What the HEC?! – Human External Cargo
What the HEC?! – Human External Cargo Winching (or hoisting), used for Search & Rescue (SAR) or for personnel transfer to and from otherwise difficult to access locations, is the most widely known form of what is known as Human External Cargo. Some operators however transfer personnel by harnesses on long-lines. Here Southern California Edison (SCE), a subsidiary of Edison International, a public utility based in Rosemead, California, use a twin engine Airbus Helicopters EC135 (H135) to transfer power transmission linesman to pylons in remote locations. https://www.youtube.com/watch?v=Wm4vPZvHS68&feature=player_embedded The company say that: … linemen recently attached GoPro cameras to their helmets and took flight to replace aging insulators on a transmission line near Corona, California. The towers traverse the Santa Ana Mountains and help carry electricity from Menifee to Anaheim. Before taking flight, the entire crew and helicopter pilots met for a tailboard, or safety discussion, to go over specifics of the day’s work. They discuss potential hazards, the weather forecast and the nearest hospital in case of an emergency. After the tailboard, each crew member checks their own harness to make sure it’s ready for flight. They then do a buddy check on another lineman to be extra safe. Eight linemen were assigned to the job and paired up for the two-minute flight. The crew was flown up to the tower, followed by their equipment and new insulators. SCE took delivery of the EC135 in 2008 and has a fleet of six helicopters of various types based at the utility’s Chino Airport location. An article published in 2012 describes the history of the HEC operation, the equipment and training. They have recently added their first medium helicopter, a Bell 205 for under slung cargo work. The company also construct pylons with chartered helicopters using under slung load techniques similar to ones Aerossurance has discussed recently. They also contract for wire slinging operations. Also see our articles: Keep Your Eyes on the Hook! Underslung External Load Safety, Helicopter Underslung Load: TV Transmitter and French Skyscraper: Helicopter Underslung Load UPDATE 9 December 2015: Aerossurance’s friends in South Africa have shared with us this video, which we suspect is from the 1990s, of power line work for ESKOM in SA. UPDATE 5 February 2017: Our new article Fatal Low Altitude Hover Power Loss: Power Line Maintenance Project looks at how an engine compressor failure while installing power line markers resulted in an unsurvivable impact and fire. See our article The Tender Trap on procuring aviation services UPDATE 22 March 2017: RTE-STH, the helicopter division of French public utility company RTE, has commissioned Airbus Helicopters’ UK to deliver a power line maintenance customisation kit for its H135s. The EASA-certified kit, comprising aircraft modifications and the development of seven baskets and bespoke attachment devices, will allow RTE engineers direct access to carry out essential maintenance work on live power line cables. Initial flight testing is now under way and delivery is expected in 2018. UPDATE 27 December 2019: Fatal Powerline Human External Cargo Flight Aerossurance has extensive helicopter operations, safety, regulation and contracting experience. For practical aviation advice you can trust, contact us at: enquiries@aerossurance.com Follow us on LinkedIn and on Twitter @Aerossurance for our latest...
