State of the Industry [Archive]

rotor-rooter

27th May 2016, 07:50

In the course of my work and researching a multitude of detail across the entire industry, it is becoming increasingly apparent that various and disparate sectors of the helicopter industry are entering an adjustment phase quite unlike anything that has ever been experienced before. There have been plenty of them in the past, and many of us have been caught in the cycle, either at a global or regional level and they are very painful and often humbling experiences.

My immediate focus was the large players in the Oil and Gas business, principally because of the scale of their business and revenues, the size of their fleets and workforce, but also their global reach. They are also a major driver in the Manufacturing, Leasing, MRO and technology development arenas as well, specifically as they completed a total fleet upgrade cycle during the past decade, which resulted in massive investment in very diverse large young fleets, that have now suddenly found themselves with precipitously declining demand. With the continued low price of oil, in my opinion, there is a genuine risk to all businesses in this sector, due to falling demand for helicopters, the massive debt carried by all the players, the size of their businesses and the real likelihood that any real recovery will lag the oil price so far, that potentially within the next two years the landscape may be quite unrecognizable.

Focussing on O&G, the current lack of Capital investment in the exploration and subsequent production phases, other than projects already funded and in most cases being delivered in 2016/17, predicts there is going to be a void in new business for some time. As the necessary Capital commitments will only be made once there is a sustainable recovery of the Oil and Gas price, this could be potentially end up being measured in years as opposed to months, depending on the duration of depressed pricing. There is no shortage of oil in current global production, despite what people have been predicting for years, and the current price and oversupply demonstrate this quite clearly. The global helicopter demand in the existing current O&G production business is very predictable, although perhaps more inclined toward further reduction driven by further efficiencies and cost savings. Therefore the number of operational helicopters could fall across the board, impacting every company out there. Contracts may change between operators, but essentially the fleet size and demand will remain constant, or slowly decline.

So what is going to happen? I don't know and these are only my opinions, so I am very interested in counter arguments and the opinion of others. If the decline continues, there will be a pretty constant number of helicopters in operation, with no new business opportunities, a large number of helicopters are going to end up parked and generate no revenue, no payments to banks or lessors, and no employment for their staff. Assuming that this will ultimately affect each operator equally (more or less), what is the market going to look like and what are these individual businesses going to look like?

There are a couple of lessons to be learned from the recent CHC Chapter 11 filing, although the root causes for this specific business were set back almost to the time of the acquisition. Some very important caveats became apparent, because the debt/lease load could not be sustained by a long term downturn in their Customers business. These business predictions and assumptions based upon a historic cyclical oil business, and a relatively reasonable assumption of market oil prices, immediately jeopardize the financial health of the business, should the bottom drop out of it, and prices start falling and maintaining low levels based on global economics. As we saw with CHC, shrinking demand left significant excess non-revenue generating capacity. More alarmingly, was the threat to their continued existence once the normally highly confidential terms of their leasing and banking covenants were revealed, the leases they were carrying left them with no option other than file for Chapter 11 protection and immediately terminate a large number of leases. Their current restructuring plan, sees a further removal of all leased helicopters in their fleet in the very near future.

This could potentially happen to most other operators out there, as the industry comes into focus and investors pull out of their stock positions driving the stock price down. This limits the ability to borrow, but a Chapter 11 filing by arguably the largest operator in the world at the time, will spook the lenders; who are going to become risk averse in the sector, affecting every type of affected business, the appetite for continued current and future investment and ready access to cash.

Are other operators going to end up forced into the same position as CHC, simply by the volume of expensive and parked non-revenue generating assets?

Will the overall reduction in demand be shared amongst all the operators in the O&G sector?

Will the declining value of collateralized assets owned by operators affect their continued access to credit for normal business operations?

Will matching expenses to revenue result in continued significant terminations of leased assets and employees?

Will there be a shared downsizing of all the major players in the same manner as CHC, to scale each business to the current and anticipated future demand?

Will helicopter lessors be able to sustain and survive not only the impact of CHC's actions, but potentially other operators in the same situation?

Will the resultant price reduction/valuation from large numbers of surplus helicopters effectively negate any equity in the asset?

Will the large number of aircraft in the secondary resale market curtail the new helicopter manufacturing sector and any new models in development and pre-production?

With the significant reduction of operating hours, what effect will this have on the entire MRO and support business, both OEM and independent?

Have OEM's applied limitations to manufacturing and inventory orders that will impact supportability in the short to medium term.

I don't want to focus on the EC225, but it is such a significant unknown at this time and is a the largest single variable in this market - there are other threads discussing this at length. What happens if it's marketability and market share fall significantly due to customer determination?

I am a very optimistic person, but also a realist. This is not intended to be alarmist or negative, but I am genuinely interested in the thoughts and opinions of others in the business. These are only opinions, and I have no belief that my opinions or assumptions are either correct or the only ones out there. I'm quite open to being shot down on any opinion I share.

I do know however, that a there are a significant number of intelligent and informed individuals on PPRuNe that have insight and very valid opinions on the current and future state of the business.

It is my intent to post various contemporary reviews and analysis on this thread regarding the various companies, and would encourage anyone else so inclined to please do the same.

There's a lot in play right now. I would much rather see a rapid oil price and business recovery and consequent return to normality.

rotor-rooter

27th May 2016, 07:52

This analysis of Bristow is 6 month old, but makes interesting reading due to the events that have taken place since it was published.

http://freemanweb.freeman.tulane.edu/burkenroad/pdf/BRS.pdf

rotor-rooter

27th May 2016, 07:55

This analysis of Era is 6 months old, and equally interesting reading due to events since the publication date.

http://freemanweb.freeman.tulane.edu/burkenroad/pdf/ERA.pdf

rotor-rooter

27th May 2016, 23:40

From today's Wall Street Journal, update on Bristow strategy.

Bristow Sees Drop in Energy-Related Work, Might Cancel Some Helicopter Orders - WSJ (http://www.wsj.com/articles/bristow-sees-drop-in-energy-related-work-might-cancel-some-helicopter-orders-1464287438)

rotor-rooter

28th May 2016, 12:01

At least some analysts looking for an upturn. I wonder if this pay cut extends to Management?

Bristow Group Inc Stock Is Rising Now | Franklin Independent (http://www.franklinindependent.com/bristow-group-inc-stock-is-rising-now/)

EESDL

28th May 2016, 15:14

CHC are in Chap 11 due to their incredibly poor leadership and decision making. The oil price certainly did not help but they would have entered bankruptcy regardless. They had majority of their leased assets sat idle because they failed to win or did not compete for contracts which did not give healthier returns.

Soave_Pilot

29th May 2016, 11:57

In Brazil, after the Petrobras corruption scandal following the oil price dip they ended up cancelling many contracts and opted for high speed boats to transport passengers to many oil rigs in effort to reduce costs, not all of them, of course. Some companies here had the same or worse financial crises as CHC, although I don't think any of them filed for bankruptcy, they were either acquainted bigger players or ceased to operate. Many helicopters "left" the country as there was no work for them here.

nowherespecial

30th May 2016, 08:16

I agree with a lot of what RR says.

My 10c worth:

The barriers to entry in the offshore industry are not so high that the market is closed. The lack of huge barriers, especially vs 10 years ago and the explosion in ac financing, means that markets get competition. Competition means is that returns are getting generally worse on all contracts. This is how the market is supposed to work.

Over time, these returns settle into an acceptable level or 'market price'. The market price is dictated by a number of factors including difficulty of execution, availability of assets, asset type, desperation for the work, client relationships etc. As aircraft are chosen as 'industry standard' - 139, 92, 225 etc, operators only pick these ac. They pay their pilots roughly the same, the bases are in the same place, they use the same subcontractors for ground handling, the same simulator systems etc. The contracts become a commodity as to all measureable metrics they are the same and with likely roughly the same profitability.

The offshore industry is now in that state where it is unlikely there is a significant difference in standards between the top operators. I would be surprised if at the operational level there are many contracts which are hugely profitable anymore but there are plenty that are acceptably profitable to the operators who fly them.

IMO - Keeping above the waterline in this industry in the future will be one for sensible management teams with diversified customer bases across industries, EMS, offshore, SAR, military, training, utility, maybe even VIP and tourist. If one thing comes from CHC Ch 11 it should be that an O&G only model is too susceptible to oil price fluctuations. It would be ok if during the good times everyone was making enormous sums of money but they aren't (because of the competition) so the industry finds itself unable to make huge $ in the good times and crucified in the bad times. Aviation has always been this way (FW is the same). The only hedge to this issue is diversifying the model, running lean all the time (incl the good times) and never closing out an opportunity to make money because 'it's not core business'...

I think Babcock MCS already grasped this quite well, BRS too to an extent. The issue is if there is enough diversifying available for CHC, PHI, ERA etc to jump on to it too. I suspect not. The survivors will get bigger and the smaller operations will sink. I think the next 3 years will redraw the offshore operators business models radically.

The effect this will have elsewhere in the service providers to the offshore industry will be profound. Here are my predictions:
1. A couple of leasing companies will go bankrupt following CHC's ac returns which will be followed by other operators doing likewise with excess capacity, albeit not necessarily via the Ch 11 mechanism.
2. Unionised salaries will drop by 15% (cheating here as I see that BRS already started this)
3. At least one of the following will cease to exist: CHC, BRS, PHI, ERA, Heli Union, NHV, Everett. Maybe 2.
4. (States and) Oil companies will divest their heli operations as they become a drain on resources and an unwanted distraction leaving most work in private hands.
5. More centralisation of offshore training and adoption of OGP wide standards for sim work and flying, removing large chunks of ambiguity within operating and training manuals.
6. Regionally powerful operators (Pawan Hans, Weststar, Heliconia et al) will form partnerships with surviving large operators to take advantage of their scale and resources to drive efficiency in their own business.

Head above parapet - any thoughts?
:confused:

ATPMBA

30th May 2016, 14:18

Situation seems to be like a perfect storm for the helicopter industry.
Fracking, low demand, high output by the Saudis, CHC carrying large amounts of debt after the sale to an investment firm, heli pilots out of work.

However, perhaps in a few years when demand increases/supply decreases there could be a mad scramble to ramp up for offshore drilling and support.

AnFI

30th May 2016, 20:17

Wise words from Llanelli, (Know Where? Special)

xept the barrier to entry which they've all tried to engineer doesn't work, so they're all 'screwed', they're in bed with the regulators (who don't understand what they are doing), and think it's cleaver to insist on the most expensive solution (as all incumbent contract holders do/always have).

So they've come up with helicopters designed by electrical engineers, that will capsize and drown you WHEN (not 'if') they have to land on the water (that they will have to do at about the same rate that singles do, xept not because of the engines, mostly the other issues, arising from insisting on engine redundancy), pricing boats into being a more viable solution. Not understanding 'anti-fragile', no diversity leads to catastrophic collapse by all, together, as the shared thresholds of survivability are all hit at the same time, (xept those that ditch their investors instead, well done CHC, cynical rebirth).

BIG twins, fun while it lasts :mad:

nowherespecial

31st May 2016, 15:16

II - happy for people to disagree with me but BRS's results last week were terrible and they lost 28% in a day, including 21% while the call was on. I'm not saying it will be them but the finance guys think as a stock it's a dog with fleas right now. It's a major cash flow issue.

PHI - I'll defer to greater knowledge. Wasn't seeking to tar all with same brush, more that kind of size organisation needs to go before equilibrium in the industry takes hold.

crunchingnumbers

5th Jun 2016, 14:23

Clearly there are major current issues in O&G and the leasing business with a lot of excess aircraft inventory.

Nowherespecial mentioned diversification and certainly that is desirable but it seems to me that there is excess capacity in many sectors - EMS in the US for one. One of the things I would like comment on is asset valuation which in many cases is leveraged (quite probably with covenants). At some point one would think that these valuations might be questioned, which will impact many facets of an organizations trading/operational capability. Planned fleet renewal and disposition, finance structures, existing obligations, debt ratios, depreciation expense charges or write downs would all come into play but a bit like leading up to the housing bubble, no one is looking at it or the potential impact in the supposedly healthy areas of the industry.

Acknowledging that there is a difference when considering O&G with medium/heavy twins and everything else using singles/light twins but I don't see how you separate the two in terms of appetite or concern where fleet value exceeds $800m in one case I'm looking at. I would enjoy reading comments from those more in tune with the aircraft market.

airpolice

5th Jun 2016, 19:27

As an outsider, with no industry knowledge, might I suggest that you look at the real world, out with the rotary wing environment?

A reduction, as we are seeing in E&P means that not only helicopter crews are seeing a surplus of capacity in relation to demand. All levels of staff on platforms are now subject to it being a buyers market. Longer periods offshore, boat transfers and the ability to drop anyone, no matter their skill set, all point to reduce op costs and no downside.

Of course it is important that the chance to cull is taken wisely and the right guys get chopped, but in the real world, well, some good guys will get binned for no good reason.

For everyone working offshore saying they will not do four on one off, there is someone back home asking what he will do instead of working offshore.

Take a look at the Nimrod cancellation. How many people, apparently in the know, were adamant that LRMPA could not be abandoned? The whole case for the Nimrod was built upon the unquestioned requirement for such a beast. Take away the airframe and it becomes very obvious that the unthinkable is the reality.

Not having the Nimrod is of no consequence, because the client (MOD) has decided that the RAF do not need to carry out the tasking.

When the oil companies decide to half the number of change overs, they will expect to do half the number of helicopter trips and therefore pay half the cost. They will of course face in an increase in fees for boats, but still save substantial money.

Half of your industry sector wiped out. The knock on into SAR, EMS, Law Enforcement, VIP and retention rates for military pilots should not be ignored.

As for the finance aspect... I don't see the money men supporting the next round of expansion of fleets because the Oil companies are back in the game.

rotor-rooter

22nd Jul 2016, 22:10

This analysis focuses and updates on a number of issues that have been reported on these pages recently concerning Bristow. There are some very serious issues that need to be addressed, and obviously the timing is becoming critical.

Bristow Group: Near Term Catalyst For 45% Drop - Bristow Group Inc. (NYSE:BRS) | Seeking Alpha (http://seekingalpha.com/article/3990570-bristow-group-near-term-catalyst-45-percent-drop)

crunchingnumbers

23rd Jul 2016, 15:58

Interesting article and analysis RR. A compelling reason for a short BRS at Friday's closing price 12.21 although there was high trade volume and maybe too late. Looks like it is breaking below the 50ma and poised for lower.

For all those at BRS including some friends, I wish the best.

nowherespecial

25th Jul 2016, 12:04

This SA article is as bad as the CHC one a few months ago with one crucial distinction: CHC was badly managed by people who believed their own hubris, BRS seems (emphasis on the appearance from the article) to be nakedly dishonest. If BRS end up in front of the same judge in Texas as CHC (entirely possible) looking for Ch 11 protection in the future, the Judge might not be so helpful.

The comments on UK SAR echo what I have heard before, including that BRS' deal captain left BRS shortly after the deal was concluded as mgmt were confused at how they'd ended up taking the contract at tiny if not negligible rates of return.

This is going to be a wild ride.

Apate

25th Jul 2016, 14:20

It's interesting that BRS management keep talking up the amount of revenue from UK SAR, but don't discuss margins.

The amount of global corporate tax evasion that takes place seems to be absolutely monumental. What a shame the tax authorities hammer workers and individuals, simply because they are easy to get at.

Hopefully BRS can weather the storm, but out of the big three in the UK they do seem to be facing the biggest headwind at the moment.

Tim Brooke Taylor

25th Jul 2016, 21:16

RR thanks for the link - the article is a bit strong and drawing conclusions that may be loosely based on fact. There is an obvious incentive for him to sling mud so that they can make money from the short. You don't have to be a rocket scientist to know that BRS share price is likely to fall further given that they have the largest idle fleet and some of the highest carrying costs.

A sale and lease back only helps liquidity and cash for the short term in this current environment. Having said that, BRS does have some very real issues to contend with and it won't be long before a smaller, more agile CHC comes out of Chapter 11.

There has been a lot of value wiped out of this industry and unfortunately more will have to follow before it gets better. It is going to get worse before it gets better. If I was providing advice to a training helicopter pilot at the moment, I would tell them to have a plan b just in case...

Diversification is going to be very important for many very quickly.

nowherespecial

1st Aug 2016, 13:36

Here's a question, with every other operator absolutely bleeding with idle assets all over the place and making crew redundant, why are Weststar taking delivery of up to 7 aircraft and hiring crew? Did I miss a major contract award (highly possible I admit) or are they going down the old CHC model of "growth absolutely irrespective of the market conditions"....? Seems very punchy in this climate.

Self loading bear

1st Aug 2016, 19:49

Weststar is flying For Kosmos Energy.
Kosmos is going relatively well with their explorations.
(Senegal/Marocco).
Rumour is that a exploration Drilling contract is about to be issued for Offshore Suriname. (Where Kosmos has 2 blocks)
I do not know if 1+1=2.
For 1 Rig this would Be limited to about 2 Helicopters.

Some Background on Weststar:
Weststar looks to expand horizons | New Straits Times | Malaysia General Business Sports and Lifestyle News (http://www.nst.com.my/news/2016/01/122424/weststar-looks-expand-horizons?m=1)

SLB

nowherespecial

5th Aug 2016, 10:13

SLB, thanks. My question was aimed more at is this expansion people required or are they replacing people on contract. Seems like it might be new work although not sure if Kosmos awarded Suriname yet.

No discussion here yet on BRS's appalling results? Loss of $41m in the quarter and revenue miss on analyst expectation:
Bristow Investors ? SEC Filings ? BRS ? bristowgroup.com (http://ir.bristowgroup.com/phoenix.zhtml?c=91226&p=irol-sec&secCat01.1_rs=11&secCat01.1_rc=10)

Having spent 18 months kicking CHC, shall we now spend some time kicking BRS as well?

Good job we didn't all bet on the Seeking Alpha article (I hope we all didn't) as the $8 stock never happened yesterday but earnings call with the BRS leadership team today. Dial in if you can, could be super interesting and if you do, keep the stock price ticker open next to you, or a spread betting site (live not delayed info).

I wonder how long it will take for the first analyst to ask about the huge declared margin for UK SAR for the full financial year - expectation for full year is $80-100m profit on $225m of revenue which seems like a lot. I expect the British Government might have something to say about that...! (It's almost $10k per ac per day).

lowfat

5th Aug 2016, 14:22

You couldn't make it up over a billion dollars in debt and still the fiddler Balif strums his violin.
If the Nigerian currency carries on falling how long till bristow pull the plug?

nowherespecial

5th Aug 2016, 14:34

This is a relentlessly positive call for $41m loss.

nowherespecial

5th Aug 2016, 14:40

I wonder how the SA chap is feeling with him being net short and BRS up nearly 6% already today....

