Logo of jester cap with thought bubble.

Image source: The Motley Fool.

DATE

Wednesday, May 6, 2026 at 10 a.m. ET

CALL PARTICIPANTS

  • President & Chief Executive Officer — Christopher S. Bradshaw
  • Senior Vice President, Chief Financial Officer — Jennifer Dawn Whalen

Need a quote from a Motley Fool analyst? Email [email protected]

TAKEAWAYS

  • Total Revenues -- $11.4 million higher sequentially from Q4 2025, driven mainly by increased activity in Government Services and higher rates in several Offshore Energy Services (OES) markets.
  • Adjusted EBITDA -- $0.9 million lower sequentially, attributed to higher repairs, maintenance, and equipment costs across all segments.
  • 2026 Guidance Affirmation -- Full-year revenue guidance remains at $1.6 billion to $1.7 billion, and adjusted EBITDA guidance remains at $295 million to $325 million.
  • OES Segment Revenues -- Up $6.9 million sequentially from Q4 2025, with growth tied to higher rates and utilization in the U.S. and Trinidad, and higher utilization in Africa; partially offset by lower utilization in Europe.
  • OES Segment Adjusted Operating Income -- Down $0.7 million sequentially, reflecting higher operating expenses of $5.6 million and reduced earnings from unconsolidated affiliates of $1.8 million, offsetting revenue gains.
  • Additional OES Depreciation -- $6.4 million recognized for S-76 helicopters due to retirement and planned fleet transition, with $24 million more expected through early 2027.
  • Government Services Revenues -- Increased $7.8 million sequentially, attributed to the Irish Coast Guard contract transitions and commencement of new base operations in Waterford.
  • Government Services Adjusted Operating Income -- Grew $1.9 million sequentially, driven by higher revenues and partially offset by $4.8 million higher operating expenses due to maintenance, headcount, lease costs, and a $0.5 million rise in professional service fees.
  • Other Services Segment Revenues -- Decreased by $3.2 million sequentially, driven by lower seasonal activity in Australia, partially offset by favorable foreign exchange.
  • Operating Cash Flow -- Net cash used was $8.3 million, primarily resulting from a rise in accounts receivable due to payment timing.
  • Liquidity Position -- Unrestricted cash of $342 million and total available liquidity of approximately $394 million as of March 2026.
  • Senior Secured Notes Refinancing -- Completed a $500 million private offering with a 6.75% coupon, using part of the proceeds to redeem 6.875% senior notes and extending debt maturity.
  • Dividend Action -- Paid $3.7 million in dividends during the period and declared a $0.25 per share dividend payable in late May 2026.
  • Fuel Price Impact -- CEO Bradshaw stated, "fuel is a pass-through in the vast majority of our business. protecting the company from direct fuel price volatility."
  • OES Contract Resets -- Nearly all legacy OES contracts globally are expected to reset by year-end 2026, providing benefit this year and a full-year effect in 2027 and beyond.

SUMMARY

Management reiterated confidence in transformational year prospects, highlighting affirmations of revenue and adjusted EBITDA guidance despite seasonal and operational cost pressures. Bristow Group (VTOL 11.74%) emphasized its positioning to capture growth from increased global defense spending, heightened energy security concerns, and the emergence of advanced air mobility technologies, viewing these as durable multiyear drivers. The company pointed to successful contract transitions, the completion of major refinancing at lower rates and longer maturities, as well as ongoing fleet modernization and expansion of service offerings to government and military customers.

  • CEO Bradshaw said, "The fleet status for offshore-configured heavy and super-medium helicopters remains tight, and the ability to bring in new capacity remains constrained with long manufacturing lead times."
  • Management acknowledged additional $24 million in noncash depreciation will be incurred through early 2027 as it retires S-76 helicopters and transitions fleet models.
  • Christopher S. Bradshaw sees compelling organic and inorganic growth opportunities in serving military, defense, and government aviation needs, especially in Europe and the Americas.
  • The new Norway advanced air mobility project expands the company’s regional mobility test arena to longer routes and increased payload applications involving next-generation aircraft.
  • Operational cash consumption from working capital was milder than in the prior year, and management expects working capital improvements in coming quarters as accounts receivable timing normalizes.

