TORONTO, June 13, 2013 /CNW/ - Discovery Air Inc. (the "Corporation") announced its financial and operating results for the quarter ended April 30, 2013. The first quarter interim condensed 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 April 30|
|(thousands of dollars, except per share amounts)||2013||2012|| %
|Basic and diluted earnings (loss) per common share||$||(0.60)||$||0.09||-767%|
|Adjusted Profit (loss)*||$||(8,804)||$||(773)||-1039%|
|Basic and diluted adjusted earnings (loss) per common share||$||(0.60)||$||(0.05)||-1100%|
|Cash from operations||$||(13,468)||$||(5,500)||-145%|
|* See "Non-IFRS measures" below|
- While the Corporation experienced its second highest first quarter revenue in its history, revenues for the first quarter decreased by 18% from record levels recorded in the comparative period. The decrease in revenues was largely attributable to lower flight hour demand for airborne training and a decline in activity from the resource-based customers. Aviation segment revenues of $35.1 million (a 26% decline over the comparative period) were further impacted by poor weather conditions and competitive pressures in the fixed wing business in the north. Corporate Support and Other segment revenues were $8.5 million, a 61% increase over the comparative period on increased MRO activity.
- The current quarter EBITDA loss was $2.2 million compared to an EBITDA profit of $8.9 million reported in the comparative period. The lower EBITDA reflects lower flight hour activity at Discovery Air Defence Services that was below the previous period due to the timing of training exercises. Similarly, the Corporation's operations in northern Canada performed below prior period results on significantly lower demand from mining and oil & gas customers. Northern Air Support Ltd. was acquired in May 2012, and as a result, its carrying costs through the first quarter, its traditionally slower period, are not reflected in the prior period results. Finally, unfavourable weather conditions affected results through much of the first quarter. EBITDA results for the comparative quarter reflected a very different picture. In the first quarter of fiscal 2013, EBITDA was at record levels, far exceeding those reported in previous years, due to increased demand for airborne training and special mission services, increased helicopter revenues from oil and gas and mining customers and a successful first quarter for Helicopters.cl SpA, based in Chile, following its acquisition on February 2, 2012.
- The Corporation recorded a quarterly loss of $8.8 million ($0.60 loss per share - basic and diluted) compared to a profit of $1.4 million ($0.09 earnings per share - basic and diluted) in the comparative period. The comparative period earnings reflect a tax-effected gain of $1.9 million on extinguishment of debt and a $0.2 million gain related to a change in the fair value of the Corporation's embedded derivative that existed up to March 26, 2012. Excluding these items, the comparative period reflects an adjusted loss of $0.8 million ($0.05 loss per share - basic and diluted).
Commenting on the financial results, Jacob Shavit, the Corporation's President and Chief Executive Officer stated, "Our first quarter results were disappointing. We expect that lower airborne training hours are timing related and not reflective of full year expectations. However, there has been a meaningful decline in resource-based activity, which could continue to affect a number of our businesses."
"While our first quarter results were below expectations, the upcoming second and third quarters represent our peak period for activity. We are actively pursuing all additional revenue and cost reduction opportunities and will respond quickly to any further changes in market conditions that affect our businesses," added Mr. Shavit.
A conference call with analysts and other interest parties to review results of the first quarter of fiscal 2014 will be held on Friday, June 14, 2013 at 12:00 p.m. (Eastern Time). The conference call may be attended by calling 1-888-231-8191. Please dial in 15 minutes prior to the call start time to secure a line. The conference call will be archived for replay approximately three hours following its conclusion on Discovery Air's website at www.discoveryair.com/investors.
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 Management's Discussion and Analysis for the year ended January 31, 2013 and the first quarter ended April 30, 2013, 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 unaudited interim condensed consolidated financial statements and MD&A for the first quarter ended April 30, 2013, 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 unaudited interim condensed consolidated financial statements and MD&A for the quarter ended April 30, 2013 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.
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, impairment losses, and gains and losses resulting from the change in fair value of financial liabilities. The EBITDA margin is EBITDA as a percentage of revenue. Management believes EBITDA is an important measure as it excludes the effects of items which primarily reflect the impact of long-term investment decisions from the results of the Corporation's day-to-day operations. "Adjusted profit (loss)" is net profit (loss) attributable to shareholders of Discovery Air Inc. excluding non-cash gain on extinguishment of debt gains and losses on disposal of property and equipment, gains on acquisitions, and gains and losses resulting from the change in fair value of financial liabilities and impairment loss, net of taxes. Management believes these measurements are useful in assessing the Corporation's ability to service debt and to meet other payment obligations, and as a basis for valuation.
SOURCE: Discovery Air Inc.
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