Loading

Bombardier Reports First Quarter 2017 Results

Direct News Source

11-May-2017 Bombardier Reports First Quarter 2017 Results

  • Reports EBIT margin(1) expansion led by strong performance at Transportation and Business Aircraft
  • Continued improvement in year-over-year cash performance(1)
  • Full year guidance reaffirmed
  • Pierre Beaudoin to assume role of Non-Executive Chairman, concluding smooth transition of executive responsibilities

Bombardier (TSX:BBD.A)(TSX:BBD.B)(OTCQX:BDRBF) today reported its first quarter 2017 results, demonstrating continued momentum executing its turnaround plan. Highlighting the company's progress was strong organic growth at Transportation, EBIT margin(1) expansion at both Transportation and Business Aircraft, and significantly improved year-over-year cash performance(1).

Bombardier reported revenues of $3.6 billion and EBIT before special items was $128 million. EBIT margins before special items grew to a robust 8.0% at Transportation, 7.6% at Business Aircraft and 7.5% at Aerostructures, while Commercial Aircraft recorded an EBIT loss in line with the prior year. Free cash flow usage improved by $157 million to $593 million for the quarter.

"We continue to gain momentum as we execute our transformation plan and begin to unleash the full value of the Bombardier portfolio," said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc. "Our continued margin expansion and improving cash performance demonstrate both the early benefits of our actions and the long-term potential of our company."

Bombardier also announced that Pierre Beaudoin intends to step down as Executive Chairman of the Board effective June 30, 2017. Mr. Beaudoin will continue to serve as Non-Executive Chairman.

"This change reflects the very successful transition of Bombardier's executive leadership to Alain over the past two years," said Beaudoin. "As Chairman I look forward to working with the Board of Directors to provide continuing support to Alain and the leadership team. The Company is firmly on the right path, with a very strong leadership team now in place to execute its turnaround plan and return Bombardier to long-term, sustainable growth."

The change to Mr. Beaudoin's position is subject to the formal approval of Bombardier's Board of Directors, which is expected following the Company's Annual General Meeting later today.

SELECTED RESULTS

Three-month periods ended March 31

2017

2016

Variance

Revenues

$

3,576

$

3,914

(9

)%

EBIT

$

105

$

56

88

%

EBIT margin

2.9

%

1.4

%

150 bps

EBIT before special items(2)

$

128

$

130

(2

)%

EBIT margin before special items(2)

3.6

%

3.3

%

30 bps

EBITDA before special items(2)

$

206

$

219

(6

)%

EBITDA margin before special items(2)

5.8

%

5.6

%

20 bps

Net loss

$

(31

)

$

(138

)

nmf

Diluted EPS (in dollars)

$

(0.02

)

$

(0.07

)

nmf

Adjusted net income (loss)(2)

$

2

$

(34

)

nmf

Adjusted EPS (in dollars)(2)

$

0.00

$

(0.03

)

nmf

Net additions to PP&E and intangible assets

$

276

$

294

(6

)%

Free cash flow usage(2)

$

(593

)

$

(750

)

21

%

As at

March 31, 2017

December 31, 2016

Available short-term capital resources(3)

$

3,867

$

4,477

(14

)%

All amounts in this press release are in U.S. dollars unless otherwise indicated.

Amounts in tables are in millions except per share amounts, unless otherwise indicated.

Bombardier reported consolidated revenues of $3.6 billion in the quarter, which is in line with expectations and highlights renewed growth momentum in Transportation. EBIT before special items was $128 million, up from $104 million in the fourth quarter and in line with last year, as margins continue to demonstrate the benefits of the transformation plan. EBIT margin before special items grew to a robust 8.0% in Transportation and achieved 7.6% in Business Aircraft and 7.5% in Aerostructures and Engineering Services. Free cash flow usage improved to $593 million while Bombardier continued to invest in the Global 7000 and Global 8000 aircraft program testing and certification phase as well as inventories supporting the production ramp-up of the C Series aircraft program and certain key Transportation projects. These results lead Bombardier to reiterate its full year guidance of revenue growth in the low-single digits, excluding currency impacts, EBIT before special items between $530 million and $630 million and free cash flow usage between $1.0 billion and $750 million.