INDUSTRY GLOSSARY

  • OES (Offshore Energy Services): Segment providing aviation and support services to offshore oil and gas producers.
  • CapEx: Capital expenditures for new projects, including exploration and development, which drive future demand for services.
  • OpEx: Ongoing operating expenditures for producing energy assets, closely linked to services revenue.
  • S-76: Sikorsky S-76, a model of medium helicopter being retired from Bristow Group’s active fleet.
  • ISR: Intelligence, surveillance, and reconnaissance missions, an area of government aviation services.

Full Conference Call Transcript

Christopher S. Bradshaw: Thank you, Redeate. The company delivered on our goal of zero air accidents in the first quarter, and the Bristow Group Inc. team remains committed to safety as our number one core value and highest operational priority. Bristow Group Inc.'s first quarter financial results place us on track for what is expected to be a transformational year for the company. We are pleased to affirm our financial guidance ranges for 2026, which notably reflect adjusted EBITDA growth of approximately 25% year over year. While geopolitical conflicts and tensions have driven turbulent and concerning global conditions thus far in 2026, these macro developments underscore the conviction we have in the outlook for Bristow Group Inc.'s business.

I will have more comments on the strong tailwinds poised to benefit the company later in the call, but for now, I will hand it over to our CFO for a detailed discussion of Q1 results and our financial outlook. Jennifer?

Jennifer Dawn Whalen: Thank you, Christopher, and good morning, everyone. Today, I will begin with a review of Bristow Group Inc.'s sequential quarter financial results on a consolidated basis before covering the financial results and 2026 guidance ranges for each of our segments. While the first quarter is typically our seasonally lowest quarter, Bristow Group Inc.'s total revenues were $11.4 million higher compared to Q4 2025, primarily due to increased activity in our Government Services business and increased rates and activity in certain of our key Offshore Energy Services (OES) markets. Adjusted EBITDA was $0.9 million lower in Q1, mainly due to higher repairs and maintenance costs and leased and equipment costs across our segments.

We are affirming our 2026 guidance ranges of $1.6 billion to $1.7 billion for total revenues and $295 million to $325 million for adjusted EBITDA. Turning now to our segment financial results. Revenues in our OES segment were $6.9 million higher in Q1 versus Q4 2025, primarily due to increased rates and higher utilization in the U.S. and Trinidad and higher utilization in Africa, which were partially offset by lower utilization in Europe. Adjusted operating income was $0.7 million lower, primarily due to higher operating expenses of $5.6 million and lower earnings from unconsolidated affiliates of $1.8 million offsetting the higher revenue.

Operating expenses in OES were higher primarily due to lower vendor credits recognized this quarter, coupled with additional aircraft leases, which were partially offset by lower personnel and other operating expenses. During the quarter, the company recognized additional noncash depreciation expense of $6.4 million related to S-76 medium helicopters used in our OES segment as it finalizes plans to retire this model and transition to newer models as part of Bristow Group Inc.'s ongoing fleet management efforts to better meet customer needs. The company plans to complete this transition of models by early 2027 and expects to recognize approximately $24 million of additional depreciation expense through the transition period.

Our 2026 OES revenue guidance range remains between $1.0 billion and $1.1 billion, and our 2026 adjusted operating income guidance range remains $225 million to $235 million for this segment. Moving on to Government Services. Revenues were $7.8 million higher, primarily due to the transition of the Irish Coast Guard contract, including the full quarter impact of the base in Sligo that began operations last quarter and the commencement of operations at the final base in Waterford this quarter.

Adjusted operating income was $1.9 million higher in Q1, primarily due to the higher revenues, partially offset by higher operating expenses of $4.8 million as a result of higher repairs and maintenance, increased headcount in Ireland, higher lease and equipment costs related to the ongoing transition activities in the U.K., and higher general and administrative expenses of $0.5 million largely related to professional service fees. Our 2026 Government Services revenues guidance range remains between $440 million and $460 million, and the adjusted operating income guidance range remains $70 million to $80 million, which is roughly double that of 2025.

