Table of Contents


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 March 31, 2015              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)
713-369-4700
(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  ý
 
Non-accelerated filer  ¨
(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 April 30, 2015 was 20,582,541. The Registrant has no other class of common stock outstanding.


Table of Contents

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


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PART I—FINANCIAL INFORMATION

ITEM 1.
FINANCIAL STATEMENTS
ERA GROUP INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
 
March 31,
2015
 
December 31,
2014
 
(Unaudited)
 
 
ASSETS
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
33,691

 
$
40,867

Receivables:
 
 
 
Trade, net of allowance for doubtful accounts of $1,926 and $1,955 in 2015 and 2014, respectively
38,949

 
33,390

Other, net of allowance for doubtful accounts of $437 in each of 2015 and 2014
2,567

 
2,062

Inventories, net
26,189

 
26,869

Deferred income taxes
2,167

 
1,996

Prepaid expenses and other
4,081

 
2,661

Escrow deposits
2,800

 

Total current assets
110,444

 
107,845

Property and equipment
1,171,548

 
1,171,267

Accumulated depreciation
(315,399
)
 
(308,141
)
Net property and equipment
856,149

 
863,126

Equity investments and advances
31,397

 
31,753

Goodwill
352

 
352

Other assets
15,156

 
14,098

Total assets
$
1,013,498

 
$
1,017,174

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable and accrued expenses
$
13,904

 
$
15,120

Accrued wages and benefits
6,822

 
7,521

Accrued interest
4,791

 
949

Current portion of long-term debt
26,729

 
27,426

Derivative instruments
275

 
1,109

Accrued income taxes
37

 
267

Other current liabilities
3,121

 
3,162

Total current liabilities
55,679

 
55,554

Long-term debt
277,424

 
282,118

Deferred income taxes
217,200

 
217,027

Other liabilities
1,937

 
2,111

Total liabilities
552,240

 
556,810

Commitments and contingencies (see Note 8)

 

Equity:
 
 
 
Era Group Inc. stockholders’ equity:
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,582,841 and 20,371,672 outstanding in 2015 and 2014, respectively, exclusive of treasury shares
206

 
204

Additional paid-in capital
430,251

 
429,109

Retained earnings
31,755

 
31,797

Treasury shares, at cost, 19,059 and 18,609 shares in 2015 and 2014, respectively
(560
)
 
(551
)
Accumulated other comprehensive income, net of tax
93

 
95

Total Era Group Inc. stockholders’ equity
461,745

 
460,654

Noncontrolling interest in subsidiary
(487
)
 
(290
)
Total equity
461,258

 
460,364

Total liabilities and stockholders’ equity
$
1,013,498

 
$
1,017,174




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

2

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ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share amounts)
 
Three Months Ended March 31,
 
2015
 
2014
Operating revenues
$
67,415

 
$
79,443

Costs and expenses:
 
 
 
Operating
43,605

 
49,640

Administrative and general
9,743

 
11,334

Depreciation
11,602

 
11,287

Total costs and expenses
64,950

 
72,261

Gains on asset dispositions, net
3,388

 
2,891

Operating income
5,853

 
10,073

Other income (expense):
 
 
 
Interest income
251

 
145

Interest expense
(3,545
)
 
(3,753
)
Gain on debt extinguishment
264

 

Derivative losses, net
(12
)
 
(30
)
Foreign currency losses, net
(2,960
)
 
(57
)
Total other income (expense)
(6,002
)
 
(3,695
)
Income (loss) before income taxes and equity earnings
(149
)
 
6,378

Income tax expense (benefit)
(55
)
 
2,503

Income (loss) before equity earnings
(94
)
 
3,875

Equity earnings (losses), net of tax
(145
)
 
499

Net income (loss)
(239
)
 
4,374

Net loss attributable to non-controlling interest in subsidiary
197

 
71

Net income (loss) attributable to Era Group Inc.
$
(42
)
 
$
4,445

 
 
 
 
Earnings (loss) per common share:
 
 
 
Basic
$

 
$
0.22

Diluted
$

 
$
0.22

 
 
 
 
Weighted average common shares outstanding:
 
 
 
Basic
20,195,955

 
19,952,930

Diluted
20,195,955

 
20,025,135
















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

3

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ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited, in thousands)
 
 
Three Months Ended March 31,
 
 
2015
 
2014
Net income (loss)
 
$
(239
)
 
$
4,374

Other comprehensive loss:
 
 
 
 
Foreign currency translation adjustments
 
(3
)
 
(2
)
Income tax benefit
 
1

 
1

Total other comprehensive loss
 
(2
)
 
(1
)
Comprehensive income (loss)
 
(241
)
 
4,373

Comprehensive loss attributable to non-controlling interest in subsidiary
 
197

 
71

Comprehensive income (loss) attributable to Era Group Inc.
 
