United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: July 31, 1996
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 0-9827
PETROLEUM HELICOPTERS, INC.
(Exact name of registrant as specified in its charter)
Louisiana 72-0395707
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2121 Airline Highway, Suite 400
P. O. Box 578
Metairie, Louisiana 70001-5979
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (504)828-3323
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 X NO ___
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Class Outstanding at September 3, 1996
Voting Common Stock 2,799,761
Non-Voting Common Stock 2,276,093
PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
PETROLEUM HELICOPTERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
In thousands (Current period unaudited) July 31, April 30,
1996 1996 (1)
__________ ________
ASSETS
Current assets:
Cash and cash equivalents $ 2,384 $ 1,899
Accounts receivable - net
of allowance 33,687 28,725
Refundable income taxes - 737
Inventory 27,098 25,947
Prepaid expenses 1,043 1,159
Notes receivable - investee companies 837 1,166
------- -------
Total current assets 65,049 59,633
------- -------
Notes receivable 358 358
Investments 5,601 4,890
Property and equipment:
Cost 224,313 212,801
Less accumulated depreciation (118,477) (116,469)
------- -------
105,836 96,332
------- -------
Other 104 102
------- -------
$ 176,948 $ 161,315
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and
accrued expenses $ 17,857 $ 19,467
Accrued vacation pay 4,694 4,813
Income taxes payable 744 -
Current portion of long-term debt 8,824 8,810
------- -------
Total current liabilities 32,119 33,090
------- -------
Long-term debt 42,986 28,522
Deferred income taxes 14,966 14,966
Other long-term liabilities 3,430 3,336
Shareholders' equity:
Voting common stock 280 280
Non-voting common stock 227 227
Additional paid-in capital 10,220 10,220
Retained earnings 72,720 70,674
------- -------
83,447 81,401
------- -------
$ 176,948 $ 161,315
======= =======
(1)The balance sheet at April 30, 1996 is condensed from the
audited financial statements at that date. See notes to
condensed consolidated financial statements.
PETROLEUM HELICOPTERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
In thousands, except per Three months Ended July 31,
share amounts 1996 1995
(unaudited) ---- ----
REVENUES:
Operating revenues $50,240 $46,379
Gain on equipment
disposals 4 331
Equity in net earnings
of investee companies 29 -
------- -------
50,273 46,710
------- -------
EXPENSES:
Direct expenses 42,403 41,072
Selling, general and
administrative expenses 3,142 2,457
Interest expense 867 777
------- -------
46,412 44,306
Earnings before income ------- -------
taxes 3,861 2,404
Income taxes 1,583 1,013
------- -------
Net earnings $ 2,278 $ 1,391
======= =======
Net earnings per share $ 0.45 $ 0.27
======= =======
Weighted average common
shares outstanding 5,076 5,065
======= =======
Dividends declared per common
share $ 0.05 $ 0.02
======= =======
See notes to condensed consolidated financial statements.
PETROLEUM HELICOPTERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
In thousands
(unaudited) Three Months Ended July 31,
1996 1995
---- ----
OPERATING ACTIVITIES:
Net Earnings $ 2,278 $ 1,391
Depreciation 2,265 1,963
Gain on equipment disposals (4) (331)
Equity in net earnings
of investee companies (29) -
Changes in operating assets
and liabilities (5,179) 2,035
------- -------
Net cash provided (used) by operating
activities (669) 5,058
INVESTING ACTIVITIES:
Investments (657) (3,967)
Purchases of property and
equipment (12,425) (4,436)
Proceeds from equipment disposals 12 359
Other - -
------- -------
Net cash used by
investing activities (13,070) (8,044)
------- -------
FINANCING ACTIVITIES:
Proceeds from long-term debt 16,675 7,000
Payments on long-term debt (2,197) (4,183)
Dividends paid (254) (101)
------- -------
Net cash provided by
financing activities 14,224 2,716
------- -------
Increase (decrease) in cash
and cash equivalents 485 (270)
Cash and cash equivalents
at beginning of period 1,899 2,506
------- -------
Cash and cash equivalents
at end of period $ 2,384 $ 2,236
======= =======
See notes to condensed consolidated financial statements.
PETROLEUM HELICOPTERS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
THREE MONTHS ENDED JULY 31, 1996 AND 1995
(UNAUDITED)
A. These financial statements, except for the April 30,
1996 condensed consolidated balance sheet, have been prepared
without audit as permitted by the rules and regulations of
the Securities and Exchange Commission. Certain information
and footnote disclosures normally included in the financial
statements have been condensed or omitted pursuant to such
rules and regulations; however, the Company believes that
this information is fairly presented. These condensed
consolidated financial statements should be read in
conjunction with the financial statements contained in the
Company's Annual Report on Form 10-K for the year ended
April 30, 1996 and the accompanying notes and Management's
Discussion and Analysis of Financial Condition and Results of
Operations.
B. In the opinion of management, the accompanying unaudited
condensed consolidated financial statements contain all
adjustments, consisting of only normal, recurring adjustments,
necessary to fairly present the financial results for the
interim periods presented.
C. The Company's financial results, particularly as it
relates to its domestic oil and gas operations, areinfluenced
by seasonal fluctuations. During the winter,there are more
days of adverse weather conditions and fewerhours of daylight
than the other months of the year.Consequently, flight
hours are generally lower during the Company's third fiscal
quarter than at other times of the year. This produces a
seasonal aspect to the Company's business and typically
results in reduced revenues from operations during those months.
Therefore, the results of operations for interim periods are not
necessarily indicative of the operating results that may be
expected for the full fiscal year.
