Bristow(VTOL) - 2025 Q2 - Quarterly Results

Executive Summary & Q2 2025 Highlights Bristow Group reported strong Q2 2025 financial results, including increased revenues and net income, and raised its 2025 and 2026 Adjusted EBITDA outlook Second Quarter 2025 Financial Performance Bristow Group reported strong financial results for Q2 2025, with significant sequential increases in total revenues, net income, and Adjusted EBITDA compared to Q1 2025. The company also raised its Adjusted EBITDA outlook ranges for both 2025 and 2026 Q2 2025 Financial Performance (millions USD) | Metric | Q2 2025 (June 30, 2025) | Q1 2025 (March 31, 2025) | Change | Change (%) | | :-------------------------------- | :----------------------- | :---------------------- | :----- | :--------- | | Total revenues | $376.4 | $350.5 | +$25.9 | +7.4% | | Net income attributable to Bristow Group Inc. | $31.7 | $27.4 | +$4.3 | +15.7% | | Diluted earnings per common share | $1.07 | $0.92 | +$0.15 | +16.3% | | Adjusted EBITDA | $60.7 | $57.7 | +$3.0 | +5.2% | | Net cash provided by (used in) operating activities | $99.0 | $(0.6) | +$99.6 | nm | | Free Cash Flow | $94.5 | $(2.5) | +$97.0 | nm | | Adjusted Free Cash Flow | $95.3 | $(1.7) | +$97.0 | nm | - Bristow Group raised its 2025 Adjusted EBITDA outlook range to $240 - $260 million and its 2026 Adjusted EBITDA outlook range to $300 - $335 million[5] - The company initiated accelerated debt payments and share repurchases during the quarter[5] Management's Strategic Commentary Chris Bradshaw, President and CEO, expressed satisfaction with the strong financial results and the ability to raise guidance for 2025 and 2026. He highlighted the company's adherence to its capital allocation framework by commencing accelerated debt payments and share repurchases - CEO Chris Bradshaw stated, "We are pleased to report another quarter of strong financial results and to raise 2025 Adjusted EBITDA guidance to $240-$260 million and 2026 Adjusted EBITDA guidance to $300-$335 million"[6] - Bristow commenced accelerated debt payments and share repurchases in the current quarter, consistent with its capital allocation framework[6] Sequential Quarter Financial Results by Segment This section details Bristow Group's Q2 2025 financial performance across its Offshore Energy, Government, and Other Services segments, highlighting key revenue and operating income drivers Offshore Energy Services The Offshore Energy Services segment experienced a significant increase in revenues and operating income, driven by higher utilization and favorable foreign exchange rates across Europe, the Americas, and Africa. This growth was partially offset by increased operating expenses Offshore Energy Services Performance (thousands USD) | Metric | Q2 2025 | Q1 2025 | Favorable (Unfavorable) | Change (%) | | :------------------------ | :-------- | :-------- | :---------------------- | :--------- | | Revenues | $252,810 | $239,785 | $13,025 | 5.4% | | Operating income | $43,595 | $37,365 | $6,230 | 16.7% | | Adjusted Operating Income | $53,588 | $47,114 | $6,474 | 13.7% | | Operating income margin | 17% | 16% | +1% | | | Adjusted Operating Income margin | 21% | 20% | +1% | | - Revenue increase of $13.0 million was primarily due to higher utilization and favorable foreign exchange rates in Norway ($6.4 million), higher utilization in the U.S. ($3.7 million), and higher utilization and additional aircraft capacity in Africa ($3.0 million)[6] - Operating income increased by $6.2 million, mainly due to higher revenues, partially offset by a $5.7 million increase in operating expenses, including higher reimbursable expenses, training/travel costs, subcontractor costs, and repairs/maintenance[6] Government Services Government Services revenues increased due to new contracts and higher utilization, but the segment reported an operating loss primarily due to significantly higher operating expenses associated with new contracts and unfavorable foreign exchange impacts Government