BAS reports $4.5 million loss

MONDAY, JULY 9: BAS reported a loss of $4.5 million for the year ended March 31, 2012.

The loss per share was $0.93.

Earnings from continuing operations for the year were $2.7 million.

The directors and management of BAS felt these results “are commendable given the state of Bermuda’s economy.”

The net loss was a consequence of two key events that occurred during the year.

The first event was the decision to discontinue major operating segments at Aircraft Services Bermuda Ltd. (ASB).

During the year BAS executed a plan to discontinue operations of select segments of ASB.

This was facilitated by an asset sale to a third-party. While the net cash implications of the discontinuance were minimal, the accounting implications of the transaction have negatively impacted earnings by $1.5 million.

The second and more material event that occurred during the year arose as a consequence of a write-down of part of the goodwill that was carried on the BAS consolidated statement of financial position of $18.1 million.

After conducting annual goodwill impairment testing, it was concluded that a permanent impairment existed in the value of goodwill carried in relation to the cargo handling segment of the business.

Therefore, a goodwill impairment loss in the amount of $5.7 million has been recognized in the current year’s results.

This adjustment, while significantly impacting earnings, had no cash impact on the company.

A spokesperson said BAS continues to generate excellent cash flows from its operations and consequently remains in a very strong cash position, up over $3 million from the prior year, with a cash balance of $9.4 million at year-end.

“This has allowed the Company to pay a special dividend of $0.02 per share during the year in addition to maintaining a quarterly dividend of $0.05 per share.”

BAS chairman, Michael Darling, said: “BAS was born out of aviation and has a rich history in Bermuda’s aeronautical past.

“Today, aviation plays a very small part in the day-to-day operations of the Group.

“The name belies the modern face of BAS as a well-rounded service company that crosses several industry segments. It is through its diverse but complimentary corporate service base that BAS is able to provide a measure of stability in these uncertain times. ”