D. Primary earnings per share are computed based on the
weighted average number of shares and dilutive equivalent
shares of common stock (stock options) outstanding during
each year using the treasury stock method.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Company is engaged in providing helicopter
transportation and related services. The predominant portion
of its revenue is derived from transporting offshore oil and
gas production and drilling workers on a worldwide basis.
The Company also performs helicopter transportation services
for a variety of hospital and medical programs and aircraft
maintenance to outside parties.
RESULTS OF OPERATIONS
The following is a comparison of the first quarter of
the fiscal year ending April 30, 1997 with the comparable
period of the prior fiscal year.
Revenues
The Company generates revenues from both ongoing service
contracts with established customers and non-contract flights
referred to as Specials. Domestic Oil and Gas contracts are
generally on a month to month basis and consist of a fixed
fee plus an hourly charge for actual flight time. Specials
are customer flights, primarily domestic oil and gas,
provided on an as needed basis that are not provided pursuant
to ongoing contracts and which generally carry higher rates.
International and aeromedical contracts also provide for
fixed and hourly charges, but are generally for longer terms.
These contracts impose early cancellation fees to encourage
customers to fulfill the contract term and cover the
Company's additional upfront costs in the event of early
termination.
The following table summarizes and compares the
Company's revenues by certain market segments for the
quarters ended July 31, 1996 and 1995:
(Thousands of dollars, except Revenues for the Quarter
Ended July 31,
percentages and flight hours)
Incr (Decr)
---- ----
1996 1995 $ %
---- ---- -- --
Domestic Oil and Gas $35,028 $32,092 $ 2,936 9
Aeromedical Services 7,634 6,300 1,334 21
International, Technical 7,578 7,987 (409) (5)
Services, and Other ------ ------ ------ ---
Total Operating Revenues $50,240 $46,379 $ 3,861 8
====== ====== ====== ===
Total Flight Hours 62,876 55,514 7,362 13
====== ====== ====== ===
Domestic Oil and Gas
Domestic Oil and Gas revenues for the quarter ended July
31, 1996 increased 9% to $ 35 million from $ 32 million,
resulting in the best comparable quarterly revenues since the
quarter ended July 31, 1993. The Company primarily
attributes the increase to better economic conditions in the
Gulf of Mexico. The Company's current domestic market share
remained steady at 51%. Flight hours increased 10% to 47,033
hours from 42,711 hours, as compared to the quarter ended
July 31, 1995.
Aeromedical Services
Aeromedical revenues increased to $ 7.6 million, or 21%,
from $ 6.3 million. This increase is due primarily to the
addition of two new programs and the utilization of five
additional aircraft bringing the total Aeromedical contracts
and aircraft to 14 and 37 respectively. EMS flight hours
increased 25% to 3,952 hours.
International, Technical Services, and Other
International Oil & Gas revenues increased 12% to $ 4.8
million due primarily to increased flight hours and the
addition of one new contract. Flight hours rose 1,360 to
6,699 hours.
Technical Services revenues decreased $ 0.9 million to $
1.8 million.
Direct Expenses
Direct expenses increased $ 1.3 million, or 3%, to $
42.4 million primarily as a result of increased activity
levels. Direct expenses as a percentage of operating
revenues declined substantially which improved the Company's
operating margin to 16% from 11% in the prior year's
comparable quarter.
Human Resources costs increased $ 0.6 million, or 4%.
This increase is due primarily to the hiring of additional
personnel which were needed due to increased flight activity.
Helicopter expenses increased $ 0.3 million, or 2%, to $19
million. This increase, in percentage terms, was substantially
less than the revenue increase resulting in the improved margin
noted above. Fuel expense and aircraft depreciation increased
$ 0.5 million and $ 0.2 million, respectively, due to
increased flight activity and the purchase of twelve additional
aircraft. Other costs remained essentially constant as the Company's
resource utilization programs achieved favorable results. In addition,
insurance expense was reduced $ 0.3 million due primarily to a change
in the manner in which hull losses are estimated.
Selling, General, and Administrative Expenses
Selling, general and administrative expenses increased $ 0.7
million to $ 3.1 million. This increase was primarily a result
of consultant fees related to information system upgrades.
LIQUIDITY AND CAPITAL RESOURCES
The following is a comparison of the first quarter of
the fiscal year ending April 30, 1997 with the period ending
April 30, 1996.
The Company's cash position as of July 31, 1996 was
$ 2.4 million compared to $ 1.9 million at April 30, 1996, the
Company's fiscal year end. Working capital increased $ 6.4
million from $ 26.5 million at fiscal year end to $ 32.9
million. The increase was primarily related to an increase
in accounts receivable and inventory of $ 5 million and
$ 1.2 million, respectively, and a decrease in accounts
payable and accrued expenses of $ 1.6 million. This was
partially offset by the combined changes in refundable income
taxes and taxes payable of $ 1.5 million.
Total long-term debt increased $ 14.5 million to $ 51.8
million as a result of the investing activities described
below. The Company's current debt obligation for fiscal 1997
totals $ 8.8 million, payable in equal quarterly
installments, which the Company intends to pay with cash flow
from operations. At July 31, 1996, the Company had $ 8.4
million and $ 1.9 million of credit capacity available under
its term and revolving credit facilities, respectively. The
Company is in compliance with the provisions of its loan
agreement.
Cash used by operating activities was $ 0.7 million for
the quarter due primarily to the working capital increase
noted above. Investing activities primarily included the
purchase and completion of twelve aircraft. Investing
activities were primarily funded through increased borrowings
under the Company's credit facility. The Company also paid a
dividend of $ 0.05 per share during the first quarter of
fiscal 1997.
