0001525221-13-000097.txt : 20131113 0001525221-13-000097.hdr.sgml : 20131113 20131112193116 ACCESSION NUMBER: 0001525221-13-000097 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 11 CONFORMED PERIOD OF REPORT: 20130930 FILED AS OF DATE: 20131113 DATE AS OF CHANGE: 20131112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ERA GROUP INC. CENTRAL INDEX KEY: 0001525221 STANDARD INDUSTRIAL CLASSIFICATION: AIR TRANSPORTATION, NONSCHEDULED [4522] IRS NUMBER: 721455213 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-35701 FILM NUMBER: 131211963 BUSINESS ADDRESS: STREET 1: 818 TOWN & COUNTRY BLVD., SUITE 200 CITY: HOUSTON STATE: TX ZIP: 77024 BUSINESS PHONE: 281-606-4900 MAIL ADDRESS: STREET 1: 818 TOWN & COUNTRY BLVD., SUITE 200 CITY: HOUSTON STATE: TX ZIP: 77024 FORMER COMPANY: FORMER CONFORMED NAME: Era Froup Inc. DATE OF NAME CHANGE: 20110708 10-Q 1 era-9302013x10q.htm 10-Q ERA-9.30.2013-10Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
 ________________________________________
FORM 10-Q
________________________________________ 
(Mark One)
ý
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2013              or             
¨
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission file number 1-35701
Era Group Inc.
(Exact Name of Registrant as Specified in Its Charter)
________________________________________ 
Delaware
 
72-1455213
(State or Other Jurisdiction of
Incorporation or Organization)
 
(IRS Employer
Identification No.)
 
 
818 Town & Country Blvd., Suite 200
 
 
Houston, Texas
 
77024
(Address of Principal Executive Offices)
 
(Zip Code)
281-606-4900
(Registrant’s Telephone Number, Including Area Code)

________________________________________ 
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ý    No  ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  ý     No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer  ¨
 
Accelerated filer  ¨
 
Non-accelerated filer  x
(Do not check if a smaller
reporting company)
 
Smaller reporting company  ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ¨    No  ý
The total number of shares of common stock, par value $0.01 per share, outstanding as of October 31, 2013 was 20,189,222. The Registrant has no other class of common stock outstanding.



ERA GROUP INC.
Table of Contents
 
Part I.
 
 
 
 
Item 1.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Item 2.
 
 
 
 
Item 3.
 
 
 
 
Item 4.
 
 
 
Part II.
 
 
 
 
Item 1A.
 
 
 
 
 
Item 6.


1


PART I—FINANCIAL INFORMATION

ITEM 1.
FINANCIAL STATEMENTS
ERA GROUP INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
 
September 30,
2013
 
December 31,
2012
 
(Unaudited)
 
 
ASSETS
 
 
 
Current Assets:
 
 
 
Cash and cash equivalents
$
22,517

 
$
11,505

Receivables:
 
 
 
Trade, net of allowance for doubtful accounts of $3,010 and $2,668 in 2013 and 2012, respectively
48,152

 
48,527

Other
3,244

 
4,713

Inventories, net
26,692

 
26,650

Deferred income taxes
3,642

 
3,642

Prepaid expenses and other
1,278

 
1,803

Escrow deposits
9,900

 

Total current assets
115,425

 
96,840

Property and Equipment
1,014,907

 
1,030,276

Accumulated depreciation
(255,299
)
 
(242,471
)
Net property and equipment
759,608

 
787,805

Investments, at Equity, and Advances to 50% or Less Owned Companies
36,113

 
34,696

Goodwill
352

 
352

Other Assets
16,071

 
17,871

Total Assets
$
927,569

 
$
937,564

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current Liabilities:
 
 
 
Accounts payable and accrued expenses
$
16,796

 
$
15,703

Accrued wages and benefits
8,937

 
4,576

Accrued interest
4,625

 
1,401

Current portion of long-term debt
2,787

 
2,787

Other current liabilities
6,894

 
5,232

Total current liabilities
40,039

 
29,699

Long-Term Debt
240,029

 
276,948

Deferred Income Taxes
208,483

 
203,536

Deferred Gains and Other Liabilities
5,343

 
7,864

Total liabilities
493,894

 
518,047

Series A Preferred Stock, at redemption value; $0.01 par value, 10,000,000 shares authorized; none issued and outstanding in 2013; 1,400,000 shares issued and outstanding in 2012

 
144,232

Equity:
 
 
 
Era Group Inc. stockholders’ equity:
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,189,522 outstanding in 2013 (exclusive of 3,673 treasury shares); none issued and outstanding in 2012
202

 

Class B common stock, $0.01 par value, 60,000,000 shares authorized; none issued and outstanding in 2013; 24,500,000 issued and outstanding in 2012

 
245

Additional paid-in capital
420,650

 
278,838

Retained earnings (accumulated deficit)
12,928

 
(4,025
)
Treasury shares, at cost (3,673 and nil in 2013 and 2012, respectively)
(94
)
 

Accumulated other comprehensive income, net of tax
108

 
20

 
433,794

 
275,078

Noncontrolling interest in subsidiary
(119
)
 
207

Total equity
433,675

 
275,285

Total Liabilities and Stockholders’ Equity
$
927,569

 
$
937,564





The accompanying notes are an integral part of these condensed consolidated financial statements.

