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News Release

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Bristow Group Reports Fiscal 2009 First Quarter Financial Results

HOUSTON, Aug. 6 /PRNewswire-FirstCall/ -- Bristow Group Inc. (NYSE: BRS) today reported financial results for its fiscal 2009 first quarter ended June 30, 2008.

Highlights include:

  • Revenue increased 23% versus the June 2007 quarter to $284.1 million. Revenue gains occurred primarily in our Europe, West Africa and Southeast Asia business units, driven in large part by the addition of new aircraft and improved pricing, as well as the effect of a reorganization of our Mexico operations discussed below.


  • Operating income increased 10% to $31.6 million from $28.8 million in the June 2007 quarter as a result of improved rates, gains from asset disposals and the effect of the Mexico reorganization, partially offset by higher maintenance costs within our Eastern Hemisphere ("EH") Centralized Operations business unit.


  • Income from continuing operations increased to $22.6 million from $21.9 million in the June 2007 quarter as a result of increased operating income, earnings from unconsolidated affiliates and other income (expense), net, which primarily resulted from the Mexico reorganization, partially offset by an increase in interest expense resulting from the debt offerings last fiscal year and in June 2008.


  • Diluted earnings per share from continuing operations decreased slightly to $0.72 from $0.73 in the June 2007 quarter, while diluted earnings per share on net earnings decreased to $0.72 from $0.75 in the June 2007 quarter.


  • The largest factors affecting financial results were the favorable impact of the Mexico reorganization offset by the negative impact from our EH Centralized Operations and the dilution resulting from the June 2008 sale of common stock and convertible senior notes.
    • The Mexico reorganization included the restructuring of our ownership interests such that we now own 70% (up from 49%) of one affiliate ("RLR") and 24% (down from 49%) of another ("Heliservicio"), which resulted in several changes effective April 1, 2008, including the consolidation of RLR, return to the accrual basis of accounting for revenue recognition with Heliservicio and application of the equity method of accounting to our investment in Heliservicio. The Mexico reorganization impacted financial results as follows:
      • Increased operating income by $0.8 million,
      • Increased income from continuing operations by $3.7 million,
      • Increased diluted earnings per share by $0.12.
  • EH Centralized Operations experienced significantly higher maintenance costs primarily due to (a) foreign currency movements as a portion of our third-party maintenance contracts are denominated in euros, (b) an increase in heavy maintenance activities and (c) a reduction in the carrying value of obsolete inventory, which impacted financial results as follows:
    • Reduced operating income by $6.9 million,
    • Reduced income from continuing operations by $4.5 million,
    • Reduced diluted earnings per share by $0.14.
  • In June 2008 we completed the sale of 4,996,900 shares of common stock and $115 million of convertible senior notes, which had the effect of reducing diluted earnings per share by $0.01 for the June 2008 quarter.

Sale of Certain Single-engine Aircraft

As separately announced today, we executed an agreement to sell 53 single-engine aircraft and related assets operating in the U.S. Gulf of Mexico for $65 million. The sale, which is expected to close by September 30, 2008, is anticipated to result in a pre-tax gain of roughly $40 million or $0.75 per diluted share, after tax. The closing is contingent upon several items being completed, including the buyer obtaining financing, customer consent of affected commercial contracts, regulatory clearance and other customary conditions.

Capital and Liquidity:

  • At June 30, 2008 we continued to have a strong balance sheet, which allows us the financial flexibility to take advantage of growth opportunities:
    • $1.2 billion in stockholders' investment and $734.1 million of indebtedness
    • $527.4 million in cash and $100 million undrawn revolving credit facility
    • Aircraft purchase commitments totaled $389.6 million for 39 aircraft, with options totaling $862.8 million for 51 aircraft.
  • During the June 2008 quarter, we generated strong cash flows, including:
    • $29.6 million of cash from operating activities
    • $335.9 million in net proceeds from the sale of convertible senior notes and common stock
    • We used $130.8 million for capital expenditures - primarily for aircraft.