Finally, revenues from Other Services were $3.2 million lower in Q1, primarily due to lower seasonal activity in Australia, partially offset by favorable foreign exchange rate impact. Adjusted operating income decreased by $2.9 million due to the lower seasonal revenues, partially offset by reduced operating expenses of $0.4 million related to the lower seasonal activity. Our 2026 revenues and adjusted operating income guidance for this segment remain between $130 million and $150 million and $20 million and $25 million, respectively. Turning now to cash flows and liquidity. Net cash used in operating activities was $8.3 million in the current quarter.

The working capital uses in the current quarter primarily resulted from an increase in accounts receivable largely due to timing of customer payments. In comparison to the prior year, working capital changes consumed more cash flow in Q1 2025 than was the case in Q1 of this year. The company does not have material amounts of aged receivables, so we expect to see improvements in working capital in the coming quarters. As of March 2026, our unrestricted cash balance was $342 million with total available liquidity of approximately $394 million. As a reminder, in January, Bristow Group Inc. closed a private offering of $500 million senior secured notes due in 2033 with a coupon of 6.75%.

The company used a portion of the net proceeds to redeem its existing 6.875% senior notes, with the remaining net proceeds to be used for general corporate purposes. We are very pleased with the successful refinancing transaction highlighted by an upsized deal at a lower coupon rate and extended maturity. Bristow Group Inc.'s financial flexibility, positive financial outlook, and robust balance sheet represent a competitive advantage for the company and favorably position us to pursue various potential growth opportunities. Lastly, Bristow Group Inc. paid $3.7 million in dividends during the quarter, and on April 30, 2026, declared another dividend of $0.25 per share of common stock.

This dividend is payable on May 29, 2026 to shareholders of record at the close of business on May 15, 2026. At this time, I will turn the call back to Christopher for further remarks. Christopher?

Christopher S. Bradshaw: Thank you. Looking forward, we believe Bristow Group Inc. is favorably positioned to benefit from three global megatrends: increased defense spending, the importance of energy security, and the electrification of transportation. Taking each of these in turn, number one, increased defense spending. Given recent hostilities and the overall geopolitical landscape, we expect defense spending to increase significantly over a multiyear period. With the expected scale of these defense expenditures and the continued budgetary pressures for most countries in the Western world, we anticipate the need for increased public-private partnerships to realize these government and military objectives.

We see additional growth opportunities in our core government search and rescue business as well as a broader spectrum of aviation services to government and military customers, particularly in Europe and the Americas. In the context of a complicated geopolitical landscape and expectations for higher defense spending, we believe there will be compelling organic and inorganic growth opportunities for a specialized aviation services provider with Bristow Group Inc.'s track record, operational expertise, and financial flexibility. Number two, importance of energy security. While oil and gas remain commodities, recent geopolitical events have placed an enduring emphasis on where hydrocarbon supplies are located.

In the established offshore energy basins that Bristow Group Inc. services, these represent some of the most attractive and secure sources of supply. Deepwater projects are favorably positioned, offering attractive relative returns within the asset portfolios of oil and gas companies, and we believe offshore projects will receive an increasing share of future upstream capital investment. This positive demand outlook is paired with a tight supply dynamic. The fleet status for offshore-configured heavy and super-medium helicopters remains tight, and the ability to bring in new capacity remains constrained with long manufacturing lead times. This constructive supply-demand balance, combined with an increased prioritization of energy security, supports a positive outlook for the offshore helicopter sector. Number three, the electrification of transportation.

We have continued to advance Bristow Group Inc.'s position as an early leader in the development of the advanced air mobility industry, which will incorporate the operation of next-generation aircraft powered by electric, hybrid-electric, and other new propulsion technologies. As a leader in vertical flight solutions over seventy-five years, Bristow Group Inc. has a unique opportunity to leverage our core competencies as an advanced, proven operator to serve the needs of this new industry sector. We believe the company has created significant option value with minimal capital commitment to date in what is expected to be a large and rapidly growing addressable market for these new-generation aircraft.

In conclusion, we have a very positive outlook for Bristow Group Inc.'s business in 2026 and beyond as we continue the company's evolution as a scaled, multi-mission aviation services provider with complementary business lines. We will now open the call for questions.