2


ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share amounts)
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2013
 
2012
 
2013
 
2012
 
 
 
 
 
 
Operating Revenues
$
80,997

 
$
77,989

 
$
222,961

 
$
202,026

Costs and Expenses:
 
 
 
 
 
 
 
Operating
51,338

 
46,235

 
141,399

 
124,913

Administrative and general
9,683

 
10,338

 
28,362

 
27,210

Depreciation
11,340

 
10,937

 
34,432

 
31,031

 
72,361

 
67,510

 
204,193

 
183,154

Gains on Asset Dispositions, Net
2,560

 
613

 
17,837

 
3,455

Operating Income
11,196

 
11,092

 
36,605

 
22,327

Other Income (Expense):
 
 
 
 
 
 
 
Interest income
155

 
184

 
452

 
765

Interest expense
(4,394
)
 
(2,543
)
 
(13,739
)
 
(6,891
)
SEACOR management fees

 
(500
)
 
(168
)
 
(1,500
)
Derivative losses, net
(96
)
 
(188
)
 
(78
)
 
(492
)
Foreign currency gains (losses), net
409

 
(272
)
 
465

 
633

Other, net
7

 

 
19

 
30

 
(3,919
)
 
(3,319
)
 
(13,049
)
 
(7,455
)
Income Before Income Tax Expense and Equity in Earnings (Losses) of 50% or Less Owned Companies
7,277

 
7,773

 
23,556

 
14,872

Income Tax Expense
2,715

 
2,792

 
8,691

 
5,212

Income Before Equity in Earnings (Losses) of 50% or Less Owned Companies
4,562

 
4,981

 
14,865

 
9,660

Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
526

 
219

 
1,762

 
(5,444
)
Net Income
5,088

 
5,200

 
16,627

 
4,216

Net Loss Attributable to Noncontrolling Interest in Subsidiary
116

 

 
326

 

Net Income Attributable to Era Group Inc.
5,204

 
5,200

 
16,953

 
4,216

Accretion of Redemption Value on Series A Preferred Stock

 
2,099

 
721

 
6,334

Net Income (Loss) Attributable to Common Shares
$
5,204

 
$
3,101

 
$
16,232

 
$
(2,118
)
 
 
 
 
 
 
 
 
Earnings (Loss) Per Common Share:
 
 
 
 
 
 
 
Basic
$
0.26

 
$
0.13

 
$
0.79

 
$
(0.09
)
Diluted
$
0.25

 
$
0.13

 
$
0.79

 
$
(0.09
)
 
 
 
 
 
 
 
 
Weighted Average Common Shares Outstanding:
 
 
 
 
 
 
 
Basic
20,186,013

 
24,500,000

 
20,588,791

 
24,500,000

Diluted
20,505,932

 
24,500,000

 
20,588,791

 
24,500,000







The accompanying notes are an integral part of these condensed consolidated financial statements.

3


ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited, in thousands)
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2013
 
2012
 
2013
 
2012
 
 
 
 
 
 
 
Net Income
 
$
5,088

 
$
5,200

 
$
16,627

 
$
4,216

Other Comprehensive Income:
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 
234

 
112

 
135

 
798

Income tax expense
 
(82
)
 
(39
)
 
(47
)
 
(279
)
 
 
152

 
73

 
88

 
519

Comprehensive Income
 
5,240

 
5,273

 
16,715

 
4,735

Comprehensive Loss Attributable to Noncontrolling Interest in Subsidiary
 
116

 

 
326

 

Comprehensive Income Attributable to Era Group Inc.
 
$
5,356

 
$
5,273

 
$
17,041

 
$
4,735






















The accompanying notes are an integral part of these condensed consolidated financial statements.

4


ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(unaudited, in thousands)
 
 
 
 
 
Era Group Inc. Stockholders’ Equity
 
Non-
controlling
Interest In
Subsidiary
 
Total
Equity
 
 
Series A Convertible Preferred Stock
 
 
Class B Common
Stock
 
Common
Stock
 
Additional
Paid-In
Capital
 
Retained Earnings (Accumulated Deficit)
 
Shares
Held In
Treasury
 
Accumulated
Other
Comprehensive
Income
 
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:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Restricted stock grants
 

 
 

 
3

 
(3
)
 

 

 

 

 

Proceeds and tax benefits from share award plans
 

 
 

 

 
527

 

 

 

 

 
527

Share award amortization
 

 
 

 

 
885

 

 

 

 

 
885

Stock option amortization
 

 
 

 

 
260

 

 
 
 

 

 
260

Employee Stock Purchase Plan amortization
 

 
 

 

 
25

 

 

 

 

 
25

Cancellation of restricted stock
 

 
 

 

 
87

 

 
(94
)
 

 

 
(7
)
Net income (loss)
 

 
 

 

 

 
16,953

 

 

 
(326
)
 
16,627

Currency translation adjustments, net of tax
 

 
 

 

 

 

 

 
88

 

 
88

September 30, 2013
 
$

 
 
$

 
$
202

 
$
420,650

 
$
12,928

 
$
(94
)
 
$
108

 
$
(119
)
 
$
433,675















The accompanying notes are an integral part of these condensed consolidated financial statements.

