Bristow Group Inc

General

Our ongoing liquidity requirements arise primarily from working capital needs, meeting our capital commitments (including the purchase of aircraft and other equipment) and the payment of debt service obligations. In addition, we may use our liquidity to fund acquisitions, repurchase stock or debt securities or make other investments. Our primary sources of liquidity are cash balances and cash flows from operations and, from time to time, we may obtain additional liquidity through the issuance of equity or debt or other financing options or through asset sales.

Summary of Cash Flows

Operating Activities

Cash flows provided by operating activities were $84.8 million higher in the Current Year primarily due to an increase in operating income before depreciation and gains (losses) on asset dispositions. Working capital uses of $10.1 million in the Current Year were primarily due to increases in inventory to support new contracts and to mitigate risks related to supply chain constraints. Working capital changes of $3.5 million in the Prior Year were primarily due to increased accrued liabilities, partially offset by increased inventories and accounts receivables.

Investing Activities

During the Current Year, net cash used in investing activities was $167.4 million primarily consisting of:

•Capital expenditures of $171.9 million primarily related to payments for aircraft, purchases of equipment and leasehold improvements, and

•Proceeds of $4.5 million primarily from the sale of aircraft and other assets.

During the Prior Year, net cash used in investing activities was $28.0 million primarily consisting of:

•Capital expenditures of $62.1 million primarily related to payments for aircraft, purchases of equipment and leasehold improvements, and

•Proceeds of $34.1 million primarily from the sale or disposal of aircraft and other assets.

Financing Activities

During the Current Year, net cash provided by financing activities was $63.3 million primarily consisting of:

•Proceeds from borrowings of $82.3 million, partially offset by

•Net repayments of debt of $11.5 million primarily related to the principal of secured equipment term loans,

•Stock repurchases of $4.1 million, and

•Payments on debt issuance costs of $3.5 million.

During the Prior Year, net cash provided by financing activities was $25.3 million primarily consisting of:

•Proceeds from borrowings of $169.5 million, partially offset by

•Net repayments of debt of $138.7 million primarily related to the principal of secured equipment term loans,

•Payments on debt issuance costs of $2.7 million, and

•Stock repurchases of $2.7 million.

Effect of Exchange Rate Changes

The effect of exchange rate changes on cash and cash equivalents denominated in currencies other than the reporting currency are reflected in a separate line on the condensed consolidated statement of cash flows. Through our foreign operations we are exposed to currency fluctuations, and changes in the value of the GBP and Norwegian krone relative to the U.S. dollar have the most significant impacts to the effect of exchange rate changes on our cash, cash equivalents and restricted cash.

Material Cash Requirements

The factors that materially affect our overall liquidity include cash from or used to fund operations, capital expenditure commitments, debt service, pension funding, adequacy of bank lines of credit and our ability to attract capital on satisfactory terms. We believe that our cash flows from operating activities will be adequate to meet our working capital requirements. To support our capital expenditure program and/or other liquidity requirements, we may use any combination of operating cash flows, unrestricted cash balances, borrowings under our ABL Facility, proceeds from sales of assets, issue debt or equity, or other financing options.

As of September 30, 2024, approximately 84% of our total cash balance was held outside the U.S. Most of our cash held outside the U.S. could be repatriated to the U.S., and any such repatriation could be subject to additional taxes. If cash held by non-U.S. operations is required for funding operations in the U.S., we may make a provision for additional taxes in connection with repatriating this cash, which is not expected to have a significant impact on our results of operations.

We have no near-term debt maturities, other than the current portion of long-term debt of $16.9 million, and believe that our cash flows from operations and other sources of liquidity will continue to be sufficient in fulfilling our capital requirements and other obligations. Our long-term liquidity is dependent upon our ability to generate operating profits sufficient to meet our requirements for working capital, debt service obligations, capital expenditures and a reasonable return on investment. As of September 30, 2024, we had $200.3 million of unrestricted cash and $59.6 million of remaining availability under our ABL Facility for total liquidity of $259.9 million.

In January 2024, we entered into a long-term equipment financing to upsize the UKSAR Debt by an aggregate amount of up to £55 million. As of September 30, 2024, we had drawn approximately £26.1 million under this facility.

