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News Release

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Bristow Group Reports Strong Fiscal 2008 Second Quarter Results

HOUSTON, Nov. 5 /PRNewswire-FirstCall/ -- Bristow Group Inc. (NYSE: BRS) today reported financial results for its fiscal 2008 second quarter ended September 30, 2007.

Highlights include:

For the quarter ended September 30, 2007:

  • Revenue of $273.3 million increased by 21.9 percent over the second quarter of fiscal year 2007. Revenue gains occurred in most of our business units, driven by increases in rates for helicopter services and the addition of new aircraft;
  • Operating income of $50.6 million and operating margin of 18.5 percent increased over operating income of $30.9 million and operating margin of 13.8 percent for the second quarter of fiscal year 2007, primarily as a result of the improvement in revenue as well as the items discussed below;
  • Net income of $34.0 million increased by $14.9 million versus net income for the second quarter of fiscal year 2007. Increases in operating income, foreign currency gains and earnings from unconsolidated affiliates contributed to the improvement in the latest quarter's net income;
  • Diluted earnings per share increased to $1.12 from $0.79 for the second quarter of fiscal year 2007. Diluted earnings per share for the second quarter of fiscal years 2008 and 2007 reflected the assumed conversion of the Company's Mandatory Convertible Preferred Stock, which added approximately 6.5 million and 0.7 million shares, respectively, to the weighted average diluted shares calculation.
  • Operating results for the second quarter of fiscal year 2008 included the following items:
    • Reversal of $1.0 million of previously accrued settlement costs associated with the U.S. Securities and Exchange Commission ("SEC") investigation settled in September 2007.
    • Reversal of a $5.4 million accrual for sales tax contingency in Nigeria.
    • $2.1 million of retroactive rate increases with a major customer in Nigeria.

Excluding these items, operating income, operating margin, net income and diluted EPS would have been $42.1 million, 15.5%, $28.4 million and $0.93 per common share, respectively.

For the six months ended September 30, 2007:

  • Revenue of $518.3 million increased by 16.4 percent over the same period of fiscal year 2007. Revenue gains occurred in most of our business units, driven by increases in rates for helicopter services and the addition of new aircraft;
  • Operating income of $80.5 million and operating margin of 15.5 percent increased over operating income of $61.9 million and operating margin of 13.9 percent for the same period in fiscal year 2007, primarily as a result of the improvement in rates;
  • Net income of $56.6 million increased by $20.3 million versus net income for the six months ended September 30, 2006. Increases in operating income, foreign currency gains and earnings from unconsolidated affiliates contributed to the improvement in year-to-date net income.
  • Diluted earnings per share increased to $1.87 from $1.52 for the same period in fiscal year 2007. Diluted earnings per share for the six months ended September 30, 2007 and 2006 reflected the assumed conversion of the Company's Mandatory Convertible Preferred Stock, which added approximately 6.5 million and 0.3 million shares, respectively, to the weighted average diluted shares calculation.
  • Operating results for the six months ended September 30, 2007 included the following items:
    • Reversal of $1.0 million of previously accrued SEC settlement costs.
    • Reversal of a $5.4 million accrual for sales tax contingency in Nigeria.

Excluding these items, operating income, operating margin, net income and diluted EPS would have been $74.1 million, 14.3%, $52.5 million and $1.73 per common share, respectively.

Capital and Liquidity:

  • The September 30, 2007 consolidated balance sheet reflected $942.3 million in stockholders' investment and $557.3 million of indebtedness;
  • We had $276.4 million in cash and an undrawn $100 million revolving credit facility;
  • We generated $43.5 million of cash from operating activities for the six months ended September 30, 2007. We also used $221.1 million for capital expenditures, primarily for aircraft, and $12.9 million for the acquisition (net of cash acquired) of Bristow Academy during the six months ended September 30, 2007;
  • Aircraft purchase commitments totaled $276.5 million, with options totaling $608.0 million as of September 30, 2007.