5


ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
 
Nine Months Ended 
 September 30,
 
2013
 
2012
 
 
Net Cash Provided by (Used in) Operating Activities
$
48,399

 
$
(7,091
)
Cash Flows from Investing Activities:
 
 
 
Purchases of property and equipment
(48,223
)
 
(91,155
)
Proceeds from disposition of property and equipment
59,976

 
4,887

Cash settlements on derivative transactions, net

 
(307
)
Investments in and advances to 50% or less owned companies

 
(11,857
)
Principal payments on notes due from equity investees
856

 
2,725

Principal payments on third party notes receivable, net
592

 
832

Escrow deposits, net
(9,900
)
 

Net cash provided by (used in) investing activities
3,301

 
(94,875
)
Cash Flows from Financing Activities:
 
 
 
Issuance of Series B preferred stock

 
100,000

Payments on long-term debt
(52,091
)
 
(102,090
)
Proceeds from issuance of long-term debt
15,000

 
38,000

Dividends paid on Series A preferred stock
(4,953
)
 
(4,447
)
Proceeds and tax benefits from share award plans
527

 

Proceeds from SEACOR on the settlement of stock options
706

 

Net cash (used in) provided by financing activities
(40,811
)
 
31,463

Effects of Exchange Rate Changes on Cash and Cash Equivalents
123

 
613

Net Increase (Decrease) in Cash and Cash Equivalents
11,012

 
(69,890
)
Cash and Cash Equivalents, Beginning of Period
11,505

 
79,122

Cash and Cash Equivalents, End of Period
$
22,517


$
9,232

Supplemental Cash Flow Information:
 
 
 
Cash paid during the period for:
 
 
 
Interest, net of amounts capitalized
$
9,923

 
$
6,269

Income taxes
$
52

 
$
43




















The accompanying notes are an integral part of these condensed consolidated financial statements.

6


ERA GROUP INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
 
1.
BASIS OF PRESENTATION AND ACCOUNTING POLICY
The condensed consolidated financial statements include the accounts of Era Group Inc. and its consolidated subsidiaries (collectively referred to as the “Company”). The condensed consolidated financial information for the three and nine months ended September 30, 2013 and 2012 has been prepared by the Company and has not been audited by its independent registered public accounting firm. In the opinion of management, all adjustments (consisting of normal recurring adjustments) have been made to fairly present the Company’s financial position as of September 30, 2013, its results of operations for the three and nine months ended September 30, 2013 and 2012, its comprehensive income for the three and nine months ended September 30, 2013 and 2012, its changes in equity for the nine months ended September 30, 2013, and its cash flows for the nine months ended September 30, 2013 and 2012. Results of operations for the interim periods presented are not necessarily indicative of operating results for the full year or any future periods.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the U.S. have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.
Unless the context otherwise indicates, any reference in this Quarterly Report on Form 10-Q to the “Company” refers to Era Group Inc. and its consolidated subsidiaries and any reference in this Quarterly Report on Form 10-Q to “Era Group” refers to Era Group Inc.
Prior to January 31, 2013, the Company was wholly owned by SEACOR Holdings Inc. (along with its other majority-owned subsidiaries being collectively referred to as “SEACOR”) and represented SEACOR’s aviation services business segment. On January 31, 2013, SEACOR recapitalized the Company through the exchange of all of its Class B common stock and $140.0 million of its Series A preferred stock for 19,883,583 shares of newly-issued Era Group common stock, par value $0.01 per share (the “Recapitalization”).  Following the Recapitalization, the Company had only one class of common stock issued and outstanding and no preferred stock outstanding. On January 31, 2013, SEACOR then completed a spin-off by means of a dividend to SEACOR’s stockholders of all of the Company’s issued and outstanding common stock (the “Spin-off”). The Company filed a Registration Statement on Form 10 with the Securities and Exchange Commission (SEC) that was declared effective on January 15, 2013. Prior to the Spin-off, SEACOR and the Company entered into a distribution agreement and several other agreements that govern their post-Spin-off relationship. Era Group is now an independent company with its common stock listed on the New York Stock Exchange under the symbol “ERA.”     
In connection with the Spin-off, the Company entered into an Amended and Restated Transition Services Agreement with SEACOR. Under the terms of the Amended and Restated Transition Services Agreement, SEACOR continues to provide the Company with certain support services, for up to two years from the effective date of the Spin-off, including payroll processing, information systems support, cash disbursement support, cash receipt processing and treasury management.
Revenue Recognition. The Company recognizes revenue when it is realized or realizable and earned. Revenue is realized or realizable and earned when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price to the buyer is fixed or determinable, and collectability is reasonably assured. Revenue that does not meet these criteria is deferred until the criteria are met. Deferred revenues and related activity were as follows (in thousands): 
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2013
 
2012
 
2013
 
2012
Balance at beginning of period
$
15,620

 
$
9,305

 
$
8,953

 
$
123

Revenues deferred during the period
9,362

 
8,017

 
27,571

 
18,921

Revenues recognized during the period
(4,713
)
 
(6,198
)
 
(16,255
)
 
(7,920
)
Balance at end of period
$
20,269

 
$
11,124

 
$
20,269

 
$
11,124

As of September 30, 2013, deferred revenues included $16.9 million related to contract-lease revenues for certain helicopters leased by the Company to Aeróleo Taxi Aero S/A (“Aeróleo”), its Brazilian joint venture. The deferral originated from difficulties experienced by Aeróleo following Petróleo Brasileiro S.A.’s (“Petrobras Brazil”) cancellation of certain contract awards for a number of AW139 medium helicopters under contract-lease from the Company, and the deferral continues as a result of financial difficulties at Aeróleo. The Company will recognize revenues as cash is received or earlier should future collectability become reasonably assured. All costs and expenses related to these contract-leases were recognized as incurred.