$
(44
)
 
$
4,444









































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

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ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(unaudited, in thousands)
 
 
Common
Stock
 
Additional
Paid-In
Capital
 
Retained Earnings
 
Treasury
Shares
 
Accumulated
Other
Comprehensive
Income
 
Non-
controlling
Interest In
Subsidiary
 
Total
Equity
December 31, 2014
 
$
204

 
$
429,109

 
$
31,797

 
$
(551
)
 
$
95

 
$
(290
)
 
$
460,364

Issuance of common stock:
 
 
 
 
 
 
 
 
 
 
 
 
 

Restricted stock grants
 
2

 
(2
)
 

 

 

 

 

Employee Stock Purchase Plan
 

 
612

 

 

 

 

 
612

Share award amortization
 

 
496

 

 

 

 

 
496

Stock option amortization
 

 
63

 

 

 

 

 
63

Employee Stock Purchase Plan amortization
 

 
59

 

 

 

 

 
59

Cancellation of restricted stock
 

 
9

 

 
(9
)
 

 

 

Tax deficit from share award plans
 

 
(95
)
 

 

 

 

 
(95
)
Net loss
 

 

 
(42
)
 

 

 
(197
)
 
(239
)
Currency translation adjustments, net of tax
 

 

 

 

 
(2
)
 

 
(2
)
March 31, 2015
 
$
206

 
$
430,251

 
$
31,755

 
$
(560
)
 
$
93

 
$
(487
)
 
$
461,258


































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

5

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ERA GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
 
Three Months Ended 
 March 31,
 
2015
 
2014
Cash flows from operating activities:
 
 
 
Net income (loss)
$
(239
)
 
$
4,374

Adjustments to reconcile net income (loss) to net cash provided by operating activities:
 
 
 
Depreciation
11,602

 
11,287

Amortization of deferred financing costs
258

 
165

Debt discount amortization
65

 
61

Share-based compensation
618

 
2,057

Bad debt expense

 
25

Gains on asset dispositions, net
(3,388
)
 
(2,891
)
Gain on debt extinguishment
(264
)
 

Derivative losses, net
12

 
30

Cash settlements on derivative transactions, net
(93
)
 
(122
)
Foreign currency losses, net
3,265

 
57

Deferred income tax expense (benefit)
(52
)
 
2,308

Equity earnings, net of tax
145

 
(499
)
Changes in operating assets and liabilities:
 
 
 
Increase in receivables
(6,584
)
 
(10,004
)
Increase in prepaid expenses and other assets
(29
)
 
(970
)
Increase in accounts payable, accrued expenses and other liabilities
1,472

 
5,399

Net cash provided by operating activities
6,788

 
11,277

Cash flows from investing activities:
 
 
 
Purchases of property and equipment
(8,866
)
 
(18,751
)
Proceeds from disposition of property and equipment
5,379

 
3,566

Cash settlements on forward contracts, net
(1,103
)
 

Principal payments on notes due from equity investees
169

 
161

Principal payments on third party notes receivable
25

 
36

Escrow deposits, net
(2,800
)
 
(3,048
)
Net cash used in investing activities
(7,196
)
 
(18,036
)
Cash flows from financing activities:
 
 
 
Payments on long-term debt
(15,697
)
 
(697
)
Proceeds from Revolving Credit Facility
20,000

 

Revolving Credit Facility issuance costs

 
(2,115
)
Extinguishment of long-term debt
(9,297
)
 

Proceeds from share award plans
612

 
529

Net cash used in financing activities
(4,382
)
 
(2,283
)
Effects of exchange rate changes on cash and cash equivalents
(2,386
)
 
(3
)
Net decrease in cash and cash equivalents
(7,176
)
 
(9,045
)
Cash and cash equivalents, beginning of period
40,867

 
31,335

Cash and cash equivalents, end of period
$
33,691


$
22,290

Supplemental cash flow information:
 
 
 
Cash paid for interest
$
1,079

 
$
652

Cash paid (refunded) for income taxes
$
5

 
$
(1
)





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

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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 months ended March 31, 2015 and 2014 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 March 31, 2015, its results of operations for the three months ended March 31, 2015 and 2014, its comprehensive income for the three months ended March 31, 2015 and 2014, its changes in equity for the three months ended March 31, 2015, and its cash flows for the three months ended March 31, 2015 and 2014. 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 United States (“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, 2014.
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. without its subsidiaries.
Certain of the Company’s operations are subject to seasonal factors. Operations in the U.S. Gulf of Mexico are often at their highest levels from April to September, as daylight hours increase, and are at their lowest levels from November to February, as daylight hours decrease. The Company’s Alaskan operations also see an increase during May to September, as its firefighting and flightseeing operations occur during this time and daylight hours are significantly longer.
Basis of Consolidation. The consolidated financial statements include the accounts of Era Group Inc., its wholly-owned subsidiaries and entities that meet the criteria of Variable Interest Entities (“VIEs”) of which the Company is the primary beneficiary. All significant inter-company accounts and transactions are eliminated in consolidation. Era do Brazil LLC is a VIE of which the Company is the primary beneficiary. Aeróleo Taxi Aereo S/A (“Aeróleo”) meets the criteria of a VIE; however, the Company is not the primary beneficiary.
Revenue Recognition. The Company recognizes revenues when they are realized or realizable and earned. Revenues are 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. Revenues that do not meet these criteria are deferred until the criteria are met. Deferred revenues, the balance of which is offset in receivables, and related activity during the three months ended March 31, 2015 and 2014, were as follows (in thousands): 
 
