Bombardier posts profit and narrows debt in Q3
Bombardier posted a profit of $27m and brought debt repayments to $873m for the year in the third quarter (Q3) of 2022.
The profit of $27m, yielding $0.20 per diluted share, was up from a loss of $377m ($3.98 per diluted share) in Q3 2021. Revenue for the quarter came to $1.46bn, up from $1.45bn in Q3 2021.
On an adjusted basis, Bombardier says it lost $0.10 per share in the latest quarter compared with $1.05 per share a year earlier.
Bombardier also continued to reduce its debt, with a $100m cash reduction. Order activity continued to be strong, marked with an increase in backlog and a unit book-to-bill of 1:3. The jet maker has full-year deliveries on track for more than 120 aircraft.
Éric Martel, president and CEO, Bombardier, said: “Our performance in the third quarter of 2022 demonstrated that our fundamentals are very strong, especially when it comes to profitability, free cash flow, liquidity, as well as continued and steady debt reduction from our balance sheet. We are progressing steadily and confidently toward our long-term objectives.”
A 20% year-over-year (YoY) increase in aftermarket revenues, rising to $372m, comes off a mix of increasing flight hours and service centre expansions, said the firm.
“Our most recent service centre inauguration in Florida strongly emphasises the important contribution of the growing aftermarket business to our bottom line,” said Martel.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rose to $210m, representing a 48% YoY improvement. Adjusted EBITDA margins rose 460 basis points YoY, from 9.8% to 14.4% Bombardier puts this largely down to strong sales of its Global 7500.
Backlog rose to $15bn in the quarter, an increase by $300m since the end of the first half of 2022. Free cash flow came to $52m in the quarter.
“While our team has certainly been opportunistic and made the most of the market momentum this quarter, we continue to focus on things we can control, which keeps us well equipped to face any market conditions that may be ahead of us,” said Martel.
The Canadian OEM also announced a new five-year committed secured revolving credit facility of $300m. Bart Demosky, executive vice president and chief financial, Bombardier said: “This syndicated revolver is another significant step we have made to continue strengthening our balance sheet. The incremental liquidity will further enhance our financial position and increase our operating flexibility.”
Bombardier Q3 results – at a glance
- Adjusted EBITDA for the third quarter rose to $210m
- A profit of $27m compared to a $377m loss in Q3 2021
- Revenues of $1.5bn
- A 20% year-over-year aftermarket increase to $372m
- Book-to-bill ratio of 1:3
- On track to deliver upwards of 120 aircraft in 2022.