Press Releases

Air Methods Reports Second Quarter 2016 Results

Aug 04, 2016

Air Methods Corporation (Nasdaq: AIRM), the global leader in air medical transportation, today reported financial results for the quarter ended June 30, 2016.

Second Quarter 2016 Results:

  • Revenue of $292.6 million, compared to $263.6 million for the second quarter of 2015, an increase of 11.0%.
  • Diluted earnings per share from continued operations of $0.70, compared to $0.69 for the second quarter of 2015, an increase of 1.4%.
  • EBITDA from continuing operations of $76.2 million, compared to $71.2 million for the second quarter of 2015, an increase of 7.0%.
  • The company repurchased 688,210 shares in the second quarter and an additional 718,000 shares in the third quarter through August 3, 2016.

Aaron Todd, CEO of Air Methods, stated, “While we continued to grow the company with 11.0% top line growth in the second quarter, lower than planned air medical transport and tourism passenger volumes resulted in weaker earnings growth. The accelerated training for Tri-State employees is mostly complete, resulting in improved in-service rates and transports in July. Tourism passenger volumes also have recovered in July, declining only 1.6% over the prior year. With these issues now behind us, we are still positioned to achieve our financial targets for the full year.”

Second Quarter Performance by Segment

For the second quarter, Air Medical Services (AMS) revenue increased by 12.6% to $252.9 million compared to $224.7 million in the prior-year quarter. The acquisition of Tri-State Care Flight (TSCF) added $11.2 million in revenues. Excluding TSCF, revenues grew 7.6%. Key operating statistics include:

 

2Q16

2Q15

YOY Change (%)

Transports

18,662

16,105

15.9%

Transports + Weather Cancellations

24,626

22,071

11.6%

Same-Base Transports (SBTs)

15,464

15,397

0.4%

SBT + Weather Cancellations

20,544

21,120

-2.7%

Net Revenue per Transport

$11,516

$11,298

1.9%

 

Flight center and aircraft operations expenses increased 11.1% to $144.2 million in the current quarter compared to $129.8 million in the prior year quarter. TSCF added $8.6 million in flight center and aircraft operations expenses. Excluding TSCF, these expenses increased 4.4% despite revenues growing 7.6% for the corresponding AMS operations. Drivers of the margin expansion include the Company’s investment in its fleet and lower fuel prices. AMS segment net income increased 6.6% to $55.4 million compared to $51.9 million for the second quarter of 2015. On a stand-alone basis, TSCF lost $3.2 million (pre-tax) in the quarter. This does not include the positive contribution from transports retained at consolidated bases.

Tourism revenues decreased 6.4% to $32.2 million in the current quarter compared to $34.4 million in the prior-year quarter.  Total passengers decreased 9.7% to 114,615 during the current quarter compared to 126,953 in the prior-year quarter. Total revenue per passenger increased 3.7% to $281 in the current quarter compared to $271 in the prior-year quarter. Tourism operating expenses decreased 4.1% to $22.1 million in the current quarter compared to $23.1 million in the prior-year quarter. The year-over-year decline was driven primarily by a reduction in maintenance and fuel expense. Tourism segment net income was $2.0 million in the current quarter compared to net income of $3.9 million in the prior-year quarter. 

United Rotorcraft’s external revenue increased 66.4% to $7.4 million in the current quarter compared to $4.4 million in the prior-year quarter. Its segment external earnings improved from a loss of $0.4 million in the year-ago period to a loss of $0.2 million in the current-year quarter.

Share Repurchase Program

During the second quarter and current quarter-to-date through August 3, 2016, the Company repurchased 1.4 million shares for $50.6 million bringing the total number and amount of shares repurchased since the program was initiated to 2.1 million and $77.5 million, respectively. The company presently has $122.5 million remaining on its authorized program.

3Q16 Update

The Company also provided an update on preliminary July 2016 air medical and tourism flight volume. Total community-based transports increased 9.6% to 6,376 during July 2016 compared to 5,816 in July 2015.  July 2016 same-base transports decreased by 354 transports as compared with July 2015. Weather cancellations during July 2016 for these same bases decreased by 6 compared with the prior-year month.

Tourism passengers declined 1.6% to 49,203 during July 2016 compared to 50,015 in July 2015.

Basic and diluted earnings per share from continuing operations for the six-month period ended June 30, 2016 were decreased by $0.02 for an adjustment to the value of equity put options related to both of our redeemable non-controlling interests in consolidated subsidiaries. While net income on the consolidated statement of comprehensive income is not decreased for the valuation adjustment, earnings per share are required to be calculated after decreasing net income for the change in valuation. Basic and diluted earnings per share in the quarters-ended June 30, 2016 and  2015 and six-month period ended June 30, 2015 were not impacted by the adjustment.

Second Quarter 2016 Conference Call

The Company will discuss these results in a conference call scheduled today at 4:30 p.m. Eastern. Interested parties can access the call by dialing (855) 601-0049 (domestic) or (720) 398-0100 (international) or by accessing the web cast at www.airmethods.com. A replay of the call will be available at (855) 859-2056 (domestic) or (404) 537-3406 (international), access number 52621462, for 3 days following the call and the web cast can be accessed at www.airmethods.com for 30 days. Concurrently, the Company will post a financial supplement that contains final operating statistics on its website, www.airmethods.com.

Air Methods Corporation (www.airmethods.com) is the global leader in air medical transportation. The Air Medical Services Division is the largest provider of air medical transport services in the United States. The United Rotorcraft Division specializes in the design and manufacture of aeromedical and aerospace technology. The Tourism Division is comprised of Sundance Helicopters, Inc. and Blue Hawaiian Helicopters, which provide helicopter tours and charter flights in the Las Vegas/Grand Canyon region and Hawaii, respectively. Air Methods’ fleet of owned, leased or maintained aircraft features approximately 500 helicopters and fixed wing aircraft.

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