Bombardier Aerospace saw its fiscal third quarter revenues dip slightly to $2.3 billion from $2.4 billion in the year-earlier period, reflecting lower deliveries of commercial aircraft as struggling carriers sought deferrals.
The Canadian airframer's earnings report for the three months ended 31 October has been released as it cautions of "some cancellations" going forward due to difficulties in the marketplace.
During an earnings conference call this morning, Bombardier Aerospace president Guy Hachey said that in terms of the pace of aircraft cancellations and deferrals, "it is not a large percentage of our total backlog", although it is "something we expect to be slightly larger than in the past".
Mexican carrier Alma, which ceased operations last month, this year cancelled two CRJ units.
Hachey says Bombardier continues to work with customers that have requested delivery deferrals "to try to accommodate them as much as we can".
For the three months ended 31 October, Bombardier delivered a total 80 aircraft - 57 business aircraft, 22 commercial and one amphibious - compared to 90 aircraft for the same period the previous year.
The 22-aircraft delivery figure for commercial compares to 33 for the same period last fiscal year.
"The lower number of deliveries is mainly due to some customers requesting deferral of deliveries to the [fiscal] fourth quarter, and the impact on production of the transition from the Q200 and Q300 aircraft to the Q400 turboprop," says Bombardier.
The Canadian airframer notes, however, that commercial order intake totalled 20 aircraft in the fiscal third quarter, up from 12 for the same period last fiscal year.
On the business aircraft side, a softening in demand resulted in net orders for 48 business aircraft versus 124 during the corresponding period.
Nonetheless, the aerospace unit's fiscal third quarter EBIT rose to $199 million or 8.7% of revenues, representing an increase from the $122 million EBIT posted a year earlier.
This boost was due to a number of factors, among them improved selling prices and a favourable mix for business aircraft and improved selling prices for commercial aircraft.
Overall, Bombardier - which is also heavily involved in the rail business - recorded net income of $245 million on consolidated revenue of $4.6 billion. This compares to a 2008 fiscal third quarter net profit of $91 million on revenue of $4.2 billion in the prior year's fiscal third quarter.
"Although it is too early to assess the severity and duration of the economic slowdown and its potential impact on both businesses, we are confident in our future, having taken significant steps in the past few years to strengthen our operations and financial position," says Bombardier president and CEO Pierre Beaudoin.
He adds: "Overall, our corporation is well positioned and we don't see a significant impact on us at the moment."
Source: Air Transport Intelligence news