212man

15th Aug 2016, 09:39

Not all doom and gloom, it would appear:
News - Full Story | TickerTech.com (http://www.tickertech.com/cgi/?a=news&ticker=a&w=&story=201608201608122016CANADANWWEB______C3773)

minigundiplomat

15th Aug 2016, 10:28

Thanks for posting some positive news 212.

With CHC expected to exit Chapter 11 in the coming months, it looks like the industry is undergoing a much needed rebalancing. Positive results from HNZ and other providers undergoing restructuring should deliver much needed change.

Some will continue to tread an old path though I fear.

Self loading bear

27th Sep 2016, 09:40

ERA has managed to renew the contract with BSEE:
24 Exclusive Aircraft
5 on call
Of course the article says nothing about if reduced rates are applied.

Era Group enters new five-year deal with BSEE | Offshore Energy Today (http://www.offshoreenergytoday.com/era-group-enters-new-five-year-deal-with-bsee/?utm_source=emark&utm_medium=email&utm_campaign=daily-update-offshore-energy-today-2016-09-27&uid=153877)

SLB

rotor-rooter

9th Nov 2016, 14:14

Unfortunately, Erickson has filed for Chapter 11 protection today.

Erickson Incorporated Files Chapter 11 Nasdaq:EAC (http://globenewswire.com/news-release/2016/11/09/888273/0/en/Erickson-Incorporated-Files-Chapter-11.html)

rotor-rooter

11th Nov 2016, 00:42

Both Erickson and CHC filed for Bankruptcy protection in the same Court, with the same Judge supervising both actions. She will be quite an expert on the Helicopter business by the time this process is completed - perhaps more so, than the individuals that led them into this situation.

nowherespecial

11th Nov 2016, 08:24

Maybe BRS will hire her for theirs!

212man

11th Nov 2016, 10:57

PHI Just filed their Q3 10-Q: http://www.phihelico.com/docs/Investor%20Relations/2016/2016%203rd%2010Q.pdf

nowherespecial

11th Nov 2016, 12:09

I wonder how Tullow will feel about giving PHI the work in Ghana but not being mentioned in any of the last 3 PHI 1/4 reports.... Nor mentioned on their website...

212man

11th Nov 2016, 12:31

I wonder how Tullow will feel about giving PHI the work in Ghana but not being mentioned in any of the last 3 PHI 1/4 reports.... Nor mentioned on their website...
Less than 15 years of service, and outside the GoM, obviously doesn't count....

Self loading bear

12th Nov 2016, 08:46

Mos is right,
If you look at the Rigfleet utilisation overviews of some Drilling companies you see "undisclosed customer" and "undisclosed rate" quite often.

The "undisclosed rate" appears more often lately which is (to me) an indication these rates are probably much lower as market average.

SLB

havick

13th Nov 2016, 04:22

Most oil and gas companies don't worry about publicity. Some even have contract conditions which don't allow a helicopter operator to make media announcements about their mutual business.

But I did hear a rumor the other day about PHI together with HNZ moving some aircraft into Australia for a contract.

I heard the same rumor of a SAR machine for Inpex. Have no idea how much truth to the rumor.

nowherespecial

15th Nov 2016, 10:41

Tullow aren't one of them. They wanted the world to know that TEN was online.

I see BRS are finding ways to generate the cash they are burning quickly:
Bristow Investors ? News Release ? BRS ? bristowgroup.com (http://ir.bristowgroup.com/phoenix.zhtml?c=91226&p=irol-newsArticle&ID=2222004)

They did announce they were looking at it, but this is a slippery slope as we've all seen.

The Inpex work HNZ and PHI are looking at it ex BRS work right? Interesting...

nowherespecial

17th Nov 2016, 08:05

TM - according to the recent S92 thread, now BRS have lost some work in Oz to the PHI / HNZ consortium. Just a SAR ac perhaps as Havick says?
http://www.pprune.org/rotorheads/587020-s-92-parts-go-flying.html

twisted wrench

17th Nov 2016, 13:52

HNZ are planning to move 4 S92´s for the contract they have or expect to win!!!

nowherespecial

17th Nov 2016, 14:18

Interesting.
So BRS Australia lose a flagship contract.
After losing loads of money.
And financing a load of ac.
But management say everything is fine (they paid a dividend again!)...

It's all a bit "CHC Lite" isn't it?

nowherespecial

17th Nov 2016, 14:40

Thanks II.

dieseldo

20th Nov 2016, 18:30

Quiet at Humberside these days.
From 5 operators to 2 (excluding SAR) in less than a year.

helimutt

21st Nov 2016, 11:19

2 excluding SAR? I was led to believe that Bristow had now gone and the only one left is CHC doing ad-hoc work? Or was that including the EC135 for wind farm work? Even the police helicopter has moved base. Very quiet times at Humberside. sad state of affairs for the industry. :(

nowherespecial

7th Feb 2017, 07:59

BRS losing yet more money.
Bristow Secures New Financing as Helo Ops Losses Widen | Business Aviation News: Aviation International News (http://www.ainonline.com/aviation-news/business-aviation/2017-02-06/bristow-secures-new-financing-helo-ops-losses-widen)
Not so sure my coment about it being CHC 'Lite' any more is accurate. It's a bit full on CHC 2014/15.

With CHC about to exit Ch 11, is it time BRS were kicked and everyone started taking their contracts.

SimonK

7th Feb 2017, 17:56

nowherespecial

8th Feb 2017, 08:07

I will Simon, thank you.

bigglesbutler

8th Feb 2017, 09:55

Thanks, my wife and kids will be delighted when I get made redundant because it's time BRS were kicked!!

Si B

driftwood1

8th Feb 2017, 11:20

Thanks, my wife and kids will be delighted when I get made redundant because it's time BRS were kicked!!

Si B

Funny!! I remember Being told to harden up and to bad so sad when I mentioned redundancy when CHC went into chapter 11.
Now you guys expect pity!!!! hilarious ........

nowherespecial

8th Feb 2017, 12:00

My point exactly Driftwood. Thank you Sir.

Brother

3rd Mar 2017, 13:18

Well I have completed S-92 sim training in Brunei and soon I will be heading to Broome to fly on the Inpex contract for PHI HNZ. 2 aircraft starting early April with 2 more later in the month. Still waiting for news on the Inpex sar contract.

industry insider

25th Mar 2017, 00:09

I hear that Babcock has won the Conoco Dili contract with H175s starting early 2018.

nowherespecial

25th Mar 2017, 07:05

I wonder if that might be impacted by the colossal f*ck up going on in Babcock Italy and Spain.... That will be a big reputation hit for Babcock who have always struck me as a very tightly controlled and well run company.

Ed Winchester

25th Mar 2017, 10:14

There is no such thing as 'Babcock Italy and Spain'. You presumably are referring to Babcock Italia.
Don't see why it would. CHC Scotia didn't lose all of their contracts just because several dozen of its sister/parent companies went into Ch 11 due to a colossal F*ck up.....did they?

minigundiplomat

26th Mar 2017, 11:28

From the numerous articles it would seem numerous Babcock entities are/have been involved in alleged collusion, corruption and anti-trust breaches.

Ed,

In response to your point - is Babcock MCS run centrally? or are each BU managed autonomously?

Ed Winchester

26th Mar 2017, 11:55

I don't know enough about the inner workings of Babcock MCS to answer your question to be honest, MGD. I am pretty sure they would all have their own commercial departments bidding for contracts - but I'm sure there is a monkey at the top of the tree who must take overall responsibilty.

Could you post a link to the numerous articles though? I can only find one.

If it turns out to be true, I dare say it will be a bit of an embarrassment to the higher echelons, given the tag line is 'Trusted to Deliver'.

Brother

13th Apr 2017, 08:00

The contract has started and I have done a few Inpex flights. I heard today that PHI HNZ has also won the inpex SAR contract in Broome shared with shell. 2 more S-92s coming then a full SAR one next year. Good for the company to keep winning work but bad for Bristow blokes. Maybe some will come over.

Ian Corrigible

18th Apr 2017, 13:36

Here's HeliValue$ (www.helivalues.com)' take on the current market:

In general, the single turbine market seems to be fairly active right now. Older Airbus AS350B2 and Bell 206L-3 values are improving. On the other hand, the newer Bell 206L-4’s and 407’s are softening. It’s possible that the newer machines are more than operators need at this time with tough competition for contracts and limited work in utility operations.

Light-twins continue to struggle to find a place out there. Values have dropped to record lows as have contracts for them. Mediums, for the most part, are still softening. The Leonardo AW-139, however, is having great success as the go-to helicopter for the offshore industry who has grown to love this model.

Heavies, heavies, heavies; the multi-million dollar topic! While the Airbus EC225LP crash is still under investigation HeliValue$’ has chosen not to publish resale values or provide valuations on this machine or the also affected Airbus AS332L2. Until there is a conclusion of that investigation, there is not a practical way to determine the current market or the anticipated future for these models.

The number of Sikorsky S-92A aircraft on the market is increasing mostly due to a dearth of contract renewals. Unfortunately, some of the contracts that are renewing are now requiring alternative aircraft such as super mediums. Both asking prices and market demand for used S-92A’s has been declining over the past two quarters. Leasing companies have managed to fill most of the contract demands with aircraft returned to them as part of the CHC restructuring process.

There are some bright spots, but the oil market probably has the biggest impact on the helicopter industry as a whole. We will continue to see instability in the market as the industry settles into the new reality of sustained low ppb oil becoming the norm, not just a momentary downturn.

I/C

Ian Corrigible

26th Apr 2017, 14:00

More O&G market insight from HeliValue$ (http://eepurl.com/cMkYDv), with a depressing conclusion for the S-92:

Renewed production of the S-92A will face stiff competition because some of the contract renewals are asking for mediums and super mediums rather than the S-92A for cost savings. As a consequence, we see some used S-92A’s being returned to the banks at the end of their contracts. With virtually no secondary market for this aircraft, there has been little interest in what is coming onto the market. The trend of decreased values will likely continue until oil prices recover to a level that is profitable in the North Sea or the values of the S-92A reach a level that competes with the Super Mediums.

Sikorsky delivered no S-92s or S-76Ds during the first quarter (http://www.investors.com/news/lockheed-martin-trims-earnings-guidance-after-missing-q1-sales-view) of 2017.

I/C

nowherespecial

26th Apr 2017, 16:45

As usual, the leasing companies are run from their spreadsheets. The hit in the real values of the ac would bury half of them. Let's be honest, their 225s and L2s are almost worthless these days. The economics of the SM class mean 90% of the capacity for 50% of the cost of an S92. They are a no brainer financially. Supply and demand will mean a whole heap of S92 coming idle in the next cycle of contract renewals. Those operators who can hand them back will do so. Those who own them will eat the balance sheet hit of idle assets.

squib66

26th Apr 2017, 18:28

I think it was generally thought BRS would win it.

Define generally!

The general public?
The oil and gas industry?
The helicopter operators?
INPEX staff?
INPEX procurement dept?
INPEX aviation dept?

Brother

12th May 2017, 13:20

Define generally!

Haha Squibby, answers below

The general public?-- they don't know about choppers
The oil and gas industry?-- In oz probably thought BRS would win
The helicopter operators? -- they all thought they would win themselves probably
INPEX staff? -- doesn't effect most
INPEX procurement dept? -- they did the evaluations so they had an idea
INPEX aviation dept + Shell aviation dept? -- they did the award to HNZ

HNZ have gone from nothing to most of the Broome work in 6 months.

nowherespecial

25th May 2017, 13:35

I note another set of horror show results for BRS.
Bristow Investors ? Overview ? BRS ? bristowgroup.com (http://ir.bristowgroup.com/phoenix.zhtml?c=91226&p=irol-irhome)
$14.62 yesterday, $9 today.

rotor-rooter

25th May 2017, 19:30

As the slide continues throughout the Offshore helicopter business, the serious cuts have been made, reorganizations complete (Chapter 11 is still an available for some) but the options for all the Operators are running out if the situation continues.

In the Bristow call yesterday, there is mention of litigation against Airbus regarding the 225 grounding. Assuming that this situation is similar for virtually all the Operators and Leasing groups, what is the potential financial impact on Airbus? They must have a huge exposure due to the losses incurred by Owners and Operators and the asset value being close to nothing? Will it be negotiated or blow up into a massive legal fight? Anyone have any insight?

Tango123

25th May 2017, 20:36

I do believe that everyone else is waiting for this legal act against Airbus:

https://www.verticalmag.com/news/airbus-helicopters-sued-three-companies-h225-situation/

If Airbus ends up losing this, then it will go worldwide, unless they decide to compensate appropriate.

T

SAR driver

27th May 2017, 08:26

I heard today that BRS Oz has lost the Quadrant (ex Apache) contract. AW139 and 2x BK117s?

True. Definitely 2 x BK117s but I don't know what they were using out of Karratha. This is after Bristow made 19 guys redundant the week before - it's a real pity that guys are still loosing their jobs.
No formal announcement on who has the contract yet

Mark Six

27th May 2017, 08:57

True. Definitely 2 x BK117s but I don't know what they were using out of Karratha. This is after Bristow made 19 guys redundant the week before - it's a real pity that guys are still loosing their jobs.
No formal announcement on who has the contract yet

Rumour has it that CHC has won the contract. More Bristow redundancies to come??

Too Cloudy

27th May 2017, 10:03

16 "potential" redundancies not 19....Well that was the wording in the email. Not redundant until the consultation process is complete. :-)

ersa

27th May 2017, 22:41

Oh no another possible contract lost by bristow ......When are they going to wake up and change there business model

Um... lifting...

28th May 2017, 01:29

One expects Chapter 11 will take care of that. http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=brs&x=28&y=14&time=8&startdate=1%2F4%2F1999&enddate=5%2F16%2F2017&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=4&maval=40&uf=8&lf=32&lf2=256&lf3=268435456&type=4&style=380&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=15

FloaterNorthWest

29th May 2017, 08:28

https://www.oilandgaspeople.com/news/14316/exclusive-chc-helicopters-threatens-to-sack-all-uk-pilots/

CHC Helicopters have threatened to sack all their 85 UK based pilots if each pilot does not agree to negotiations aimed at reducing their annual pay.

Oil and Gas People has learned that CHC Scotia Ltd is seeking to change the terms and conditions of all their UK-based pilots – preferably via negotiation, but if not, by imposition.

The proposed pay negotiations are set to take place between the 24th May and the 23rd June 2017 with CHC threatening to terminate the contracts of those unwilling to negotiate. If any pilots were to have their employment terminated, CHC intend to offer new contracts on revised and inferior terms.

It is unlikely CHC’s pilots will willingly accept pay reductions, as helicopter pilots require thousands of flight hours to fly commercially and are required to continually develop their skills. Pilot salaries are relative to the technical skill sets required and the decision for one operator to reduce salaries beyond the norm could result in an out-flux of experienced pilots.

A CHC spokesman, said: "We are not seeking to reduce the number of our pilot workforce. We have entered a period of collective consultation with the pilots' union BALPA regarding the standardisation of terms of conditions.

"The proposed changes are being put forward out of a desire to protect the jobs of all pilots and ensure a strong future for CHC."

CHC's parent company has only recently come out of Chapter 11 restructuring - aimed at preventing bankruptcy. This move allowed the organisation to wipe off over $1 billion of debt and in turn significantly reduce the size of their overall helicopter fleet.

The strong-arm move to reduce salaries is unheard of in the UK aviation sector and may signify that CHC’s Chapter 11 re-structuring has not achieved the long-term financial stability it was hoping for.

nowherespecial

29th May 2017, 10:50

Adapt to the new environment or die. CHC is just the first of the major operators to try this (if it's true). Many other operators have been operating without unionised crew for years.

In an environment where contracts are being lost, often by only a handful of thousands of $/EUR/ GBP a month, it is hardly surprising that any operator would not be looking for ways to reduce their crew costs which more often than not are the biggest expense when bidding a contract.

SASless

29th May 2017, 13:22

nowherespecial

29th May 2017, 13:54

Mitchaa, check out the BRS results. Investors are losing faith that BRS actually know what they are talking about. They did sale and leaseback on a good number of their aircraft to generate cash and they are merrily burning their way back through that too.

SAS, I guess we have to wait for the (no longer publicly available) results to answer that one. My money is on pay rises for all!

oleary

29th May 2017, 19:47

Mitchaa, check out the BRS results. Investors are losing faith that BRS actually know what they are talking about. They did sale and leaseback on a good number of their aircraft to generate cash and they are merrily burning their way back through that too.

Selling the furniture to pay the rent. Could work, .... I guess. :rolleyes:

rotor-rooter

9th Jun 2017, 04:04

Here comes the next round, all change at Bristow.

Bristow Investors ? RSS Content ? BRS ? bristowgroup.com (http://ir.bristowgroup.com/phoenix.zhtml?c=91226&p=RssLanding&cat=news&id=2279992)

Cyclic Hotline

9th Jun 2017, 16:43

Here's the latest plan.

http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9NjczNjEyfENoaWxkSUQ9MzgxNTcyf FR5cGU9MQ==&t=1

pitch horn

10th Jun 2017, 06:06

Target Zero ? ............... nearly there ��

SASless

10th Jun 2017, 18:11

Having had a bloated Management Structure for decades....they start cutting finally.

The down hill slide started with the first three or four changes of ownership and what we see today is the remains of the carcass that was picked over for years.

Maybe this time it will be down to bare bones before it is all over and the Beast can grow anew from there.

Hopefully....it will get back to being run as an Aviation company by people that know the Aviation business and not a bunch of Bean Counters and HR Empire Builders.

barbados sky

10th Jun 2017, 23:06

Hopefully....it will get back to being run as an Aviation company by people that know the Aviation business and not a bunch of Bean Counters and HR Empire Builders.

That is a very true statement for aviation companies. Accountants and HR people forget that you need the best people to maintain and fly aircraft and to manage those that do. Layers of VPs are superfluous.

donut king

11th Jun 2017, 05:09

That is a very true statement for aviation companies. Accountants and HR people forget that you need the best people to maintain and fly aircraft and to manage those that do. Layers of VPs are superfluous.

Unfortunately, the upside down triangle/ top heavy admin airline mgt model, has become engrained in major helicopter operators!

CHC restructured out of bankruptcy, but not out of that airline model. Bristow is still top heavy.

HNZ/CHL is on its way to that same model, sadly!

DK

TipCap

11th Jun 2017, 15:13

Hear Hear SASless

SASless

11th Jun 2017, 17:08

I saw the growth of the HR, Training, Safety, QA, and multi-levels of management at Bristow over the years.....and only in rare cases did that growth not be at the direct increase in overhead costs with no appreciable gain in productivitiy or margin.

