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What: Shares of Bristow Group (NYSE:BRS) hit some turbulence and tumbled down more than 21% by 11:30 a.m. ET on Tuesday. Weak fiscal third-quarter earnings as well as a significant dividend reduction were the primary drivers behind today's decline.

So what: Bristow reported revenue of $395.2 million, which was down 8% year over year. The big drag was revenue from oil and gas clients, which slumped 21.2% year over year due to challenging operating conditions in that industry. This was partially offset by a 301.5% surge in search-and-rescue (SAR) revenue due to the start-up of the company's SAR contract in the U.K.

That contract also helped keep earnings from slumping too badly, with adjusted net income falling just 5% year over year to $23.5 million. Meanwhile, on a per-share basis earnings slipped 4% to $0.67 per share.

That result was within the company's guidance range, which gave it confidence to reaffirm its full-year adjusted earnings guidance of $1.80-$2.40 per share. That said, it did note that its outlook for the next fiscal year remains challenging.

Because of that challenging outlook, Bristow is taking action to protect itself from the deepening downturn in the oil and gas market. With liquidity at a premium right now the company made the tough choice to reduce its quarterly dividend from $0.34 per share to $0.07 per share. It's a change the company felt compelled to make in order to provide it with more financial flexibility during the downturn.

Now what: Bristow's dividend has become the latest casualty of the oil market downturn, with the industry's uncertainty forcing companies to focus on preserving cash. While it's not something investors like, it is the prudent move to make because that flexibility could come in real handy should conditions deteriorate further or a very compelling opportunity arises. That being said, Bristow's fate rides on when oil prices and offshore oil and gas activities improve, the timing of which remains uncertain at the moment. 

Matt DiLallo has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.