read moreCrashworthiness and a Fiery Frisco US HEMS Accident
Crashworthiness and a Fiery Frisco US HEMS Accident (Airbus Helicopters AS350B3e, N390LG of Air Methods) Shortly after take-off from a hospital in Frisco, Colorado, on 2 July 2015, Airbus Helicopters AS350B3e helicopter, N390LG, operated by Air Methods as ‘Flight for Life’, crashed in a parking lot 120m away. This was a daytime, Visual Meteorological Condition (VMC), Part 135 flight. The US National Transportation Safety Board (NTSB) preliminary report stated: Multiple witnesses observed the helicopter lift off from the ground-based helipad, rotate counterclockwise, and climb simultaneously. One witness estimated that the helicopter reached an altitude of 100 feet before it started to descend. The helicopter continued to spin counterclockwise several times before it impacted a parking lot and an RV to the southwest of the Flight for Life hangar and helipad. The helicopter came to rest on its right side, was damaged by impact forces, and was charred, melted, and partially consumed by fire. UPDATE: Ultimately the NTSB Final Report was issued 27 March 2017. Below are a sequence of screen shots from security CCTV video shown by 9News who in an excellent piece of journalism have devoted much research to this topic: A small fire starts, but fuel pours out an soon ignites. 28 seconds after impact one of the medical personnel is seen to kick out a door and jumps clear, on fire and suffering from 90% burns. He is still in hospital after over 30 operations. Amazingly, the other manages to egress without significant injury. A member of staff bravely approaches the helicopter with a hand held extinguisher. Shortly after the pilot egresses the wreckage. He died later in hospital. The fire was brought under control by local fire departments. The aircraft was positioning for display at a Boy Scouts of America event. This was Air Methods’ second fatal air accident with a post crash fire in 4 months. That accident also involved a positioning flight. Air Methods, a large player in the HEMS business founded in 1980, has had 7 air accidents in the last 5 years according to the Aviation Safety Network (looking at their HEMS business only). Five were fatal accidents with 12 fatalities. Crash Resistant Fuel Systems Although this particular As350 was only about a year old, as a type the AS350 was certified prior to enhance certification requirements for a crash resistant fuel system (CRFS) introduced in 1994. When those were introduced, the Federal Aviation Administration (FAA) stated: A post-crash fire (PCF) is the number one cause of fatalities and injuries in an otherwise survivable impact resulting from a rotorcraft accident. It is estimated that annually 5 percent of the occupants in survivable rotorcraft accidents are killed or injured by a PCF. These types of fatalities and traumatic injuries would be substantially reduced by adopting the design and test criteria proposed in this notice. Nearly all PCF’s are caused by crash-induced fuel leaks that quickly come in contact with ignition sources during or after impact. Current FAA rotorcraft airworthiness standards do not comprehensively address minimizing fuel leaks and potential fuel ignition sources in order to maximize occupant escape time in a survivable crash. The fuel containment and hazard elimination provisions contained in these proposals would, in the majority of cases, give occupants the time necessary to escape a survivable crash before a PCF could become critical. A crash resistant fuel system, CRFS, would...
read moreMetro-North: Organisational Accidents and Shelfware
Metro-North: Organisational Accidents and Shelfware An NTSB study into five accidents on US railway (‘railroad’) Metro-North gives a unique perspective on organisational accidents. Metro-North was described as having an “invisible safety department”, that kept its SMS on the shelf until external audits and assumed on-time performance would give them safe operations. Organisational Accidents James Reason, Professor Emeritus, University of Manchester popularised the expression ‘organisational accident’ in his 1997 book Managing the Risks of Organizational Accidents. He used the term to differentiate simple ‘individual accidents’ involving just one person to complex accidents involving more people, organisations, technology and systems. Reason explained that: Organizational accidents have multiple causes involving many people operating at different levels of their respective companies. Such accidents result from ‘latent organisational failures’ that are like pathogens that have infected the organisation. In the earlier, 1995 book, Beyond Aviation Human Factors, Maurino, Reason, et al give examples: Lack of top-level management safety commitment or focus Conflicts between production and safety goals Poor planning, communications, monitoring, control or supervision Organizational deficiencies leading to blurred safety and administrative responsibilities Deficiencies in training Poor maintenance management or control Monitoring failures by regulatory or safety agencies This case study covers a host of these pathogens. We have also written previously on: James Reason’s 12 Principles of Error Management The Metro-North Accidents Metro-North is the second largest commuter railroad, and one of the busiest, in the United States. Between May 2013 and March 2014 Metro-North had five significant accidents resulting in 6 fatalities, 126 injuries and more than $28 million in damages. In November 2014 the US National Transportation Safety Board (NTSB) published a special investigation report into the organisational factors that emerged (discussed at a special hearing). This series of accidents is also covered in an excellent DisasterCast podcast by Drew Rae. Metro-North Safety Management Although not a regulatory requirement, the New York State Public Transportation Safety Board (PTSB), who conduct ‘safety oversight’ of organisations who receive State transportation grants, requires rail operators to maintain a and update it every 2 years. The American Public Transportation Association (APTA) have issued a manual on the creation of SSPPs. An SSPP is expected from participants in APTA’s voluntary safety management audit program. The NTSB report describes the SSPP as analogous to an SMS Manual in other industries. The Metro-North SSPP stated that it was created to: …coordinate a safety system for prevention, identification and management of hazards in an effort to minimize safety risks to both customers and employees. The SSPP also includes the statement that: Metro-North’s commitment to the SSPP will permeate every aspect of railroad operations. It is concerning that the commitment is to the plan, rather than to safety (i.e. to the means rather than to the ends). However, far worse the NTSB say: NTSB investigators found little evidence that Metro-North systematically followed…procedures as described in the SSPP. Moreover, the NTSB investigators found no evidence that Metro-North actually used the SSPP as part of is operational guidance. Aside from senior management personnel, most of the Metro-North employees interviewed by NTSB investigators stated that they had never heard of or seen copies of the SSPP. Even the organisation’s Chief Safety Officer candidly admitted: I don’t think it’s effective at all. …my whole 28 years here it was something that we reviewed when APTA and the FRA [the federal regulator the Federal Railroad Administration] came in to do their triennial...