Sometimes there is a need for adding some non-revenue Staff....but that has to be both proven and then very carefully measured and controlled.

CHC went down that Rabbit Hole very quickly.....too many folks with their finger in the pie contributing nothing but more cost and no revenue or cost savings.

Same at Bristow.

ericferret

11th Jun 2017, 19:42

No sooner did we form into teams than we were re-organised.
I was to learn later in life that we tend to meet every situation by re-organising and what a wonderful method it is for giving the illusion of progress whilst only producing confusion, inefficiency & demoralisation.

PETRONIUS AD 66

Plus ca change

Nigerian Expat Outlaw

11th Jun 2017, 21:51

Absolutely Sasless. I saw it happening first hand. Then the oil price crisis decimated the entire O & G industry and the superfluous people did exactly what ericferret quoted. However the re-organisation didn't include themselves; fingers were pointed downwards, not across or upwards.

Now the recession has continued to the point where the shareholders have started to lose confidence the Ess-Aitch-One-Tee has hit the proverbial air conditioning so they carry out a second reshuffle and two senior guys get the bullet. Too little too late methinks.......

NEO

ec155mech

12th Jun 2017, 01:43

SHELL is good at encouraging safety as long as it has no cost to them.. if however its costing them money we have to fly hell or high water..

I have so many stories from the UK and Nigeria that if CAA had known about it they would probably ban SHELL from ever chartering an aircraft again..

SAR driver

23rd Jun 2017, 05:32

Rumour has it that CHC has won the contract. More Bristow redundancies to come??

I heard that CHC have formally announced that they have won the Quadrant contract for Veranous Is (aircraft based in Karratha). Good for them

heli1

23rd Jun 2017, 06:21

Anyone know what replaced the MHS H225s flying with Petronas out of Kertih ?I read the contract now cancelled.

nowherespecial

23rd Jun 2017, 07:45

I think Weststar have it gapped with 139/189 at the moment.

rrekn

23rd Jun 2017, 13:24

It's official: CHC Helicopter Announces New Contract with Quadrant Energy (http://www.chcheli.com/node/102)

gnow

23rd Jun 2017, 13:50

I don't think anyone is going to fill in the gap. In fact Weststar also had their fleet reduced from 6 AW139 to 2 AW139 and 2 AW189. ExxonMobil experimented with crew change using boats and they are quite happy to continue using boats for all crew change. Chopper will only be for emergencies.

GoodGrief

23rd Jun 2017, 22:56

It's just not worth it anymore...:ugh:

"AeroConsulting is looking for a Flight Instructor Helicopter (FIH) to integrate an approved Training Organization (ATO) for pilot training on RH22, RH44 and AS350.
Part-time position to be filled immediately either as an employee or as a freelancer.(near Paris)
Annual salary ranging from € 12,000 to € 24,000 gross, weither € 1,000 and € 2,000 gross per month depending on the experience and the weekly duration set (to be defined with the candidate..."

Your missions:

Flight instruction on helicopter according to the approved training program;
Theoretical training according to the approved training program;
Possible aerial work missions;
Various administrative tasks (course preparations, monitoring and management of trainees, ...)

rotor-rooter

24th Jun 2017, 04:46

“With the oil and gas downturn we have extra equipment that we can put to use here,” Mr Baliff said. “We always knew oil wasn’t the be all and end all.”

https://www.ft.com/content/ffc43f0a-5711-11e7-9fed-c19e2700005f

Oil rig helicopters ditch roughnecks for the jet set

Chopper shuttle services tap high-end market after demand from offshore platforms falls

Bristow and Era, two of the largest providers of helicopter services to the oil industry, have struck deals with Blade, an app-based aviation group backed by big media investors, to use their helicopters on routes to upscale second home locales.

Blade, whose recent passengers have included Ryan Seacrest, the long-time host of American Idol, takes customers from Manhattan to weekend getaways such as the Hamptons and Nantucket. It also flies out of Los Angeles to beach communities such as Malibu.

The offshore oil and gas industry, which is a heavy user of helicopter services to carry people to and from rigs and platforms, has been particularly hard hit in the industry downturn since 2014. “Bristow is suffering along with our clients, such as Shell and BP,” said Jonathan Baliff, Bristow’s chief executive.

The company has sought to diversify, including providing rescue helicopters to the UK’s coast guard, but private aviation was an obvious area of growth.

“With the oil and gas downturn we have extra equipment that we can put to use here,” Mr Baliff said. “We always knew oil wasn’t the be all and end all.”

The move by the company and its rival Era into private aviation represents “the confluence” of the oil downturn with new crowdsourcing technologies which make helicopter travel more affordable, said Rob Wiesenthal, the founder and chief executive of Blade.

Companies have slashed their spending on offshore exploration and development of new projects, and there is much less activity now than before the slump in oil prices. At the end of 2013 there were 61 rigs working offshore in the US, according to Baker Hughes, the oilfield services group. Last week, there were just 22.

The decline internationally has been less dramatic, but still severe: there were 306 active offshore rigs outside the US at the end of 2013; last month there were 202.

Blade was founded by Mr Wiesenthal, a former Warner Music and Sony executive. The company is backed by some of media’s biggest names, including David Zaslav, chief executive of Discovery Communications; Eric Schmidt, chairman of Alphabet; Barry Diller, chairman of IAC; and Bob Pittman, chief executive of iHeartRadio.

SAR driver

24th Jun 2017, 04:47

A few AW189's are heading to Karratha for CHC to start contract Oct/Nov time. Not sure what contract mind you but is CHC's first AW189's.

I believe the AW189's are for the Woodside contract; they have been operating AW139's since the grounding of the EC225's

barbados sky

24th Jun 2017, 11:45

“With the oil and gas downturn we have extra equipment that we can put to use here,” Mr Baliff said. “We always knew oil wasn’t the be all and end all.”

Mr Baliff, just a hunch but I don't think you should be too reliant on the additional revenue from Blade to improve your share price.

rotor-rooter

18th Jul 2017, 19:15

Meanwhile, back in the real world.

https://marketexclusive.com/bristow-group-inc-nysebrs-files-an-8-k-entry-into-a-material-definitive-agreement/2017/07/

This is starting to look remarkably similar to another organization last year. Pledge all your assets and see what happens.

EESDL

27th Jul 2017, 00:46

Is only happening as the 'easy money' from O&G is now harder to make.
There was always a business case for such an enterprise and now more palatable using IT tech first derived by 'JumpJet' founder - coincidentally a chopper puke.
It will make bugger all difference to Bristow apart from making it easier for some of their heavy management to get to their beachfront homes.....

rotor-rooter

3rd Aug 2017, 21:20

More bad results (although no unexpected). Appears that the best plan is to try and wait it out and hope you don't run out of cash first? Bristow Group Reports First Quarter Fiscal Year 2018 Results (http://www.prnewswire.com/news-releases/bristow-group-reports-first-quarter-fiscal-year-2018-results-300499534.html)

EESDL

28th Aug 2017, 02:22

https://www.energyvoice.com/oilandgas/148552/oil-workers-killed-flying-gas-leak-thought-false-alarm/

kind of sums it all up really - safety alarm ringing for 4 days - suspect gas leak, deemed false, chopper lands on NUI and hey presto........
This problem with NUIs has been known for frigging decades and yet???
HSE (Government) - get a grip - we all know that the owners will not spend the money unless mandatory.

Krautwald

29th Aug 2017, 19:52

Hi all, being an older modular student pilot, I opted for FW training early in the process b/c I figured that a rather limited number of potential operators could be a show stopper for someone like me. Still interested in your side of the industry though. How are the RW people doing as of now, especially newcomers - it almost looks like nobody is getting hired for anything so nobody gets to collect the hours necessary for a real, well paid RW job, no? Sorry for putting it so bluntly, but is European RW dead or are people still entering the field? If so, how do they go about?

rotor-rooter

31st Aug 2017, 17:45

This is a rather bleak plan from GE now as well. GE is now the second largest Oilfield Services provider, following aggressive acquisition activities in a very depressed sector, making some pretty astute purchases. However, other parts of the business are depressed and the stock has fallen 23% this year - not a good sign for a business this large and diversified. Still not hit the bottom by the looks of it.

While the total number of cuts aren't known, they could come from human resources, recruiting, corporate security, helicopter and jet operations, procurement and the auditing divisions.

Report: GE Plans 'Aggressive' Layoffs At Its Corporate Office To Cut Costs | Stock News & Stock Market Analysis - IBD (http://www.investors.com/news/ges-new-ceo-reportedly-plans-aggressive-layoffs-to-cut-costs/)

212man

20th Oct 2017, 15:23

Oil's Biggest Rigs Headed to Junkyard as Daily Losses Mount

Oil's Biggest Rigs Headed to Junkyard as Daily Losses Mount | Rigzone (http://www.rigzone.com/news/oil_gas/a/152130/Oils_Biggest_Rigs_Headed_to_Junkyard_as_Daily_Losses_Mount?u tm_source=WeeklyNewsletter&utm_medium=email&utm_term=2017-10-20&utm_content=&utm_campaign=industry_headlines_1)

PS, why was it easier to find this thread using google than the actual search function?!!

Brother

15th Jan 2018, 08:17

anyone got an idea what the running is for the Woodside consortium tender for Karratha?

Mark Six

15th Jan 2018, 08:54

anyone got an idea what the running is for the Woodside consortium tender for Karratha?
CHC and Toll are definitely still in contention. CHC would have to be hot favourite with the current operation in place and the 189 successfully introduced into service.

belly tank

15th Jan 2018, 10:16

I believe some of the big players have pulled out due to the risk reward profile of the bid (low or negative profit margins, penalties and escape clauses)

You’d think out of the lowest bidders CHC being the incumbents in KTA would secure the slot over a heavy EMS focussed Toll apart from a couple of ex offshore guys and their HOTC, maybe thats why they advertised awhile ago for more offshore drivers to put into their bid :)

industry insider

15th Jan 2018, 11:56

I believe some of the big players have pulled out due to the risk reward profile of the bid.

I heard BRS has pulled out recently. Should be a clear run for CHC I would think.

NumptyAussie

15th Jan 2018, 11:58

I would imagine that HNZ/PHI would still be in contention, given what they have achieved to Bristow in Broome?

NumptyAussie

15th Jan 2018, 12:03

CHC and Toll are definitely still in contention. CHC would have to be hot favourite with the current operation in place and the 189 successfully introduced into service.

Are all the 189s in service?

belly tank

15th Jan 2018, 12:13

I would imagine that HNZ/PHI would still be in contention, given what they have achieved to Bristow in Broome

Race to the bottom ?

Brother

15th Jan 2018, 13:28

Race to the bottom ?

come on Belly, its not like that, look at Babcock, Toll and now PHI, all meeting the new market reality. BRS crews and engineers voted down the pay restructure idea, how can they compete if the work force won't help. They're all highly paid captains over there with no co pilots, they cant win a job. You need to work out your bottom is the new normal for survival. a slightly smaller pay slip is better than the dole.

Lude-og

16th Jan 2018, 06:11

https://www.lifeflight.org.au/page/careers/Aviation_Careers/Aviation_Positions_Available/Rotary_Wing_Co-Pilots/

I see LifeFlight are looking for more "Co-Pilots".....

Certainly isn't a race to the bottom with these sorts of minimum requirements for a 500hr total heli time gig.

Twist & Shout

16th Jan 2018, 07:12

come on Belly, its not like that, look at Babcock, Toll and now PHI, all meeting the new market reality. BRS crews and engineers voted down the pay restructure idea, how can they compete if the work force won't help. They're all highly paid captains over there with no co pilots, they cant win a job. You need to work out your bottom is the new normal for survival. a slightly smaller pay slip is better than the dole.

All creating a new market reality. (That suits no one, but the contract bean counters. In the short term)

The “slightly* smaller pay slip is better than the dole” comment is one of the most ignorant for a while. :D

* for now. But in a race to the bottom, everyone has to get closer to the bottom at every opportunity, or you’ll lose. (The race)

Evil Twin

16th Jan 2018, 07:24

NumptyAussie

16th Jan 2018, 08:04

come on Belly, its not like that, look at Babcock, Toll and now PHI, all meeting the new market reality. BRS crews and engineers voted down the pay restructure idea, how can they compete if the work force won't help. They're all highly paid captains over there with no co pilots, they cant win a job. You need to work out your bottom is the new normal for survival. a slightly smaller pay slip is better than the dole.

15% management proposed is not really "slightly smaller"....the 5% cut that the staff offered to take, could however be construed as such..

gulliBell

16th Jan 2018, 08:55

..I see LifeFlight are looking for more "Co-Pilots".....

Certainly isn't a race to the bottom with these sorts of minimum requirements for a 500hr total heli time gig.

I can never understand how they come up with some of those numbers. Only 100 hours PIC required, but they want Command Instrument Rating for a co-pilot position. If a guy is squared away enough to hold a Command Instrument Rating some of those other numbers seem quite meaningless.

Brother

16th Jan 2018, 10:13

The “slightly* smaller pay slip is better than the dole” comment is one of the most ignorant for a while.

ignorant (but realistic) calling twisty, over

I have been on the dole before down at the dole office collecting my handout. the mrs hated it, kids to feed, mortgage to pay etc. Now i might have a slightly smaller pay slip than some in other companies or it might not be much smaller in reality. but i know that i will still have a job this time next year. i may be ignorant in your opinion but i am employed with good pay in my opinion. dole money doesnt care how big your pay slip is.

Twist & Shout

17th Jan 2018, 07:21

ignorant (but realistic) calling twisty, over

I have been on the dole before down at the dole office collecting my handout. the mrs hated it, kids to feed, mortgage to pay etc. Now i might have a slightly smaller pay slip than some in other companies or it might not be much smaller in reality. but i know that i will still have a job this time next year. i may be ignorant in your opinion but i am employed with good pay in my opinion. dole money doesnt care how big your pay slip is.

Are you assuming that the only two options were “dole” or a “smaller payment”?
What about the third option: “industry standard payment”? (Hard won, and deserved. IMHO)

Are you assuming that if one operator had not decided to base their business model on “cheapest” and relied on pilots on the dole being willing to accept a lower Pay and conditions, and tender accordingly, that the operation on which you currently fly would have been shut down?

(I’d suggest another, more expensive/established operator would have been awarded the tender, and probably offered you a job, on “slightly more” remuneration than you are on now.)

We are arguing over very little. (And occasionally comparing individual circumstances with whole of industry concepts.)
I hope we can all stick together a bit, and not contribute to a race to the bottom, which will be bad for everyone, including the clients. (Eventually.)

Have a great day all my fellow pilots.:ok::ok:
(You are all worth more money!)

fadecdegraded

17th Jan 2018, 07:45

I can never understand how they come up with some of those numbers. Only 100 hours PIC required, but they want Command Instrument Rating for a co-pilot position. If a guy is squared away enough to hold a Command Instrument Rating some of those other numbers seem quite meaningless.

What other type of instrument rating is there these days I think a command instrument rating is the only one you can get.
I think we all know that a fresh command instrument rating with no renewals is prob not the guy you want as a captain which is why you see the job adverts for captain asking for several renewals.
Just saying

Brother

17th Jan 2018, 08:24

ok twisty, i won't argue if its not over much.

(I’d suggest another, more expensive/established operator would have been awarded the tender, and probably offered you a job, on “slightly more” remuneration than you are on now.)

which tender?

Lude-og

17th Jan 2018, 09:21

What other type of instrument rating is there these days I think a command instrument rating is the only one you can get.
I think we all know that a fresh command instrument rating with no renewals is prob not the guy you want as a captain which is why you see the job adverts for captain asking for several renewals.
Just saying

A CIR is all there is now yes, unless you already had a current Co-Pilot Instrument rating before they unceremoniously pulled the plug on that one, in which case I believe you may still be able to renew that, but I only heard that from someone else so I could be wrong on that one.

But the point still remains that if you already have a 139 type rating with a command instrument rating then you are probably already pretty well set up (and more than likely already gainfully employed on a multi), as gullibell alluded to.

Call me a sook but it was a kick in the balls for many when they took away the Co-Pilot Instrument rating and pretty much turned it into carbon copy of EASA IR requirements to have to shell out for an instrument rating in a twin to be employable in the Offshore/EMS world in Australia.

gulliBell

17th Jan 2018, 12:14

..I think we all know that a fresh command instrument rating with no renewals is prob not the guy you want as a captain which is why you see the job adverts for captain asking for several renewals.
Just saying

I've done Command IR renewals on a few helicopter pilots who supposedly had many previous IR renewals that were so mind boggling inept they shouldn't even hold a Co-pilot IR. So a pilot who has recently passed a Command IR initial to the proper standard should be OK to PIC an AW139 under IR, but obviously under line flying supervision of a TRI initially.

Twist & Shout

18th Jan 2018, 02:18

ok twisty, i won't argue if its not over much.

which tender?

Is this a serious question?

The tender submitted to win the contract on which you are currently flying. (For “a little bit less”)

My suggestion is that had the lowest/winning bidder (your current employer) not submitted a tender, someone else would have won the work, and just as many pilots would be employed. (Hopefully you, on a slightly better wage.)

The “race to the bottom” which you deny, or don’t understand, is what your company is currently feeding.

When you were on the dole, you didn’t get cheaper petrol. You paid the going rate. (Despite the “new economic reality” you found yourself in.)
If someone started selling cheaper petrol by paying their staff less and having less of them, reducing their quality control, not paying their rent on time, and reducing their insurance coverage, we all might be happy for a while (those buying the fuel, not the staff!). Then to compete, in the race to the bottom, what do the other petrol stations selling less/no fuel do?

Under the model you are supporting, every new contract will required pilots taking a cut in Pay and conditions to compete. There is no end to it, or the consequences.

Have a great day.

industry insider

18th Jan 2018, 14:34

The tender submitted to win the contract on which you are currently flying. (For “a little bit less”)

Twist and Shout, the contract Brother flies was not tendered, it was negotiated as the incumbent couldn’t supply the capacity. Brother’s question is therefore correct, you are wrong and unnecessarily condescending to him.

rrekn

19th Jan 2018, 04:43

212man

19th Jan 2018, 15:44

ATSB have released the final report on the winching incident:

Investigation: AO-2017-095 - Winching event involving Sikorsky S92A, VH-IPE, near Broome, Western Australia, on 26 August 2017 (http://www.atsb.gov.au/publications/investigation_reports/2017/aair/ao-2017-095/)

As a result of this serious incident, the operator .......... appointed experienced personnel to new search and rescue management positions

What a novel idea!

gulliBell

20th Jan 2018, 13:31

I'm really surprised that the sudden release of 90 lbs of force on the hook would cause it to recoil like that.

rrekn

21st Jan 2018, 04:32

Shows poor design of the hi-line on two counts:

1 - The weak link used a commercial nylon snap buckle.
2 - The line used was elasticated and hence allowed the load that built in the line to release and recoil.

