Bristow Group has released its trading figures for Q2 2023, revealing that while the company had increased revenue quarter on quarter from US$302m to $319.4m, its losses for the period also grew by $100,000 to $1.6m. However, the adjusted EBITDA (excluding special items, gains or losses on asset dispositions and foreign exchange losses was $39.0 million in Q2 compared to $28.9 million in Q1. Which Bristow Group President Chris Bradshaw said is “evidence of the building momentum for Bristow’s business in 2023,” adding, “We continue to believe the Company’s financial performance in the second half of the year will be significantly higher than the first half of this year, setting up positively for stronger financial results in 2024, as highlighted by our recently issued Adjusted EBITDA guidance of $190 – $220 million for next year.”
Sequential Quarter Results
According to Bristow, the improvement in operating revenues comes primarily as a result of higher utilisation in offshore operations ($13.6m higher) and an improvement in government services (up by $5m) thanks to a strengthening pound-to-dollar (GB£/US$) exchange ratio. The utilisation of fixed-wing services was also up, boosting revenues by $0.5m, although revenues from other services were down by the same amount, mainly due to lower dry lease payments.
Other hits came from higher operating expenses ($13.9 million higher), primarily due to higher repairs and maintenance costs, additional operating costs, and a non-cash, nonrecurring write-off related to amounts from legacy insurance policies. However, lower fuel costs partially offset this. In addition, the company sold or otherwise disposed of three helicopters and other assets, resulting in a net loss of $3.2 million, whereas, in Q1, a similar asset disposal resulted in a gain of $3.3m.
Foreign exchange losses continue to be a source of woe for Bristow, with a loss of $13m in Q2, significantly higher than in the first quarter.
2023 and 24 projections
Bristow has affirmed its performance projections as follows, revealing select financial targets for the calendar years 2023 and 2024 (in US$, millions):
2023E | 2024E | ||
Operating revenues: | |||
Offshore energy services | $755 – $830 | $850 – $970 | |
Government services | $340 – $355 | $340 – $365 | |
Fixed-wing services | $95 – $110 | $95 – $115 | |
Other services | $10 – $15 | $10 – $15 | |
Total operating revenues | $1,200 – $1,310 | $1,295 – $1,465 | |
Adjusted EBITDA(1), excluding asset dispositions and foreign exchange losses | $150 – $170 | $190 – $220 | |
Cash interest | ~$40 | ~$40 | |
Cash taxes | $20 – $25 | $20 – $25 | |
Maintenance capital expenditures | $20 – $25 | $15 – $20 |