The Company continues to review selected domestic bases
for possible fuel contamination resulting from routine flight
operations, and to date the Company has identified known or
suspected fuel contamination at eight of its bases. Although
the full extent of contamination has not been determined,
based on this preliminary information, a provision of $ 1.7
million was made for remediation costs through the fiscal
year ended April 30, 1996 and an additional $ 0.4 million
provision was made in the first quarter of 1997. The Company
will make additional provisions to the extent necessary as
reliable estimates of these costs become available.
On August 13, 1996 the Company and its principal lending
group ratified a loan agreement that amended and restated its
original loan agreement dated January 31, 1986. The new
agreement increases the Company's credit capacity to $ 65
million from $ 55 million. In addition, the new agreement lowers
the Company's effective interest rate on its outstanding debt
under this facility.
RESULTS AT A GLANCE (Unaudited)
The following table provides a summary of critical
operating and financial statistics (thousands of dollars,
except per share amounts, financial ratios, flight hours and
general statistics):
Three Months Ended July 31,
Operations 1996 1995
---- ----
Operating revenues $ 50,240 $ 46,379
Net earnings 2,278 1,391
Net earnings per share .45 .27
Annualized return on
shareholders' equity 11% 7.3%
Total flight hours - operated 62,876 55,514
Financial Summary July 31, 1996 April 30, 1996
------------- --------------
Net working capital $32,930 $ 26,543
Net book value of
property and equipment 105,836 96,332
Long-term debt 42,986 28,522
General Statistics
Helicopters Operated 271 266
Employees 1,729 1,677
Part II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
3.1 (i) Articles of Incorporation of the Company
(incorporated by reference to Exhibit No. 3.1
(i) to PHI's Report on Form 10-Q for the quarterly
period ended October 31, 1994).
(ii)By-laws of the Company.
27 Financial Data Schedule.
(b) Reports on Form 8-K
No reports were filed on Form 8-K for the quarter ending
July 31, 1996.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
Petroleum Helicopters, Inc.
September 5, 1996 By: /s/ Carroll W. Suggs
---------------------
Carroll W. Suggs
Chairman of the Board,
President and Chief
Executive Officer
(duly authorized officer)
September 5, 1996 By: /s/ John H. Untereker
---------------------
John H. Untereker
Vice President and
Chief Financial Officer
(principal financial
officer)
Adopted 8/25/94
Amended 9/28/94
Amended 5/31/95 effective December 6, 1994
Amended July 31, 1996
Amended AugustAugust 18, 1996
BY-LAWS
of
PETROLEUM HELICOPTERS, INC.
SECTION 1
OFFICES
1.1 Principal Office. The principal office of the
Corporation shall be located at 2121 Airline Highway, Suite 400,
Metairie, Louisiana 70001-5979.
1.2 Additional offices. The Corporation may have such
offices at such other places as the Corporation's Board of
Directors (the "Board") may from time to time determine or the
business of the Corporation may require.
SECTION 2
SHAREHOLDERS MEETINGS
2.1 Place of Meetings. Unless otherwise required by law or
these By-laws, all meetings of the shareholders shall be held at
the principal office of the Corporation or at such other place,
within or without the State of Louisiana, as may be designated by
the Board.
2.2 Annual Meetings; Notice Thereof. An annual meeting of
the shareholders shall be held on the third Wednesday of October
in each year, beginning at 10:00 a.m., New Orleans time, or at
such other date or at such other time as may be specified by the
Board of Directors in the call of the meeting, for the purpose of
electing directors and for the transaction of such other business
as may be properly brought before the meeting. If no annual
shareholders' meeting is held for a period of eighteen months,
any shareholder may call such meeting to be held at the
registered office of the Corporation as shown on the records of
the Secretary of State of Louisiana.
2.3 Special Meetings. Special meetings of the share-
holders, for any purpose or purposes, may be called by the
Chairman of the Board, Chief Executive Officer and President (the
"Chairman, CEO and President") or the Board or by the
shareholders as provided in the Articles of Incorporation.
2.4 Notice of Meetings. Except as otherwise provided by
law, the authorized person or persons calling a shareholders'
meeting shall cause written notice of the time, place and purpose
of the meeting to be given to all shareholders entitled to vote
at such meeting, at least ten days and not more than sixty days
prior to the day fixed for the meeting. Notice of the annual
meeting need not state the purpose or purposes thereof, unless
action is to be taken at the meeting as to which notice is
required by law or the By-laws. Notice of a special meeting shall
state the purpose or purposes thereof, and the business conducted
at any special meeting shall be limited to the purpose or
purposes stated in the notice.
2.5 List of Shareholders. At every meeting of
shareholders, a list of shareholders entitled to vote, arranged
alphabetically and certified by the Corporation's Secretary or by
the agent of the Corporation having charge of transfers of
shares, showing the number and class of shares held by each such
shareholder on the record date for the meeting, shall be produced
on the request of any shareholder.
2.6 Quorum. At all meetings of shareholders, the holders
of a majority of the total voting power of the Corporation shall
constitute a quorum; provided that this subsection shall not have
the effect of reducing the vote required to approve or affirm any
matter that may be established by law, the Articles of
Incorporation or these By-laws.
2.7 Voting. When a quorum is present at any meeting, the
vote of the holders of a majority of the voting power present in
person or represented by proxy shall decide each question brought
before such meeting, unless the question is one upon which, by
express provision of law or the Articles of Incorporation, a
different vote is required, in which case such express provision
shall govern and control the decision of such question. Directors
shall be elected by plurality vote.
