Bristow Group Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

GUARANTORS OF SECURITIES

GUARANTORS OF SECURITIES

9 Months Ended

Sep. 30, 2019

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 September 30, 2019



	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands, except share data)
ASSETS
Current assets:
Cash and cash equivalents	$	105,639		$	—		$	2,097		$	—		$	107,736
Receivables:
Trade, operating, net of allowance for doubtful accounts of $176	—			24,779			6,533			—			31,312
Trade, dry-leasing	—			5,864			—			—			5,864
Tax receivable	—			10			2,695			—			2,705
Other	—			11,305			262			—			11,567
Inventories, net	—			20,784			42			—			20,826
Prepaid expenses	565			2,046			240			—			2,851
Total current assets	106,204			64,788			11,869			—			182,861
Property and equipment	—			884,816			16,764			—			901,580
Accumulated depreciation	—			(330,543		)	(4,187		)	—			(334,730		)
Property and equipment, net	—			554,273			12,577			—			566,850
Operating lease right-of-use	—			8,095			1,812			—			9,907
Investments in consolidated subsidiaries	183,226			—			—			(183,226		)	—
Intangible assets	—			—			1,094			—			1,094
Deferred income taxes	12,774			—			—			(12,774		)	—
Intercompany receivables	294,405			—			47			(294,452		)	—
Other assets	815			5,145			403			—			6,363
Total assets	$	597,424		$	632,301		$	27,802		$	(490,452	)	$	767,075
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses	$	134		$	10,247		$	1,559		$	—		$	11,940
Accrued wages and benefits	32			7,216			1,712			—			8,960
Accrued interest	3,261			60			—			—			3,321
Accrued income taxes	2,922			10			13			—			2,945
Accrued other taxes	—			1,693			293			—			1,986
Accrued contingencies	—			—			548			—			548
Current portion of long-term debt	—			1,663			182			—			1,845
Other current liabilities	885			1,585			381			—			2,851
Total current liabilities	7,234			22,474			4,688			—			34,396
Long-term debt	133,662			25,069			—			—			158,731
Deferred income taxes	—			116,968			1,246			(12,774		)	105,440
Intercompany payables	—			231,203			63,271			(294,474		)	—
Operating lease liabilities	—			6,731			1,435			—			8,166
Other liabilities	—			850			—			—			850
Total liabilities	140,896			403,295			70,640			(307,248		)	307,583
Redeemable noncontrolling interest	—			3			2,942			—			2,945
Equity:
Common stock, $0.01 par value, 60,000,000 shares authorized; 21,288,619 outstanding, exclusive of treasury shares	224			—			—			—			224
Additional paid-in capital	451,104			100,307			4,561			(104,869		)	451,103
Retained earnings	15,352			128,696			(50,341		)	(78,335		)	15,372
Treasury shares, at cost, 1,149,820 shares	(10,152		)	—			—			—			(10,152		)
Total equity	456,528			229,003			(45,780		)	(183,204		)	456,547
Total liabilities, redeemable noncontrolling interest and stockholders’ equity	$	597,424		$	632,301		$	27,802		$	(490,452	)	$	767,075

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
Accrued other taxes	—			768			500			—			1,268
Accrued contingencies	—			—			630			—			630
Current portion of long-term debt	—			1,663			395			—			2,058
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:
Common stock, $0.01 par value, 60,000,000 shares authorized; 21,765,404 shares 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 Statements of Operations for the Three Months Ended September 30, 2019