Other experienced SAR operators in Australia use mil-spec cord for the weak-line which has a defined break strength. Use of commercial products like this always runs the risk of the supplier changing the design of the product without alerting the end user. From the report looks like they 'improved' the buckle then making the end ring the weak point.

Looks like Priority One is still selling these:

https://priority1airrescue.net/product/breakaway-weak-link/

Someone in Australia should set up a one-stop SAR shop to sell this equipment to the rest of the industry. Maybe we should call it SARQUIP.

rotor-rooter

18th Sep 2018, 15:50

http://www.helicopterinvestor.com/articles/waypoint-starts-negotiations-with-lenders-over-covenants-097/

This is a very interesting story, as it is the continuation of the downstream distress from the CHC bankruptcy. The reluctance of the Principals to further invest, and the inability to divest the business are pretty hard indicators of the current status of this sector.

nowherespecial

20th Sep 2018, 20:11

Looks like Babcock are trying to get out of offshore crew change. From their results yesterday:
This process will continue in the second half of this year, where we expect to exit our powerlines business in South Africa. We will also reshape our oil and gas crew change business to improve performance while ensuring we meet customer needs. We will provide an update on these activities with the announcement of our half year results in November.

The call transcript had the CEO saying it was still profitable for them but they are clearly looking to sell. Note nothing was said about the onshore EMS business.

Ed Winchester

21st Sep 2018, 09:28

It wasn’t from their results, it was a market update. Here’s what he said when asked directly about the crew change business:

“Second, one was the crew change business. Sorry, yes. Yes. I mean, I think it’s quite early days. I mean, we signaled -- we clearly signaled at the year-end when we put the focus -- when we cleared this up and put our focus in defense, emergency services, and nuclear. The crew change, the offshore oil and gas business was not seen by us as a kind of a critical part of the business. So, again, that, I guess, kicked off an exercise that says, well, what happen to that business? Do we -- how do we operate it? It’s a reasonable-sized business. It’s still profitable. And I think all the segment here is we’re going to look at what we can do with it in terms of making it the best we possibly can, whilst of course, still maintaining top priority and safety and meeting our customers’ kind of needs. But, we do feel that the business is -- the oil and gas business overall in our sector has stabilized, although somewhat still not great. But, I think we want -- we --- the business will be there. Questions of what we do with it in the long term. Again, the exercises we’ll do in the moment may lead us toward some kind of conclusions here. Then the first instance is all about us taking actions around about making sure that we’re making the best of that business that we possibly can at the moment.”

So something was said about the onshore EMS business - it falls within one of Babcock’s main focus areas - emergency services.

Ah well, at least crew change is profitable. I wonder if the same can be said of some of its competitors....

Brutal

27th Sep 2018, 08:18

tqmatch

30th Sep 2018, 10:20

If onshore want to recruit and retain pilots in the future they will seriously have to look at paying more than what is being offered! There are way fewer guys leaving the forces, and depending on their original joining date with H.M., will not have immediate access to their pensions to boost their pay...there's a huge number of guys reaching 60 soon, offshore is picking up, the airlines are booming, HEMS day VFR ops going into IFR, night, and unsociably hours than before but expecting to pay the same....and for the first time onshore is using types 145/169 that offshore is now using...lots of guys defected already from SAS/Babcock to go offshore doing the wind farm work with unifly/wiking etc as they get a substantial pay increase, and ironically only work day vfr??? Just shows how poorly paid our Hems is!!
Banging my head against a brick wall trying to recruit onshore....with the usual excuses from management but even they acknowledge we are going to have to do something drastic soon, as vacancies being left unfilled for far too long, and it is not going to get any better..
B.

Personally I think as an aside to the pay, the whole experience criteria in the UK specially needs some attention. I'm not suggesting putting a fresh 185hr CPL on to a type rating course and letting them loose, but in reality if a HEMS pilot needs 2,500hrs plus 135/145 type rating, plus significant low level experience, plus winching experience etc etc where are these going to come from if not ex-mil? If pay is well below par, where do companies expect to get pilots from?

Personally I've ticked the box with exams, built up hours to get above the minimum for carrying out the practical part of the CPL course, but now I've stopped. I don't want to instruct to the 2,500hr point before I'm eligible for another type of job, typically as I don't see a great rush of fresh PPL(H) students on the sideline, so the 2,500hrs may well take years, and those years would be spent earning around £40-£50 an hour whilst flying, everything else for me as an instructor would be "free". I don't know if it's worth gaining my CPL/ATPL anymore. I've often been tempted to approach operators such as SAS or Babcock etc to ask about acting as supernumerary crew, but I don't think this could even be possible in today's heavily legislated industry.

havick

30th Sep 2018, 14:11

Personally I think as an aside to the pay, the whole experience criteria in the UK specially needs some attention. I'm not suggesting putting a fresh 185hr CPL on to a type rating course and letting them loose, but in reality if a HEMS pilot needs 2,500hrs plus 135/145 type rating, plus significant low level experience, plus winching experience etc etc where are these going to come from if not ex-mil? If pay is well below par, where do companies expect to get pilots from?

Personally I've ticked the box with exams, built up hours to get above the minimum for carrying out the practical part of the CPL course, but now I've stopped. I don't want to instruct to the 2,500hr point before I'm eligible for another type of job, typically as I don't see a great rush of fresh PPL(H) students on the sideline, so the 2,500hrs may well take years, and those years would be spent earning around £40-£50 an hour whilst flying, everything else for me as an instructor would be "free". I don't know if it's worth gaining my CPL/ATPL anymore. I've often been tempted to approach operators such as SAS or Babcock etc to ask about acting as supernumerary crew, but I don't think this could even be possible in today's heavily legislated industry.

switch to fixed wing, the industry booming.

Spunk

30th Sep 2018, 19:27

switch to fixed wing, the industry booming.

but it’s boring��

dingo9

30th Sep 2018, 20:17

Brutal

1st Oct 2018, 09:25

And Offshore flying isn't mind numbingly boring? Especially as you rarely actually get to fly the machine like a helicopter anyway?
B.

Spunk

1st Oct 2018, 12:50

And Offshore flying isn't mind numbingly boring?

There is more out there than just flying offshore. I wouldn't say that I've never looked into flying offshore but today I'm glad I didn't go that direction. I love what I do (a little bit of everything: VIP-Taxi, aerial work, scenic flights, flight instruction etc.) and yes, I make a decent living doing so.

tqmatch

1st Oct 2018, 13:36

Plank wing would be an option, if I simply wanted to fly for a living without care for what I was flying; however I don't I want to fly helicopters. I flew planks (kind of) as an instructor for the Air Training Corps some years ago, and it just did not & does not hold the magic of helicopters.

I'm not in anyway deluded enough to think that I'm going to walk into any type of HEMS captaincy role, and that CHC are magically going to call me one day and say "Hey there, we read your moaning on PPRUNE and you're right, you deserve a break, your S92 type course starts next Monday....."

But FW guys new to the industry do get a leg up in some ways, there are avenues out there for them where they can enter and join the party, but in the RW side of things, it looks like there is only instructing or nothing - surely if we want to encourage new blood, and young blood at that to keep our industry alive then we need to have something to get people interested and keep them interested? cadetship, First Officer, Supernumery Crew, there *could* be many ways if we used our collective brain powers and not presenting problems for all solutions?

ShyTorque

1st Oct 2018, 19:19

I never wanted to be a pilot....

https://www.youtube.com/watch?v=sZa26_esLBE

Torquetalk

1st Oct 2018, 21:09

Woosh and ‘twas gone! Pretty unfortunate turn of phrase 😂

industry insider

2nd Oct 2018, 00:44

Some economists are predicting $100 oil due sanctions on Iran, the offshore market is picking up.

Robbiee

2nd Oct 2018, 03:32

sudden twang

2nd Oct 2018, 14:21

Throwing a wide body plank around a circling approach in mountainous terrain is every bit as exciting as SP ME heavy helicopter slinging at night. Without taking inflation into account, 22 times the pay so you can buy your own helicopter. So it’s worth a thought but I’d admit I’d accept a huge pay drop to be an SAR P2 out of Lee or Portland.

jeepys

2nd Oct 2018, 15:39

It would have to be Lee as Portland closed for Coastguard ops a while back.
If the opportunity came up would you really take a big pay cut from FW?

DeltaNg

2nd Oct 2018, 16:56

Sorry did you just say 22 times the pay?

sudden twang

2nd Oct 2018, 17:13

I’ve taken a pay cut to go part time FW and would love a RW part time P2 slot. SAR would be even better.
Im lucky tho kids grown up top ( ish) of FW tree nice pension pot.
Ive always been mindful of taking food off the table of those on the way up.
I can with 20/20 hindsight see the pros and cons of onshore / offshore RW and FW.

dingo9

2nd Oct 2018, 19:20

... sorry again did you say 22 times the pay!? I make that to be nearly £2 million a year. Where do I sign, I’m definitely going plank 😆😆

DeltaNg

2nd Oct 2018, 19:28

Yes come on tell us how much your take home is !

Torquetalk

2nd Oct 2018, 20:51

Yes come on tell us how much your take home is !

He works for Turkish Airlines and is paid in Lira

sudden twang

2nd Oct 2018, 21:00

Its easy to check, junior officer 33 years ago versus top pay scale in an airline. Some not me play the system when the airline is short of crews and increase their pay by 50% and many gain tax breaks by living out of the U.K.
The point I’m making bearing in mind the thread is about the state of the industry and someone compared it to FW is that
there are pros and cons in both markets but it’s easy to say FW is boring and RW is exciting in your early 20s but the picture may look v different in your mid 50s.
I cant however imagine coming out of L3 with a frozen ATPL joining EZY and spending 40 years there. Horses for courses.

sudden twang

2nd Oct 2018, 21:02

Turkish is not the place to go according to other forums here.

helicrazi

2nd Oct 2018, 21:02

Even taken 50% extra etc, you still aren't getting 22 times, or circa 2 mil.

sudden twang

2nd Oct 2018, 21:10

2 million divided by 22=?
Not sure the defence budget would stand that.

tqmatch

4th Oct 2018, 18:39

https://ottawacitizen.com/news/local-news/canada-faces-severe-shortage-of-pilots-and-aircraft-workers?utm_source=skies-daily-news-news-from-the-web&utm_campaign=skies-daily-news&utm_medium=email&utm_term=news-news-from-the-web&utm_content=V1

Found this article about our friends over in Canada, another page on the same site also said that there are some companies in Canada who have helicopters parked up already due to a shortage of crews to fly them - anyone currently in Canada or with knowledge care to comment?

Twist & Shout

4th Oct 2018, 23:29

Non type rated pilots are still being employed, and type rated in Off Shore, Australia.
A good sign.

newfieboy

4th Oct 2018, 23:31

Yeah.
Me��*♂️ We’re busy......

Lude-og

5th Oct 2018, 06:21

Non type rated pilots are still being employed, and type rated in Off Shore, Australia.
A good sign.
That is indeed good to hear. What company if you don't mind me asking? Or a PM would be appreciated

Twist & Shout

5th Oct 2018, 07:52

That is indeed good to hear. What company if you don't mind me asking? Or a PM would be appreciated

I don’t want to go into it in too much detail. There is not, as far as I know a position available right now.
The pilot in the Simulator last week, for a type rating, informed me he had responded to an advertisement.

My intention was to provide an update on the “State of the Industry”, in OZ Off-Shore.

(PM on the way)

Mark Six

5th Oct 2018, 07:52

That is indeed good to hear. What company if you don't mind me asking? Or a PM would be appreciated
Yes I'd also be interested to hear which company. CHC and Bristow have both been making forced and voluntary redundancies this year and AFAIK haven't hired any new offshore pilots in the last year or two. There are still plenty of unemployed and highly qualified ex-Bristow pilots waiting to fill offshore vacancies. A few have gone to Esso/HNZ but they were already type rated.

Twist & Shout

5th Oct 2018, 11:16

Yes I'd also be interested to hear which company. CHC and Bristow have both been making forced and voluntary redundancies this year and AFAIK haven't hired any new offshore pilots in the last year or two. There are still plenty of unemployed and highly qualified ex-Bristow pilots waiting to fill offshore vacancies. A few have gone to Esso/HNZ but they were already type rated.

I believe a few ex Bristow guys went to Babcock a while ago, (approximately 6 months ago?) and received S92 type ratings.
Babcock are also running AW139s out of Barrow island.....

Bristow Australia are, very unfortunately, letting experienced long time pilots go. It’s very bad in that camp right now.

CHC Australia have made no forced redundancies, and denied a large number of voluntary redundancy applications. Several pilots have resigned recently (no redundancy). Another positive sign that the industry is picking up.

Oil i$ up. More work is projected.. The current pilot work force is aging. No one is “coming up”. Some of the smarter, younger guys, who should be the “future” are changing to Fixed Wing. It’s basically the perfect storm for an Experienced Off Shore Pilot shortage.

Jeffory

5th Oct 2018, 12:50

I believe a few ex Bristow guys went to Babcock a while ago, (approximately 6 months ago?) and received S92 type ratings.
Babcock are also running AW139s out of Barrow island.....

Bristow Australia are, very unfortunately, letting experienced long time pilots go. It’s very bad in that camp right now.

CHC Australia have made no forced redundancies, and denied a large number of voluntary redundancy applications. Several pilots have resigned recently (no redundancy). Another positive sign that the industry is picking up.

Oil i$ up. More work is projected.. The current pilot work force is aging. No one is “coming up”. Some of the smarter, younger guys, who should be the “future” are changing to Fixed Wing. It’s basically the perfect storm for an Experienced Off Shore Pilot shortage.

Very likely scenario, but nobody wants to invest in the future. No operators will care unless you bring your own TR and IR, so it's a lost cause for 'younger guys'.

Looking at the bigger picture, airline flying isn't that dissimilar to offshore flying, you just have better progression and security with FW. Why wait for the fabled resurgence of O&G when you could be out of work within 6 months of starting, all whilst having zero other options when it does?

Twist & Shout

5th Oct 2018, 13:25

Err, yes, If... you have an S92, AW139, AW189 or EC175 type rating.

If you don't, get to the back of a very long queue (here in the UK)

You read my post right?
1. Australia
2. Pilots are being given type ratings. S92, and AW139 that I’m aware of.

maeroda

6th Oct 2018, 10:24

Any flying becomes boring after multiple thousand hours. Trust me. Don’t get me wrong I’d rather do this than sit in an office, but it will eventually just become a job to you. Go with the money and the jobs... ie Fixed wing. Rotary self financed just doesn’t make sense.

I respectfully disagree about this statement, let me clarify my point please.
In my 22 years aviation career with EASA license I have flow aerial work, then HEMS (the Italian kind, which is single pilot / multi pilot involving HAA, HEMS and mountain SAR-HHO all mixed together in H24/365 operations), then VVIP flying African country presidents, then offshore OGP (with CHC and Babcock) I can say HEMS is definitely a kind a job I would never get bored about.
On the other hand, Offshore is very boring as well as repetitive aerial work.
Salary: minimum level in aerial work, maximum at offshore OGP, HEMS intermediate level.
My opinion.

rotor-rooter

26th Nov 2018, 07:11

It's taken some time for this to occur and Waypoint has been a widely discussed subject within the industry for the last 6 months. The biggest question is whether this is the beginning of a greater round of readjustment in the industry, with additional players in every arena of the market in similarly dire straits.
https://www.verticalmag.com/press-releases/waypoint-leasing-files-for-chapter-11-bankruptcy-protection/

SASless

26th Nov 2018, 12:04

Bristow Australia are, very unfortunately, letting experienced long time pilots go. It’s very bad in that camp right now.

Once Bristow saw the Founder part with the company...."Loyalty" departed with him.

Unlike the Airlines....sadly Seniority means nothing in the Helicopter Industry.

It might garner you some extra Schillings but at some point it becomes a poison pill that ends your career progression or employment.

The Operators cry and moan about the lack of loyalty of the pilots and engineers but refuse to look at their own conduct.

The cyclical nature of the business is part of the cause for the problem as few Operators can absorb downturns in business without discarding excess staff.

I can recall Pilots in the Gulf of Mexico being let go immediately upon landing at the Operation's Base....following the loss of a Contract (talk about no notice, no redundancy pay, no offers of compensation whatsoever).

Then....the very next day the same pilots were asked to return as there had been a new contract obtained.

In the old Days....Bristow had a "Gardening Leave" policy that was very much liked by those who wished to take some time off at reduced pay....but those days are long gone.

212man

28th Nov 2018, 14:35

TeeS

28th Nov 2018, 14:45

Can somebody translate this into English?
https://helihub.com/2018/11/28/bristow-group-announces-completion-of-consent-solicitation/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+HelihubNews+%28HeliHub.com+%C2%BB+Daily +News+Update%29

This (http://www.nbcnews.com/technolog/put-down-batleth-try-klingon-english-translator-1C9925541) might help!

TeeS

9Aplus

28th Nov 2018, 15:17

One word summary&translation: default :(

rotor-rooter

17th Jan 2019, 13:03

More turbulence coming? GE considering disposing of GECAS, which includes Milestone. https://www.cnbc.com/2019/01/17/john-inch-ge-headed-lower-because-gecas-worth-less-than-40-billion.html

"Moreover, we do not believe that GECAS would fetch anywhere close to the book value of its assets in a potential sale, while the proceeds to GE could end up a fraction of the sale price," Inch added.

GECAS had a "book value" of $40.6 billion as of the third quarter of 2018. Inch said he believes the business is "worth far less" than that. Instead, Inch said "third party assessment" shows the GECAS aircraft leasing portfolio is worth $25.8 billion, rather than $32.8 billion, and the GECAS helicopter leasing group is worth $2 billion, rather than $4 billion.

And the potential buyer? https://www.cnbc.com/2019/01/07/buyout-firm-apollo-eyes-deal-for-ges-aircraft-leasing-unit-sources.html
Apollo's bid comes as GE's new chief executive officer, Larry Culp, is battling to restore profits and slash debt after the industrial conglomerate lost $22.8 billion in the third quarter, mostly from its ailing power unit.