William E. Chiles, President and Chief Executive Officer of Bristow Group Inc., said, "We are very pleased with our strong financial performance and excellent execution against our strategic plan during the latest quarter. We continue to proceed with our plan to expand our fleet and we recently announced our decision to exercise options to acquire an additional four Sikorsky S-92(R) large helicopters and three Sikorsky S-76C++(TM) medium helicopters with a combined value of more than $100 million. All seven helicopters are expected to be delivered in late 2008.

"We also remain on target with our plan to improve overall margins and operating efficiencies. We are systematically reviewing the profitability of our contracts and making a concerted effort to improve our return on capital, especially in Nigeria.

"The industry fundamentals continue to be very strong, and our customers remain committed to field development plans, which are the primary drivers of our growth. We continue to believe demand for aircraft will exceed supply over the next several years, which should create good opportunities to enhance revenue and margin growth going forward."

CONFERENCE CALL

Management will conduct a conference call starting at 10:00 a.m. EST

(9:00 a.m. CST) on Tuesday, November 6, 2007, to review financial results for the fiscal quarter ended September 30, 2007. 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 "Q2 2008 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) 257-1836
  • Replay: A telephone replay will be available through November 20, 2007, by dialing toll free (800) 405-2236, passcode: 11099470#

Via Telephone outside the U.S.:

  • Live: Dial (303) 262-2139
  • Replay: A telephone replay will be available through November 20, 2007 by dialing (303) 590-3000, passcode: 11099470#

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 the U.S. Gulf of Mexico and the North Sea, and in most of the other major offshore oil and gas producing regions of the world, including Alaska, Australia, Mexico, Nigeria, Russia and Trinidad. 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, industry conditions, future results, revenue growth, margins, operating efficiency, rate of return, the addition of new aircraft to our fleet and aircraft delivery. 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 September 30, 2007 and the annual report on Form 10-K for the year ended March 31, 2007. 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.

    Contact:
    Joe Baj, VP & Treasurer
    (713) 267-7605
    Linda McNeill, Treasury Manager
    (713) 267-7622

                          (financial tables follow)



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

                            Three Months Ended         Six Months Ended
                              September 30,              September 30,
                          ---------------------       ---------------------
                            2006         2007          2006         2007
                          ---------   ---------      ---------    ---------
                                            (Unaudited)
    Gross revenue:
      Operating revenue from
       non-affiliates     $191,341     $231,475     $373,127     $443,929
      Operating revenue
       from affiliates      11,631       13,858       23,710       24,955
      Reimbursable revenue
       from non-affiliates  20,091       25,505       46,216       45,853
      Reimbursable revenue
       from affiliates       1,146        2,498        2,218        3,601
                          ---------   ---------      ---------    ---------
                           224,209      273,336      445,271      518,338
                          ---------   ---------      ---------    ---------
    Operating expense:
      Direct cost          148,872      162,764      287,341      326,600
      Reimbursable expense  20,879       25,793       47,778       47,034
      Depreciation and
       amortization         10,737       12,395       21,020       23,768
      General and
       administrative       16,527       21,039       31,876       40,301
      Loss (gain) on
       disposal of assets   (3,667)         754       (4,665)         170
                          ---------   ---------      ---------    ---------
                           193,348      222,745      383,350      437,873
                          ---------   ---------      ---------    ---------
        Operating income    30,861       50,591       61,921       80,465
    Earnings from
     unconsolidated
     affiliates, net
     of losses               1,728        4,118        3,287        7,508
    Interest income          1,069        4,049        2,359        6,247
    Interest expense        (2,871)      (6,523)      (6,107)      (9,456)
    Other income (expense),
     net                    (1,308)         360       (6,093)         786
                          ---------   ---------      ---------    ---------
        Income before
         provision for
         income taxes and
         minority interest  29,479       52,595       55,367       85,550
    Provision for income
     taxes                  (9,728)     (18,641)     (18,271)     (28,475)
    Minority interest         (676)          (4)        (792)        (453)
                          ---------   ---------      ---------    ---------
      Net income            19,075       33,950       36,304       56,622
      Preferred stock
       dividends              (321)      (3,163)        (321)      (6,325)
                          ---------   ---------      ---------    ---------
      Net income available
       to common
       stockholders        $18,754      $30,787      $35,983      $50,297
                          =========   =========      =========    =========
    Earnings per common share:
      Basic                  $0.80        $1.30        $1.54        $2.13
                          =========   =========      =========    =========
      Diluted                $0.79        $1.12        $1.52        $1.87
                          =========   =========      =========    =========