7


As of September 30, 2013, deferred revenues also included $3.4 million related to contract-lease revenues for certain helicopters leased by the Company to a customer in India. The deferral resulted from the customer having its operating certificate revoked for a period of time and therefore being unable to operate. The certificate has since been reinstated but uncertainty still remains regarding the collectability of the contract-lease revenues due to the customer’s short-term liquidity issues. The Company will recognize revenues as cash is received or earlier should future collectability become reasonably assured. All costs and expenses related to these contract-leases were recognized as incurred.
Reclassifications. Certain reclassifications of prior period information have been made to conform to the presentation of the current period information. These reclassifications had no effect on net income, equity or the components of cash flow as previously reported.
2.
FAIR VALUE MEASUREMENTS
The fair value of an asset or liability is the price that would be received to sell an asset or transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company utilizes a fair value hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value and defines three levels of inputs that may be used to measure fair value. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, or inputs derived from observable market data. Level 3 inputs are unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities.
The Company’s financial assets and liabilities that are measured at fair value on a recurring basis were as follows (in thousands):
 
Level 1
 
Level 2
 
Level 3
December 31, 2012
 
 
 
 
 
LIABILITIES
 
 
 
 
 
Derivative instruments (included in other current liabilities) (1)
$

 
$
1,025

 
$

 
 
 
 
 
 
September 30, 2013
 
 
 
 
 
ASSETS
 
 
 
 
 
Marketable securities (included in other receivables)
$
83

 
$

 
$

LIABILITIES
 
 
 
 
 
Derivative instruments (included in other current liabilities) (1)

 
712

 

____________________
(1) The fair value of the Company’s derivative instruments was estimated using market data gathered by a third party financial institution, adjusted for market and credit risks applicable to the Company.

8


The estimated fair values of the Company’s other financial assets and liabilities were as follows (in thousands): 
 
 
 
Estimated Fair Value
 
Carrying
Amount
 
Level 1
 
Level 2
 
Level 3
December 31, 2012
 
 
 
 
 
 
 
ASSETS
 
 
 
 
 
 
 
Cash and cash equivalents
$
11,505

 
$
11,505

 
$

 
$

Notes receivable from other business ventures (included in other
 receivables and other assets)
925

 
925

 

 

LIABILITIES
 
 
 
 
 
 
 
Long-term debt, including current portion
279,735

 

 
283,120

 

 
 
 
 
 
 
 
 
September 30, 2013
 
 
 
 
 
 
 
ASSETS
 
 
 
 
 
 
 
Cash and cash equivalents
$
22,517

 
$
22,517

 
$

 
$

Notes receivable from other business ventures (included in other
  receivables and other assets)
642

 
642

 

 

LIABILITIES
 
 
 
 
 
 
 
Long-term debt, including current portion
242,816

 

 
246,670

 

The carrying values of cash and cash equivalents, accounts receivable, escrow deposits, notes receivable from other business ventures and accounts payable approximate fair value. The fair value of the Company’s long-term debt was estimated using discounted cash flow analysis based on estimated current rates for similar types of arrangements. Considerable judgment was required in developing certain of the estimates of fair value and, accordingly, the estimates presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
3.
DERIVATIVE INSTRUMENTS
In 2011, the Company entered into two interest rate swap agreements maturing in 2014 and 2015 that call for the Company to pay fixed interest rates of 1.67% and 1.83% on an aggregate notional value of $31.8 million and receive a variable interest rate based on LIBOR on these notional values. The general purpose of these interest rate swap agreements is to provide protection against increases in interest rates, which might lead to higher interest costs for the Company. The fair value of these derivative instruments at September 30, 2013 and December 31, 2012 was a liability of $0.7 million and $1.0 million, respectively. The unrealized change in fair market value was gains of $0.1 million and losses of $0.4 million on these derivative instruments for the three months ended September 30, 2013 and 2012, respectively, and gains of $0.3 million and losses of $0.5 million for the nine months ended September 30, 2013 and 2012, respectively.
4.
ESCROW DEPOSITS
In August 2013, the Company entered into agreements for the sale of two S76A++ medium helicopters and a S76C++ medium helicopter for cash proceeds totaling $9.9 million. The sales transactions closed in September 2013 and were each treated as a tax-free like-kind exchange under Section 1031 for tax purposes whereby all of the proceeds are held by a qualified intermediary and thus reflected as an escrow deposit in the consolidated balance sheet. A qualified property has been identified to complete the like-kind exchanges under Section 1031 prior to expiration of the 45-day period subsequent to the closing date.
In February 2013, the Company entered into agreements for the sale of two S76C++ helicopters for cash proceeds totaling $18.0 million. The sales transactions closed in May 2013 and were each treated as a tax-free like-kind exchange under Section 1031 for tax purposes whereby $16.0 million of the proceeds were held by a qualified intermediary and originally reflected as an escrow deposit in the consolidated balance sheet as of June 30, 2013. Qualified properties were not identified to complete the like-kind exchanges under Section 1031 prior to expiration of the 45-day period subsequent to the closing date. As a result, the funds were transferred from the qualified intermediary to the Company and included in the Company’s cash balances, and the sale was treated as a taxable event.
5. EQUIPMENT ACQUISITIONS AND DISPOSITIONS
During the nine months ended September 30, 2013, capital expenditures were $48.2 million and consisted primarily of helicopter acquisitions and deposits on future helicopter deliveries. The Company records helicopter acquisitions in Property and

9


Equipment and places helicopters in service once all completion work has been finalized and the helicopters are ready for use. A summary of changes to our operating helicopter fleet during the nine months ended September 30, 2013 is as follows:
Equipment Additions. During the nine months ended September 30, 2013, the Company placed three medium helicopters in service, one of which was delivered in the prior year.
Equipment Dispositions. Major equipment dispositions for the nine months ended September 30, 2013 were as follows:
Light helicopters — twin engine (1)
 
2

Medium helicopters (2)
 
9

Heavy helicopters
 
1

 
 
12

________________________
(1) Includes two light-twin helicopters that had previously been removed from service.
(2) Does not include the AW139 helicopter to be transferred to the manufacturer for trade-in credit as described below.