Three Months Ended 
 March 31,
 
2015
 
2014
Balance at beginning of period
$
31,047

 
$
24,243

Revenues deferred during the period
7,829

 
8,344

Revenues recognized during the period
(6,210
)
 
(6,118
)
Balance at end of period
$
32,666

 
$
26,469

As of March 31, 2015, deferred revenues of $32.7 million were related to dry-lease revenues for certain helicopters leased by the Company to Aeróleo, its Brazilian joint venture. The deferral originated from difficulties experienced by Aeróleo following Petróleo Brasileiro S.A.’s (“Petrobras Brazil”) cancellation in 2011 of certain contract awards to Aeróleo for a number of AW139 medium helicopters under dry-lease from the Company, and the deferral continues as a result of continued 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 dry-leases were recognized as incurred.
Receivables. Customers are primarily major integrated and independent exploration and production companies, hospitals, international helicopter operators and the U.S. government. Customers are typically granted credit on a short-term basis and related credit risks are considered minimal. The Company routinely reviews its receivables and makes provisions for probable doubtful accounts; however, those provisions are estimates and actual results could differ from those estimates and those differences may

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be material. Receivables are deemed uncollectible and removed from receivables and the allowance for doubtful accounts when collection efforts have been exhausted.
New Accounting Standards. In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 - Revenue From Contracts With Customers, which will base revenue recognition on the contract between a vendor and customer and will require reporting entities to allocate the transaction price to various performance obligations in a contract and recognize revenues when those performance obligations are satisfied. ASU 2014-09 will be effective for annual reporting periods beginning after December 15, 2016 and any interim periods within that period, and early adoption is not permitted. On April 1, 2015, the FASB proposed deferring the effective date by one year to annual reporting periods beginning after December 15, 2017. The FASB also proposed allowing early adoption, but not before the original effective date. The Company is currently evaluating the potential impact and the method of the adoption of ASU 2014-09 on its consolidated financial statements.
In February 2015, the FASB issued ASU 2015-02 - Consolidation, which amends the guidance for evaluating whether certain entities should be consolidated, particularly for general partner and limited partner relationships and VIEs that have fee arrangements or related party relationships with a reporting entity. ASU 2015-02 will be effective for annual reporting periods beginning after December 15, 2015 and any interim periods within that period, and early adoption is permitted. The Company has not adopted ASU 2015-02 and believes adoption will not have a material impact on its consolidated financial statements.
In April 2015, the FASB issued ASU 2015-03 - Interest - Imputation of Interest, which requires debt issuance costs related to a recognized debt liability to be presented on the balance sheet as a direct reduction of the carrying amount of that liability. The recognition and measurement guidance for debt issuance costs is not affected by this ASU. ASU 2015-03 will be effective for annual reporting periods beginning after December 15, 2015 and any interim periods within that period, and early adoption is permitted. The Company has not adopted ASU 2015-03. As of March 31, 2015 and December 31, 2014, the Company had debt issuance costs of $6.4 million and $6.9 million, respectively, which are included in other assets on the condensed consolidated balance sheets. The Company believes the adoption of ASU 2015-03 would reduce other assets and long-term debt by such amounts.
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 as of March 31, 2015 and December 31, 2014 that are measured at fair value on a recurring basis were as follows (in thousands):
 
Level 1
 
Level 2
 
Level 3
March 31, 2015
 
 
 
 
 
LIABILITIES
 
 
 
 
 
Derivative instruments(1)
$

 
$
275

 
$

 
 
 
 
 
 
December 31, 2014
 
 
 
 
 
LIABILITIES
 
 
 
 
 
Derivative instruments(1)
$

 
$
1,109

 
$

____________________
(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.

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The estimated fair values of the Company’s other financial assets and liabilities as of March 31, 2015 and December 31, 2014 were as follows (in thousands): 
 
Carrying
Amount
 
Level 1
 
Level 2
 
Level 3
March 31, 2015
 
 
 
 
 
 
 
LIABILITIES
 
 
 
 
 
 
 
Long-term debt, including current portion
$
304,153

 
$

 
$
300,014

 
$

 
 
 
 
 
 
 
 
December 31, 2014
 
 
 
 
 
 
 
LIABILITIES
 
 
 
 
 
 
 