Services Performance (thousands USD) | Metric | Q2 2025 | Q1 2025 | Favorable (Unfavorable) | Change (%) | | :------------------------ | :-------- | :-------- | :---------------------- | :--------- | | Revenues | $92,499 | $85,943 | $6,556 | 7.6% | | Operating income (loss) | $(1,912) | $6,011 | $(7,923) | nm | | Adjusted Operating Income | $6,036 | $13,719 | $(7,683) | (56.0)% | | Operating income (loss) margin | (2)% | 7% | -9% | | | Adjusted Operating Income margin | 7% | 16% | -9% | | - Revenues increased by $6.6 million, mainly from the ongoing transition of the Irish Coast Guard (IRCG) contract and higher utilization in the United Kingdom Search and Rescue (UKSAR) contract[7] - The segment shifted from an operating income of $6.0 million in Q1 to an operating loss of $1.9 million in Q2, primarily due to higher subcontractor costs ($5.1 million), personnel costs ($2.8 million) for new contracts, unfavorable foreign exchange impacts ($3.0 million), and increased repairs/maintenance ($2.0 million) and fuel costs ($0.6 million)[7] Other Services The Other Services segment demonstrated strong growth in both revenues and operating income, primarily driven by seasonally higher utilization in Australia Other Services Performance (thousands USD) | Metric | Q2 2025 | Q1 2025 | Favorable (Unfavorable) | Change (%) | | :------------------------ | :-------- | :-------- | :---------------------- | :--------- | | Revenues | $31,120 | $24,802 | $6,318 | 25.5% | | Operating income (loss) | $3,443 | $(622) | $4,065 | nm | | Adjusted Operating Income | $6,188 | $2,037 | $4,151 | nm | | Operating income (loss) margin | 11% | (3)% | +14% | | | Adjusted Operating Income margin | 20% | 8% | +12% | | - Revenues increased by $6.3 million, mainly due to seasonally higher utilization in Australia ($6.0 million)[8] - Operating income improved by $4.1 million, primarily due to higher revenues, partially offset by a $1.9 million increase in operating expenses due to increased activity[8] Corporate and Consolidated Financial Items Corporate operating losses decreased significantly due to increased gains on asset disposals. Interest expense rose due to accelerated amortization of deferred financing costs, while other income increased from higher foreign exchange gains. Income tax expense more than doubled due to earnings mix and lower deductible interest expenses Corporate and Consolidated Financial Items (thousands USD) | Metric | Q2 2025 | Q1 2025 | Favorable (Unfavorable) | Change (%) | | :------------------------ | :-------- | :-------- | :---------------------- | :--------- | | Corporate Operating loss | $(2,486) | $(9,206) | $6,720 | 73.0% | | Gains (losses) on disposal of assets | $6,209 | $(558) | $6,767 | nm | | Interest expense, net | $(10,034) | $(9,490) | $(544) | (5.7)% | | Other, net | $17,577 | $11,388 | $6,189 | 54.3% | | Income tax expense | $(20,443) | $(10,183) | $(10,260) | nm | - Corporate operating losses decreased by $6.7 million primarily due to increased gains on disposal of assets[9] - Interest expense, net, increased by $0.5 million due to accelerated amortization of deferred financing costs from prepayment of principal on UKSAR Debt[10] - Other income, net, increased by $6.2 million, primarily driven by higher foreign exchange gains[10] - Income tax expense increased by $10.3 million, mainly due to the earnings mix of global operations and lower deductible business interest expenses, partially offset by deferred tax asset recognition[11] Financial Outlook and Capital Management Bristow Group updated its financial outlook for 2025 and 2026, projecting increased revenues and Adjusted EBITDA, alongside details on capital allocation and liquidity 2025 and 2026 Financial Outlook Bristow Group has raised its financial outlook for both 2025 and 2026, projecting increased total revenues, Adjusted Operating Income, and Adjusted EBITDA across all segments, reflecting confidence in future performance Financial Outlook (USD, millions) | Metric | 2025E (USD, millions) | 2026E (USD, millions) | | :-------------------------- | :-------------------- | :-------------------- | | Revenues: | | | | Offshore Energy Services | $980 - $1,030 | $1,050 - $1,130 | | Government Services | $360 - $400 | $440 - $460 | | Other Services | $120 - $130 | $130 - $150 | | Total Revenues | $1,460 - $1,560 | $1,620 - $1,740 | | Adjusted Operating Income: | | | | Offshore Energy Services | $200 - $205 | $235 - $250 | | Government Services | $40 - $50 | $75 - $85 | | Other Services | $20 - $25 | $20 - $25 | | Corporate | ($35 - $30) | ($35 - $30) | | Consolidated Adjusted Operating Income | $225 - $250 | $295 - $330 | | Adjusted EBITDA | $240 - $260 | $300 - $335 | | Cash interest | ~$45 | ~$40 | | Cash taxes | $25 - $30 | $25 - $30 | | Maintenance capital expenditures | $15 - $20 | $20 - $25 | Capital Allocation and Liquidity Bristow Group actively managed its capital during the quarter, making accelerated debt payments and repurchasing shares. The company maintained a strong liquidity position with substantial unrestricted cash and available credit - The Company made $15.3 million (£11.2 million) of accelerated principal payments on its UKSAR Debt facility[14] - Bristow repurchased 119,841 shares of common stock for $3.9 million at an average cost of $32.41 per share, with $121.1 million remaining under the $125.0 million stock repurchase program[14] Capital Activity (millions USD) | Capital Activity | Q2 2025 | Q1 2025 | | :-------------------------------- | :-------- | :-------- | | Purchases of property and equipment | $31.6 | $52.1 | | Maintenance capital expenditures | $4.5 | $1.9 | | Cash proceeds from sale of assets | $24.1 | < $0.1 | - As of June 30, 2025, total liquidity was $316.5 million, comprising $251.8 million of unrestricted cash and $64.7 million remaining availability under its asset-based revolving credit facility[16] Company Profile and Disclosures This section provides an overview of Bristow Group's business as a global vertical flight solutions provider and includes important forward-looking statement disclosures About Bristow Group Bristow Group Inc. is a leading global provider of vertical flight solutions, primarily serving offshore energy companies and government entities with a range of aviation services across three operating segments and a broad international presence - Bristow Group Inc. is the leading global provider of innovative and sustainable vertical flight solutions[19] - The company primarily provides aviation services to offshore energy companies and government entities, including personnel transportation, search and rescue (SAR), medevac, fixed-wing transportation, unmanned systems, and ad-hoc helicopter services[19] - Bristow's business is comprised of three operating segments: Offshore Energy Services, Government Services, and Other Services[19] - The company has customers in numerous countries, including Australia, Brazil, Canada, Chile, India, Ireland, the Netherlands, Nigeria, Norway, Spain, the UK, and the U.S[20] Forward-Looking Statements Disclosure This section provides a cautionary disclosure regarding forward-looking statements, emphasizing that future results may differ materially from projections due to significant known and unknown risks, uncertainties, and assumptions. Investors are advised not to place undue reliance on these statements and to consider various risk factors detailed in SEC filings - The press release includes forward-looking statements about future business, strategy, operations, financial projections, and management plans[22] - These statements involve significant known and unknown risks, uncertainties, assumptions, and other factors that may cause actual results to differ materially from any future results expressed or implied[22] - Key factors to consider include supply chain disruptions, inflation, reliance on limited manufacturers/customers, cyberattacks, compliance with financing agreements, fluctuations in oil and gas