During the first quarter of 2013, the Company recognized a $5.4 million gain on the sale of an EC225 heavy helicopter. The helicopter was previously on contract-lease to a customer and was damaged in an incident in May 2012, and it was subsequently sold to that customer in March 2013 for cash proceeds of $24.6 million.
During the first quarter of 2013, the Company recognized $2.1 million in insurance proceeds on a S76A helicopter involved in an incident in March 2013, resulting in a gain of $1.2 million.
During the third quarter of 2013, the Company sold or otherwise disposed of property and equipment for proceeds of $10.2 million and recognized gains of $2.6 million.
During the nine months ended September 30, 2013, the Company sold or otherwise disposed of property and equipment, including the transactions described above, for cash proceeds of $60.0 million and net receivables of $0.2 million, resulting in gains of $17.7 million. In addition, the Company recognized previously deferred gains of $0.1 million.
Subsequent to September 30, 2013, the Company reached an agreement with its insurers related to an AW139 medium helicopter involved in an incident in a prior period. Combined with a trade-in credit from the manufacturer of the AW139 helicopter on an “as is” basis, this will result in a gain of approximately $0.3 million upon transfer of the helicopter title to the manufacturer, which is expected to take place before year-end 2013.

6.
INVESTMENTS, AT EQUITY, AND ADVANCES TO 50% OR LESS OWNED COMPANIES
Combined Condensed Financials. Summarized financial information for Dart Holding Company Ltd., in which the Company has a 50% ownership interest, was as follows (in thousands):
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2013
 
2012
 
2013
 
2012
Operating Revenues
$
9,801

 
$
8,849

 
$
31,450

 
$
33,561

Costs and Expenses:
 
 
 
 
 
 
 
Operating and administrative
7,490

 
7,820

 
23,597

 
25,016

Depreciation
1,301

 
1,321

 
3,883

 
4,030

 
8,791

 
9,141

 
27,480

 
29,046

Operating Income (Loss)
$
1,010

 
$
(292
)
 
$
3,970

 
$
4,515

Net Income (Loss)
$
194

 
$
(254
)
 
$
2,298

 
$
1,215


10


7.
INCOME TAXES
The following table shows the effective income tax rate on continuing operations:
 
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
 
2013
 
2012
 
2013
 
2012
Statutory rate
 
35.0
%
 
35.0
%
 
35.0
%
 
35.0
 %
Non-deductible expenses (1)
 
0.7
%
 
0.4
%
 
0.2
%
 
(0.4
)%
Noncontrolling interest
 
0.6
%
 
%
 
0.5
%
 
 %
State taxes
 
1.0
%
 
0.5
%
 
1.2
%
 
0.5
 %
Effective Tax Rate
 
37.3
%
 
35.9
%
 
36.9
%
 
35.1
 %
____________________
(1) Non-deductible expenses are related primarily to share-based payments.
8.
LONG-TERM DEBT
The Company’s borrowings as of the periods indicated were as follows (in thousands):
 
 
September 30, 2013
 
December 31, 2012
7.750% Senior Notes (excluding unamortized discount of $3.2 million and $3.4 million, respectively)
 
$
200,000

 
$
200,000

Senior Secured Revolving Credit Facility
 
15,000

 
50,000

Promissory Notes
 
31,007

 
33,098

 
 
246,007

 
283,098

Less: Portion due with one year
 
(2,787
)
 
(2,787
)
Less: Debt discount, net
 
(3,191
)
 
(3,363
)
Total Long-Term Debt
 
$
240,029

 
$
276,948

7.750% Senior Notes. On December 7, 2012, the Company issued $200.0 million aggregate principal amount of its 7.750% senior unsecured notes due December 15, 2022 (the “7.750% Senior Notes”) and received net proceeds of $191.9 million. Interest on the 7.750% Senior Notes is payable semi-annually in arrears on June 15 and December 15 of each year.
Senior Secured Revolving Credit Facility. As of September 30, 2013, the Company had $15.0 million of outstanding borrowings under its senior secured revolving credit facility (“Revolving Credit Facility”). As of September 30, 2013, the remaining availability under this facility was $176.3 million, net of issued letters of credit of $8.7 million. During the nine months ended September 30, 2013, the Company had borrowings of $15.0 million and made repayments of $50.0 million.
Promissory Notes. During the nine months ended September 30, 2013, the Company made scheduled payments on other long-term debt of $2.1 million.
9.
COMMITMENTS AND CONTINGENCIES
Fleet
The Company’s unfunded capital commitments as of September 30, 2013 consisted primarily of agreements to purchase helicopters and totaled $239.7 million, of which $28.0 million is payable during the remainder of 2013 with the balance payable through 2017. The Company also had $2.0 million of deposits paid on options not yet exercised. The Company may terminate $177.6 million of its total commitments (inclusive of deposits paid on options not yet exercised) without further liability other than liquidated damages of $12.2 million in the aggregate.
Included in these commitments are orders to purchase ten AW189 heavy helicopters, three AW139 medium helicopters, and five AW169 light twin helicopters. The AW189 helicopters are scheduled to be delivered in 2014 through 2017. Two of the AW139 helicopters are scheduled to be delivered by year-end 2013, and one is scheduled for delivery in mid-2014. Delivery dates for the AW169 helicopters have yet to be determined. In addition, the Company had outstanding options to purchase up to an

