MRO Magazine

CHC Group Reports Fiscal-2015 Third-Quarter Financial Results


March 16, 2015
By Business Wire News

VANCOUVER, British Columbia

CHC Group (NYSE:HELI), the parent company of CHC Helicopter, reported revenue of $415 million and a net loss of $465 million for its fiscal-2015 third quarter, which ended Jan. 31. Revenue declined 9 percent, largely driven by the impact of currency. Excluding the impact of currency, revenue declined about 2 percent.

The company had an adjusted net loss of $30 million, which excluded the effect of $442 million in special items, including a non-cash charge of $404 million, or $5.00 per share, for the impairment of goodwill. This impairment does not affect operations or cash flow. Adjusted EBITDAR (earnings before interest, taxes, depreciation and amortization and helicopter lease and other costs) excluding special items was $115 million, a decline of 3 percent. Excluding the impact of currency, adjusted EBITDAR excluding special items was up modestly.

All references to EBITDAR in this release represent adjusted EBITDAR excluding special items. Unless otherwise noted, all comparisons are year-over-year.

(Periods ended Jan. 31; US$ in
millions, except EPS data)

 Quarter    Year-to-date
FY14  FY15  % ChangeFY14  FY15  % Change
As reported:
Revenue   $ 454    $415     (9)% $ 1,312    $1,334     2%
Operating revenue1   412    382     (7)% 1,188    1,218     2%
Operating income (loss)   6    (394)   16    (510)  
Net earnings (loss)   (58 )  (465)   (145 )  (676)  
Controlling interest   (60 )  (471)   (149 )  (697)  
Non-controlling interests   2    7     4    21    
Net loss per ordinary share2   $ (1.16 )  $(5.83)   $ (3.10 )  $(9.02)  

Weighted average number of
ordinary stock outstanding –
basic and diluted

  51,573,832    80,639,313     56% 48,204,267    80,589,721     67%
Adjusted3:
EBITDAR excluding special items4   119    115     (3)% 339    352     4%
Margin5   29 %  30%   130bps 29 %  29%   40bps
Net loss6   (25 )  (30)   (83 )  (92)  
Net loss per ordinary share7   $ (0.32 )  $(0.50)   $ (1.07 )  $(1.27)  
Share count8   77,519,484    80,639,313     4% 77,519,484    80,589,721     4%
1.   Operating revenue is total revenue less reimbursable revenue, which is costs reimbursed from customers.
2. Net loss per ordinary share is calculated by net loss available to common stockholders, divided by weighted average number of ordinary stock outstanding – basic and diluted. Refer to Page 5 for reconciliation from net loss to net loss available to common stockholders.
3. See a description of non-GAAP financial measures and reconciliation to comparable GAAP measures on Pages 9, 10, 11 and 12.
4. Corporate transaction costs were excluded from EBITDAR. See a description of non-GAAP financial measures and reconciliation to comparable GAAP measures on Pages 9, 10, 11 and 12.
5. Adjusted EBITDAR margin excluding special items is calculated as EBITDAR as a percentage of operating revenue.
6. Adjusted net loss excludes corporate transaction costs, asset dispositions, asset impairments, restructuring expense, debt extinguishment, the revaluation of our derivatives and foreign-exchange gain (loss), and net income or loss attributable to non-controlling interests.
7. Adjusted net loss per share is calculated by dividing adjusted net loss available to common stockholders by adjusted share count. Refer to Page 11 for reconciliation to comparable GAAP measures.
8. Adjusted share count is the number of ordinary shares outstanding at the date of our initial public offering for the prior-year quarter and prior-year period, and the weighted average for the current-year quarter and current-year period.

INDUSTRY ENVIRONMENT

Oil-and-gas customers are significantly reducing their capital and operating expenses amid sharply lower crude-oil prices, which is affecting demand for both offshore flying services and helicopter maintenance, repair and overhaul (MRO) services.

Karl Fessenden, CHC president and chief executive officer:

“Despite the current uncertainty in the oil-and-gas industry, we believe the long-term demand for CHC’s services – especially transportation to deepwater and ultra-deepwater oil-and-gas production locations, which represents about 80 percent of our flying revenue – will grow. In the short-term, however, we are intensely focused on reducing CHC’s cost structure and improving capital efficiency to match the market environment, while maintaining an absolute commitment to industry-leading safety, availability and reliability.”

