The Nation Newspaper

Tag: Bombardier

  • Bombardier earnings beat on demand for business jets

    Canada’s Bombardier Inc topped analysts’ forecasts for quarterly earnings last Thursday, helped by its business jet unit, which benefited from demand for aftermarket services and higher-priced, large-cabin corporate planes, sending shares up 9.8 percent in early trading.

    The results come as the Montreal-based plane and train manufacturer nears the end of a five-year turnaround, which followed a series of heavy investments aimed at launching two planes that drove the company to the brink of bankruptcy in 2015.

    The company is counting on its recently-launched Global 7500 business jet, which is sold-out through 2021, to help lift annual revenue by 10 per cent this year and to over $20 billion by 2020.

    Still, quarterly revenue from Bombardier’s dominant transportation unit that makes rail cars and equipment, fell nearly 11 per cent to $2.16 billion as it faced delays in fulfilling a handful of contracts.

    Bombardier replaced the head of its Berlin-based transportation unit earlier this month.

    Chief Executive Alain Bellemare said the company was making “significant improvements” toward resolving the contracts, which he said would mostly be completed this year. He told analysts that there was no “systemic issue” in the division.

    “BT is a very strong franchise and our ability to win is solid,” Bellemare said.

    Bombardier reaffirmed its 2019 and 2020 guidance, reassuring investors fearful about the rail unit’s performance.

    “We had some concern there could be delays in 2019 cash recoveries from the unit,” said AltaCorp analyst Chris Murray.

    Bombardier also said a Quebec pension fund’s minority stake in its transportation unit would increase by 2.5 per cent to 30 per cent.

    Chief Financial Officer John Di Bert stressed that there was no “urgency” to buy back the stake acquired by the fund for $1.5 billion in 2015, although Bombardier now has the option to do so.

    Revenue from sales of business jets rose more than three per cent to $1.5 billion in the final quarter of 2018, Bombardier said.

    The company’s quarterly net profit overall reached $55 million, compared with a $188 million net loss a year earlier when it made heavy investments in its jet programs.

    Earnings before interest and taxation (EBIT), a closely watched measure of Bombardier’s profitability, also beat analysts’ estimates, rising to $342 million from $73 million a year earlier.

    Excluding one-time items, the company earned five cents per share, above analysts’ estimates of 2 cents, according to IBES data from Refinitiv.

    Bombardier shares rose 9.8 percent to C$2.24 at the market open in Toronto.

  • Bombardier axes 5,000 jobs globally

    Bombardier workers in Northern Ireland and the Midlands face uncertainty after the Canadian company announced 5,000 job cuts globally at the weekend.

    The struggling plane and train maker has not said where the cuts will be made over the next 12 to 18 months, but the bulk are expected to go in Canada.

    Bombardier employs 70,000 people, including 4,000 at four locations in Northern Ireland, mainly in Belfast.

    It also makes trains in Derby in the East Midlands, employing 1,600 there.

    Bombardier in Derby said there were no indications yet that the job cuts would have a significant impact in the city.

    A Bombardier UK spokesperson said: “We will take the necessary time to evaluate what this means for our Aerostructures and Engineering Services business. We will communicate with our employees in more detail over the coming weeks.”

    The GMB union, which represents Bombardier workers, said it was demanding answers from the company on behalf of its members.

    Michael Mulholland, GMB regional organiser, said: “Bombardier jobs are crucial to Belfast’s economy and GMB will fight tooth and nail to save them.”

    The firm will also sell its Q Series aircraft for $900million (£687million) and the de Havilland trademark for $300m.

    “We have set in motion the next round of actions necessary to unleash the full potential of the Bombardier portfolio,” said chief executive Alain Bellemare.

    Earlier this year, Bombardier sold a majority stake in its loss-making C-Series aircraft to Europe’s Airbus, with the plane being renamed the A220.

    The announcement came as Bombardier unveiled its third-quarter results, in which pre-tax profits doubled to $267million for the three months to September compared with the same period last year.

    Sales were down five per cent to $3.6billion, but revenue is expected to jump 10 per cent to at least $18billion next year.

    Mr Bellemare was brought in three years ago to shore up Bombardier, which was facing serious financial trouble with the C Series programme and had to be rescued by the Quebec government with a $1bn bailout.

  • Ethiopian Airlines, Bombardier sign $63m aircraft deal 

    Ethiopian Airlines and Bombardier Commercial Aircraft have signed a firm purchase agreement for two additional Q400 turboprop aircraft, that will bring the carrier’s Q400 aircraft fleet to 19 aircraft.

    The transaction is valued at approximately $63 million.

    Tewolde Gebremariam, Group Chief Executive Officer, Ethiopian Airlines, said: “We are continuously working to have the right fleet with agility, optimal range, load and passenger comfort which is critical for us to keep our leadership position in the market. The Q400 aircraft continues to be an integral part of our expansion strategy in Africa.Through our strategic partnerships with ASKY Airlines in Togo and Malawian Airlines in Malawi, the Q400 airliner has played a vital role in availing convenient connections, as well as increasing frequencies to support air travel growth in Africa and successfully create a missing link.”