11


additional ten AW189 helicopters and five AW139 helicopters. If these options were exercised, the helicopters would be scheduled for delivery beginning in 2014 through 2017.
Subsequent to September 30, 2013, the Company exercised an option to acquire an additional AW139 helicopter, which is scheduled to be delivered in the first quarter of 2014. Upon exercise of this option, the unfunded capital commitment for this AW139 helicopter was $13.8 million.
During the third quarter of 2013, the Company incurred a one-time $2.0 million charge related to the operating leases on certain air medical helicopters.
Matters that Could Impact the Company’s Investments
In July 2011, the Company acquired an interest in Aeróleo which was reflected in the Company’s financial statements as an equity investment. Subsequently, Aeróleo has experienced financial difficulties arising from, among other matters, the following:
in August 2011, Petrobras Brazil canceled its AW139 award with Aeróleo, and, as a result, these helicopters remained idle from August 2011 until late November 2012;
suspension from flight operations of the EC225 helicopters on a global basis from October 2012 until July 2013;
effective April 1, 2013, suspension of and non-payment by Petrobras Brazil of all EC225 helicopter contracts through late September and October 2013; and
financial difficulties experienced by another customer which could impair its ability to pay its receivables owed to Aeróleo.
In March 2012, the Company recorded an impairment charge of $5.9 million, net of tax, on its investment in and advances to Aeróleo resulting in a write-down of the investment to nil in 2012. As of September 30, 2013, the Company had deferred the recognition of $16.9 million of revenues owed by Aeróleo as a result of Aeróleo’s financial difficulties, and Aeróleo’s partners have contributed $9.2 million of shareholder debt to Aeróleo since March 2012 to address Aeróleo’s financial challenges. In addition to these operating and financial difficulties, the Company is currently in a dispute with its partner in Aeróleo with respect to the Company’s contractual shareholder rights in connection with any attempted sale or transfer of the partner’s interests, which is being resolved through arbitration. A continuation of any combination of these operating and financial difficulties or the ongoing dispute with the Company’s partner, taken separately or together, may impede Aeróleo’s ability to pay for equipment leased from the Company, necessitate an infusion of capital from the Company to allow Aeróleo to continue to operate and adversely impact the Company’s results of operations.
Other
In the normal course of its business, the Company becomes involved in various litigation matters including, among other things, claims by third parties for alleged property damages and personal injuries. Management has used estimates in determining the Company’s potential exposure to these matters and has recorded reserves in its financial statements related thereto where appropriate. It is possible that a change in the Company’s estimates of that exposure could occur, but the Company does not expect such changes in estimated costs would have a material effect on the Company’s consolidated financial position, results of operations or cash flows.
10.
SERIES A PREFERRED STOCK
On January 31, 2013, as part of the Recapitalization, SEACOR exchanged its 1,400,000 shares of Series A preferred stock, which represented all of the Company’s Series A preferred stock then outstanding, for shares of newly-issued Era Group common stock. During the first quarter of 2013, the Company paid outstanding accrued dividends of $5.0 million to SEACOR.
11.
EARNINGS (LOSS) PER COMMON SHARE
Basic earnings (loss) per common share of the Company are computed based on the weighted average number of common shares issued and outstanding during the relevant periods. Diluted earnings (loss) per common share of the Company are computed based on the weighted average number of common shares issued and outstanding plus the effect of potentially dilutive securities through the application of the if-converted method and/or treasury method. Dilutive securities for this purpose assumes all common shares have been issued and outstanding during the relevant periods pursuant to the conversion of all outstanding Series A preferred stock, restricted stock grants have vested and common shares have been issued pursuant to the exercise of outstanding stock options.

12


Computations of basic and diluted earnings per common share of the Company were as follows (in thousands, except share data):
 
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
 
2013
 
2012
 
2013
 
2012
Net Income (Loss) Attributable to Common Shares
 
$
5,204

 
$
3,101

 
$
16,232

 
$
(2,118
)
Shares:
 
 
 
 
 
 
 
 
Weighted average number of common shares outstanding—basic
 
20,186,013

 
24,500,000

 
20,588,791

 
24,500,000

Assumed conversion of Series A Preferred Stock (1)
 

 

 

 

Net effect of dilutive stock options and restricted stock awards based on the treasury stock method(2)
 
319,919

 

 

 

Weighted average number of common shares outstanding—diluted
 
20,505,932

 
24,500,000

 
20,588,791

 
24,500,000

 
 
 
 
 
 
 
 
 
Basic Earnings (Loss) per Common Share
 
$
0.26

 
$
0.13

 
$
0.79

 
$
(0.09
)
Diluted Earnings (Loss) per Common Share
 
$
0.25

 
$
0.13

 
$
0.79

 
$
(0.09
)
____________________
(1) Excludes 905,430 for the nine month period ending September 30, 2013, and 7,605,769 and 6,729,167 for the three and nine months ending September 30, 2012, respectively, weighted average common shares for the conversion of Series A preferred stock as the effect of their inclusion would have been antidilutive.
(2) Excludes 232,353 for the nine month period ending September 30, 2013, weighted average common shares for certain share awards as the effect of their inclusion would have been antidilutive. No share awards existed in the respective periods in 2012.
12.
RELATED PARTY TRANSACTIONS
Prior to the Spin-off, as part of a consolidated group, certain costs and expenses of the Company were borne by SEACOR and charged to the Company. These costs and expenses are included in both operating expenses and administrative and general expenses in the accompanying consolidated statements of operations. The Company entered into various agreements with SEACOR in connection with the separation, including an Amended and Restated Transition Services Agreement, Distribution Agreement, Tax Matters Agreement, Employee Matters Agreement and the Series B Preferred Stock Exchange Agreement. These costs are summarized as follows (in thousands):
 
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
 
2013
 
2012
 
2013
 
2012
Payroll costs for SEACOR personnel assigned to the Company and participation in SEACOR employee benefit plans, defined contribution plan and share award plans
 
$

 
$
2,291

 
$
5

 
$
6,129

Shared services allocation for administrative support
 

 
714

 
299

 
1,965

Shared services under the Amended and Restated Transition Services Agreement
 
843

 

 
2,248

 

 
 
$
843

 
$
3,005

 
$
2,552

 
$
8,094

During the first quarter of 2013, the Company also paid outstanding accrued dividends of $5.0 million on the Series A preferred stock to SEACOR.
As of September 30, 2013, the Company recorded a payable due to SEACOR of $0.2 million. As of December 31, 2012, the Company recorded a receivable due from SEACOR of $1.0 million.