	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands)
Revenues	$	—		$	53,633		$	14,681		$	(9,405	)	$	58,909
Costs and expenses:
Operating	—			32,926			16,001			(9,405		)	39,522
Administrative and general	1,025			7,177			940			—			9,142
Depreciation	—			9,100			212			—			9,312
Total costs and expenses	1,025			49,203			17,153			(9,405		)	57,976
Gains on asset dispositions, net	—			754			—			—			754
Operating income (loss)	(1,025		)	5,184			(2,472		)	—			1,687
Other income (expense):
Interest income	492			444			20			—			956
Interest expense	(3,263		)	(193		)	(8		)	—			(3,464		)
Foreign currency gains, net	(81		)	(104		)	(533		)	—			(718		)
Other, net	(4		)	5			(6		)	—			(5		)
Total other income (expense)	(2,856		)	152			(527		)	—			(3,231		)
Income (loss) before income taxes and equity earnings	(3,881		)	5,336			(2,999		)	—			(1,544		)
Income tax (benefit) expense	(432		)	947			—			—			515
Income (loss) before equity earnings	(3,449		)	4,389			(2,999		)	—			(2,059		)
Equity in earnings (losses) of subsidiaries	1,541			—			—			(1,541		)	—
Net income (loss)	(1,908		)	4,389			(2,999		)	(1,541		)	(2,059		)
Net loss attributable to noncontrolling interest in subsidiary	—			—			149			—			149
Net income (loss) attributable to Era Group Inc.	$	(1,908	)	$	4,389		$	(2,850	)	$	(1,541	)	$	(1,910	)

Supplemental Condensed Consolidating Statements of Operations for the Three Months Ended September 30, 2018



	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands)
Revenues	$	—		$	48,631		$	13,623		$	(7,644	)	$	54,610
Costs and expenses:
Operating	—			29,888			14,302			(7,677		)	36,513
Administrative and general	901			6,957			979			—			8,837
Depreciation	—			9,316			225			—			9,541
Total costs and expenses	901			46,161			15,506			(7,677		)	54,891
Losses on asset dispositions, net	—			(148		)	—			—			(148		)
Litigation settlement proceeds	42,000			—			—			—			42,000
Operating income (loss) loss	41,099			2,322			(1,883		)	33			41,571
Other income (expense):
Interest income	171			448			113			—			732
Interest expense	(3,330		)	(204		)	(15		)	—			(3,549		)
Foreign currency losses, net	(10		)	(16		)	(68		)	—			(94		)
Other, net	—			21			(6		)	—			15
Total other income (expense)	(3,169		)	249			24			—			(2,896		)
Income (loss) before income taxes and equity earnings	37,930			2,571			(1,859		)	33			38,675
Income tax expense	3,928			3,933			—			—			7,861
Income (loss) before equity earnings	34,002			(1,362		)	(1,859		)	33			30,814
Equity in earnings (losses) of subsidiaries	(2,747		)	465			—			2,747			465
Net income (loss)	31,255			(897		)	(1,859		)	2,780			31,279
Net loss attributable to noncontrolling interest in subsidiary	—			—			10			—			10
Net income (loss) attributable to Era Group Inc.	$	31,255		$	(897	)	$	(1,849	)	$	2,780		$	31,289

Supplemental Condensed Consolidating Statements of Operations for the Nine Months Ended September 30, 2019



	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands)
Revenues	$	—		$	148,992		$	42,835		$	(26,145	)	$	165,682
Costs and expenses:
Operating	—			94,977			46,195			(26,134		)	115,038
Administrative and general	4,009			20,135			2,768			—			26,912
Depreciation	—			27,572			710			—			28,282
Total costs and expenses	4,009			142,684			49,673			(26,134		)	170,232
Gains on asset dispositions, net	—			562			—			—			562
Operating income (loss)	(4,009		)	6,870			(6,838		)	(11		)	(3,988		)
Other income (expense):
Interest income	1,135			1,423			84			—			2,642
Interest expense	(9,721		)	(614		)	(22		)	—			(10,357		)
Loss on sale of investments	(569		)	—			—			—			(569		)
Foreign currency gains, net	(93		)	15			(496		)	—			(574		)
Loss on debt extinguishment	(13		)	—			—			—			(13		)
Other, net	(20		)	16			(21		)	—			(25		)
Total other income (expense)	(9,281		)	840			(455		)	—			(8,896		)
Income (loss) before income taxes and equity earnings	(13,290		)	7,710			(7,293		)	(11		)	(12,884		)
Income tax expense (benefit)	(114		)	435			—			—			321
Income (loss) before equity earnings	(13,176		)	7,275			(7,293		)	(11		)	(13,205		)
Equity in earnings (losses) of subsidiaries	10,275			9,935			—			(10,275		)	9,935
Net income (loss)	(2,901		)	17,210			(7,293		)	(10,286		)	(3,270		)
Net loss attributable to noncontrolling interest in subsidiary	—			—			357			—			357
Net income (loss) attributable to Era Group Inc.	$	(2,901	)	$	17,210		$	(6,936	)	$	(10,286	)	$	(2,913	)