Joan Hooper, CHC chief financial officer:

“In the quarter we continued to strengthen the balance sheet and lowered fixed costs. Leverage declined to 4.8x, we retired $235 million of long-term debt, and we ended the quarter with $580 million in liquidity comprised of cash on the balance sheet and undrawn credit facilities.”

BUSINESS SEGMENTS

Helicopter Services (flying)

Revenue of $375 million was down 10 percent, largely driven by the negative impact of currency translation, which contributed 6 points to the decline. However, EBITDAR dollars were flat, reflecting improvement in the EBITDAR margin for flying services. The EBITDAR margin was augmented by new contracts and lower maintenance costs resulting from the company’s global inventory and supply chain initiatives.

Heli-One (MRO)

Heli-One’s third-party revenue, which benefited from gains in both MRO and power-by-the-hour customers, increased 9 percent to $40 million. EBITDAR declined 17 percent due to lower internal revenue.

CLAYTON, DUBILIER & RICE (CD&R) TRANSACTION

As previously announced, during the third quarter CHC completed a private placement of convertible preferred shares to funds managed by CD&R. The total net proceeds from the private placement were $572 million, $463 million of which were received by CHC during the third quarter. The net proceeds are being used to reduce fixed expenses, such as debt and lease costs; strengthen CHC’s financial position; and improve cash flow over time.

In addition, changes were made to the CHC board of directors concurrent with CD&R’s investment:

  • John Krenicki, a CD&R partner and former president and CEO of GE Energy, joined the board and serves as chairman,
  • Other changes to the company’s board included the appointment of Nathan Sleeper, a CD&R partner, and Robert Volpe, a CD&R principal, as directors, and
  • In February, Karl Fessenden, a former executive and nearly 20-year veteran of GE’s Aviation and Energy business segments, was named CHC’s president and chief executive officer and also joined CHC’s board of directors.

DEBT, LIQUIDITY AND LEVERAGE

Through the third quarter, CHC deployed net proceeds from the CD&R transaction to retire $235 million in long term debt: $105 million of senior unsecured notes, as well as an additional $130 million of long term debt through open-market bond repurchases. The retirement of this debt lowers the company’s interest expense by $22 million on an annualized basis. In addition, CHC used proceeds to increase the percentage of owned versus leased aircraft, which, in turn, is expected to lower the company’s lease expense over time.

PREFERRED SHARE DIVIDEND

In the third quarter, GAAP and adjusted earnings per share (EPS) include $11 million or 13 cents of preferred dividends paid in-kind to CD&R. For the full year we expect GAAP and adjusted EPS to reflect preferred share dividends of $24 million.

ABOUT CHC

CHC Helicopter is a leader in enabling customers to go further, do more and come home safely, including oil and gas companies, government search-and-rescue agencies and organizations requiring helicopter maintenance, repair and overhaul services through the Heli-One segment. The company operates more than 230 aircraft in about 30 countries around the world.

Additional Information

The preferred shares offered to the purchaser in the private placement have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Cautionary Note on Forward-Looking Statements

This press release contains forward-looking statements and information within the meaning of certain securities laws, including the “safe harbor” provision of the United States Private Securities Litigation Reform Act of 1995, the United States Securities Act of 1933, as amended, the United States Securities Exchange Act of 1934, as amended and other applicable securities legislation. All statements, other than statements of historical fact included in this press release, regarding as well as, our strategy, future operations, projections, conclusions, forecasts and other statements are “forward-looking statements”. While these forward-looking statements represent our best current judgment, actual results could differ materially from the conclusions, forecasts or projections contained in the forward-looking statements. Certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection in the forward-looking information contained herein. Such factors include: volatility in the oil and gas sector generally, and the potential impact of such volatility on offshore exploration and production, particularly on demand for offshore transportation services, competition in the markets we serve, our ability to secure and maintain long-term support contracts, our ability to maintain standards of acceptable safety performance, exchange rate fluctuations, political, economic, and regulatory uncertainty, problems with our non-wholly owned entities, including potential conflicts with the other owners of such entities, exposure to credit risks, our ability to continue funding our working capital requirements, risks inherent in the operation of helicopters, unanticipated costs or cost increases associated with our business operations, trade industry exposure, inflation, ability to continue maintaining government issued licenses, necessary aircraft or insurance, loss of key personnel, work stoppages due to labor disputes, and future material acquisitions or dispositions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated. The Company disclaims any intentions or obligations to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Please refer to our annual report on Form 10-K and quarterly reports on Form 10-Q, and our other filings, in particular any discussion of risk factors or forward-looking statements, which are filed with the SEC and available free of charge at the SEC’s website (www.sec.gov), for a full discussion of the risks and other factors that may impact any estimates or forward-looking statements made herein.

