ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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72-1455213
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(State or Other Jurisdiction of
Incorporation or Organization)
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(IRS Employer
Identification No.)
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818 Town & Country Blvd., Suite 200
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Houston, Texas
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77024
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(Address of Principal Executive Offices)
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(Zip Code)
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Large accelerated filer
¨
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Accelerated filer
¨
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Non-accelerated filer
x
(Do not check if a smaller
reporting company)
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Smaller reporting company
¨
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Part I.
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Part II.
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Item 1A.
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Item 6.
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ITEM 1.
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FINANCIAL STATEMENTS
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ERA GROUP INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
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|||||||
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March 31,
2013 |
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December 31,
2012 |
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(Unaudited)
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ASSETS
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Current Assets:
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Cash and cash equivalents
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$
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25,032
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$
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11,505
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Receivables:
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Trade, net of allowance for doubtful accounts of $2,817 and $2,668 in 2013 and 2012, respectively
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40,761
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48,527
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Other
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16,416
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3,742
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Due from SEACOR
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—
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971
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Inventories
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26,696
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26,650
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Deferred income taxes
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3,642
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3,642
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Prepaid expenses and other
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2,715
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1,803
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Total current assets
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115,262
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96,840
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Property and Equipment
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1,021,453
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1,030,276
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Accumulated depreciation
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(246,498
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)
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(242,471
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)
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Net property and equipment
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774,955
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787,805
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Investments, at Equity, and Advances to 50% or Less Owned Companies
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34,705
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34,696
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Goodwill
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352
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352
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Other Assets
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17,830
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17,871
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Total Assets
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$
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943,104
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$
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937,564
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LIABILITIES AND EQUITY
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Current Liabilities:
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Accounts payable and accrued expenses
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$
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13,126
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$
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15,703
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Accrued wages and benefits
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7,662
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4,576
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Accrued interest
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5,213
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1,401
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Current portion of long-term debt
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2,787
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2,787
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Due to SEACOR
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270
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—
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Other current liabilities
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4,309
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5,232
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Total current liabilities
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33,367
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29,699
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Long-Term Debt
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276,307
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276,948
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Deferred Income Taxes
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203,343
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203,536
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Deferred Gains and Other Liabilities
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8,164
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7,864
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Total liabilities
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521,181
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518,047
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Series A Preferred Stock, at redemption value; $0.01 par value, 10,000,000 shares authorized; 1,400,000 shares issued in 2012
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—
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144,232
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Equity:
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Era Group Inc. stockholders’ equity:
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Common stock, $0.01 par value, 60,000,000 shares authorized; 20,123,639 issued in 2013; none issued in 2012
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201
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—
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Class B common stock, $0.01 par value, 60,000,000 shares authorized; none issued in 2013; 24,500,000 issued in 2012
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—
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245
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Additional paid-in capital
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419,036
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278,838
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Retained earnings (accumulated deficit)
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2,669
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(4,025
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)
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Accumulated other comprehensive income (loss), net of tax
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(85
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)
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20
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421,821
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275,078
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Noncontrolling interest in subsidiary
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102
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207
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Total equity
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421,923
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275,285
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Total Liabilities and Stockholders
’
Equity
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$
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943,104
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$
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937,564
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ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
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Three Months Ended March 31,
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2013
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2012
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(Unaudited)
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Operating Revenues
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$
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67,727
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$
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61,052
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Costs and Expenses:
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Operating
|
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43,116
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39,676
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Administrative and general
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9,134
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9,677
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Depreciation
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11,661
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9,630
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63,911
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58,983
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Gains on Asset Dispositions, Net
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10,801
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1,765
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Operating Income
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14,617
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3,834
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Other Income (Expense):
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Interest income
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147
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332
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Interest expense
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(4,732
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)
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(1,968
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)
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SEACOR management fees
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(168
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)
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(500
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)
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Derivative losses, net
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(3
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)
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(124
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)
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Foreign currency gains (losses), net
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(259
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)
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917
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Other, net
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3
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30
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(5,012
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)
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(1,313
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)
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Income Before Income Tax Expense and Equity in Earnings (Losses) of 50% or Less Owned Companies
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9,605
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2,521
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Income Tax Expense
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3,578
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734
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Income Before Equity in Earnings (Losses) of 50% or Less Owned Companies
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6,027
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1,787
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Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
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562
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(6,420
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)
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Net Income (Loss)
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6,589
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(4,633
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)
|
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Net Loss attributable to Noncontrolling Interest in Subsidiary
|
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105
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—
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Net Income (Loss) attributable to Era Group Inc.
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6,694
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(4,633
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)
|
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Accretion of redemption value on Series A Preferred Stock
|
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721
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2,100
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|
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Net Income (Loss) attributable to Common Shares
|
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$
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5,973
|
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$
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(6,733
|
)
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Earnings (Loss) Per Common Share:
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|
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Basic and Diluted Earnings (Loss) Per Common Share
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$
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0.28
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$
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(0.27
|
)
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Weighted Average Common Shares Outstanding
|
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21,454,396
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24,500,000
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ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in thousands)
|
||||||||
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Three Months Ended March 31,
|
||||||
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2013
|
|
2012
|
||||
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(Unaudited)
|
||||||
Net Income (Loss)
|
|
$
|
6,589
|
|
|
$
|
(4,633
|
)
|
Other Comprehensive Income (Loss):
|
|
|
|
|
||||
Foreign currency translation adjustments
|
|
(162
|
)
|
|
980
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|
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Income tax benefit (expense)
|
|
57
|
|
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(343
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)
|
||
|
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(105
|
)
|
|
637
|
|
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Comprehensive Income (Loss)
|
|
6,484
|
|
|
(3,996
|
)
|
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Comprehensive Loss attributable to Noncontrolling Interest in Subsidiary
|
|
105
|
|
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—
|
|
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Comprehensive Income (Loss) attributable to Era Group Inc.
