PHI, Inc. (The Nasdaq Select Global Market: PHII (voting) PHIIK
(non-voting)) today reported financial results for the quarter
ended September 30, 2018.
Consolidated operating revenues for the quarter ended September
30, 2018 were $168.8 million, compared to $150.2 million for the
quarter ended September 30, 2017, an increase of $18.6 million. Oil
and Gas segment operating revenues increased $17.6 million for the
quarter ended September 30, 2018. This increase is attributable
principally to revenue derived from our recently-acquired HNZ
offshore business and from an increase in revenues in our legacy
international operations. Air Medical segment operating revenues
remained unchanged at $70.2 million for the quarter ended September
30, 2018 and September 30, 2017. Technical Services segment
operating revenues increased $1.1 million. Consolidated net loss
for the quarter ended September 30, 2018 was $11.5 million compared
to net loss of $3.3 million for the quarter ended September 30,
2017.
Oil and Gas segment loss was $5.8 million for the quarter ended
September 30, 2018, compared to a loss of $6.9 million for the
quarter ended September 30, 2017. The $1.1 million decrease in
segment loss is primarily attributable to profit from our HNZ
offshore business and PHI legacy international operations, as well
as cost reductions in our legacy Gulf of Mexico operations.
Air Medical segment profit was $6.2 million for the quarter
ended September 30, 2018, compared to a segment profit of $16.0
million for the quarter ended September 30, 2017. The $9.8 million
decrease in profit is primarily attributable to increased employee
compensation costs and decreased transports at our existing bases.
The decline in transports for existing bases is primarily due to
weather-related issues.
Technical Services segment profit was less than $0.1 million for
both the quarters ended September 30, 2018 and September 30,
2017.
Unallocated selling, general and administrative costs were $7.9
million for the quarter ended September 30, 2018 compared to $6.8
million for the quarter ended September 30, 2017. The $1.1 million
increase was principally attributable to increase in legal and
consulting fees.
For additional information, please see (i) the attachments
hereto and (ii) Form 10-Q for the quarter ended September 30, 2018
that we filed today with the U.S. Securities and Exchange
Commission.
Forward-Looking Statements
Except for historical and factual information, the matters set
forth in this release are forward-looking statements as defined by
the federal securities laws, and are subject to the “safe harbor”
protections thereunder. These forward-looking statements are not
guarantees of future results, and are based on our current
expectations only, are inherently speculative, and are subject to a
number of assumptions, risks and uncertainties, many of which are
beyond our control. Actual events and results may differ materially
from those anticipated, estimated, projected, or implied by us if
one or more of these risks or uncertainties materialize, or if our
underlying assumptions prove incorrect. Factors that could affect
actual results include but are not limited to our ability to
refinance our short-term debt, adverse changes in our access to
credit markets, and to the other risks referenced in our filings
with the U.S. Securities and Exchange Commission (the “SEC”). For
all the reasons set forth above and in our SEC reports, you are
cautioned not to place undue reliance upon any of our
forward-looking statements included in this release, which speak
only as of the date made. We undertake no obligation to publicly
update or revise any of our forward-looking statements for any
reason, whether as a result of new information, future events or
developments, changed circumstances, or otherwise.
PHI provides helicopter transportation and related services to a
broad range of customers including the oil and gas and air medical
industries, and also provides third-party maintenance services to
select customers. PHI Voting Common Stock and Non-Voting Common
Stock are traded on The NASDAQ Global Market (symbols PHII and
PHIIK).