CEO Remarks:

"Our strong revenue increase this quarter reflects continued growth by both the addition of new aircraft and improved pricing," said William E. Chiles, President and Chief Executive Officer of Bristow Group Inc.

"In June, we secured additional financing to execute our growth plans for the next several years through an offering of common stock and convertible senior notes. Although oil and natural gas prices have come off their historic highs in recent weeks, we continue to expect customer demand to exceed the supply of high-quality helicopters that customers want most over the next several years. That's why Bristow chose to raise new capital and remains well positioned with manufacturers for new helicopters, which will ensure that we can take advantage of these strong market conditions."

CONFERENCE CALL

Management will conduct a conference call starting at 10:00 a.m. EDT (9:00 a.m. CDT) on Wednesday, August 6, 2008, to review financial results for the fiscal 2009 first quarter ended June 30, 2008. The conference call can be accessed as follows:

Via Webcast:

  • Visit Bristow Group's investor relations Web page at http://www.bristowgroup.com
  • Live: Click on the link for "Q1 2009 Bristow Group Inc. Earnings Conference Call"
  • Replay: A replay via webcast will be available approximately one hour after the call's completion

Via Telephone within the U.S.:

  • Live: Dial toll free (800) 218-0204
  • Replay: A telephone replay will be available through Wednesday, August 20, by dialing toll free (800) 405-2236, passcode: 11116476#

Via Telephone outside the U.S.:

  • Live: Dial (303) 262-2137
  • Replay: A telephone replay will be available through Wednesday, August 20, by dialing (303) 590-3000, passcode: 11116476#

ABOUT BRISTOW GROUP INC.

Bristow Group Inc. is the leading provider of helicopter services to the worldwide offshore energy industry based on the number of aircraft operated. Through its subsidiaries, affiliates and joint ventures, the Company has major transportation operations in most of the major offshore oil and gas producing regions of the world, including in the North Sea, the U.S. Gulf of Mexico, Nigeria and Australia. For more information, visit the Company's website at http://www.bristowgroup.com.

FORWARD-LOOKING STATEMENTS DISCLOSURE

Statements contained in this news release that state the Company's or management's intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements. These forward-looking statements include statements regarding customer demand, supply of helicopters and growth opportunities. It is important to note that the Company's actual results could differ materially from those projected in such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company's SEC filings, including but not limited to the Company's quarterly report on Form 10-Q for the quarter ended June 30, 2008 and the annual report on Form 10-K for the fiscal year ended March 31, 2008. Bristow Group Inc. disclaims any intention or obligation to revise any forward-looking statements, including financial estimates, whether as a result of new information, future events or otherwise.

     Linda McNeill, Investor Relations
     (713) 267-7622

                          (financial tables follow)



                     BRISTOW GROUP INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF INCOME
                   (In thousands, except per share amounts)
                                 (Unaudited)

                                                       Three Months Ended
                                                            June 30,
                                                    -----------------------
                                                      2007           2008
                                                    --------       --------
    Gross revenue:
      Operating revenue from non-affiliates         $199,909       $241,134
      Operating revenue from affiliates               11,097         17,270
      Reimbursable revenue from non-affiliates        19,042         24,371
      Reimbursable revenue from affiliates             1,103          1,348
                                                    --------       --------
                                                     231,151        284,123
                                                    --------       --------

