Bombardier’s commercial and business aircraft divisions posted stronger profits in the first quarter of 2019, reflecting sales by Bombardier of major assets formerly held by each unit.
Bombardier’s commercial aircraft unit earned a profit before interest and taxes of $22 million in the first quarter, reversing a $73 million loss in the first quarter of 2018.
The positive swing reflects factors including the divestiture of majority ownership of CSeries - now the A220 - to Airbus last year, and an increase in aftermarket sales, Bombardier said on 2 May.
Commercial aircraft revenue sunk by nearly half year-on-year to $241 million, and commercial aircraft deliveries declined by half, to four, including three CRJ900s and one Q400.
The decline in revenue and deliveries likewise reflects Bombardier’s divestiture of the CSeries.
Montreal-based Bombardier secured additional orders for 16 commercial aircraft in the first quarter, including nine CRJ900s and seven Q400s. At the end of March, it had outstanding orders for 109 commercial aircraft, including 51 CRJ900s and 58 Q400s.
The airframer expects to deliver 30 commercial aircraft this year, down from 35 last year.
Bombardier continues to seek a “strategic” option for the CRJ, Bellemare says. Investors have taken that language to mean the CRJ programme is up for sale.
The business aircraft unit earned a first quarter profit of $594 million, nearly six times more than its first quarter 2018 profit. The bump largely reflects a $516 million gain from Bombardier’s sale in March of a business aircraft training unit to CAE, Bombardier says.
The business aircraft division’s first quarter revenue slipped 13% year-on-year to $970 million. Bombardier delivered 24 business jets in the period, down from 31 last year.
Bombardier says its new Global 5500 and 6500 are on track for certification and first deliveries by the end of the year.
The company also expects the rate of its aircraft deliveries to increase as 2019 progresses. It anticipates delivering 150-155 business aircraft this year.
Bombardier’s aerostructures and engineering business earned a $66 million profit in the first quarter of 2019, up 43% year-on-year.
The company’s first quarter results come as Bombardier continues a major overhaul aimed at greater focus on business aviation.
Bombardier on 2 May signaled that theme remains central, announcing plans to sell aerostructures sites in Belfast and Morocco and to merge all aircraft activities into a single business called Bombardier Aviation.
“We want to focus on business aircraft going forward,” chief executive Alain Bellemare tells investors. “That’s where we are putting our chips.”
Source: Cirium Dashboard