CHC Helicopter looks to take off with growing global oil and gas industry
Craig Wong Canadian Press June 30, 2005
VANCOUVER (CP) - CHC Helicopter Corp. is riding high on a thriving global oil and gas industry and looking ahead to an extensive fleet replacement program, executives told a conference call Thursday.
The company said it has a "huge list" of customers looking for bids on potential new offshore contracts, but just doesn't have enough aircraft to support them all. "The activity is continuing to increase with several requests for bids to support and existing oil and gas projects and we're also looking extensive fleet replacement programs in for example Nigeria, Brazil and in India," CEO Sylvain Allard told a conference call.
CHC said it added 15 new medium helicopters and two new heavy helicopters in the last year.
"All these aircraft are fully deployed and the fleet is still very tight. In fact, we anticipate that the impressive growth experienced last year in the last 12 months in our global operations will continue for fiscal 2006.
And CHC said it has commitments for several more helicopters and options on others this year.
"We are working with all three manufacturers right now, Sikorsky, Bell and Eurocopter to figure out line positions, how quickly we can get aircraft and how many we can get and what the prices are going to be," said chief financial officer Jo Mark Zurel.
"And depending how those negotiations work out we may buy more or less from the different manufacturers."
The Vancouver-based international helicopter services provider reported Wednesday it earned $18.8 million or 41 cents per share in its fourth quarter ended April 30. That compared with a profit of $25.4 million or 56 cents per share a year earlier.
Revenue was $226.4 million, up from $209.4 million.
For the full year, CHC earned $62.6 million or $1.37 per share on revenue of $903.3 million. That compared with a profit of $63.7 million or $1.41 per share on revenue of $720 million in its 2004 financial year.
The company expects profit margins to be improved by its decision to eliminate 180 jobs, along with improvements in fleet management, working capital management, procurement and logistics.
Zurel said the company has incurred substantial restructuring costs and there will be additional costs in fiscal 2006.
"The vast majority of the savings will be coming in the coming fiscal year. We in fact incurred some duplicate costs in fiscal 2005 because even though we had restructuring costs in letting some people go and all the consulting and legal and tax work and relocations costs.
As part of its restructuring, CHC created Heli-One as it combined its helicopter support subsidiaries and divisions under one banner.
Heli-One combines Astec Helicopter Services, Multifabs Survival, AeroTurbine Support and Overhaul International and is expected to leasing and support services to civilian and military helicopter operators worldwide.
The company also moved its corporate headquarters from St. John's, Nfld., to Vancouver.
CHC Helicopter is the world's largest provider of helicopter services to the global offshore oil and gas industry, with aircraft operating in more than 30 countries and about 3,400 employees worldwide.