|
|
$
|
6,589
|
|
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$
|
(3,996
|
)
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ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(in thousands, unaudited)
|
|||||||||||||||||||||||||||||||||
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Era Group Inc. Stockholders’ Equity
|
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Non-
controlling
Interest In
Subsidiary
|
|
Total
Equity
|
||||||||||||||||||||||||
|
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Series A Convertible Preferred Stock
|
|
|
Class B Common
Stock
|
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Retained Earnings (Accumulated Deficit)
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
|||||||||||||||||||
December 31, 2012
|
|
$
|
144,232
|
|
|
|
$
|
245
|
|
|
$
|
—
|
|
|
$
|
278,838
|
|
|
$
|
(4,025
|
)
|
|
$
|
20
|
|
|
$
|
207
|
|
|
$
|
275,285
|
|
Accretion of redemption value on Series A preferred stock
|
|
721
|
|
|
|
—
|
|
|
—
|
|
|
(721
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(721
|
)
|
||||||||
Preferred stock dividend
|
|
(4,953
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Recapitalization of Era Group by SEACOR
|
|
(140,000
|
)
|
|
|
(245
|
)
|
|
199
|
|
|
140,046
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
140,000
|
|
||||||||
Issuance of Era Group stock options in settlement of SEACOR stock options
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
706
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
706
|
|
||||||||
Issuance of common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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||||||||||||||||
Restricted stock grants
|
|
—
|
|
|
|
—
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Proceeds and tax benefits from share award plans
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
89
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
89
|
|
||||||||
Share award amortization
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
||||||||
Net income (loss)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,694
|
|
|
—
|
|
|
(105
|
)
|
|
6,589
|
|
||||||||
Currency translation adjustments, net of tax
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(105
|
)
|
|
—
|
|
|
(105
|
)
|
||||||||
March 31, 2013
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
201
|
|
|
$
|
419,036
|
|
|
$
|
2,669
|
|
|
$
|
(85
|
)
|
|
$
|
102
|
|
|
$
|
421,923
|
|
ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
|
|||||||
|
Three Months Ended March 31,
|
||||||
|
2013
|
|
2012
|
||||
|
(Unaudited)
|
||||||
Net Cash Provided by (Used in) Operating Activities
|
$
|
17,877
|
|
|
$
|
(39,712
|
)
|
Cash Flows from Investing Activities:
|
|
|
|
||||
Purchases of property and equipment
|
(19,445
|
)
|
|
(54,272
|
)
|
||
Proceeds from disposition of property and equipment
|
19,099
|
|
|
2,935
|
|
||
Cash settlements on derivative transactions, net
|
—
|
|
|
(98
|
)
|
||
Principal payments on notes due from equity investees
|
535
|
|
|
439
|
|
||
Principal payments on third party notes receivable, net
|
347
|
|
|
346
|
|
||
Net cash provided by (used in) investing activities
|
536
|
|
|
(50,650
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Payments on long-term debt
|
(15,697
|
)
|
|
(697
|
)
|
||
Proceeds from issuance of long-term debt
|
15,000
|
|
|
38,000
|
|
||
Dividends paid on Series A preferred stock
|
(4,953
|
)
|
|
—
|
|
||
Proceeds and tax benefits from share award plans
|
89
|
|
|
—
|
|
||
Proceeds from SEACOR on the settlement of stock options
|
706
|
|
|
—
|
|
||
Net cash provided by (used in) financing activities
|
(4,855
|
)
|
|
37,303
|
|
||
Effects of Exchange Rate Changes on Cash and Cash Equivalents
|
(31
|
)
|
|
810
|
|
||
Net Increase (Decrease) in Cash and Cash Equivalents
|
13,527
|
|
|
(52,249
|
)
|
||
Cash and Cash Equivalents, Beginning of Period
|
11,505
|
|
|
79,122
|
|
||
Cash and Cash Equivalents, End of Period
|
$
|
25,032
|
|
|
$
|
26,873
|
|
1.
|
BASIS OF PRESENTATION AND ACCOUNTING POLICY
|
|
2013
|
|
2012
|
||||
Balance at beginning of period
|
$
|
8,953
|
|
|
$
|
123
|
|
Revenues deferred during the period
|
8,932
|
|
|
2,955
|
|
||
Revenues recognized during the period
|
(5,152
|
)
|
|
(114
|
)
|
||
Balance at end of period
|
$
|
12,733
|
|
|
$
|
2,964
|
|
2.
|
FAIR VALUE MEASUREMENTS
|
|
|
|
Estimated Fair Value
|
||||||||||||
|
Carrying
Amount
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
ASSETS
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
25,032
|
|
|
$
|
25,032
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Notes receivable from other business ventures (included in other
receivables and other assets)
|
872
|
|
|
872
|
|
|
—
|
|
|
—
|
|
||||
LIABILITIES
|
|
|
|
|
|
|
|
||||||||
Long-term debt, including current portion
|
279,094
|
|
|
—
|
|
|
292,840
|
|
|
—
|
|
3.
|
DERIVATIVE INSTRUMENTS
|
4.
|
EQUIPMENT ACQUISITIONS AND DISPOSITIONS
|
Light helicopters - twin engine
(1)
|
|
2
|
|
Medium helicopters
|
|
3
|
|
Heavy helicopters
|
|
1
|
|
|
|
6
|
|
5.
|
INVESTMENTS, AT EQUITY, AND ADVANCES TO 50% OR LESS OWNED COMPANIES
|
|
|
2013
|
|
2012
|
||||
Operating Revenues
|
|
$
|
10,776
|
|
|
$
|
11,582
|
|
Costs and Expenses:
|
|
|
|
|
||||
Operating and administrative
|
|
7,759
|
|
|
8,551
|
|
||
Depreciation
|
|
1,298
|
|
|
1,349
|
|
||
|
|
9,057
|
|
|
9,900
|
|
||
Operating Income
|
|
$
|
1,719
|
|
|
$
|
1,682
|
|
Net Income (Loss)
|
|
$
|
1,175
|
|
|
$
|
(312
|
)
|
6.
|
INCOME TAXES
|
7.
|
LONG-TERM DEBT
|
The Company’s borrowings as of the periods indicated were as follows (in thousands):
|
||||||||
|
|
March 31, 2013
|
|
December 31, 2012
|
||||
7.750% Senior Notes (excluding unamortized discount of $3.3 million)
|
|
$
|
200,000
|
|
|
$
|
200,000
|
|
Senior Secured Revolving Credit Facility
|
|
50,000
|
|
|
50,000
|
|
||
Promissory Notes
|
|
32,401
|
|
|
33,098
|
|
||
|
|
282,401
|
|
|
283,098
|
|
||
Less: Portion due with one year
|
|
(2,787
|
)
|
|
(2,787
|
)
|
||
Less: Debt discount, net
|
|
(3,307
|
)
|
|
(3,363
|
)
|
||
Total Long-Term Debt
|
|
$
|
276,307
|
|
|
$
|
276,948
|
|
8.
|
COMMITMENTS AND CONTINGENCIES
|
9.
|
SERIES A PREFERRED STOCK
|
10.
|
EARNINGS PER COMMON SHARE
|
2013
|
|
Net Income (Loss) Attributable to Common Shares
|
|
Average O/S Shares
|
|
Per Share
|
|||||
Basic Weighted Average Common Shares Outstanding
|
|
$
|
5,973
|
|
|
21,454,396
|
|
|
$
|
0.28
|
|
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|||||
Series A Preferred Stock
(1)
|
|
—
|
|
|
—
|
|
|
|
|||
Options and Restricted Stock
(2)
|
|
—
|
|
|
—
|
|
|
|
|||
Diluted Weighted Average Common Shares Outstanding
|
|
$
|
5,973
|
|
|
21,454,396
|
|
|
$
|
0.28
|
|
|
|
|
|
|
|
|
|||||
2012
|
|
|
|
|
|
|
|||||
Basic Weighted Average Common Shares Outstanding
|
|
$
|
(6,733
|
)
|
|
24,500,000
|
|
|
$
|
(0.27
|
)
|
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|||||
Series A Preferred Stock
(3)
|
|
—
|
|
|
—
|
|
|
|
|||
Diluted Weighted Average Common Shares Outstanding
|
|
$
|
(6,733
|
)
|
|
24,500,000
|
|
|
$
|
(0.27
|
)
|
11.
|
RELATED PARTY TRANSACTIONS
|
12.
|
SHARE-BASED COMPENSATION
|
Director stock awards granted and outstanding
|
45,510
|
|
Restricted stock awards granted and outstanding
|
188,200
|
|
Stock option activities:
|
|
|
Outstanding as of December 31, 2012
|
—
|
|
Converted stock options
|
169,058
|
|
Granted
|
185,000
|
|
Exercised
|
(6,346
|
)
|
Forfeited
|
—
|
|
Expired
|
—
|
|
Outstanding as of March 31, 2013
|
347,712
|
|
Risk free interest rate
|
|
0.79
|
%
|
Expected life (years)
|
|
5
|
|
Volatility
|
|
50
|
%
|
Dividend yield
|
|
—
|
%
|
Weighted average exercise price of options granted
|
|
$18.28 per option
|
|
Weighted average grant-date fair value of options granted
|
|
$7.58 per option
|
|
13.
