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Embraer reports slight rise in 2017 defence revenue

Revenue generated from Embraer’s defence and security division rose 1.9% to $951 million in 2017.

The increase in defence-related sales for the Brazilian airframer came as the firm posted declining revenue from its commercial aircraft and executive jet divisions. The company generated $5.84 billion in revenue in 2017, a 6.1% drop from when it generated $6.22 billion in 2016. It reported an operating profit of $329 million last year, and an operating margin of 5.6%.

The firm’s fourth quarter sales fell 14.5% to $1.73 billion, compared to the same period in 2016. Its defence revenue for the fourth quarter fell 15% to $271 million, compared to the same period in 2016.

Embraer closed 2017 with a $4.2 billion order backlog for its defence business. It is projecting $800 million to $900 million in defence sales this year. The firm also projects that its total revenue across all divisions is vulnerable to declining again with an estimated range of $5.4 billion to $5.9 billion in sales in 2018.

Last year, Embraer delivered four Phenom 100 business jets for flight training services to the United Kingdom’s Ministry of Defence. The company also received orders for 18 A-29 Super Tucano light attack aircraft in the fourth quarter from an undisclosed customer, the Philippine Air Force, and the US Air Force, which purchased the aircraft on behalf of the Afghan Air Force.

Its first production KC-390 troop transport jet is expected to enter service with the Brazilian air force’s 11th Wing in Rio de Janeiro later this year.

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