Operator: At this time, I would like to remind everyone, in order to ask a question, press star then the number 5 on your telephone keypad. If you would like to withdraw your question, press star and the number 5 once again. We will pause for just a moment and compile the Q&A roster. Our first question comes from Savanthi Syth from Raymond James. Your line is now open.

Savanthi Syth: Hey, good morning. First question was on fuel prices, especially the jet fuel price and availability. Is that affecting your business either directly or indirectly, and what are your expectations as you go through the year?

Christopher S. Bradshaw: Good morning, and thanks for the question. There is a lot of attention, rightfully so, around the aviation jet fuel market globally. Fortunately, Bristow Group Inc. is naturally hedged, as fuel is a pass-through in the vast majority of our business. For example, in all of our OES contracts, there is a pass-through of fuel cost to the end customer. There is one of our government contracts that has a slight lag in the reset, but that is more of a timing issue. So again, we are naturally protected through our pass-through mechanisms. The one area of the business which is a bit different is the commercial airline that we own and operate in northern Australia.

There, our recovery mechanisms are more around increasing rates and imposing, as we recently have, a fuel levy on ticket sales. In terms of supply of aviation fuel, thankfully, we have had ample supply to date, and our suppliers assure us that we should continue to do so. That is obviously something we will continue to monitor, and in a scenario where there may be some rationing, we think as a provider of critical transportation services and search and rescue services that we should receive priority. But again, availability has not been an issue to date, and we are naturally hedged and protected through the pass-through mechanisms in our customer contracts.

Operator: Our next question comes from Joshua Ward Sullivan from JonesTrading. Your line is now open.

Joshua Ward Sullivan: Hey, good morning. As we think about trends in global defense spending you are highlighting as an opportunity for Bristow Group Inc., historically we have primarily known you as a civilian search and rescue operator. As we think about Bristow Group Inc. fitting into the broader defense spending cycle, can you highlight where and how that conversation is going to evolve? And then on the new international sandbox project in Norway with Electro.Aero, how does that differ from the previous one with Dufour? Is it a continuation with just a different aircraft, or are you thinking new insights and different use cases?

Finally, on operating expenses and working capital dynamics in the first quarter or even first half, what are the bigger tent poles that will keep us on track with guidance in the second half?

Christopher S. Bradshaw: We believe there are multiple avenues of potential benefit for us. First, in our core civilian Coast Guard search and rescue services, where we are the market leader. What we are seeing in a lot of conversations, particularly out of Europe right now, is as those countries have committed to increase their defense spending, usually tied to percentages of GDP, they are looking for ways to balance their overall budgets. One of the ways they could potentially do that is, after spending more money on tanks and missiles, to outsource some of the civilian services like the Coast Guard.

We are having conversations with more countries, again particularly in Europe, about potentially outsourcing their civilian services, which could be a source of growth for our core search and rescue business. In addition to that, we already provide other aviation services to militaries and government customers, such as troop movements and ISR, or intelligence, surveillance, and reconnaissance missions. We think those mission profiles will be an additional source of growth for Bristow Group Inc. as we look to expand our capabilities and expand our customer base by providing that broader spectrum of services. Regarding the new international sandbox project in Norway, we would characterize it as an evolution. It is a different aircraft that we are using this time.

In the first test arena, there was a focus primarily on shorter routes around cargo logistics. In the new test arena, we are looking at broader regional air mobility applications, which could include both cargo and passenger transportation along longer routes, so more regional mobility with a different range and payload capability. Again, we would characterize it as an evolution of the exploration of this new market for these next-generation aircraft.

Jennifer Dawn Whalen: To the question on operating expenses and working capital, this quarter the draw on working capital was related to timing of customer payments, which was similar to 2025. Those have since been almost completely collected. On working capital trends, it should potentially look similar to last year. As for the cadence versus guidance, we provide an annual guidance number. Our Q4 and Q1 are typically lower quarters than Q2 and Q3, and we expect that seasonal trend to continue in 2026.

Operator: We will go back to Savanthi Syth from Raymond James. Your line is now open.

Savanthi Syth: Thank you. On slide 13, could you remind us how global offshore production CapEx and OpEx translate into offshore opportunities? I am guessing there is a lag, but how do those progress through to Bristow Group Inc.’s P&L?