demand, foreign exchange rates, competition, political instability, and changes in laws and regulations[23] Detailed Financial Statements This section presents the condensed consolidated statements of operations, revenues and flight hours by segment, segment statements of operations, and balance sheets for Bristow Group Condensed Consolidated Statements of Operations The condensed consolidated statements of operations provide a detailed breakdown of revenues, costs, and expenses, leading to net income for Q2 2025 compared to Q1 2025, highlighting the drivers of the sequential financial performance Condensed Consolidated Statements of Operations (in thousands) | Metric (in thousands) | June 30, 2025 | March 31, 2025 | Favorable/(Unfavorable) | | :------------------------------------ | :------------ | :------------- | :---------------------- | | Total revenues | $376,429 | $350,530 | $25,899 | | Total operating expenses | $278,491 | $257,185 | $(21,306) | | General and administrative expenses | $44,375 | $43,100 | $(1,275) | | Depreciation and amortization expense | $17,312 | $16,841 | $(471) | | Total costs and expenses | $340,178 | $317,126 | $(23,052) | | Gains (losses) on disposal of assets | $6,209 | $(558) | $6,767 | | Operating income | $42,640 | $33,548 | $9,092 | | Interest income | $2,039 | $2,118 | $(79) | | Interest expense, net | $(10,034) | $(9,490) | $(544) | | Other, net | $17,577 | $11,388 | $6,189 | | Income before income taxes | $52,222 | $37,564 | $14,658 | | Income tax expense | $(20,443) | $(10,183) | $(10,260) | | Net income attributable to Bristow Group Inc. | $31,748 | $27,359 | $4,389 | | Diluted earnings per common share | $1.07 | $0.92 | | | Adjusted EBITDA | $60,700 | $57,710 | $2,990 | Revenues and Flight Hours by Segment This section provides a detailed breakdown of revenues and flight hours for each operating segment, highlighting the growth drivers and operational activity across different regions Revenues by Segment (in thousands) | Segment (in thousands) | June 30, 2025 | March 31, 2025 | Favorable/(Unfavorable) | Change (%) | | :----------------------- | :------------ | :------------- | :---------------------- | :--------- | | Offshore Energy Services: | | | | | | Europe | $107,625 | $101,218 | $6,407 | 6.3% | | Americas | $95,230 | $91,569 | $3,661 | 4.0% | | Africa | $49,955 | $46,998 | $2,957 | 6.3% | | Total Offshore Energy Services | $252,810 | $239,785 | $13,025 | 5.4% | | Government Services | $92,499 | $85,943 | $6,556 | 7.6% | | Other Services | $31,120 | $24,802 | $6,318 | 25.5% | | Total Revenues | $376,429 | $350,530 | $25,899 | 7.4% | Flight Hours by Segment (hours) | Segment Flight Hours | June 30, 2025 | March 31, 2025 | Favorable/(Unfavorable) | Change (%) | | :--------------------- | :------------ | :------------- | :---------------------- | :--------- | | Offshore Energy Services: | | | | | | Europe | 8,838 | 8,749 | 89 | 1.0% | | Americas | 10,700 | 10,002 | 698 | 7.0% | | Africa | 4,931 | 4,680 | 251 | 5.4% | | Total Offshore Energy Services | 24,469 | 23,431 | 1,038 | 4.4% | | Government Services | 4,868 | 3,941 | 927 | 23.5% | | Other Services | 3,684 | 3,400 | 284 | 8.4% | | Total Flight Hours | 33,021 | 30,772 | 2,249 | 7.3% | Second Quarter Segment Statements of Operations This section provides a detailed breakdown of revenues, operating expenses, and operating income (loss) for each segment and corporate, both on a GAAP and Adjusted Operating Income basis, for Q2 2025 and Q1 2025 Q2 2025 Segment Statements of Operations (in thousands) | Segment (in thousands) | Q2 2025 Revenues | Q2 2025 Operating Income (Loss) | Q2 2025 Adjusted Operating Income (Loss) | | :----------------------- | :--------------- | :------------------------------ | :--------------------------------------- | | Offshore Energy Services | $252,810 | $43,595 | $53,588 | | Government Services | $92,499 | $(1,912) | $6,036 | | Other Services | $31,120 | $3,443 | $6,188 | | Corporate | — | $(2,486) | $(8,482) | | Consolidated | $376,429 | $42,640 | $57,330 | Q1 2025 Segment Statements of Operations (in thousands) | Segment (in thousands) | Q1 2025 Revenues | Q1 2025 Operating Income (Loss) | Q1 2025 Adjusted Operating Income (Loss) | | :----------------------- | :--------------- | :------------------------------ | :--------------------------------------- | | Offshore Energy Services | $239,785 | $37,365 | $47,114 | | Government Services | $85,943 | $6,011 | $13,719 | | Other Services | $24,802 | $(622) | $2,037 | | Corporate | — | $(9,206) | $(8,517) | | Consolidated | $350,530 | $33,548 | $54,353 | Condensed Consolidated Balance Sheets The condensed consolidated balance sheets present the company's financial position as of June 30, 2025, compared to December 31, 2024, showing changes in assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets (in thousands) | Balance Sheet Item (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | ASSETS: | | | | Total current assets | $670,173 | $619,458 | | Property and equipment, net | $1,163,152 | $1,076,221 | | Total assets | $2,288,026 | $2,125,246 | | LIABILITIES AND STOCKHOLDERS' EQUITY: | | | | Total current liabilities | $371,132 | $325,900 | | Long-term debt, less current maturities | $680,412 | $671,169 | | Total liabilities | $1,304,038 | $1,233,974 | | Total Bristow Group Inc. stockholders' equity | $984,370 | $891,707 | | Total liabilities and stockholders' equity | $2,288,026 | $2,125,246 | Non-GAAP Financial Measures Reconciliations This section provides reconciliations for non-GAAP financial measures including EBITDA, Adjusted EBITDA, Free Cash Flow, Adjusted Free Cash Flow, and Adjusted Operating Income by segment EBITDA and Adjusted EBITDA This section defines EBITDA and Adjusted EBITDA as non-GAAP measures used by management to assess operating performance, providing a reconciliation from net income. Adjusted EBITDA excludes non-cash gains/losses, foreign exchange impacts, and certain special items to offer a clearer view of core business activities - EBITDA is defined as Earnings before Interest expense, Taxes, Depreciation and Amortization[32] - Adjusted EBITDA further adjusts EBITDA for non-cash gains/losses on asset sales, non-cash foreign exchange gains/losses, and special items like PBH maintenance amortization, insurance gains, and nonrecurring professional service fees or strategic activity costs[32] EBITDA and Adjusted EBITDA Reconciliation (in thousands) | Metric (in thousands) | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | LTM | | :-------------------------- | :------------ | :------------- | :---------------- | :----------------- | :-------- | | Net income | $31,779 | $27,381 | $31,768 | $28,279 | $119,207 | | Depreciation and amortization expense | $17,312 | $16,841 | $16,701 | $17,569 | $68,423 | | Interest expense, net | $10,034 | $9,490 | $9,064 | $9,660 | $38,248 | | Income tax expense (benefit) | $20,443 | $10,183 | $(12,952) | $8,392 | $26,066 | | EBITDA | $79,568 | $63,895 | $44,581 | $63,900 | $251,944 | | (Gains) losses on disposal of assets | $(6,209) | $558 | $82 | $626 | $(4,943) | | Foreign exchange (gains) losses | $(17,435) | $(11,045) | $12,581 | $(10,904) | $(26,803) | | Special items | $4,776 | $4,302 | $596 | $6,558 | $16,232 | | Adjusted EBITDA | $60,700 | $57,710 | $57,840 | $60,180 | $236,430 | Free Cash Flow and Adjusted Free Cash Flow This section defines Free Cash Flow and Adjusted Free Cash Flow as non-GAAP measures, providing insight into the company's ability to generate cash from its business. Adjusted Free Cash Flow further excludes costs related to certain special items - Free Cash Flow represents net cash provided by (used in) operating activities less maintenance capital expenditures[36] - Adjusted Free Cash Flow is Free Cash Flow adjusted to exclude costs paid in relation to certain special items, such as professional service fees for unusual litigation and other nonrecurring strategic activity costs[36] Free Cash Flow and Adjusted Free