Supplemental Condensed Consolidating Statements of Operations for the Nine Months Ended September 30, 2018



	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands)
Revenues	$	—		$	148,512		$	42,252		$	(21,104	)	$	169,660
Costs and expenses:
Operating	—			92,317			43,325			(21,137		)	114,505
Administrative and general	14,087			18,182			3,445			—			35,714
Depreciation	—			29,283			728			—			30,011
Total costs and expenses	14,087			139,782			47,498			(21,137		)	180,230
Gains on asset dispositions, net	—			2,269			—			—			2,269
Litigation settlement proceeds	42,000			—			—			—			42,000
Operating income (loss)	27,913			10,999			(5,246		)	33			33,699
Other income (expense):
Interest income	180			878			166			—			1,224
Interest expense	(10,925		)	(595		)	(126		)	—			(11,646		)
Foreign currency losses, net	(66		)	(141		)	(888		)	—			(1,095		)
Gain on debt extinguishment	—			—			175			—			175
Other, net	—			31			(10		)	—			21
Total other income (expense)	(10,811		)	173			(683		)	—			(11,321		)
Income (loss) before income taxes and equity earnings	17,102			11,172			(5,929		)	33			22,378
Income tax benefit	1,075			3,474			—			—			4,549
Income (loss) before equity earnings	16,027			7,698			(5,929		)	33			17,829
Equity in earnings (losses) of subsidiaries	3,655			1,577			—			(3,655		)	1,577
Net income (loss)	19,682			9,275			(5,929		)	(3,622		)	19,406
Net loss attributable to noncontrolling interest in subsidiary	—			—			310			—			310
Net income (loss) attributable to Era Group Inc.	$	19,682		$	9,275		$	(5,619	)	$	(3,622	)	$	19,716

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Three Months Ended September 30, 2019



	Parent			Guarantors		Non-guarantors			Eliminations			Consolidated
	(in thousands)
Net income (loss)	$	(1,908	)	$	4,389	$	(2,999	)	$	(1,541	)	$	(2,059	)
Comprehensive income (loss)	(1,908		)	4,389		(2,999		)	(1,541		)	(2,059		)
Comprehensive loss attributable to noncontrolling interest in subsidiary	—			—		149			—			149
Comprehensive income (loss) attributable to Era Group Inc.	$	(1,908	)	$	4,389	$	(2,850	)	$	(1,541	)	$	(1,910	)

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Three Months Ended September 30, 2018



	Parent		Guarantors			Non-guarantors			Eliminations		Consolidated
	(in thousands)
Net income (loss)	$	31,255	$	(897	)	$	(1,859	)	$	2,780	$	31,279
Comprehensive income (loss)	31,255		(897		)	(1,859		)	2,780		31,279
Comprehensive loss attributable to noncontrolling interest in subsidiary	—		—			10			—		10
Comprehensive income (loss) attributable to Era Group Inc.	$	31,255	$	(897	)	$	(1,849	)	$	2,780	$	31,289

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Nine Months Ended September 30, 2019



	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands)
Net income (loss)	$	(2,901	)	$	17,210		$	(7,293	)	$	(10,286	)	$	(3,270	)
Other comprehensive loss:
Foreign currency translation adjustments	—			(110		)	—			—			(110		)
Total other comprehensive loss	—			(110		)	—			—			(110		)
Comprehensive income (loss)	(2,901		)	17,100			(7,293		)	(10,286		)	(3,380		)
Comprehensive loss attributable to noncontrolling interest in subsidiary	—			—			357			—			357
Comprehensive income (loss) attributable to Era Group Inc.	$	(2,901	)	$	17,100		$	(6,936	)	$	(10,286	)	$	(3,023	)