|
SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION
|
Supplemental Condensed Consolidating Balance Sheet as of March 31, 2013
|
||||||||||||||||||||
|
|
Parent Company Only
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
8,497
|
|
|
$
|
15,355
|
|
|
$
|
1,180
|
|
|
$
|
—
|
|
|
$
|
25,032
|
|
Receivables:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Trade, net of allowance for doubtful accounts of $2,817
|
|
—
|
|
|
40,436
|
|
|
325
|
|
|
—
|
|
|
40,761
|
|
|||||
Other
|
|
363
|
|
|
16,416
|
|
|
—
|
|
|
(363
|
)
|
|
16,416
|
|
|||||
Intercompany receivables
|
|
555,136
|
|
|
—
|
|
|
—
|
|
|
(555,136
|
)
|
|
—
|
|
|||||
Inventories, net
|
|
—
|
|
|
26,696
|
|
|
—
|
|
|
—
|
|
|
26,696
|
|
|||||
Deferred income taxes
|
|
5,467
|
|
|
—
|
|
|
—
|
|
|
(1,825
|
)
|
|
3,642
|
|
|||||
Prepaid expenses and other
|
|
38
|
|
|
2,677
|
|
|
—
|
|
|
—
|
|
|
2,715
|
|
|||||
Total current assets
|
|
569,501
|
|
|
101,580
|
|
|
1,505
|
|
|
(557,324
|
)
|
|
115,262
|
|
|||||
Property and Equipment:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Helicopters
|
|
—
|
|
|
883,402
|
|
|
11,500
|
|
|
—
|
|
|
894,902
|
|
|||||
Construction in progress
|
|
—
|
|
|
16,793
|
|
|
—
|
|
|
—
|
|
|
16,793
|
|
|||||
Machinery, equipment and spares
|
|
—
|
|
|
71,967
|
|
|
—
|
|
|
—
|
|
|
71,967
|
|
|||||
Buildings and leasehold improvements
|
|
—
|
|
|
25,585
|
|
|
—
|
|
|
—
|
|
|
25,585
|
|
|||||
Furniture, fixtures, vehicles and other
|
|
—
|
|
|
12,206
|
|
|
—
|
|
|
—
|
|
|
12,206
|
|
|||||
|
|
—
|
|
|
1,009,953
|
|
|
11,500
|
|
|
—
|
|
|
1,021,453
|
|
|||||
Accumulated depreciation
|
|
—
|
|
|
(245,290
|
)
|
|
(1,208
|
)
|
|
—
|
|
|
(246,498
|
)
|
|||||
|
|
—
|
|
|
764,663
|
|
|
10,292
|
|
|
—
|
|
|
774,955
|
|
|||||
Investments, at Equity, and Advances to 50% or Less Owned Companies
|
|
—
|
|
|
34,705
|
|
|
—
|
|
|
—
|
|
|
34,705
|
|
|||||
Investments, at Equity in Consolidated Subsidiaries
|
|
100,206
|
|
|
9,572
|
|
|
—
|
|
|
(109,778
|
)
|
|
—
|
|
|||||
Goodwill
|
|
—
|
|
|
352
|
|
|
—
|
|
|
—
|
|
|
352
|
|
|||||
Other Assets
|
|
6,028
|
|
|
11,802
|
|
|
—
|
|
|
—
|
|
|
17,830
|
|
|||||
Total Assets
|
|
$
|
675,735
|
|
|
$
|
922,674
|
|
|
$
|
11,797
|
|
|
$
|
(667,102
|
)
|
|
$
|
943,104
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and accrued expenses
|
|
$
|
1,759
|
|
|
$
|
11,222
|
|
|
$
|
145
|
|
|
$
|
—
|
|
|
$
|
13,126
|
|
Accrued wages and benefits
|
|
—
|
|
|
7,662
|
|
|
—
|
|
|
—
|
|
|
7,662
|
|
|||||
Accrued interest
|
|
5,192
|
|
|
21
|
|
|
—
|
|
|
—
|
|
|
5,213
|
|
|||||
Intercompany payables
|
|
—
|
|
|
545,852
|
|
|
11,125
|
|
|
(556,977
|
)
|
|
—
|
|
|||||
Due to SEACOR, net
|
|
270
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
270
|
|
|||||
Current portion of long-term debt
|
|
—
|
|
|
2,787
|
|
|
—
|
|
|
—
|
|
|
2,787
|
|
|||||
Other current liabilities
|
|
—
|
|
|
4,347
|
|
|
325
|
|
|
(363
|
)
|
|
4,309
|
|
|||||
Total current liabilities
|
|
7,221
|
|
|
571,891
|
|
|
11,595
|
|
|
(557,340
|
)
|
|
33,367
|
|
|||||
Long-Term Debt
|
|
246,693
|
|
|
29,614
|
|
|
—
|
|
|
—
|
|
|
276,307
|
|
|||||
Deferred Income Taxes
|
|
—
|
|
|
205,761
|
|
|
—
|
|
|
(2,418
|
)
|
|
203,343
|
|
|||||
Deferred Gains and Other Liabilities
|
|
—
|
|
|
6,601
|
|
|
—
|
|
|
1,563
|
|
|
8,164
|
|
|||||
Total liabilities
|
|
253,914
|
|
|
813,867
|
|
|
11,595
|
|
|
(558,195
|
)
|
|
521,181
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Equity:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Era Group Inc. stockholders' equity:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,123,639 issued in 2013; none issued in 2012
|
|
201
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
201
|
|
|||||
Additional paid-in capital
|
|
419,036
|
|
|
109,707
|
|
|
496
|
|
|
(110,203
|
)
|
|
419,036
|
|
|||||
Retained earnings (accumulated deficit)
|
|
2,669
|
|
|
(1,002
|
)
|
|
(294
|
)
|
|
1,296
|
|
|
2,669
|
|
|||||
Accumulated other comprehensive loss, net of tax
|
|
(85
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(85
|
)
|
|||||
|
|
421,821
|
|
|
108,705
|
|
|
202
|
|
|
(108,907
|
)
|
|
421,821
|
|
|||||
Noncontrolling interest in subsidiary
|
|
—
|
|
|
102
|
|
|
—
|
|
|
—
|
|
|
102
|
|
|||||
Total equity
|
|
421,821
|
|
|
108,807
|
|
|
202
|
|
|
(108,907
|
)
|
|
421,923
|
|
|||||
Total Liabilities and Stockholders
’
Equity
|
|
$
|
675,735
|
|
|
$
|
922,674
|
|
|
$
|
11,797
|
|
|
$
|
(667,102
|
)
|
|
$
|
943,104
|
|
Supplemental Condensed Consolidating Balance Sheet as of December 31, 2012
|
||||||||||||||||||||
|
|
Parent Company Only
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
2,258
|
|
|
$
|
8,558
|
|
|
$
|
689
|
|
|
$
|
—
|
|
|
$
|
11,505
|
|
Receivables:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Trade, net of allowance for doubtful accounts of $2,668
|
|
—
|
|
|
48,217
|
|
|
310
|
|
|
—
|
|
|
48,527
|
|
|||||
Other
|
|
—
|
|
|
3,742
|
|
|
—
|
|
|
—
|
|
|
3,742
|
|
|||||
Due from SEACOR and affiliates
|
|
561,298
|
|
|
—
|
|
|
—
|
|
|
(560,327
|
)
|
|
971
|
|
|||||
Inventories, net
|
|
—
|
|
|
26,650
|
|
|
—
|
|
|
—
|
|
|
26,650
|
|
|||||
Deferred income taxes
|
|
4,625
|
|
|
—
|
|
