April 28, 2016

Bombardier Announces Major C Series Order and Reports Financial Results for the First Quarter of 2016

  • Delta orders up to 125 C Series aircraft - Largest C Series order yet
  • Revenues of $3.9 billion; backlog of $58.9 billion
  • EBIT of $56 million; EBIT before special items(1) of $130 million
  • Recorded $112 million special charge for workforce optimization
  • Free cash flow usage of $750 million driven by cash outflows from operating activities of $456 million
  • Strong pro forma liquidity at $5.4 billion(2)
  1. See Caution regarding non-GAAP measures at the end of this press release.
  2. Pro forma liquidity reflects the revisions to the Corporation's revolving credit facilities effective in April 2016 and the expected gross proceeds of the investment from the Government of Québec in the C Series aircraft program.

(All amounts in this press release are in U.S. dollars unless otherwise indicated. Amounts in tables are in millions except per share amounts, unless otherwise indicated. EBIT is defined as earnings (loss) before financing expense, financing income and income taxes. EPS is defined as earnings (loss) per share attributable to equity holders of Bombardier Inc. This press release contains both IFRS and non-GAAP measures. Non-GAAP measures are defined and reconciled to the most comparable IFRS measures in the Corporation’s MD&A. See Caution regarding non-GAAP measures at the end of this press release.)

Bombardier (TSX: BBD.B) today reported its financial results for the first quarter ended March 31, 2016.

"Our turnaround plan is gaining traction. We delivered on our commitments for the first quarter and we remain on track to achieve both our 2016 guidance and 2020 goals. Our decisive actions to improve our operations and business model across all our businesses are starting to pay off," said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc.

Bombardier also announced today that Atlanta-based Delta Air Lines, Inc. (Delta) has placed a firm order for 75 CS100 aircraft with options for an additional 50 CS100 aircraft. Based on the list price, the firm order is valued at approximately $5.6 billion. Deliveries of the state-of-the-art aircraft to Delta are scheduled to begin in 2018. As a result of this order, the program is expected to enter into service with a backlog of more than 300 aircraft or up to 800 aircraft including all options and commitments.(1)

  1. The other agreements consist of conditional orders, letters of intent, options and purchase rights.

"We are very proud to welcome Delta as a C Series customer and to expand our partnership with such a prestigious airline. Given Delta’s position as one of the world’s largest and most respected airlines, this deal is a strong endorsement of theC Series as the best performing aircraft in the 100-150 passenger class. The addition of Delta to our marquee C Seriescustomer list gives us tremendous momentum as we approach entry-into-service this summer," concluded Mr. Bellemare.

Selected results (PDF)


Business Aircraft

Highlights (PDF)

  • Performance on revenues and deliveries was as anticipated for the first quarter of 2016, reflecting the proactive decision to reduce production rates.
  • Strong sales activity during the period yielded net orders for 40 aircraft, with a book-to-bill ratio of 1.3. This includes a firm order for 20 Challenger 350 aircraft from an undisclosed customer, valued at $534 million at list price.
  • EBIT margin before special items was essentially preserved compared to the same period last year, despite lower volumes, reflecting the positive impact of Bombardier's business model enhancements and transformation activities. Special items related to restructuring charges and decreased by $6 million compared to the same period last year.
  • In March 2016, the Challenger 650 aircraft received full type certification from the European Aviation Safety Agency. The aircraft received type certification from Transport Canada and the Federal Aviation Administration in November 2015 and entered into service in the fourth quarter of 2015.

Commercial Aircraft

Highlights (PDF)

