MONTREAL, May 13 /CNW Telbec/ - Canadian Helicopters Income Fund (TSX:
CHL.UN) ("the Fund"), the largest helicopter transportation services company
operating in Canada, today announced its financial and operating results for
the first quarter ended March 31, 2009.
Revenue reached $26.5 million, an increase of 5.9%, or $1.5 million, over
revenue of $25.0 million a year ago. Instrument Flight Rules (IFR) revenue
increased by $0.9 million, primarily reflecting favourable currency
fluctuations, Visual Flight Rules (VFR) revenue grew $1.2 million as the
commencement of the Fund's support contract for the U.S. Department of Defense
("DoD") in Afghanistan offset weaker resource-based activity, and Ancillary
revenue, including the CFTS contract, declined $0.6 million. While
revenue-flying hours declined 11.1% to 9,422 hours, a more favourable mix of
helicopter transportation services generated stronger revenue.
The DoD support contract involves the provision of three fully crewed and
supported Bell 212 medium category aircraft from Canadian Helicopters'
existing fleet to facilitate movement of supplies and passengers for DoD in
Afghanistan. The mandate is for a one-year base period with four one-year
extensions at DoD's option. The contract, denominated in U.S. dollars, is
comprised primarily of a fixed monthly rate and variable hourly revenue
components. Total revenue to the Fund, which reflects the significantly higher
effort required to accomplish the work in Afghanistan, is expected to exceed
US$120 million over five years, assuming all option periods are exercised and
expected hours are flown.
Reflecting customary seasonal weakness, the Fund's EBITDA was ($2.5)
million, similar to last year's EBITDA of ($2.4) million. Crew costs as well
as selling, general and administrative expenses increased by a combined amount
of $2.5 million, mainly due to the mobilization and operating costs of the
aircraft related to the DoD support contract. Net loss before non-controlling
interest was ($0.5) million, or ($0.04) per unit, compared with ($1.4)
million, or ($0.11) per unit, in the first quarter of 2008.
Cash flows from operating activities before net changes in non-cash
working capital balances were ($1.3) million, stable from the corresponding
period a year earlier. The Fund generated distributable cash of ($2.1)
million, or ($0.16) per unit, compared with ($3.5) million, or ($0.27) per
unit, last year, an increase essentially due to the lower net loss in
comparison with last year.
(in thousands of dollars, Quarters ended March 31,
except per unit data) 2009 2008
Revenue 26,479 24,999
EBITDA(1) (2,490) (2,357)
Net loss before non-controlling interest (505) (1,427)
Per unit - basic and diluted ($) (0.04) (0.11)
Distributable cash (2,069) (3,547)
Per unit - basic and diluted ($) (0.16) (0.27)
Weighted-average units outstanding
(including Class B) 13,098,700 13,280,000
(1) Earnings before interest, income taxes, depreciation and
amortization, gain or loss on disposal of property, plant and
equipment and non-controlling interest
The Fund ended the first quarter of 2009 in a strong financial position.
Cash and cash equivalents stood at $27.5 million following the sale to Ornge,
the provider of emergency aerial medical transportation to the province of
Ontario, of eleven Sikorsky S-76 helicopters and aviation assets for an
aggregate price of $30 million. Meanwhile, long-term debt was only $12.5
million, which was repaid in full in April 2009. With $15.0 million and $40
million currently available under its operating and term credit facilities,
respectively, the Fund maintains considerable financial resources.
"Significant positive business development events marked the early stages
of 2009 for Canadian Helicopters," said Jean-Pierre Blais, President of
Canadian Helicopters Income Fund. "We successfully completed the transfer of
certain flying assets to Ornge, which further strengthened our balance sheet,
and confirmed the extension to September 30, 2009 of our North Warning Systems
contracts with the U.S. Air Force. Our mandate in Afghanistan began late in
the quarter and has reached full operating capability. Finally, the
acquisition of a 49% interest in Heli-Welders Canada Ltd. brings further
diversification into a niche that is less seasonal and less dependent on
Certain of the Fund's operations are subject to seasonal fluctuations due
to variations in daylight hours and changes in weather conditions, with the
highest demand generally occurring from May to October. While some operations
are dependent on flight hours and are managed to mitigate the impact of
seasonality, a significant portion of operating costs, such as crew and fleet,
as well as selling, general and administrative expenses are fixed. Canadian
Helicopters takes advantage of the off-season period to conduct repairs and
maintenance on its helicopters and provide training to its crews in order to
minimize downtime during the peak season. This strategy, necessitated by
seasonality, significantly reduces profits during the quarters ending December
31 and March 31 and has historically resulted in losses. Therefore, results
for any single quarter may not be indicative of the results that may be
expected for the full year.
