Offshore Logistics, Inc.
224 Rue De Jean – 70508
Post Office Box 5C
Lafayette, Louisiana 70505
Tel: (337) 233-1221
Fax: (337) 235-6678
PRESS RELEASE
OFFSHORE LOGISTICS, INC.
ANNOUNCES HIGHER REVENUE, OPERATING INCOME AND NET INCOME
FOR THE SECOND FISCAL QUARTER
ENDED SEPTEMBER 30, 2004
LAFAYETTE, LOUISIANA (November 3, 2004) – Offshore Logistics, Inc. (NYSE: OLG) today reported net income for the second quarter ended September 30, 2004 of $18.0 million, or $0.77 per diluted share, on revenues of $162.3 million, compared to net income of $8.5 million, or $0.37 per diluted share, on revenues of $140.8 million for the second quarter ended September 30, 2003. Net income in the prior year second quarter was affected by debt restructuring costs of $6.2 million (before tax) or $0.19 per diluted share relating to the Company’s issuance of $230 million 6 1/8% Senior Notes and the related redemption of previously issued debt.
Net income for the six months ended September 30, 2004 was $31.0 million, or $1.34 per diluted share, on revenues of $312.3 million, compared to net income of $16.8 million, or $0.74 per diluted share on revenues of $275.6 million for the six months ended September 30, 2003.
Bill Chiles, Chief Executive Officer and President of Offshore Logistics, Inc. said, “I am pleased to report another quarter of solid operating performance for all of our major business units. Bristow’s previously announced cost reduction measures in the North Sea are beginning to take effect as evidenced by the operating margin improvement in that market, despite a 6% reduction in flight activity from the similar quarter in the prior year. North Sea results also benefited from the impact of rate adjustments with certain customers. North American operations experienced slightly lower flight activity from the similar quarter in the prior year, which exerted a downward pressure on margins.”
“Conversely, activity in our International Business Unit is up 7% and the operating margin has improved from the prior year second quarter and sequentially from the June 2004 quarter. Increased activity in Australia, Nigeria, and Trinidad, and the acquisition of a new operation in Russia were the main contributors to this improvement.”
“The positive results delivered this quarter were produced without a dramatic improvement in drilling activity in either of our two largest markets. Given the current level of commodity prices and other industry fundamentals, we are optimistic that our customers’ exploration and development activity will increase in the near term resulting in increased opportunities for the Company.”
At September 30, 2004, the Company’s consolidated balance sheet reflected $486.7 million in shareholders’ investment, $134.3 million in cash and $263.6 million of indebtedness.
Management will conduct a telephonic conference to discuss its second quarter results with analysts, investors and other interested parties at 10:00 a.m. Central Time on Thursday, November 4, 2004. Individuals wishing to access the conference call should dial (877) 822-9020 for domestic callers and (706) 679-7181 for international callers, approximately five to ten minutes prior to the start time. Please reference the Offshore Logistics, Inc. conference call hosted by Bill Chiles, Conference ID No. 1503648. A replay of the conference call will be available two hours after completion of the teleconference. To hear that recording, dial (800) 642-1687 for domestic callers and (706) 645-9291 for international callers, and enter Conference ID number 1503648. The replay will be available until 11:59 PM EST, Thursday, November 11, 2004.
Offshore Logistics, Inc. is a major provider of helicopter transportation services to the oil and gas industry worldwide. Through its subsidiaries, affiliates and joint ventures, the Company provides transportation services in most oil and gas producing regions including the United States Gulf of Mexico and Alaska, the North Sea, Africa, Mexico, South America, Australia, Egypt and the Far East. The Company’s Common Stock is traded on the New York Stock Exchange under the symbol OLG.
