v3.5.0.2

Condensed Consolidating Financial Information

6 Months Ended

Jun. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Condensed Consolidating Financial Information

13. CONDENSED CONSOLIDATING FINANCIAL INFORMATION

As discussed further in Note 5, on March 17, 2014, PHI, Inc. issued $500.0 million of 5.25% Senior Notes due 2019 that are fully and unconditionally guaranteed on a joint and several, senior basis by all of our domestic subsidiaries. PHI, Inc. directly or indirectly owns 100% of all of its domestic subsidiaries.

The supplemental condensed financial information on the following pages sets forth, on a consolidated basis, the balance sheet, statement of operations, statement of comprehensive income, and statement of cash flows information for PHI, Inc. (“Parent Company”) and the guarantor subsidiaries under separate headings. The eliminating entries eliminate investments in subsidiaries, intercompany balances, and intercompany revenues and expenses. The condensed consolidating financial statements have been prepared on the same basis as the consolidated financial statements of PHI, Inc. The equity method is followed by the parent company within the financial information presented below.

The transactions reflected in “Due to/from affiliates, net” in the following condensed consolidated statements of cash flows primarily consist of centralized cash management activities between PHI, Inc. and its subsidiaries, pursuant to which cash earned by the guarantor subsidiaries is regularly transferred to PHI, Inc. to be centrally managed. Because these balances are treated as short-term borrowings of the Parent Company, serve as a financing and cash management tool to meet our short-term operating needs, turn over quickly and are payable to the guarantor subsidiaries on demand, we present borrowings and repayments with our affiliates on a net basis within the condensed consolidating statement of cash flows. Net receivables from our affiliates are considered advances and net payables to our affiliates are considered borrowings, and both changes are presented as financing activities in the following condensed consolidating statements of cash flows.

PHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEETS

(Thousands of dollars)

(Unaudited)

		June 30, 2016
		Parent
		Company				Guarantor
		Only (issuer)				Subsidiaries (1)				Eliminations				Consolidated
ASSETS
Current Assets:
Cash		$	40			$	8,527			$	—			$	8,567
Short-term investments			289,235				—				—				289,235
Accounts receivable – net			64,631				83,781				—				148,412
Intercompany receivable			—				47,588				(47,588	)			—
Inventories of spare parts – net			60,768				8,656				—				69,424
Prepaid expenses			4,821				2,981				—				7,802
Deferred income taxes			10,379				—				—				10,379
Income taxes receivable			950				(241	)			—				709
Total current assets			430,824				151,292				(47,588	)			534,528
Investment in subsidiaries			343,068				—				(343,068	)			—
Property and equipment – net			598,361				294,874				—				893,235
Restricted investments			13,023				15				—				13,038
Other assets			5,191				1,126				—				6,317
Total assets		$	1,390,467			$	447,307			$	(390,656	)		$	1,447,118
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable		$	16,742			$	6,720			$	—			$	23,462
Accrued and other current liabilities			28,825				11,518				—				40,343
Intercompany payable			47,588				—				(47,588	)			—
Total current liabilities			93,155				18,238				(47,588	)			63,805
Long-term debt:
Revolving credit facility			95,000				—				—				95,000
Senior Notes dated March 17, 2014, net of debt issuance costs of $3,376			496,624				—				—				496,624
Deferred income taxes and other long-term liabilities			80,342				86,001				—				166,343
Shareholders’ Equity:
Common stock and paid-in capital			308,835				79,191				(79,191	)			308,835
Accumulated other comprehensive income			45				—				—				45
Retained earnings			316,466				263,877				(263,877	)			316,466
Total shareholders’ equity			625,346				343,068				(343,068	)			625,346
Total liabilities and shareholders’ equity		$	1,390,467			$	447,307			$	(390,656	)		$	1,447,118

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors subsidiaries’ amounts.

PHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEETS

(Thousands of dollars)

(Unaudited)

		December 31, 2015
		Parent
		Company				Guarantor
		Only (issuer)				Subsidiaries (1)				Eliminations				Consolidated
ASSETS
Current Assets:
Cash		$	46			$	2,361			$	—			$	2,407
Short-term investments			284,523				—				—				284,523
Accounts receivable – net			70,336				74,442				—				144,778
Intercompany receivable			—				90,943				(90,943	)			—
Inventories of spare parts – net			60,060				9,431				—				69,491
Prepaid expenses			7,162				1,789				—				8,951
Deferred income taxes			10,379				—				—				10,379
Income taxes receivable			1,002				(241	)			—				761
Total current assets			433,508				178,725				(90,943	)			521,290
Investment in subsidiaries			330,848				—				(330,848	)			—
Property and equipment – net			632,759				250,770				—				883,529
Restricted investments			15,336				—				—				15,336
Other assets			5,975				203				—				6,178
Total assets		$	1,418,426			$	429,698			$	(421,791	)		$	1,426,333
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable		$	25,512			$	5,861			$	—			$	31,373
Accrued liabilities			29,138				15,621				—				44,759
Intercompany payable			90,943				—				(90,943	)			—
Total current liabilities			145,593				21,482				(90,943	)			76,132
Long-term debt:
Revolving credit facility			57,500				—				—				57,500
Senior Notes dated March 17, 2014, net of debt issuance costs of $3,999			496,001				—				—				496,001
Deferred income taxes and other long-term liabilities			92,334				77,368				—				169,702
Shareholders’ Equity:
Common stock and paid-in capital			306,444				79,061				(79,061	)			306,444
Accumulated other comprehensive loss			(567	)			—				—				(567	)
Retained earnings			321,121				251,787				(251,787	)			321,121
Total shareholders’ equity			626,998				330,848				(330,848	)			626,998
Total liabilities and shareholders’ equity		$	1,418,426			$	429,698			$	(421,791	)		$	1,426,333

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantor subsidiaries’ amounts.

PHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

(Thousands of dollars)

(Unaudited)

		For the quarter ended June 30, 2016
		Parent
		Company				Guarantor
		Only				Subsidiaries (1)				Eliminations				Consolidated
Operating revenues, net		$	89,365			$	77,771			$	—			$	167,136
Expenses:
Direct expenses			89,535				62,882				—				152,417
Selling, general and administrative expenses			9,232				2,871				(325	)			11,778
Total operating expenses			98,767				65,753				(325	)			164,195
Gain on disposal of assets, net			(4,298	)			—				—				(4,298	)
Equity in loss of unconsolidated affiliate			76				—				—				76
Operating income			(5,180	)			12,018				325				7,163
Equity in net income of consolidated subsidiaries			(7,035	)			—				7,035				—
Interest expense			7,534				6				—				7,540
Other income, net			(819	)			—				325				(494	)
			(320	)			6				7,360				7,046
(Loss) earnings before income taxes			(4,860	)			12,012				(7,035	)			117
Income tax (benefit) expense			(9,137	)			4,977				—				(4,160	)
Net earnings		$	4,277			$	7,035			$	(7,035	)		$	4,277
		For the quarter ended June 30, 2015
		Parent
		Company				Guarantor
		Only				Subsidiaries (1)				Eliminations				Consolidated
Operating revenues, net		$	115,040			$	83,507			$	—			$	198,547
Expenses:
Direct expenses			103,483				65,349				(4	)			168,828
Selling, general and administrative expenses			9,471				2,576				—				12,047
Total operating expenses			112,954				67,925				(4	)			180,875
Gain on disposal of assets, net			(66	)			—				—				(66	)
Equity in loss of unconsolidated affiliate			106				—				—				106
Operating income			2,046				15,582				4				17,632
Equity in net income of consolidated subsidiaries			(9,230	)			—				9,230				—
Interest expense			7,155				—				—				7,155
Other income, net			(571	)			—				4				(567	)
			(2,646	)			—				9,234				6,588
Earnings before income taxes			4,692				15,582				(9,230	)			11,044
Income tax (benefit) expense			(1,762	)			6,352				—				4,590
Net earnings		$	6,454			$	9,230			$	(9,230	)		$	6,454

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.

PHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

(Thousands of dollars)

(Unaudited)

		For the six months ended June 30, 2016
		Parent
		Company				Guarantor
		Only				Subsidiaries (1)				Eliminations				Consolidated
Operating revenues, net		$	181,234			$	149,918			$	—			$	331,152
Expenses:
Direct expenses			181,572				123,399				—				304,971
Selling, general and administrative expenses			18,275				5,674				(498	)			23,451
Total operating expenses			199,847				129,073				(498	)			328,422
Gain on disposal of assets, net			(3,939	)			—				—				(3,939	)
Equity in loss of unconsolidated affiliate			76				—				—				76
Operating income			(14,750	)			20,845				498				6,593
Equity in net income of consolidated subsidiaries			(12,090	)			—				12,090				—
Interest expense			15,047				26				—				15,073
Other income, net			(1,603	)			(4	)			498				(1,109	)
			1,354				22				12,588				13,964
(Loss) earnings before income taxes			(16,104	)			20,823				(12,090	)			(7,371	)
Income tax (benefit) expense			(11,449	)			8,733				—				(2,716	)
Net (loss)earnings		$	(4,655	)		$	12,090			$	(12,090	)		$	(4,655	)
		For the six months ended June 30, 2015
		Parent
		Company				Guarantor
		Only				Subsidiaries (1)				Eliminations				Consolidated
Operating revenues, net		$	243,697			$	159,047			$	—			$	402,744
Expenses:
Direct expenses			209,965				128,079				(9	)			338,035
Selling, general and administrative expenses			17,979				5,305				—				23,284
Total operating expenses			227,944				133,384				(9	)			361,319
Gain on disposal of assets, net			(73	)			—				—				(73	)
Equity in loss of unconsolidated affiliate			174				—				—				174
Operating income			15,652				25,663				9				41,324
Equity in net income of consolidated subsidiaries			(15,362	)			—				15,362				—
Interest expense			14,325				—				—				14,325
Other income, net			(1,034	)			(4	)			9				(1,029	)
			(2,071	)			(4	)			15,371				13,296
Earnings before income taxes			17,723				25,667				(15,362	)			28,028
Income tax expense			906				10,305				—				11,211
Net earnings		$	16,817			$	15,362			$	(15,362	)		$	16,817

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.

PHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

(Thousands of dollars)

(Unaudited)

		For the quarter ended June 30, 2016
		Parent
		Company				Guarantor
		Only				Subsidiaries (1)				Eliminations				Consolidated
Net earnings		$	4,277			$	7,035			$	(7,035	)		$	4,277
Unrealized loss on short-term investments			210				—				—				210
Changes in pension plan assets and benefit obligations			1				—				—				1
Tax effect			(75	)			—				—				(75	)
Total comprehensive income		$	4,413			$	7,035			$	(7,035	)		$	4,413
		For the quarter ended June 30, 2015
		Parent
		Company				Guarantor
		Only				Subsidiaries (1)				Eliminations				Consolidated
Net earnings		$	6,454			$	9,230			$	(9,230	)		$	6,454
Unrealized loss on short-term investments			(158	)			—				—				(158	)
Tax effect			63				—				—				63
Total comprehensive income		$	6,359			$	9,230			$	(9,230	)		$	6,359

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.

PHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Thousands of dollars)

(Unaudited)

		For the six months ended June 30, 2016
		Parent
		Company				Guarantor
		Only				Subsidiaries (1)				Eliminations				Consolidated
Net (loss) earnings		$	(4,655	)		$	12,090			$	(12,090	)		$	(4,655	)
Unrealized loss on short-term investments			1,017				—				—				1,017
Changes in pension plan assets and benefit obligations			2				—				—				2
Tax effect			(407	)			—				—				(407	)
Total comprehensive (loss) income		$	(4,043	)		$	12,090			$	(12,090	)		$	(4,043	)
		For the six months ended June 30, 2015
		Parent
		Company				Guarantor
		Only				Subsidiaries (1)				Eliminations				Consolidated
Net earnings		$	16,817			$	15,362			$	(15,362	)		$	16,817
Unrealized loss on short-term investments			(19	)			—				—				(19	)
Unrealized realized gain			24				—				—				24
Tax effect			9				—				—				9
Total comprehensive income		$	16,831			$	15,362			$	(15,362	)		$	16,831

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors’ subsidiaries amounts.

PHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(Thousands of dollars)

(Unaudited)

		For the six months ended June 30, 2016
		Parent
		Company				Guarantor
		Only (issuer)				Subsidiaries (1)				Eliminations				Consolidated
Net cash (used in) provided by operating activities		$	(12,954	)		$	13,753			$	—			$	799
Investing activities:
Purchase of property and equipment			(39,535	)			(373	)			—				(39,908	)
Proceeds from asset dispositions			10,998				—				—				10,998
Purchase of short-term investments			(151,436	)			—				—				(151,436	)
Proceeds from sale of short-term investments			148,838				—				—				148,838
Payments of deposits on aircraft			(131	)			—				—				(131	)
Net cash used in investing activities			(31,266	)			(373	)			—				(31,639	)
Financing activities:
Proceeds from line of credit			150,800				—				—				150,800
Payments on line of credit			(113,300	)			—				—				(113,300	)
Repurchase of common stock			(500	)			—				—				(500	)
Due to/from affiliate, net			7,214				(7,214	)			—				—
Net cash provided by (used in) financing activities			44,214				(7,214	)			—				37,000
(Decrease ) increase in cash			(6	)			6,166				—				6,160
Cash, beginning of period			46				2,361				—				2,407
Cash, end of period		$	40			$	8,527			$	—			$	8,567

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors subsidiaries’ amounts.

PHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(Thousands of dollars)

(Unaudited)

		For the six months ended June 30, 2015
		Parent
		Company				Guarantor
		Only (issuer)				Subsidiaries (1)				Eliminations				Consolidated
Net cash provided by operating activities		$	46,696			$	22,612			$	—			$	69,308
Investing activities:
Purchase of property and equipment			(29,502	)			—				—				(29,502	)
Proceeds from asset dispositions			567				—				—				567
Purchase of short-term investments			(290,469	)			—				—				(290,469	)
Proceeds from sale of short-term investments			257,454				—				—				257,454
Payments of deposits on aircraft			(131	)			—				—				(131	)
Net cash used in investing activities			(62,081	)			—				—				(62,081	)
Financing activities:
Proceeds from line of credit			119,740				—				—				119,740
Payments on line of credit			(127,240	)			—				—				(127,240	)
Repurchase of common stock for payroll tax withholding requirements			(2,338	)			—				—				(2,338	)
Due to/from affiliate, net			25,220				(25,220	)			—				—
Net cash provided by (used in) financing activities			15,382				(25,220	)			—				(9,838	)
Decrease in cash			(3	)			(2,608	)			—				(2,611	)
Cash, beginning of period			51				6,219				—				6,270
Cash, end of period		$	48			$	3,611			$	—			$	3,659

(1) Foreign subsidiaries represent minor subsidiaries and are included in the guarantors subsidiaries’ amounts.

X

- Definition

The entire disclosure for condensed financial statements.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 3
-Subparagraph (SX 210.12-04)
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e24072-122690

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 810
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=64809438&loc=d3e5614-111684

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.10-01(a))
-URI http://asc.fasb.org/extlink&oid=27015980&loc=d3e46468-122699

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- References

No definition available.

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