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Gulfstream records 'solid' first quarter performance

Gulfstream is experiencing a period of “solid but not overheated demand” for its high-end business jet family, and the market remains robust for the foreseeable future, parent company General Dynamics says.

Speaking on a first-quarter earnings call on 24 April, company chief executive Phebe Novakovic was upbeat about the company’s prospects. Following a strong performance in 2018, “we’re off to a good start [this year]", she says.

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Deliveries climbed by nearly a third year on year, from 26 to 34 aircraft – largely due to a ramp-up of G500 production. The super-wide-cabin, long-range business jet entered service in September and to date Gulfstream has delivered 17 units – 10 in 2018 and seven in the first three months of 2019.

Gulfstream also shipped 20 large-cabin-category G650/ERs and G550s during the period – one more than last year – while deliveries of its super-midsize G280 remained flat at seven units.

Orders outpaced deliveries during the period, resulting in a book-to-bill ratio of 1.5:1. Backlog for the G650, G500, and its larger, in-development sibling, the G600, all increased in the quarter.

Novakovic says the exact timing of G600 type certification is difficult to predict “given the FAA’s rigorous review process”. However, she is confident of securing approval for the 6,500nm (10,200km)-range aircraft before the end of June, with service entry “on track” to follow in the second half of the year.

By 24 April, the five aircraft in the G600 flight-test programme had logged more than 3,150h over 838 flights. Gulfstream says some trials related to function and reliability testing are still outstanding.

Gulfstream continues to ramp-up production of the nacelle system for the Pratt & Whitney Canada PW800 engine that powers the G500 and G600.

It acquired the nacelle line in September from its former supplier Nordam, after mounting debts forced the aerostructures company to suspend output and file for Chapter 11 bankruptcy protection.

The Oklahoma-based firm emerged from court protection in April after reorganisation and a $140 million cash infusion from private equity company The Carlyle Group.

Novakovic says restarting the dormant supply chain has impacted the delivery schedule for the G500, but she expects these issues “to be behind us by mid-year”.

General Dynamics' aerospace division recorded a $450 million increase in revenues in the first quarter, to $2.2 billion. This growth is largely attributable a "strong" performance from Jet Aviation and its maintenance arm.

The business was expanded in May 2018 with the acquisition of Asia-Pacific’s largest business aviation services provider, Hawker Pacific.

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