Long-term debt, including current portion
$
309,544

 
$

 
$
320,099

 
$

The carrying values of cash and cash equivalents, receivables, 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 analyses 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 December 2015 that call for the Company to pay fixed interest rates of 1.29% and 1.76% on an aggregate notional value of $27.1 million, which decreases each month by the amount of principal payments made on the note, 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 as of March 31, 2015 and December 31, 2014 was a liability of $0.2 million and $0.3 million, respectively. The Company recognized gains of $0.1 million and $0.1 million for the three months ended March 31, 2015 and 2014, respectively. These gains are included in derivative losses, net on the condensed consolidated statements of operations.
From time to time, the Company enters into forward exchange option contracts to hedge against foreign currency payment commitments and anticipated transaction exposures. All derivatives are recognized as assets or liabilities and marked to fair value each period. The Company does not use financial instruments for trading or speculative purposes. None of the Company’s derivative instruments contain credit-risk-related contingent features, and counterparties to the derivative contracts are high credit quality financial institutions.
The Company entered into forward contracts during the second quarter of 2014 to mitigate its exposure to exchange rate fluctuations on euro-denominated aircraft purchase commitments. The Company has not designated these contracts as hedges for accounting purposes. The Company recorded a loss of $0.3 million on these derivative instruments during the three months ended March 31, 2015. These losses are recorded in foreign currency losses, net in the condensed consolidated statements of operations.
4.
ESCROW DEPOSITS
From time to time, the Company enters into Qualified Exchange Accommodation Agreements with a third party to meet the like-kind exchange requirements of Section 1031 of the Internal Revenue Code (“IRC”) and the provisions of Revenue Procedure 2000-37. In accordance with these provisions, the Company is permitted to deposit proceeds from the sale of assets into escrow accounts for the purpose of acquiring other assets and qualifying for the temporary deferral of taxable gains realized. Consequently, the Company establishes escrow accounts with financial institutions for the deposit of funds received on sales of equipment, which are designated for replacement property within a specified period of time. As of March 31, 2015, the Company had deposits of $2.8 million in like-kind exchange escrow accounts. There were no such deposits as of December 31, 2014.
In February 2015, the Company sold one H135 light twin helicopter for cash proceeds of $2.8 million, net of fees. The Company intends to treat the sale transaction as a tax-free like-kind exchange for tax purposes under Section 1031 of the IRC whereby proceeds are held by a qualified intermediary until qualified assets are delivered. The Company has identified a qualifying property for the sale and expects to complete the like-kind exchange transaction during the second quarter of 2015.
5.
ACQUISITIONS AND DISPOSITIONS
Capital Expenditures. During the three months ended March 31, 2015, capital expenditures were $8.9 million and consisted primarily of a base expansion project and capitalized interest. During the three months ended March 31, 2015 and 2014,

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the Company capitalized interest of $1.7 million and $1.0 million, respectively. As of March 31, 2015 and December 31, 2014, construction in progress, which is a component of property and equipment, included capitalized interest of $6.7 million and $5.0 million, respectively. A summary of changes to our operating helicopter fleet is as follows:
Equipment Additions - The Company had no helicopter acquisitions during the three months ended March 31, 2015. The Company placed two AW139 helicopters into service during the three months ended March 31, 2014.
Equipment Dispositions - During the three months ended March 31, 2015, the Company sold or otherwise disposed of property and equipment for proceeds of $5.4 million and recognized gains of $2.2 million. Additionally, a leasing customer exercised a purchase option for three helicopters from which the Company recognized a gain of $1.2 million and an investment in sales-type lease of $2.3 million. During the three months ended March 31, 2014, the company sold or otherwise disposed of property and equipment for proceeds of $3.6 million and recognized gains of $2.9 million.
6.
INCOME TAXES
The Company’s effective income tax rates were 36.9% and 39.0% for the three months ended March 31, 2015 and 2014, respectively. The effective tax rate was impacted by a lower state apportionment factor in 2015.
7.
LONG-TERM DEBT
The Company’s borrowings were as follows (in thousands):
 
 
March 31, 2015
 
December 31, 2014
7.750% senior notes (excluding unamortized discount)
 
$
190,100

 
$
200,000

Senior secured revolving credit facility
 
90,000

 
85,000

Promissory notes
 
26,729

 
27,426

 
 
306,829

 
312,426

Less: portion due with one year
 
(26,729
)
 
(27,426
)
Less: debt discount, net
 
(2,676
)
 
(2,882
)
Total long-term debt
 
$
277,424

 
$
282,118

7.750% Senior Notes. On December 7, 2012, Era Group 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. During the three months ended March 31, 2015, the Company repurchased $9.9 million of the 7.750% Senior Notes and recognized a gain on extinguishment of $0.3 million.
Amended and Restated Senior Secured Revolving Credit Facility. On March 31, 2014, Era Group entered into an amended and restated senior secured revolving credit facility (the “Revolving Credit Facility”) that matures in March 2019. The Revolving Credit Facility provides Era Group with the ability to borrow up to $300.0 million, with a sub-limit of up to $50.0 million for letters of credit, and amends and restates the $200.0 million senior secured revolving credit facility (the “Prior Credit Facility”). Subject to the satisfaction of certain conditions precedent and the agreement by the lenders, the Revolving Credit Facility includes an “accordion” feature which, if exercised, will increase total commitments by up to $100.0 million. Era Group’s availability under the Revolving Credit Facility may be limited by the terms of the 7.750% Senior Notes.
Borrowings under the Revolving Credit Facility bear interest at a rate per annum equal to, at Era Group’s election, either a base rate or LIBOR, each as defined, plus an applicable margin. The applicable margin is based on the Company’s ratio of funded debt to EBITDA, as defined, and ranges from 75 to 200 basis points on the base rate margin and 175 to 300 basis points on the LIBOR margin. The applicable margin as of March 31, 2015 was 125 basis points on the “base rate” margin and 225 basis points on the LIBOR margin. In addition, the Company is required to pay a quarterly commitment fee based on the average unfunded portion of the committed amount at a rate based on the Company’s ratio of funded debt to EBITDA, as defined, that ranges from 37.5 to 50 basis points. As of March 31, 2015, the commitment fee was 50 basis points.
The obligations under the Revolving Credit Facility are secured by a portion of the Company’s helicopter fleet and the Company’s other tangible and intangible assets and are guaranteed by Era Group’s wholly owned U.S. subsidiaries. The Revolving Credit Facility contains various restrictive covenants including interest coverage, funded debt to EBITDA, and fair market value of mortgaged helicopters plus accounts receivable and inventory to funded debt, as well as other customary covenants including certain restrictions on the Company’s ability to enter into certain transactions, including those that could result in the incurrence

