MONTREAL, Sept. 23 /CNW Telbec/ - Canadian Helicopters Income Fund (TSX: CHL.UN) announces that one of its three contracts in respect of the support of the North Warning System, formerly with the United States Air Force, will not be renewed beyond its September 30, 2009 expiry date. United States Transportation Command ("USTRANSCOM") informed Canadian Helicopters yesterday that it had selected one of Canadian Helicopters' competitors to provide the services previously provided under the contract. USTRANSCOM's decision was taken following a competitive bidding process pertaining to the services provided under each of the three contracts, in which Canadian Helicopters tendered proposals and actively participated. USTRANSCOM also informed Canadian Helicopters that it would reach a decision on the other two contracts shortly and that it would inform Canadian Helicopters accordingly.
The three contracts, originally set to terminate on September 30, 2008, were extended for two successive six-month terms until September 30, 2009.
The non-renewed contract, pertaining to the year-round maintenance of North Warning System radar sites, represented revenues of $10.3 million during the period from July 1, 2008 to June 30, 2009 and was the largest of the three contracts in terms of revenue. The services were provided by Canadian Helicopters using five medium and heavy aircraft. The other two contracts pertain to additional services (including fuel re-supply, radar maintenance and construction) provided by Canadian Helicopters essentially during the summer months and represented revenues of approximately $5 million, in aggregate, over the same period.
Canadian Helicopters has been providing helicopter transportation services to the US military for over 19 years. Regardless of USTRANSCOM's ultimate decision on the two outstanding contracts in respect of the North Warning System, Canadian Helicopters intends to continue seeking business opportunities with USTRANSCOM.
"While the non-renewal is disappointing, we have enjoyed working with the United States Air Force on the North Warning System over the last few years as part of our ongoing relationship with the US military and look forward to continue working with the US military on this or on any other project where our services may be required" said Don Wall, Senior Executive Vice President.
ABOUT CANADIAN HELICOPTERS INCOME FUND
Through Canadian Helicopters Limited, Canadian Helicopters Income Fund is the largest helicopter transportation services company operating in Canada and one of the largest in the world based on the size of its fleet. From over 40 base locations across Canada, Canadian Helicopters provides helicopter services to a broad range of sectors, including emergency medical services, infrastructure maintenance, utilities, oil and gas, forestry, mining and construction. In addition to helicopter transportation services, Canadian Helicopters operates three flight schools and provides third party repair and maintenance services. With over 60 years of experience, Canadian Helicopters is an industry leader in establishing safety standards and operating procedures.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements relating to the future of the contractual relationship between Canadian Helicopters and the US military and Canadian Helicopters' intentions. Such forward-looking statements are based, inter alia, on USTRANSCOM's conclusions from the competitive bidding process and management evaluation of future prospects and are subject to certain risks and uncertainties. Actual results or events may differ materially and, consequently, readers should not place any undue reliance on such forward-looking statements. The forward-looking statements relate to the date of this press release. Canadian Helicopters Income Fund disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise unless being required by applicable laws.
SOURCE HNZ Group Inc.
For further information: For further information: Canadian Helicopters Income Fund: Jean-Pierre Blais, President, (450) 452-3007; Don Wall, Senior Executive Vice-President, (780) 429-6919