Canadian Helicopters Income Fund (TSX: CHL.UN) (the â€œFundâ€), the largest helicopter transportation services company operating in Canada, is pleased to announce that it has been advised it has been awarded additional work in Afghanistan by the United States Transportation Command (â€œUSTRANSCOMâ€). This new contract, similar to previous awards, entails the movement of supplies and passengers to military forward operating locations, and involves the provision of two crewed and supported Sikorsky S61 heavy category and four Bell 212 medium category helicopters. One of the aircraft will be provided from the existing fleet of Canadian Helicopters, and five will be acquired.
The Fund has been providing support in Afghanistan since the first quarter of 2009. Canadian Helicopters current operations in Afghanistan include the provision of 5 medium and heavy helicopters. This award will bring the total contracted complement to 11 aircraft.
The prime contractor is the Canadian Commercial Corporation, Canada’s international contracting agency, which focuses on government-to-government contracting and procurement. The additional services, scheduled to commence phasing in through the fourth quarter of 2010 with full ramp up scheduled for early 1st quarter, 2011, will be for an initial 1 year base period with 4 additional one-year and a final 8-month renewal option periods to June 30th 2016, exercisable at the discretion of USTRANSCOM . The contract is denominated in U.S. dollars and is comprised primarily of a fixed monthly rate and variable hourly revenue components.
Total revenue to the Fund is expected to be in excess of US$360 million, assuming all option periods are exercised and expected hours flown. Revenue for this contract reflects the significantly higher level of effort required to accomplish the work in Afghanistan.
“We are extremely pleased to have been awarded a 3rd piece of business with the U.S. military in Afghanistan. This challenging work provides us the opportunity to continue to use our skills and demonstrate our support capabilities in remote locations and in a hostile flying environmentâ€ said Don Wall, President and Chief Executive Officer of Canadian Helicopters. â€œIf all option periods are exercised, the contract will be the largest the Fund has been awarded since our initial public offering in 2005.â€
ABOUT CANADIAN HELICOPTERS INCOME FUND
Through Canadian Helicopters Limited, Canadian Helicopters Income Fund is the largest helicopter transportation services company operating in Canada and one of the largest in the world based on the size of its fleet. With over 35 base locations across Canada, Canadian Helicopters provides helicopter services to a broad range of sectors, including emergency medical services, infrastructure maintenance, utilities, oil and gas, mining, forestry and construction. In addition to helicopter transportation services, Canadian Helicopters operates two flight schools, provides third party repair and maintenance services in Canada and provides military support in Afghanistan. With over 60 years of experience, Canadian Helicopters is an industry leader in establishing safety standards and operating procedures.
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