  • Production for the C Series aircraft program is accelerating, diluting the EBIT margin as planned.
  • During the first quarter of 2016, free cash flow usage related to the C Series aircraft program amounted to approximately $200 million and remains in line with our target of $1.0 billion free cash flow usage for the program in 2016.
  • Recent significant agreements solidified the C Series aircraft program in the 100- to 150-seat category.
    • Subsequent to the quarter, in April 2016, Bombardier signed a firm order with Delta for 75 CS100 aircraft with options for an additional 50 CS100 aircraft. Based on list price, the firm order is valued at approximately $5.6 billion.
    • In February 2016, the Corporation signed a Letter of Intent with Air Canada and in the second quarter of 2016, Bombardier expects to sign a firm purchase agreement for 45 CS300 aircraft with options for an additional 30 CS300 aircraft, including conversion rights to the CS100 aircraft. Based on list price of theCS300 aircraft, the firm order is valued at $3.8 billion.
    • Subsequent to the quarter, Air Baltic Corporation AS converted its remaining seven options to firm orders for the CS300 aircraft. Based on list price, the firm order is valued at $506 million.
  • These anticipated 127 firm orders are valued at $9.9 billion, based on list prices. They build confidence and reinforce Bombardier's five-year plan for the C Series aircraft program. In conjunction with the closing of these firm purchase agreements, Bombardier will record an onerous contract provision of approximately $500 million as a special item in the second quarter of 2016. As a result of these orders, the program is expected to enter into service with a firm order backlog of more than 300 aircraft and up to 800 aircraft including options and other agreements.(1)The Corporation remains on target to invest $2.0 billion and achieve a break-even free cash flow for the program by 2020.
  • Bombardier continues to prepare for the EIS of the CS100 aircraft, with the first aircraft to be delivered to Swiss International Air Lines in June 2016.
  • Subsequent to the end of the first quarter, Chorus Aviation Inc. signed a firm purchase agreement for fiveCRJ900 aircraft. The order also includes purchase rights for an additional five CRJ900 aircraft. Based on the list price of the CRJ900 aircraft, the firm order is valued at $229 million.
  • The other agreements consist of conditional orders, letters of intent, options and purchase rights.  

Aerostructures and Engineering Services

Highlights (PDF)

  • The level of intersegment activity is increasing, as the C Series aircraft program ramps-up towards full production. Aerostructures and Engineering Services manufactures cockpits and all-composite wings for the CS100 and CS300 aircraft.


Highlights (PDF)

  • EBIT margin before special items increased to 6.1% in the first quarter.  From an operational perspective, continued improvements in working capital management are positively impacting free cash flow generation, and delaying recognition of certain costs and therefore delaying revenue recognition under long-term contract accounting. Special items represent restructuring charges of $87 million related to the workforce optimization announced in February 2016 and a foreign exchange loss of $5 million related to the reorganization of Transportation under one holding entity necessary to facilitate the placement of a minority stake in Transportation.
  • The Corporation closed the sale to the CDPQ of a $1.5-billion investment in convertible shares representing a 30% stake in Bombardier Transportation (Investment) UK LTD (BT Holdco), which following the completion of a corporate reorganization, owns essentially all of the assets and liabilities of Bombardier’s Transportation business segment. BT Holdco will continue to be controlled by Bombardier Inc. and consolidated in its results.
  • On February 12, 2016, as part of TransEd Partners consortium, Bombardier signed a contract for the Valley Line LRT in Edmonton, Canada. The Corporation's scope is valued at $280 million.

Reconciliation of segment to consolidated results (PDF)

About Bombardier

Bombardier is the world’s leading manufacturer of both planes and trains. Looking far ahead while delivering today, Bombardier is evolving mobility worldwide by answering the call for more efficient, sustainable and enjoyable transportation everywhere. Our vehicles, services and, most of all, our employees are what make us a global leader in transportation.

Bombardier is headquartered in Montréal, Canada. Our shares are traded on the Toronto Stock Exchange (BBD) and we are listed on the Dow Jones Sustainability North America index. In the fiscal year ended December 31, 2015, we posted revenues of $18.2 billion. News and information are available at  bombardier.com or follow us on Twitter  @Bombardier.

Bombardier, ChallengerChallenger 350Challenger 650, CRJCRJ900, CS100, CS300, C Series and The Evolution of Mobility are trademarks of Bombardier Inc. or its subsidiaries.

For Information

Isabelle Rondeau
Director, Communications
Bombardier Inc.
+514 861 9481
Patrick Ghoche
Vice President, Investor Relations
Bombardier Inc.
+514 861 5727

The Management’s Discussion and Analysis and the interim consolidated financial statements are available at ir.bombardier.com.