Consolidated Statements of Operations

(Expressed in thousands of United States dollars)

(Unaudited)

   
Three months ended Nine months ended
January 31, 2014   January 31, 2015 January 31, 2014   January 31, 2015
Operating revenue $ 412,041 $ 382,118 $ 1,188,317 $ 1,217,592
Reimbursable revenue 41,853   32,948   123,880   116,344  
Revenue 453,894 415,066 1,312,197 1,333,936
Operating expenses:
Direct costs (378,013 ) (354,272 ) (1,092,913 ) (1,127,537 )
Earnings from equity accounted investees 2,072 5,858 5,990 9,914
General and administration costs (39,182 ) (19,878 ) (77,839 ) (64,229 )
Depreciation (35,407 ) (30,794 ) (106,158 ) (97,672 )
Restructuring expense (3,441 ) (3,441 )
Asset impairments 58 (403,536 ) (22,956 ) (549,942 )
Loss on disposal of assets 2,478   (3,056 ) (1,943 ) (10,934 )
(447,994 ) (809,119 ) (1,295,819 ) (1,843,841 )
Operating income (loss) 5,900 (394,053 ) 16,378 (509,905 )
Interest on long-term debt (39,782 ) (29,996 ) (117,636 ) (99,583 )
Foreign exchange loss (11,573 ) (18,464 ) (24,476 ) (26,835 )
Other financing charges (5,730 ) (12,014 ) (1,615 ) (14,151 )
Loss before income tax (51,185 ) (454,527 ) (127,349 ) (650,474 )
Income tax expense (6,689 ) (10,189 ) (17,489 ) (25,301 )
Net loss $ (57,874 ) $ (464,716 ) $ (144,838 ) $ (675,775 )
Net earnings (loss) attributable to:
Controlling interest $ (60,003 ) $ (471,482 ) $ (149,324 ) $ (697,164 )
Non-controlling interests 2,129   6,766   4,486   21,389  
Net loss $ (57,874 ) $ (464,716 ) $ (144,838 ) $ (675,775 )
 
 
Net loss attributable to controlling interest $ (60,003 ) $ (471,482 ) $ (149,324 ) $ (697,164 )
Redeemable convertible preferred share dividends (10,883 ) (10,910 )

Adjustment of redeemable non-controlling interest to
redemption amount

  12,217     (18,996 )
Net loss available to common stockholders $ (60,003 ) $ (470,148 ) $ (149,324 ) $ (727,070 )
 

Net loss per ordinary share available to common
stockholders – basic and diluted1

$ (1.16 ) $ (5.83 ) $ (3.10 ) $ (9.02 )

Weighted average number of shares outstanding – basic
and diluted:

51,573,832 80,639,313 48,204,267 80,589,721
(1)   Net loss per ordinary share is calculated by net loss available to common stockholders divided by weighted average number of ordinary stock outstanding – basic and diluted.

Consolidated Balance Sheets

(Expressed in thousands of United States dollars)

(Unaudited)

   
April 30, 2014 January 31, 2015
Assets
Current assets:
Cash and cash equivalents $ 302,522 $ 217,080
Receivables, net of allowance for doubtful accounts of $2.3 million and $1.1 million, respectively 292,339 240,267
Income taxes receivable 28,172 19,168
Deferred income tax assets 60 49
Inventories 130,891 119,084
Prepaid expenses 27,683 25,592
Other assets 49,209   68,760  
830,876 690,000
Property and equipment, net 1,050,759 947,544
Investments 31,351 32,227
Intangible assets 177,863 172,064
Goodwill 432,376
Restricted cash 31,566 21,250
Other assets 519,306 512,050
Deferred income tax assets 3,381 1,675
Assets held for sale 26,849   15,049  
$ 3,104,327   $ 2,391,859  
Liabilities and Shareholders’ Equity (Deficit)
Current liabilities:
Payables and accruals $ 355,341 $ 311,436
Deferred revenue 30,436 36,024
Income taxes payable 41,975 43,515
Deferred income tax liabilities 98 29
Current facility secured by accounts receivable 62,596 33,218
Other liabilities 55,170 46,040
Current portion of long-term debt obligations 4,107   5,545  
549,723 475,807
Long-term debt obligations 1,546,155 1,235,908
Deferred revenue 81,485 65,158
Other liabilities 287,385 248,010
Deferred income tax liabilities 10,665   9,005  
Total liabilities 2,475,413 2,033,888
Redeemable non-controlling interests (22,578 ) 16,587
Redeemable convertible preferred shares 577,024
Capital stock 8 8
Additional paid-in capital 2,039,371 2,024,694
Deficit (1,265,103 ) (1,962,267 )
Accumulated other comprehensive loss (122,784 ) (298,075 )
651,492   (235,640 )
$ 3,104,327   $ 2,391,859  