    Operating expense:
      Direct cost                                    153,088        186,973
      Reimbursable expense                            20,145         26,067
      Depreciation and amortization                   11,331         14,955
      General and administrative                      18,385         27,206
      Gain on disposal of assets                        (584)        (2,665)
                                                    --------       --------
                                                     202,365        252,536
                                                    --------       --------
        Operating income                              28,786         31,587
    Earnings from unconsolidated affiliates, net
     of losses                                         3,390          7,723
    Interest income                                    2,124          1,447
    Interest expense                                  (2,928)        (8,493)
    Other income (expense), net                          426          1,692
                                                    --------       --------
        Income from continuing operations before
         provision for income taxes and minority
         interest                                     31,798         33,956
    Provision for income taxes                        (9,439)       (10,604)
    Minority interest                                   (449)          (703)
                                                    --------       --------
        Income from continuing operations             21,910         22,649
    Discontinued operations:
        Income from discontinued operations before
         provision for income taxes                    1,157             --
        Provision for income taxes on discontinued
         operations                                     (395)            --
                                                    --------       --------
        Income (loss) from discontinued operations       762             --
                                                    --------       --------
        Net income                                    22,672         22,649
        Preferred stock dividends                     (3,162)        (3,162)
                                                    --------       --------
        Net income available to common
         stockholders                                $19,510        $19,487
                                                    ========       ========
    Basic earnings per common share:
    Earnings from continuing operations                $0.80          $0.78
      Earnings (loss) from discontinued operations      0.03             --
                                                    --------       --------
      Net earnings                                     $0.83          $0.78
                                                    ========       ========
    Diluted earnings per common share:
      Earnings from continuing operations              $0.73          $0.72
      Earnings (loss) from discontinued operations      0.02             --
                                                    --------       --------
      Net earnings                                     $0.75          $0.72
                                                    ========       ========



                     BRISTOW GROUP INC. AND SUBSIDIARIES
                         CONSOLIDATED BALANCE SHEETS
                                (In thousands)

                                                    March 31,      June 30,
                                                      2008           2008
                                                  ----------     ----------
                                                                 (Unaudited)
                                    ASSETS
    Current assets:
      Cash and cash equivalents                     $290,050       $527,432
      Accounts receivable from non-affiliates        204,599        199,588
      Accounts receivable from affiliates             11,316         22,023
      Inventories                                    176,239        175,458
      Prepaid expenses and other                      24,177         32,732
                                                  ----------     ----------
        Total current assets                         706,381        957,233
    Investment in unconsolidated affiliates           52,467         35,358
    Property and equipment - at cost:
      Land and buildings                              60,056         60,784
      Aircraft and equipment                       1,428,996      1,585,188
                                                  ----------     ----------
                                                   1,489,052      1,645,972
      Less - Accumulated depreciation and
       amortization                                 (316,514)      (326,842)
                                                  ----------     ----------
                                                   1,172,538      1,319,130
    Goodwill                                          15,676         16,590
    Other assets                                      30,293         26,967
                                                  ----------     ----------
                                                  $1,977,355     $2,355,278
                                                  ==========     ==========

                     LIABILITIES AND STOCKHOLDERS' INVESTMENT
    Current liabilities:
      Accounts payable                               $49,650        $54,508
      Accrued wages, benefits and related taxes       35,523         29,445
      Income taxes payable                             5,862            836
      Other accrued taxes                              1,589          3,172
      Deferred revenues                               15,415         15,652
      Accrued maintenance and repairs                 13,250         13,571
      Accrued interest                                 5,656          8,604
      Other accrued liabilities                       22,235         14,277
      Deferred taxes                                   9,238         12,303
      Short-term borrowings and current maturities
       of long-term debt                               6,541          7,692
                                                  ----------     ----------
        Total current liabilities                    164,959        160,060
    Long-term debt, less current maturities          599,677        726,432
    Accrued pension liabilities                      134,156        132,810
    Other liabilities and deferred credits            14,805         14,775
    Deferred taxes                                    91,747        102,320
    Minority interest                                  4,570         10,254
    Commitments and contingencies
    Stockholders' investment:
      5.50% mandatory convertible preferred stock    222,554        222,554
      Common stock                                       239            291
      Additional paid-in capital                     186,390        413,228
      Retained earnings                              606,931        627,673
      Accumulated other comprehensive loss           (48,673)       (55,119)
                                                  ----------     ----------
                                                     967,441      1,208,627
                                                  ----------     ----------
                                                  $1,977,355     $2,355,278
                                                  ==========     ==========