This press release includes forward-looking statements, which may involve, but are not limited to: statements with respect to the Corporation’s objectives, guidance, targets, goals, priorities, market and strategies, financial position, beliefs, prospects, plans, expectations, anticipations, estimates and intentions; general economic and business outlook, prospects and trends of an industry; expected growth in demand for products and services; product development, including projected design, characteristics, capacity or performance; expected or scheduled entry-into-service of products and services, orders, deliveries, testing, lead times, certifications and project execution in general; competitive position; the expected impact of the legislative and regulatory environment and legal proceedings on the Corporation’s business and operations; available liquidities and ongoing review of strategic and financial alternatives; the completion of the investment by the Government of Québec in the C Series aircraft program (the C Series Investment) and the use of proceeds therefrom; the effects of the C Series Investment and of the private placement of a minority stake in Transportation to the CDPQ (the CDPQ Investment and, with the C Series Investment, the Investments) on the range of options available to us, including regarding our participation in future industry consolidation; the capital and governance structure of the Transportation segment following the CDPQ Investment, and of the Commercial Aircraft segment following the C Series Investment; the impact and expected benefits of the Investments on our operations, infrastructure, opportunities, financial condition, access to capital and overall strategy; and the impact of the sale of equity on our balance sheet and liquidity position. The implementation of the Share Consolidation is subject to a number of conditions, including but not limited to, Toronto Stock Exchange approval and shareholder approval, and subject to the Board of Directors’ authority, notwithstanding approval of the Share Consolidation by shareholders, to determine in its discretion not to proceed with the Share Consolidation, without further approval or action by, or prior notice to, shareholders. There can be no assurance that the Share Consolidation will be implemented as proposed or at all, or as to the timing thereof, or that the Share Consolidation will result in the contemplated initial post-consolidation share price of Class A Shares or Class B Subordinate Voting Shares.

Forward-looking statements can generally be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “anticipate”, “plan”, “foresee”, “believe”, “continue”, “maintain” or “align”, the negative of these terms, variations of them or similar terminology. By their nature, forward-looking statements require management to make assumptions and are subject to important known and unknown risks and uncertainties, which may cause actual results in future periods to differ materially from forecast results. While management considers their assumptions to be reasonable and appropriate based on information currently available, there is risk that they may not be accurate.

Certain factors that could cause actual results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, risks associated with general economic conditions, risks associated with our business environment (such as risks associated with the financial condition of the airline industry, of business aircraft customers, and of the rail industry; trade policy; increased competition; political instability and force majeure), operational risks (such as risks related to developing new products and services; development of new business; the certification and homologation of products and services; fixed-price commitments and production and project execution; pressures on cash flows based on project-cycle fluctuations and seasonality; our ability to successfully implement our strategy and transformation plan; doing business with partners; product performance warranty and casualty claim losses; regulatory and legal proceedings; the environment; dependence on certain customers and suppliers; human resources; reliance on information systems; reliance on and protection of intellectual property rights; and adequacy of insurance coverage), financing risks (such as risks related to liquidity and access to capital markets; retirement benefit plan risk; exposure to credit risk; existing debt and interest payment requirements; certain restrictive debt covenants; financing support provided for the benefit of certain customers; and reliance on government support), market risks (such as risks related to foreign currency fluctuations; changing interest rates; decreases in residual values; increases in commodity prices; and inflation rate fluctuations). For more details, see the Risks and uncertainties section in Other in the Management’s Discussion and Analysis (MD&A) of the Corporation’s financial report for the fiscal year ended December 31, 2015. Certain important assumptions by management in making forward-looking statements include, but are not limited to: that ongoing due diligence investigations by the Government of Québec will not identify any materially adverse facts or circumstances; and the satisfaction of all conditions to the completion of the C Series Investment, including the receipt of any required third party, regulatory and other approvals. For additional information with respect to the assumptions underlying the forward-looking statements made in this press release, refer to the Guidance and forward-looking statements sections in the MD&A of the Corporation’s financial report for the fiscal year ended December 31, 2015. There can be no assurance that the C Series Investment will be undertaken or completed in whole or in part, or of the timing, size and proceeds of any such transaction, which will depend on a number of factors.

Readers are cautioned that the foregoing list of factors that may affect future growth, results and performance is not exhaustive and undue reliance should not be placed on forward-looking statements. The forward-looking statements set forth herein reflect management’s expectations as at the date of this press release and are subject to change after such date. Unless otherwise required by applicable securities laws, the Corporation expressly disclaims any intention, and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement.


This press release is based on reported earnings in accordance with International Financial Reporting Standards (IFRS). Reference to generally accepted accounting principles (GAAP) means IFRS, unless indicated otherwise. This press release is also based on non-GAAP financial measures including EBITDA, EBIT before special items and EBITDA before special items, adjusted net income, adjusted earnings per share and free cash flow. These non-GAAP measures are mainly derived from the interim consolidated financial statements but do not have standardized meanings prescribed by IFRS; therefore, others using these terms may define them differently. Management believes that providing certain non-GAAP performance measures, in addition to IFRS measures, provides users of our interim financial report with enhanced understanding of our results and related trends and increases the transparency and clarity of the core results of our business. Refer to the Non-GAAP financial measures and Liquidity and capital resources sections in Overview and each reporting segments' Analysis of results sections in the Corporation’s MD&A for definitions of these metrics and reconciliations to the most comparable IFRS measures.