JulieAndrews

22nd Jan 2019, 13:19

Would it be possible to disseminate company Terms and Conditions here?
Always a good indicator of 'State of Industry'.
I cant kick the ball rolling as don't have any - or at least none that would stand up in an employment tribunal !

barbados sky

3rd Feb 2019, 10:28

Rumour that Bristow Australia will be forced to make more pilot and other redundancies as Inpex has cancelled its contract in Broome. Inpex was the only long term contract Bristow Australia had for the 92s. Obviously the flight attendant idea was not successful.

So Bristow is only left with the Beach Energy contract in Tooradin which is only 1x AW139 with a backup and some drilling work in Karratha coming up. Not much to run the expensive head office, big hangars in Karratha and Air North.

Sorry for all the Bristow people who are going to lose their jobs because of Darwin and Perth management.

Evil Twin

3rd Feb 2019, 10:48

Nescafe

4th Feb 2019, 01:02

BHA is well on its way to achieving its goal of “Target Zero” assuming the “Zero” is pilots, engineers, clients, aircraft etc.

There will be more than a few pilots rueing their part in the ‘no vote’ campaign, when the company asked them to accept a pay cut. They declined a 15% cut then, only to face a 100% cut now!

HeliMannUK

4th Feb 2019, 05:57

driftwood1

4th Feb 2019, 07:54

Pretty sure it wasn’t Darwin or Perth managements idea to fill a helicopter with strippers !!!!!!!!!!! that lays squarely in the hands of the driver.
i wonder if it was realised that this little stunt was going to have such an impact on so many others.
selfish Tool...........

Rumour that Bristow Australia will be forced to make more pilot and other redundancies as Inpex has cancelled its contract in Broome. Inpex was the only long term contract Bristow Australia had for the 92s. Obviously the flight attendant idea was not successful.

So Bristow is only left with the Beach Energy contract in Tooradin which is only 1x AW139 with a backup and some drilling work in Karratha coming up. Not much to run the expensive head office, big hangars in Karratha and Air North.

Sorry for all the Bristow people who are going to lose their jobs because of Darwin and Perth management.

Nescafe

4th Feb 2019, 08:32

I doubt that the incident you relate to would have made much difference, the die was cast a long time ago. To have 140+pilots 4 years ago and be down to 25-30 today is much more indicative of the sources of the problems.

Poor management during challenging times and a concerted campaign by some senior pilots to scupper the pilot body’s offer to reduce salaries to help out. They are about to reap what they sowed.

Evil Twin

4th Feb 2019, 09:16

Nescafe I agree with your first point but not necessarily your second. No pay cut in the world can change the fact that if the company needs ten bums on seats they will only pay for ten bums. There is no loyalty from either side in business anymore, if there's any it will come from the employee and very rarely the employer, they generally are only interested in the opinion of the bean counters.

I could let the evil go on an uber rant on this subject but I won't.

Cheers ET

Nescafe

4th Feb 2019, 09:55

No pay cut in the world can change the fact that if the company needs ten bums on seats they will only pay for ten bums.

That is true, but if those 10 bums cost less, then operating costs are less and then tenders can be cheaper, and then there’s more chance of hanging on to your hard earned market share.

Evil Twin

4th Feb 2019, 10:41

That is true, but if those 10 bums cost less, then operating costs are less and then tenders can be cheaper, and then there’s more chance of hanging on to your hard earned market share.

or the exec’s get a bigger bonus and the bus drivers get a bigger anal probing 😉

SASless

4th Feb 2019, 10:42

There will be more than a few pilots rueing their part in the ‘no vote’ campaign, when the company asked them to accept a pay cut. They declined a 15% cut then, only to face a 100% cut now!

What cuts were the kind hearted folks in Management going to take to prove their commitment to the concept of "helping out"?

Perhaps that played a role in these hard headed pilots voting as they did.

212man

4th Feb 2019, 10:53

or the exec’s get a bigger bonus and the bus drivers get a bigger anal probing 😉

Yes, I recall the BHL bonus scheme - "don't bonus, we'll bone you"!

industry insider

4th Feb 2019, 12:32

Driftwood

Pretty sure it wasn’t Darwin or Perth managements idea to fill a helicopter with strippers !!!!!!!!!!! that lays squarely in the hands of the driver.
i wonder if it was realised that this little stunt was going to have such an impact on so many others.
selfish Tool...........

As Nescafe says, silly but probably had nothing to do with the Inpex contract being cancelled after 5 years. It was originally a 10 year contract. Its more likely the Inpex field coming into production and now not needing as many helicopters. Mind you, Inpex had 2 operators to choose from when it came to downsizing.

rotor-rooter

11th Feb 2019, 21:14

There's a lot going down right now at Bristow.

"The Company is evaluating whether this material weakness in internal controls over financial reporting resulted in a misstatement in the Company’s financial statements included in the Annual Report on Form 10-K for the fiscal year ended March 31, 2018 and the impact on the financial statements of the Company as of December 31, 2018, including disclosures. The Company is specifically evaluating whether certain debt balances should be reclassified from long-term to short-term in those financial statements, whether related waivers can be obtained from lenders, if necessary, and the resulting impact on the assessment of the Company’s ability to continue as a going concern."

Bristow Group Inc. - News Release (http://phx.corporate-ir.net/mobile.view?c=91226&v=203&d=1&id=2387002)

Nescafe

11th Feb 2019, 23:31

www.ainonline.com/aviation-news/general-aviation/2019-02-11/bristow-hints-bankruptcy-drops-columbia-deal

Bristow Group broadly hinted on Monday that its next move could be bankruptcy. The company abruptly canceled an analyst conference call scheduled for this afternoon, formally ended its attempt to acquire Columbia Helicopters for $560 million, filed notification of late filing of latest quarterly and nine-month financial results with the U.S. Securities and Exchange Commission, and admitted “material weakness” in internal controls over financial reporting dating back at least two years.

In a statement, Bristow said, “The company is evaluating whether this material weakness in internal controls over financial reporting resulted in a misstatement in the company's financial statements included in the annual report on (SEC) Form 10-K for the fiscal year ended March 31, 2018, and the impact on the financial statements of the company as of December 31, 2018, including disclosures. The company is specifically evaluating whether certain debt balances should be reclassified from long-term to short-term in those financial statements, whether related waivers can be obtained from lenders, if necessary, and the resulting impact on the assessment of the company's ability to continue as a going concern.”

The helicopter services company did release “preliminary” financial results that indicated it lost at least $262.2 million for the nine months ending Dec. 31, 2018, and $85.94 million in the fourth quarter alone. Those losses, if confirmed, are up sharply—it sustained losses of $94.78 million and $8.274 million, respectively, in the same year-ago periods.

In announcing the collapse of the Columbia deal, Bristow Chairman Thomas Knudson said, "The decision to enter into a mutual termination of the purchase agreement was based on a number of developments following the entry into the agreement, which led both Bristow and Columbia to conclude that it was not possible to combine the two companies at this time.” Bristow has paid Columbia a $20 million termination fee. Bristow announced its intention to acquire Columbia in November, but revealed a month later that it was having difficulty closing the deal.

Evil Twin

11th Feb 2019, 23:42

In the death throes it would seem

SASless

12th Feb 2019, 19:31

You cannot raid the cookie jar but so many times before it goes empty on you.

Those management salaries, bonuses, and perks should have been directly tied to profitability and growth along with preservation of assets.

You pay Winners.....and tie a can to the tails of the losers.

EESDL

13th Feb 2019, 16:19

Is there an up-to-date resource for showing who has what, where and with what which someone could direct me to?
One of those fancy maps with icons or just a simple list would do

Oil Company, Operator, Location, Aircraft Type, Number, Flight frequency/hours, Contract period, Remarks?

Remarks column could include whom previously had the contract or previous type......
Is this something HeliOffshore could help with as all the info is out there?
Happy to provide bandwidth if data is supplied.

industry insider

14th Feb 2019, 09:56

I wouldn't think so EEDSL, it would be way to commercially sensitive and allow a roadmap to target contracts.

Imagine all those very smart BD people such a list would put out of a job! What you suggest is what they are meant to do!

EESDL

14th Feb 2019, 10:41

well, another layer of management devolved..........
we all know an element of the story.
Oil companies and Operators are keen to saturate the media with yet another contract win etc etc, or the fact that such and such aircraft has been repainted etc
Majority of info is in the 'public' domain already - its just collating it.
and when it comes to BD folk using the info, we all know that 'contracts' hold no sway; it's how cheap I can operate that attracts the 90-day clause.

nowherespecial

14th Feb 2019, 12:15

EESDL, DM me.

rotor-rooter

16th Apr 2019, 18:22

Yesterday's news and ensuing share price are a pretty good indicator of what's coming next, and it's coming soon. https://www.ainonline.com/aviation-news/general-aviation/2019-04-15/bristow-flies-closer-bankruptcyBristow Flies Closer To Bankruptcyby Mark Huber (https://www.ainonline.com/mark-huber)
- April 15, 2019, 8:12 PM In the strongest hint yet that bankruptcy is on the table, helicopter services company Bristow Group said on Monday that it has yet to complete its financial report for the quarter ended Dec. 31, 2018, intentionally missed a $12.5 million interest note payment due April 15, and “is working diligently with its financial and legal advisors to best position the company for the future, both financially and operationally,” according to new CEO L. Don Miller.

Bristow also said it has hired the firms of Houlihan Lokey and Alvarez & Marsal as its financial advisors and Baker Botts L.L.P. and Wachtell, Lipton, Rosen & Katz as legal advisors. These firms all have strong bankruptcy experience. Notably, Alvarez & Marsal was hired to manage the distressed Zohar funds used to finance Lynn Tilton’s Patriarch Partners and its stable of companies, including MD Helicopters, in 2016. Investment banking firm Houlihan Lokey is also advising PHI Inc. on its recent bankruptcy filing.

The company stressed it still had $202 million on hand in cash and available credit under its asset-backed revolving credit facility (ABL), down from $237 million at the end of last year. Concurrent with its statement on Monday, Bristow filed an 8-K form with the U.S. Securities and Exchange Commission (SEC). Publicly-traded companies are required to file an 8-K whenever they have “unscheduled material events or corporate events.”

In its 8-K filed Monday, Bristow disclosed its survival strategy of selling off assets and renegotiating with lenders might not succeed and that a Chapter 11 bankruptcy filing might be inevitable. “We cannot assure you that any of our strategies will yield sufficient funds to meet our ongoing liquidity needs,” the company wrote. “We and certain of our subsidiaries may elect to implement such a transaction (default) through Chapter 11.”

Following the 8-K filing and announcement late Monday afternoon, Bristow’s stock nosedived from $1.14 to $0.59 per share in after-hours trading. Bristow said its overdue quarterly financial report would not be filed until June 19 “subject to certain conditions.” The company said it is taking advantage of a 30-day grace period not to pay the $12.5 million senior note interest “as it continues to work on its overall financing arrangements.”

industry insider

17th Apr 2019, 00:19

In its 8-K filed Monday, Bristow disclosed its survival strategy of selling off assets and renegotiating with lenders might not succeed and that a Chapter 11 bankruptcy filing might be inevitable. “We cannot assure you that any of our strategies will yield sufficient funds to meet our ongoing liquidity needs,” the company wrote.[b] “We and certain of our subsidiaries may elect to implement such a transaction (default) through Chapter 11.” So, nothing left to sell to finance loss making operations. With only $202m of cash and ABL remaining, BRS will need to file CH 11 soon or they will end up in CH 7. The management incompetence leading to the current state of the once mighty Bristow defies belief and explanation.

Krautwald

17th Apr 2019, 06:25

The management incompetence leading to the current state of the once mighty Bristow defies belief and explanation.

But isn't that the case with corporate culture in general? Profitable times tend to attract these certain personalities whose major interest in their job is seek to maximize personal benefit, and thus are prone to milk a company for fat salary packages and many other spendings on the management class; plus the cost of them not admitting having taken the wrong turn. Think new offices, expensive company cars, prestigious joint ventures only good for their own CV, all in all: a nonchalant, unreflected expectation that your employers business must provide you with not only a good income but a luxury lifestyle, and merely exists to fulfill your personal professional endeavours. Within those ranks, everybody feels free to grab what they can so nobody ever questions whether management is making sound decisions - they just confirm each other in being worth bonus after bonus and that its always a good time to have a new headquarter built in a triple A location. Since it is also perfectly normal for these people to jump ship when the well dries up, they don't know how to steer a business through rough waters - sticking it out loyally was never part of their plan, they just want to skim the cream wherever times are good at any given point.

Surely offshore flying was hit hard by bad oil and "one trick" companies suffer. But in all honesty, realistic management knows that already when the times are still good and would make provisions. Whatever happened to that? It used to be quite normal... and back then people where in general less educated than today.

Evil Twin

17th Apr 2019, 08:54

But isn't that the case with corporate culture in general? Profitable times tend to attract these certain personalities whose major interest in their job is seek to maximize personal benefit, and thus are prone to milk a company for fat salary packages and many other spendings on the management class; plus the cost of them not admitting having taken the wrong turn. Think new offices, expensive company cars, prestigious joint ventures only good for their own CV, all in all: a nonchalant, unreflected expectation that your employers business must provide you with not only a good income but a luxury lifestyle, and merely exists to fulfill your personal professional endeavours. Within those ranks, everybody feels free to grab what they can so nobody ever questions whether management is making sound decisions - they just confirm each other in being worth bonus after bonus and that its always a good time to have a new headquarter built in a triple A location. Since it is also perfectly normal for these people to jump ship when the well dries up, they don't know how to steer a business through rough waters - sticking it out loyally was never part of their plan, they just want to skim the cream wherever times are good at any given point.

Surely offshore flying was hit hard by bad oil and "one trick" companies suffer. But in all honesty, realistic management knows that already when the times are still good and would make provisions. Whatever happened to that? It used to be quite normal... and back then people where in general less educated than today.

WELL SAID!

SASless

17th Apr 2019, 17:13

AMEN! Brother....tell it!

EESDL

17th Apr 2019, 21:37

There must be a Biz Management degree to be had off the back of such a fall from greatness?
”how I steered a profitable company through good times to bad”

SASless

18th Apr 2019, 01:58

Snatching Failure from the Jaws of Success!

Winnie

18th Apr 2019, 04:37

Could it be that corporate greed took over?

Twist & Shout

18th Apr 2019, 11:09

Krautwald

19th Apr 2019, 06:25

If I taxied the Helicopter into a hanger, I’d likely be sacked and find myself unemployable.

If I managed to get the CEO’s position, and nose dived the company into bankruptcy, I’d likely get a bonus, then move on to bigger and better things.

It’s completely loopy.

And, during the years before that golden parachute saves you from full responsibility, you will justify getting paid a multitude of the regular salaries BECAUSE you hold all that responsibility.

If future history books will be any good, they will identify our time as an era of systematic accountability diffusion in favor of a large global „soft skill“ class of fraudulent character, whose members enjoy de facto imputiny.

The further away your job is from this sphere, the less diffusion you will enjoy and instead be fully accountable. While I lived in Germany some years ago, there was a famous case of a working-poor shop assistant who took a return receipt for recycling bottles that a customer had forgotten at her cashier. It was worth 50 cents. She was fired for it and I think two courts confirmed the dismissal. Since that happened around the time of the financial crisis, her case became a proverbial in Germany for our understanding of accountability.

Checklist Charlie

19th Apr 2019, 09:45

Accountability, now there's a novel thought.

A mob I used to work for regarded both accountability and regulatory compliance as "mandatory for staff and optional for management"

I wonder how some managers are able to keep a straight face with many of their pronouncements.

CC

DOUBLE BOGEY

20th Apr 2019, 07:02

Krautwald. How eloquently you describe the scumbags who have systematically destroyed this business.
the language the they use beggars belief. “Cash and revolving assists worth $203m......err but we might have to go bankrupt”. Mistakes were made in how debt was accounted for????

its financial gobbledegook for incompetence.

rotor-rooter

26th Apr 2019, 20:48

A commentary from Era on the current situation, maybe opening the door to their next direction?. If you have been following what is happening with Anadarko, then you might perceive that Era fears they may follow everyone else down a dark hole.

https://www.verticalmag.com/news/era-ceo-says-offshore-helicopter-industry-is-in-dire-need-of-consolidation/Era CEO says offshore helicopter industry is ‘in dire need’ of consolidationPosted on April 26, 2019 (https://www.verticalmag.com/news/era-ceo-says-offshore-helicopter-industry-is-in-dire-need-of-consolidation/) by Oliver Johnson (https://www.verticalmag.com/author/oliverjohnson/)
The president and CEO of offshore transport giant Era has said the current industry structure in the offshore helicopter business is not sustainable and is “in dire need” of consolidation.https://assets.verticalmag.com/wp-content/uploads/2019/04/DSC6655-1024x683.jpgAn Era-operated Leonardo AW189 flies offshore over the Gulf of Mexico. Dan Megna PhotoAdvertisement
https://assets.verticalmag.com/ad-placement/2019/02-february/aerolite/aerolite-vertical_website_february-2019_01_31-06_13_17.jpg (https://servedbyadbutler.com/redirect.spark?MID=168003&plid=608875&setID=205654&channelID=0&CID=174695&banID=519664553&PID=0&textadID=0&tc=1&mt=1556311323372748&hc=1d4c72edb8f93a63b8a58e3ba531a2cb4c96ebaf&location=)The remarks from Chris Bradshaw were made in a letter to shareholders within the company’s annual report, released April 24, in which he added that Era is “well-positioned” to take part in consolidation opportunities.

His comments follow the Chapter 11 bankruptcy filings of fellow offshore specialists CHC (https://www.verticalmag.com/press-releases/chc-group-files-for-bankruptcy-protection/) and PHI (https://www.verticalmag.com/press-releases/phi-inc-files-for-chapter-11-protection-with-u-s-bankruptcy-court/), and leasing company Waypoint (https://www.verticalmag.com/press-releases/waypoint-leasing-files-for-chapter-11-bankruptcy-protection/).

“Those who follow the offshore helicopter business understand that the current industry structure is not sustainable, with multiple helicopter operators and leasing companies having already filed for bankruptcy protection and others expected to follow suit shortly,” said Bradshaw.

He said a simple restructuring of debt is unlikely to address “the fundamental issues at play” — and may in fact only lead to a repeating cycle of restructuring.

“In our view, the offshore helicopter industry is in dire need of consolidation, amongst both the operators and the lessors,” said Bradshaw. “Consolidation will not only address the excess capacity in the industry, but will also facilitate better absorption of the significant fixed costs required to run an air carrier.”

He said a combination of any two of the three large deepwater helicopter operators in the Gulf of Mexico (PHI, Bristow and Era), would likely result in cost savings that would create significant value for their stakeholders.

“We have positioned Era such that the company is secure in a stand-alone scenario, despite the challenging industry conditions, and also well-positioned
to participate in value-accretive consolidation opportunities, should they become actionable,” he said.