Cash Flow Reconciliation (in thousands) | Metric (in thousands) | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | LTM | | :------------------------------------ | :------------ | :------------- | :---------------- | :----------------- | :-------- | | Net cash provided by (used in) operating activities | $99,039 | $(603) | $51,054 | $66,022 | $215,512 | | Less: Maintenance capital expenditures | $(4,532) | $(1,886) | $(2,739) | $(8,041) | $(17,198) | | Free Cash Flow | $94,507 | $(2,489) | $48,315 | $57,981 | $198,314 | | Plus: Special items | $786 | $740 | $(2,580) | $1,539 | $485 | | Adjusted Free Cash Flow | $95,293 | $(1,749) | $45,735 | $59,520 | $198,799 | Adjusted Operating Income by Segment This section defines Adjusted Operating Income (Loss) by segment as a non-GAAP measure, providing a supplemental view of each segment's operating performance by excluding depreciation, amortization, and gains/losses on asset dispositions - Adjusted Operating Income (Loss) is defined as operating income (loss) before depreciation and amortization (including PBH amortization) and gains or losses on asset dispositions[38] Q2 2025 Adjusted Operating Income by Segment (in thousands) | Segment (in thousands) | Q2 2025 Operating Income (Loss) | Q2 2025 Adjusted Operating Income | | :----------------------- | :------------------------------ | :-------------------------------- | | Offshore Energy Services | $43,595 | $53,588 | | Government Services | $(1,912) | $6,036 | | Other Services | $3,443 | $6,188 | | Corporate | $(2,486) | $(8,482) | | Consolidated Adjusted Operating Income | $42,640 | $57,330 | Q1 2025 Adjusted Operating Income by Segment (in thousands) | Segment (in thousands) | Q1 2025 Operating Income (Loss) | Q1 2025 Adjusted Operating Income | | :----------------------- | :------------------------------ | :-------------------------------- | | Offshore Energy Services | $37,365 | $47,114 | | Government Services | $6,011 | $13,719 | | Other Services | $(622) | $2,037 | | Corporate | $(9,206) | $(8,517) | | Consolidated Adjusted Operating Income | $33,548 | $54,353 | Fleet Information This section details Bristow Group's fleet composition, including aircraft types, ownership, average age, and deployment across its operating segments Fleet Composition and Deployment Bristow Group's fleet consists of 211 aircraft, predominantly helicopters, with a significant portion owned by the company. The fleet is strategically distributed across its three operating segments, with additional aircraft under construction and options for future expansion Fleet Composition | Aircraft Type | Owned Aircraft | Leased Aircraft | Total Aircraft | Average Age (years) | | :-------------------------- | :------------- | :-------------- | :------------- | :------------------ | | Heavy Helicopters | 53 | 33 | 86 | 15 | | Medium Helicopters | 63 | 5 | 68 | 14 | | Light—Twin Engine Helicopters | 14 | — | 14 | 13.5 (avg of 18 and 9) | | Light—Single Engine Helicopters | 25 | — | 25 | 22.5 (avg of 26 and 19) | | Total Helicopters | 155 | 38 | 193 | 15 | | Fixed Wing | 9 | 5 | 14 | | | Unmanned Aerial Systems ("UAS") | 4 | — | 4 | | | Total Fleet | 168 | 43 | 211 | | Fleet Deployment by Segment | Segment | Percentage of Total Revenues | Heavy Helicopters | Medium Helicopters | Light Twin Helicopters | Light Single Helicopters | Fixed Wing | UAS | Total Aircraft | | :----------------------- | :--------------------------- | :---------------- | :----------------- | :--------------------- | :----------------------- | :--------- | :-- | :------------- | | Offshore Energy Services | 68% | 57 | 60 | 11 | — | 1 | — | 129 | | Government Services | 25% | 29 | 7 | 3 | 20 | — | 4 | 63 | | Other Services | 7% | — | 1 | — | 5 | 13 | — | 19 | | Total | 100% | 86 | 68 | 14 | 25 | 14 | 4 | 211 | - The company has 15 new aircraft under construction (10 AW189 heavy, 4 AW139 medium, 1 H135 light-twin) and options for an additional 20 helicopters (10 AW189 heavy, 10 H135 light-twin)[43][44]