Consolidated Statements of Cash Flows

(Expressed in thousands of United States dollars)

(Unaudited)

 
Nine months ended
January 31, 2014   January 31, 2015
Cash provided by (used in):
Operating activities:
Net loss $ (144,838 ) $ (675,775 )
Adjustments to reconcile net loss to cash flows used in operating activities:
Depreciation 106,158 97,672
Loss on disposal of assets 1,943 10,934
Asset impairments 22,956 549,942
Earnings from equity accounted investees less dividends received (3,684 ) (7,040 )
Deferred income taxes (378 ) 4,988
Non-cash stock-based compensation expense 23,148 8,524
Amortization of lease related fixed interest rate obligations (1,135 ) (274 )
Net loss on debt extinguishment 17,434
Amortization of long-term debt and lease deferred financing costs 10,246 7,581
Non-cash accrued interest income on funded residual value guarantees (4,800 ) (3,814 )
Mark to market gain on derivative instruments (8,231 ) (28,430 )
Non-cash defined benefit pension expense (income) 344 (673 )
Defined benefit contributions and benefits paid (35,559 ) (37,188 )
Decrease (increase) to deferred lease financing costs (4,228 ) 830
Unrealized loss on foreign currency exchange translation 24,843 14,145
Other 4,029 (2,613 )
Increase (decrease) in cash resulting from changes in operating assets and liabilities 29,977   (1,158 )
Cash provided by (used in) operating activities 20,791   (44,915 )
Financing activities:
Sold interest in accounts receivable, net of collections (5,173 ) (18,666 )
Net proceeds from issuance of redeemable convertible preferred shares 572,819
Proceeds from issuance of senior unsecured notes 300,000
Long-term debt proceeds 760,000 325,000
Long-term debt repayments (888,656 ) (328,055 )
Repurchases of senior secured notes (158,681 )
Redemption and repurchases of senior unsecured notes (151,683 )
Increase in deferred financing costs (14,034 )
Distribution paid to non-controlling interest (8,500 )
Related party loans (25,148 )  
Cash provided by financing activities 418,302   232,234  
Investing activities:
Property and equipment additions (474,158 ) (377,281 )
Proceeds from disposal of property and equipment 444,570 141,651
Aircraft deposits net of lease inception refunds (102,388 ) (39,122 )
Proceeds from sale of equity accounted investee 4,382
Restricted cash 8,184   5,578  
Cash used in investing activities (123,792 ) (264,792 )
Effect of exchange rate changes on cash and cash equivalents (21,957 ) (7,969 )
Change in cash and cash equivalents during the period 293,344 (85,442 )
Cash and cash equivalents, beginning of period 123,801   302,522  
Cash and cash equivalents, end of period $ 417,145   $ 217,080  

Segment Performance

(Expressed in thousands of United States dollars)

(Unaudited)

 

Segment Third-party Revenue

   
Three months ended Nine months ended
January 31, 2014   January 31, 2015 January 31, 2014 January 31, 2015
Helicopter Services operating revenue $ 375,343 $ 342,293 $ 1,088,681 $ 1,099,799
Reimbursable revenue 41,853   32,948   123,880   116,344  
Helicopter Services total external revenue 417,196 375,241 1,212,561 1,216,143
Heli-One external revenue 36,698   39,825   99,636   117,793  
Consolidated external revenue $ 453,894   $ 415,066   $ 1,312,197   $ 1,333,936  
 
 

EBITDAR Summary

 

Three months ended Nine months ended      
January 31, 2014 January 31, 2015 January 31, 2014   January 31, 2015
Helicopter Services $ 127,785 $ 127,839 $ 374,347

$

392,666
Heli-One 6,385 5,314 18,983 18,625
Corporate (39,182 ) (19,878 ) (77,839 ) (64,229 )
Eliminations (1 ) 22   (1,395 )   (637 )
Adjusted EBITDAR1 $ 94,987   $ 113,297   $ 314,096  

$

346,425  
(1)   See a description of non-GAAP financial measures and reconciliation to comparable GAAP measures below.