13


13.
SHARE-BASED COMPENSATION
Share Incentive Plans. Effective January 14, 2013, the Company adopted the Era Group Inc. 2013 Employee Stock Purchase Plan (“ESPP”) under which the Company may offer up to a maximum of 300,000 shares of Common Stock, $0.01 par value per share, for purchase by eligible employees at a price equal to 85% of the lesser of (i) the fair market value of Common Stock on the first day of the offering period or (ii) the fair market value of Common Stock on the last day of the offering period. Common Stock is made available for purchase under the ESPP for six-month offering periods. The ESPP is intended to comply with Section 423 of the Internal Revenue Code of 1986, as amended (the “Code”), but is not intended to be subject to Section 401(a) of the Code or the Employee Retirement Income Security Act of 1974. The Board of Directors of the Company may amend or terminate the ESPP at any time; however, no increase in the number of shares of Common Stock reserved for issuance under the ESPP may be made without stockholder approval. The ESPP has a term of ten years.
Effective January 14, 2013, the Company adopted the Era Group Inc. 2012 Incentive Plan (“2012 Plan”) under which a maximum of 4,000,000 shares of common stock, par value $0.01 per share, are reserved for issuance. Awards granted under the 2012 Plan may be in the form of stock options, stock appreciation rights, shares of restricted stock, other share-based awards (payable in cash or common stock) or performance awards, or any combination thereof, and may be made to outside directors, employees or consultants. As of September 30, 2013, 3,363,416 shares remained available for grant under the 2012 Plan.
Share Award Transactions. Transactions in connection with the Company’s share-based compensation plans during the nine months ended September 30, 2013 were as follows:
Director stock awards granted
45,510

Restricted stock awards granted
223,800

Restricted stock awards canceled
3,673

Stock option activities:
 
Outstanding as of December 31, 2012

Converted stock options
169,058

Granted
200,000

Exercised
(40,302
)
Forfeited
(1,784
)
Expired

Outstanding as of September 30, 2013
326,972

Total share-based compensation expense, which includes stock options, restricted stock and ESPP purchases, totaled $0.6 million and $1.3 million for the three and nine months ended September 30, 2013, respectively. A portion of the restricted stock awards are performance-based. The Company has assessed the probability of meeting the criteria and has recorded the appropriate expense.
During the nine months ended September 30, 2013, the Company awarded 269,310 shares of restricted stock at an average grant date fair value of $21.24 per share, granted 200,000 stock options and converted 37,900 options to purchase SEACOR common stock held by Company employees and directors prior to the Spin-off into 169,058 options to purchase Era Group common stock. The fair value used for the converted stock options was evaluated before and after the Spin-off and there was no change. The following table shows the assumptions used to compute the share-based compensation expense for stock options granted during the nine months ended September 30, 2013:
Risk free interest rate
 
0.81
%
Expected life (years)
 
5

Volatility
 
50
%
Dividend yield
 
%
Weighted average exercise price of options granted
 
$19.04 per option

Weighted average grant-date fair value of options granted
 
$7.87 per option


14


14.
SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION
On December 7, 2012, the Company issued $200.0 million aggregate principal amount of its 7.750% Senior Notes. The Company’s payment obligations under the 7.750% Senior Notes are jointly and severally guaranteed by all of the Company’s existing wholly-owned U.S. subsidiaries that guarantee the Revolving Credit Facility and its future U.S. subsidiaries that guarantee the Revolving Credit Facility or other material indebtedness the Company may incur in the future (the “Guarantors”). All the Guarantors currently guarantee the Revolving Credit Facility. The guarantees of the Guarantors are full and unconditional.
As a result of the guarantee arrangements, the Company is presenting the following condensed consolidating balance sheets, statements of operations, comprehensive income and cash flows for Era Group Inc. (“Parent Company Only”), for the Guarantors and for our other subsidiaries (“Non-Guarantor Subsidiaries”).

15


Supplemental Condensed Consolidating Balance Sheet as of September 30, 2013
 
 
Parent Company Only
 
Guarantor Subsidiaries
 
Non-Guarantor Subsidiaries
 
Eliminations
 
Consolidated
 
 
(in thousands, except share data)
ASSETS
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
7,890

 
$
13,462

 
$
1,165

 
$

 
$
22,517

Receivables:
 
 
 
 
 
 
 
 
 
 
Trade, net of allowance for doubtful accounts of $3,010
 

 
48,012

 
140

 

 
48,152

Other
 
189

 
3,161

 

 
(106
)
 
3,244

Intercompany receivables
 
543,821

 
11,436

 

 
(555,257
)
 

Inventories, net
 

 
26,692

 

 

 
26,692

Deferred income taxes
 
3,908

 

 

 
(266
)
 
3,642

Prepaid expenses and other
 
23

 
1,255

 

 

 
1,278

Escrow deposits
 

 
9,900

 

 