The tabulated results for the periods ended September 30, 2004 and 2003, are as follows (amounts in thousands, except earnings per share):
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
2004 | 2003 | 2004 | 2003 | |||||||||||||||||
Revenue | $ 162,282 | $ 140,803 | $ 312,262 | $275,553 | ||||||||||||||||
Net Income | $ 18,036 | $ 8,500 | $ 31,006 | $16,768 | ||||||||||||||||
BASIC: | ||||||||||||||||||||
Earnings per common share | $ 0.79 | $ 0.38 | $ 1.36 | $0.74 | ||||||||||||||||
Weighted average number of | ||||||||||||||||||||
common shares outstanding | 22,933 | 22,515 | 22,794 | 22,513 | ||||||||||||||||
DILUTED: | ||||||||||||||||||||
Earnings per common share | $ 0.77 | $ 0.37 | $ 1.34 | $0.74 | ||||||||||||||||
Weighted average number of | ||||||||||||||||||||
common shares outstanding and | ||||||||||||||||||||
assumed conversions | 23,325 | 22,673 | 23,126 | 25,244 | ||||||||||||||||
Selected operating data:
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
2004 | 2003 | 2004 | 2003 | |||||||||||||||||
(in thousands, except flight hours) | ||||||||||||||||||||
Flight hours (excluding unconsolidated affiliates): | ||||||||||||||||||||
Helicopter activities: | ||||||||||||||||||||
North American Operations | 32,606 | 34,147 | 64,424 | 65,025 | ||||||||||||||||
North Sea Operations | 11,071 | 11,742 | 21,314 | 23,143 | ||||||||||||||||
International Operations | 23,866 | 22,311 | 46,815 | 43,218 | ||||||||||||||||
Technical Services | 614 | 544 | 1,128 | 757 | ||||||||||||||||
Total | 68,157 | 68,744 | 133,681 | 132,143 | ||||||||||||||||
Operating revenue: | ||||||||||||||||||||
Helicopter activities: | ||||||||||||||||||||
North American Operations | $ | 42,973 | $ | 42,684 | $ | 84,804 | $ | 80,509 | ||||||||||||
North Sea Operations | 52,249 | 43,768 | 97,571 | 88,751 | ||||||||||||||||
International Operations | 53,323 | 41,863 | 102,179 | 83,597 | ||||||||||||||||
Technical Services | 8,604 | 9,267 | 18,232 | 16,080 | ||||||||||||||||
Less: Intercompany | (10,015 | ) | (8,858 | ) | (21,330 | ) | (16,493 | ) | ||||||||||||
Total | 147,134 | 128,724 | 281,456 | 252,444 | ||||||||||||||||
Production Management Services | 14,630 | 12,018 | 28,321 | 23,691 | ||||||||||||||||
Corporate | 1,335 | 3,068 | 5,118 | 5,951 | ||||||||||||||||
Less: Intercompany | (4,375 | ) | (4,381 | ) | (8,789 | ) | (8,764 | ) | ||||||||||||
Consolidated total | $ | 158,724 | $ | 139,429 | $ | 306,106 | $ | 273,322 | ||||||||||||
Operating income: | ||||||||||||||||||||
Helicopter activities: | ||||||||||||||||||||
North American Operations | $ | 7,083 | $ | 9,754 | $ | 14,704 | $ | 13,559 | ||||||||||||
North Sea Operations | 10,018 | 3,319 | 16,378 | 8,698 | ||||||||||||||||
International Operations | 8,072 | 5,351 | 15,273 | 11,751 | ||||||||||||||||
Technical Services | 26 | 128 | (2,748 | ) | 272 | |||||||||||||||
Total | 25,199 | 18,552 | 43,607 | 34,280 | ||||||||||||||||
Production Management Services | 1,002 | 780 | 1,766 | 1,403 | ||||||||||||||||
Corporate | (3,416 | ) | (685 | ) | (4,645 | ) | (1,420 | ) | ||||||||||||
Gain on disposal of assets | 3,558 | 1,374 | 6,156 | 2,231 | ||||||||||||||||
Consolidated total | $ | 26,343 | $ | 20,021 | $ | 46,884 | $ | 36,494 | ||||||||||||
Operating margin: | ||||||||||||||||||||
Helicopter activities: | ||||||||||||||||||||
North American Operations | 16.5 | % | 22.9 | % | 17.3 | % | 16.8 | % | ||||||||||||
North Sea Operations | 19.2 | % | 7.6 | % | 16.8 | % | 9.8 | % | ||||||||||||
International Operations | 15.1 | % | 12.8 | % | 14.9 | % | 14.1 | % | ||||||||||||
Technical Services | 0.3 | % | 1.4 | % | (15.1 | )% | 1.7 | % | ||||||||||||
Total | 17.1 | % | 14.4 | % | 15.5 | % | 13.6 | % | ||||||||||||
Production Management Services | 6.8 | % | 6.5 | % | 6.2 | % | 5.9 | % | ||||||||||||
Consolidated total | 16.6 | % | 14.4 | % | 15.3 | % | 13.4 | % |
Statements contained in this press release that state the Company’s or management’s intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements. It is important to note that the Company’s actual results could differ materially from those projected in such forward-looking statements. Factors that could cause actual results to differ materially from those in the forward-looking statements contained in this press release include the possibility that the benefit from rate increases and cost savings in the North Sea Operations is not long lived, that the increased activity from Australia, Nigeria, Trinidad and Russia does not continue and even if it does, that it does not result in margin improvement and, that in spite of the current commodity prices, our customers’ exploration and development activity does not increase in the near term. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company’s SEC filings, including but not limited to the Company’s report on Form 10-K for the year ended March 31, 2004 and the Company’s report on Form 10-Q for the quarter ended June 30, 2004.