In June 2024, we entered into a long-term equipment financing for an aggregate amount of up to €100.0 million with National Westminster Bank Plc as the original lender and UK Export Finance guaranteeing 80% of the facility (“IRCG Debt”, formerly known as “UKEF Debt”). As of September 30, 2024, we had drawn approximately €46 million under this facility.

As of September 30, 2024, our total principal debt balance, net of deferred financing fees, was $629.1 million, primarily comprised of the 6.875% Senior Notes due in March 2028 and the UKSAR Debt and IRCG Debt maturing in March 2036 and July 2031, respectively.

We plan to use a combination of cash on hand, operating cash flows, new debt financing and aircraft leasing to fund our projected future capital expenditures, which includes our aircraft purchase commitments, infrastructure and other growth expenditure plans, primarily in support of new long-term contracts such as the UKSAR2G and IRCG, among other growth opportunities.

Contractual Obligations and Commercial Commitments

We have various contractual obligations that are recorded as liabilities on our consolidated balance sheets. Other items, such as certain purchase commitments and other executory contracts, are not recognized as liabilities on our consolidated balance sheets.

As of September 30, 2024, we had unfunded capital commitments of $289.3 million, consisting primarily of agreements to purchase ten AW189 heavy helicopters, three AW139 medium helicopters, five AW169 light twin helicopters and five H135 light twin helicopters. The AW189 helicopters are scheduled to be delivered between 2024 and 2026; the AW139 helicopters are scheduled to be delivered in 2024; and the H135 helicopters are scheduled to be delivered between 2024 and 2025. Delivery dates for the AW169 helicopters have yet to be determined. In addition, the Company has outstanding options to purchase up to 10 additional AW189 helicopters and 10 additional H135 helicopters. If these options are exercised, the AW189 helicopters would be scheduled for delivery between 2026 and 2028, and the H135 helicopters would be scheduled for delivery between 2027 and 2028. The Company may, from time to time, purchase aircraft for which it has no orders.

As of September 30, 2024, $35.2 million of our unfunded capital commitments may be terminated without further liability other than aggregate liquidated damages of approximately $1.1 million. If we do not exercise our rights to cancel these capital commitments, we expect to finance the remaining acquisition costs for these helicopters through a combination of cash on hand, cash provided by operating activities, asset sales and financing options.

Lease Obligations

From time to time, we may, under favorable market conditions and when necessary, enter into opportunistic aircraft lease agreements in support of our global operations.

We have non-cancelable operating leases in connection with the lease of certain equipment, including leases for aircraft, and land and facilities used in our operations. The related lease agreements, which range from non-cancelable to month-to-month terms, generally provide for fixed monthly rentals and can also include renewal options. As of September 30, 2024, aggregate undiscounted future payments under all non-cancelable operating leases that have initial or remaining terms in excess of one year were as follows (in thousands):

Selected Financial Information on Guarantors of Securities

On February 25, 2021, Bristow Group Inc. (the “Parent”) issued its 6.875% Senior Notes due 2028. The 6.875% Senior Notes, issued under an indenture, are fully and unconditionally guaranteed as to payment by a number of subsidiaries of the Parent (collectively, the “Guarantors”). The Parent is a holding company with no significant assets other than the stock of its subsidiaries. In order to meet its financial needs and obligations, the Parent relies exclusively on income from dividends and other cash flow from such subsidiaries. The subsidiary guarantees provide that, in the event of a default on the 6.875% Senior Notes, the holders of the 6.875% Senior Notes may institute legal proceedings directly against the Guarantors to enforce the guarantees without first proceeding against the Parent.

None of the non-Guarantor subsidiaries of the Parent are under any direct obligation to pay or otherwise fund amounts due on the 6.875% Senior Notes or the guarantees, whether in the form of dividends, distributions, loans or other payments. If such subsidiaries are unable to transfer funds to the Parent or Guarantors and sufficient cash or liquidity is not otherwise available, the Parent or Guarantors may not be able to make principal and interest payments on their outstanding debt, including the 6.875% Senior Notes or the guarantees. The following selected financial information of the Guarantors presents a sufficient financial position of the Parent to continue to fulfill its obligations under the requirements of the 6.875% Senior Notes. This selected financial information should be read in conjunction with the accompanying consolidated financial statements and notes (in thousands).