2.8 Proxies-General. At any meeting of the shareholders,
every shareholder having the right to vote shall be entitled to
vote in person or by proxy appointed by an instrument in writing
executed by such shareholder and bearing a date not more than
eleven months prior to the meeting, unless the instrument
provides for a longer period, but in no case will an outstanding
proxy be valid for longer than three years from the date of its
execution. The person appointed as proxy need not be a
shareholder of the Corporation.
2.9 Execution of Proxies. Any proxy must be executed by a
shareholder or the shareholder's authorized officer, director,
employee or agent. Any signature on a proxy may be affixed by
any reasonable means, including but not limited to facsimile
signature.
2.10 Electronically Transmitted Proxies. A shareholder may
authorize another person or persons to act for him as proxy by
transmitting or authorizing the transmission of a telegram,
cablegram or other means of electronic transmission to the person
who will be the holder of the proxy or to a proxy solicitation
firm, proxy support service organization or similar agent duly
authorized by the person who will be the holder of the proxy to
receive such transmission; provided, however, that any such
telegram, cablegram or other means of electronic transmission
shall be submitted with information from which the Corporation
may determine that the telegram, cablegram or other electronic
transmission was authorized by the shareholder. If it is
determined that such electronic transmissions are valid, the
inspectors or other persons making that determination shall
specify the information upon which they relied.
2.11 Validity of Copies and other Reproductions of Proxies.
Any copy, facsimile, telecommunication or other reliable
reproduction of the writing or transmission created pursuant
hereto may be substituted or used in lieu of the original writing
or transmission for all purposes for which the original writing
or transmission could be used; provided, however, that such copy,
facsimile telecommunication or other reliable reproduction shall
be a complete reproduction of the entire original writing or
transmission.
2.12 Voting Power Present or Represented. For purposes of
determining the amount of voting power present or represented at
any annual or special meeting of shareholders with respect to
voting on a particular proposal, shares as to which the proxy
holders have been instructed to abstain from voting on the
proposal, and shares that have been precluded from voting
(whether by law, regulations of the Securities and Exchange
Commission, rules or by-laws of any self-regulatory organization
or otherwise), will not be treated as present.
2.13 Adjournments. Adjournments of any annual or special
meeting of shareholders may be taken without new notice being
given unless a new record date is fixed for the adjourned
meeting, but any meeting at which directors are to be elected
shall be adjourned only from day to day until such directors
shall have been elected.
2.14 Withdrawal. If a quorum is present or represented at a
duly organized meeting, such meeting may continue to do business
until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum as fixed in Section 2.6
of these By-laws, or the refusal of any shareholders present to
vote.
2.15 Lack of Quorum. If a meeting cannot be organized
because a quorum has not attended, those present may adjourn the
meeting to such time and place as they may determine, subject,
however, to the provisions of Section 73C of the Business
Corporation Law of Louisiana. In the case of any meeting called
for the election of directors, those who attend the second of
such adjourned meetings, although less than a quorum as fixed in
Section 2.6 hereof, shall nevertheless constitute a quorum for
the purpose of electing directors.
2.16 Presiding officer. The Chairman, CEO and President or
in his or her absence, a chairman designated by the Board, shall
preside at all shareholders' meetings.
2.17 Definitions of Shareholder, Voting Power and Voting
Power Present. As used in these By-laws, and unless the context
otherwise requires, (a) the term "shareholder" shall mean a
person who is (i) the record holder of shares of the
Corporation's voting stock or (ii) a registered holder of any
bonds, debentures or similar obligations granted voting rights by
the Corporation pursuant to La. R.S. 12:75, (b) the term "voting
power" shall mean the right vested by law, these By-laws or the
Articles of Incorporation in the shareholders to vote in the
determination of a particular question or matter and (c) the term
"total voting power" shall mean the total number of votes that
the shareholders are entitled to cast in the determination of a
particular question or matter.
SECTION 3
DIRECTORS
3.1 Powers; Number. All of the corporate powers shall be
vested in, and the business and affairs of the Corporation shall
be managed by, the Board, which shall consist of six natural
persons; provided that, if after proxy material for any meeting
of shareholders at which directors are to be elected are mailed
to shareholders, any person or persons named therein to be
nominated at the direction of the Board becomes unable or
unwilling to serve, the foregoing number of authorized directors
shall be automatically reduced by a number equal to the number of
such persons unless the Board, by a majority vote of the entire
Board, selects an additional nominee; provided that in no event
shall the number of directors so authorized, nominated and
elected be less than the number required by law. No amendment to
this Section to decrease the number of directors shall shorten
the term of any incumbent director. No director need be a
shareholder.
3.2 Powers. The Board may exercise all such powers of the
Corporation and do all such lawful acts and things that are not
by law, the Articles of Incorporation or these By-laws directed
or required to be done by the shareholders.
3.3 General Election. At each annual meeting of share-
holders, directors shall be elected to succeed those directors
whose terms then expire. Such newly elected directors shall serve
until the next succeeding annual meeting of shareholders after
their election and until their successors are elected and
qualified. A director elected to fill a vacancy shall hold office
for a term expiring at the next annual meeting and until his
successor is elected and qualified. No decrease in the number of
directors constituting the Board shall shorten the term of any
incumbent director.
3.4 Vacancies. Except as otherwise provided in the
Articles of Incorporation or these By-laws (a) the office of a
director shall become vacant if he dies, resigns or is removed
from office and (b) the Board may declare vacant the office of a
director if he (i) is interdicted or adjudicated an incompetent,
(ii) is adjudicated a bankrupt, (iii) in the sole opinion of the
Board becomes incapacitated by illness or other infirmity so that
he is unable to perform his duties for a period of six months or
longer, or (iv) ceases at any time to have the qualifications
required by law, the Articles of Incorporation or these By-laws.