read moreInadequately Secured Cargo Caused B747F Crash at Bagram, Afghanistan
Inadequately Secured Cargo Caused B747F Crash at Bagram, Afghanistan The US National Transportation Safety Board (NTSB) has determined that a National Airlines Boeing 747 Freighter N949CA that crashed on take-off on 29 April 2013 did so because the five armoured military vehicles (2x12t and 3x18t) on-board were inadequately restrained. As the NTSB explain: These vehicles were considered a special cargo load because they could not be placed in unit load devices (ULDs) and restrained…using the…main deck cargo handling system. Instead, the vehicles were secured to centerline-loaded floating pallets and restrained to the airplane’s main deck using tie-down straps. The rearmost vehicle moved rearward into the rear pressure bulkhead, crippling two hydraulic systems and damaging horizontal stabilizer components. This rendered the airplane uncontrollable. All seven crewmembers were killed in the accident on 29 April 2013 at Bagram, Kabul, Afghanistan. The aircraft was on charter to the US Air Mobility Command. As they describe in their press release, NTSB Finds Damage From Inadequately Secured Cargo Caused Boeing 747 Crash in Bagram, Afghanistan: Contributing to the accident was the Federal Aviation Administration’s inadequate oversight of National Airlines’ (NAL’s) handling of special cargo loads, such as that being carried on the accident flight. The Boeing 747-400 freighter was carrying five mine-resistant ambush-protected (MRAP) vehicles. There was no evidence found to suggest that the airplane was brought down by an explosive device or hostile acts. The investigation found that National Airlines’ cargo operations manual not only omitted critical information from Boeing and from the cargo handling system manufacturer about properly securing cargo, but it also contained incorrect restraining methods for special cargo loads. The Board recommended that the FAA create a certification process for personnel responsible for the loading, restraint, and documentation of special cargo loads on transport-category airplanes. Other recommendations call on the FAA to improve its ability to inspect cargo aircraft operations, specifically those involving special cargo loads. Three points that we thought noticeable during the Board Meeting and the staff presentations were: Boeing’s analysis was that loading of only one vehicle was permissible (and then one of the smaller vehicles) because of the space needed to fit longitudinal securing straps (see illustration below), and they would have used 60 straps not the 24 used by National. The loadmaster had been on duty for 21 hours at the time of the accident. The load had been found to have shifted during the short flight from Camp Bastion in Helmand province to Kabul for fuel. However, apart from retightening and adding just two more straps, it appears little was done before the next sector. To view the findings, and recommendations, click on the following link: http://go.usa.gov/3fHTS or by looking in the public docket. The National Transportation Safety Board determines that the probable cause of this accident was National Airlines’ inadequate procedures for restraining special cargo loads, which resulted in the loadmaster’s improper restraint of the cargo, which moved aft and damaged hydraulic systems Nos. 1 and 2 and horizontal stabilizer drive mechanism components, rendering the airplane uncontrollable. Contributing to the accident was the Federal Aviation Administration’s inadequate oversight of National Airlines’ handling of special cargo loads. The NTSB have now made the presentations and opening / closing remarks available: Opening Statement – Chairman Christopher A. Hart Opening Statement– Investigator in Charge Aircraft Structures Operational Issues Closing Statement – Chairman Christopher A. Hart UPDATE 22 July...