SEGMENTED RESULTS AND HIGHLIGHTS

Business Aircraft

Results of the quarter

Three-month periods ended March 31

2017

2016

Variance

Revenues

$

1,007

$

1,303

(23

)%

Aircraft deliveries (in units)

29

31

(2

)

EBIT

$

74

$

82

(10

)%

EBIT margin

7.3

%

6.3

%

100 bps

EBIT before special items

$

77

$

87

(11

)%

EBIT margin before special items

7.6

%

6.7

%

90 bps

EBITDA before special items

$

97

$

112

(13

)%

EBITDA margin before special items

9.6

%

8.6

%

100 bps

Net additions to PP&E and intangible assets

$

208

$

153

36

%

As at

March 31, 2017

December 31, 2016

Order backlog (in billions of dollars)

$

15.2

$

15.4

(1

)%

  • Deliveries and revenues for the first quarter reflect typical seasonal patterns, achieving in excess of 20% of full year guidance of 135 deliveries.
  • EBIT margin before special items improved by 90 bps from 6.7% to 7.6% in the first quarter.
  • Continued to make significant strides in the development of the Global 7000 and Global 8000 aircraft program, with two FTVs in flight testing demonstrating a high degree of maturity. Subsequent to the end of the quarter, the third FTV joined the flight test program. The two remaining FTVs are in advanced stages of production. The Global 7000 aircraft is expected to enter into service in the second half of 2018.

Commercial Aircraft

Results of the quarter

Three-month periods ended March 31

2017

2016

Variance

Revenues

$

540

$

616

(12

)%

Aircraft deliveries (in units)

15

20

(5

)

Net orders (in units)

11

2

9

Book-to-bill ratio(4)

0.7

0.1

0.6

EBIT

$

(56

)

$

(66

)

15

%

EBIT margin

(10.4

)%

(10.7

)%

30 bps

EBIT before special items

$

(55

)

$

(66

)

17

%

EBIT margin before special items

(10.2

)%

(10.7

)%

50 bps

EBITDA before special items

$

(37

)

$

(40

)

8

%

EBITDA margin before special items

(6.9

)%

(6.5

)%

(40) bps

Net additions to PP&E and intangible assets

$

75

$

113

(34

)%

As at

March 31, 2017

December 31, 2016

Order backlog (in units)

432

436

(4

)

  • The C Series aircraft are performing well with now 10 C Series aircraft in service with both Swiss International Air Lines (SWISS) and Air Baltic Corporation AS (airBaltic).
  • Significantly ramped-up C Series aircraft production in the first quarter in preparation for an acceleration of deliveries in the second half of 2017, which will be driven by the recently awarded London City Airport steep approach certification for the CS100 aircraft as well as the anticipated delivery of the first CS300 aircraft to SWISS and the entry into revenue generating service of the CS300 aircraft in Korean Air's fleet.
  • During the quarter, we received orders for 10 CRJ900 aircraft from CityJet, increasing its CRJ Series fleet to 22 aircraft. Based on list price, the firm orders are valued at $467 million.
  • Subsequent to the end of the quarter, Transport Canada and the European Aviation Safety Agency awarded the CS100 aircraft its steep approach certifications, allowing the aircraft to operate at challenging airports such as London City Airport.

Aerostructures and Engineering Services

Results of the quarter

Three-month periods ended March 31

2017

2016

Variance

Revenues

$

388

$

468

(17

)%

External order intake

$

103

$

99

4

%

External book-to-bill ratio(5)

1.0

0.9

0.1

EBIT

$

29

$

15

93

%

EBIT margin

7.5

%

3.2

%

430 bps

EBIT before special items

$

29

$

35

(17

)%

EBIT margin before special items

7.5

%

7.5

%

-

EBITDA before special items

$

45

$

49

(8

)%

EBITDA margin before special items

11.6

%

10.5

%

110 bps

Net additions to PP&E and intangible assets

$

8

$

4

100

%

As at

March 31, 2017

December 31, 2016

External order backlog (in millions of dollars)

$

38

$

42

(10

)%

Transportation

Results of the quarter

Three-month periods ended March 31

2017

2016

Variance

Revenues

$

1,923

$

1,880

2

%

Order intake (in billions of dollars)

$

2.2

$

1.2

83

%

Book-to-bill ratio(6)

1.1

0.7

0.4

EBIT

$

134

$

23

483

%

EBIT margin

7.0

%

1.2

%

580 bps

EBIT before special items

$

153

$

115

33

%

EBIT margin before special items

8.0

%

6.1

%

190 bps

EBITDA before special items

$

177

$

139

27

%

EBITDA margin before special items

9.2

%

7.4

%

180 bps

Net additions to PP&E and intangible assets

$

6

$

23

(74

)%

As at

March 31, 2017

December 31, 2016

Order backlog (in billions of dollars)

$

30.9

$

30.1

3

%

  • Revenue growth is gaining momentum as execution of key projects progresses, increasing 5% compared to the same period last fiscal year excluding the currency impact.
  • EBIT margin before special items increased by 190 bps compared to the same period last fiscal year, reaching 8.0%, including the positive impacts of transformation initiatives.
  • During the first quarter of 2017, we won several significant orders in Europe, mainly in France, Germany and Switzerland, as well as in Malaysia, resulting in a book-to-bill ratio of 1.1. The majority of our order intake in the first quarter of 2017 is based on current product platforms, supporting the re-use of existing technologies.

Download Files

There are files associated with this article. You can download them below.

You need to be logged in to download files.