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Bristow Group Inc. (NYSE:VTOL), a leading global provider of vertical flight solutions, presented its first quarter 2025 earnings results on May 7, 2025, showing stable overall performance despite varying results across business segments. The company maintained consistent Adjusted EBITDA compared to the previous quarter while announcing plans to initiate a quarterly dividend program beginning in Q1 2026.
Quarterly Performance Highlights
Bristow reported Q1 2025 revenues of $351 million, a slight decrease from $354 million in Q4 2024, while Adjusted EBITDA remained steady at $58 million. The company’s performance was supported by its diversified business model spanning offshore energy, government services, and other aviation services across multiple geographic regions.
As shown in the following overview of Bristow’s global operations and revenue mix:
The company operates on six continents serving customers in 18 countries with a workforce of 3,469 employees, including 906 pilots and 917 engineers. Bristow’s fleet consists of 211 aircraft, with revenue distribution showing 68% from Offshore Energy Services, 24% from Government Services, and 8% from Other Services. Geographically, Europe accounts for 52% of revenues, followed by the Americas (28%), Africa (13%), and Asia Pacific (7%).
The quarter’s consolidated financial results demonstrate the company’s stable performance despite seasonal factors:
Segment Performance Analysis
Bristow’s three business segments showed divergent performance in Q1 2025, with Government Services growing, Offshore Energy Services maintaining stable revenues with improved margins, and Other Services experiencing a seasonal decline.
The Offshore Energy Services segment, which accounts for the largest portion of Bristow’s business, maintained revenues at $240 million while improving Adjusted Operating Income to $47 million, up from $44 million in the previous quarter:
The improvement in operating income was primarily driven by lower repairs and maintenance expenses of $7.1 million, partially offset by increased training costs and the absence of property tax savings from the previous quarter.
Meanwhile, the Government Services segment showed strong growth with revenues increasing to $86 million from $83 million in Q4 2024, and Adjusted Operating Income rising significantly to $14 million from $10 million:
This growth was primarily attributed to the Irish Coast Guard contract, which began its transition in late 2024. The segment’s performance highlights Bristow’s successful expansion in the government services sector, which now represents a substantial portion of the company’s contractual backlog.
The Other Services segment, however, experienced a seasonal decline with revenues falling to $25 million from $31 million in Q4 2024, and Adjusted Operating Income decreasing to $2 million from $7 million. This decline was primarily due to lower utilization resulting from seasonality in Australia, unfavorable foreign exchange rate impacts, and lower dry-leasing revenues.
Balance Sheet and Backlog Strength
Bristow maintains a strong financial position with $191.1 million in unrestricted cash and total liquidity of $254.3 million as of March 31, 2025. The company’s debt maturity profile is well-structured, with manageable annual repayments:
The company’s contractual backlog stands at approximately $4.2 billion, providing significant revenue visibility through 2028. Government Services accounts for 73% of the total backlog, reflecting the long-term nature of these contracts:
Bristow’s strong backlog is supported by two major government contracts: the £1.6 billion UKSAR2G contract and the €670 million Irish Coast Guard contract, both with 10-year terms plus extension options. These contracts require capital investments, with $258 million (86%) of the total $300 million investment already completed.
Strategic Initiatives and Outlook
Looking ahead, Bristow has affirmed its financial outlook for 2025 and 2026, projecting continued growth:
The company expects 2025 revenues between $1,420-$1,615 million and Adjusted EBITDA of $230-$260 million, with further growth in 2026 to revenues of $1,525-$1,775 million and Adjusted EBITDA of $275-$335 million.
Bristow’s capital allocation framework includes protecting its balance sheet, pursuing growth opportunities, and returning capital to shareholders. The company plans to pay down debt to approximately $500 million by the end of 2026, complete transitions of new government contracts, upgrade its fleet, and initiate a quarterly dividend program beginning in Q1 2026, with an initial dividend of $0.125 per share ($0.50 per share annualized).
Market conditions for offshore helicopters remain favorable for Bristow, with tight capacity supporting pricing power:
The effective utilization rates for heavy and medium offshore helicopters remain extremely high at 98% for S-92, AW189, and H175 helicopters, and 91% for AW139 helicopters. This tight market is attributed to assets retired during the last downturn, lack of new helicopter deliveries, long lead-times for new builds, and supply chain challenges.
Additionally, approximately 58% of Offshore Energy Services contracts are yet to reset, suggesting potential for rate increases as these contracts are renewed in the current tight market environment.
Bristow’s stock closed at $29.49 on May 6, 2025, representing a slight decrease of 0.37% from the previous close. The company’s shares have traded between $25.11 and $41.50 over the past 52 weeks, reflecting market volatility despite the company’s stable operational performance and strong backlog.
Full presentation:
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