10

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of additional indebtedness and liens, the making of loans, guarantees or investments, sales of assets, payments of dividends or repurchases of capital stock, and entering into transactions with affiliates.
As of March 31, 2015, Era Group had $90.0 million of outstanding borrowings under the Revolving Credit Facility, and the remaining availability was $209.2 million, net of issued letters of credit of $0.8 million. In connection with the amendment of the Revolving Credit Facility, Era Group incurred debt issuance costs of $2.4 million. Such costs are included in other assets on the condensed consolidated balance sheets and are amortized to interest expense in the condensed consolidated statements of operations over the life of the Revolving Credit Facility.
Promissory Notes. During the three months ended March 31, 2015, Era Group made scheduled payments on other long-term debt of $0.7 million.
8.
COMMITMENTS AND CONTINGENCIES
Fleet. The Company’s unfunded capital commitments as of March 31, 2015 consisted primarily of agreements to purchase helicopters and totaled $195.2 million, of which $90.2 million is payable during the remainder of 2015 with the balance payable through 2017. The Company also had $1.8 million of deposits paid on options not yet exercised. The Company may terminate $102.9 million of its total commitments (inclusive of deposits paid on options not yet exercised) without further liability other than aggregate liquidated damages of $2.5 million.
Included in these commitments are orders to purchase nine AW189 heavy helicopters, four S92 heavy helicopters and five AW169 light twin helicopters. The AW189 and S92 helicopters are scheduled to be delivered in 2015 through 2017. Delivery dates for the AW169 helicopters have yet to be determined. In addition, the Company had outstanding options to purchase up to an additional ten AW189 helicopters and five S92 helicopters. If these options are exercised, the helicopters would be scheduled for delivery beginning in 2016 through 2018.
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 its consolidated financial position, results of operations or cash flows.
In April 2014, the Company entered into a settlement agreement with Airbus Helicopters (formerly Eurocopter), a division of Airbus Group (formerly European Aeronautic Defense and Space Company), with respect to the extended suspension of operations of H225 heavy helicopters in 2012 and 2013. The settlement agreement provides for certain service and product credit discounts, including credits that will be available to the Company for a period of four years from the date of the agreement to be applied against support services available from Airbus Helicopters covering spare parts, repair and overhaul, service bulletins, technical assistance or any other services available from Airbus Helicopters. The Company expects to be able to apply such service credits over the next four to five quarters, and such credits will be recognized in the Company’s statements of operations as a reduction in operating expenses in the periods utilized.  During the three months ended March 31, 2015, the Company utilized credits in the amount of $1.3 million.
9.
EARNINGS (LOSS) PER COMMON SHARE
Basic earnings 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 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.

11

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Computations of basic and diluted earnings per common share of the Company were as follows (in thousands, except share and per share data):
 
 
Three Months Ended 
 March 31,
 
 
2015
 
2014
Net income (loss) attributable to Era Group Inc.(1)
 
$
(42
)
 
$
4,389

Shares:
 
 
 
 
Weighted average number of common shares outstanding—basic
 
20,195,955

 
19,952,930

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

 
72,205

Weighted average number of common shares outstanding—diluted
 
20,195,955

 
20,025,135

 
 
 
 
 
Earnings (loss) per common share:
 
 
 
 
Basic
 
$

 
$
0.22

Diluted
 
$

 
$
0.22

____________________
(1)
Excludes net income of $0 and $56 attributable to unvested common shares for the three months ended March 31, 2015 and 2014, respectively.
(2)
Excludes weighted average common shares of 114,955 and 6,000 for the three months ended March 31, 2015 and 2014, respectively, for certain share awards as the effect of their inclusion would have been antidilutive.
10.
RELATED PARTY TRANSACTIONS
In January 2015, the Company extended its Amended and Restated Transition Services Agreement with SEACOR through July 31, 2015. During the three months ended March 31, 2015 and 2014, the Company incurred costs of $0.4 million and $0.8 million, respectively, under the Amended and Restated Transition Services Agreement, which are classified in administrative and general expenses in the condensed consolidated statements of operations. As of March 31, 2015 and December 31, 2014, the Company had a payable due to SEACOR of $0.1 million and $0.3 million, respectively.
11.
SHARE-BASED COMPENSATION
Restricted Stock Awards. The number of shares and weighted average grant price of restricted stock awards during the three months ended March 31, 2015 were as follows:
 
Number of Shares
 
Weighted Average Grant Price
Non-vested as of December 31, 2014
195,920

 
$
25.48

Restricted stock awards granted:
 
