LAFAYETTE, La., March 8, 2010 (GLOBE NEWSWIRE) -- PHI, Inc. ("PHI") (Nasdaq:PHII) (voting) (Nasdaq:PHIIK) (non-voting) today reported financial results for the year ended December 31, 2009.
Oil and Gas segment revenues were $316.2 million and operating income was $51.3 million for the year ended December 31, 2009, compared to segment revenues of $324.1 million and operating income of $64.7 million for the year ended December 31, 2008. Segment revenues decreased by $7.9 million for 2009 compared to 2008. The decrease in Oil and Gas segment revenues and operating income was due to a decrease in medium aircraft revenue related primarily to a decrease in flight hour activity on the continental shelf and also due to a voluntary grounding of certain medium aircraft in the first quarter 2009, related to an accident on January 4, 2009. There were also decreases in revenue as a result of the completion of a foreign contract in 2008, and decreases in revenue related to fuel charges. These were offset in part by an increase in revenue for light and heavy aircraft in the Gulf of Mexico. Flight hours in the Oil and Gas segment were 111,527 for the year ended December 31, 2009, compared to 112,341 flight hours for the year ended December 31, 2008.
Air Medical segment revenues were $160.1 million and operating income was $6.0 million for the year ended December 31, 2009, compared to segment revenues of $174.7 million and operating income of $5.1 million for the year ended December 31, 2008. Segment revenues decreased by $14.6 million for 2009 compared to 2008. The decrease in Air Medical segment operating revenues was due to decreased patient transports in the independent provider programs, which we believe is primarily attributable to the current economic environment. Also contributing to the decrease was the closure of six bases that were generating less than acceptable transport volumes. The improvement in Air Medical operating income was due to reductions in cost, but also due to a pre-tax credit of $3.6 million related to termination of a manufacturer's warranty program. Flight hours in the Air Medical segment were 33,483 for the year ended December 31, 2009, compared to 36,732 flight hours for the year ended December 31, 2008. Patient transports were 19,798 for 2009 compared to 22,647 for 2008.
Technical Services revenues were $10.9 million and operating income was $3.6 million for the year ended December 31, 2009, compared to segment revenues of $10.6 million and operating income of $3.7 million for the year ended December 31, 2008.
Consolidated operating revenues were $487.2 million and earnings before income taxes were $21.8 million for the year ended December 31, 2009, compared to operating revenues of $509.5 million and earnings before income taxes of $38.6 million for the year ended December 31, 2008. Operating revenues decreased by $22.3 million year to year. Earnings for the year ended December 31, 2009 included a pre-tax credit of $4.9 million related to the termination of the warranty program for certain aircraft and a $2.1 million pre-tax insurance provision. Earnings for the year ended December 31, 2008 included a pre-tax credit of $1.6 million for termination of a warranty program for certain aircraft, a $4.5 million pre-tax gain on disposition of assets, an aggregate pre-tax insurance charge of $2.1 million, and a non-cash pre-tax charge for impairment of goodwill of $2.7 million. The remaining decrease in earnings before tax is due to the decrease in Oil and Gas segment operating income due to the decrease in flight hour activity on the continental shelf and the voluntary grounding of certain medium aircraft in the first quarter 2009 related to an accident on January 4, 2009, and due to completion of a foreign contract in 2008. Our net income for the year ended December 31, 2009 was $13.0 million, or $0.85 per diluted share, compared to $23.5 million, or $1.54 per diluted share, for the year ended December 31, 2008.
Flight hours for the year ended December 31, 2009 were 146,314, compared to 150,686 for the year ended December 31, 2008.
The year 2009 was a challenging time for PHI, as there was a decrease in flight hour activity in our Oil and Gas segment, particularly on the continental shelf, and a decrease in patient transport activity in our Air Medical segment as a result of the unfavorable economic conditions this year. Weather has also had a negative impact on all our operations, particularly in the fourth quarter. We encountered much more unfavorable weather conditions in the fourth quarter 2009 as compared to prior years.
There were a number of contract awards since December 31, 2009, in our Oil and Gas segment. One award was a five year contract from an existing customer commencing June 2011 upon the expiration of the current contract. There were also seven other contract awards from existing customers, each with terms that are from three to five years. These contract awards commence in the first quarter 2010. The above awards are for a minimum of 20 light, 17 medium, and three heavy aircraft.
Additionally, our Air Medical segment was awarded two new traditional hospital contracts, with terms on one being ten years and the second contract term being three years. Additionally, we were awarded a new three year contract on an independent provider model format but which includes certain revenue guarantees. These contracts represent incremental revenues.
These items are more fully discussed in our Form 10-K.
