CHC Helicopter Corporation (NYSE: FLI), headquartered in British Columbia, is the world's largest supplier of helicopter services to the oil and gas exploration and drilling industries. The company recently posted impressive second quarter (2Q) FY 2008 results that showed revenue up 17% and operating income up 21%. Operating income increased at the same time as corporate expenses declined. Net earnings for 2Q rose 20%, driven in large part by global operations revenue increase of 34% and European operations revenue increase of 14%.

CHC Helicopter took delivery of 8 new aircraft during the quarter, with 16 more to be delivered in FY 2008, and an additional 61 aircraft on target for delivery over the next 5 years. In order to service its expanding fleet, CHC is expanding its own maintenance capabilities at its new maintenance facility currently under construction. Because CHC is in the midst of a growth period, leasing expenses continue to increase, as do interest expenses and debt levels. These expense increases continue to be more than offset by increases in flying (billable) hours and a growing customer base.

Many of CHC's customers do business in risky areas of the world. Conservative investors will want to take a close look at the company's risk management policies while performing their normal due diligence.

CHC Helicopter Corporation ( NYSE: FLI) just inked multi-year contracts worth in excess of $180,000,000 Canadian over the next 5 years to provide flight service as well as maintenance in places as far flung as Namibia, Kazakhstan, Baku, and the Philippines. CHC Helicopter is the world's largest helicopter services supplier to the offshore oil and gas industry, and is working hard at getting bigger. CHC recently released 1Q FY 2008 results. The company is flying high. Revenue in all operating segments increased, in some cases significantly. Total revenue increased 21% to $320 million for the quarter and net income tripled from $0.19 per diluted share to $0.61.

The problem with CHC Helicopter is that it is growing revenue at the expense of profit. The company is expanding its fleet of helicopters and trading in older models for newer. While necessary, such expansion also means that the company's debt load has increased, as have its leasing expenses and its interest expenses. Taken together, these additional expenses caused operating income to decrease by 16%. The company refinanced to give itself $100 million additional borrowing capacity in multiple currencies. With 70 copters on order over the next 5 years, it may need every penny of that capacity to fund its growth.

CHC Helicopter already operates a higher-risk business in risky areas. Investors will need strong nerves to hold on to this stock as it grows itself through debt financing and refinancing.