28-Aug-2013 Source: Erickson Air-Crane
Erickson Air-Crane Incorporated (NASDAQ:EAC)(“Erickson” or “the Company”), a leading global provider of aviation services to a diverse mix of commercial and government customers, and the vertically-integrated manufacturer and operator of the powerful heavy-lift Erickson S-64 Aircrane helicopter, announced today that it had received a firm-fixed price contract to provide ship-based and shore-based vertical replenishment and other rotary-wing logistic services to Military Sealift Command, for support of the US 5th and 7th fleets, operating primarily in the Pacific and Indian Oceans.
This new contract, which was awarded competitively to Evergreen Helicopters International, a wholly owned subsidiary of the Company, commences on October 1, 2013, has a first year value of $6.8 million and four additional option-year renewals for a cumulative total value of $36.6 million. Work to be performed includes search and rescue support, medical evacuations, passenger transfers, internal cargo movement and dynamic interface testing.
Udo Rieder, Chief Executive Officer of Erickson, commented, “We are pleased to have been selected to provide these important services to the Sealift Command. This new award for Evergreen underlines our growth opportunity and further cements our position as a preferred provider of services for a wide variety of missions in support of Defense Department operations around the world.”
Operations will be based out of Naval Base Guam, with multiple rotorcraft operating around both the Pacific and Indian Oceans. The Company noted that Military Sealift Command’s vertical replenishment (VERTREP) program creates efficiency, enables ships to remain at sea for extended periods, improves safety and elevates mission readiness levels.
About Erickson Air-Crane Incorporated
Erickson Air-Crane Incorporated is a leading global provider of aviation services to a diverse mix of commercial and government customers. The Company currently operates a diverse fleet of 85 rotary-wing and fixed wing aircraft, including a fleet of 20 heavy-lift S-64 Aircranes. This fleet supports a wide and worldwide variety of government and commercial customers, across a broad range of aerial services, including critical supply and logistics for deployed military forces, humanitarian relief, firefighting, timber harvesting, infrastructure construction, and crewing. The Company also maintains a vertical manufacturing capability for the S-64 Aircrane, related components, and other aftermarket support and maintenance, repair, and overhaul services for the Aircrane and other aircraft.
Founded in 1971, Erickson Air-Crane is headquartered in Portland, Oregon and maintains facilities and operations in North America, South America, the Middle East, Africa and Asia-Pacific. For more information, please visit www.ericksonaircrane.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements that are subject to substantial risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. You can identify forward-looking statements by words such as “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “plan,” “expect,” “predict,” “potential,” or the negative of these terms or other comparable terminology. These forward-looking statements are based on management’s current expectations but they involve a number of risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in the forward-looking statements as a result of risks and uncertainties, which include: the possibility that we do not complete the acquisition of the Brazilian air logistics business, or realize the benefits of the acquisition of EHI or the Brazilian air logistics business on a timely basis or at all; our ability to integrate these businesses successfully or in a timely and cost-efficient manner; our ability to successfully enter new markets and manage international expansion; that we do not have extensive operating history in the aerial services segments in which EHI and Air Amazonia operate nor with the types of aircraft we acquired in the EHI acquisition and those we would in the Air Amazonia acquisition; that we do not have extensive operating history in South America, the Middle East and Africa, which are where EHI and Air Amazonia provide aerial services; that we do not have any operating history providing services to the Department of Defense and related customers and projects, which are segments to which EHI provides services; that the anticipated reduction in troops in Afghanistan in the near-term may adversely affect EHI; that EHI operates in certain dangerous and war-affected areas, which may result in hazards to its fleet and personnel; that, despite our current indebtedness levels, we and our subsidiaries may still incur significant additional indebtedness; our failure to obtain any required financing on favorable terms; our safety record; the hazards associated with our helicopter operations, which involve significant risks and which may result in hazards that may not be covered by our insurance or may increase the cost of our insurance; compliance with debt obligations and our substantial indebtedness, which could adversely affect our financial condition and impair our ability to grow and operate our business; cancellations; reductions or delays in customer orders; our ability to collect on customer receivables; weather and seasonal fluctuations that impact our Aircrane and other aerial services activities; competition; reliance on a small number of large customers; the impact of short-term contracts; the availability and size of the Aircrane fleet; the ability to implement production rate changes; the impact of government spending; the impact of product liability and product warranties; the ability to attract and retain qualified personnel; the impact of environmental and other regulations, including FAA regulations and similar international regulations; our ability to accurately forecast financial guidance; our ability convert backlog into revenues and appropriately plan expenses; worldwide economic conditions (including conditions in Greece and Italy); our reliance on a small number of manufacturers; the necessity to provide components or services to owners and operators of aircraft; our ability to effectively manage our growth; our ability to keep pace with changes in technology; our ability to adequately protect our intellectual property; our ability to successfully enter new markets and manage international expansion; our ability to expand and diversify our customer base; our ability to expand and market manufacturing and maintenance, repair and overhaul services; the potential unionization of our employees; the fluctuation in the price of fuel; our ability to access public or private debt markets; the impact of equipment failures or other events impacting the operation of our factories; and our ability to successfully manage any future acquisitions; as well as other risks and uncertainties more fully described under the heading “Risk Factors” in our most recently filed Annual Report on Form 10-K as well as the other reports we file with the SEC.
You should not place undue reliance on any forward-looking statements. Erickson Air-Crane assumes no obligation to update forward-looking statements to reflect actual results, changes in assumptions, or changes in other factors affecting forward-looking information, except to the extent required by applicable laws.
The official DoD notification was as follows:-
Evergreen Helicopters Inc., McMinnville, Ore., is being awarded a $6,765,700 firm- fixed-price contract to provide ship-based and shore-based vertical replenishment and other rotary-wing logistic services. These include search and rescue support; medical evacuations; passenger transfers, internal cargo movement; and dynamic interface testing in support of Commander, Naval Air Forces Command. Evergreen Helicopters, Inc., will provide helicopters, personnel, support equipment, and all supplies necessary to perform flight operations in the U.S. 5th Fleet and U.S. 7th Fleet areas of responsibility. This contract includes four one-year option periods, which, if exercised, would bring the cumulative value of this contract to $36,620,242. Work will be performed in U.S. 5th Fleet and U.S. 7th Fleet areas of responsibility and is expected to be completed September 2014. If all option periods are exercised, work will continue through September 2018. No contract funds will be obligated at the time of award. No contract funds will expire at the end of the current fiscal year. This contract was competitively procured with more than 50 companies solicited via the Military Sealift Command’s procurement website, the Navy Electronic Commerce Online website, and the Federal Business Opportunities website, with three offers received. The Military Sealift Command, Washington, D.C., is the contracting activity (N00033-13-C-8000).