read moreA319 Double Cowling Loss and Fire – AAIB Report
A319 Double Cowling Loss and Fire – AAIB Report The UK Air Accidents Investigation Branch (AAIB) has published their report into an Airbus A319 that lost both engine fan cowlings and suffered an associated fire on take-off from London Heathrow in 2013. We look at the circumstances of the previous evening’s maintenance on this aircraft, which has lessons for other operators and maintenance organisations. In particular, we look at the maintenance human factors that resulted in the cowlings being left unlatched, including an aircraft ‘swap-error’ and maintainer fatigue / alertness. We had previous discussed the series of incidents with the A320 family cowlings and planned design improvements, in this article: Maintenance Human Factors: The Next Generation. The Accident At 07:16Z on 24 May 2013, British Airways A319 G-EUOE, powered by IAE V2500s, departed runway 27L at London Heathrow. At rotation, the fan cowl doors from both engines detached, damaging the airframe and puncturing a fuel pipe on the right-hand (or Number 2) engine. The flight crew observed: engine thrust control degradation, the loss of the yellow hydraulic system, and a significant fuel leak. They declared a PAN, with the intention of returning to Heathrow once they had fully assessed the situation using the T-DODAR (Time, Diagnose, Options, Decide, Act/Assign, Review) philosophy. During the approach to land on runway 27R, a fire developed on the right-hand engine and the crew declared a MAYDAY. Both engine fire extinguisher bottles were discharged and the right-hand engine was shut down (albeit without the normal crew cross-check). The intensity of the fire reduced but it did not abate. The other engine continued to perform normally. The aircraft landed safely at 07:45Z, coming to rest on the runway where the airport fire service extinguished a small fire on the right-hand engine. The 80 persons on board evacuated in 64 seconds without injury using the left-hand escape slides. There had been a short delay to evacuation however as the left-hand engines had been left running. The Investigation The AAIB determined that both engine fan cowlings had been left unlatched after maintenance the previous evening and this that was not spotted prior to take-off. The investigation identified the following causal factors: The technicians responsible for servicing the aircraft’s [Integrated Drive generators] IDGs did not comply with the applicable [Aircraft Maintenance Manual] AMM procedures, with the result that the fan cowl doors were left in an unlatched and unsafe condition following overnight maintenance. The pre-departure walk-around inspections by both the pushback tug driver and the co-pilot did not identify that the fan cowl doors on both engines were unlatched. The investigation identified the following contributory factors: The design of the fan cowl door latching system, in which the latches are positioned at the bottom of the engine nacelle in close proximity to the ground, increased the probability that unfastened latches would not be seen during the pre‑departure inspections. The lack of the majority of the high-visibility paint finish on the latch handles reduced the conspicuity of the unfastened latches. The decision by the technicians to engage the latch handle hooks prevented the latch handles from hanging down beneath the fan cowl doors as intended, further reducing the conspicuity of the unfastened latches. Maintenance Aspects – Introduction The AAIB report (both in the main body and Appendix 6, written by...