|
—
|
|
|
(983
|
)
|
|
3,642
|
|
|||||
Prepaid expenses and other
|
|
—
|
|
|
1,803
|
|
|
—
|
|
|
—
|
|
|
1,803
|
|
|||||
Total current assets
|
|
568,181
|
|
|
88,970
|
|
|
999
|
|
|
(561,310
|
)
|
|
96,840
|
|
|||||
Property and Equipment:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Helicopters
|
|
—
|
|
|
886,111
|
|
|
11,500
|
|
|
—
|
|
|
897,611
|
|
|||||
Construction in progress
|
|
—
|
|
|
22,644
|
|
|
—
|
|
|
—
|
|
|
22,644
|
|
|||||
Machinery, equipment and spares
|
|
—
|
|
|
72,161
|
|
|
—
|
|
|
—
|
|
|
72,161
|
|
|||||
Buildings and leasehold improvements
|
|
—
|
|
|
25,451
|
|
|
—
|
|
|
—
|
|
|
25,451
|
|
|||||
Furniture, fixtures, vehicles and other
|
|
—
|
|
|
12,409
|
|
|
—
|
|
|
—
|
|
|
12,409
|
|
|||||
|
|
—
|
|
|
1,018,776
|
|
|
11,500
|
|
|
—
|
|
|
1,030,276
|
|
|||||
Accumulated depreciation
|
|
—
|
|
|
(241,436
|
)
|
|
(1,035
|
)
|
|
—
|
|
|
(242,471
|
)
|
|||||
|
|
—
|
|
|
777,340
|
|
|
10,465
|
|
|
—
|
|
|
787,805
|
|
|||||
Investments, at Equity, and Advances to 50% or Less Owned Companies
|
|
—
|
|
|
34,696
|
|
|
—
|
|
|
—
|
|
|
34,696
|
|
|||||
Investments, at Equity in Consolidated Subsidiaries
|
|
100,101
|
|
|
9,782
|
|
|
—
|
|
|
(109,883
|
)
|
|
—
|
|
|||||
Goodwill
|
|
—
|
|
|
352
|
|
|
—
|
|
|
—
|
|
|
352
|
|
|||||
Other Assets
|
|
5,958
|
|
|
24,374
|
|
|
—
|
|
|
(12,461
|
)
|
|
17,871
|
|
|||||
Total Assets
|
|
$
|
674,240
|
|
|
$
|
935,514
|
|
|
$
|
11,464
|
|
|
$
|
(683,654
|
)
|
|
$
|
937,564
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and accrued expenses
|
|
$
|
—
|
|
|
$
|
15,618
|
|
|
$
|
85
|
|
|
$
|
—
|
|
|
$
|
15,703
|
|
Accrued wages and benefits
|
|
—
|
|
|
4,576
|
|
|
—
|
|
|
—
|
|
|
4,576
|
|
|||||
Accrued interest
|
|
1,357
|
|
|
44
|
|
|
—
|
|
|
—
|
|
|
1,401
|
|
|||||
Intercompany payables
|
|
5,491
|
|
|
560,323
|
|
|
10,965
|
|
|
(576,779
|
)
|
|
—
|
|
|||||
Current portion of long-term debt
|
|
—
|
|
|
2,787
|
|
|
—
|
|
|
—
|
|
|
2,787
|
|
|||||
Other current liabilities
|
|
1,445
|
|
|
3,787
|
|
|
—
|
|
|
—
|
|
|
5,232
|
|
|||||
Total current liabilities
|
|
8,293
|
|
|
587,135
|
|
|
11,050
|
|
|
(576,779
|
)
|
|
29,699
|
|
|||||
Long-Term Debt
|
|
246,637
|
|
|
30,311
|
|
|
—
|
|
|
—
|
|
|
276,948
|
|
|||||
Deferred Income Taxes
|
|
—
|
|
|
204,520
|
|
|
—
|
|
|
(984
|
)
|
|
203,536
|
|
|||||
Deferred Gains and Other Liabilities
|
|
—
|
|
|
7,864
|
|
|
—
|
|
|
—
|
|
|
7,864
|
|
|||||
Total liabilities
|
|
254,930
|
|
|
829,830
|
|
|
11,050
|
|
|
(577,763
|
)
|
|
518,047
|
|
|||||
Preferred Stock, $0.01 par value, 10,000,000 shares authorized:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Series A Preferred Stock, at redemption value; 1,400,000 shares issued
|
|
144,232
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
144,232
|
|
|||||
Equity:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Era Group Inc. stockholders' equity:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Class A common stock, $0.01 par value, 60,000,000 shares authorized; none issued
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Class B common stock, $0.01 par value, 60,000,000 shares authorized; 24,500,000 issued
|
|
245
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
245
|
|
|||||
Additional paid-in capital
|
|
278,838
|
|
|
109,674
|
|
|
496
|
|
|
(110,170
|
)
|
|
278,838
|
|
|||||
Retained earnings (accumulated deficit)
|
|
(4,025
|
)
|
|
(4,217
|
)
|
|
(82
|
)
|
|
4,299
|
|
|
(4,025
|
)
|
|||||
Accumulated other comprehensive income (loss), net of tax
|
|
20
|
|
|
20
|
|
|
—
|
|
|
(20
|
)
|
|
20
|
|
|||||
|
|
275,078
|
|
|
105,477
|
|
|
414
|
|
|
(105,891
|
)
|
|
275,078
|
|
|||||
Noncontrolling interest in subsidiary
|
|
—
|
|
|
207
|
|
|
—
|
|
|
—
|
|
|
207
|
|
|||||
Total equity
|
|
275,078
|
|
|
105,684
|
|
|
414
|
|
|
(105,891
|
)
|
|
275,285
|
|
|||||
Total Liabilities and Stockholders’ Equity
|
|
$
|
674,240
|
|
|
$
|
935,514
|
|
|
$
|
11,464
|
|
|
$
|
(683,654
|
)
|
|
$
|
937,564
|
|
Supplemental Condensed Consolidating Statement of Operations for the Three Months Ended March 31, 2013
|
||||||||||||||||||||
|
|
Parent Company Only
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Operating Revenues
|
|
$
|
—
|
|
|
$
|
67,372
|
|
|
$
|
355
|
|
|
$
|
—
|
|
|
$
|
67,727
|
|
Costs and Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating
|
|
—
|
|
|
42,882
|
|
|
234
|
|
|
—
|
|
|
43,116
|
|
|||||
Administrative and general
|
|
1,296
|
|
|
7,838
|
|
|
—
|
|
|
—
|
|
|
9,134
|
|
|||||
Depreciation
|
|
—
|
|
|
11,489
|
|
|
172
|
|
|
—
|
|
|
11,661
|
|
|||||
|
|
1,296
|
|
|
62,209
|
|
|
406
|
|
|
—
|
|
|
63,911
|
|
|||||
Gains on Asset Dispositions and Impairments, Net
|
|
—
|
|
|
10,801
|
|
|
—
|
|
|
—
|
|
|
10,801
|
|
|||||
Operating Income (Loss)
|
|
(1,296
|
)
|
|
15,964
|
|
|
(51
|
)
|
|
—
|
|
|
14,617
|
|
|||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest income
|
|
16
|
|
|
130
|
|
|
1
|
|
|
—
|
|
|
147
|
|
|||||
Interest expense
|
|
(4,473
|
)
|
|
(259
|
)
|
|
—
|
|
|
—
|
|
|
(4,732
|
)
|
|||||
Intercompany interest
|
|
8,398
|
|
|
(8,238
|
)
|
|
(160
|
)
|
|
—
|
|
|
—
|
|
|||||
SEACOR management fees
|
|
(168
