Discovery Air Inc. announces results for the quarter and year ended January 31, 2017

TORONTO, April 13, 2017 /CNW/ - Discovery Air Inc. (the "Corporation") announced its financial and operating results for the quarter and year ended January 31, 2017.  The audited consolidated financial statements and management discussion and analysis ("MD&A") will be available on SEDAR at www.sedar.com and on the Corporation's website at www.discoveryair.com.












Selected Financial Information

Three months ended January 31


Year ended January 31

(thousands of Canadian dollars, except per share amounts)


2017



2016


% change



2017



2016


% change

Results of continuing operations*

















Revenue

$

31,957


$

29,904


7%


$

171,055


$

182,181


-6%


EBITDA**

$

(3,389)


$

(6,394)


47%


$

21,768


$

26,652


-18%


Income (loss)

$

(12,210)


$

(13,399)


9%


$

(18,075)


$

(14,827)


-22%


Basic and diluted income (loss) per share

$

(0.15)


$

(0.17)


12%


$

(0.22)


$

(0.19)


-16%



















Cash provided by operations

$

(3,930)


$

6,094




$

2,808


$

12,814


-78%


Working Capital**









$

47,833


$

41,689


15%


















* The results have been presented to show continuing operations for all periods. This excludes discontinued operations of Discovery Air Technical Services Inc.

** See "Non-IFRS measures" below


Financial Highlights

  • Consolidated revenues for the three months ended January 31, 2017 ("Current Quarter") increased 7%, in comparison to the three months ended January 31, 2016 ("Comparative Period") due to increased fire suppression activity in South America.

  • EBITDA loss for the Current Quarter decreased by 47% in comparison to the Comparative Period, primarily due to increased revenue with decreased operating expenses due to continued cost containment efforts.

  • Loss for the Current Quarter was $12.2 million compared to $13.4 million for the Comparative Period. The variance was mainly attributable to increased EBITDA.

  • Consolidated revenues for the year ended January 31, 2017 ("Year-to-date") decreased 6%, in comparison to the year ended January 31, 2016 ("Comparative Year") primarily due to decreased fire suppression activity in Northern Canada and South America, as well as the continued decline in mining exploration industry.

  • Year-to-date EBITDA decreased by 18% in comparison to the Comparative Year, primarily due to decreased revenue.

  • Year-to-date loss was $18.1 million compared to $14.8 million for the Comparative Year. The variance was mainly attributable to decreased EBITDA.

"Fourth quarter revenues showed improvement over prior year" reported Jacob (Koby) Shavit, the Corporation's President and Chief Executive Officer. "The increased fire suppression activity in South America for the fourth quarter, along with continued emphasis on cost containment helped mitigate the impact of the ongoing downturn in the oil and gas and mining industries.  As we enter into a new fiscal year we continue to remain focused on specific growth opportunities, while continuing to streamline operations with an emphasis on efficient use of resources and assets."

Recent Developments

  • In March 2017, DA Defence along with Air Affairs Australia Pty Ltd., was awarded a two-year trial contract by the Commonwealth of Australia to provide Red Air and fighter support to the Australian Defence Force.

  • On January 31, 2017, the Corporation completed the sale of Fire Services for total proceeds of $16.0 which resulted in a pre-tax gain on disposal of $0.3 million.

  • In January 2017, GSH was awarded a five year contract for two aircraft with the government of Alberta.  During the contract period, GSH will be performing fire suppression activities.

  • In January 2017, GSH was hired as the prime helicopter contractor to service a resource development project in Bolivia.  The contract is for two aircraft and a minimum of one year.

  • In December 2016, Air Tindi was awarded a three year contract in northern Canada to transport personnel and equipment to remote worksites.

  • On December 20, 2016, DA Defence entered into a $25.0 million secured revolving loan agreement with certain Clairvest Group Inc. affiliates ("Clairvest") that matures on June 30, 2017.

  • On March 24, 2017, the Corporation announced that certain funds managed by Clairvest Group Inc. have entered into a definitive agreement which will result in Clairvest, along with certain management shareholders of the Corporation, holding all of the issued and outstanding shares in the capital of the Corporation by way of a plan of arrangement pursuant to the Canada Business Corporations Act. This transaction would not constitute a change of control, as it relates to the convertible unsecured subordinated debentures.

Forward-Looking Statements

Forward-looking information and statements are included in this earnings release.  Please refer to the statement regarding forward-looking statements contained in the Corporation's MD&A for the year ended January 31, 2017, which are incorporated herein by reference.  That statement provides an explanation as to what forward-looking statements are, and the specific factors, uncertainties and potential events that the Corporation has identified for the attention of readers.  When relying on forward-looking information and statements to make decisions, investors and others should carefully consider these factors and other uncertainties and potential events.

The Corporation's audited consolidated financial statements and MD&A for the year ended January 31, 2017, have been filed concurrently and are available on the Corporation's website at www.discoveryair.com and on SEDAR at www.sedar.com. The reader is encouraged to review the audited consolidated financial statements and MD&A for the year ended January 31, 2017 for more complete disclosure on the Corporation's financial condition and results of operations.

The Corporation's Class A common voting shares and unsecured convertible debentures trade on the Toronto Stock Exchange under the symbols DA.A and DA.DB.A, respectively.

Non-IFRS Measures

References to "EBITDA" are to net profit (loss) before finance costs, income taxes, depreciation of property and equipment and intangible assets, gains and losses on disposal of assets and extinguishment of debt, gains on acquisition and disposals, impairment losses, and gains and losses resulting from the change in fair value of financial liabilities. Management believes EBITDA to be an important metric in measuring the performance of the Corporation's day-to-day operations. This measurement is useful in assessing the Corporation's ability to service debt and to meet other payment obligations, and as a basis for valuation. "Working Capital" is current assets less current liabilities excluding current portion of loans and borrowings and operating line of credit. 

SOURCE Discovery Air Inc.

For further information: please contact: Sheila Venman, VP Human Resources & Communications, sheila.venman@discoveryair.com, 1-866-903-3247

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