MONTREAL — The chief executive of Bombardier Inc. said Tuesday there will be a surge of aircraft deliveries as well as new orders in the current quarter to help the industrial giant meet its year-end financial targets, the Canadian Press reported.
Robert Brown, during a conference call to discuss a fairly strong third quarter, said the aerospace division will deliver 120 aircraft in the current quarter ending Jan. 31, enough targets for the fiscal year. Bombardier is calling for earnings of 33 cents per share for the fourth quarter, which traditionally is the company’s strongest.
However Brown refused to give guidance for the coming financial year, as the company used to do, citing the uncertainties of the North American economy, the fragility of large U.S. airline clients, and the possibility of war in the Middle East.
“We’re going to have to proceed on a quarter-by-quarter basis,” said Brown.
Earnings for the period ended Oct. 31 reached $209.4 million or 15 cents a share, below the 19 cents forecast by a consensus of analysts.
That compares with a loss of $368 million, or 27 cents the year before, when there was a slew of special charges – including a $264-million writedown on the value of its Q400 turboprop aircraft.
Excluding income taxes and special items, income for the three-month period dropped to $313.4 million from $362.9 million.
Revenue rose 13 per cent to $5.6 billion.
Brown said that about 1,000 employees of the 1,980 aerospace job cuts announced in September have left, while another 2,100 working on business jet programs are on temporary layoff to reflect the weak market for corporate jets. In the first nine months, the company delivered 227 aircraft of all types compared with 271 the same period last year. However the dropoff was mainly on the business jet side – 66 deliveries compared with 111 last year.
Falling sales of business jets like the Challenger, Learjet and Global Express were partly offset by a higher number of regional aircraft deliveries in the quarter.
Addressing concerns that the high-end Global Express business jet is doing poorly, Brown said it’s “just a matter of time. You’re going to see some rebound in the fourth quarter and next year.”
While noting that historically the fourth quarter is the strongest, Brown warned that “the business aircraft market remains difficult and major U.S. airlines are still facing uncertainty.”
Revenues for the aerospace division slipped to $2.4 billion from $2.6 billion, while income before taxes was $111.2 million, compared with $240 million.
Aircraft orders totalled $21.3 billion as at Oct. 31, down from $24.9 billion one year ago.
In the transportation sector, which includes rail and transit equipment manufacturing mainly based in Europe, quarterly revenues shot up 32 per cent to $2.3 billion, attributed to a higher level of activities and from the increase in the value of the euro, compared with the Canadian dollar.
Income before income taxes rose 63 per cent to $106.7 million.
Bombardier Transportation’s $23.1-billion order backlog as at Oct. 31 compares with $21 billion the same time last year. “We’ve been winning our fair share of the contracts,” said Brown.
Revenues in the recreational products division grew by 35 per cent to $745.1 million, while those of Bombardier Capital were flat at $234.6 million.
Bombardier has a workforce of some 80,000 people in 24 countries.
On the Toronto stock market Tuesday, Bombardier class-B shares (TSX:BBD.B) lost 55 cents to $5.40.
Analyst Christopher Sears of MacDougall MacDougall & MacTier Inc. commented that the report had no major surprises.
“It’s a positive development that they’re comfortable with their previous guidance (given in August).”