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(168
|
)
|
|||||
Derivative losses, net
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||
Foreign currency losses, net
|
|
(1
|
)
|
|
(258
|
)
|
|
—
|
|
|
—
|
|
|
(259
|
)
|
|||||
Other, net
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
|
|
3,772
|
|
|
(8,625
|
)
|
|
(159
|
)
|
|
—
|
|
|
(5,012
|
)
|
|||||
Income (Loss) Before Income Tax Expense (Benefit) and Equity in Earnings of 50% or Less Owned Companies and Subsidiaries
|
|
2,476
|
|
|
7,339
|
|
|
(210
|
)
|
|
—
|
|
|
9,605
|
|
|||||
Income Tax Expense (Benefit)
|
|
(488
|
)
|
|
4,066
|
|
|
—
|
|
|
—
|
|
|
3,578
|
|
|||||
Income (Loss) Before Equity in Earnings of 50% or Less Owned Companies and Subsidiaries
|
|
2,964
|
|
|
3,273
|
|
|
(210
|
)
|
|
—
|
|
|
6,027
|
|
|||||
Equity in Earnings of 50% or Less Owned Companies, Net of Tax
|
|
—
|
|
|
562
|
|
|
—
|
|
|
—
|
|
|
562
|
|
|||||
Equity in Earnings (Losses) of Subsidiaries
|
|
3,625
|
|
|
—
|
|
|
—
|
|
|
(3,625
|
)
|
|
—
|
|
|||||
Net Income (Loss)
|
|
6,589
|
|
|
3,835
|
|
|
(210
|
)
|
|
(3,625
|
)
|
|
6,589
|
|
|||||
Net Loss attributable to Noncontrolling Interest in Subsidiary
|
|
—
|
|
|
105
|
|
|
—
|
|
|
—
|
|
|
105
|
|
|||||
Net Income (Loss) attributable to Era Group Inc.
|
|
6,589
|
|
|
3,940
|
|
|
(210
|
)
|
|
(3,625
|
)
|
|
6,694
|
|
|||||
Accretion of redemption value on Series A Preferred Stock
|
|
721
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
721
|
|
|||||
Net Income (Loss) attributable to Common Shares
|
|
$
|
5,868
|
|
|
$
|
3,940
|
|
|
$
|
(210
|
)
|
|
$
|
(3,625
|
)
|
|
$
|
5,973
|
|
Supplemental Condensed Consolidating Statement of Operations for the Three Months Ended March 31, 2012
|
||||||||||||||||||||
|
|
Parent Company Only
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Operating Revenues
|
|
$
|
—
|
|
|
$
|
61,052
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
61,052
|
|
Costs and Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating
|
|
—
|
|
|
39,676
|
|
|
—
|
|
|
—
|
|
|
39,676
|
|
|||||
Administrative and general
|
|
2,618
|
|
|
7,058
|
|
|
1
|
|
|
—
|
|
|
9,677
|
|
|||||
Depreciation
|
|
—
|
|
|
9,630
|
|
|
—
|
|
|
—
|
|
|
9,630
|
|
|||||
|
|
2,618
|
|
|
56,364
|
|
|
1
|
|
|
—
|
|
|
58,983
|
|
|||||
Gains on Asset Dispositions and Impairments, Net
|
|
—
|
|
|
1,765
|
|
|
—
|
|
|
—
|
|
|
1,765
|
|
|||||
Operating Income (Loss)
|
|
(2,618
|
)
|
|
6,453
|
|
|
(1
|
)
|
|
—
|
|
|
3,834
|
|
|||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest income
|
|
34
|
|
|
298
|
|
|
—
|
|
|
—
|
|
|
332
|
|
|||||
Interest expense
|
|
(1,672
|
)
|
|
(296
|
)
|
|
—
|
|
|
—
|
|
|
(1,968
|
)
|
|||||
Intercompany interest
|
|
3,734
|
|
|
(3,734
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
SEACOR management fees
|
|
(500
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(500
|
)
|
|||||
Derivative losses, net
|
|
—
|
|
|
(124
|
)
|
|
—
|
|
|
—
|
|
|
(124
|
)
|
|||||
Foreign currency gains, net
|
|
—
|
|
|
917
|
|
|
—
|
|
|
—
|
|
|
917
|
|
|||||
Other, net
|
|
—
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|||||
|
|
1,596
|
|
|
(2,909
|
)
|
|
—
|
|
|
—
|
|
|
(1,313
|
)
|
|||||
Income (Loss) Before Income Tax Expense (Benefit) and Equity in Earnings (Losses) of 50% or Less Owned Companies and Subsidiaries
|
|
(1,022
|
)
|
|
3,544
|
|
|
(1
|
)
|
|
—
|
|
|
2,521
|
|
|||||
Income Tax Expense (Benefit)
|
|
(356
|
)
|
|
1,090
|
|
|
—
|
|
|
—
|
|
|
734
|
|
|||||
Income (Loss) Before Equity in Earnings (Losses) of 50% or Less Owned Companies and Subsidiaries
|
|
(666
|
)
|
|
2,454
|
|
|
(1
|
)
|
|
—
|
|
|
1,787
|
|
|||||
Equity in Losses of 50% or Less Owned Companies, Net of Tax
|
|
—
|
|
|
(6,420
|
)
|
|
—
|
|
|
—
|
|
|
(6,420
|
)
|
|||||
Equity in Earnings (Losses) of Subsidiaries
|
|
(3,967
|
)
|
|
—
|
|
|
—
|
|
|
3,967
|
|
|
—
|
|
|||||
Net Loss attributable to Era Group Inc.
|
|
(4,633
|
)
|
|
(3,966
|
)
|
|
(1
|
)
|
|
3,967
|
|
|
(4,633
|
)
|
|||||
Accretion of redemption value on Series A Preferred Stock
|
|
2,100
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,100
|
|
|||||
Net Loss attributable to Common Shares
|
|
$
|
(6,733
|
)
|
|
$
|
(3,966
|
)
|
|
$
|
(1
|
)
|
|
$
|
3,967
|
|
|
$
|
(6,733
|
)
|
Supplemental Statement of Comprehensive Income (Loss) for the Three Months Ended March 31, 2013
|
||||||||||||||||||||
|
|
Parent Company Only
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Net Income
|
|
$
|
6,589
|
|
|
$
|
3,835
|
|
|
$
|
(210
|
)
|
|
$
|
(3,625
|
)
|
|
$
|
6,589
|
|
Other Comprehensive Income (Loss):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency translation adjustments
|
|
(162
|
)
|
|
(162
|
)
|
|
—
|
|
|
162
|
|
|
(162
|
)
|
|||||
Income tax benefit
|
|
57
|
|
|
57
|
|
|
—
|
|
|
(57
|
)
|
|
57
|
|
|||||
|
|
(105
|
)
|
|
(105
|
)
|
|
—
|
|
|
105
|
|
|
(105
|
)
|
|||||
Comprehensive Income (Loss)
|
|
6,484
|
|
|
3,730
|
|
|
(210
|
)
|
|
(3,520
|
)
|
|
6,484
|
|
|||||
Comprehensive Income (Loss) attributable to Noncontrolling Interest in Subsidiary
|
|
105
|
|
|
105
|
|
|
—
|
|
|
(105
|
)
|
|
105
|
|
|||||
Comprehensive Income (Loss) attributable to Era Group Inc.
