
5,259

 

 
263,698

Deferred income taxes

 
232,994

 
677

 
(3,823
)
 
229,848

Intercompany payables

 
501,512

 
13,743

 
(515,255
)
 

Other liabilities

 
1,887

 
729

 

 
2,616

Total liabilities
236,633

 
779,984

 
30,705

 
(519,078
)
 
528,244

Redeemable noncontrolling interest

 
4

 
4,800

 

 
4,804

Equity:
 
 
 
 
 
 
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,495,694 outstanding, exclusive of treasury shares
207

 

 

 

 
207

Additional paid-in capital
433,175

 
95,543

 
9,325

 
(104,868
)
 
433,175

Retained earnings
40,502

 
77,434

 
(9,967
)
 
(67,467
)
 
40,502

Treasury shares, at cost, 154,549 shares
(2,673
)
 

 

 

 
(2,673
)
Accumulated other comprehensive income, net of tax

 
92

 

 

 
92

Total equity
471,211

 
173,069

 
(642
)
 
(172,335
)
 
471,303

Total liabilities, redeemable noncontrolling interest and stockholders’ equity
$
707,844

 
$
953,057

 
$
34,863

 
$
(691,413
)
 
$
1,004,351

Supplemental Condensed Consolidating Statements of Operations for the Three Months Ended September 30, 2016
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Operating revenues
$

 
$
59,130

 
$
15,786

 
$
(9,910
)
 
$
65,006

Costs and expenses:
 
 
 
 
 
 
 
 
 
Operating

 
31,759

 
18,522

 
(9,910
)
 
40,371

Administrative and general
738

 
7,274

 
1,492

 

 
9,504

Depreciation

 
12,244

 
275

 

 
12,519

Total costs and expenses
738

 
51,277

 
20,289

 
(9,910
)
 
62,394

Gains on asset dispositions, net

 
2

 
(248
)
 

 
(246
)
Operating income (loss)
(738
)
 
7,855

 
(4,751
)
 

 
2,366

Other income (expense):
 
 
 
 
 
 
 
 
 
Interest income
24

 
116

 
326

 

 
466

Interest expense
(3,581
)
 
(387
)
 
(35
)
 

 
(4,003
)
Foreign currency gains (losses), net
28

 
82

 
(143
)
 

 
(33
)
Other, net

 
1

 
33

 

 
34

Total other income (expense)
(3,529
)
 
(188
)
 
181

 

 
(3,536
)
Income (loss) before income taxes and equity earnings
(4,267
)
 
7,667

 
(4,570
)
 

 
(1,170
)
Income tax expense (benefit)
(604
)
 
673

 

 

 
69

Income (loss) before equity earnings
(3,663
)
 
6,994

 
(4,570
)
 

 
(1,239
)
Equity earnings, net of tax

 
437

 

 

 
437

Equity in earnings (losses) of subsidiaries
3,103

 

 

 
(3,103
)
 

Net income (loss)
(560
)
 
7,431

 
(4,570
)
 
(3,103
)
 
(802
)
Net loss attributable to noncontrolling interest in subsidiary

 

 
242

 

 
242

Net income (loss) attributable to Era Group Inc.
$
(560
)
 
$
7,431

 
$
(4,328
)
 
$
(3,103
)
 
$
(560
)
Supplemental Condensed Consolidating Statements of Operations for the Three Months Ended September 30, 2015
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Operating revenues
$

 
$
69,491

 
$
655

 
$
(405
)
 
$
69,741

Costs and expenses:
 
 
 
 
 
 
 
 
 
Operating

 
42,812

 
600

 
(405
)
 
43,007

Administrative and general
1,773

 
9,329

 
136

 

 
11,238

Depreciation

 
11,674

 
512

 

 
12,186

Total costs and expenses
1,773

 
63,815

 
1,248

 
(405
)
 
66,431

Gains on asset dispositions, net

 
1,813

 

 

 
1,813

Operating income
(1,773
)
 
7,489

 
(593
)
 

 
5,123

Other income (expense):
 
 
 
 
 
 
 
 
 
Interest income
4

 
228

 

 

 
232

Interest expense
(2,801
)
 
(298
)
 
(22
)
 

 
(3,121
)
Intercompany interest income (expense)

 
165

 
(165
)
 

 

Derivative losses, net

 
8

 

 

 
8

Foreign currency gains (losses), net
4

 
75

 
67

 

 
146

Gain on debt extinguishment
(16
)
 

 

 

 
(16
)
Total other income (expense)
(2,809
)
 
178

 
(120
)
 

 
(2,751
)
Income (loss) before income taxes and equity earnings
(4,582
)
 
7,667

 
(713
)
 

 
2,372

Income tax expense (benefit)
(2,593
)
 
4,340

 
(404
)
 

 
1,343

Income (loss) before equity earnings
(1,989
)
 
3,327

 
(309
)
 

 
1,029

Equity losses, net of tax

 
(376
)
 

 

 
(376
)
Equity in earnings (losses) of subsidiaries
2,850

 

 

 
(2,850
)
 

Net income (loss)
861

 
2,951

 
(309
)
 
(2,850
)
 
653

Net loss attributable to noncontrolling interest in subsidiary

 
49

 
159

 

 
208

Net income (loss) attributable to Era Group Inc.
$
861

 
$
3,000

 
$
(150
)
 
$
(2,850
)
 
$
861

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Three Months Ended September 30, 2016
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net income (loss)
$
(560
)
 