                     BRISTOW GROUP INC. AND SUBSIDIARIES
                           SELECTED OPERATING DATA
             (In thousands, except flight hours and percentages)
                                 (Unaudited)

                                                       Three Months Ended
                                                            June 30,
                                                    -----------------------
                                                       2007           2008
                                                    --------       --------
    Flight hours (excludes Bristow Academy and
     unconsolidated affiliates):
      U.S. Gulf of Mexico                             37,868         37,639
      Arctic                                           2,403          2,437
      Latin America                                   11,367          9,064
      Europe                                          10,821         10,306
      West Africa                                      8,898          9,598
      Southeast Asia                                   3,344          4,882
      Other International                              2,547          2,053
                                                    --------       --------
        Consolidated total                            77,248         75,979
                                                    ========       ========

    Gross revenue:
      U.S. Gulf of Mexico                            $55,428        $61,509
      Arctic                                           4,357          4,243
      Latin America                                   16,036         20,206
      WH Centralized Operations                        1,154          2,260
      Europe                                          83,357         95,430
      West Africa                                     33,283         43,300
      Southeast Asia                                  22,492         36,880
      Other International                             11,455         13,021
      EH Centralized Operations                        6,805          8,837
      Bristow Academy                                  3,019          6,151
      Intrasegment eliminations                       (6,235)        (7,746)
      Corporate                                           --             32
                                                    --------       --------
        Consolidated total                          $231,151       $284,123
                                                    ========       ========

    Operating income (loss):
      U.S. Gulf of Mexico                             $9,099         $7,989
      Arctic                                             675            519
      Latin America                                    3,334          6,475
      WH Centralized Operations                        1,292           (676)
      Europe                                          14,575         17,476
      West Africa                                      2,797          6,516
      Southeast Asia                                   4,127          4,186
      Other International                              2,265          1,197
      EH Centralized Operations                       (4,279)        (7,921)
      Bristow Academy                                    (91)           546
      Gain on disposal of assets                         584          2,665
      Corporate                                       (5,592)        (7,385)
                                                    --------       --------
        Consolidated total                           $28,786        $31,587
                                                    ========       ========

    Operating margin:
      U.S. Gulf of Mexico                               16.4%          13.0%
      Arctic                                            15.5%          12.2%
      Latin America                                     20.8%          32.0%
      Europe                                            17.5%          18.3%
      West Africa                                        8.4%          15.0%
      Southeast Asia                                    18.3%          11.4%
      Other International                               19.7%           9.2%
      Bristow Academy                                   (3.0)%          8.9%
        Consolidated total                              12.5%          11.1%


Beginning with our reporting for the three months ended June 30, 2008, our North America business unit has been segregated into three separate business units: U.S. Gulf of Mexico, Arctic and WH Centralized Operations. Amounts presented for the prior period presented herein have been reclassified to conform to current period presentation. Further, our South and Central America business unit has been renamed the Latin America business unit. In addition to selected operating data for the three month ended June 30, 2007 and 2008, we have presented in the tables below selected operating data for the quarters ended September 30, 2007, December 31, 2007 and March 31, 2008 based on the new segment presentation.