read moreUK CAA Helideck Developments
UK CAA Helideck Developments The UK Civil Aviation Authority (CAA) are considering changing how offshore helidecks are approved and assessing the fire-fighting provision on Normally Unattended Installations (NUIs). The former activity is subject to a public consultation and that latter is being examined by a Offshore Helicopter Safety Action Group (OHSAG) working group. Helideck Qualified Entities In the UK CAA’s review of offshore helicopter operations, CAP 1145, issued in February 2014, Action A13 in Chapter 14 was raised as the CAA had the intention to assume responsibility for the certification of UK helidecks (originally with a target of ‘delivery in Q1/2015’). The helidecks are currently inspected against CAP437 by the Helideck Certification Agency (HCA) who is contracted to do this by the UK operators. A consultation (based around proposals in CAP1295) is currently being undertaken. This consultation is open for public comments until 24 July 2015. CAP1295 describes how CAA could empower one or more Qualified Entities to act on behalf: The proposal would be for CAA to underwrite a qualified entity’s approvals system by issuing an operational directive under article 15 of the [Air Navigation Order] ANO (and article 6(4) of the Air Operations Regulation 965/2012) requiring helicopters operating to offshore installations and vessels on the UKCS only to do so if facilities have been approved /certificated by a Qualified Entity (or Entities) acting on behalf of the NAA (UK CAA). We predicted the CAA would consider the Qualified Entity approach, as used in the Unmanned Air System sector, a year ago. The CAA believe their proposals address ‘the perceived weaknesses of the present system’. In particular, by also providing a mechanism for grading non-compliances, which they describe as a ‘Helideck MEL’, backed by a: …legal directive whereby CAA (and their agent(s)) is [sic] empowered to prevent an operation should, in the opinion of the CAA and / or the qualified entity, the helideck fail to achieve a minimum level of compliance i.e. if it is deemed unsafe to continue operations. UPDATE 5 October 2015: The CAA have stated they received 20 responses: These responses are being used to assist in the determination of the next steps to address CAP 1145 Action item A13. It is anticipated that an update on progress will be communicated by the end of 2015. NUI Fire-fighting In April 2015, after the last OHSAG meeting, UK CAA also announced a set of proposals aimed at improving the safety of helicopter operations to the 116 NUIs on the UK Continental Shelf (UKCS). The CAA say they build upon an independent report commissioned by CAA in mid-2014 from Cranfield University, but not as yet made public by CAA. These CAA proposals effectively supersede Recommendations R8 and R9 in Chapter 10 of CAP1145 (which originally had a target of ‘delivery in Q3/2014’). The CAA say: These proposals will be taken forward on a very short timescale by a joint industry working group, featuring the CAA, helicopter operators, offshore industry and pilot union representatives. Health and Safety Executive has also been invited to participate. The work will focus on addressing the risk posed by fire following any incident involving a helicopter on the helideck of a normally unattended installation, where there may be no one on the rig to assist in fire suppression. The CAA say their proposals “either individually, or collectively, will meet the requirement to increase safety and survivability” and...
read moreDuPont Reputational Explosion
DuPont Reputational Explosion Chemical company DuPont (E.I. DuPont de Nemours & Co Inc.) has been feted for its safety performance for many years (for example winning the National Safety Council‘s 2013 Robert W. Campbell Award). Its reputation in the field of safety stretches back to the founding of the company as a gunpowder manufacturer in 1802. This is one that the company also exploits through a consultancy division selling safety and operational excellence services to other organisations. However, that reputation has been blasted by federal agencies after a series of fatal accidents. La Porte Accident On 15 November 2014, a worker was overcome at a DuPont chemical manufacturing facility in La Porte, Texas when a supply line unexpectedly released around 20 tonnes of methyl mercaptan. Three colleagues came to the worker’s aid but all four were asphyxiated by the flammable and highly toxic gas. The independent investigation into that accident is still on-going by the US Chemical Safety Board, but in February 2015 the CSB made an interim statement that identified serious process safety shortcomings: The process included several interconnections between the methyl mercaptan supply line and a chemical vent system, which allowed a toxic leak into an unexpected location… The chemical vent system…had a design shortcoming that allowed liquid to accumulate inside…The liquid needed to be manually drained by operators to prevent safety issues from interconnected equipment, such as reactors. …workers were exposed to whatever chemicals were drained from the vent system. The building was designed in such a way that even had ventilation fans been working on the day of the accident, it would likely not have effectively protected workers from chemical exposure. …those ventilation fans were not, in fact, working at the time of the accident. The Regulator’s Response Last week it was reported that: Just weeks after blasting DuPont for safety violations following a deadly chemical plant incident last November, federal regulators now say the chemical manufacturing giant’s problems reach even further than they originally thought. The U.S. Occupational Safety and Health Administration [OSHA] on Thursday slapped DuPont with a $273,000 fine for safety violations at its plant in La Porte. That’s on top of fines issued in May stemming from last year’s tragedy, when a toxic chemical leak killed four workers. OSHA issued citations to DuPont for what they claimed were: …three willful, one repeat and four serious violations at their chemical manufacturing plant in La Porte. The agency has proposed penalties of $273,000 for these new violations. The issues cited included lack of procedures, inadequate inspections and weak hazard analysis. DuPont was previously cited at their Darrow, Louisiana facility in November 2014 and Deepwater, New Jersey facility in December 2014 for similar process safety management violations. OSHA has also placed the company in its Severe Violator Enforcement Program. DuPont’s website contains no reaction to the OSHA fines, although they do have 15 days to contest them. The last DuPont press release on the La Porte accident was issued two days afterwards, on 17 November 2014, promising further (yet to materialise) updates. One newspaper reported that DuPont has said “it has not had the chance to fully review the latest findings” but is “disappointed with OSHA’s classification”. Comments by CSB on this and Two Previous Fatal Accidents Rafael Moure-Eraso, Chairperson of the CSB said in February 2015: This is my fifth and final year serving...
