(Bloomberg News circulated the following article on November 30.)
MONTREAL — Bombardier Inc., the world’s bigger maker of railroad equipment, posted a third-quarter loss because of costs to cut jobs at its European train operations.
The net loss of $9 million, or 1 cent a share, compares with net income of $10 million, or break-even on a per-share basis, a year earlier. Revenue in the quarter ended Oct. 31 dropped a more -than-anticipated 7.3 percent to $3.34 billion, Montreal-based Bombardier said today in a statement.
Bombardier, which had $25 million in costs linked to employee reductions in the quarter, has cut about 5,500 of the 7,600 jobs it’s planning to eliminate at the unit by May.
Deliveries of the company’s business jets climbed 71 percent in the period, boosting revenue at its aerospace unit.
“The restructuring in Bombardier’s transportation business continues,” Jean-Philippe Choquette, a fund manager at Fiera Capital Management in Montreal, said in a telephone interview yesterday. “They are trying to improve margins quarter after quarter.”
Fiera Capital oversees the equivalent of $9.4 billion in assets, including Bombardier shares.
Bombardier’s widely traded Class B shares fell 4 Canadian cents to C$2.58 in Toronto Stock Exchange composite trading yesterday. They have risen 8.4 percent this year.
Excluding some restructuring costs, Bombardier said it would have broke even in the quarter on a per-share basis.
Bombardier was expected to earn 2 cents a share, the average estimate of 11 analysts surveyed by Thomson. Thomson spokeswoman Ayesha Haider didn’t return a call seeking comment on whether the estimate includes one-time costs or gains.
Revenue fell short of the $3.65 billion average forecast by five analysts in a Thomson Financial survey.
Aircraft Business
Deliveries of business jets helped increase revenue at the aerospace business by 9.9 percent to $1.79 billion. That helped mitigate a 37 percent decline in sales of regional planes on weak demand from struggling U.S. airlines. Four of Bombardier’s customers, including Delta Air Lines Inc. and Northwest Airlines Corp., are under bankruptcy protection.
“There is no doubt the financial distress facing some of our airline customers had an impact on our results,” Bombardier Chairman and Chief Executive Laurent Beaudoin said in the statement. “We will continue to implement proactive measures to reduce our costs and manage risk.”
The company is the world’s third-largest maker of commercial aircraft after Airbus SAS and Boeing Co.