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Nine Months Ended September 30, 2018



	Parent		Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands)
Net income (loss)	$	19,682	$	9,275		$	(5,929	)	$	(3,622	)	$	19,406
Other comprehensive loss:
Foreign currency translation adjustments	—		(5		)	—			—			(5		)
Total other comprehensive loss	—		(5		)	—			—			(5		)
Comprehensive income (loss)	19,682		9,270			(5,929		)	(3,622		)	19,401
Comprehensive loss attributable to noncontrolling interest in subsidiary	—		—			310			—			310
Comprehensive income (loss) attributable to Era Group Inc.	$	19,682	$	9,270		$	(5,619	)	$	(3,622	)	$	19,711

Supplemental Condensed Consolidating Statements of Cash Flows for the Nine Months Ended September 30, 2019



	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands)
Net cash provided by (used in) operating activities	$	66,231		$	(46,413	)	$	27		$	—		$	19,845
Cash flows from investing activities:
Purchases of property and equipment	—			(5,056		)	(112		)	—			(5,168		)
Proceeds from disposition of property and equipment	—			9,252			—			—			9,252
Purchase of investments	(5,000		)	—			—			—			(5,000		)
Proceeds from sale of investments	4,430			—			—			—			4,430
Proceeds from sale of equity investees	—			34,712			—			—			34,712
Principal payments on notes due from equity investees	—			2,334			—			—			2,334
Principal payments on third party notes receivable	—			5,340			—			—			5,340
Net cash provided by (used in) investing activities	(570		)	46,582			(112		)	—			45,900
Cash flows from financing activities:
Payments on long-term debt	—			(1,246		)	(212		)	—			(1,458		)
Extinguishment of long-term debt	(740		)	—			—			—			(740		)
Proceeds from share award plans	—			—			—			1,077			1,077
Purchase of treasury shares	(7,676		)	—			—			—			(7,676		)
Borrowings and repayments of intercompany debt	—			1,077			—			(1,077		)	—
Net cash used in financing activities	(8,416		)	(169		)	(212		)	—			(8,797		)
Effects of exchange rate changes on cash and cash equivalents	—			—			35			—			35
Net increase (decrease) in cash and cash equivalents	57,245			—			(262		)	—			56,983
Cash, cash equivalents and restricted cash, beginning of period	48,396			—			2,357			—			50,753
Cash, cash equivalents and restricted cash, end of period	$	105,641		$	—		$	2,095		$	—		$	107,736

Supplemental Condensed Consolidating Statements of Cash Flows for the Nine Months Ended September 30, 2018



	Parent		Guarantors			Non-guarantors			Eliminations			Consolidated
	(in thousands)
Net cash provided by operating activities	$	35,550	$	13,319		$	1,483		$	—		$	50,352
Cash flows from investing activities:
Purchases of property and equipment	—		(7,461		)	(225		)	—			(7,686		)
Proceeds from disposition of property and equipment	—		29,520			—			—			29,520
Dividends received from equity investees	—		1,000			—			—			1,000
Principal payments on notes due from equity investees	—		401			—			—			401
Principal payments on third party notes receivable	—		620			—			—			620
Net cash provided by (used in) investing activities	—		24,080			(225		)	—			23,855
Cash flows from financing activities:
Long-term debt issuance costs	—		—			—			(1,295		)	(1,295		)
Payments on long-term debt	—		(1,247		)	(2,315		)	(39,000		)	(42,562		)
Proceeds from share award plans	—		—			—			893			893
Borrowings and repayments of intercompany debt	—		(39,402		)	—			39,402			—
Net cash used in financing activities	—		(40,649		)	(2,315		)	—			(42,964		)
Effects of exchange rate changes on cash and cash equivalents	—		—			(445		)	—			(445		)
Net increase (decrease) in cash and cash equivalents	35,550		(3,250		)	(1,502		)	—			30,798
Cash, cash equivalents and restricted cash, beginning of period	10,800		3,250			2,783			—			16,833
Cash, cash equivalents and restricted cash, end of period	$	46,350	$	—		$	1,281		$	—		$	47,631