May 03, 2018

Bombardier Reports First Quarter 2018 Results, Announces Sale of Downsview Property and plans for new Centre of Excellence for Global Aircraft

  • Revenues increase 12% year-over-year to $4B, highlighting top-line growth acceleration
  • Strong order activity drives backlog expansion at Transportation, Business Aircraft, and Commercial Aircraft
  • Consolidated EBITDA(1) and EBIT before special items(1) of $265M and $201M respectively; EBIT margin(2) increases to 5%
  • Free cash flow usage(1) of $721M, in line with plan and full year breakeven target
  • Airbus partnership expected to close before the end of the second quarter, ahead of schedule(3)
  • Entered into a definitive agreement to sell Downsview property to the Public Sector Pension Investment Board, increasing liquidity by more than $550M
  • New Centre of Excellence for Global business aircraft planned at Toronto Pearson International Airport

Bombardier (TSX: BBD.B) today reported its first quarter 2018 results, marked by strong top-line growth. Consolidated revenues reached $4.0 billion, a 12% increase over the same period last year, mainly driven by the ramping up of major projects at Transportation and improving market conditions at Business Aircraft.

“We continue to deliver on our financial commitments and make solid progress executing our growth programs and strategic initiatives,” said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc. “We’ve successfully reached the halfway point of our turnaround plan with a strengthened balance sheet and a clear focus on execution and growth.”

Steady order momentum at Transportation led to a book-to-bill ratio(4) of 1.0 for the quarter, while this segment's backlog grew to $35.7 billion. Business Aircraft's order backlog also increased to $14.3 billion in the first quarter. Subsequent to the end of the quarter, Commercial Aircraft announced that it has signed purchase agreements with Ethiopian Airlines for up to 15 Q400 aircraft and with American Airlines for up to 30 CRJ900 aircraft, increasing the CRJ Series and Q400 backlogs to over 50 aircraft each.

Bombardier's EBIT margin rose by 80 basis points to reach 5% for the first time since the launch of the Company's turnaround plan. This expansion was driven by strong revenue growth, including growth in aftermarket activities, and by operational improvements. EBITDA and EBIT before special items stood respectively at $265 million and $201 million for the quarter, reflecting strong earnings power.

Free cash flow usage of $721 million was in line with Bombardier's plan, as major rail projects continue to ramp up and the Global 7000 prepares for certification and entry in service later this year. Investments in working capital during the first quarter amounted to $594 million, mostly attributable to inventories and contract assets as we prepare for an acceleration of deliveries later this year. The Company remains on track to achieve free cash flow breakeven for the full year.

Bombardier also announced that it has entered into a definitive agreement to sell its Downsview property for gross proceeds of approximately $635 million to the Public Sector Pension Investment Board (PSP Investments), subject to customary closing conditions. The transaction is expected to close in the second quarter of 2018, increasing cash by more than $550 million net of transaction and other associated costs. Additionally, pursuant to a lease agreement with PSP Investments, Bombardier will continue to operate from Downsview for a period of up to three years following closing, with two optional one-year extension periods.

In parallel, Bombardier also entered into a letter of agreement with the Greater Toronto Airports Authority (GTAA) for a long-term lease of approximately 38 acres of property at Toronto Pearson International Airport on which Bombardier is planning to open a new centre of excellence and final assembly plant for its Global business jets. Details on this new leased facility will be provided at a future date.

“As part of Bombardier’s five-year turnaround plan, we have been reviewing our facilities worldwide to ensure we have the most efficient and cost effective operations necessary to support our growth objectives,” said Mr. Bellemare. “Today, we only use about 10 percent of a 370-acre site at Downsview and bear the entire cost of operating a 7,000-foot runway. So, we are very pleased to have reached agreements with PSP Investments and the GTAA. Together, they allow us to monetize an underutilized asset, further streamline and optimize our business aircraft operations, and will support further economic development and job growth in the Greater Toronto area.”