 
 
Non-employee directors
16,938

 
$
21.26

Employees
162,050

 
$
21.26

Vested
(64,677
)
 
$
25.43

Forfeited
(450
)
 
$
23.40

Non-vested as of March 31, 2015
309,781

 
$
23.05

The total fair value of shares vested during the three months ended March 31, 2015 and 2014 was $1.6 million and $2.3 million, respectively.
Stock Options. During the three months ended March 31, 2015, the Company awarded 60,000 stock options. The Company uses a Black-Scholes option pricing model to estimate the fair value of stock options. The following table shows the assumptions used to compute the share-based compensation expense for stock options granted during the three months ended March 31, 2015:

12

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Risk free interest rate
 
1.47
%
Expected life (years)
 
5

Volatility
 
35.11
%
Dividend yield
 
%
Weighted average exercise price of options granted (per option)
 
$
21.26

Weighted average grant-date fair value of options granted (per option)
 
$
7.04

Employee Stock Purchase Plan (“ESPP”). During the three months ended March 31, 2015, the Company issued 32,631 shares under the ESPP. As of March 31, 2015, 214,283 shares remain available for issuance under the ESPP.
Total share-based compensation expense, which includes stock options, restricted stock and the ESPP, was $0.6 million and $1.6 million for the three months ended March 31, 2015 and 2014, respectively.
12.
SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION
On December 7, 2012, Era Group issued the 7.750% Senior Notes. Era Group’s payment obligations under the 7.750% Senior Notes are jointly and severally guaranteed by all of its existing 100% 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 Era Group may incur in the future (the “Guarantors”). All the Guarantors currently guarantee the Revolving Credit Facility, and the guarantees of the Guarantors are full and unconditional and joint and several.
As a result of the agreement by these subsidiaries to guarantee the 7.750% Senior Notes, the Company is presenting the following condensed consolidating balance sheets and statements of operations, comprehensive income and cash flows for Era Group (“Parent”), the Guarantors, and the Company’s other subsidiaries (“Non-guarantors”). These statements should be read in conjunction with the unaudited condensed consolidated financial statements of the Company. The supplemental condensed consolidating financial information has been prepared pursuant to the rules and regulations for condensed financial information and does not include all disclosures included in annual financial statements.

13

Table of Contents

Supplemental Condensed Consolidating Balance Sheet as of March 31, 2015
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands, except share data)
ASSETS
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
14,964

 
$
16,528

 
$
2,199

 
$

 
$
33,691

Receivables:
 
 
 
 
 
 
 
 
 
Trade, net of allowance for doubtful accounts of $1,926
39

 
38,910

 

 

 
38,949

Other, net of allowance for doubtful accounts of $437
66

 
2,501

 

 

 
2,567

Inventories, net

 
26,189

 

 

 
26,189

Deferred income taxes
7,986

 

 

 
(5,819
)
 
2,167

Prepaid expenses and other
739

 
3,342

 

 

 
4,081

Escrow deposits

 
2,800

 

 

 
2,800

Total current assets
23,794

 
90,270

 
2,199

 
(5,819
)
 
110,444

Property and equipment

 
1,161,611

 
9,937

 

 
1,171,548

Accumulated depreciation

 
(313,122
)
 
(2,277
)
 

 
(315,399
)
Net property and equipment

 
848,489

 
7,660

 

 
856,149

Equity investments and advances

 
31,397

 

 

 
31,397

Investments in consolidated subsidiaries
184,685

 

 

 
(184,685
)
 

Goodwill

 
352

 

 

 
352

Intercompany receivables
627,077

 
12,420

 
1,391

 
(640,888
)
 

Other assets
6,445

 
8,711

 

 

 
15,156

Total assets
$
842,001

 
$
991,639

 
$
11,250

 
$
(831,392
)
 
$
1,013,498

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
$
144

 
$
13,672

 
$
88

 
$

 
$
13,904

Accrued wages and benefits

 
6,822

 

 

 
6,822

Accrued interest
4,772

 
19

 

 

 
4,791

Current portion of long-term debt

 
26,729

 

 

 
26,729

Derivative instruments

 
275

 

 

 
275

Accrued income taxes

 
37

 

 

 
37

Other current liabilities
610

 
2,511

 

 

 
3,121

Total current liabilities
5,526

 
50,065

 
88

 

 
55,679

Long-term debt
277,424

 

 

 

 
277,424

Deferred income taxes

 
223,019

 

 
(5,819
)
 
217,200

Intercompany payables
97,399

 
531,069

 
12,420

 
(640,888
)
 

Other liabilities

 
1,937

 

 

 
1,937

Total liabilities
380,349

 
806,090

 
12,508

 
(646,707
)
 
552,240

Equity:
 
 
 
 
 
 
 
 
 
Era Group Inc. stockholders’ equity:
 
 
 
 
 
 
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,582,841 outstanding, exclusive of treasury shares
206

 

 

 

 
206

Additional paid-in capital
430,251

 
99,845

 
496

 
(100,341
)
 
430,251

Retained earnings
31,755

 
86,098

 
(1,754
)
 
(84,344
)
 
31,755

Treasury shares, at cost, 19,059 shares
(560
)
 