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

                                                   March 31,     September 30,
                                                     2007            2007
                                                -------------    -------------
                                                                  (Unaudited)
                              ASSETS
    Current assets:
      Cash and cash equivalents                     $184,188       $276,439
      Accounts receivable from non-affiliates        158,770        191,962
      Accounts receivable from affiliates             17,199         14,862
      Inventories                                    157,870        176,459
      Prepaid expenses and other                      17,947         26,244
                                                -------------    -------------
        Total current assets                         535,974        685,966
    Investment in unconsolidated affiliates           46,828         54,314
    Property and equipment - at cost:
      Land and buildings                              51,850         55,619
      Aircraft and equipment                       1,141,578      1,353,975
                                                -------------    -------------
                                                   1,193,428      1,409,594
      Less - Accumulated depreciation
       and amortization                             (301,520)      (309,726)
                                                -------------    -------------
                                                     891,908      1,099,868
    Goodwill                                          20,368         29,302
    Other assets                                      10,725         29,793
                                                -------------    -------------
                                                  $1,505,803     $1,899,243
                                                =============    =============
              LIABILITIES AND STOCKHOLDERS' INVESTMENT
    Current liabilities:
      Accounts payable                               $42,343        $49,055
      Accrued wages, benefits and related taxes       38,281         39,414
      Income taxes payable                             4,377          9,489
      Other accrued taxes                              9,084          5,118
      Deferred revenues                               16,283         14,703
      Accrued maintenance and repairs                 12,309         13,556
      Other accrued liabilities                       22,828         27,167
      Deferred taxes                                  17,611         18,479
      Short-term borrowings and current
       maturities of long-term debt                    4,852          6,764
                                                -------------    -------------
        Total current liabilities                    167,968        183,745
    Long-term debt, less current maturities          254,230        550,571
    Accrued pension liabilities                      113,069        112,121
    Other liabilities and deferred credits            17,345         15,312
    Deferred taxes                                    76,089         89,914
    Minority interest                                  5,445          5,258
    Commitments and contingencies
    Stockholders' investment:
      5.50% mandatory convertible preferred stock    222,554        222,554
      Common stock                                       236            237
      Additional paid-in capital                     169,353        174,383
      Retained earnings                              515,589        565,886
      Accumulated other comprehensive loss           (36,075)       (20,738)
                                                -------------    -------------
                                                     871,657        942,322
                                                -------------    -------------
                                                  $1,505,803     $1,899,243
                                                =============    =============


                     BRISTOW GROUP INC. AND SUBSIDIARIES
            CORPORATE ITEMS AFFECTING THE COMPARABILITY OF RESULTS
                   (In thousands, except per share amounts)
                                 (Unaudited)

                                 Three Months Ended September 30,
                    --------------------------------------------------------
                                 2006                       2007
                    ---------------------------  ---------------------------
                                        Diluted                     Diluted
                                        Earnings                    Earnings
                     Pre-tax      Net     Per    Pre-tax     Net     Per
                    Earnings    Income   Share   Earnings   Income   Share
                    ---------  -------  -------  --------  -------  --------
    Investigations:
      SEC (1)             $-        $-      $-   $1,000      $650   $0.02
      DOJ (2)           (282)     (183)  (0.01)    (488)     (317)  (0.01)
    Tax contingency
     related items (3)     -       700    0.03    5,396     3,407    0.11
    7 1/2% Senior
     Notes due 2017 (4)    -         -       -   (2,248)   (1,461)  (0.05)
    Foreign currency
     transaction gains
     (losses) (5)     (1,333)     (867)  (0.04)     334       217    0.01
    Preferred
     Stock (6)           291       189   (0.01)       -         -   (0.30)
                    ---------  -------  -------  --------  -------  --------
    Total            $(1,324)    $(161) $(0.03)  $3,994    $2,496  $(0.22)
                    =========  =======  =======  ========  =======  ========