Selected Results (PDF)


Business Aircraft

Results (PDF)

  • During the first quarter of 2018, Business Aircraft returned to growth with a 9% revenue increase, reaching $1.1 billion through the delivery of 31 aircraft and an increase in aftermarket activities.
  • EBIT before special items also continued to trend upward, increasing by $16 million year-over-year, to 8.8%. This 20% increase in profitability was driven by an improving mix of aircraft sales and aftermarket services, and a strong discipline in managing costs.
  • The stronger order activity experienced in the final weeks of 2017 carried on into the first quarter, driving backlog growth to $14.3 billion.
  • The Global 7000 aircraft continued to perform extremely well and to exhibit a high level of reliability towards its expected entry into service during the second half of 2018. On April 15, 2018, Bombardier revealed that the Global 7000 business jet now boasts an outstanding range of 7,700 nautical miles, connecting more city pairs than any other business aircraft. The Global 7000 aircraft is now the largest and the longest range business jet ever built, and is able to fly a full 300 nautical miles farther than initial commitment.
  • In the first quarter, Business Aircraft continued to grow its aftermarket portfolio and announced a suite of new products that are available for retrofit, addressing market demand for cabin and cockpit upgrades as well as regulatory compliance among Bombardier’s large installed base of 4,700 jets.

Commercial Aircraft

Results (PDF)

  • The C Series aircraft ramp-up continues to progress, with 5 deliveries during the first quarter. There are currently 31 C Series aircraft in service with Swiss International Air Lines (Swiss), Air Baltic Corporation AS (airBaltic), and Korean Air Lines.
  • Nearly all regulatory approvals have been obtained for the announced partnership with Airbus for the C Series aircraft. Completion of the transaction is currently expected before the end of the second quarter of 2018, ahead of originally planned. With the recent increase in Bombardier’s participation in CSALP to 65%, the Corporation is expected to own approximately 33% of the same entity following the closing of the transaction with Airbus.
  • We also delivered 6 CRJ Series and 2 Q400 aircraft during the quarter, in line with our lower production output for the year.
  • Subsequent to the end of the quarter, we announced that we have signed purchase agreements with Ethiopian Airlines for up to 15 Q400 aircraft and with American Airlines for up to 30 CRJ900 aircraft, increasing the CRJ Series and Q400 backlogs to over 50 aircraft each.

Aerostructures and Engineering Services

Results (PDF)


Results (PDF)

  • Revenues in the first quarter continued to grow, increasing by 21% year-over-year (or 10% excluding currency impact) to $2.4 billion, driven by the ramp-up of key projects. Revenues increased across all segments, comprising rolling stock and systems, services and signalling.
  • The major project ramp-up phase initiated mid-2017 continued in the early months of 2018, building working capital to support the increase in production to meet an acceleration of deliveries expected later during the year.
  • EBIT before special items increased to $189 million in the first quarter, continuing to trend at or above an 8.0% margin.
  • Supporting future growth, our order intake reached $2.3 billion in the first quarter, bringing our book-to-bill ratio(4) to 1.0 for the period, and our backlog to $35.7 billion. Orders were signed across geographies including Europe, North America and Asia-Pacific, and include significant contract extensions and exercise of options by customers. In addition, the majority of new orders were in support of our strategy to re-use existing technologies, increasing our ability to leverage recent investments and grow margins.

About Bombardier

With over 69,500 employees across four business segments, Bombardier is a global leader in the transportation industry, creating innovative and game-changing planes and trains. Our products and services provide world-class transportation experiences that set new standards in passenger comfort, energy efficiency, reliability and safety.

Headquartered in Montreal, Canada, Bombardier has production and engineering sites in 28 countries across the segments of Transportation, Business Aircraft, Commercial Aircraft and Aerostructures and Engineering Services. Bombardier shares are traded on the Toronto Stock Exchange (BBD). In the fiscal year ended December 31, 2017, Bombardier posted revenues of $16.2 billion. News and information are available at or follow us on Twitter @Bombardier.

