Some other holdings in the portfolio underperformed. Helicopter transport company supplier Bristow Group Inc. (NYSE:BRS) declined -49.19% as continued oil price weakness and disappointing earnings weighed heavily on the stock. The company’s management team lowered guidance around profitability and accelerated necessary cost cutting. Despite this short-term weakness, management reiterated that it expected to see stronger results in the second half of the fiscal year as recent contract wins come online. Management also reaffirmed the firm’s commitment to maintaining total liquidity over $200 million, highlighting the successful renegotiation of the company’s short-term debt obligations late last year. We expect to see continued short-term volatility in the company’s quarterly earnings reports. While we recognize the company faces several headwinds, we do not believe it is facing any significant risk of insolvency. Continued weakness in the energy market will be a headwind to the company short-term. However, we believe the value of the helicopters that Bristow owns creates a potential margin of safety1, as the company’s assets exceed its current stock price.
- From John Rogers (Trades, Portfolio)' Ariel Fund second quarter 2015 shareholder letter.