 

 

 
(560
)
Accumulated other comprehensive income, net of tax

 
93

 

 

 
93

Total Era Group Inc. stockholders’ equity
461,652

 
186,036

 
(1,258
)
 
(184,685
)
 
461,745

Noncontrolling interest in subsidiary

 
(487
)
 

 

 
(487
)
Total equity
461,652

 
185,549

 
(1,258
)
 
(184,685
)
 
461,258

Total liabilities and stockholders’ equity
$
842,001

 
$
991,639

 
$
11,250

 
$
(831,392
)
 
$
1,013,498


14

Table of Contents

Supplemental Condensed Consolidating Balance Sheet as of December 31, 2014
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands, except share data)
ASSETS
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
16,481

 
$
22,188

 
$
2,198

 
$

 
$
40,867

Receivables:
 
 
 
 
 
 
 
 
 
Trade, net of allowance for doubtful accounts of $1,955
39

 
33,351

 

 

 
33,390

Other, net of allowance for doubtful accounts of $437
65

 
1,997

 

 

 
2,062

Inventories, net

 
26,869

 

 

 
26,869

Deferred income taxes
4,083

 

 

 
(2,087
)
 
1,996

Prepaid expenses and other
424

 
2,237

 

 

 
2,661

Escrow deposits

 

 

 

 

Total current assets
21,092

 
86,642

 
2,198

 
(2,087
)
 
107,845

Property and equipment

 
1,161,330

 
9,937

 

 
1,171,267

Accumulated depreciation

 
(306,010
)
 
(2,131
)
 

 
(308,141
)
Net property and equipment

 
855,320

 
7,806

 

 
863,126

Equity investments and advances

 
31,753

 

 

 
31,753

Investments in consolidated subsidiaries
182,294

 

 

 
(182,294
)
 

Goodwill

 
352

 

 

 
352

Intercompany receivables
616,932

 
12,258

 
1,395

 
(630,585
)
 

Other assets
6,914

 
7,184

 

 

 
14,098

Total assets
$
827,232

 
$
993,509

 
$
11,399

 
$
(814,966
)
 
$
1,017,174

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses
$
299

 
$
14,817

 
$
4

 
$

 
$
15,120

Accrued wages and benefits

 
7,521

 

 

 
7,521

Accrued interest
930

 
19

 

 

 
949

Current portion of long-term debt

 
27,426

 

 

 
27,426

Derivative instruments
784

 
325

 

 

 
1,109

Accrued income taxes

 
267

 

 

 
267

Other current liabilities
556

 
2,606

 

 

 
3,162

Total current liabilities
2,569

 
52,981

 
4

 

 
55,554

Long-term debt
282,118

 

 

 

 
282,118

Deferred income taxes

 
219,114

 

 
(2,087
)
 
217,027

Intercompany payables
81,986

 
536,341

 
12,258

 
(630,585
)
 

Other liabilities

 
2,111

 

 

 
2,111

Total liabilities
366,673

 
810,547

 
12,262

 
(632,672
)
 
556,810

Equity:
 
 
 
 
 
 
 
 
 
Era Group Inc. stockholders’ equity:
 
 
 
 
 
 
 
 
 
Common stock, $0.01 par value, 60,000,000 shares authorized; 20,371,672 outstanding, exclusive of treasury shares
204

 

 

 

 
204

Additional paid-in capital
429,109

 
99,845

 
496

 
(100,341
)
 
429,109

Retained earnings
31,797

 
83,312

 
(1,359
)
 
(81,953
)
 
31,797

Treasury shares, at cost, 18,609 shares
(551
)
 

 

 

 
(551
)
Accumulated other comprehensive income, net of tax

 
95

 

 

 
95

Total Era Group Inc. stockholders’ equity
460,559

 
183,252

 
(863
)
 
(182,294
)
 
460,654

Noncontrolling interest in subsidiary

 
(290
)
 

 

 
(290
)
Total equity
460,559

 
182,962

 
(863
)
 
(182,294
)
 
460,364

Total liabilities and stockholders’ equity
$
827,232

 
$
993,509

 
$
11,399

 
$
(814,966
)
 
$
1,017,174



15

Table of Contents

Supplemental Condensed Consolidating Statements of Operations for the Three Months Ended March 31, 2015
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Operating revenues
$

 
$
67,415

 
$

 
$

 
$
67,415

Costs and expenses:
 
 
 
 
 
 
 
 
 
Operating

 
43,517

 
88

 

 
43,605

Administrative and general
1,374

 
8,369

 

 

 
9,743

Depreciation

 
11,456

 
146

 

 
11,602

Total costs and expenses
1,374

 
63,342

 
234

 

 
64,950

Gains on asset dispositions, net

 
3,388

 

 

 
3,388

Operating income (loss)
(1,374
)
 
7,461

 
(234
)
 

 
5,853

Other income (expense):
 
 
 
 
 
 
 
 
 
Interest income
5

 
245

 
1

 

 
251

Interest expense
(3,352
)
 
(193
)
 

 

 
(3,545
)
Intercompany interest income (expense)

 
162

 
(162
)
 

 

Gain on debt extinguishment
264

 

 