Era’s financial results revealed a profit of $13.5 million in 2018, compared to a loss of $28.6 million the previous year. However, the 2018 figures included $42 million from Airbus Helicopters (https://www.verticalmag.com/news/airbus-and-era-settle-h225-lawsuit-for-42-million/) as part of a settlement of a lawsuit related to Era’s purchase of 11 H225 Super Pumas.

“We have experienced many rainy days over the last four-and-a-half years, but our business and balance sheet remain strong,” said Bradshaw. However, he noted that Chevron’s recent agreement to acquire Anadarko Petroleum Corp., a company that accounted for about 30 percent of Era’s revenues in 2018, is a cause of uncertainty.

“We believe the implications for the combined company’s helicopter transport needs will not be known until later in the integration process,” said Bradshaw. “At this time, it is too early for us to speculate on whether a transaction will have a positive, negative or neutral impact on our business.”

rotor-rooter

3rd May 2019, 04:24

https://www.flightglobal.com/news/articles/airnorth-and-eastern-could-be-sold-under-bristow-res-457851/

Activist shareholder Global Value Investment (GVIC) has drawn up an action plan for beleaguered Bristow Group – including disposing of two fixed-wing airlines – in a bid to stave off Chapter 11 bankruptcy protection.

Offshore helicopter specialist Bristow warned on 16 April that it had appointed advisers to explore restructuring options aimed at reducing its debt load, including Chapter 11, which would effectively wipe out several classes of investor.

GVIC has previously called for the removal of four Bristow board members, which it says have overseen "years of mismanagement" but is now pressing for urgent action to stave off Chapter 11, a move it argues is not in the interest of shareholders.

Under a three-pronged "operational plan", to be presented to Texas-based Bristow in the week of 6 May, GVIC would sell unprofitable or idle assets, aggressively cut costs and pay down or restructure debts.

Key assets for disposal include Airnorth and Eastern Airways, based in Australia and the UK respectively, which are both forecast to be negative on an earnings before interest, taxes, depreciation and amortisation (EBITDA) basis this year.

Bristow acquired both carriers to feed its helicopter operations, with limited success. GVIC believes it can attract buyers for the pair, to transform them into "regular scheduled airlines rather than running them on an industrial helicopter aviation model", says J P Geygan, GVIC vice-president.

"We have had conversations with a fixed-wing operator that was bewildered how inefficiently these airlines have been operated,” says Jeff Geygan, president and chief executive of GVIC.

Additionally, GVIC will propose that Bristow sell its 16-strong fleet of idled Airbus Helicopters H225s, which it believes can generate $80 million or upwards. These helicopters have been out of service for three years, with the operator making no attempt to dispose of them, says J P Geygan.

GVIC believes that with a strengthening of the balance sheet and repayment or renegotiation of its debts, Bristow's debt-to-EDITDA ratio can be cut to at least 6:1, down from about 12:1 at present.

In addition, GVIC says that “change in the boardroom and a change of management” is urgently required.

Former chief financial officer Don Miller was appointed as chief executive in February following the departure of predecessor Jonathan Baliff.

However, that appointment has been roundly criticised by GVIC, given Miller's oversight of the company's finances during a period in which Bristow has been unable to file its quarterly earnings.

"It is confounding to us that [Bristow] could not have found anyone better to be CEO," says Jeff Geygan.

He thinks there are numerous candidates – including GVIC's proposed board member Sten Gustafson – with industry experience who would "love to jump on board here" as chief executive.

Jeff Geygan says other shareholders have been "100% favourable" to its strategy, but "the company has remained silent in terms of communicating with us".

GVIC believes Bristow could file for Chapter 11 protection as early as 10 May, or around 16 May, when a $12.5m interest payment on its debt is due.

"We are 100% committed to defending the rights of equity holders in this situation; our plan would benefit customers, vendors, suppliers and employees as well," says J P Geygan.

GVIC owns 245,950 shares in Bristow, with a further 17,205 owned by executives. Shares have been trading at around $0.50 for the past month.

Although rivals CHC Helicopter and PHI have both entered Chapter 11 over the past three years, GVIC rejects any comparison, arguing that Bristow's circumstances are different.

Some past history and background.

https://www.bloomberg.com/research/stocks/private/person.asp?personId=54129747&privcapId=237313530&previousCapId=237313530&previousTitle=Seacor%20Overseas%20Investment%20Inc.Sten L. GustafsonPresident and Director, Seacor Overseas Investment Inc. (https://www.bloomberg.com/research/stocks/snapshot/snapshot.asp?capId=237313530)AgeTotal Calculated CompensationThis person is connected to 3 Board Members in 3 organization across 5 different industries.

See Board Relationships (https://www.bloomberg.com/research/stocks/private/relationship.asp?personId=54129747)51--BackgroundMr. Sten L. Gustafson has been Chairman of the Board at Golden Energy Offshore Services AS since February 2018. He served as the Chief Executive Officer of Era Helicopters, LLC. Mr. Gustafson serves as the President at Seacor Overseas Investment Inc. He served as the Chief Executive Officer of Era Group Inc. from April 1, 2012 to August 29, 2014. He served as Head of Energy for Americas of Deutsche Bank AG since June 2010. Mr. Gustafson served as a Managing Director of Global Oilfield Services Practice at Deutsche Bank AG since March 2009 and was responsible to develop DB's global oilfield services practice. Mr. Gustafson served as Global Head of Oilfield Services at UBS' Energy Investment Banking Group. During his banking career, Mr. Gustafson advised a wide range of energy clients in numerous strategic, debt and equity transactions around the world. Mr. Gustafson serves as a Director of Seacor Overseas Investment Inc. He serves as a Director of Era Helicopters, LLC. and has been its Director of Era Group Inc., since November 2012. Mr. Gustafson graduated from Rice University with a bachelor's degree in English and received his law degree from the University of Houston.

And after leaving Era, CHC.

CHC Group Announces New Management Structure | Collective Magazine (http://www.collectivemag.com/chc-new-management-structure/)

I'll let you fill in the blanks. With the current price of Bristow, I could pay cash right now to purchase equivalent equity that CGIV has in Bristow. If control of the company was taken over by an outside group and didn't file bankruptcy - well, there's a thing!

rotor-rooter

8th May 2019, 10:35

212man

8th May 2019, 12:32

Here it comes!

https://www.streetinsider.com/SEC+Filings/Form+8-K+Bristow+Group+Inc+For%3A+May+01/15466515.html

And the response (and more) fron GVIC.
https://www.prnewswire.com/news-releases/global-value-investment-corp-issues-open-letter-to-bristow-board-requests-meeting-to-present-operational-turnaround-plan-300845604.html
They are astonishing remuneration packages considering the dire straights they are in, although reflective of the US/Europe divide in corporate salaries. Potentially, if he achieves 200% target bonus award, Don Miller would be on around $9 million just in bonuses! That's pretty much the same as the total my CEO earns - of a (European) company somewhat larger and more profitable!

finalchecksplease

8th May 2019, 12:47

They are astonishing remuneration packages considering the dire straights they are in, although reflective of the US/Europe divide in corporate salaries. Potentially, if he achieves 200% target bonus award, Don Miller would be on around $9 million just in bonuses! That's pretty much the same as the total my CEO earns - of a (European) company somewhat larger and more profitable!

A disgrace, especially since he was part of the team (CFO) that got them in these dire straights.
Looks to me like they are trying to take as much as they can before the ship sinks, "Après nous, le déluge!"

DOUBLE BOGEY

8th May 2019, 13:07

Most surprising is the "Retention" payments. Have a large wad so you don't leave a sinking ship that probably will sink anyway and therefore you get to keep the wad cos we wont blame you for the sinking cos we is all in on the scam together. I hope every Bristow's employee gets to read those notices.

How can this, and the "Performance" bonus's be nothing other than corporate theft!

industry insider

8th May 2019, 13:41

GVIC is not as smart as they think they are. Anyone who thinks Air North is worth $70m is dreaming.

It’s owned turboprops (Metros and EMB120s) are 30 years old and can’t be crewed in the current climate with Air North pay and conditions so remain mostly parked against the fence.

The rest of Air North comprises 5x leased EMB 170s with owned engines. Bristow paid $30m+ at peak of the market in Jan 2015. Air North is the only airline in Oz operating Embraer 170s. Air North has some very thin routes unlikely to be of interest to any competitors.

P3 Bellows

8th May 2019, 16:12

How can this, and the "Performance" bonus's be nothing other than corporate theft!

I think you have hit the nail firmly on the head DB. They are a collection of shameless individuals who have no ability or talent to turn things round so are just filling their pockets before the wheels finally come off the helicopter.

P3

MalteseFalcn

10th May 2019, 13:36

Dirtnap

12th May 2019, 15:27

The industry is in the midst of a bounce back or somewhat of a recovery in my opinion. Offshore is coming back online. North Sea is getting new recuits. Wildfires have been exceptionally busy of recent. As a resultant, there is a lot of power pole survey to happen in the ravaged areas (look at California and Canada). The Middle East is opening back up. Not to mention the numbers of people leaving for planes.

Respectfully, you’re dreaming. The mom and pop operators are the ones reaping the benefits of the utility and fire work, since Era, CHC, and the Bristows of the world have little interest in diversifying.

Even if they did want to take take advantage of the better corners of the helicopter world right now, their fleets largely are configured for offshore work, and they don’t have the capital or the risk appetite for getting into utility, fire fighting, heliskiing, and all the rest.

Senior management at all the majors are from the banking sector or related areas, and probably have friends back in the equity firms waiting to give them a soft landing after their adventure into aviation.

Dirtnap

12th May 2019, 15:30

I think you have hit the nail firmly on the head DB. They are a collection of shameless individuals who have no ability or talent to turn things round so are just filling their pockets before the wheels finally come off the helicopter.

P3

100% agree. They know the ship(s) is going down, and they are either too incompetent to fix it, realized it too late, or don’t care anymore and are just sucking the companies dry for all the money they can before jumping back to their world of finance.

MalteseFalcn

12th May 2019, 22:50

Respectfully, you’re dreaming. The mom and pop operators are the ones reaping the benefits of the utility and fire work, since Era, CHC, and the Bristows of the world have little interest in diversifying.

Even if they did want to take take advantage of the better corners of the helicopter world right now, their fleets largely are configured for offshore work, and they don’t have the capital or the risk appetite for getting into utility, fire fighting, heliskiing, and all the rest.

Senior management at all the majors are from the banking sector or related areas, and probably have friends back in the equity firms waiting to give them a soft landing after their adventure into aviation.

I do agree in regards to the Offshore side, although it will start to climb a little after a few years at the bottom. Utility sector is doing well. Especially in Western US with electrical utilities wanting for cover of the asset structures as the lawyers are knocking on the doors after a bad fire season. Look at the international based companies involved in that area now.

rotor-rooter

29th May 2019, 23:58

A legal viewpoint of the current happenings in the helicopter world.
https://www.law.com/newyorklawjournal/2019/05/29/helicopter-industry-filings-connected-to-oil-market/?slreturn=20190429195201

rotor-rooter

7th Jun 2019, 21:22

A very interesting development in the PHI Chapter 11 case.
https://www.bloomberg.com/news/articles/2019-06-05/phi-nearing-deal-with-creditors-lawyers-tell-bankruptcy-judgeCreditors Oust Helicopter Company’s CEO in Bankruptcy CoupBy
Steven Church (https://www.bloomberg.com/authors/AOY9reFKwsk/steven-church)
and
Jeremy Hill (https://www.bloomberg.com/authors/ATsVYBQT7rw/jeremy-hill)June 5, 2019, 7:43 AM PDT Updated on June 6, 2019, 9:52 AM PDT

Low-ranking creditors use court mediation to take ownership
Proposed reorganization pays CEO cash, strips him of stock

https://assets.bwbx.io/images/users/iqjWHBFdfxIU/iyoFrxDpoKng/v1/1800x-1.jpgA PHI helicopter

Photographer: John Terhune/Journal and Courier via AP Photo

PHI Inc.’s unsecured creditors pulled off the bankruptcy equivalent of a palace coup during court-supervised settlement talks.

After just one day of mediation in front of a Texas bankruptcy judge, PHI’s chairman, majority shareholder and chief executive, Al A. Gonsoulin, lost his bid to retain control of the company, which provides helicopters for oil drillers and emergency medical providers.

Under the deal filed last night in federal court in Dallas, the official committee of unsecured creditors will drop its opposition to PHI’s reorganization plan, as well as the panel’s effort to sue company insiders, in exchange for 100% ownership, and Gonsoulin’s retirement.

That leaves a group of minority shareholders as the main opponent left to the reorganization proposal.

“This is a terrific result so far,” U.S. Bankruptcy Judge Harlin Hale said Wednesday during the hearing. “We have another piece of the puzzle with the equity committee, but I could not be more pleased.”

An attorney for Gonsoulin declined to comment.“This settlement represents a crucial and positive turning point in the case,” Lance Bospflug, PHI’s president and chief operating officer said in an emailed statement. “While we have work to do to satisfy the terms of the agreement, we continue to believe that our Chapter 11 filing and plan of reorganization represent the best course of action to address PHI’s matured debt and strengthen our balance sheet, while positioning the company for continued leadership.”

Unsecured creditors fought PHI for months in bankruptcy court by forcing changes to a management incentive plan that pays millions of dollars to seven executives, accusing insiders of being involved in a loan that was actually a fraudulent transfer and seeking to strip the company of its exclusive right to reorganize.Bankruptcy BreakthroughThe breakthrough came after one day in mediation on Friday with U.S. Bankruptcy Judge David Jones, said Dennis Dunne, a lawyer for the unsecured creditor committee.

Before the mediation, PHI had insisted that Gonsoulin be allowed to swap the $130 million loan he made to the company for a new equity stake, which would have allowed him to retain his ownership while his fellow stockholders saw their interest canceled.

Instead, Gonsoulin will be paid $132.5 million in cash and must retire and sign a contract not to compete with PHI or to make any disparaging comments about the company for three years. Gonsoulin’s retirement won’t occur until PHI’s bankruptcy plan takes effect, according to the term sheet.

Unsecured creditors will get ownership of the company and current stockholders, including Gonsoulin, will have their shares canceled. Gonsoulin owns more than 70% of the pre-petition voting shares in PHI, court papers show.

“We can see a broad path to” ending PHI’s bankruptcy, creditor committee lawyer Dunne said in court.

PHI filed for bankruptcy in March amid struggles across the helicopter transportation industry in the wake of declining energy prices. PHI’s filing came minutes before (https://www.bloomberg.com/news/terminal/POEZD36VDKHW) the maturity of $500 million in unsecured notes.

Unsecured creditors have battled the company in court through various motions and objections, arguing PHI should have filed for Chapter 11 as early as 2018, and that Gonsoulin’s loan (https://www.bloomberg.com/news/terminal/PR7JJW6K50XS) should have been recharacterized as equity because the terms were too sweet.

The company expects to emerge from bankruptcy in late summer, according to a company statement (https://www.bloomberg.com/news/terminal/PSOPCM3MMTC0).

The case is: PHI Inc., 19-30923, U.S. Bankruptcy Court, Northern District of Texas (Dallas)

rotor-rooter

19th Jun 2019, 13:29

https://www.thestar.com.my/business/business-news/2019/06/19/kkr-nears-partial-exit-in-weststar/KKR nears partial exit from Weststar

CORPORATE NEWS (https://www.thestar.com.my/business/tag/?q=%22Corporate+News%22&qkey=%7bF135C39C-E57D-49EE-9BBE-E787C8CA8DAF%7d)
Wednesday, 19 Jun 2019

7:23 PM MYT

image: https://www.thestar.com.my/~/media/online/2019/06/19/11/25/weststar-avi.ashx/?w=620&h=413&crop=1&hash=B662E4FAABB7D048F3FBE84A4E77F7D02329B776

https://www.thestar.com.my/~/media/online/2019/06/19/11/25/weststar-avi.ashx/?w=620&h=413&crop=1&hash=B662E4FAABB7D048F3FBE84A4E77F7D02329B776KUALA LUMPUR (Bloomberg): KKR & Co is nearing a deal to exit part of its stake in Weststar Aviation Services Sdn Bhd, Southeast Asia’s biggest provider of helicopters for the offshore energy industry, people with knowledge of the matter said.

The private equity firm is in advanced talks to sell a portion of its 40% Weststar holding to the company’s controlling shareholder, businessman Tan Sri Syed Azman Syed Ibrahim, according to the people.

Weststar could be valued at about US$2bil including debt, the people said, asking not to be identified because the information is private.

KKR, which has been an investor in Weststar since 2013, has seen delays to its attempts to sell out after a global slowdown in the energy industry hurt demand for oilfield services. Weststar started preparations the next year for an initial public offering in Kuala Lumpur, though the plan was later put on hold.

After selling part of its stake to Syed Azman, KKR will consider options for its remaining holding over the next year, the people said. It could opt to revive an IPO of Weststar or sell the rest of its stake to Syed Azman or another investor, the people said.

No final decisions have been made, and there’s no certainty the discussions will lead to a transaction, the people said.

A spokesman for Weststar confirmed Syed Azman is in talks with KKR on its stake in the Malaysian company and declined to comment further. A representative from KKR declined to comment.

KKR bought the stake in Weststar, which was its first Malaysian investment, for about US$200mil. Since then, Weststar has nearly doubled its revenue and expanded into new markets including the Middle East, Africa and Timor-Leste, according to the people.

The company plans to add around 10 more helicopters to its fleet, from about 30 currently, and is diversifying into areas such as search and rescue operations and emergency medical services to reduce its reliance on the energy industry, the people said.

Besides Weststar, KKR is also exploring a potential sale of Goodpack Ltd, a Singaporean provider of intermediate bulk containers that could fetch at least US$2bil, people familiar with the matter said earlier this month.

Read more at https://www.thestar.com.my/business/business-news/2019/06/19/kkr-nears-partial-exit-in-weststar/#KQyH47d170eYlkQs.99

rotor-rooter

17th Jul 2019, 22:41

https://www.bizjournals.com/houston/news/2019/07/08/struggling-helicopter-co-hires-ge-exec-as-general.html

Struggling helicopter co. hires GE exec as general counsel amid bankruptcy, litigation

Houston-based Bristow Group Inc., which filed for bankruptcy protection in May and is facing investor lawsuits, has hired a new in-house lawyer.