 
9,900

Total current assets
 
555,831

 
113,918

 
1,305

 
(555,629
)
 
115,425

Property and Equipment
 

 
1,003,407

 
11,500

 

 
1,014,907

Accumulated depreciation
 

 
(253,746
)
 
(1,553
)
 

 
(255,299
)
Net property and equipment
 

 
749,661

 
9,947

 

 
759,608

Investments, at Equity, and Advances to 50% or Less Owned Companies
 

 
36,113

 

 

 
36,113

Investments, at Equity in Consolidated Subsidiaries
 
100,308

 

 

 
(100,308
)
 

Goodwill
 

 
352

 

 

 
352

Other Assets
 
5,657

 
10,414

 

 

 
16,071

Total Assets
 
$
661,796

 
$
910,458

 
$
11,252

 
$
(655,937
)
 
$
927,569

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
 
$
953

 
$
15,795

 
$
48

 
$

 
$
16,796

Accrued wages and benefits
 

 
8,937

 

 

 
8,937

Accrued interest
 
4,607

 
18

 

 

 
4,625

Intercompany payables
 
10,633

 
527,907

 
11,442

 
(549,982
)
 

Current portion of long-term debt
 

 
2,787

 

 

 
2,787

Other current liabilities
 

 
7,000

 

 
(106
)
 
6,894

Total current liabilities
 
16,193

 
562,444

 
11,490

 
(550,088
)
 
40,039

Long-Term Debt
 
211,809

 
28,220

 

 

 
240,029

Deferred Income Taxes
 

 
209,238

 

 
(755
)
 
208,483

Deferred Gains and Other Liabilities
 

 
3,780

 

 
1,563

 
5,343

Total liabilities
 
228,002

 
803,682

 
11,490

 
(549,280
)
 
493,894

 
 
 
 
 
 
 
 
 
 
 
Equity:
 
 
 
 
 
 
 
 
 
 
Era Group Inc. stockholders’ equity:
 
 
 
 
 
 
 
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,189,522 issued and outstanding in 2013 (exclusive of 3,673 treasury shares)
 
202

 

 

 

 
202

Additional paid-in capital
 
420,650

 
99,845

 
496

 
(100,341
)
 
420,650

Retained earnings (accumulated deficit)
 
12,928

 
7,050

 
(734
)
 
(6,316
)
 
12,928

Treasury shares, at cost (3,673 in 2013)
 
(94
)
 

 

 

 
(94
)
Accumulated other comprehensive loss, net of tax
 
108

 

 

 

 
108

 
 
433,794

 
106,895

 
(238
)
 
(106,657
)
 
433,794

Noncontrolling interest in subsidiary
 

 
(119
)
 

 

 
(119
)
Total equity
 
433,794

 
106,776

 
(238
)
 
(106,657
)
 
433,675

Total Liabilities and Stockholders’ Equity
 
$
661,796

 
$
910,458

 
$
11,252

 
$
(655,937
)
 
$
927,569



16


Supplemental Condensed Consolidating Balance Sheet as of December 31, 2012
 
 
Parent Company Only
 
Guarantor Subsidiaries
 
Non-Guarantor Subsidiaries
 
Eliminations
 
Consolidated
 
 
(in thousands, except share data)
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
 
971

 
3,742

 

 

 
4,713

Due from SEACOR and affiliates
 
560,327

 

 

 
(560,327
)
 

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
 

 
1,018,776

 
11,500

 

 
1,030,276

Accumulated depreciation
 

 
(241,436
)
 
(1,035
)
 

 
(242,471
)
Net property and equipment
 

 
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 STOCKHOLDERS’ 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

Series A Preferred Stock, at redemption value; $0.01 par value, 10,000,000 shares authorized; none issued and outstanding in 2013; 1,400,000 shares issued and outstanding in 2012
 
144,232

 

 

 

 
144,232

Equity:
 
 
 
 
 
 
 
 
 
 
Era Group Inc. stockholders’ equity:
 
 
 
 
 
 
 
 
 
 
Class B common stock, $0.01 par value, 60,000,000 shares authorized; 24,500,000 issued and outstanding
 
245

 

 

 

 
245

Additional paid-in capital
 
278,838

 
109,674

 
496

 
(110,170
)
 
278,838

Accumulated deficit
 
(4,025
)
 
(4,217
)
 
(82
)
 
4,299

 
(4,025
)
Accumulated other comprehensive income, 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



17


Supplemental Condensed Consolidating Statement of Operations for the Three Months Ended September 30, 2013
 
 
Parent Company Only
 
Guarantor Subsidiaries
 
Non-Guarantor Subsidiaries
 
Eliminations
 
Consolidated
 
 
(in thousands)
Operating Revenues
 
$

 
$
80,701

 
$
296

 
$

 
$
80,997

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
Operating
 

 
51,142

 
196

 

 
51,338

Administrative and general
 
1,665

 
8,016

 
2

 

 
9,683

Depreciation
 

 
11,167

 
173

 

 
11,340

 
 
1,665

 
70,325

 
371

 

 
72,361

Gains on Asset Dispositions, Net
 

 
2,560

 

 

 
2,560

Operating Income (Loss)
 
(1,665
)
 
12,936

 
(75
)
 

 
11,196

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
Interest income
 
28

 
127

 

 

 
155

Interest expense
 
(4,143
)
 
(251
)
 

 

 
(4,394
)
Intercompany interest
 
8,072

 
(7,916
)
 
(156
)
 

 

Derivative losses, net
 

 
(96
)
 

 

 
(96
)
Foreign currency gains, net
 
1

 
408

 

 

 
409

Other, net
 
7