                     BRISTOW GROUP INC. AND SUBSIDIARIES
                           SELECTED OPERATING DATA
             (In thousands, except flight hours and percentages)
                                 (Unaudited)

                       -----------------------------------------------------
                                        Three Months Ended
                       -----------------------------------------------------
                        June 30,  Sept. 30,   Dec. 31,  March 31, June 30,
                          2007       2007      2007       2008      2008
                       --------   --------   --------   --------  --------
    Flight hours
     (excludes
     Bristow
     Academy and
     unconsolidated
     affiliates):
      U.S. Gulf of
       Mexico            37,868     36,621     33,431     32,018    37,639
      Arctic              2,403      3,002      1,227      1,232     2,437
      Latin America      11,367     10,810     10,417      7,845     9,064
      Europe             10,821     11,494     11,625     10,403    10,306
      West Africa         8,898      9,887      9,824      9,561     9,598
      Southeast Asia      3,344      3,644      4,590      4,451     4,882
      Other
       International      2,547      2,177      2,120      1,886     2,053
                       --------   --------   --------   --------  --------
        Consolidated
         total           77,248     77,635     73,234     67,396    75,979
                       ========   ========   ========   ========  ========

    Gross Revenue:
      U.S. Gulf of
       Mexico           $55,428    $55,948    $53,259    $54,664   $61,509
      Arctic              4,357      5,290      2,570      2,037     4,243
      Latin America      16,036     16,951     16,476     14,400    20,206
      WH Centralized
       Operations         1,154        821      1,438        692     2,260
      Europe             83,357     93,459     95,100     89,828    95,430
      West Africa        33,283     45,799     46,287     45,401    43,300
      Southeast Asia     22,492     23,858     29,918     34,849    36,880
      Other
       International     11,455     12,046     11,874     12,143    13,021
      EH Centralized
       Operations         6,805      5,331      5,239      4,991     8,837
      Bristow Academy     3,019      3,228      3,969      4,571     6,151
      Intrasegment
       eliminations      (6,235)    (2,923)    (4,647)    (3,390)   (7,746)
      Corporate              --         --         37         99        32
                       --------   --------   --------   --------  --------
        Consolidated
         total         $231,151   $259,808   $261,520   $260,285  $284,123
                       ========   ========   ========   ========  ========

    Operating income
     (loss):
      U.S. Gulf of
       Mexico            $9,099     $9,680     $8,122     $7,230    $7,989
      Arctic                675      1,440        (72)      (281)      519
      Latin America       3,334      4,250      3,828      2,205     6,475
      WH Centralized
       Operations         1,292         71       (871)    (2,591)     (676)
      Europe             14,575     21,895     20,695     20,183    17,476
      West Africa         2,797     15,492      7,019      6,633     6,516
      Southeast Asia      4,127      5,107      6,476      8,044     4,186
      Other
       International      2,265      1,781        712     (5,041)    1,197
      EH Centralized
       Operations        (4,279)    (3,247)    (6,404)       539    (7,921)
      Bristow Academy       (91)      (391)      (130)      (197)      546
      Intrasegment
       eliminations         584       (751)     4,094      5,469     2,665
      Corporate          (5,592)    (5,603)    (6,721)    (8,697)   (7,385)
                       --------   --------   --------   --------  --------
        Consolidated
         total          $28,786    $49,724    $36,748    $33,496   $31,587
                       ========   ========   ========   ========  ========

    Operating margin:
      U.S. Gulf of
       Mexico              16.4%      17.3%      15.3%      13.2%     13.0%
      Arctic               15.5%      27.2%      -2.8%     -13.8%     12.2%
      Latin America        20.8%      25.1%      23.2%      15.3%     32.0%
      Europe               17.5%      23.4%      21.8%      22.5%     18.3%
      West Africa           8.4%      33.8%      15.2%      14.6%     15.0%
      Southeast Asia       18.3%      21.4%      21.6%      23.1%     11.4%
      Other
       International       19.7%      14.8%       6.0%     -41.5%      9.2%
      Bristow Academy      -3.0%     -12.1%      -3.3%      -4.3%      8.9%
        Consolidated
         total             12.5%      19.1%      14.1%      12.9%     11.1%

SOURCE: Bristow Group Inc.

CONTACT: Linda McNeill, Investor Relations of Bristow Group Inc., +1-713-267-7622
Web site: http://www.bristowgroup.com