    He added:  ”The Q400 aircraft is also our core fleet to our domestic and regional destinations, thereby ensuring excellent passenger experience, operational flexibility and economics. We continue to work with Bombardier to support and maintain the aircraft through our approved Q400 Authorised Service Facility and our Q400 aircraft simulator.”

    Also commenting on the development, Fred Cromer, President, Bombardier Commercial Aircraft, said: “The Q400 turboprop continues to make impressive headway in Africa and has proven its ruggedness and reliability in challenging operational  environments where its hot and high capability, jet-like speed and high rate of climb are significant assets.”

    Cromer added: “Some 69 Q400 aircraft are now in service with more than 20 operators on the continent, and we are delighted with Ethiopian Airlines’ continuing growth and impressive use of the aircraft to satisfy a wide variety of market requirements.”

    On his part, John Kassis, Vice President, Sales, Africa and the Middle East, Bombardier Commercial Aircraft, said: “Our  commitment to help Africa continue to expand its regional airline network with modern, economical, fuel-efficient and  environmentally sensitive aircraft remains a very high priority at Bombardier.

    “Our collaboration with operators in Africa encompasses the Dash 8/Q Series turboprops and the pioneering CRJ Series family of regional jets. Now, we are witnessing the unprecedented growth in Africa being undertaken by Ethiopian Airlines, ASKY and Malawian and the Q400  turboprop airliner continues to be a key contributor to this strategy.”

    In 2013, Ethiopian Airlines joined Bombardier’s global network of Authorised Service Facilities (ASFs) for commercial aircraft and performs line and heavy maintenance on Q400 aircraft at its facilities at Bole International Airport in Addis  Ababa.

    The ASF works with Bombardier’s maintenance network of service centres and ASFs, as well as with Bombardier’s network of parts hubs and depots, including the Johannesburg Parts Depot. A full-service Bombardier Regional Support Office is also located in Johannesburg.

  • Bombardier wins $5b S/African rail contract

    Bombardier wins $5b S/African rail contract

    Bombardier Inc. is one of four companies picked to supply a total of 1,064 locomotives to South Africa’s state-owned freight rail system.

    Transnet Freight Rail says the total contract is worth 50 billion rand, or about C$5.16-billion.

    Bombardier’s announcement didn’t disclose how much its share of the contract is worth but a spokesman said the company will supply 240 electric locomotives.

    Bombardier’s C-Series commercial jet took off on its first flight on September 16, last year in Montreal. Bombardier blew past BlackBerry as Canada’s top R&D spender.

    In total, Transnet said it’s buying 599 electric locomotives from Bombardier and CSR Zhuzhou Electric and 465 diesel engines will be supplied by General Electric and CNR Rolling Stock.

    Montreal-based Bombardier (TSX:BBD.B) said it will build all its Traxx Africa design locomotives in South Africa.

    “This implies investments in local manufacturing capacity, training and further improving the skills development of local employees, while working with local partners to achieve the same objectives,” Bombardier said in its statement.

    The Canadian company, which is more involved in passenger rail equipment and commuter systems than freight equipment, has been in South Africa since 1995.

    Bombardier and its consortium partners have been involved in providing trains and signalling systems for commuter services in the Johannesburg-Pretoria region and a modernisation of the rail control system in the main corridors around Durban, South Africa.

  • Bombardier, Ethiopian Airlines on intra-Africa travel

    Pierre Beaudoin, Group President and Chief Executive Officer of Bombardier Inc., held extensive discussions with Ethiopian CEO Tewolde Gebremariam and other senior executive management members regarding Ethiopian successful Q400 NextGen aircraft operations.

    The two companies are working to enhance their already strong and mutually beneficial relationship, in view of the expected high growth of regional intra-Africa travel in the coming years.

    With its fleet of 13 Q400 NextGen aircraft, Ethiopian is the largest operator of the Bombardier-manufactured Q400 aircraft in Africa, deploying the aircraft in domestic and regional operations. The airline recently phased-in five new Q400 NextGen aircraft that were the first outfitted with a dual-class configuration on Bombardier’s production line. With seven fully dedicated business class seats, a second lavatory and hot meal capability, Ethiopian is able to offer more services to its customers. Ethiopian plans to reconfigure its existing fleet of Q400 aircraft with a fully dedicated business class.

    “We are very happy with the performance of the Q400 NextGen aircraft in our domestic and regional operations.

    “The regional intra-Africa travel is set to boom in the coming years and we see a bright future for our relationship with Bombardier. In line with our Vision 2025 strategic roadmap, we will need more regional aircraft, not just to cater for our own fast-growing domestic and regional network, but also to realize our multi-hub strategy in Africa. Already, we have a strong regional partner in West Africa ASKY, which is also using the Q400 aircraft. We plan to build similar strong regional hubs in Southern and Central Africa,”said Mr Tewolde.

    “Having the right fleet with commonality, optimal range, load and passenger comfort will be critical to be competitive in this market. We look forward to working with Bombardier to expand our mutually beneficial relationship in the coming years,” added Mr. Gebremariam.

    “Africa has significant growth potential over the next 20 years and is an important part of Bombardier’s globalization strategy.

    “We are excited about the opportunities for expanding business and commercial aviation in the region and look forward to working with leading carriers like Ethiopian to develop the market fully,”Mr Beaudoin said.