read moreHelicopter Underslung Load: TV Transmitter
Helicopter Underslung Load: TV Transmitter HESLO In 2014, RF communication infrastructure specialists, The Bridge Network North (now merged into Virtua), undertook a major engineering project at Arqiva’s Croydon TV Transmitter in South London, UK. Arqiva operate much of the UK TV and radio broadcast infrastructure. The project included the replacement of the 10 tonne, 16m, top antenna section on the 153m tower by as a Helicopter External Sling Load Operation (HESLO). A series of lifts were conducted on one day using an Airbus Helicopters AS332C helicopter of HeliSwiss in association with UK company Helirig. This fascinating 3 minute video gives an overview of the project. Also see our articles: What the HEC?! – Human External Cargo, Keep Your Eyes on the Hook! Underslung External Load Safety and French Skyscraper: Helicopter Underslung Load UPDATE 2 July 2020: Erickson videos: Aerossurance has extensive HESLO, helicopter flight operation, safety and contracting experience. For practical aviation advice you can trust, contact us at: enquiries@aerossurance.com Follow us on LinkedIn and on Twitter @Aerossurance for our latest...
read moreMetro III Low-energy Rejected Landing and CFIT
Metro III Low-energy Rejected Landing and CFIT The Transportation Safety Board of Canada (TSB) has issued a report on a fatal accident to Fairchild SA227-AC Metro III, C-GFWX, operated by Perimeter Aviation at Sanikiluaq, Nunavut, on the coast of Hudson Bay on 22 December 2012. The route from Winnipeg is normally operated by sister company Keewatin Air, but Perimeter were chartered to help catch-up a backlog due to poor weather. According to the TSB: Following an attempted visual approach to Runway 09, a non-precision non-directional beacon (NDB) Runway 27 approach was conducted. Visual contact with the runway environment was made and a circling for Runway 09 initiated. Visual contact with the Runway 09 environment was lost and a return to the Sanikiluaq NDB was executed. A second NDB Runway 27 approach was conducted with the intent to land on Runway 27. Visual contact with the runway environment was made after passing the missed approach point. Following a steep descent, a rejected landing was initiated at 20 to 50 feet above the runway. The final, tailwind, approach had been unstable. The TSB determined: …that the aircraft came in too high, too steep, and too fast, striking the ground 525 feet past the end of the runway after an unsuccessful attempt to reject the landing. The 2 crew and 6 adult passengers, secured by their seatbelts, suffered injuries ranging from minor to serious. A lap-held infant, not restrained by any device or seatbelt, was fatally injured. At a news conference on release of the report, investigators said inclement weather, poor visibility, fatigue and a departure from established protocols all played a part in the accident. As the company did not normally fly this route there had been problems obtaining approach plates and survival kits (which were to be borrowed from their sister company). These problems and a defective cargo door indication delayed departure. The TSB commented: The captain felt frustrated as a result of the pre-flight preparation issues, and it is evident from analysis of his speech that signs of frustration persisted after takeoff. The captain’s use of 43 expletives in conversation with the first officer (FO) during the non emergency, non stressful, 2-hour period preceding the occurrence, showed a rate of approximately 21.5 swear words per hour. This type of behaviour was seen as being out of character for the captain. They added that circadian rhythm, the long day and a 1.5 hours wake period in his previous nights sleep mean… …acute sleep disruption may have played a role in the captain’s behaviour during the flight by increasing the risk for fatigue and its associated performance decrements. Two recommendations were issued in relation to the carriage of infants. The airline issued a statement on their actions after the accident. TSB Causes and Contributory Factors The lack of required flight documents, such as instrument approach charts [NOTE: they had been inadvertently forgotten], compromised thoroughness and placed pressure on the captain to find a work-around solution during flight planning. It also negatively affected the crew’s situational awareness during the approaches at CYSK (Sanikiluaq). Weather conditions below published landing minima for the approach at the alternate airport CYGW (Kuujjuarapik) and insufficient fuel to make CYGL (La Grande Rivière) eliminated any favourable diversion options. The possibility of a successful landing at CYGW was considered unlikely and put pressure on the crew to land at CYSK (Sanikiluaq). Frustration, fatigue, and an increase in workload and...