3.5 Filling Vacancies. In the event of a vacancy (includ-
ing any vacancy resulting from an increase in the authorized
number of directors, or from failure of the shareholders to elect
the full number of authorized directors), the remaining
directors, even though not constituting a quorum, may fill any
vacancy on the Board for the unexpired term by a majority vote of
the directors remaining in office, provided that the shareholders
shall have the right, at any special meeting called for the
purpose prior to such action by the Board, to fill the vacancy.
3.6 Notice of Shareholder Nominees. Only persons who are
nominated in accordance with the procedures set forth in this
Section 3.6 shall be eligible for election as directors. Nomina-
tions of persons for election to the Board may be made at a
meeting of shareholders by or at the direction of the Board or by
a shareholder entitled to vote for the election of directors at
the meeting who complies with the notice procedures set forth in
this Section 3.6. Such nominations, other than those made by or
at the direction of the Board, shall be made pursuant to timely
notice in writing to the Corporation's Secretary. To be timely,
a shareholder's notice must be delivered or mailed and received
at the principal executive offices of the Corporation not less
than 45 days nor more than 90 days prior to the meeting;
provided, however, that if less than 55 days notice or prior
public disclosure of the date of the meeting is given or made to
shareholders, notice by the shareholder to be timely must be
received no later than the close of business on the 10th day
following the day on which such notice of the date of the meeting
was mailed or such public disclosure was made. Such shareholder's
notice shall set forth the following:
(a) as to each person whom the shareholder proposes to
nominate for election or re-election as a director (i) the
name, age, business address and residence address of such
person, (ii) the principal occupation or employment of such
person, (iii) the class and number of shares of the capital
stock of the Corporation of which such person is the
beneficial owner and the number of votes such person is
entitled to cast at the shareholders' meeting and (iv) any
other information relating to such person that would be
required to be disclosed in solicitations of proxies for
election of directors, or would be otherwise required, in
each case pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended (including without
limitation such person's written consent to being named in
the proxy statement as a nominee and to serving as a
director if elected); and
(b) as to the shareholder giving the notice (i) the
name and address of such shareholder and (b) the class and
number of shares of the capital stock of the Corporation of
which such shareholder is the beneficial owner and the
number of votes such person is entitled to cast at the
shareholders' meeting. If requested in writing by the
Corporation's Secretary at least 15 days in advance of the
meeting, such shareholder shall disclose to the Secretary,
within 10 days of such request, whether such person is the
sole beneficial owner of the shares held of record by him;
and, if not, the name and address of each other person known
by the shareholder of record to claim a beneficial interest
in such shares.
At the request of the Board, any person nominated by or at the
direction of the Board for election as a director shall furnish
to the Corporation's Secretary that information required to be
set forth in a shareholder's notice of nomination that pertains
to the nominee. If a shareholder seeks to nominate one or more
persons as directors, the Secretary shall appoint two inspectors
(the "Inspectors"), who shall not be affiliated with the
Corporation, to determine whether a shareholder has complied with
this Section 3.6. If the Inspectors shall determine that a
shareholder has not complied with this Section 3.6, the
Inspectors shall direct the chairman of the meeting to declare to
the meeting that a nomination was not made in accordance with the
procedures prescribed by the Articles of Incorporation or these
By-laws; and the chairman shall so declare to the meeting and the
defective nomination shall be disregarded.
3.7 Compensation of Directors. Directors as such, shall
receive such compensation for their services as may be fixed by
resolution of the Board and shall receive their actual expenses
of attendance, if any, for each regular or special meeting of the
Board; provided that nothing herein contained shall be construed
to preclude any director from serving the Corporation in any
other capacity and receiving compensation therefor.
SECTION 4
MEETINGS OF THE BOARD
4.1 Place of Meetings. The meetings of the Board may be
held at such place within or without the State of Louisiana as a
majority of the directors may from time to time appoint.
4.2 Initial Meetings. The first meeting of each newly
elected Board shall be held immediately following the share-
holders' meeting at which the Board is elected and at the same
place as such meeting, and no notice of such first meeting shall
be necessary for the newly elected directors in order legally to
constitute the meeting.
4.3 Regular Meetings; Notice. Regular meetings of the
Board may be held at such times as the Board may from time to
time determine. No notice of regular meetings of the Board shall
be required provided that the date, time and place of regular
meetings are fixed by the Board.
4.4 Special Meetings; Notice. Special meetings of the
Board may be called by the Chairman, CEO and President on
reasonable notice given to each director, either personally or by
telephone, mail or by telegram. Special meetings shall be called
by the Chairman, CEO and President, or the Secretary in like
manner and on like notice on the written request of a majority of
the directors and if such officers fail or refuse, or are unable
within 24 hours to call a meeting when requested, then the
directors making the request may call the meeting on two days'
written notice given to each director. The notice of a special
meeting of directors need not state its purpose or purposes, but
if the notice states a purpose or purposes and does not state a
further purpose to consider such other business as may properly
come before the meeting, the business to be conducted at the
special meeting shall be limited to the purposes stated in the
notice.
4.5 Waiver of Notice. Directors present at any regular or
special meeting shall be deemed to have received due, or to have
waived, notice thereof, provided that a director who participates
in a meeting by telephone (as permitted by Section 4.9) shall not
be deemed to have received or waived due notice if, at the
beginning of the meeting, he objects to the transaction of any
business because the meeting is not lawfully called.
