What Bristow Group (VTOL) Said on Its Q3 Earnings Call

Key Points

• Bristow reaffirmed its 2026 adjusted EBITDA guidance midpoint at about $310 million, implying roughly 25% growth year over year, with stronger offshore energy performance helping offset government-services pressures.
• Offshore energy margins improved to 27%, and the company raised and narrowed that segment’s full-year adjusted operating income guidance to $240 million–$250 million. Government services remain challenged by parts shortages, aircraft-modification delays and penalties; Bristow expects supply conditions to stabilize by the end of Q1 2027.
• Bristow Special Missions, acquired in July, is performing as expected, with its cargo operation exceeding expectations. During the quarter, Bristow also repurchased $25 million of shares and declared a $0.125-per-share dividend.

Bristow Group NYSE: VTOL reaffirmed the midpoint of its 2026 adjusted EBITDA guidance at approximately $310 million, as stronger offshore energy operations helped offset supply chain costs and contract transition delays in its government services business.

On its third-quarter earnings call, CEO Chris Bradshaw said the midpoint implies approximately 25% growth from the prior year. Total revenue rose by about $26 million from the second quarter, while adjusted EBITDA increased by approximately $10 million, CFO Jennifer Whalen said. The company did not provide consolidated third-quarter totals for either measure on the call.

Results included the contribution of Bristow Special Missions, formerly Berry Aviation, from July 13 following the acquisition. Bradshaw said the business had performed well since the deal closed and that he expected its growth to accelerate in the fourth quarter and in 2027.

Offshore Strength Offsets Government Pressure

Bristow raised and narrowed its full-year adjusted operating income guidance for offshore energy services to $240 million to $250 million. Revenue in the segment fell $5.6 million sequentially, primarily because of lower utilization in Europe and higher penalties in Africa, but adjusted operating income rose $2 million as expenses declined.

The segment’s adjusted operating income margin reached 27% in the third quarter, compared with margins in the low teens when Bristow began resetting contracts toward the end of 2023, Whalen said. She attributed the improvement partly to lower costs in the North Sea and contract resets and growth in markets including the Americas and Africa. The full-year impact of more recent rate adjustments is expected in 2027.

Bradshaw said tight helicopter supply and offshore energy fundamentals have created the most favorable industry conditions the company has seen in more than a dozen years. Roughly 85% of Bristow’s offshore energy revenue supports long-term production activities, he said, while additional drilling can also increase demand for helicopter services.

Government services faced a different set of pressures. Bristow updated its 2026 guidance for that segment to revenue of $470 million to $490 million and adjusted operating income of $35 million to $45 million. Whalen said aircraft availability penalties remained elevated, although penalties on the U.K. search-and-rescue contract declined during the quarter.

Government services revenue rose $17.8 million sequentially, including $16.9 million contributed by the acquired special missions business. Segment adjusted operating income increased $2.5 million, as the acquisition’s contribution was partly offset by higher expenses associated with the acquired business and ongoing contract transitions.

Parts Shortages Delay Aircraft Work

Bradshaw said the most acute supply chain effects have been delays to aircraft modification programs for new search-and-rescue contracts. Beyond contractual penalties, he cited lost revenue opportunities, delayed aircraft lease returns, extra staffing and overtime, outsourced maintenance and the use of parts from Bristow’s own fleet to keep other aircraft flying.

In response, the company has increased inventory, retained additional staff and added a second shift at the hangar handling modifications. Bradshaw said Bristow also obtained a cap on certain government contract performance penalties that it expects to remain in place at least through the first quarter of 2027.

Aftermarket parts availability is a much larger problem than delays in new aircraft deliveries, Bradshaw told analysts. He said the most affected aircraft are primarily Leonardo models, including AW189 helicopters used for the Irish Coast Guard contract and the U.K. search-and-rescue program.

Following discussions with suppliers, Bradshaw said the company’s best information was that the situation should be more stable by the end of the first quarter of 2027. Whalen cautioned that some transition costs will extend into early 2027 and said government search-and-rescue margins are expected to recover over time.

Acquisition and Capital Returns

Whalen said Bristow Special Missions was on track to perform as expected in 2026, with back-office integration progressing without meaningful issues. Bradshaw said the acquired business’s on-demand cargo operation was performing above expectations. He also identified potential growth in intelligence, surveillance and reconnaissance missions and troop movements if additional aircraft capital is available.

Bristow used approximately $103 million in net cash for the acquisition during the quarter, subject to purchase price adjustments. It also repurchased 550,000 shares for $25 million, at an average price of $45.64, leaving $96 million available under its repurchase program. The company declared a dividend of $0.125 per share on October 29, payable November 27 to shareholders of record on November 13.

As of September 2026, Bristow had $233.4 million in unrestricted cash and approximately $287 million in total available liquidity. Whalen said the company also plans to implement a new enterprise resource planning system, expected to go live in 2028 and generate recurring savings of several million dollars a year once fully in place. She said it was too early to quantify the implementation cost.

About Bristow Group (NYSE:VTOL)

Bristow Group Inc NYSE: VTOL is a provider of aviation services, specializing in helicopter transportation and support for the offshore energy industry, government agencies and other commercial customers. The company operates helicopters and fixed-wing aircraft to transport personnel and equipment, support offshore installations and provide specialized aviation services.

Bristow's government services include search-and-rescue operations, emergency response and aviation support conducted under long-term contracts.

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