Certain statements in this release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "forecast," "anticipate," "estimate," "project," "intend," "expect," "should," "believe," and similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause the Company's actual results, performance (financial or operating) or achievements to differ materially from the results, performance (financial or operating) or achievements expressed or implied by such forward-looking statements. These factors include adverse weather, competition, the level of activity in the oil and gas industry (particularly in the Gulf of Mexico) and our ability to continue to grow patient transport volumes. These and other factors are more fully discussed in the Company's SEC filings under "Risk Factors."
PHI provides helicopter transportation and related services to a broad range of customers including the oil and gas industry, air medical industry and also provides third-party maintenance services to select customers. PHI Voting Common Stock and Non-Voting Common Stock are traded on The Nasdaq Global Market (symbols PHII and PHIIK).
| PHI, INC. AND SUBSIDIARIES | |||
| Condensed Consolidated Statements of Operations | |||
| (Thousands of dollars and shares, except per share data) | |||
|
Year Ended December 31, 2009 |
Year Ended December 31, 2008 |
Year Ended December 31, 2007 |
|
| Operating revenues, net | $487,175 | $509,514 | $446,406 |
| Gain on disposition of assets, net | 111 | 4,468 | 34,953 |
| Other, principally interest income | 225 | 522 | 5,098 |
| 487,511 | 514,504 | 486,457 | |
| Expenses: | |||
| Direct expenses | 418,627 | 425,953 | 394,421 |
|
Selling, general and administrative expenses |
31,006 | 31,657 | 30,226 |
| Interest expense | 16,037 | 15,515 | 16,121 |
| Goodwill impairment charges | -- | 2,747 | -- |
| 465,670 | 475,872 | 440,768 | |
| Earnings before income taxes | 21,841 | 38,632 | 45,689 |
| Income tax expense | 8,873 | 15,117 | 17,471 |
| Net earnings | $12,968 | $23,515 | $28,218 |
| Earnings per share: | |||
| Basic | $0.85 | $1.54 | $1.85 |
| Diluted | $0.85 | $1.54 | $1.85 |
| Weighted average shares outstanding: | |||
| Basic | 15,307 | 15,295 | 15,279 |
| Diluted | 15,307 | 15,301 | 15,288 |
Summarized financial information concerning the Company's reportable operating segments for the years ended December 31, 2009, 2008, and 2007:
|
Year Ended December 31, |
|||
| 2009 | 2008 | 2007 | |
| (Thousands of dollars) | |||
| Segment operating revenues | |||
| Oil and Gas | $316,198 | $324,147 | $286,118 |
| Air Medical | 160,113 | 174,739 | 149,590 |
| Technical Services | 10,864 | 10,628 | 10,698 |
| Total operating revenues | 487,175 | 509,514 | 446,406 |
| Segment direct expenses | |||
| Oil and Gas | 263,818 | 258,160 | 250,110 |
| Air Medical | 147,630 | 160,910 | 137,703 |
| Technical Services | 7,179 | 6,883 | 6,608 |
| Total direct expenses | 418,627 | 425,953 | 394,421 |
| Segment selling, general and administrative expenses | |||
| Oil and Gas | 1,075 | 1,335 | 1,531 |
| Air Medical | 6,484 | 8,716 | 7,883 |
| Technical Services | 51 | 76 | 59 |
| Total selling, general and administrative expenses | 7,610 | 10,127 | 9,473 |
| Total segment direct and selling, general and administrative expenses | 426,237 | 436,080 | 403,894 |
| Net segment profit | |||
| Oil and Gas | 51,305 | 64,652 | 34,477 |
| Air Medical | 5,999 | 5,113 | 4,004 |
| Technical Services | 3,634 | 3,669 | 4,031 |
| Total | 60,938 | 73,434 | 42,512 |
| Other, net | 336 | 4,990 | 40,051 |
| Unallocated selling, general and administrative expenses | (23,396) | (21,530) | (20,753) |
| Interest expense | (16,037) | (15,515) | (16,121) |
| Goodwill impairment charge | -- | (2,747) | -- |
| Earnings before income taxes | $21,841 | $38,632 | $45,689 |
| Flight hours | |||
| Oil and Gas | 111,527 | 112,341 | 107,812 |
| Air Medical | 33,483 | 36,732 | 31,341 |
| Technical Services | 1,304 | 1,613 | 1,216 |
| Total | 146,314 | 150,686 | 140,369 |
| Air Medical Transports | 19,798 | 22,647 | 21,710 |
| Aircraft operated at period end | |||
| Oil and Gas | 164 | 153 | 156 |
| Air Medical | 85 | 90 | 77 |
| Technical Services | 6 | 6 | 4 |
| Total | 255 | 249 | 237 |