4.6 Quorum. A majority of the Board shall be necessary to
constitute a quorum for the transaction of business, and except
as otherwise provided by law or the Articles of Incorporation or
these By-laws, the acts of a majority of the entire Board at a
meeting at which a quorum is present shall be the acts of the
Board. If a quorum is not present at any meeting of the Board,
the directors present may adjourn the meeting from time to time
without notice other than announcement at the meeting, until a
quorum is present.
4.7 Withdrawal. If a quorum is present when the meeting
convened, the directors present may continue to do business,
taking action by vote of a majority of a quorum as fixed in
Section 4.6, until adjournment, notwithstanding the withdrawal of
enough directors to leave less than a quorum as fixed in Section
4.6 or the refusal of any director present to vote.
4.8 Action by Consent. Any action that may be taken at a
meeting of the Board or any committee thereof, may be taken by a
consent in writing signed by all of the directors or by all
members of the committee, as the case may be, and filed with the
records of proceedings of the Board or such committee.
4.9 Meetings by Telephone or Similar
Communication. Members of the Board may participate at and be
present at any meeting of the Board or any committee thereof by
means of conference telephone or similar communications equipment
if all persons participating in such meeting can hear and
communicate with each other. Participation in a meeting pursuant
to this Section 4.9 shall constitute presence in person at such
meeting, except where a person participates in the meeting for
the express purpose of objecting to the transaction of any
business on the ground that the meeting is not lawfully called or
convened.
SECTION 5
COMMITTEES OF THE BOARD
5.1 General. The Board may designate one or more
committees, each committee to consist of two or more of the
directors (and one or more directors may be named as alternate
members to replace any absent or disqualified regular members),
which, to the extent provided by resolution of the Board or the
By-laws, shall have and may exercise the powers of the Board in
the management of the business and affairs of the Corporation,
and may have power to authorize the seal of the Corporation to be
affixed to documents, but no such committee shall have power or
authority in reference to amending the Articles of Incorporation,
adopting an agreement of merger or consolidation, recommending to
the shareholders the sale, lease or exchange of all or
substantially all of the Corporation's property and assets,
recommending to the stockholders a dissolution of the Corporation
or a revocation of dissolution, removing or indemnifying
directors or amending the By-laws; and unless the resolution
expressly so provides, no such committee shall have the power or
authority to declare a dividend or authorize the issuance of
stock. Such committee or committees shall have such name or
names as may be stated in the By-laws, or as may be determined,
from time to time, by the Board. Any vacancy occurring in any
such committee shall be filled by the Board, but the Chairman of
the Board, Chief Executive Officer and President may designate
another director to serve on the committee pending action by the
Board. Each such member of a committee shall hold office during
the term of the Board constituting it, unless otherwise ordered
by the Board.
5.2 Compensation Committee. The Board shall establish a
Compensation Committee consisting of at least two directors each
of whom shall (i) be a "non-employee director" as defined under
Article 16b-3 promulgated under the Securities Exchange Act of
1934, as amended, and (ii) not serve, and shall not have served
in the past, as an officer or employee of the Corporation or any
of its affiliates. The Compensation Committee shall determine
the compensation to be paid to officers and key employees of the
Corporation.
5.3 Audit Committee. The Board shall establish an Audit
Committee consisting of at least two directors who are not
officers or employees of the Corporation or any of its
affiliates. The Audit Committee shall serve as a focal point for
communication between noncommittee directors, the independent
accountants and management. The Audit Committee shall make
recommendations to the Board concerning the selection and
retention of the Corporation's independent auditors, review the
results of audits of the Corporation by its independent auditors,
discuss audit representations with management, and report the
results of its review to the Board.
5.4 Procedures for Committees. Each committee shall keep
written minutes of its meetings and all actions taken by a
committee shall be reported to the Board at its next meeting,
whether regular or special. Failure to keep written minutes or
to make such reports shall not affect the validity of action
taken by a committee. Each committee shall adopt such rules (not
inconsistent with the Articles of Incorporation, these By-laws or
any regulations specified for such committee by the Board) as it
shall deem necessary for the proper conduct of its functions and
the performance of its responsibilities.
SECTION 6
REMOVAL OF BOARD MEMBER
Any director or the entire Board may be removed at any time
by the affirmative vote of not less than a majority of the voting
power present at a meeting of shareholders duly called for that
purpose. The shareholders at such meeting may proceed to elect a
successor or successors for the unexpired term of the director or
directors removed. Except as provided in this Section 6,
directors shall not be subject to removal.
SECTION 7
NOTICES
7.1 Form of Delivery. Whenever under the provisions of law
the Articles of Incorporation or these By-laws notice is required
to be given to any shareholder or director, it shall not be
construed to mean personal notice unless otherwise specifically
provided in the Articles of Incorporation or these By-laws, but
such notice may be given by mail, addressed to such shareholder
or director at his address as it appears on the records of the
Corporation, with postage thereon prepaid. Such notices shall be
deemed to have been given at the time they are deposited in the
United States mail. Notice to a director pursuant to Section 4.4
hereof may also be given personally or by telephone or telegram
sent to his or her address as it appears on the Corporation's
records.
7.2 Waiver. Whenever any notice is required to be given by
law, the Articles of Incorporation or these By-laws, a waiver
thereof in writing signed by the person or persons entitled to
said notice, whether before or after the time stated therein,
shall be deemed equivalent thereto. In addition, notice shall be
deemed to have been given to, or waived by, any shareholder or
director who attends a meeting of shareholders or directors in
person, or is represented at such meeting by proxy, without
protesting at the commencement of the meeting the transaction of
any business because the meeting is not lawfully called or
convened.