|
|
$
|
6,379
|
|
|
$
|
3,835
|
|
|
$
|
(210
|
)
|
|
$
|
(3,415
|
)
|
|
$
|
6,589
|
|
Supplemental Statement of Comprehensive Income (Loss) for the Three Months Ended March 31, 2012
|
||||||||||||||||||||
|
|
Parent Company Only
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Net Loss
|
|
$
|
(4,633
|
)
|
|
$
|
(3,966
|
)
|
|
$
|
(1
|
)
|
|
$
|
3,967
|
|
|
$
|
(4,633
|
)
|
Other Comprehensive Income:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency translation adjustments
|
|
980
|
|
|
980
|
|
|
—
|
|
|
(980
|
)
|
|
980
|
|
|||||
Income tax expense
|
|
(343
|
)
|
|
(343
|
)
|
|
—
|
|
|
343
|
|
|
(343
|
)
|
|||||
|
|
637
|
|
|
637
|
|
|
—
|
|
|
(637
|
)
|
|
637
|
|
|||||
Comprehensive Income (Loss) attributable to Era Group Inc.
|
|
$
|
(3,996
|
)
|
|
$
|
(3,329
|
)
|
|
$
|
(1
|
)
|
|
$
|
3,330
|
|
|
$
|
(3,996
|
)
|
Supplemental Condensed Consolidating Statement of Cash Flows for the Three Months Ended March 31, 2013
|
||||||||||||||||||||
|
|
Parent Company Only
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Net cash provided by operating activities
|
|
$
|
10,502
|
|
|
$
|
6,884
|
|
|
$
|
491
|
|
|
$
|
—
|
|
|
$
|
17,877
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchases of property and equipment
|
|
—
|
|
|
(19,445
|
)
|
|
—
|
|
|
—
|
|
|
(19,445
|
)
|
|||||
Proceeds from disposition of property and equipment
|
|
—
|
|
|
19,099
|
|
|
—
|
|
|
—
|
|
|
19,099
|
|
|||||
Principal payments on notes due from equity investees
|
|
—
|
|
|
535
|
|
|
—
|
|
|
—
|
|
|
535
|
|
|||||
Principal payments on third party notes receivable, net
|
|
—
|
|
|
347
|
|
|
—
|
|
|
—
|
|
|
347
|
|
|||||
Net cash provided by investing activities
|
|
—
|
|
|
536
|
|
|
—
|
|
|
—
|
|
|
536
|
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from issuance of long-term debt
|
|
15,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,000
|
|
|||||
Payments on long-term debt
|
|
(15,000
|
)
|
|
(697
|
)
|
|
—
|
|
|
—
|
|
|
(15,697
|
)
|
|||||
Dividends paid on Series A preferred stock
|
|
(4,953
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,953
|
)
|
|||||
Proceeds and tax benefits from share award plans
|
|
89
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
89
|
|
|||||
Settlement of SEACOR options with Era Group options
|
|
706
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
706
|
|
|||||
Net cash used in financing activities
|
|
(4,158
|
)
|
|
(697
|
)
|
|
—
|
|
|
—
|
|
|
(4,855
|
)
|
|||||
Effects of Exchange Rate Changes on Cash and Cash Equivalents
|
|
(105
|
)
|
|
74
|
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
|||||
Net Increase in Cash and Cash Equivalents
|
|
6,239
|
|
|
6,797
|
|
|
491
|
|
|
—
|
|
|
13,527
|
|
|||||
Cash and Cash Equivalents, Beginning of Year
|
|
2,258
|
|
|
8,558
|
|
|
689
|
|
|
—
|
|
|
11,505
|
|
|||||
Cash and Cash Equivalents, End of Year
|
|
$
|
8,497
|
|
|
$
|
15,355
|
|
|
$
|
1,180
|
|
|
$
|
—
|
|
|
$
|
25,032
|
|
Supplemental Condensed Consolidating Statement of Cash Flows for the Three Months Ended March 31, 2012
|
||||||||||||||||||||
|
|
Parent Company Only
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Net cash provided by (used in) operating activities
|
|
$
|
(75,272
|
)
|
|
$
|
34,967
|
|
|
$
|
—
|
|
|
$
|
593
|
|
|
$
|
(39,712
|
)
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchases of property and equipment
|
|
—
|
|
|
(54,272
|
)
|
|
—
|
|
|
—
|
|
|
(54,272
|
)
|
|||||
Proceeds from disposition of property and equipment
|
|
—
|
|
|
2,935
|
|
|
—
|
|
|
—
|
|
|
2,935
|
|
|||||
Cash settlements on derivative transactions, net
|
|
—
|
|
|
(98
|
)
|
|
—
|
|
|
—
|
|
|
(98
|
)
|
|||||
Principal payments on notes due from equity investees
|
|
—
|
|
|
439
|
|
|
—
|
|
|
—
|
|
|
439
|
|
|||||
Principal payments on third party notes receivable, net
|
|
—
|
|
|
346
|
|
|
—
|
|
|
—
|
|
|
346
|
|
|||||
Net cash used in investing activities
|
|
—
|
|
|
(50,650
|
)
|
|
—
|
|
|
—
|
|
|
(50,650
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
—
|
|
|||||||||
Proceeds from issuance of long-term debt
|
|
38,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38,000
|
|
|||||
Payments on long-term debt
|
|
—
|
|
|
(697
|
)
|
|
—
|
|
|
—
|
|
|
(697
|
)
|
|||||
Net cash provided by (used in) financing activities
|
|
38,000
|
|
|
(697
|
)
|
|
—
|
|
|
—
|
|
|
37,303
|
|
|||||
Effects of Exchange Rate Changes on Cash and Cash Equivalents
|
|
593
|
|
|
810
|
|
|
—
|
|
|
(593
|
)
|
|
810
|
|
|||||
Net Decrease in Cash and Cash Equivalents
|
|
(36,679
|
)
|
|
(15,570
|
)
|
|
—
|
|
|
—
|
|
|
(52,249
|
)
|
|||||
Cash and Cash Equivalents, Beginning of Year
|
|
63,044
|
|
|
16,078
|
|
|
—
|
|
|
—
|
|
|
79,122
|
|
|||||
Cash and Cash Equivalents, End of Year
|
|
$
|
26,365
|
|
|
$
|
508
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
26,873
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
the effect of the Spin-off, including the ability of the Company to recognize the expected benefits from the Spin-off and the Company's dependence on SEACOR's performance under various agreements;
|
•
|
decreased demand and loss of revenues resulting from developments that may adversely impact the offshore oil and gas industry, including the issuance of new safety and environmental guidelines or regulations that could increase the costs of exploration and production, reduce the area of operations and result in permitting delays, U.S. government implemented moratoriums directing operators to cease certain drilling activities and any extension of such moratoriums that may result in unplanned customer suspensions, cancellations, rate reductions or non-renewals of aviation equipment contracts or failures to finalize commitments to contract aviation equipment;
|
•
|
safety issues experienced by a particular helicopter model that could result in customers refusing to use that helicopter model or a regulatory body grounding that helicopter model, which could also permanently devalue that helicopter model;
|
•
|
the cyclical nature of the oil and gas industry;
|
•
|
increased U.S. and foreign government legislation and regulation, including environmental and aviation laws and regulations, and the Company's compliance therewith and the costs thereof;
|
•
|
dependence on the activity in the U.S. Gulf of Mexico and Alaska and the Company's ability to expand into other markets;
|
•
|
liability, legal fees and costs in connection with providing emergency response services, including involvement in response to the oil spill that resulted from the sinking of the Deepwater Horizon in April 2010;
|
•
|
decreased demand for the Company's services as a result of declines in the global economy;
|
•
|
declines in valuations in the global financial markets and a lack of liquidity in the credit sectors, including interest rate fluctuations, availability of credit, inflation rates, change in laws, trade barriers, commodity prices and currency exchange fluctuations;
|
•
|
activity in foreign countries and changes in foreign political, military and economic conditions;
|
•
|
the failure to maintain an acceptable safety record;
|
•
|
the dependence on a small number of customers;
|
•
|
consolidation of the Company's customer base;
|
•
|
the ongoing need to replace aging aircraft;
|
•
|
industry fleet capacity;
|
•
|
restrictions imposed by the U.S. federal aviation laws and regulations on the amount of foreign ownership of the Company's common stock;
|
•
|
operational risks;
|
•
|
risks associated with our debt structure;
|
•
|
effects of adverse weather conditions and seasonality;
|
•
|
adequacy of insurance coverage;
|
•
|
the attraction and retention of qualified personnel; and
|
•
|
various other matters and factors, many of which are beyond the Company's control.