read moreCHC FY2015 Results & Restructuring
CHC FY2015 Results & Restructuring On 29 June 2015 CHC Group (NYSE: HELI), the parent company of CHC Helicopter, reported on Fiscal Year 2015 (to end April 2015). The headlines are: Full-year revenue down 3% to $1.7 billion with a net loss of $795 million (compared to $1.78 billion and a net loss of $171 million in FY2014). Q4 revenue of $374 million and a net loss of $119 million (compared to $453 million and a net loss of $26 million in Q4 FY2014). Restructuring charge of $77 million booked in Q4 in response to the oil and gas industry downturn. Adjusted EBITDAR excluding special items down 2%. $320 million of long-term debt retired in FY2015; annualized interest expense reduced about $30 million. New $145 million asset-backed loan facility which it was stated will provide additional financial flexibility. Full year GAAP net loss per share of $11.17; adjusted EPS loss of $1.82. On 30 June 2015 the company staged an investor webcast with new CEO Karl Fessenden and outgoing CFO Joan Hooper and an accompanying presentation. The annual filing to the Securities and Exchange Commission (SEC), the 10K, is due later this week. Safety The 5 year rolling accident rate is 0.38 per 100k flying hours, unchanged since last year (see presentation page 4). A footnote states this data includes G-CHCN in 2012 and G-WNSB in 2013. While total flying hours in the period are not disclosed, based on recent SEC filings, CHC has been flying an average of about 160k FH per annum, so 0.38 equates to 3 accidents. There was also a ramp accident to VH-LAG in 2011. CHC has made what would, traditionally, have been a sensible choice and compared their performance to the last IOGP (formerly known as OGP) aviation report (1.8 per 100k FH for all offshore helicopters and 0.8 per 100k FH for twins). Unfortunately, while for many years IOGP produced annual reports on aviation accident rates in the oil and gas sector, the last IOGP report was published in 2009, and covers data up to the end of 2007. So their 5 year average covers the truly dreadful year of 2003 through to 2007 but nothing more recent. It is disappointing that current safety benchmark data is not currently available in the public domain. There is other data that could be used in comparison. For example from the Helicopter Safety Advisory Conference (HSAC) for the Gulf of Mexico, which we have discussed recently, where the accident rate for 2010-2014 was 1.22 per 100k FH and the dreadful UK performance of 1.62 per 100k FH from the Feb 2014 UK CAA CAP1145 report for 2008-2012 (combining flight hours from Annex C Table C6 and the 6 accidents from Appendix 1 to Annex C). However, neither is an ideal comparison baseline for a global helicopter company. CHC was a founder member of industry safety organisation HeliOffshore, along with Babcock, Bristow, ERA and PHI. HeliOffshore held their inaugural conference in May. Operational and Financial Data Aircraft availability (of operational aircraft not undergoing scheduled maintenance) has improved (page 8). In FY2014 it slowly increased from a poor 82% up to 90% and has been pretty consistent at around 94% in FY2015. CHC do not state what proportion of their fleet is operational. In early remarks there was positivity about the Operations Control Centre in Dallas and IT standardisation initiatives but also for a change so that...
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