Oil and Gas

Lockheed sees some positive signs in commercial helicopter market

BERLIN, June 1 (Reuters) - Lockheed Martin Corp said on Wednesday it is seeing some encouraging signs in the commercial helicopter market after last year’s slump in demand from oil and gas companies as the sector grappled with a collapse in oil prices.

Nathalie Previte, vice president of sales and marketing for Sikorsky, a unit of Lockheed, said in an interview during the Berlin airshow that she expected flat demand for commercial helicopters this year, with analysts forecasting a return to growth in 2017.

Previte said Sikorsky had expected a sharp drop in flight hours in the sector in 2015, given a number of contract cancellations, but that flight hours actually rose by 1 percent in the year ended December 2015.

In addition, she said Sikorsky had won several tenders in the sector this year, including two deals in Norway, one in Asia and several others that she could not identify due to customers’ security concerns. The deals do not necessarily represent new helicopter sales, but they keep Sikorsky helicopters flying in the sector, she said.

“So far this year, we have had great success in these competitions,” Previte said, noting that the price of oil was also rising slowly.

Previte’s remarks come amid continued questions about whether Lockheed paid too much for its $9 billion Sikorsky takeover last year given the slump in oil prices and the resulting drop in sales of commercial helicopters used to ferry workers to offshore oil rigs.

Previte cautioned against reading too much into the positive news given residual issues in that market, including large excess capacities.

Steve O’Bryan, who heads business development for Lockheed’s mission systems and training business, said he also saw opportunities for Sikorsky to sell more search and rescue helicopters, as well as VIP transports.

The company expected to land another large VIP transport order from an Asian country this summer, O’Bryan said, without providing any details. (Editing by Matthew Lewis)