Bristow(US:VTOL)2023-11-04 12:07Financial Data and Key Metrics Changes - Adjusted EBITDA for Q4 2022 was $36.3 million, an increase from $33.9 million in Q3 2022, reflecting a growth of approximately $2 million [11] - Operating revenues increased by $5 million, primarily due to higher government services revenues and increased activity levels in offshore energy [12] - Available liquidity as of December 31 was $240 million after cash outflows of $32 million for aircraft purchases and $24 million related to PBH buying [16] Business Line Data and Key Metrics Changes - The government services segment has expanded with new contracts for search and rescue (SAR) operations in the Netherlands and the Dutch Caribbean, both being 10-year contracts [7][8] - The offshore energy services market is expected to see a significant increase in spending, with Barclays Research projecting a 24% increase in 2023 following a 12% increase in 2022 [18] Market Data and Key Metrics Changes - The offshore helicopter market is experiencing a tightening supply-demand balance, with significant increases in leading-edge rates due to constrained global labor force and equipment market [21][28] - The market for AW139 and super medium helicopters is expected to remain tight, with limited available capacity [20] Company Strategy and Development Direction - The company is focused on expanding its government services business and is involved in active tender processes for additional contracts [17] - A realignment of the management team aims to enhance focus on government services and offshore services, allowing for better customer engagement and adaptation to market needs [36] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about improved fundamentals and outlook for 2023, driven by increasing offshore energy activity and a growing government services business [54] - The first quarter of the year is traditionally the weakest due to seasonality, but the company expects better utilization of the fleet and higher revenues in the second half of the year [21][22] Other Important Information - The company has initiated guidance for 2023, anticipating revenues between $1.2 billion and $1.3 billion, with adjusted EBITDA of $150 million to $170 million [14] - The company completed new equipment financing of approximately £140 million to support obligations under the SAR contract in the U.K. [9][10] Q&A Session Summary Question: Timing and ramp-up of revenues for Bristow - Management indicated that new contracts are scheduled to start throughout the year, with some back-end weighted, particularly in Brazil and Norway [24][25] Question: Impact of increasing costs on the bottom line - Management acknowledged inflationary pressures, particularly in labor and supply chain costs, but emphasized visibility due to union agreements and long-term contracts [27][28] Question: Growth potential in offshore wind - Management sees offshore wind as a growing market but noted that the U.S. market is still nascent, with no offshore helicopters currently supporting wind projects [29][30] Question: Acceleration of CapEx related to U.K. SAR contract - Management clarified that the total CapEx needed has not changed, but the timing has been pulled forward to ensure successful contract execution [34] Question: Structural changes and new opportunities - The management realignment aims to better position the company for growth in government services, with active participation in upcoming tenders [36][38] Question: Strategy for off-lease aircraft - Management stated that they have orders for new AW139 helicopters and are evaluating the market for additional AW189 helicopters as needed [39][40] Question: Current stock value and NAV - Management noted that the shares are trading at a significant discount to the net asset value, which is approximately $48 per share based on third-party appraisals [47][49]