Non-GAAP Financial Measures:

This press release includes non-GAAP financial measures, including: adjusted net loss; earnings before interest, taxes, depreciation, amortization, helicopter lease and associated costs, asset impairments, restructuring expense, gain (loss) on disposal of assets, foreign exchange gain (loss) and other financing income (charges) or total revenue plus earnings from equity accounted investees less direct costs, excluding helicopter lease and associated costs, and general and administration expenses (“Adjusted EBITDAR”); Adjusted EBITDAR excluding special items, which excludes restructuring expense, corporate transaction costs, costs related to senior executive turnover, costs related to potential financing transactions, expenses related to the initial public offering,including costs related to restructuring our compensation plan, and other transactions, which is referred to above as “EBITDAR”; adjusted net loss per ordinary share, which is calculated by dividing adjusted net loss available to common stockholders by the number of ordinary shares outstanding at the date of our initial public offering for the prior year quarter and prior year period, and the weighted average for the current year quarter and current year period, free cash flow, which is calculated as net cash provided by operating activities less capital expenditures, and liquidity, which is calculated as cash and cash equivalents plus available borrowings under our credit facilities, that are not required by, or presented in accordance with U.S. generally accepted accounting principles (“GAAP”). These non-GAAP measures are not performance measures under GAAP and should not be considered as alternatives to net earnings (loss) or any other performance or liquidity measures derived in accordance with GAAP. In addition, these measures may not be comparable to similarly titled measures of other companies. CHC has provided a reconciliation of these non-GAAP measures to the most directly comparable GAAP measure below and above. CHC has chosen to include adjusted net loss and adjusted net loss per share as we consider these to be useful measures of our results before asset impairments, gain or loss on the disposal of assets and foreign exchange gains or losses. We have chosen to include Adjusted EBITDAR and Adjusted EBITDAR excluding special items, as we consider these to be significant indicators of our financial performance and we use these measures to assist us in allocating available capital resources. CHC has provided liquidity to demonstrate the financial flexibility that we have from period to period.CHC has provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure below and has presented a detailed discussion of its reasons for including non-GAAP financial measures and the limitations associated with those measures as part of the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in our Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K. CHC encourages investors to review the reconciliation and the non-GAAP discussion in conjunction with our presentation of these non-GAAP financial measures.

EBITDAR – Non-GAAP Reconciliation

(Expressed in thousands of United States dollars)

(Unaudited)

   
Three months ended Nine months ended
January 31, 2014   January 31, 2015 January 31, 2014   January 31, 2015
Helicopter Services $ 127,785 $ 127,839 $ 374,347 $ 392,666
Heli-One 6,385 5,314 18,983 18,625
Corporate (39,182 ) (19,878 ) (77,839 ) (64,229 )
Eliminations (1 ) 22   (1,395 ) (637 )
Adjusted EBITDAR94,987113,297314,096346,425
Helicopter lease and associated costs (56,216 ) (66,523 ) (166,661 ) (194,341 )
Depreciation (35,407 ) (30,794 ) (106,158 ) (97,672 )
Restructuring expense (3,441 ) (3,441 )
Asset impairments 58 (403,536 ) (22,956 ) (549,942 )
Loss on disposal of assets 2,478   (3,056 ) (1,943 ) (10,934 )
Operating income (loss)5,900(394,053)16,378(509,905)
Interest on long-term debt (39,782 ) (29,996 ) (117,636 ) (99,583 )
Foreign exchange loss (11,573 ) (18,464 ) (24,476 ) (26,835 )
Other financing income charges (5,730 ) (12,014 ) (1,615 ) (14,151 )
Loss before income tax(51,185)(454,527)(127,349)(650,474)
Income tax expense (6,689 ) (10,189 ) (17,489 ) (25,301 )
Net loss$(57,874)$(464,716)$(144,838)$(675,775)
Net earnings (loss) attributable to:
Controlling interest $ (60,003 ) $ (471,482 ) $ (149,324 ) $ (697,164 )
Non-controlling interests 2,129   6,766   $ 4,486   $ 21,389  
Net loss$(57,874)$(464,716)$(144,838)$(675,775)

EBITDAR excluding special items – Non-GAAP Reconciliation

(Expressed in thousands of United States dollars)

(Unaudited)

   
Three months ended Nine months ended
January 31, 2014   January 31, 2015 January 31, 2014   January 31, 2015
Adjusted EBITDAR $ 94,987 $ 113,297 $ 314,096 $ 346,425
Corporate transaction costs1 23,769   1,590   25,081   5,114
Adjusted EBITDAR excluding special items$118,756  $114,887  $339,177  $351,539

