Graham Warwick/WASHINGTON DC
Bombardier is looking to shore up its non-aviation businesses in an effort to remain diversified in the face of the continued growth of its aerospace sector.
Aerospace accounted for almost 60% of the Canadian company's revenues of C$13.6 billion ($9.3 billion) for the year ended 31 January, up from 56% the previous year. For the second year running, the sector also accounted for over 80% of pre-tax profits.
While Bombardier chief executive Bob Brown says the company's aerospace business is itself diversified, covering business and regional aviation, he admits: "It is a problem. Aerospace will continue to grow. We will have to try to bring our other businesses along." Brown confirms that the objective "remains to be diversified".
Aerospace led growth last year, with increased aircraft deliveries pushing revenues up 26%, to C$8.1 billion. Revenues in the rail transport segment rose 16%,to C$3.4 billion, while sales of recreational products fell 10%, to C$1.5 billion, and financing arm Bombardier Capital saw revenues rise 29%, to C$738 million.
Overall, revenues rose 18%, while net income climbed 30%, to C$719 million. Bombardier projects similar earnings growth for this year and next and still expects to double its revenues over the next five years. Driving this will be higher aircraft production, with deliveries of the CRJ regional jet set to increase from 112 this year to 135 in 2001-2 and 150 in 2002-3.
To remain diversified, the company is looking at new recreational products and hoping for growth after restructuring in its transport and capital segments. Brown also expects the services business to grow, although Bombardier took a fourth quarter charge of C$44.5 million after abandoning certain areas of its Commercial Aviation Services business.
Source: Flight International
