What's happening in CHC?
Bristow for CHC??
Bristow Eyeing Up to $1 Billion in Aircraft M&A as Oil Drops (1)(Updates with share price in fifth paragraph.)
By David Wethe
(Bloomberg) -- Bristow Group Inc., the largest helicopter company that ferries oil workers to rigs and platforms offshore, is willing to spend as much as $1 billion on acquisitions, seizing on the crude market crash to expand its fleet.
Next year will be “very good,” partly because of the chance to do more mergers and acquisitions, Chief Executive Officer Jonathan Baliff, 51, said in an interview Wednesday at his headquarters in Houston. “There are a lot of M&A opportunities that are presenting themselves now and could deliver great results in calendar year 16, fiscal year 17.”
During the past year, the company has begun to acquire stakes in small regional airlines. It has a market value of $2.18 billion and had $204.3 million in cash and cash equivalents at the end of last year. Bristow’s biggest deal so far was a 2012 agreement to buy a $250 million stake in the Canadian company Cougar Helicopters.
Its largest business is transporting oil workers from shore bases to offshore production platforms in places such as the Gulf of Mexico, the North Sea and waters off the coast of Brazil. The company’s fleet accounts for about a third of the global supply of aircraft serving the oil industry.
Bristow rose 4.1 percent to $62.90 at the close in New York. The shares, which have 5 buy ratings from analysts, 3 holds and 1 sell, have dropped 14 percent in the past year.
Rescue Business
It’s also expanding beyond the oil industry to do search-and-rescue work for the U.K. government. Transporting oil workers generates margins in the 20 percent range while search and rescue leads to margins in the low 40 percent range, Baliff said.
Bristow expects to defer capital spending next year for new aircraft and instead put that toward a dividend boost and potential additional share buybacks. The company plans to continue doubling its dividend over three to five years, he said.
“We think fiscal year 2017 is going to be a pretty good year, independent of the oil and gas market recovering significantly,” said Baliff, who took over as CEO the month after oil prices crested last year.
By David Wethe
(Bloomberg) -- Bristow Group Inc., the largest helicopter company that ferries oil workers to rigs and platforms offshore, is willing to spend as much as $1 billion on acquisitions, seizing on the crude market crash to expand its fleet.
Next year will be “very good,” partly because of the chance to do more mergers and acquisitions, Chief Executive Officer Jonathan Baliff, 51, said in an interview Wednesday at his headquarters in Houston. “There are a lot of M&A opportunities that are presenting themselves now and could deliver great results in calendar year 16, fiscal year 17.”
During the past year, the company has begun to acquire stakes in small regional airlines. It has a market value of $2.18 billion and had $204.3 million in cash and cash equivalents at the end of last year. Bristow’s biggest deal so far was a 2012 agreement to buy a $250 million stake in the Canadian company Cougar Helicopters.
Its largest business is transporting oil workers from shore bases to offshore production platforms in places such as the Gulf of Mexico, the North Sea and waters off the coast of Brazil. The company’s fleet accounts for about a third of the global supply of aircraft serving the oil industry.
Bristow rose 4.1 percent to $62.90 at the close in New York. The shares, which have 5 buy ratings from analysts, 3 holds and 1 sell, have dropped 14 percent in the past year.
Rescue Business
It’s also expanding beyond the oil industry to do search-and-rescue work for the U.K. government. Transporting oil workers generates margins in the 20 percent range while search and rescue leads to margins in the low 40 percent range, Baliff said.
Bristow expects to defer capital spending next year for new aircraft and instead put that toward a dividend boost and potential additional share buybacks. The company plans to continue doubling its dividend over three to five years, he said.
“We think fiscal year 2017 is going to be a pretty good year, independent of the oil and gas market recovering significantly,” said Baliff, who took over as CEO the month after oil prices crested last year.
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Toronto, March 25, 2015 -- Moody's Investors Service affirmed all ratings of CHC Group Ltd ("CHC") and its subsidiary, CHC Helicopter S.A. ("CHC S.A."). The ratings consist of CHC's B2 Corporate Family Rating (CFR), B2-PD Probability of Default Rating (PDR), and SGL-3 Speculative Grade Liquidity rating (SGL) and CHC S.A.'s B1 senior secured and Caa1 senior unsecured ratings. The rating outlooks for CHC and CHC S.A. have been changed to negative from positive.
