Bombardier has recently reported its second quarter 2016 results and reaffirmed its full year guidance.
"We continue to make very good progress executing our turnaround plan," said Alain Bellemare, president and chief executive officer, Bombardier Inc. "We delivered on our financial commitments, achieved our program milestones and positioned Bombardier to meet both our full year guidance and 2020 goals."
Highlighting the company's recent progress is the C Series entry-into-service and the certification of the CS300 aircraft - the larger version of the C Series. These significant milestones reflect the completion of the C Series' development phase and transition into production ramp-up. As the industry's first clean-sheet designed narrow-body aircraft in nearly 30 years, the C Series offers the best passenger experience, environmental performance and operating costs in the 100- to 150-seat class.
"This was a pivotal quarter for the C Series as both variants are now certified and the program has begun generating revenue," Bellemare continued. "Having firmly placed Bombardier on a path to profitable earnings growth and cash generation, we remain focused on delivering customer and shareholder value by improving productivity, executing flawlessly on our programs and applying a disciplined and proactive approach to our portfolio."
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Results of the quarter |
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Three-month periods ended June 30 |
2016 |
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2015 |
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Revenues |
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$4,309 |
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$4,620 |
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EBIT |
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$(251) |
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$226 |
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EBIT margin |
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(5.8)% |
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4.9% |
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EBIT before special items(1) |
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$106 |
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$226 |
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EBIT margin before special items(1) |
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2.5% |
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4.9% |
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EBITDA before special items(1) |
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$204 |
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$329 |
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EBITDA margin before special items(1) |
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4.7% |
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7.1% |
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Net income (loss) |
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$(490) |
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$125 |
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Diluted EPS (in dollars) |
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$(0.24) |
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$0.06 |
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Adjusted net income (loss)(1) |
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$(83) |
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$145 |
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Adjusted EPS (in dollars)(1) |
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$(0.06) |
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$0.06 |
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Net additions to PP&E and intangible assets |
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$332 |
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$439 |
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Free cash flow usage(1) |
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$(490) |
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$ (808) |
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Results year-to-date |
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Six-month periods ended June 30 |
2016 |
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2015 |
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Revenues |
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$8,223 |
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$9,017 |
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EBIT |
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$(195) |
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$454 |
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EBIT margin |
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(2.4)% |
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5.0% |
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EBIT before special items |
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$236 |
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$463 |
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EBIT margin before special items |
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2.9% |
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5.1% |
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EBITDA before special items |
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$423 |
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$674 |
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EBITDA margin before special items |
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5.1% |
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7.5% |
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Net income (loss) |
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$(628) |
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$225 |
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Diluted EPS (in dollars) |
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$(0.32) |
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$0.11 |
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Adjusted net income (loss) |
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$(117) |
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$315 |
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Adjusted EPS (in dollars) |
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$(0.09) |
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$0.15 |
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Net additions to PP&E and intangible assets |
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$626 |
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$818 |
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Free cash flow usage |
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$(1,240) |
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$(1,553) |
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As at |
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June 30, 2016 |
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December 31, 2015 |
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Available short-term capital resources(2) |
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$4,355 |
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$4,014 |
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All amounts in this press release are in U.S. dollars unless otherwise indicated. |
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Amounts in tables are in millions except per share amounts, unless otherwise indicated. |
Bombardier reported consolidated revenues of $4.3 billion in the quarter and $8.2 billion for the first six-month period, relative to $4.6 billion and $9.0 billion for the same periods last year, explained for the most part by the planned reduction in business aircraft revenues. EBIT before special items was $106 million and $236 million respectively for the quarter and year-to-date, as margin improvements at Business Aircraft and Transportation were offset by the production ramp-up effect of the C Series, as it entered into service. Improved free cash flow usage for the first six months of the year and the completion of the equity investment by the Government of Québec (through Investissement Québec) have resulted in pro forma liquidity of $4.9 billion as at June 30, 2016. These results place Bombardier on track to meet its full year guidance of revenues between $16.5 billion and $17.5 billion, EBIT between $200 million and $400 million, and free cash flow usage between $1.0 billion and $1.3 billion.
Segmented results and highlights
Transportation
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Results of the quarter |
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Three-month periods ended June 30 |
2016 |
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2015 |
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Variance |
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Revenues |
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$1,964 |
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$2,091 |
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(6)% |
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Order intake (in billions of dollars) |
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$2.1 |
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$2.0 |
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5% |
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Book-to-bill ratio(5) |
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1.1 |
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1.0 |
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0.1 |
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EBIT |
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$87 |
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$115 |
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(24)% |
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EBIT margin |
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4.4% |
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5.5% |
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(110) bps |
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EBIT before special items |
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$124 |
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|
115 |
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8% |
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EBIT margin before special items |
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6.3% |
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5.5% |
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80 bps |
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EBITDA before special items |
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$149 |
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$139 |
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7% |
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EBITDA margin before special items |
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7.6% |
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6.6% |
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100 bps |
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Net additions to PP&E and intangible assets |
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$29 |
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$21 |
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38% |
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As at |
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June 30, 2016 |
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December 31, 2015 |
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Order backlog (in billions of dollars) |
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$29.8 |
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$30.4 |
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(2)% |
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- Transportation had a solid quarter as its EBIT margin before special items improved by 80 basis points to 6.3%. Our operational transformation is gaining traction, driven by procurement savings and functional cost optimization.
- Transportation has won several orders across various regions for established rolling stock platforms in the second quarter of 2016 and, in line with our strategy, increased the share of services contracts in the order backlog.