$
7,431

 
$
(4,570
)
 
$
(3,103
)
 
$
(802
)
Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments

 

 

 

 

Income tax benefit

 

 

 

 

Total other comprehensive income (loss)

 

 

 

 

Comprehensive income (loss)
(560
)
 
7,431

 
(4,570
)
 
(3,103
)
 
(802
)
Comprehensive loss attributable to noncontrolling interest in subsidiary

 

 
242

 

 
242

Comprehensive income (loss) attributable to Era Group Inc.
$
(560
)
 
$
7,431

 
$
(4,328
)
 
$
(3,103
)
 
$
(560
)

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Three Months Ended September 30, 2015
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net income (loss)
$
861

 
$
2,951

 
$
(309
)
 
$
(2,850
)
 
$
653

Other comprehensive loss:
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments

 
(1
)
 
137

 

 
136

Income tax benefit

 

 

 

 

Total other comprehensive loss

 
(1
)
 
137

 

 
136

Comprehensive income (loss)
861

 
2,950

 
(172
)
 
(2,850
)
 
789

Comprehensive income attributable to noncontrolling interest in subsidiary

 
49

 
159

 

 
208

Comprehensive income (loss) attributable to Era Group Inc.
$
861

 
$
2,999

 
$
(13
)
 
$
(2,850
)
 
$
997

Supplemental Condensed Consolidating Statements of Cash Flows for the Nine Months Ended September 30, 2016
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net cash provided by (used in) operating activities
$
21,127

 
$
26,296

 
$
(940
)
 
$

 
$
46,483

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
Purchases of property and equipment

 
(10,537
)
 
(175
)
 

 
(10,712
)
Proceeds from disposition of property and equipment

 
5,910

 
228

 

 
6,138

Return of helicopter deposit

 
544

 

 

 
544

Principal payments on notes due from equity investees

 
539

 

 

 
539

Principal payments on third party notes receivable

 
212

 

 

 
212

Net cash provided by (used in) investing activities

 
(3,332
)
 
53

 

 
(3,279
)
Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
Payments on long-term debt

 
(1,386
)
 
(1,152
)
 
(27,000
)
 
(29,538
)
Proceeds from Revolving Credit Facility

 

 

 
7,000

 
7,000

Extinguishment of long-term debt

 

 

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

 

 

 
836

 
836

Purchase of treasury shares

 

 

 
(161
)
 
(161
)
Borrowings and repayments of intercompany debt

 
(23,656
)
 

 
23,656

 

Net cash used in financing activities

 
(25,042
)
 
(1,152
)
 

 
(26,194
)
Effects of exchange rate changes on cash and cash equivalents

 
346

 
418

 

 
764

Net increase (decrease) in cash and cash equivalents
21,127

 
(1,732
)
 
(1,621
)
 

 
17,774

Cash and cash equivalents, beginning of period
7,565

 
3,334

 
3,471

 

 
14,370

Cash and cash equivalents, end of period
$
28,692

 
$
1,602

 
$
1,850

 
$

 
$
32,144


Supplemental Condensed Consolidating Statements of Cash Flows for the Nine Months Ended September 30, 2015
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net cash provided by (used in) operating activities
$
(5,604
)
 
$
25,718

 
$
15,729

 
$

 
$
35,843

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
Purchases of property and equipment

 
(47,257
)
 
(11,773
)
 
11,770

 
(47,260
)
Proceeds from disposition of property and equipment

 
32,401

 

 
(11,770
)
 
20,631

Cash settlements on forward contracts, net

 

 

 
(1,103
)
 
(1,103
)
Business acquisitions, net of cash acquired

 

 
(3,165
)
 

 
(3,165
)
Proceeds from sale of FBO

 

 

 
14,252

 
14,252

Principal payments on notes due from equity investees

 
514

 

 

 
514

Principal payments on third party notes receivable

 
25

 

 

 
25

Escrow deposits, net

 
(150
)
 

 
(190
)
 
(340
)
Escrow deposits on like-kind exchanges, net

 
(1,857
)
 

 

 
(1,857
)
Borrowings and repayments of intercompany debt

 
12,959

 

 
(12,959
)
 

Net cash used in investing activities

 
(3,365
)
 
(14,938
)
 

 
(18,303
)
Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
Payments on long-term debt

 
(2,091
)
 
(58
)
 
(50,000
)
 
(52,149
)
Proceeds from Revolving Credit Facility

 

 

 
35,000

 
35,000

Extinguishment of long-term debt

 

 

 
(24,335
)
 
(24,335
)
Proceeds from share award plans

 

 

 
1,096

 
1,096

Purchase of treasury shares

 

 

 
(2,069
)
 
(2,069
)
Tax expense on vested restricted stock

 

 

 
(114
)
 
(114
)
Borrowings and repayments of intercompany debt

 
(40,422
)
 

 
40,422

 

Net cash used in financing activities

 
(42,513
)
 
(58
)
 

 
(42,571
)
Effects of exchange rate changes on cash and cash equivalents

 
(2,028
)
 

 

 
(2,028
)
Net increase (decrease) in cash and cash equivalents
(5,604
)
 
(22,188
)
 
733

 

 
(27,059
)
Cash and cash equivalents, beginning of period
16,481

 
22,188

 
2,198

 

 
40,867

Cash and cash equivalents, end of period
$
10,877

 
$

 
$
2,931

 
$

 
$
13,808