COMPANIES IN THIS ARTICLE

Bristow Group Inc. (https://www.bizjournals.com/profile/company/org_ch_b1eeb1c343df1b28d7b83141660eccdf?iana=comcard_seefull )

Houston, TX (https://www.bizjournals.com/profile/company/org_ch_b1eeb1c343df1b28d7b83141660eccdf?iana=comcard_seefull )

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$1.4BRevenue (https://www.bizjournals.com/profile/company/org_ch_b1eeb1c343df1b28d7b83141660eccdf?iana=comcard_seefull )

4,058Employees (https://www.bizjournals.com/profile/company/org_ch_b1eeb1c343df1b28d7b83141660eccdf?iana=comcard_seefull )

See full profile (https://www.bizjournals.com/profile/company/org_ch_b1eeb1c343df1b28d7b83141660eccdf?iana=comcard_seefull )

By Olivia Pulsinelli (https://www.bizjournals.com/houston/bio/12011/Olivia+Pulsinelli) and Chris Mathews (https://www.bizjournals.com/houston/bio/40196/Chris+Mathews) – Houston Business Journal

Jul 8, 2019, 2:44pm EDT

Houston-based Bristow Group Inc., which filed for bankruptcy protection in May (https://www.bizjournals.com/houston/news/2019/05/13/struggling-houston-helicopter-co-files-for-chapter.html) and is facing some related legal issues, has hired a new in-house lawyer.

Victoria Lazar (https://www.bizjournals.com/houston/search/results?q=Victoria%20Lazar) has been appointed senior vice president, general counsel and corporate secretary, the Houston-based helicopter company announced July 1 (http://ir.bristowgroup.com/news-releases/news-release-details/bristow-group-appoints-victoria-lazar-senior-vice-president). She previously spent more than 11 years with Boston-based General Electric Co. (NYSE: GE) in Houston, most recently as general counsel of mergers and acquisitions. She also was associate general counsel for GE Oil & Gas and led the merger with Houston-based Baker Hughes Inc. to form Baker Hughes, A GE Company (NYSE: GE).

Before GE, Lazar served in various roles at Electronic Data Systems Corp., now DXC Technology, from 1996 to 2008, and she was an associate at Houston-based Baker Botts LLP from 1990 to 1996. She has a J.D. from the University of Chicago Law School and a Bachelor of Arts in government from Cornell University.

It was not immediately clear whom Lazar is replacing. According to documents filed with the U.S. Securities and Exchange Commission, Timothy J. Knapp (https://www.bizjournals.com/houston/search/results?q=Timothy%20J.%20Knapp)previously held those roles from September 2017 until at least early August 2018.

"Victoria's extensive experience in mergers and acquisitions, market transactions and integrations will be an asset to Bristow as we emerge from our financial restructuring and look to address some of the industry's biggest challenges like market consolidation, diversification and market oversupply," L. Don Miller (https://www.bizjournals.com/houston/search/results?q=L.%20Don%20Miller), president and CEO of Bristow, said in the release.

The change comes at a challenging time for Bristow, though the company has been making progress in some areas. The company listed total assets of $2.86 billion and total debts of nearly $1.89 billion, as well as between 1,000 and 5,000 creditors, when it filed for Chapter 11 bankruptcy protection in May. The New York Stock Exchange began the process to delist Bristow's common stock just days later (https://www.bizjournals.com/houston/news/2019/05/17/struggling-houston-based-helicopter-co-won-t.html).

When the Chapter 11 filing was announced, Bristow said it had entered into a restructuring support agreement with “the overwhelming majority” of the parent company’s senior secured noteholders. On June 28, the company announced it entered into (http://ir.bristowgroup.com/news-releases/news-release-details/bristow-group-enters-new-restructuring-support-agreement-and) an amended and restated agreement with certain secured and unsecured noteholders, who have also reached an updated agreement to fund a new $150 million debtor-in-possession facility. Both agreements are subject to the approval of the bankruptcy court.

"We have successfully brought together holders of both our secured notes and our unsecured notes to achieve a meaningful milestone in our reorganization, and one that positions Bristow for a timely emergence from Chapter 11," Miller said in the June 28 press release. "Upon completion of this recapitalization, we will have a much stronger balance sheet with significantly lower debt levels and improved liquidity."

However, Bristow is also involved in securities litigation and other legal matters, the company recently disclosed in some financial reports filed with the SEC. One complaint filed on June 9 with the Delaware District Court alleges that Bristow executives, board directors and former executives acted in concert with one another to allow “a course of conduct by omission and commission that was designed to and did mislead the investment public,” according to the original complaint. Plaintiffs allege that a number of statements from Bristow in press releases and public filings were materially false. The complaint goes on to claim that the director defendants “either knew or should have known of the false and misleading statements that were issued on [Bristow’s] behalf and took no steps in a good faith effort to prevent or remedy that situation.”

The complaint also alleges that Bristow's board of director defendants wasted corporate assets by, among other actions, paying excessive compensation, bonuses, termination payments and awarding self-interested stock options to certain executive officers and directors. On May 3, Bristow issued over $2 million in executive retention payments to nine employees (https://www.bizjournals.com/houston/news/2019/05/08/struggling-helicopter-co-issues-millions-of.html). Miller received a retention payment of $945,000, according to a May 7 SEC filing.

An activist investor initiated a proxy battle in April over similar issues (https://www.bizjournals.com/houston/news/2019/04/26/houston-helicopter-co-faces-proxy-battle-may.html). Wisconsin-based Global Value Investment Corp., an investment research and advisory firm and the beneficial owner of 245,940 shares of Bristow’s common stock, nominated four candidates to Bristow’s board of directors and called for the immediate resignation of four current board members.

In a public letter, GVIC listed many issues of concern, including Miller’s promotion from CFO to CEO on March 1. GVIC’s letter claims Bristow’s debt grew 53.4 percent during Miller’s tenure as CFO, which also included the planned $560 million acquisition of Oregon-based Columbia Helicopters Inc., which was called off in February (https://www.bizjournals.com/houston/news/2019/02/11/houston-based-helicopter-company-s-560m.html).

Additionally, GVIC said it was concerned about the company's "inability to remedy its previously reported material weakness in internal controls over financial reporting, yet another delay in filing the Form 10-Q for the period ended Dec. 31, 2018, and the decision to delay an interest payment" that was due in April (https://www.bizjournals.com/houston/news/2019/04/16/houston-helicopter-co-delays-debt-payment.html).

Since GVIC's April letter, Bristow has filed some of the overdue financial reports with the SEC (http://ir.bristowgroup.com/news-releases/news-release-details/bristow-provides-update-status-sec-filings). However, in a June 17 filing with the SEC (https://www.sec.gov/Archives/edgar/data/73887/000119312519174784/d737014dnt10k.htm), Bristow said that it would be unable to file its annual report for the fiscal year ended March 31, 2019. The company intends to file its most recent annual report “as soon as practicable” after a July 10 bankruptcy court hearing to retain KPMG LLP as Bristow’s independent auditor.

Meanwhile, Bristow announced in a May 31 press release that (http://ir.bristowgroup.com/news-releases/news-release-details/bristow-secures-contract-bp-plc) it had signed a five-year contract with British energy giant BP PLC (NYSE: BP) to support its North Sea operations. Bristow will service the region through bases in Aberdeen and Sumburgh, Scotland, according to the press release. That contract commenced on May 13.

For the bankruptcy process, Baker Botts LLP and Wachtell, Lipton, Rosen & Katz are serving as Bristow's legal counsel, and Alvarez & Marsal is serving as the company's restructuring adviser. Houlihan Lokey is serving as financial adviser to Bristow.

Davis Polk & Wardwell LLP is serving as legal counsel and PJT Partners is serving as financial adviser to certain holders of the secured notes. Kirkland & Ellis LLP is serving as legal counsel to certain holders of the unsecured notes, and Ducera Partners LLC and Seabury Corporate Advisors LLC are serving as financial advisers to those noteholders.

rotor-rooter

30th Jul 2019, 15:15

Sometimes, the glitches in a seemingly great plan come from the most unlikely places. https://www.bloomberg.com/news/articles/2019-07-29/helicopter-bankruptcy-highlights-surprise-medical-bill-backlash

PoliticsHelicopter Bankruptcy Highlights Surprise Medical Bill BacklashBy
Jeremy Hill (https://www.bloomberg.com/authors/ATsVYBQT7rw/jeremy-hill) July 29, 2019, 9:44 AM PDT

Consumers suing PHI over large bills oppose bankruptcy plan

Health care issue is an instance of rare bipartisan support

PHIIQ (https://www.bloomberg.com/quote/PHIIQ:US?in_source=blens) PHI INC-VOTING (https://www.bloomberg.com/quote/PHIIQ:US?in_source=blens) 0.42 (https://www.bloomberg.com/quote/PHIIQ:US?in_source=blens) USD (https://www.bloomberg.com/quote/PHIIQ:US?in_source=blens) -0.05-10.64% (https://www.bloomberg.com/quote/PHIIQ:US?in_source=blens)

The bankruptcy of helicopter operator PHI Inc. (https://www.bloomberg.com/quote/PHIIQ:US) has transported the contentious issue of surprise health care bills to the steps of federal court. Judge Harlin Dewayne Hale on Tuesday will weigh objections to PHI’s plan to exit Chapter 11 protection. Among them is a challenge by a group of consumers suing PHI’s air ambulance division over its billing practices. If their lawsuit is successful, the bankruptcy plan won’t work, they said in court papers. The objection highlights the mounting backlash over surprise billing -- when patients are unwittingly billed huge amounts for care not covered by insurance. Surprise billing is common in emergency services scenarios like ground ambulance rides or anesthesiology -- situations where consumers don’t have much ability to haggle over prices because they are injured or unconscious, for example.Bipartisan IssueThe issue has already reached the other branches of government. In an era of political divisiveness, a bill to curb the practice has received rare bipartisan support (https://www.bloomberg.com/news/terminal/PV7HVV6S9728) in Congress, while President Donald Trump this year called for (https://www.whitehouse.gov/briefings-statements/remarks-president-trump-ending-surprise-medical-billing/) an end to surprise bills. “This is kind of the one clear area of agreement between the two parties,” said Loren Adler (https://healthpolicy.usc.edu/author/loren-adler/), associate director at USC Brookings Schaeffer Initiative for Health Policy. “There is a sort of fundamental market failure.” Lafayette, Louisiana-based PHI said in court papers that no credible allegation has been made that PHI owes the consumers money, but instead the consumers owe PHI. The patients “simply complain that they were charged too much” and rely on mischaracterized testimony to make their point. PHI wants Hale to overrule the objection.

A representative for PHI did not immediately provide a comment.Big BillsPHI makes more than half its money shuttling crews to offshore oil platforms in the Gulf of Mexico and other locations, but it also offers emergency medical transportation. A group of consumers allege the company’s air ambulance division didn’t disclose prices before flying them to hospitals, then stuck them with crushing bills, according to a class-action suit in Arizona. The lead plaintiff in the suit, a woman named Christina Wray, says in 2015 she was charged more than $57,000 for a flight from Taos, New Mexico to Albuquerque after she and her unborn child were exposed to carbon monoxide. Her insurance covered only about $5,000. PHI offered a discount of $15,665 if the payment was made within 30 days and Wray gave a counter-offer for a total payment of $12,000. After a few extensions, the two parties didn’t agree on a reduced price and PHI reinstated the full bill.Plan FeasibilityThe patients want the Arizona court to weigh in on their legal obligation, if any, to pay money billed by PHI. The company’s current billing practices are baked into future revenue assumptions in its bankruptcy plan, and a successful lawsuit could destroy those underpinnings, the consumers say in their federal court objection. What’s more, not everyone who was potentially overcharged was notified of the bankruptcy, the consumers’ objection says, and confirming the plan could wipe out their own claims against PHI if they win the class action suit. “Debtors purposefully chose not to give notice to a huge group -- a group that they will seek to overcharge in the future to fund their plan,” attorneys for Wray and others wrote in the objection. “A deliberate choice to deny notice to a large, well-known group with ongoing disputed claims should preclude approval of the plan.” PHI isn’t required to notify all of its air medical customers of its bankruptcy, even in light of potential future claims, attorneys for PHI wrote in their reply. PHI said it notified the attorneys for the consumers bringing the suit.Messy CaseConsumers aren’t the only ones opposing the plan. The Securities and Exchange Commission also wants to block it, saying in court papers that the plan would wrongly protect third parties from future legal action, and the U.S. Trustee -- the federal bankruptcy watchdog -- objects on similar grounds. Objections to third party releases are common in large Chapter 11 cases, though, and they rarely stop confirmation, Bloomberg Intelligence analyst Phil Brendel said in an interview. Hale has presided over the case since it was filed in March. Its twists and turns have included dissent (https://www.bloomberg.com/news/articles/2019-04-28/helicopter-bondholders-cry-foul-before-bankruptcy-court-showdown) from creditors, mediation to resolve that friction and the resignation of longtime Chief Executive Officer Al A. Gonsoulin, who agreed to retire (https://www.bloomberg.com/news/articles/2019-06-05/phi-nearing-deal-with-creditors-lawyers-tell-bankruptcy-judge).

The case is: PHI Inc., 19-30923, U.S. Bankruptcy Court, Northern District of Texas (Dallas).

rotor-rooter

12th Aug 2019, 16:11

Airnorth Sale

https://www.afr.com/street-talk/auction-underway-for-bankrupt-bristow-group-s-australian-airline-20190805-p52dulAuction underway for bankrupt Bristow Group's Australian airlineSarah Thompson (https://www.afr.com/by/sarah-thompson-j7ger) andAnthony Macdonald (https://www.afr.com/by/anthony-macdonald-j7gcx)Aug 5, 2019 — 9.32pm
Save

ShareThere's further shake-up in Australia's aviation industry.

Regional airline operator Airnorth, which operates flights across Western Australia, Queensland and the Northern Territory, is up for sale with first round bids due this week. Airnorth's owner, US-based Bristow Group, has had boutique corporate adviser Allier Capital pitching the business to potential buyers in Australia and offshore in recent weeks, spruiking its $100 million or so a year revenue and potential to be part of a bigger network. Perhaps the most logical acquirer is ASX-listed independent regional airline Regional Express Holdings Ltd, which is considering a move into the Northern Territory.

Sources said Regional Express had approached Airnorth about a deal late last year, but has since moved on. Another potential buyer is UK-based Cobham Group, which owns the country's third largest aviation business Cobham Aviation Services. Interestingly, Cobham has bankered up and is considering a sale of its own Australian arm. However it is also understood to be mulling a bid for Airnorth and combining it with its own business. [Cobham has hired Bank of America Merrill Lynch's local team, as Street Talk revealed last week.] (https://www.afr.com/street-talk/cobham-bankers-up-for-australian-aviation-unit-sale-20190801-p52csw)

There are also believed to be a handful of financial investors circling Airnorth, who are likely to consider Airnorth as a platform to a bigger move into the Australian skies. Bids are believed to be due this week with a second round slated to commence in the coming fortnight. The auction comes soon after Airnorth's owner, Houston-based Bristow Group, entered chapter 11 bankruptcy in the United States in May. It is understood prospective acquirers have been told the Australian business is ringfenced and its auction is slated to proceed as planned.

When Bristow last reported earnings for the quarter ended September 30, 2018, it said Airnorth recorded $47 million operating revenue and a $3 million loss in terms of adjusted EBITDA.

rotor-rooter

11th Sep 2019, 16:56

PHI quietly emerged from Chapter 11 Bankruptcy last week, after a quite amazing journey through the process, resulting in the creditors owning 100% of the restructured organisation. It will be interesting to see how the future develops in a market still struggling with reduced demand, low pricing, overcapacity and surplus modern helicopters, coupled to a competitive marketplace filled with Operators with reduced debt loads and new management, operating and business strategies. It will be interesting to see how the Operators move forward individually, or whether additional consolidation or further reduction in Operators will actually occur in the near future.

It's a quite remarkable evolution from the environment of five years ago.

https://www.houmatoday.com/news/20190910/phi-emerges-from-chapter-11-bankruptcyPHI emerges from Chapter 11 bankruptcyBy Adam Daigle / The Advocate (Baton Rouge)Posted Sep 10, 2019 at 7:19 PM

Lafayette-based helicopter transport company PHI Inc. has emerged from Chapter 11 bankruptcy and reduced its debt by $500 million.

The company, which locally operates bases at the Houma-Terrebonne Airport and at Port Fourchon, completed its debt restructuring process after first filing March 14 in a Texas court and implementing a reorganization plan. PHI got federal approval of its reorganization last month, which included CEO and board chairman Al Gonsoulin retiring from the company and being replaced with COO Lance Bospflug and PHI’s unsecured creditors owning 100% of the company’s equity.

PHI had reported a $11.5 million loss in the third quarter of 2018 following months of a slumping oil and gas industry.

“Our ability to successfully emerge from bankruptcy less than six months after our Chapter 11 filings and strengthen our balance sheet while maintaining and continuing to expand our safety and service commitments is a testament to the hard work of our talented employees and the strength of our relationships with our customers and partners,” Bospflug said. “We have now reached all of the key goals that we set for ourselves at the beginning of this process, including a more sustainable debt structure and a stronger balance sheet.

“However, this milestone is just the beginning of what we plan to achieve moving forward. We have ambitious plans for our company to support not only our customers and the industries we serve but also to support our workforce, one of the most highly skilled and committed workforces in the aviation services industry.”

PHI’s equity is subject to the issuance of warrants to current equity holders and future dilution. It also closed a $225 million new five-year term loan and received new equity capital from former unsecured creditors.

“I am honored with the responsibility to lead this storied company forward,” Bospflug said. “On behalf of the board of directors and the entire PHI team, I want to thank Al Gonsoulin for his many years of dedicated service and important contributions to so many in our business. PHI has been a leader in aviation and continues to be recognized as being at the forefront of safety and operations globally.”

Its headquarters, 2001 SE Evangeline Thruway, is used to shuttle people and equipment to and from offshore drilling platforms in the Gulf of Mexico and foreign countries. Customers include Shell, BP, ExxonMobil and ConocoPhillips, among others, according to filings with the U.S. Securities and Exchange Commission.

PHI employs 2,207 companywide.

helicrazi

11th Sep 2019, 19:04

Over capacity, new management, new strategies blah blah blah

The biggest crisis in this industry is the one being ignored - the lack of pilots, lack of new pilots entering the industry and pilots leaving for fixed wing or retiring.

Its all very well turning these companies around but there is a lack of pilots!!! Urgent investment needed. However these days they are more likely to invest in HR instead :ugh: :mad:

ApolloHeli

11th Sep 2019, 19:54

helicrazi

11th Sep 2019, 20:00

As someone soon to be at the "ab initio" stage of CPL(H)/IR could you please point me in the vague direction where pilots are lacking?

You will get a type rating as a new FO on the north sea at the moment, also other job adverts for FOs being advertised without the requirement of a type rating.