 

 
264

Derivative losses, net

 
(12
)
 

 

 
(12
)
Foreign currency gains (losses), net
542

 
(3,502
)
 

 

 
(2,960
)
Total other income (expense)
(2,541
)
 
(3,300
)
 
(161
)
 

 
(6,002
)
Income (loss) before income taxes and equity earnings
(3,915
)
 
4,161

 
(395
)
 

 
(149
)
Income tax expense (benefit)
(1,482
)
 
1,427

 

 

 
(55
)
Income (loss) before equity earnings
(2,433
)
 
2,734

 
(395
)
 

 
(94
)
Equity losses, net of tax

 
(145
)
 

 

 
(145
)
Equity in earnings (losses) of subsidiaries
2,391

 

 

 
(2,391
)
 

Net income (loss)
(42
)
 
2,589

 
(395
)
 
(2,391
)
 
(239
)
Net loss attributable to non-controlling interest in subsidiary

 
197

 

 

 
197

Net income (loss) attributable to Era Group Inc.
$
(42
)
 
$
2,786

 
$
(395
)
 
$
(2,391
)
 
$
(42
)

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Table of Contents

Supplemental Condensed Consolidating Statements of Operations for the Three Months Ended March 31, 2014
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Operating revenues
$

 
$
79,231

 
$
212

 
$

 
$
79,443

Costs and expenses:
 
 
 
 
 
 
 
 
 
Operating

 
49,583

 
57

 

 
49,640

Administrative and general
1,767

 
9,567

 

 

 
11,334

Depreciation

 
11,141

 
146

 

 
11,287

Total costs and expenses
1,767

 
70,291

 
203

 

 
72,261

Gains on asset dispositions, net

 
2,891

 

 

 
2,891

Operating income
(1,767
)
 
11,831

 
9

 

 
10,073

Other income (expense):
 
 
 
 
 
 
 
 
 
Interest income
24

 
120

 
1

 

 
145

Interest expense
(3,541
)
 
(212
)
 

 

 
(3,753
)
Intercompany interest income (expense)

 
153

 
(153
)
 

 

Derivative losses, net

 
(30
)
 

 

 
(30
)
Foreign currency losses, net

 
(57
)
 

 

 
(57
)
Total other income (expense)
(3,517
)
 
(26
)
 
(152
)
 

 
(3,695
)
Income (loss) before income taxes and equity earnings
(5,284
)
 
11,805

 
(143
)
 

 
6,378

Income tax expense (benefit)
(2,057
)
 
4,560

 

 

 
2,503

Income (loss) before equity earnings
(3,227
)
 
7,245

 
(143
)
 

 
3,875

Equity earnings, net of tax

 
499

 

 

 
499

Equity in earnings (losses) of subsidiaries
7,672

 

 

 
(7,672
)
 

Net income (loss)
4,445

 
7,744

 
(143
)
 
(7,672
)
 
4,374

Net loss attributable to non-controlling interest in subsidiary

 
71

 

 

 
71

Net income (loss) attributable to Era Group Inc.
$
4,445

 
$
7,815

 
$
(143
)
 
$
(7,672
)
 
$
4,445


17

Table of Contents

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Three Months Ended March 31, 2015
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net income (loss)
(42
)
 
2,589

 
(395
)
 
(2,391
)
 
$
(239
)
Other comprehensive loss:
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments

 
(3
)
 

 

 
(3
)
Income tax benefit

 
1

 

 

 
1

Total other comprehensive loss

 
(2
)
 

 

 
(2
)
Comprehensive income (loss)
(42
)
 
2,587

 
(395
)
 
(2,391
)
 
(241
)
Comprehensive loss attributable to non-controlling interest in subsidiary

 
197

 

 

 
197

Comprehensive income (loss) attributable to Era Group Inc.
$
(42
)
 
$
2,784

 
$
(395
)
 
$
(2,391
)
 
$
(44
)

Supplemental Condensed Consolidating Statements of Comprehensive Income for the Three Months Ended March 31, 2014
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net income (loss)
4,445

 
7,744

 
(143
)
 
(7,672
)
 
$
4,374

Other comprehensive loss:
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments

 
(2
)
 

 

 
(2
)
Income tax benefit

 
1

 

 

 
1

Total other comprehensive loss

 
(1
)
 

 

 
(1
)
Comprehensive income (loss)
4,445

 
7,743

 
(143
)
 
(7,672
)
 
4,373

Comprehensive loss attributable to non-controlling interest in subsidiary

 
71

 

 

 
71

Comprehensive income (loss) attributable to Era Group Inc.
$
4,445

 
$
7,814

 
$
(143
)
 
$
(7,672
)
 
$
4,444



18

Table of Contents

Supplemental Condensed Consolidating Statements of Cash Flows for the Three Months Ended March 31, 2015
 
Parent
 
Guarantors
 
Non-guarantors
 
Eliminations
 
Consolidated
 
(in thousands)
Net cash provided by (used in) operating activities
$
(1,517
)
 
$
8,304

 
$
1

 
$

 
$
6,788

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
Purchases of property and equipment

 
(8,866
)
 

 

 
(8,866
)
Proceeds from disposition of property and equipment