RATINGS RATIONALE
"We changed CHC's outlook to negative as we expect the company's cash flows will deteriorate over the next year as a result of weak oil prices", said Darren Kirk, Moody's Vice President and Senior Credit Officer.
RATINGS RATIONALE
"We changed CHC's outlook to negative as we expect the company's cash flows will deteriorate over the next year as a result of weak oil prices", said Darren Kirk, Moody's Vice President and Senior Credit Officer.
The fun never ends.....
The plaintiff claims that CHC Group Ltd allegedly failed to tell potential investors that one of its largest customers stopped making payments to CHC Group Ltd months before it filed a prospectus for the companys January 2014 initial public offering (IPO).
On July 10, 2014, CHC Group Ltd announced that starting in April of 2013, Petrobras stopped making payments on contracts to CHC Group and other operators of 225 [helicopters] in Brazil until overwater flights with those aircraft resumed.
The plaintiff alleges that the offering materials for the IPO contained false and/or misleading statements and omissions of material fact and therefore misled investors. More specifically, the plaintiff says that a crash of one of CHC Group Ltds aircraft in October 2012 led to a grounding of certain models of medium- and heavy-weight helicopters and that one of CHC Group Ltds biggest customers, Petroleo Brasileiro SA, or Petrobras, suspended its payments to CHC Group Ltd as a result of the grounding, but CHC Group Ltd made no mention of this in its prospectus.
The plaintiff says that, while the accident is mentioned in CHC Group Ltds filing under the Recent Developments section and the filings conclude that it is too early to determine the extent of the impact of the accident on our results of operations or financial condition based on information currently available, CHC Group Ltd allegedly knew by the time it was filing for its offering how significant the impact would be. The plaintiff says that it was not too early for CHC Group Ltd to estimate the impact of the accident, as payments from Petrobras ceased in April 2013, almost seven months before the Registration Statement was filed.
On July 10, 2014, CHC Group Ltd announced that starting in April of 2013, Petrobras stopped making payments on contracts to CHC Group and other operators of 225 [helicopters] in Brazil until overwater flights with those aircraft resumed.
The plaintiff alleges that the offering materials for the IPO contained false and/or misleading statements and omissions of material fact and therefore misled investors. More specifically, the plaintiff says that a crash of one of CHC Group Ltds aircraft in October 2012 led to a grounding of certain models of medium- and heavy-weight helicopters and that one of CHC Group Ltds biggest customers, Petroleo Brasileiro SA, or Petrobras, suspended its payments to CHC Group Ltd as a result of the grounding, but CHC Group Ltd made no mention of this in its prospectus.
The plaintiff says that, while the accident is mentioned in CHC Group Ltds filing under the Recent Developments section and the filings conclude that it is too early to determine the extent of the impact of the accident on our results of operations or financial condition based on information currently available, CHC Group Ltd allegedly knew by the time it was filing for its offering how significant the impact would be. The plaintiff says that it was not too early for CHC Group Ltd to estimate the impact of the accident, as payments from Petrobras ceased in April 2013, almost seven months before the Registration Statement was filed.
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I think its just a bunch of blah blah blah, everyone knew the 225´s were grounded for a extended period and some oil companies including Petrobras after a time suspended payments . This did not happen immediately after the grounding of the 225´s that the grounding) was lead by some operators ( including CHC) and not by OEM ( Airbus) and by Petrobras in Brazil. Petrobras after some months going into the grounding decided to suspend the payments, this does not mean they did not pay for the months they were grounded they only suspended the payments. This was all under negations by all the 225 operators in Brazil . They might have been paid after the aircraft went back into operation, but this point I cannot confirm this happened,
Sometimes you have to take some statements you read in the news with a grain of salt since there is always more to the story then is being told.
I doubt very much CHC was hiding this from the investors at all, they were up front about what this meant to revenue´s in all the announcements I read having to deal with the financial results during this period.
Sometimes you have to take some statements you read in the news with a grain of salt since there is always more to the story then is being told.
I doubt very much CHC was hiding this from the investors at all, they were up front about what this meant to revenue´s in all the announcements I read having to deal with the financial results during this period.
TW - thats one view and I suppose it starts with if you think that an investor of CHC Group filing an action in the Supreme Court of New York is merely "blah blah"...
