Embraer made a net loss of $99.4 million in the second quarter – after a positive result of $129 million in the same period of 2015 – as deliveries of business jets declined and commercial output stagnated.
The Brazilian manufacturer has lowered full-year guidance on the top range of executive-jet deliveries by 25 aircraft, and reduced its forecast revenue by $200 million for 2016.
Second-quarter revenue declined 9.7% year-on-year to $1.37 billion, says Embraer.
In the commercial aviation segment, the manufacturer delivered 26 regional E-Jets in the three months ended 30 June, or one unit fewer than in the same period a year ago. The segment's revenues declined year-on-year by $25.5 million to $857 million. Embraer ended the second quarter with a firm backlog of 500 E-Jets, including 267 for the re-engined and re-winged E2 family scheduled to enter service in 2018.
Moving one step closer to resolving a six-year investigation, Embraer reserved a $200 million contingency for a pending settlement agreement with the US Securities and Exchange Commission. The SEC opened the investigation in 2010 on suspicions of violations by Embraer of the Foreign Corrupt Practices Act. These reportedly involved the sale of Super Tucano light attack aircraft to the Dominican Republic. Embraer says it widened an internal investigation to include sales in other countries.
Negotiations with the SEC and the Department of Justice on terms of the settlement are ongoing, so the $200 million contingency could still change when the agreement is finalised, notes Embraer.
Source: Cirium Dashboard