Bristow are offering an IR sponsorship that may be of interest to you.

Lots of onshore jobs have been vacant for a very long time, however as an ab initio these wont be suitable

ApolloHeli

11th Sep 2019, 20:04

You will get a type rating as a new FO on the north sea at the moment, also other job adverts for FOs being advertised without the requirement of a type rating.

Bristow are offering an IR sponsorship that may be of interest to you.

Lots of onshore jobs have been vacant for a very long time, however as an ab initio these wont be suitable

I've seen the IR sponsorship but sadly I'm about two months late for that. Aside from an S92 FO position that has been advertised on Bristow's "Jobs" page since much earlier this year, I don't see any more positions being up for grabs. I'm fine with covering my own IR(H) costs, as long as I know where to send my applications to when it's done in Jan/Feb. Might not be the right thread for it but would be nice to know which bases/operators are happy to consider ab-initio FOs

helicrazi

11th Sep 2019, 20:19

PM sent apollo

JulieAndrews

13th Sep 2019, 08:29

O&G Offshore granting more and more waivers to cater for lack of suitable ‘ab-initio’ applicants

DOUBLE BOGEY

13th Sep 2019, 13:02

How can a company that recently exited Chapter 11 be in such a position already after such a short period of time? Something seriously seriously wrong in the helicopter services world at the moment. Are the big oil companies pushing far too hard now?

Because they are generally run by self-serving, greedy, backstabbing incompetents who have proved time and again that they are completely incapable of balancing a budget without sticking their fat bonuses at the top of the spreadsheet. Just look at the bonus announcements made recently at Bristow's as they re-structured. If you are walking away with millions, and you started as scum, what do you care about the devastating mess you leave behind.

Chapter 11 has just provided another tool for these people to generate more bonuses as the people doing the real work and taking all the real risks suffer through endless rounds of redundancy.

There, now I feel better with that off my chest.

DB

ApolloHeli

13th Sep 2019, 13:19

O&G Offshore granting more and more waivers to cater for lack of suitable ‘ab-initio’ applicants
Can you elaborate on what you mean by "waivers"?

malabo

13th Sep 2019, 14:46

Mitchaa, yep, bit of a “Hunger Games” parallel, with Dallas being the “Capitol” to the other districts of Panem. Don’t know what inside rumours you have but there are still vacancies advertised for the Dallas office. Flight Operations now run by Supply Chain. Dallas was chosen as a First Reserve strategy to bring Dobbin’s questionable Canadian public company into an MBA-run American airline model. Take it private, tinker with the internals, then flip it back in an IPO for huge profit, and get out. Timing was bad.

JulieAndrews

15th Sep 2019, 22:31

AH
Maybe ‘waiver’ was the wrong word.
The customer sets the minimum flying experience requirements for the crews they want on contract for their O&G flying - after all, they are paying.
Regardless of total hours there was a general minimum requirement of 500-hrs multi-engine for the co-Pilot.
Makes sense I suppose - the more the merrier?
There is the facility to accept 250-hrs ME but a program of Line Training and mitigation had to be in place to counter the lack of ME time. Not all operators are equal - some have training departments used to such programs, others do not.
It wasn’t often that this ‘facility’ was drawn upon but operators are now having to use every ‘trick’ in the book to attract suitable pilot material to fill the cockpits.

Bravo73

18th Sep 2019, 19:39

As someone soon to be at the "ab initio" stage of CPL(H)/IR could you please point me in the vague direction where pilots are lacking?

Babcock Blackpool for starters:

https://jobs.babcockinternational.com/Babcock/job/Aberdeen-Co-Pilot-Aber-AB21-0LQ/556860501/

industry insider

19th Sep 2019, 00:09

I wonder what this will mean for the helicopter operation?

https://www.theage.com.au/business/companies/exxonmobil-puts-victorian-oil-and-gas-assets-up-for-sale-20190918-p52snb.html

bigglesbutler

19th Sep 2019, 02:01

Good question, in the short term probably not a lot and it is likely to take years to finish the selling process.

Nescafe

19th Sep 2019, 02:15

I wonder what this will mean for the helicopter operation?

I know you shouldn’t answer a question with another question, but how many oil and gas companies operate their own helicopter squadron?

212man

19th Sep 2019, 07:14

I know you shouldn’t answer a question with another question, but how many oil and gas companies operate their own helicopter squadron?

Not sure anymore. Connoco Phillips used to have their own, and still has a FW department I think. The obvious well known one is Brunei Shell - 2 S92 pax, 2 AW139 pax and 1 S92 SAR

gulliBell

19th Sep 2019, 09:30

..how many oil and gas companies operate their own helicopter squadron?

The two big players are Saudi Aramco and Esso Australia. Both have owned and maintained their own helicopter fleets for many years. Only branching out to contractor crews to supplement their own direct hire crews.

nowherespecial

19th Sep 2019, 11:45

Don't Chevron have a financial stake in the operators in Angola?

212man

19th Sep 2019, 11:58

The two big players are Saudi Aramco and Esso Australia. Both have owned and maintained their own helicopter fleets for many years. Only branching out to contractor crews to supplement their own direct hire crews.

good point about Aramco, but I guess he knew about Esso (XOM) which is what prompted the question.

Don't Chevron have a financial stake in the operators in Angola?

I thought Chevron stopped flying in Angola, and resorted to boats, following their fatal accident 3 years ago? Maybe not.

industry insider

19th Sep 2019, 12:05

Chevron in the GOM operates it own fleet of AW139s I believe. Chevron Angola (via its part ownership in Heli Malongo) is still flying. Total uses boats.

gulliBell

19th Sep 2019, 13:36

good point about Aramco, but I guess he knew about Esso (XOM) which is what prompted the question.

There would easily be a million+ flight hours combined between those two helicopter owner/operator offshore oil companies....Esso Australia has never had a helicopter accident (touch wood!), Saudi Aramco has had one major fatal that I recall. That is a remarkable safety record when compared to the accident rate of the major offshore helicopter contractors. I'm not sure what conclusions can be drawn about that, but the statistics might suggest oil companies owning/operating their own helicopters has certain business advantages.

rotor-rooter

5th Aug 2020, 16:59

There have been many changes to the Industry since this post started, all more than adequately covered elsewhere, each deserving detailed discussion and analysis. Two recent stories, however, illustrate the systemic collapse of the valuations and demand for assets that still haven't reached their bottom, or ended in a viable transfer of ownership to a new entity. The last discussions of the future of Milestone and even the greater GECAS fleet, highlighted the impaired asset value, and I would hate to think what any of those numbers look like today, in either the Airline or Helicopter business. This announcement last week with the write-down of assets aligns very closely with the previous negotiation to sell the Organization and the interested parties' valuation of the assets. I'm not sure if this action is the portent of a sale, but it potentially seems quite possible.
https://www.ainonline.com/aviation-news/general-aviation/2020-07-31/gecas-slashes-milestones-value-729mGECAS Slashes Milestone's Value by $729Mby Mark Huber (https://www.ainonline.com/mark-huber)
- July 31, 2020, 7:58 AMThe continuing decimation of the depressed offshore helicopter market writ large anew earlier this week when GECAS wrote down the value of its Milestone Aviation helicopter leasing unit by $729 million. Milestone holds the world’s largest fleet of Sikorsky S-92 heavy helicopters, used primarily in support of the offshore energy market.

The write-down was revealed this week in GECAS parent GE’s second-quarter 2020 10Q SEC filing in the form of a goodwill impairment. It represents a 41 percent devaluation of the $1.775 billion GECAS paid to acquire Milestone in 2015.

Milestone was founded by former NetJets chief Richard Santulli in 2010 with an initial capitalization of $500 million and based in Dublin, Ireland. It would go on to draw substantial investment from global financial powerhouses, including Lloyds, Barclays, and Lombard, the asset finance division of the Royal Bank of Scotland. Milestone built one of the world’s largest helicopter lease fleets that over the course of its first five years grew to 168 aircraft valued at $2.8 billion. It was quickly joined in the market space by a variety of new competitors, including Waypoint Leasing, LCI Aviation, Lobo Leasing, and Macquarie Rotorcraft Leasing.

The fallout from the 2008 recession and tumbling oil prices has had a lasting overhang on the offshore helicopter business, triggering a crescendo of bankruptcies and consolidations among operators and lessors in recent years.

https://www.ainonline.com/aviation-news/general-aviation/2020-08-03/one-five-s-92-helicopters-parkedOne in Five S-92 Helicopters Parkedby Mark Huber (https://www.ainonline.com/mark-huber)
- August 3, 2020, 10:32 AMWhile the offshore helicopter market is showing signs of recovery, 39 Sikorsky S-92s, comprising 19 percent of the global market, remain parked. Among the active fleet, flying hours are down 27 percent. Those are among the findings from the most recent “S-92 Fleet Census” from Air & Sea Analytics.

The report notes that offshore helicopter services companies Babcock, Bristow, CHC, and Lider are returning aircraft to lessors against the backdrop of one-quarter of the world’s mobile offshore oil rigs being scrapped since 2015. Nevertheless, Air & Sea Analytics director Steve Robertson said, “Relative to other [oil field services] segments, we’d argue it’s [the S-92] one of the best performing over the last 12 months.” But he acknowledged that many owners and operators are “having a rough time.” The largest concentration of based S-92s continues to be in the UK, with 41, but of that number only 29 are active.

Nevertheless, glimmers of hope remain. GECAS helicopter leasing unit Milestone Aviation is adding to its S-92 fleet, already the world’s largest, and finding placements for them. The overall count of heavies and super-mediums has increased slightly, from 214 to 224, a function of increased deliveries of the latter to offshore operators. The report found that “super-medium units continue to be delivered and find work in the market.” And at least two operators, Cougar and Chevron, are increasing their super-medium fleet size.

212man

6th Aug 2020, 14:13

More bad news: https://helihub.com/2020/08/06/bristow-to-close-two-lousiana-bases-with-350-job-losses-claims-union/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+HelihubNews+%28HeliHub.com+%C2%BB+Daily +News+Update%29

rotor-rooter

14th Oct 2020, 19:10

This is an interesting article, as it demonstrates the strategies that a business might utilize in a fight to grow market share in a shrinking market, put a Competitor out of business, or drive further consolidation through the acquisition of Babcock by an Organization even more desperate to remain in business than Babcock's stated goal of getting out of it. It is always worth considering that having a contract and operating it at a loss may be a better (cheaper) option than owning the assets and infrastucture and continuing to pay the cost of maintaining, insuring, and staffing it, with no revenue generation. This may trigger the next consolidation round, as the simplest mechanism to maintain pricing, is to reduce excess capacity and limit the Competition in the marketplace. It may be too late to recover the pricing in the short term, but just still being in business may be the ultimate survival goal of all the offshore operators. It's really starting to have major impacts now, beyond all the incredible things that have already happened in the last couple of years, and the almost unbelievable things that have happened so far this year. https://www.energyvoice.com/oilandgas/north-sea/271558/babcock-total-helicopter-contract/Babcock begins Total helicopter contract after rivals criticised ‘unsustainable pricing’Babcock has started a North Sea helicopter contract with Total which rival CHC criticised as “unsustainable pricing”.by Allister Thomas (https://www.energyvoice.com/author/allisterthomas/)
14/10/2020, 12:01 am
© Babcockhttps://wpcluster.dctdigital.com/energyvoice/wp-content/uploads/sites/4/2020/10/babcock-818x564.jpg Babcock has started a North Sea helicopter contract with Total which rival CHC criticised as “unsustainable pricing”.

In August, Babcock won (https://www.linkedin.com/posts/bigaviation_great-news-from-our-teams-in-the-uk-and-denmark-activity-6696023483958231040-Ehw-/) the long-term contract from CHC to transport Total workers to its central North Sea platforms.

The US helicopter firm took a thinly-veiled swipe (https://www.energyvoice.com/oilandgas/north-sea/257017/chc-helicopter-safety-total-oil/) at Total over loss of the work, saying “unsustainable pricing, will ultimately see an end to future industry investment in technology, safety improvements and the next generation of engineers and pilots.”

Babcock has now started flights using its fleet of S-92 helicopters, with over a hundred men and women having safely been flown offshore in the first week.

Contract performance manager Michelle Innes said: “It’s great to see this contract get underway smoothly and efficiently. We’re looking forward to continuing to work with Total for years to come.”

Babcock is an established helicopter operator and Total already has first-hand experience of working with the company in the UK North Sea.

Flights to the Culzean and Gryphon fields are currently provided by Babcock under a separate agreement. Total has operated both fields since its acquisition of Maersk Oil in 2018.

Babcock will begin another contract to transport Total workers in Denmark in January, which has also been subject to criticism (https://www.energyvoice.com/oilandgas/north-sea/258334/nhv-babcock-total/).

NHV, which lost out on the Danish deal, said in August that Babcock and Total were engaging “in a race to the bottom”.

Despite not having a presence in Denmark, Babcock undercut NHV in its bid, including the promise of new aircraft.

NHV CEO Steffan Bay said: “What I can say is that Total got what they wanted, even cheaper rates than they already had.

“Similar to CHC we had to give concessions to Total in the past, so it was not a very profitable contract for us anyway, hence the surprise that Babcock could perform it at even lower rates.”

Babcock did not respond to either CHC or NHV’s remarks.

212_Nightdipper

14th Oct 2020, 19:53

[QUOTE

NHV, which lost out on the Danish deal, said in August that Babcock and Total were engaging “in a race to the bottom”.

Despite not having a presence in Denmark, Babcock undercut NHV in its bid, including the promise of new aircraft.

NHV CEO Steffan Bay said: “What I can say is that Total got what they wanted, even cheaper rates than they already had.

“Similar to CHC we had to give concessions to Total in the past, so it was not a very profitable contract for us anyway, hence the surprise that Babcock could perform it at even lower rates.”

Babcock did not respond to either CHC or NHV’s remarks.[/QUOTE]

What REALLY amuses me is that the ones who actually initiated the race to the bottom in the North Sea running contracts at a loss (ie Den Helder with Wintershall for example) now are criticizing the competitors.....go figure......

rotor-rooter

10th Feb 2021, 17:24

With the Bristow financials released last week, they don't paint a particularly rosy picture and in fact, look very similar to the information that was coming from the pre-merger Bristow. The stark realities of how much cash and assets are left and how fast they are burning through it, reveals that little has changed in the realm of business overhead, and the realities of a finite survival strategy which is now pretty much "all-in". It's a very challenging time for the entire O&G industry, which coupled with Covid, makes for an extremely challenging environment just to survive. Who's going to be next to Merge?

https://www.bristowgroup.com/investors/news-events/press-releases/detail/470/bristow-group-reports-third-quarter-fiscal-year-2021-results
https://d1io3yog0oux5.cloudfront.net/_65b3da8719dc721c679a5d2080bfec91/bristowgroup/db/808/8817/file/Bristow+Q3+FY21+Earnings+Presentation%281%29.pdf

https://www.ainonline.com/aviation-news/business-aviation/2021-02-08/bristow-sees-no-recovery-offshore-helicopters-2021Bristow Sees No Recovery for Offshore Helicopters in 2021by Mark Huber (https://www.ainonline.com/mark-huber)
- February 8, 2021, 6:37 PM
https://www.ainonline.com/sites/ainonline.com/files/styles/ain30_fullwidth_large_2x/public/uploads/2021/02/bristow_web.jpg?itok=cp_7Olc9&timestamp=1612876755 (https://www.ainonline.com/sites/ainonline.com/files/uploads/2021/02/bristow_web.jpg)Global helicopter services company Bristow Group announced a widening net loss in the fourth quarter and confirmed its intention to seek $400 million in new financing to pay down high-cost debt, some of which comes due in 2022. CEO Chris Bradshaw also said he didn’t see Bristow’s core offshore energy business improving until next year.

The new debt will be secured by 93 pledged aircraft from its fleet and “substantially all of the other tangible and intangible property assets of the company.” Debt proceeds combined with company cash will be used to repay term loans of $152 million from Macquarie Bank and $203.9 million from Apollo unit PK AirFinance, as well as $132 million in 7.75 percent senior notes due next year.

For the quarter, Bristow posted a loss of $57.1 million on operating revenues of $300.3 million, compared to a loss of $27.9 million on revenues of $295.7 million in the preceding quarter. Almost all of Bristow’s most recent quarterly losses were attributed to “impairment charges” related to the company’s investment in Canada’s Cougar Helicopters ($51.9 million) and helicopters held for sale ($1.4 million). That compared to impairment losses of $17.6 million in the preceding quarter related to inventory write-down and helicopters held for sale.

Bristow is continuing to “right-size” its aircraft inventory, disposing of five Sikorsky S-76C++ medium, two Bell B412 medium, and seven Bell B407 single-engine helicopters, in addition to one Airbus H225 simulator, for cash proceeds of $14.4 million. During the preceding quarter, the company sold 10 Airbus H225 heavy, nine S-76C++ medium, and 12 Bell 407 single-engine helicopters for cash proceeds of $40.5 million.

Despite the most recent losses, Bristow ended the calendar year with $345 million in “total liquidity” and CEO Chris Bradshaw said the company was moving in a positive direction. “The company continues to make significant integration progress following the merger of Era and Bristow in June 2020. We are pleased to announce a further increase in the amount of identified synergies to at least $50 million of annualized cost savings, of which projects representing $27 million of annualized synergies have already been completed," he said.

Bradshaw said he didn’t expect President Biden’s recent executive orders suspending new oil and gas leases on federal lands/in federal waters to have a material impact on the company as its current offshore activities are heavily weighted on supporting existing production. Offshore is not likely to increase this year, he said, but is primed for a rebound in 2022, he told stock analysts.

“For calendar 2021, we're really not counting on any broad-based significant increase above where things are today…Where we start to be more constructive on additional spending from our customer base is in 2022 and beyond. We know there needs to be another spending cycle here because today's level of underinvestment is not sustainable. It's going to result in higher commodity prices and that we'll see we think more dollars go to work in deepwater projects around the world and that should benefit our business.”

According to Bradshaw, the industry could benefit from further consolidation and continued development of offshore wind power. “We continue to believe that the industry needs and would benefit from additional consolidation," he commented. "A lot of the rationale that underpins the logic of the Bristow Era merger would apply in other combinations in different parts of the world where there is an excess amount of capacity, too much equipment, too many operators.”

With regard to offshore wind, Bradshaw called it a “strategic priority” for Bristow, particularly in Europe, and that the U.S. market would likely develop later. “We do not have any exposure in the U.S., that's because the one operating wind farm today is so close to shore that it's supported by boats, but the new wind farms that are scheduled to be developed are going to require offshore helicopter support.”