                                 Six Months Ended September 30,
                    --------------------------------------------------------
                                2006                       2007
                    ---------------------------  ---------------------------
                                        Diluted                     Diluted
                                        Earnings                    Earnings
                     Pre-tax      Net     Per    Pre-tax     Net     Per
                    Earnings    Income   Share   Earnings   Income   Share
                    ---------  -------  -------  --------  -------  --------

    Investigations:
      SEC (1)             $-        $-      $-   $1,000      $650   $0.02
      DOJ (2)           (873)     (567)  (0.02)    (488)     (317)  (0.01)
    Tax contingency
     related items (3)     -     1,500    0.06    5,396     4,407    0.15
    7 1/2% Senior
     Notes due 2017 (4)    -         -       -   (2,605)   (1,693)  (0.06)
    Foreign currency
     transaction gains
     (losses) (5)     (6,142)   (3,993)  (0.17)     735       478    0.02
    Preferred
     Stock (6)           291       189   (0.01)     826       537   (0.50)
                    ---------  -------  -------  --------  -------  --------
    Total            $(6,724)  $(2,871) $(0.14)  $4,864    $4,062  $(0.38)
                    =========  =======  =======  ========  =======  ========


    (1) Represents a reversal of previously accrued costs incurred in
        conjunction with the SEC investigation regarding findings from the
        internal review initiated by the Audit Committee of our board of
        directors in fiscal year 2005 of certain payments made by two of our
        affiliated entities in a foreign country.  These costs were included
        in general & administrative costs in our consolidated statements of
        income.
    (2) Represents legal and other professional fees incurred in connection
        with a document subpoena received from the Antitrust Division of the
        Department of Justice ("DOJ") in June 2005, which related to a grand
        jury investigation of potential antitrust violations among providers
        of helicopter transportation services in the U.S. Gulf of Mexico
        focusing on activities during the period from January 1, 2000 to
        June 13, 2005.  These costs are included in general & administrative
        costs in our consolidated statements of income.
    (3) Represents $5.4 million in reversal of accrual for sales tax
        contingency during the three and six months ended September 30, 2007
        in Nigeria included in direct costs in our consolidated statements of
        income and a direct reduction in our provision for income taxes in our
        consolidated statements of income for income tax contingency items,
        which represents the remainder of the impact on net income and diluted
        earnings per share.
    (4) Represents the effect on interest expense, net of interest income from
        invested proceeds, resulting from the issuance of 7 1/2% Senior Notes
        due 2017 in June 2007.
    (5) Represents foreign currency transaction gains and losses resulting
        from changes in exchange rates during the applicable periods.  The
        effects of these foreign currency transaction gains and losses were
        offset to a large extent by corresponding charges or benefits in the
        cumulative translation adjustment in stockholders' investment with no
        overall economic effect.  These amounts are included in other income
        (expense), net in our consolidated statements of income.
    (6) Represents the effect of the preferred stock offering completed in
        September and October 2006.  The net income effect results from
        interest income earned on remaining cash proceeds generated from the
        offering.  Diluted earnings per share for the three and six months
        ended September 30, 2007 and 2006 was reduced by the effect of the
        inclusion of weighted average shares resulting from the assumed
        conversion of the preferred stock at the conversion rate that results
        in the most dilution, partially offset by the impact of higher
        interest income.