|
|
|
Three Months Ended March 31,
|
||||||||||
|
|
2013
|
|
2012
|
||||||||
|
|
$’000
|
|
%
|
|
$’000
|
|
%
|
||||
Operating Revenues:
|
|
|
|
|
|
|
|
|
||||
United States
|
|
53,042
|
|
|
78
|
|
|
46,230
|
|
|
76
|
|
Foreign
|
|
14,685
|
|
|
22
|
|
|
14,822
|
|
|
24
|
|
|
|
67,727
|
|
|
100
|
|
|
61,052
|
|
|
100
|
|
Costs and Expenses:
|
|
|
|
|
|
|
|
|
||||
Operating
|
|
|
|
|
|
|
|
|
||||
Personnel
|
|
17,134
|
|
|
25
|
|
|
15,707
|
|
|
26
|
|
Repairs and maintenance
|
|
12,438
|
|
|
18
|
|
|
10,298
|
|
|
17
|
|
Insurance and loss reserves
|
|
2,481
|
|
|
4
|
|
|
2,746
|
|
|
4
|
|
Fuel
|
|
5,250
|
|
|
8
|
|
|
4,619
|
|
|
7
|
|
Leased-in equipment
|
|
430
|
|
|
1
|
|
|
445
|
|
|
1
|
|
Other
|
|
5,383
|
|
|
8
|
|
|
5,861
|
|
|
10
|
|
|
|
43,116
|
|
|
64
|
|
|
39,676
|
|
|
65
|
|
Administrative and general
|
|
9,134
|
|
|
13
|
|
|
9,677
|
|
|
16
|
|
Depreciation
|
|
11,661
|
|
|
17
|
|
|
9,630
|
|
|
16
|
|
|
|
63,911
|
|
|
94
|
|
|
58,983
|
|
|
97
|
|
Gains on Asset Dispositions and Impairments, Net
|
|
10,801
|
|
|
16
|
|
|
1,765
|
|
|
3
|
|
Operating Income
|
|
14,617
|
|
|
22
|
|
|
3,834
|
|
|
6
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
||||
Interest income
|
|
147
|
|
|
—
|
|
|
332
|
|
|
—
|
|
Interest expense
|
|
(4,732
|
)
|
|
(7
|
)
|
|
(1,968
|
)
|
|
(3
|
)
|
SEACOR management fees
|
|
(168
|
)
|
|
—
|
|
|
(500
|
)
|
|
(1
|
)
|
Derivative losses, net
|
|
(3
|
)
|
|
—
|
|
|
(124
|
)
|
|
—
|
|
Foreign currency gains (losses), net
|
|
(259
|
)
|
|
(1
|
)
|
|
917
|
|
|
2
|
|
Other, net
|
|
3
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
|
(5,012
|
)
|
|
(8
|
)
|
|
(1,313
|
)
|
|
(2
|
)
|
Income Before Income Tax Expense and Equity in Earnings (Losses) of 50% or Less Owned Companies
|
|
9,605
|
|
|
14
|
|
|
2,521
|
|
|
4
|
|
Income Tax Expense
|
|
3,578
|
|
|
5
|
|
|
734
|
|
|
1
|
|
Income Before Equity in Earnings (Losses) of 50% or Less Owned Companies
|
|
6,027
|
|
|
9
|
|
|
1,787
|
|
|
3
|
|
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
|
|
562
|
|
|
1
|
|
|
(6,420
|
)
|
|
(11
|
)
|
Net Income (Loss)
|
|
6,589
|
|
|
10
|
|
|
(4,633
|
)
|
|
(8
|
)
|
Net Loss attributable to Noncontrolling Interest
|
|
105
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Net Income (Loss) attributable to Era Group Inc.
|
|
6,694
|
|
|
10
|
|
|
(4,633
|
)
|
|
(8
|
)
|
Accretion of Redemption Value on Series A Preferred Stock
|
|
721
|
|
|
1
|
|
|
2,100
|
|
|
3
|
|
Net Income (Loss) attributable to Common Shares
|
|
5,973
|
|
|
9
|
|
|
(6,733
|
)
|
|
(11
|
)
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2013
|
|
2012
|
||||
Net Income (Loss) Attributable to Common Shares
|
|
5,973
|
|
|
(6,733
|
)
|
||
Average Shares Outstanding
|
|
19,915,590
|
|
|
19,883,583
|
|
||
Per Share, on an adjusted basis
|
|
$
|
0.30
|
|
|
$
|
(0.34
|
)
|
|
Owned
|
|
Joint
Ventured
|
|
Leased-in
|
|
Managed
|
|
Total
|
|||||
2013
|
|
|
|
|
|
|
|
|
|
|||||
Light helicopters – single engine
|
52
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
59
|
|
Light helicopters – twin engine
|
27
|
|
|
—
|
|
|
6
|
|
|
5
|
|
|
38
|
|
Medium helicopters
|
64
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
67
|
|
Heavy helicopters
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
152
|
|
|
8
|
|
|
7
|
|
|
6
|
|
|
173
|
|
2012
|
|
|
|
|
|
|
|
|
|
|||||
Light helicopters – single engine
|
52
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
58
|
|
Light helicopters – twin engine
|
30
|
|
|
—
|
|
|
6
|
|
|
10
|
|
|
46
|
|
Medium helicopters
|
61
|
|
|
1
|
|
|
1
|
|
|
3
|
|
|
66
|
|
Heavy helicopters
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
151
|
|
|
7
|
|
|
7
|
|
|
13
|
|
|
178
|
|
Summary of Cash Flows
|
|||||
|
Three Months Ended March 31,
|
||||
|
2013
|
|
2012
|
||
|
$’000
|
|
$’000
|
||
Cash flows provided by or (used in):
|
|
|
|
||
Operating Activities
|
17,877
|
|
|
(39,712
|
)
|
Investing Activities
|
536
|
|
|
(50,650
|
)
|
Financing Activities
|
(4,855
|
)
|
|
37,303
|
|
Effect of Exchange Rate Changes on Cash and Cash Equivalents
|
(31
|
)
|
|
810
|
|
Net Increase (Decrease) in Cash and Cash Equivalents
|
13,527
|
|
|
(52,249
|
)
|
|
Three Months Ended March 31,
|
||||
|
2013
|
|
2012
|
||
|
$’000
|
|
$’000
|
||
Operating income from continuing operations before depreciation and gains on asset dispositions and impairments, net
|
15,477
|
|
|
11,699
|
|
Changes in operating assets and liabilities before interest and income taxes
|
3,016
|
|
|
(49,802
|
)
|
Cash settlements on derivative transactions, net
|
(117
|
)
|
|
—
|
|
Interest paid, excluding capitalized interest
|
(708
|
)
|
|
(1,671
|
)
|
Income taxes paid, net
|
2
|
|
|
2
|
|
SEACOR management fees
|
(168
|
)
|
|
(500
|
)
|
Other
|
375
|
|
|
560
|
|
Total cash flows provided by operating activities
|
17,877
|
|
|
(39,712
|
)
|
•
|
Capital expenditures were $19.4 million, which consisted primarily of a helicopter acquisition and deposits on future helicopter deliveries.