PHI, INC. AND SUBSIDIARIES
Consolidated Statements of
Operations
(Thousands of dollars and shares, except
per share data)
(Unaudited)
Quarter Ended September 30, Nine Months
Ended September 30, 2018 2017
2018 2017 Operating revenues, net $
168,787 $ 150,167 $ 498,400 $ 431,209
Expenses: Direct
expenses 160,200 136,786 471,509 400,250 Selling, general and
administrative expenses 16,255 11,401 46,199
38,691 Total operating expenses 176,455 148,187 517,708
438,941 (Gain) loss on disposal of assets — (4 ) 708 3 Equity in
(gain) loss of unconsolidated affiliate, net (118 ) (438 ) (162 )
1,556 Operating (loss) income (7,550 ) 2,422 (19,854 )
(9,291 ) Interest expense 8,357 8,027 24,894 24,305 Other income –
net (1,845 ) (706 ) (436 ) (2,474 ) 6,512 7,321
24,458 21,831 Loss before income taxes (14,062 )
(4,899 )
(44,312
) (31,122 ) Income tax benefit (2,531 ) (1,622 ) (8,705 ) (9,324 )
Net loss $ (11,531 ) $ (3,277 ) $ (35,607 ) $ (21,798 )
Weighted average shares outstanding: Basic 15,816 15,799
15,811 15,750 Diluted 15,816 15,799 15,811 15,750 Net loss per
share: Basic $ (0.73 ) $ (0.21 ) $ (2.25 ) $ (1.38 ) Diluted $
(0.73 ) $ (0.21 ) $ (2.25 ) $ (1.38 )
A-1
Summarized financial information concerning our reportable
operating segments for the quarters and nine months ended
September 30, 2018 and 2017 is as follows:
Quarter Ended September 30, Nine
Months Ended September 30, 2018
2017 2018 2017 (Thousands of dollars)
(Thousands of dollars) Segment operating revenues Oil and Gas $
93,338 $ 75,700 $ 286,046 $ 222,098 Air Medical 70,192 70,280
194,331 192,840 Technical Services 5,257 4,187 18,023
16,271 Total operating revenues, net 168,787
150,167 498,400 431,209 Segment direct
expenses Oil and Gas (1) 94,832 81,467 285,818 236,878 Air Medical
60,358 51,120 170,966 152,363 Technical Services 4,892 3,761
14,563 12,565 Total direct expenses 160,082
136,348 471,347 401,806 Segment selling, general and administrative
expenses Oil and Gas 4,321 1,148 13,642 4,501 Air Medical 3,666
3,136 10,087 9,280 Technical Services 356 338 1,066
1,032 Total selling, general and administrative
expenses 8,343 4,622 24,795 14,813
Total segment direct and selling, general and administrative
expenses 168,425 140,970 496,142 416,619
Net segment (loss) profit Oil and Gas (5,815 ) (6,915 )
(13,414
) (19,281 ) Air Medical 6,168 16,024 13,278 31,197 Technical
Services 9 88 2,394 2,674 Total net
segment profit 362 9,197 2,258 14,590 Other, net (3) 1,845
710 (272 ) 2,471 Unallocated selling, general and administrative
costs (1) (4) (7,912 ) (6,779 ) (21,404 ) (23,878 ) Interest
expense (8,357 ) (8,027 ) (24,894 ) (24,305 ) (Loss) earnings
before income taxes $ (14,062 ) $ (4,899 ) $ (44,312 ) $ (31,122 )
(1) Includes equity in (earnings) of unconsolidated
affiliates, net. (2) These financial measures have not been
prepared in accordance with generally accepted accounting
principles (“GAAP”) and have not been audited or reviewed by our
independent registered public accounting firm. These financial
measures are therefore considered non-GAAP financial measures.
Management believes these non-GAAP financial measures provide
meaningful supplemental information regarding our results of
operations. A description of the adjustments to and reconciliations
of these non-GAAP financial measures to the most comparable GAAP
financial measures is as follows:
Quarter
Ended Nine Months Ended September 30,
September 30, 2018
2017 2018
2017 Total net segment profit $ 362 $ 9,197 $
2,258 $ 14,590 Other, net 1,845 710 (272 ) 2,471 Unallocated
selling, general and administrative costs (7,912 ) (6,779 ) (21,404
) (23,878 ) Interest expense (8,357 ) (8,027 )
(24,894 ) (24,305 ) (Loss) earnings before income taxes $
(14,062 ) $ (4,899 ) $ (44,312 ) $ (31,122 ) (3) Consists of
(gains) losses on disposition of property and equipment and other
income. (4) Represents corporate overhead expenses not allocable to
segments.
A-2
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PHI, Inc.Trudy McConnaughhay, 337-235-2452Chief Financial
Officer