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

                            Three Months Ended         Six Months Ended
                                September 30,            September 30,
                          ---------------------     ---------------------
                             2006         2007          2006        2007
                          ----------   --------     -----------  --------
                                             (Unaudited)

    Flight hours (excludes
     Bristow Academy and
     unconsolidated affiliates):
      Helicopter Services:
        North America       41,148       39,623       83,757       79,894
        South and Central
         America             9,631       10,810       18,916       22,177
        Europe              10,685       11,494       20,855       22,315
        West Africa          9,179        9,887       18,062       18,785
        Southeast Asia       3,063        3,644        6,269        6,988
        Other International  2,426        2,177        4,478        4,724
                          ----------   --------     -----------  --------
          Consolidated
           total            76,132       77,635      152,337      154,883
                          ==========   ========     ===========  ========
    Gross revenue:
      Helicopter Services:
        North America      $62,504      $62,059     $125,872     $122,998
        South and Central
         America            13,137       16,951       26,149       32,987
        Europe              72,706       93,459      144,687      176,816
        West Africa         31,210       45,799       62,946       79,082
        Southeast Asia      17,626       23,858       34,666       46,350
        Other International 12,184       12,046       21,139       23,501
        EH Centralized
         Operations          3,538        5,331        6,612       12,136
        Bristow Academy          -        3,228            -        6,247
        Intrasegment
         eliminations       (3,276)      (3,005)      (6,136)      (9,240)
                          ----------   --------     -----------  --------
      Total Helicopter
       Services            209,629      259,726      415,935      490,877
      Production Management
       Services             17,784       16,030       35,468       32,573
      Corporate                  -            -          (25)           -
      Intersegment
       eliminations         (3,204)      (2,420)      (6,107)      (5,112)
                          ----------   --------     -----------  --------
          Consolidated
           total          $224,209     $273,336     $445,271     $518,338
                          ==========   ========     ===========  ========
    Operating income:
      Helicopter Services:
        North America       $7,107      $10,869      $16,340      $21,583
        South and Central
         America             3,624        4,573        7,594        8,258
        Europe              13,527       21,895       27,623       36,470
        West Africa          2,848       15,492        7,181       18,289
        Southeast Asia       3,210        5,107        5,645        9,234
        Other International  3,771        1,781        5,287        4,046
        EH Centralized
         Operations         (2,584)      (3,247)      (4,351)      (7,526)
        Bristow Academy          -         (391)           -         (482)
                          ----------   --------     -----------  --------
      Total Helicopter
       Services             31,503       56,079       65,319       89,872
      Production Management
       Services              1,394          870        2,807        1,959
      Gain (loss) on
       disposal of assets    3,667         (754)       4,665         (170)
      Corporate             (5,703)      (5,604)     (10,870)     (11,196)
                          ----------   --------     -----------  --------
          Consolidated
           total           $30,861      $50,591      $61,921      $80,465
                          ==========   ========     ===========  ========

    Operating margin:

      Helicopter Services:
        North America         11.4%        17.5%        13.0%        17.5%
        South and Central
         America              27.6%        27.0%        29.0%        25.0%
        Europe                18.6%        23.4%        19.1%        20.6%
        West Africa            9.1%        33.8%        11.4%        23.1%
        Southeast Asia        18.2%        21.4%        16.3%        19.9%
        Other International   31.0%        14.8%        25.0%        17.2%
        EH Centralized
         Operations          (73.0)%      (60.9)%      (65.8)%      (62.0)%
        Bristow Academy        N/A        (12.1)%        N/A         (7.7)%
      Total Helicopter
       Services               15.0%        21.6%        15.7%        18.3%
      Production Management
       Services                7.8%         5.4%         7.9%         6.0%
          Consolidated total  13.8%        18.5%        13.9%        15.5%

SOURCE: Bristow Group Inc.

CONTACT: Joe Baj, VP & Treasurer, +1-713-267-7605, or Linda McNeill,
Treasury Manager, +1-713-267-7622, both of Bristow Group Inc.
Web site: http://www.bristowgroup.com