If you are reading the same thing as me it is being suggested in the action that payments from Petrobas had stopped prior to this IPO and that it wasn't until July 10th 2014 on an earnings call that further disclosure was made.
I don't call that blah, blah and actually the colour given to all concerned vis the EC225 situation was woeful and this, along with the beaten up stock price of CHC reflects that in my opinion.
It was a total shambles at every level for a very long time. Forget the engineering or operational issues and the fact aircraft No.2 ended in the sea because of the mis-identification of the issue the communication was pitiful, being both confused and uncoordinated.
This situation affected me personally because of a friend who was physically affected by it and myself professionally.
It is not a surprise.
If you are reading the same thing as me it is being suggested in the action that payments from Petrobas had stopped prior to this IPO and that it wasn't until July 10th 2014 on an earnings call that further disclosure was made.
I don't call that blah, blah and actually the colour given to all concerned vis the EC225 situation was woeful and this, along with the beaten up stock price of CHC reflects that in my opinion.
It was a total shambles at every level for a very long time. Forget the engineering or operational issues and the fact aircraft No.2 ended in the sea because of the mis-identification of the issue the communication was pitiful, being both confused and uncoordinated.
This situation affected me personally because of a friend who was physically affected by it and myself professionally.
It is not a surprise.
You have had Bristow CEO give a timescale for back to service, later back tracked upon and then portrayed as media spin by HSSG.
You have Bristow and EADS give a conference calls (to the people that own the companies I might add - so having legal consequences) suggesting they could not give a timescale for being back in the air, then Eurocopter Aberdeen sends a press release with the June/July date (which was actually 1 day after the Bristow call).
Then CHC and Bristow can't agree when might be suitable and now you've got the RMT banging its drum. Oh and somewhere along the way EC's CEO left!
You have had a slow bleed of information over the issues of which there have been numerous and then we come to the real crux is the endless attempt to put this positive spin on everything.
You have Bristow and EADS give a conference calls (to the people that own the companies I might add - so having legal consequences) suggesting they could not give a timescale for being back in the air, then Eurocopter Aberdeen sends a press release with the June/July date (which was actually 1 day after the Bristow call).
Then CHC and Bristow can't agree when might be suitable and now you've got the RMT banging its drum. Oh and somewhere along the way EC's CEO left!
You have had a slow bleed of information over the issues of which there have been numerous and then we come to the real crux is the endless attempt to put this positive spin on everything.
Summary of CHC GROUP LTD. - Yahoo! Finance
Any original management left in this company? Interesting severance levels being paid out considering the market capitalization at today's market rates.
Any original management left in this company? Interesting severance levels being paid out considering the market capitalization at today's market rates.
Agreed malabo although sadly with these things it's likely to be a contractual payout rather than performance related. interesting times. no one left from the previous regime at SVP level in 2 months time. No commercial leadership at all at the moment either. Interesting times.
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There goes another 4 million to get rid of the last of the Amelio bandits. How this team of misfits could destroy a 60 + year old company in 5 short years is criminal.
Are they going to suffer? Of course not, only the literally thousands of hard working professionals and their families that are impacted by this gross mis-managment will suffer.
It is beyond me how this group of 3 are not sharing a jail cell.
Craig Dobbin is either laughing his ass off counting his 3 billion or clawing his way to the surface.....
Are they going to suffer? Of course not, only the literally thousands of hard working professionals and their families that are impacted by this gross mis-managment will suffer.
It is beyond me how this group of 3 are not sharing a jail cell.
Craig Dobbin is either laughing his ass off counting his 3 billion or clawing his way to the surface.....
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You know what's even worse for me.
You, Outwest, and I, from the first time we saw their slimy videos, from the first Business 101 level emails, from the first time we met them, could pretty much see them for the incompetent windbags they turned out to be.
Yet we had several years of upper middle management who enabled their schemes, never gave honest feedback to their unsuitable ideas, continually praised the competence of the Amelio team to us who struggled more and more in the field, and generally didn't manage but only bowed.
I hold them just as accountable, maybe more.
You, Outwest, and I, from the first time we saw their slimy videos, from the first Business 101 level emails, from the first time we met them, could pretty much see them for the incompetent windbags they turned out to be.
Yet we had several years of upper middle management who enabled their schemes, never gave honest feedback to their unsuitable ideas, continually praised the competence of the Amelio team to us who struggled more and more in the field, and generally didn't manage but only bowed.