Investor Relations
Contact: H. Eddy Dupuis
Phone: (337) 233-1221
Fax: (337) 235-6678
investorrelations@olog.com
OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES
Consolidated Statements of Income
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
2004 | 2003 | 2004 | 2003 | |||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||||||
Gross revenue: | ||||||||||||||||||||
Operating revenue | $ | 158,724 | $ | 139,429 | $ | 306,106 | $ | 273,322 | ||||||||||||
Gain on disposal of assets | 3,558 | 1,374 | 6,156 | 2,231 | ||||||||||||||||
162,282 | 140,803 | 312,262 | 275,553 | |||||||||||||||||
Operating expenses: | ||||||||||||||||||||
Direct cost | 114,671 | 102,847 | 222,339 | 202,673 | ||||||||||||||||
Depreciation and amortization | 10,580 | 9,195 | 21,030 | 19,299 | ||||||||||||||||
General and administrative | 10,688 | 8,740 | 22,009 | 17,087 | ||||||||||||||||
135,939 | 120,782 | 265,378 | 239,059 | |||||||||||||||||
Operating income | 26,343 | 20,021 | 46,884 | 36,494 | ||||||||||||||||
Earnings from unconsolidated affiliates, net | 2,401 | 3,047 | 3,921 | 4,950 | ||||||||||||||||
Interest income | 747 | 644 | 1,183 | 1,048 | ||||||||||||||||
Interest expense | 3,985 | 4,990 | 7,914 | 8,955 | ||||||||||||||||
Loss on extinguishment of debt | -- | (6,205 | ) | -- | (6,205 | ) | ||||||||||||||
Other income (expense), net | 473 | 380 | 561 | (1,894 | ) | |||||||||||||||
Income before provision for income taxes and | ||||||||||||||||||||
minority interest | 25,979 | 12,897 | 44,635 | 25,438 | ||||||||||||||||
Provision for income taxes | 7,794 | 3,868 | 13,391 | 7,631 | ||||||||||||||||
Minority interest | (149 | ) | (529 | ) | (238 | ) | (1,039 | ) | ||||||||||||
Net income | $ | 18,036 | $ | 8,500 | $ | 31,006 | $ | 16,768 | ||||||||||||
Net income per common share: | ||||||||||||||||||||
Basic | $ | 0.79 | $ | 0.38 | $ | 1.36 | $ | 0.74 | ||||||||||||
Diluted | $ | 0.77 | $ | 0.37 | $ | 1.34 | $ | 0.74 | ||||||||||||
OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
September 30, 2004 | March 31, 2004 | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
(in thousands) | |||||||||||
ASSETS | |||||||||||
Current Assets: | |||||||||||
Cash and cash equivalents | $ | 134,257 | $ | 85,679 | |||||||
Accounts receivable | 130,642 | 121,146 | |||||||||
Inventories | 138,560 | 133,073 | |||||||||
Prepaid expenses and other | 14,479 | 10,874 | |||||||||
Total current assets | 417,938 | 350,772 | |||||||||
Investments in unconsolidated affiliates | 29,154 | 38,929 | |||||||||
Property and equipment - at cost: | |||||||||||
Land and buildings | 27,746 | 26,594 | |||||||||
Aircraft and equipment | 792,917 | 797,783 | |||||||||
820,663 | 824,377 | ||||||||||
Less: Accumulated depreciation and amortization | (242,075 | ) | (238,721 | ) | |||||||
578,588 | 585,656 | ||||||||||
Goodwill | 26,824 | 26,829 | |||||||||
Other assets | 41,031 | 42,717 | |||||||||
$ | 1,093,535 | $ | 1,044,903 | ||||||||
LIABILITIES AND STOCKHOLDERS’ INVESTMENT | ||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Current Liabilities: | ||||||||||||||||||||
Accounts payable | $ | 34,251 | $ | 27,439 | ||||||||||||||||
Accrued liabilities | 64,985 | 65,257 | ||||||||||||||||||
Deferred taxes | 660 | 1,802 | ||||||||||||||||||
Current maturities of long-term debt | 5,426 | 4,417 | ||||||||||||||||||
Total current liabilities | 105,322 | 98,915 | ||||||||||||||||||
Long-term debt, less current maturities | 258,216 | 251,117 | ||||||||||||||||||
Other liabilities and deferred credits | 145,625 | 147,326 | ||||||||||||||||||
Deferred taxes | 93,132 | 92,042 | ||||||||||||||||||
Minority interest | 4,525 | 9,385 | ||||||||||||||||||
Stockholders' Investment: | ||||||||||||||||||||
Common Stock, $.01 par value, authorized 35,000,000 | ||||||||||||||||||||
shares; outstanding 23,231,910 and 22,631,221 at | ||||||||||||||||||||
September 30 and March 31, respectively (exclusive of | ||||||||||||||||||||
1,281,050 treasury shares) | 232 | 226 | ||||||||||||||||||
Additional paid-in capital | 154,978 | 141,384 | ||||||||||||||||||
Retained earnings | 383,608 | 352,602 | ||||||||||||||||||
Accumulated other comprehensive loss | (52,103 | ) | (48,094 | ) | ||||||||||||||||
486,715 | 446,118 | |||||||||||||||||||
$ | 1,093,535 | $ | 1,044,903 | |||||||||||||||||