Adjusted Net Loss – Non-GAAP Reconciliation

(Expressed in thousands of United States dollars)

(Unaudited)

   
Three months ended Nine months ended
January 31, 2014   January 31, 2015 January 31, 2014   January 31, 2015
Net loss attributable to controlling interest $ (60,003 ) $ (471,482 ) $ (149,324 ) $ (697,164 )
Corporate transaction costs1 23,769 1,590 25,081 5,114
Restructuring expense2 3,441 3,441
Asset impairments (58 ) 403,536 22,956 549,942
Loss on disposal of assets (2,478 ) 3,056 1,943 10,934
Foreign exchange loss 11,573 18,464 24,476 26,835
Net loss on debt extinguishment3 9,990 17,434
Unrealized loss (gain) on derivatives 2,109   1,609   (8,231 ) (8,072 )
Adjusted net loss$(25,088)$(29,796)$(83,099)$(91,536)
Redeemable convertible preferred share dividends   (10,883 )   (10,910 )
Adjusted net loss available to common stockholders4$(25,088)$(40,679)$(83,099)$(102,446)
(1)   Corporate transaction costs include costs related to senior executive turnover, expenses related to the initial public offering, including costs related to restructuring our compensation plan, potential financing and other transactions.
(2) Restructuring expense relates to severance and other costs incurred as part of a review of our operations and organizational structure.
(3) Net loss on debt extinguishment relates to the redemption and purchase on the open market of our senior secured and senior unsecured notes.
(4) Adjusted net loss available to common stockholders includes redeemable convertible preferred share dividends but excludes the adjustments of $12.2 million and $(19.0) million to our redeemable non-controlling interest to redemption amount, which were recognized in additional paid-in capital in the three and nine months ended January 31, 2015 respectively.

Reconciliation of Adjusted EBITDAR excluding special items to Adjusted Net Loss

(Expressed in thousands of United States dollars, except share and per share amounts)

(Unaudited)

   
Three months ended Nine months ended
January 31, 2014   January 31, 2015 January 31, 2014   January 31, 2015
Adjusted EBITDAR excluding special items $ 118,756 $ 114,887 $ 339,177 $ 351,539
Helicopter lease and associated costs (56,216 ) (66,523 ) (166,661 ) (194,341 )
Depreciation (35,407 ) (30,794 ) (106,158 ) (97,672 )
Net loss on debt extinguishment 9,990 17,434
Unrealized loss (gain) on derivatives 2,109 1,609 (8,231 ) (8,072 )
Interest on long-term debt (39,782 ) (29,996 ) (117,636 ) (99,583 )
Other financing charges (5,730 ) (12,014 ) (1,615 ) (14,151 )
Income tax expense (6,689 ) (10,189 ) (17,489 ) (25,301 )
Earnings attributable to non-controlling interests (2,129 ) (6,766 ) (4,486 ) (21,389 )
Adjusted net loss$(25,088)$(29,796)$(83,099)$(91,536)
Adjusted share count 77,519,484 80,639,313 77,519,484 80,589,721

Reconciliation of Adjusted Net Debt

(Expressed in millions of United States dollars)

(Unaudited)

   
October 31, 2014 January 31, 2015
Long term debt $ 1,373 $ 1,236
Current portion of long term debt 109 6
Discount on notes 11 9
Premium on notes (1 ) (1 )
Less: Cash on Balance Sheet (108 ) (217 )
Net Debt $ 1,383   $ 1,033  
NPV of lease commitments1 1,249   1,273  
$2,631  $2,306  
(1)   NPV of lease commitments as of October 31, 2014 and January 31, 2015 discounted at 9%.

Reconciliation of Liquidity

(Expressed in millions of United States dollars)

(Unaudited)

   
April 30, 2014 January 31, 2015
Cash and cash equivalents $ 302.5 $ 217.1
Senior secured revolving credit facility:
Facility credit limit 375.0 375.0
Outstanding letters of credit (54.9 ) (35.6 )
Available senior secured revolving credit facility 320.1 339.4
Available overdraft facilities 28.1   23.6  
$650.7  $580.1  

INVESTORS
Lynn Antipas Tyson
Vice President, Investor Relations
+1 914-485-1150
lynn.tyson@chc.ca
or
MEDIA
T.R. Reid
Vice President, Global Communications
+1 512-869-9094
t.r.reid@chc.ca