Basis of Presentation |
12 Months Ended | ||||||||||||||||||||||||||||||||||||
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Dec. 31, 2015 | |||||||||||||||||||||||||||||||||||||
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||
| Basis of Presentation | BASIS OF PRESENTATION Nature of Business Erickson Incorporated (“EI”) and its subsidiaries and affiliated companies (collectively referred to as “Erickson” or “the Company”) is a global provider of aviation services. We own, operate, maintain and manufacture utility aircraft to transport and place people and cargo around the world for commercial and governmental entities, with three distinct reportable segments consisting of Commercial Aviation Services, Global Defense and Security, and Manufacturing and Maintenance, Repair and Overhaul (“MRO”). Through our Commercial Aviation Services and Global Defense and Security segments, we provide aerial services that include critical supply and logistics for firefighting, timber harvesting, infrastructure construction, deployed military forces, humanitarian relief, and crewing. Through our Manufacturing and MRO segment, we provide manufacturing and maintenance, repair and overhaul services for certain aircraft, as well as aircraft sales. As of December 31, 2015, the Company has a diverse fleet of 74 aircraft consisting of: 20 heavy lift helicopters, known as “Aircranes”; 47 rotor-wing aircraft; and 7 fixed-wing aircraft. The Company’s fleet includes 15 aircraft held for sale and operations that span the globe with a presence on six continents and 33 aircraft deployed outside of North America as of December 31, 2015. As a global provider of aviation services, a significant portion of our revenues are generated outside of the United States of America (“U.S.”) and represented 63.6%, 70.2% and 65.8% of revenues for the years ended December 31, 2015, 2014 and 2013, respectively. Although the global deployment of the Company’s aircraft and crews helps limit the effects of seasonality, the demand for the Company’s services are generally reduced in winter or monsoon seasons, January through April, with peak season from June through October. Principles of Consolidation The consolidated financial statements of the Company include the accounts of all majority-owned subsidiaries and variable interest entities in which it has determined the Company is the primary beneficiary as follows:
EuAC owns a 60% equity interest in Societa Italiania de Manutenzioni Aeroautiche S.p.A. (“SIMA”), which is an aircraft maintenance organization located in Lucca, Italy. For entities that are determined to meet the definition of a VIE and where the Company has determined it is the primary beneficiary, the VIE is consolidated and a noncontrolling interest is recognized for any third party interest. This has resulted in the Company consolidating entities in which it has less than a 50% equity interest. For further information, see Note 21. Intercompany accounts and transactions between the companies are eliminated upon consolidation. Reclassifications To conform with the 2015 presentation, the Company reclassified: (i) income tax receivable of $0.7 million with prepaid expenses and other current assets; (ii) income tax payable of $0.3 million with accrued and other current liabilities; and (iii) uncertain tax positions of $6.3 million and deferred tax liabilities of $3.7 million with other liabilities in the Company’s consolidated balance sheet as of December 31, 2014. In addition, deferred overhauls, net of $86.8 million and construction-in-progress of $10.4 million was reclassified from property, plant and equipment, net to aircraft, net on the consolidated balance sheet as of December 31, 2014, and for the years ended December 31, 2014 and 2013, external sales commissions of $2.3 million and $1.9 million, respectively, was reclassified from sales and marketing expense to cost of revenues and bad debt expense of $0.1 million and $0.3 million, respectively, was reclassified from sales and marketing expense to general and administrative expense in the consolidated statements of operations. To conform with the balance sheet reclassifications discussed above, the Company reclassified the change in income tax receivable of $0.4 million and $0.9 million with the change in prepaid expenses and other current assets in the operating activities section of the statements of cash flow for the years ended December 31, 2014 and 2013, respectively, as well as the change in income tax payable of $0.6 million and $0.3 million, respectively, with the change in accrued expenses and other current liabilities. As a result of the adoption of the provisions of Accounting Standards Update (“ASU”) 2015-03, Interest—Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”) on December 31, 2015, we reclassified $11.4 million of debt issuance costs from other noncurrent assets to credit facility in the amount of $2.3 million and long-term debt in the amount of $9.1 million, including $1.7 million related to the current portion of long-term debt, in our consolidated balance sheet as of December 31, 2014. For additional information, see Recent Accounting Pronouncements in Note 2. As a result of the adoption of the provisions of ASU 2015-17, Balance Sheet Classification of Deferred Taxes (“ASU 2015-17”) on January 1, 2015, we reclassified current deferred tax asset of $1.2 million and liability of $0.9 million to a noncurrent deferred tax asset of $0.3 million, with a nominal amount to the noncurrent deferred tax liability in our consolidated balance sheet as of December 31, 2014. For additional information concerning the provisions of ASU 2015-17, see Recent Accounting Pronouncements in Note 2. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. (GAAP) requires management to make assumptions and estimates that affect the reported amounts of assets and liabilities, and disclosure of gain or loss contingencies, as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates for which changes in the near term are considered reasonably possible, and that may have a material impact on the consolidated financial statements, are: (a) excess and obsolete aircraft support parts reserves, (b) allowance for doubtful accounts, (c) income tax assets and liabilities, and (d) estimates and assumptions made in determining the carrying values of goodwill and other intangible assets. Management of the Company base their estimates on historical experience and other relevant assumptions. Actual results could differ materially from those estimates. Foreign Currency Translation and Transactions The financial statements of the Company’s subsidiaries CAC, EuAC, Air Amazonia and EAT, are measured in their functional currencies of the Canadian dollar (C$), Euros (€), Brazilian Real (R$), and Turkish Lira (₤), respectively, and then are translated into U.S. dollars. Generally, balance sheet accounts are translated using the current exchange rate at each balance sheet date. Results of operations are translated using the average exchange rate each month. Translation gains or losses resulting from the changes in the exchange rates from month to month are recorded in other comprehensive income. The financial statements of the Company’s subsidiaries EHI, EACM, and EAP are prepared using the U.S. dollar as their functional currency, with any foreign currency gain or loss resulting from the re-measurement of transactions denominated in foreign currencies included in other income (expense), net in our consolidated statements of operations. |