I hold them just as accountable, maybe more.
outwest,
I agree - Nice to know the high ups can still be let go but the $2m pay offs make us all blink quite hard and shake our heads. If I had to pick a way to get fired, getting a $2m pay off would be one of them.
Here's hoping the new people are helicopter savvy and not the sort of people who think IT and pointless process solves all problems.
I agree - Nice to know the high ups can still be let go but the $2m pay offs make us all blink quite hard and shake our heads. If I had to pick a way to get fired, getting a $2m pay off would be one of them.
Here's hoping the new people are helicopter savvy and not the sort of people who think IT and pointless process solves all problems.
Joan has goan!
Although she is remaining to announce CHC's fiscal-2015 fourth quarter results in July.
Fessenden says he wants to thank Joan for her many contributions........
Although she is remaining to announce CHC's fiscal-2015 fourth quarter results in July.
Fessenden says he wants to thank Joan for her many contributions........
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Is CHC still salvageable, or is it too little, too late?
The owners want one thing from their management, the customers, another. They struggled during one of the biggest booms in the history of the industry, and are now fighting for their lives during yet another bust in the business.
Interesting times.
The owners want one thing from their management, the customers, another. They struggled during one of the biggest booms in the history of the industry, and are now fighting for their lives during yet another bust in the business.
Interesting times.
CHC will weather this storm and emerge a much stronger prospect. Yes they have issues at present, but Karl Fessenden is doing a good job of putting the wheels back on.
As Nowhere alludes to, the company has been hamstrung by an inept leadership team of laptop salesmen for several years and buried in process.
Now the keystone kops are gone, and there is a capable CEO in the driving seat, you can expect a great deal of positive change......
As Nowhere alludes to, the company has been hamstrung by an inept leadership team of laptop salesmen for several years and buried in process.
Now the keystone kops are gone, and there is a capable CEO in the driving seat, you can expect a great deal of positive change......
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helimutt
You're being unfair to CHC with your 139 comment. Any Global 139 pilot who can (EASA license and right to work) be assigned to that contract, probably will be. You know fine well that Europeans only make up around 20% of the CHC Global workforce.
Any problems with qualified Global staff working in the UK in the past in situations like this has always arisen from union protectionism. That's not a comment on union policies, before any argument starts, it's just a fact.
You're being unfair to CHC with your 139 comment. Any Global 139 pilot who can (EASA license and right to work) be assigned to that contract, probably will be. You know fine well that Europeans only make up around 20% of the CHC Global workforce.
Any problems with qualified Global staff working in the UK in the past in situations like this has always arisen from union protectionism. That's not a comment on union policies, before any argument starts, it's just a fact.
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Global has already had a few EASA licensed pilots filling spots in Den Helder who would otherwise have been on the unassigned list.
Current CHC policy is unassigned=laid off, so those Global EASA pilots have been able to dodge that bullet by crewing in Den Helder ( and the UK)
Current CHC policy is unassigned=laid off, so those Global EASA pilots have been able to dodge that bullet by crewing in Den Helder ( and the UK)
helimutt, you seem to have an awful lot of inside info on CHC. Care to elaborate on the CHC pilot being shot at? Where and response etc. if nothing was done, it seems a bit reckless on CHC's side.
Or perhaps you don't have all the facts?
Or perhaps you don't have all the facts?
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Two local security guards gunned down in broad daylight at company compound, all caught on multiple CCTV sources. Gunman never arrested. Fact.
Recent grenade attack at company company compound (M26 type confirmed), no injuries. Fact.
Local pilot heard by many uttering verbal death threats towards an expat pilot in the not too distant past. Same local pilot kept a firearm(s) and ammo in his room at company compound (confirmed visual sighting by witnesses). Same local pilot is no longer in the employ of TAS. Fact.
Company compound effectively unchanged security-wise, save for some cosmetic "enhancements". Fact.
Ops normal.
Recent grenade attack at company company compound (M26 type confirmed), no injuries. Fact.
Local pilot heard by many uttering verbal death threats towards an expat pilot in the not too distant past. Same local pilot kept a firearm(s) and ammo in his room at company compound (confirmed visual sighting by witnesses). Same local pilot is no longer in the employ of TAS. Fact.
Company compound effectively unchanged security-wise, save for some cosmetic "enhancements". Fact.
Ops normal.