Bristow Group Inc. (BRS – Snapshot Report) is one of those companies feeling the pain of the decline in oil prices even though it’s not an energy company. With oil prices refusing the rebound, this Zacks Rank #5 (Strong Sell) is expecting business to be challenging this year.

Bristow Group provides helicopter services to the offshore energy industry globally. It has major transportation operations in the North Sea, Nigeria, the US Gulf of Mexico and the other major offshore producing regions including Australia, Brazil, Russia and Trindad.

Beat By 7 Cents in the Third Quarter

On Feb 8, Bristow Group reported its fiscal third quarter results and beat the Zacks Consensus by 7 cents. Earnings were $0.67 compared to the consensus of $0.60.

But operating revenue from oil and gas clients fell 21.2%, or $81.2 million, year over year.

Conserving Cash

Bristow believes the dark times aren’t yet over for its energy clients. This downturn is deeper and lasting longer than originally expected.

It expects clients to further cut capital spending in fiscal 2017.

Therefore, it has put together a strategy to maximize cash generation so it’s not caught without options.

It is reducing capital expenditures and cut its dividend to just $0.07 a quarter. It also has a $200 million term loan.

As of Dec 31, 2015, its total liquidity, including cash on hand and availability in its revolving credit facility, was $299.3 million, compared to $369.9 million as of March 31, 2015.

It was able to defer new aircraft deliveries and related capital expenditures in December 2015.

Diversification

Bristow is also continuing to diversify its business model.

On Feb 9, it announced it was investing $4.2 million in Sky-Future, a provider of drone inspection data services for the oil and gas industry.

It opens a new market for the company which also may have non-oil and energy applications.

Estimates Sink

Analysts are bearish on Bristow for fiscal 2016 and 2017 even though Bristow reaffirmed its fiscal 2016 numbers.