Christopher S. Bradshaw: With reference to slide 13 in the investor presentation, there is an expectation that drilling and exploration activity will pick up in the latter half of this year, and we expect overall offshore spending, both CapEx and OpEx, to remain elevated at increasing levels through the end of this decade. For the two components, OpEx, or operating expenditures, relates to existing established projects, primarily production support, and 85% of the revenues that Bristow Group Inc. generates in our OES business are related to those production activities. That is a direct indicator of spend that goes to services like ours. CapEx is related to new projects, including new exploration and development activities.

Any increases there provide upside to us through that 15% of our OES business. Successful new discoveries on the exploration side lead to next year’s or following years’ operating expenditures as production expands. The fact that both categories are expected to grow meaningfully over the next two years are positive tailwinds for our business.

Savanthi Syth: Is there a general timeline to look for when these plans step up versus when it translates to Bristow Group Inc.’s P&L?

Christopher S. Bradshaw: Project timelines have a spectrum. If it is a tieback to an existing platform, that is typically faster than an entirely new greenfield project. We expect activity to increase in the latter half of this year, and we will see almost an immediate benefit from that. The flow-through into the rest of our business should pick up in 2027 and beyond. For specifics, a subsea well tied back to an existing platform may have roughly a nine-month lead time. An entirely new greenfield project in a new exploration area might be closer to three years between the start of exploration and first production. It is a broad spectrum depending upon the activity.

Operator: Our next question comes from an analyst with Capital. Your line is now open.

Analyst: Thank you, and good morning, and nice quarter. Can you update us on the OES contract resets in the U.S.?

Christopher S. Bradshaw: Good morning, and thanks for the question. Here in the U.S., effective at the beginning of this year, we have reset our largest OES contract in the U.S. Gulf. There are others that will reset over the course of this year. More broadly across our global portfolio, we expect by the end of this calendar year that essentially all of our legacy OES contracts will have reset. We will have the benefit of that this year and, of course, more of a full-year benefit in 2027 and beyond.

Analyst: And can you elaborate on the specific operational and financial considerations that led to the decision to retire the S-76 helicopters earlier than expected?

Jennifer Dawn Whalen: This decision was primarily based on operational considerations, including repairs and maintenance coverage with the OEM and our ability to procure parts and inventory needed to support the fleet. It has a small installed base, and it has been difficult to continue to keep those lines supported. To meet our customers’ needs, we have made the change.

Operator: Our next question comes from Steven Silver from Arx Research. Your line is now open.

Steven Silver: Thanks for taking my question. It is an interesting concept laying out these megatrends that Bristow Group Inc. might be in position to participate in over the coming years. Can you discuss timing of the opportunities and how you are balancing them with the continued tight equipment supply and the ever-changing geopolitical landscape?

Christopher S. Bradshaw: From a timing standpoint, these are already tangible in many ways. For example, there is progress being made on projects in the advanced air mobility initiatives. Energy security is very tangible for everyone right now, and the importance of where your resources and supply are coming from is front and center. Around defense spending and government opportunity, this is also very tangible given headlines and developments globally and the conversations we are having with both existing and potential customers about new ways to support them. We expect traction and momentum to increase in the latter part of this year, and we see this as a multiyear opportunity set—quite durable in terms of opportunities to continue to grow the business.

In the context of the tight supply market, that will always be a challenge in meeting increased demand. Thankfully, we are well positioned as the largest operator in the space with the largest global fleet. That presents both challenges and opportunities to optimize the portfolio—where the assets are and whether they are generating the best return potential. We also have a competitive advantage in our financial flexibility, a differentiator versus competitors. We can bring in aircraft on lease or purchase them when that makes more sense. Being the biggest operator for most of our key OEMs on the vertical aircraft side, we are as well, if not better, positioned than anyone to capitalize on that.

Operator: This concludes our question and answer session. I will now turn the call back over to Christopher S. Bradshaw for closing remarks.

Christopher S. Bradshaw: Thank you, Michael. Thanks, everyone, for your time. I look forward to updating you again next quarter. In the meantime, stay safe and well.

Operator: This concludes today's call. You may now disconnect at any time.