- Agreements with Leonardo Helicopters and Pratt & Whitney provide comprehensive, long-term maintenance support for AW139 airframes and engines, respectively
- Aligns multiple disparate pre-merger agreements into a cohesive program that will result in lower maintenance costs and more consistent cash flow for the company
- These agreements mitigate cost uncertainty in an inflationary environment and will result in maintenance expenditures more directly correlated to flight hours
- Expected cash-on-cash and unleveraged returns of around 20% over the life of the agreements
HOUSTON, June 30, 2022 /PRNewswire/ — Bristow Group Inc. (NYSE: VTOL) today announced that it has signed favorable long-term maintenance support agreements with Leonardo Helicopters for airframes and Pratt & Whitney for engines for the global fleet of company’s AW139 helicopters.
The former Era AW139 fleet was previously covered by a power-per-hour (“PBH”) limited support agreement with Leonardo for the airframes, while the engines were serviced on a time and material cost basis. The former Bristow AW139 fleet was covered by multiple disparate PBH support agreements with Leonardo for the airframes, and the engines were covered by a PBH agreement with Pratt & Whitney. The new agreements result in consistent worldwide maintenance support programs for Bristow’s AW139 helicopters, both for airframes and engines.
“Following the merger of Era and Bristow in June 2020, we have been working for two years to align our AW139 maintenance support agreements on the most favorable terms possible for Bristow,” said Stuart Stavley, Senior Vice President , Global Fleet Management. “The cost certainty contained in these agreements is particularly valuable given the broader economic context of the current inflationary environment.”
The total redemption cost is approximately $55 million, which will be paid in installments between June and December 2022.
“These long-term agreements provide greater certainty and profitability for our global fleet of AW139s,” said Chris Bradshaw, Bristow President and CEO. “In addition to the direct investment benefits, which are expected to generate unleveraged cash returns of approximately 20% over the term of the agreements, these new support programs will result in maintenance expenses that are more directly correlated to hours of flight and provide more predictable cash flows for the company.Furthermore, we believe that standardizing these maintenance programs and associated reserves enhances the value of Bristow’s AW139 aircraft, and we believe that all of the agreements , including improved cash flow for the company, represents substantial value creation for Bristow shareholders.”
In addition to the AW139 agreements, Bristow has also signed long-term maintenance support agreements with Leonardo for the AW189 airframe and with Honeywell for the AW139 avionics suite. Bristow also signed a long-term maintenance agreement with General Electric for support of the AW189 and S-92 engines.
About the Bristow Group
Bristow Group Inc. is the world’s leading provider of innovative and sustainable vertical flight solutions. Bristow primarily provides aviation services to a broad base of large integrated, national and independent offshore energy companies. Bristow provides commercial search and rescue (SAR) services in several countries and public sector SAR services in the United Kingdom (UK) on behalf of the Maritime & Coastguard Agency (MCA). In addition, the Company provides one-time helicopter and fixed-wing transportation services.
Bristow currently has clients in Australia, Brazil, Canada, Chile, Dutch Caribbean, Guyana, India, Mexico, Netherlands, Nigeria, Norway, Spain, Suriname, Trinidad , UK and USA. To learn more, visit our website at www .bristowgroup.com.
Disclosure of forward-looking statements
This press release contains “forward-looking statements”. Forward-looking statements represent the current expectations or forecasts of Bristow Group Inc. (the “Company”) regarding future events. Forward-looking statements can generally be identified by the use of forward-looking words such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”. , “plans”, or “continue”, or other similar words, and include statements regarding the expected benefits of the maintenance support agreements disclosed herein. These statements are made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, reflect the current views of management regarding future events, and are therefore subject to significant risks and uncertainties, known and unknown. The Company’s actual results may differ materially from those anticipated in the forward-looking statements. The Company cautions investors not to place undue reliance on forward-looking statements.
Forward-looking statements speak only as of the date of the document in which they are made. The Company disclaims any obligation or undertaking to provide updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which the forward-looking statement is based and that occur after the date hereof. Risks that could affect forward-looking statements include, but are not limited to, those related to: our inability to execute our business strategy; the credit risk of our counterparties; a lack of availability of aircraft components and parts needed to maintain and repair our helicopters and fixed-wing aircraft and increases in supplier costs; global and regional changes in demand, supply, prices or other market conditions affecting oil and gas, including changes resulting from a public health crisis or the imposition or lifting of crude oil production quotas or other measures that may be imposed by the Organization of the Petroleum Exporting Countries (OPEC) and other producing countries; fluctuations in demand for our services; the possibility that segments of our fleet may be grounded for long periods or indefinitely; the existence of operational risks inherent in our business, including the possibility of reduced safety performance; the impact of supply chain disruptions and inflation and our ability to recover rising costs in the rates we charge our customers; and our reliance on a limited number of helicopter manufacturers and suppliers.
If one or more of these risks materialize, or if underlying assumptions prove incorrect, actual results may differ materially from those expected. You should not place undue reliance on our forward-looking statements, as the matters they describe are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond our control. Our forward-looking statements are based on information currently available to us and speak only as of the date hereof. New risks and uncertainties arise from time to time, and it is impossible for us to predict these matters or how they may affect us. We have included important factors in the section titled “Risk Factors” of the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2022 (the “Annual Report”) that we believe could cause our actual results, performance or achievements will differ from any anticipated results, performance or achievements that are expressed or implied by our forward-looking statements. You should consider all risks and uncertainties disclosed in the Annual Report and in our filings with the United States Securities and Exchange Commission (the “SEC”), all of which are available on the SEC’s website at the address www.sec.gov.
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SOURCE Bristow Group