Embraer Q1 2022 deliveries down on 2021, but ‘on plan’

Embraer’s delivery of eight executive aircraft, including six light and two mid-size jets, in the first quarter (Q1) 2022, was “equal to plan”, according to the OEM. Deliveries were below Q1 2021 after almost one month of production shut down due to a system reintegration in its commercial segment in January.

Sales continued to be strong in the quarter, the book-to-bill ratio remains above 2.5 to 1, the highest in the industry, claimed the firm. Growth in the light and mid-sized business jet segments also continues.

For Embraer as a whole, firm order backlog for Q1 2022 was $17.3bn, the highest quarter backlog since Q2 2018.

Executive Aviation revenues were $89.9m in Q122, which is 41% lower year-year (YoY), driven by a predicted delivery decrease of 38% compared with Q1 2021. Gross margin from the executive segment came in 18.7%, up from the 6.2% reported in Q1 2021.

Company revenues were down 26% compared with the same period last year, totalling $600.9m in the quarter. However, the firm’s consolidated gross margin of 20.1% was more than double the 9.5% reported in Q1 2021.

Adjusted earnings before interest and tax (EBIT) and earnings before interest, tax, depreciation and amortisation (EBITDA) were $27m and $13.2m, respectively. Those yielded an adjusted EBIT margin of -4.5% and adjusted EBITDA margin of 2.2%. Negative adjusted EBIT in Q1 2022 was partly driven by lower deliveries in the executive segment, said Embraer.

Free cash flow (FCF) in Q122 was a usage of $67.8m , representing a significant improvement compared with the $226.6m used in Q1 2021 and the best since Q1 2010.