Utility-rotorcraft service provider Erickson has emerged from bankruptcy proceedings and appointed Andy Mills as interim CEO. Erickson filed for reorganization in November listing debts of $561 million, largely resulting from its 2013 acquisitions of Evergreen Helicopters and Air Amazonia and government and oil services contracts that either folded or never materialized. As part of the reorganization, Erickson divested itself of Air Amazonia and most of the mixed fleet of helicopters that came with the Evergreen acquisition. It also wiped out $400 million in debt, numerous aircraft leases and leases at “onerous rates,” Mills said. “We were also able to restructure our ownership. Our new owners are a widely diverse group of shareholders and some former bond holders. We've improved our liquidity tremendously.” With the new ownership, Erickson is now classified as a small business and qualifies for small-business set-aside contracts.
He said the company plans to keep its workforce at the current level of 700 employees, trimmed from 870 in the months leading up to the bankruptcy filing. Mills said that employees are about equally distributed between field operations and Erickson's MRO and support divisions. The repositioned Erickson will operate a fleet of 20 S-64 Aircranes, for which it holds the type certificate, and 20 medium helicopters composed of two types: 12 Bell 214STs and eight Airbus 330J Pumas. Before the bankruptcy, the company operated a mixed fleet of 70 helicopters, Mills said. “We're operating 42 aircraft right now,” two of them airplanes. “We build, service and maintain all of the [rotorcraft] we fly. That's unusual for most operators,” he said.
Contracts Under Way
One new Aircrane is currently under construction, an S-64E for the Government of South Korea Forest Service, and Mills hopes to add more new production this year. The South Korean contract is the first new-build Aircrane in eight years, and that helicopter is 35 percent complete with the goal of finishing by year-end. He also intends to build the powerline and firefighting businesses for Erickson's fleet of owned Aircranes. He said the powerline business has grown “substantially” over the last few years.
Under a 2015 agreement with Bell, Erickson is a certified maintenance center for 214Bs and 214STs and holds FAA parts manufacturing approval (PMA) for 214 parts with approved design data received from Bell. The Pumas are used mainly for U.S. Navy ship VertRep (vertical replenishment) contracts. Erickson is refurbishing Navy Sikorsky MH-53Es under subcontract. Its MRO division provides contract machining for Bell and Sikorsky. “We have some unique machining capabilities that we've developed over the years to support the Aircrane and now we are using those to support outside customers,” Mills said. He added that, with the divestment of Air Amazonia, Erickson's energy-related business accounts for less than 10 percent of its portfolio. “Our main oil-and-gas revenue now comes from doing heli-portable rig moves with the Aircrane,” he said.
Mills sees the potential to expand not only Erickson's signature Aircrane business, but also its MRO and government service businesses. “We need all three segments as a company now. We see some good growth opportunities coming, particularly in MRO. We've managed to keep our core business intact and we are bullish on our future.”