Bombardier 2Q revenue surges 31% on higher aircraft sales
Canadian aerospace manufacturer Bombardier reported revenue of $2.2bn in the second quarter of 2024, up 31% year-over-year from $1.7bn in the same period last year owing to an increase in aircraft deliveries and better selling prices.
Revenue breakdown showed the manufacturing segment contributed $1.7bn (up $448m YoY) to the total revenue, while the remainder $507m (up $79m YoY) came from services segment.
The company delivered 20 medium and 19 large business aircraft during the 2Q 2024, up from 15 and 14 respectively in the second quarter of 2023. Overall, during the six months, the company has so far delivered 59 business jets (32 medium and 27 large) against a target of 150-155 announced at the start of 2024.
However, despite higher sales and deliveries, at the end of second quarter, the company’s backlog stayed flat at $14.9bn on unit book-to-bill ratio of 1.0x relative to first quarter.
“Revenue and deliveries for the second quarter saw impressive growth. We’re up for more than 30% year-over-year in both of those columns,” said Matti Lehmus, CEO, Bombardier. “We are very clearly outperforming our peers when it comes to consistency and predictability on aircraft deliveries.”
However, Lehmus warned that the ‘supply chain is still a headwind.’ But he said the company is working closely with engine makers to ensure production timelines still are within the targets.
“We’ve delivered impressive double-digit growth in deliveries, revenues, services, and profitability. We’re on track to meeting our full year guidance, and we have strong momentum as we enter the second half of the year,” added Bart Demosky, Bombardier’s chief financial officer.
“Our business is continuing to grow rapidly with Q2 revenues increasing by almost a third versus 2023. Our services revenues crossed above the $500m mark for the first time, and that’s a milestone that we’ve been talking about for the past three years, putting us in the right place to reach our 2025 services revenue objective of $2bn, but doing it one year early.”
Despite better prices and higher sales supporting topline growth, the company’s gross margin shrunk by 190 basis points to 20.2% during the second quarter. In addition, the company’s EBIT margin also declined 590bps to 8.7%.
On the liquidity front, the company has no long-term debt maturing until 2026. However, it does have a large debt repayment of $983m due in 2027.
However, the company said that its current liquidity of $1.3bn is adequate in the short-term. But it added that it will “continue to opportunistically refinance or deploy excess liquidity towards debt pay down.”
Bombardier is targeting 150-155 business jet deliveries while growing revenue by $400-600m to $8.6bn from 2023’s $8bn in 2024.