|
•
|
Proceeds from the disposition of property and equipment were $19.1 million.
|
•
|
Net principal payments from third-party notes receivable were $0.5 million.
|
•
|
Capital expenditures, consisting primarily of helicopter acquisitions, were $54.3 million.
|
•
|
Proceeds from the disposition of property and equipment were $2.9 million.
|
•
|
Net principal payments on notes due from equity investees were $0.4 million.
|
•
|
Net principal payments from third-party notes receivable were $0.3 million.
|
•
|
Dividends paid on Series A preferred stock of $5.0 million.
|
•
|
Proceeds from SEACOR on the settlement of stock options of $0.7 million.
|
•
|
Net principal payments on long-term debt were $0.7 million.
|
•
|
Proceeds from issuance of long-term debt were $38.0 million.
|
•
|
Net principal payments on long-term debt were $0.7 million.
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
ITEM 6.
|
EXHIBITS
|
**
|
Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.
|
|
|
|
|
Era Group Inc. (Registrant)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DATE:
|
May 14, 2013
|
By:
|
|
/s/ Sten L. Gustafson
|
|
|
|
|
|
Sten L. Gustafson,
Chief Executive Officer
|
|
|
|
|
|
|
|
DATE:
|
May 14, 2013
|
By:
|
|
/s/ Christopher S. Bradshaw
|
|
|
|
|
|
Christopher S. Bradshaw,
Executive Vice President and Chief Financial Officer
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**
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Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.
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a.
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Subject to the terms and conditions set forth herein and in the Plan the Restricted Stock shall vest [in equal installments on each of the first four anniversaries]
4
[as to 100% of the Restricted Stock on the first anniversary]
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of the Date of Grant.
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(i)
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the death of the Grantee;
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(ii)
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the Grantee becomes disabled (as defined below); or
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(iii)
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the occurrence of a Change in Control of the Company.
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b.
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As used in this Agreement, “Disabled” shall mean that by reason of injury or illness (including mental illness) the Grantee shall be unable to perform his or her director duties for ninety (90) consecutive days or 120 days in a 12 month period.
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a.
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The Grantee has the legal right and capacity to enter into this Agreement and fully understands the terms and conditions of this Agreement.
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b.
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The Grantee is acquiring the Restricted Stock for investment purposes only and not with a view to, or in connection with, the public distribution thereof in violation of the United States Securities Act of 1933, as amended (the “
Securities Act
”).
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c.
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The Grantee understands and agrees that none of the shares of the Restricted Stock may be offered, sold, assigned, transferred, pledged, hypothecated or otherwise disposed of except in compliance with this Agreement and the Securities Act pursuant to an effective registration statement or applicable exemption from the registration requirements of the Securities Act and applicable state securities or “blue sky” laws, and then only in accordance with the Era Group Inc. Insider Trading and Tipping Policy (the “
Insider Trading Policy
”). The Grantee further understands that the Company has no obligation to cause or to refrain from causing the resale of any of the shares of the Restricted Stock or any other shares of its capital stock to be registered under the Securities Act or to comply with any exemption under the Securities Act which would permit the shares of the Restricted Stock to be sold or otherwise transferred by the Grantee. The Grantee further understands that, without approval in writing pursuant to the Insider Trading Policy, no trade may be executed in any interest or position relating to the future price of Company securities, such as a put option, call option, or short sale (which prohibition includes, among other things, establishing any “collar” or other mechanism for the purpose of establishing a price).
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Era Group, Inc.
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Sten Gustafson
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Chief Executive Officer
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Name:
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[•]
6
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Subsidiary
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Jurisdiction of Organization
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Aeróleo Internacional, LLC
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Delaware
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Aeróleo Táxi Aéreo S/A
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Brazil
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Apical Industries, Inc.
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California
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Dart Aerospace Ltd.
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Alberta, Canada
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Dart Aerospace USA, Inc.
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Washington
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Dart Helicopter Services Canada Inc.
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Ontario, Canada
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Dart Helicopter Services, Inc.
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Delaware
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Dart Holding Company Ltd.
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Alberta, Canada
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Dart Sales Inc.
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Alberta, Canada
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Era Aeróleo LLC
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Delaware
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Era Australia LLC
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Delaware
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Era Canada LLC
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Delaware
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Era DHS LLC
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Delaware
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Era Do Brazil LLC
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Delaware
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Era FBO LLC
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Delaware
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Era Flightseeing LLC
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Delaware
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Era Helicopter Services LLC
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Delaware
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Era Helicópteros de México S. de R.L. de C.V.
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Mexico
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Era Helicopters (Mexico) LLC
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Delaware
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Era Helicopters, LLC
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Delaware
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Era Leasing LLC
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Delaware
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Era Med LLC
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Delaware
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Era Training Center LLC
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Delaware
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Heli-Union Era Australia Pty Ltd
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Australia
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Geneva Aviation Incorporated
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Delaware
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Lake Palma, S.L.
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Spain
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Offshore Helicopter Support Services, Inc.
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Louisiana
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SEACOR Overseas Investment Inc.
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Delaware
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Star Aviation Crewing Ltd.
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British Virgin Islands
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1.
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I have reviewed this quarterly report on Form 10−Q of Era Group Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a−15(e) and 15d−15(e)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
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c)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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May 14, 2013
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/s/ Sten L. Gustafson
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Name:
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Sten L. Gustafson
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Title:
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Chief Executive Officer
(Principal Executive Officer) |
1.
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I have reviewed this quarterly report on Form 10−Q of Era Group Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a−15(e) and 15d−15(e)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
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c)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions:
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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May 14, 2013
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/
S
/ Christopher S. Bradshaw
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Name:
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Christopher S. Bradshaw
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Title:
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Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
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/
S
/ Sten L. Gustafson
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Sten L. Gustafson
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Chief Executive Officer
(Principal Executive Officer) |
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S
/ Christopher S. Bradshaw
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Christopher S. Bradshaw
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Executive Vice President and
Chief Financial Officer (Principal Financial Officer) |