"While demand from the natural resources sector will be weaker this year,
our recent diversification initiatives, both abroad and domestically, will
temper our exposure to the sector. As a large proportion of our services are
essential in nature, and therefore less subject to extreme volatility of the
economy, we believe we remain well positioned to generate positive levels of
revenue and solid profits. Most importantly, our balance sheet remains
extremely solid and provides us with the capacity to aggressively pursue a
range of different opportunities for the benefit of our unitholders,"
concluded Mr. Blais.
Canadian Helicopters will hold its Annual Meeting of unitholders this
morning at 9:30 AM at the offices of McCarthy Tétrault LLP, 1000 de la
Gauchetiere West, 25th floor, Montreal.
Canadian Helicopters will hold a conference call to discuss these results
on Wednesday May 13, 2009 at 2:00 PM (EDT). Interested parties can join the
call by dialing 416-644-3420 (local) or 1-800-594-3615 (toll free). If you are
unable to call at this time, you may access a tape recording of the meeting by
calling 416-640-1917 (local) or 1-877-289-8525 (toll free) followed by access
code 21305144 followed by #. This tape recording will be available until
Wednesday, May 27, 2009.
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, military support, 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.
This press release contains forward-looking statements relating to the
future performance of the Fund. Forward-looking statements, specifically those
concerning future performance, are subject to certain risks and uncertainties,
and actual results may differ materially. Consequently, readers should not
place any undue reliance on such forward-looking statements. In addition,
these forward-looking statements relate to the date on which they were made.
The 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.
DEFINITION OF NON-GAAP MEASURES: EBITDA, STANDARDIZED DISTRIBUTABLE CASH
AND DISTRIBUTABLE CASH
References to "EBITDA" are to earnings (loss) before interest, income
taxes, depreciation and amortization, gain or loss on disposal of property,
plant and equipment and non-controlling interest, as disclosed in the Summary
of Selected Consolidated Financial Information.
Standardized Distributable Cash is a non-GAAP measure recommended by the
Canadian Institute of Chartered Accountants ("CICA") in order to provide a
consistent and comparable measurement of distributable cash across entities.
Standardized Distributable Cash represents cash flows from operating
activities, less adjustments for net maintenance capital expenditures as
reported in accordance with GAAP.
Management views Distributable Cash as an operating performance measure,
as it is a measure generally used by Canadian income funds as an indicator of
financial performance. Distributable Cash is defined as Standardized
Distributable Cash plus the net change in non-cash working capital balances
and less the consideration paid by the Fund for the purchase of Units under
the employee Unit purchase plan. Distributable Cash is important as it
summarizes the funds available for distribution to Unitholders.
EBITDA, Standardized Distributable Cash and Distributable Cash are not
earnings measures recognized under GAAP and do not have standardized meanings
prescribed by GAAP. Therefore, EBITDA, Standardized Distributable Cash and
Distributable Cash may not be comparable with similar measures presented by
other entities. Investors are cautioned that EBITDA, Standardized
Distributable Cash and Distributable Cash should not be construed as an
alternative to net earnings (loss) determined in accordance with GAAP as
indicators of the Fund's performance, or to cash flows from operating,
investing and financing activities as measures of liquidity and cash flows.
Note to readers: Complete consolidated unaudited interim financial
statements and Management's Discussion & Analysis of Operating Results
and Financial Position are available on Canadian Helicopters' website at
www.canadianhelicopters.com and on SEDAR at www.sedar.com.
For further information:
For further information: Jean-Pierre Blais, President, Canadian
Helicopters Income Fund, (450) 452-3007; Don Wall, Senior Executive
Vice-President, Canadian Helicopters Income Fund, (780) 429-6919