Mark Huber is an aviation industry veteran who has worked in the flight training, aircraft sales, aircraft component, and airport development businesses. He has flight time in more than 50 different and diverse aircraft, including helicopters, aerobatic aircraft, vintage warbirds, jet fighters, business jets and turboprops, and transport-category aircraft. He has jumped out of several of these—on purpose—with a parachute. His defense and aviation journalism has been published in a variety of national and international periodicals.

Contributor

Mark Huber

The world's largest operator of commercial helicopters is getting smaller. Helicopter services company Bristow Group announced a major corporate restructuring in early June that will divide the company into two regional hubs, slash administrative overhead and shrink its Houston headquarters staff. The move comes less than two weeks after the company posted another large quarterly loss amid declining revenues across the board—not just in its offshore energy sector—and the share price of its stock collapsed from $14.62 on May 23 to $6.55 on May 31.

 


Bristow CEO Jonathan Baliff said the company is “shrinking to fit” the current market and the latest moves are part of a broad strategy that includes cost efficiencies, portfolio and fleet optimization encompassing OEM cost recoveries and capital expenditure reductions, and revenue. The economy measures come atop $200 million in cost savings already in play.

 


Bristow acknowledges a need to move quickly to stay afloat. “Our financial results for the quarter and really for the year were unacceptable,” Baliff said. For the quarter ended March 31, it lost another $78 million, compared with a loss of $25.3 million from the year-ago period. Operating revenues were also down, plunging by more than $51 million from the year-ago quarter, down to $323.6 million from $375.26 million. Bristow attributed the results to a combination of factors including “the decrease of our oil-and-gas operations’ margins due to the continued offshore oil-and-gas industry downturn with certain contract work ending during the quarter being partially offset by the one-time benefit of $11.1 million from a contract termination payment. The March 2017 quarter and Fiscal Year 2017 results were also impacted by costs incurred resulting from the grounding of the Airbus H225 fleet, the impact of the depreciation of the British pound sterling and significant non-cash tax charges.”

 


While oil-and-gas weakness played a significant role in the decline, Bristow's diversification strategy also disappointed. Most notably, revenues from its UK search-and-rescue contract fell 29 percent from the year-ago quarter, dropping from $62.1 million to $43.9 million. Bristow also is cutting back its efforts to pursue U.S. government contracts. Baliff explained, “Diversification does cost money. We will not have the cost structure to pursue that as much.”&nbsp;While Bristow improved its liquidity from the quarter ended on December 31, 2016, given its current expense rate, it could be out of cash before the end of 2018 without a combination of additional borrowings, revenues and economies. If those latter three factors align, Bristow predicts, “We expect liquidity as of March 31, 2018 to still be in excess of $200 million.” However, Baliff warned, “This is going to be a long slog.”

 


Bristow's restructuring is centered around the creation of two regional hubs: Europe and the Americas. The Europe hub includes Africa, Asia, Australia, Norway, the UK, Turkmenistan and the Middle East (EAMEA). The company’s Americas hub includes Bristow Academy, U.S. Gulf of Mexico, Suriname, Guyana, Trinidad, Canada and Brazil.

 


Restructuring the company into these two hubs and a commercial-support division is expected to reduce general and administrative costs initially by 12 percent. Bristow has named Alan Corbett vice president of EAMEA. Corbett will be responsible for operations and commercial development in those areas, including Bristow's fixed-wing operations, Airnorth and Eastern Airways. Rob Phillips has been named vice president Americas, responsible for operations and business development efforts in the region. He will also have global oversight of operational infrastructure support activities. &nbsp;

 


Baliff said reorganizing the company into regional hubs was not only about cost-cutting, but also in response to customer demands for increased regional focus and efficiencies that have taken rise during the energy downturn, and that Bristow's old global structure could not always competitively deliver.&nbsp;“Regional efficiencies; our clients are demanding it,” Baliff said, adding that the new structure would enable Bristow to be more regionally and country-focused and respond faster to customer needs.

News and issues regarding all manner of civil and military rotorcraft and their powerplants, including helicopters, tilt rotors and unmanned air vehicles.

Bristow Morphing into Regional Provider 

Continued losses prompt restructuring.

2024 Corporate Aviation Leadership Summit

Charlotte Bailey

News and information on safety procedures and concerns.

News and issues relating to the aerospace industry that are related to the science, engineering and business of flight in space involving civil, industrial and military applications, and similar topics related to flight in the atmosphere of the Earth that are not covered more directly by other AINonline subject channels. In other words, both astronautical and aeronautical subjects, except for those aeronautical topics that are specifically covered elsewhere on this website.

Fire and disaster management agency to use aircraft in aerial reconnaissance role

Japan Orders Its First H160 for Emergency Response

Flights with two scaled technology demonstrators will inform potential future iterations 

Singaporean eVTOL Conducts Test Campaign In Germany 

Matt Thurber

New developments and products in avionics, specifically about aircraft electronics in the cockpit.

News and issues relating to business, corporate and private aviation, primarily regarding turbine-engine-powered airplanes and helicopters. Subjects include aircraft, engines, maintenance, operations, personnel, acquisitions, accidents, safety, security, and training.

Lightweight white-phosphor NVG have a 94-degree field of view

FAA Approves TSO for ASU Panoramic Night-vision Goggles

Hanneke Weitering

Proposed rule addresses pilot awareness of control limits

FAA Floats Special Conditions for Skyryse Fly-by-wire R66

Charles Alcock

News about bills, laws, regulations and other governmental decisions affecting aviation and aerospace. Topics include FAA re-authorizations, taxes on fuel and aviation activities, environmental legislation, ICAO decisions, governmental mediation of labor conflicts and World Trade Organization disputes and decisions.

European Helicopter Association and Vertical Aviation International extended their alliance 

Vertical Lift Groups Extend Trade Show Partnership

Essential news and analysis on the defense aerospace business. Your trusted source for new and ongoing programs and requirements in military aircraft (manned and unmanned), engines, avionics, weapons and associated systems, including ground-based air defense.

More In Rotorcraft

Japan Orders Its First H160 for Emergency Response

Fire and disaster management agency to use aircraft in aerial reconnaissance role

Singaporean eVTOL Conducts Test Campaign In Germany

Flights with two scaled technology demonstrators will inform potential future iterations

FAA Approves TSO for ASU Panoramic Night-vision Goggles

Lightweight white-phosphor NVG have a 94-degree field of view

FAA Floats Special Conditions for Skyryse Fly-by-wire R66

Proposed rule addresses pilot awareness of control limits

Vertical Lift Groups Extend Trade Show Partnership

European Helicopter Association and Vertical Aviation International extended their alliance

Sikorsky Is Upgrading the Black Hawk Helicopter for Evolving Military Needs

Armed forces will be able to outfit Black Hawks with new armament and equipment.

Sikorsky’s S-97 Raider Points to a New Level of Performance for Future Helicopters

Originally developed for the U.S. military, X2 technology is in search of a new customer.

Bell 505 Makes Asia-Pacific Debut with Aichi Police

Joins fleet of longtime operator of Bell 206s and 412s

AIN Products

SUBSCRIPTIONS

RESOURCES

ABOUT AIN