SECTION 8
OFFICERS
8.1 Designations. The Corporation's officers shall be a
Chairman, CEO and President (with all such offices to be held by
one person), a Secretary, an Executive Vice President and Chief
Operating Officer, a Chief Financial Officer and a Treasurer.
The Corporation may also have one or more Vice Presidents,
Assistant Secretaries and Assistant Treasurers. Any two offices
may be held by one person, provided that no person holding more
than one office may sign, in more than one capacity, any
certificate or other instrument required by law to be signed by
two officers.
8.2 Appointment of Certain Officers. At the first meeting
of each newly elected Board, or at such other time when there
shall be a vacancy, the Board shall elect a Chairman, CEO and
President, an Executive Vice President and Chief Operating
Officer, a Chief Financial Officer, a Secretary and a Treasurer,
each of whom shall serve for one year and until his or her
successor is elected and has qualified.
8.3 Appointment of Other Officers. As soon as practicable
after his or her election, the Chairman, CEO and President may
appoint one or more Vice Presidents, Assistant Secretaries and
Assistant Secretaries. The Chairman, CEO and President shall,
following such appointment or appointments, cause to be filed
with the minutes of the meeting of the Board an instrument
specifying the officers selected. The Chairman, CEO and
President may also appoint such other officers, employees and
agents of the Corporation as he or she may deem necessary, or may
vest the authority to appoint such other officers, employees and
agents in such other of the Corporation's officers as he or she
deems appropriate subject in all cases to his or her discretion.
Subject to these By-laws, all of the officers, employees and
agents of the Corporation shall hold their offices or positions
for such terms and shall exercise such powers and perform such
duties as shall be specified from time to time by the Board or
the Chairman, CEO and President.
8.4 Removal. The Board or the Chairman, CEO and President
may remove any officer with or without cause at any time. Any
such removal shall be without prejudice to the contractual rights
of such officers, if any, with the Corporation, but the election
of an officer shall not in and of itself create contractual
rights. Any vacancy occurring in any office of the Corporation
by death, resignation, removal or otherwise may be filled by the
Chairman, CEO and President until the next regular or special
meeting of the Board.
8.5 The Chairman, CEO and President. The Chairman, CEO and
President shall have general and active responsibility for the
management of the Corporation's business, shall be responsible
for implementing all orders and resolutions of the Board, shall
be the Corporation's chief operating officer, shall supervise the
daily operations of the Corporation's business and shall preside
at meetings of the Board and of the shareholders.
8.6 The Executive Vice President and Vice Presidents. The
Executive Vice President and the Vice Presidents in the order
specified by the Chairman, CEO and President or, if not so
specified, in the order of their seniority shall, in the absence
or disability of the Chairman, CEO and President, perform the
duties and exercise the powers of the President, and shall
perform such other duties as the Chairman, CEO and President
shall prescribe.
8.7 The Secretary. The Secretary shall attend all meetings
of the Board and all meetings of the shareholders, record all
votes and the minutes of all proceedings in a book to be kept for
that purpose, give, or cause to be given, notice of all meetings
of the shareholders and special meetings of the Board, and
perform such other duties as may be prescribed by the Board or
Chairman, CEO and President. The Secretary shall also keep in
safe custody the Corporation's seal, if any, and affix the seal
to any instrument requiring it.
8.8 The Executive Vice President and Chief Operating
Officer. The Executive Vice President and Chief Operating
Officer shall be the Corporation's principal operations officer
and shall manage the Corporation's operational affairs and direct
the activities of officers and other employees responsible for
engineering, quality assurance and materials, oil and gas and
technical services marketing, pilots, sector managers, domestic
operations, field maintenance (135 maint), and overhaul and
repair (145 maint). The Executive Vice President and Chief
Operating Officer shall also perform such other duties as may be
requested from time to time by the Board, the Chairman, CEO and
President, or the By-laws.
8.9 The Chief Financial Officer. The Chief Financial
Officer shall be the Corporation's principal financial officer
and shall manage the Corporation's financial affairs and direct
the activities of the Treasurer and other officers responsible
for the Corporation's financial affairs. The Chief Financial
Officer may sign, execute and deliver in the name of the
Corporation contracts, bonds and other obligations, shall be
responsible for all of the Corporation's internal and external
financial reporting and shall perform such other duties as may be
prescribed from time to time by the Board, the Chairman, CEO and
President or by the By-laws.
8.10 The Treasurer. As directed by the Chief Financial
Officer, the Treasurer shall have general custody of all funds
and securities of the Corporation. The Treasurer may sign, with
the Chairman, CEO and President, Chief Financial Officer or such
other person or persons as may be designated for the purpose by
the Board, all bills of exchange or promissory notes of the
Corporation. The Treasurer shall perform such other duties as
may be prescribed from time to time by the Chief Financial
Officer or the By-laws.
SECTION 9
STOCK
9.1 Certificates. Every holder of stock in the Corporation
shall be entitled to have a certificate signed by the President
or a Vice President and the Secretary or an Assistant Secretary
evidencing the number and class (and series, if any) of shares
owned by him, containing such information as required by law and
bearing the seal of the Corporation. If any stock certificate is
manually signed by a transfer agent or registrar other than the
Corporation itself or an employee of the Corporation, the signa-
ture of any such officer may be a facsimile. In case any officer,
transfer agent or registrar who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to
be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the Corporation with
the same effect as if he were such officer, transfer agent or
registrar at the date of issue.
