Bristow Holds 2026 EBITDA Outlook at About $310 Million

By Amara Osei

About $310 million is the reaffirmed 2026 adjusted EBITDA guidance midpoint for Bristow Group (NYSE: VTOL), roughly 25% above the prior year, as stronger offshore energy operations offset supply-chain costs and government contract-transition delays, supporting the group’s growth outlook.

CEO Chris Bradshaw discussed the midpoint on the third-quarter earnings call. Total revenue rose about $26 million from the second quarter, while adjusted EBITDA increased about $10 million, CFO Jennifer Whalen said. The company did not provide consolidated third-quarter totals for either measure on the call.

Results include 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 expected its growth to accelerate in the fourth quarter and in 2027.

How did offshore operations lift results?

Bristow raised and narrowed its full-year 2026 adjusted operating income guidance for offshore energy services to $240 million to $250 million. Third-quarter segment revenue fell $5.6 million from the second quarter, mainly on lower utilization in Europe and higher penalties in Africa. Adjusted operating income nevertheless rose $2 million as expenses declined.

Whalen said the segment’s adjusted operating income margin reached 27%, compared with the low teens when Bristow began resetting contracts toward the end of 2023. Lower North Sea costs, contract resets and growth in the Americas and Africa drove part of the improvement. Bristow expects the full-year effect of more recent rate adjustments in 2027.

Bradshaw said tight helicopter supply and offshore energy fundamentals had created the company’s most favorable industry conditions in more than 12 years. Roughly 85% of offshore revenue supports long-term production activities, he said, while additional drilling can also increase helicopter demand.

Offshore strength is offsetting government-service costs, and the next contract resets will shape 2027 earnings.

Why are government services under pressure?

Bristow updated its 2026 government-services guidance 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 from the second quarter, including $16.9 million contributed by the acquired Special Missions business. Segment adjusted operating income increased $2.5 million, as the acquisition contribution was partly offset by higher expenses associated with the acquired operation and ongoing contract transitions.

The supply chain’s sharpest effects are delays to aircraft modification programs for new search-and-rescue contracts. Bradshaw said the consequences extend beyond contractual penalties to lost revenue opportunities, delayed aircraft lease returns, extra staffing and overtime, outsourced maintenance and use of parts from Bristow’s own fleet to keep other aircraft flying.

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

Higher transition expenses are holding back government margins even as acquired revenue and offshore performance improve the group.

When will the parts shortage ease?

Aftermarket parts availability poses a bigger problem than delays in delivering new aircraft, Bradshaw told analysts. 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 indicated that the situation should become more stable by the end of the first quarter of 2027.

Whalen cautioned that some transition costs will continue into early 2027. She said government search-and-rescue margins should recover over time.

Parts normalization should relieve operating pressure, but transition costs will still run into early 2027.

What did the acquisition and capital returns deliver?

Whalen said Bristow Special Missions remained on track to perform as expected in 2026, with back-office integration progressing without meaningful issues. Bradshaw said its 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 becomes available.

Bristow used about $103 million in net cash for the acquisition during the quarter, subject to purchase-price adjustments. It 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 held $233.4 million in unrestricted cash and approximately $287 million in total available liquidity.

Whalen said Bristow plans a new enterprise resource planning system that it expects to go live in 2028. The system should generate recurring savings of several million dollars annually once fully implemented, but she said it was too early to quantify the implementation cost.

Bristow provides helicopter transportation and support for offshore energy companies, government agencies and other commercial customers. Its fleet of helicopters and fixed-wing aircraft carries personnel and equipment, supports offshore installations and provides specialized aviation services. Government work includes search-and-rescue operations, emergency response and aviation support under long-term contracts.

Liquidity remains substantial, while the acquisition, buyback and dividend put cash use and operating repair on the same agenda.