9.2 Missing Certificates. The President or any Vice
President may direct a new certificate or certificates to be
issued in place of any certificate or certificates theretofore
issued by the Corporation alleged to have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the
person claiming the certificate of stock to be lost, stolen or
destroyed. As a condition precedent to the issuance of a new
certificate or certificates, the officers of the Corporation
shall, unless dispensed with by the President, require the owner
of such lost, stolen or destroyed certificate or certificates, or
his legal representative, (i) to advertise or give the
Corporation a bond or (ii) enter into a written indemnity
agreement, in each case in an amount appropriate to indemnify the
Corporation against any claim that may be made against the
Corporation with respect to the certificate alleged to have been
lost, stolen or destroyed.
9.3 Transfers. Upon surrender to the Corporation or the
transfer agent of the Corporation, of a certificate for shares
duly endorsed or accompanied by proper evidence of succession,
assignment or authority to transfer, it shall be the duty of the
Corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction
upon its books.
SECTION 10
DETERMINATION OF SHAREHOLDERS
10.1 Record Date. For the purpose of determining share-
holders entitled to notice of and to vote at a meeting, or to
receive a dividend, or to receive or exercise subscription or
other rights, or to participate in a reclassification of stock,
or in order to make a determination of shareholders for any other
proper purpose, the Board may fix in advance a record date for
determination of shareholders for such purpose, such date to be
not more than sixty days and, if fixed for the purpose of
determining shareholders entitled to notice of and to vote at a
meeting, not less than ten days, prior to the date on which the
action requiring the determination of shareholder is to be taken.
10.2 Registered Shareholders. Except as otherwise provided
by law, the Corporation, and its directors, officers and agents
may recognize and treat a person registered on its records as the
owner of shares, as the owner in fact thereof for all purposes,
and as the person exclusively entitled to have and to exercise
all rights and privileges incident to the ownership of such
shares, and rights under this Section 10.2 shall not be affected
by any actual constructive notice that the Corporation, or any of
its directors, officers or agents, may have to the contrary.
SECTION 11
MISCELLANEOUS
11.1 Dividends. Except as otherwise provided by law or the
Articles of Incorporation, dividends upon the stock of the
Corporation may be declared by the Board at any regular or
special meeting. Dividends may be paid in cash, property, or in
shares of stock.
11.2 Checks. All checks or demands for money and notes of
the Corporation shall be signed by such officer or officers or
such other person or persons as the Chairman, CEO and President
or the Board may from time to time designate. Signatures of the
authorized signatories may be by facsimile.
11.3 Fiscal Year. The Board may adopt for and on behalf of
the Corporation a fiscal or a calendar year.
11.4 Seal. The Board may adopt a corporate seal, which seal
shall have inscribed thereon the name of the Corporation. The
seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise. Failure to
affix the seal shall not, however, affect the validity of any
instrument.
11.5 Gender. All pronouns and variations thereof used in
these By-laws shall be deemed to refer to the masculine, feminine
or neuter gender, singular or plural, as the identity of the
person, persons, entity or entities referred to require.
SECTION 12
INDEMNIFICATION
The Corporation shall indemnify to the full extent permitted
by law any director, officer or employee against any expenses or
costs, including attorneys' fees, actually or reasonably incurred
by him or her in connection with any threatened, pending or
completed claim, action, suit or proceeding, whether criminal,
civil, administrative or investigative, against such person or as
to which he or she is involved solely as a witness or person
required to give evidence because he or she is a director,
officer or employee of the Corporation or serves or served at the
request of the Corporation with any other enterprise as a
director, officer or employee. For purposes of this Section 12,
the term "Corporation" shall include any predecessor of this
Corporation and any constituent corporation (including any
constituent of a constituent) absorbed by the Corporation in a
consolidation or merger; the term "other enterprises" shall
include any corporation, partnership, joint venture, trust or
employee benefit plan; service "at the request of the
Corporation" shall include service as a director, officer or
employee of the Corporation that imposes duties on, or involves
services by, such director, officer or employee with respect to
an employee benefit plan, its participants or beneficiaries; any
excise taxes assessed on a person with respect to an employee
benefit plan shall be deemed to be indemnifiable expenses; and
action by a person with respect to an employee benefit plan that
such person reasonably believes to be in the interest of the
participants and beneficiaries of such plan shall be deemed to be
action not opposed to the best interests of the Corporation.
SECTION 13
AMENDMENTS
The Corporation's By-laws may be amended or repealed only by
a majority of the Board or the affirmative vote of the holders of
at least a majority of the voting power present at any regular or
special meeting of shareholders, the notice of which states that
the proposed amendment or repeal is to be considered at the
meeting.
COR\19907.3
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION FROM CONDENSED FINANCIAL
STATEMENTS FOR THE PERIOD ENDED JULY 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> APR-30-1997
<PERIOD-END> JUL-31-1996
<CASH> 2,384
<SECURITIES> 0
<RECEIVABLES> 33,687
<ALLOWANCES> 0
<INVENTORY> 27,098
<CURRENT-ASSETS> 65,049
<PP&E> 224,313
<DEPRECIATION> 118,477
<TOTAL-ASSETS> 176,948
<CURRENT-LIABILITIES> 32,119
<BONDS> 0
0
0
<COMMON> 507
<OTHER-SE> 82,940
<TOTAL-LIABILITY-AND-EQUITY> 176,948
<SALES> 50,240
<TOTAL-REVENUES> 50,273
<CGS> 42,403
<TOTAL-COSTS> 45,545
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 867
<INCOME-PRETAX> 3,861
<INCOME-TAX> 1,583
<INCOME-CONTINUING> 2,278
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,278
<EPS-PRIMARY> 0.45
<EPS-DILUTED> 0.45
</TABLE>