Bombardier, CRJ900,CRJ Series,C Series, Global, Global 7000 andQ400 are trademarks of Bombardier Inc. or its subsidiaries.

For Information

Simon Letendre
Senior Advisor, Media Relations and Public Affairs
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

bps: basis points

nmf: information not meaningful

  1. Non-GAAP financial measures. See Caution regarding non-GAAP measures at the end of this press release.
  2. Margin refers to EBIT before special items or EBIT margin before special items. Non-GAAP financial measures. See Caution regarding non-GAAP measures at the end of this press release.
  3. See the forward-looking statements disclaimer and each reportable segment’s Guidance and forward-looking statements section in the 2017 Financial Report for details regarding the assumptions on which the guidance is based.
  4. Defined as new orders over revenues.
  5. Due to the adoption of IFRS 15, Revenue from contracts with customers. Refer to the Accounting and reporting developments section in Other in the Corporation’s MD&A for details regarding restatements of comparative period figures.
  6. Defined as cash and cash equivalents plus the amount available under the revolving credit facilities.
  7. Following the anticipated closing of our C Series partnership with Airbus, the assets and liabilities of the C Series aircraft program are presented under Assets held for sale. Refer to the strategic partnership section in Commercial Aircraft, Note 11 - Cash and cash equivalent and Note 19 - Assets held for sale in the Corporation's Consolidated financial statements for more details on the transaction as well as the accounting treatment as at March 31, 2018.
  8. Defined as net orders received over aircraft deliveries, in units.


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 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 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.

Reconciliations to most comparable IFRS measures (PDF)


This press release includes forward-looking statements, which may involve, but are not limited to: statements with respect to our 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 our business and operations; available liquidities and ongoing review of strategic and financial alternatives; the completion, anticipated timing of the transaction with Airbus SE (Airbus) described herein and the receipt of regulatory and other approvals required with respect to this transaction and the anticipated timing thereof; the governance, funding and liquidity of C Series Aircraft Limited Partnership (CSALP); the impact and expected benefits of the transaction with Airbus described herein, on our operations, infrastructure, capabilities, development, growth and other opportunities, geographic reach, scale, footprint, financial condition, access to capital and overall strategy; and the impact of such transaction on our balance sheet and liquidity position.

Forward-looking statements can generally be identified by the use of forward-looking terminology such as “may”, “will”, “shall”, “can”, “expect”, “estimate”, “intend”, “anticipate”, “plan”, “foresee”, “believe”, “continue”, “maintain” or “align”, the negative of these terms, variations of them or similar terminology. Forward-looking statements are presented for the purpose of assisting investors and others in understanding certain key elements of our current objectives, strategic priorities, expectations and plans, and in obtaining a better understanding of our business and anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes.

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 our actual results in future periods to differ materially from forecast results set forth in forward-looking statements. While management considers these assumptions to be reasonable and appropriate based on information currently available, there is risk that they may not be accurate. The assumptions underlying the forward-looking statements made in this press release in relation to the transaction with Airbus discussed herein include the following material assumptions: the satisfaction of all conditions of closing and the successful completion of the transaction within the anticipated timeframe, including receipt of regulatory and other approvals; the fulfillment and performance by each party of its obligations pursuant to the transaction agreement and future commercial agreements and absence of significant inefficiencies and other issues in connection therewith; the realization of the anticipated benefits and  synergies of the transaction in the timeframe anticipated; our ability to continue with our current funding plan of CSALP and to fund, if required, any cash shortfalls; adequacy of cash planning and management and project funding; and the accuracy of our assessment of anticipated growth drivers and sector trends. For additional information with respect to the assumptions underlying the forward-looking statements made in this press release, refer to the Strategic Priorities and Guidance and forward-looking statements sections in Overview, Business Aircraft, Commercial Aircraft, Aerostructures and Engineering Services and Transportation in the MD&A of our financial report for the fiscal year ended December 31, 2017.

With respect to the transaction with Airbus discussed herein specifically, 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 the failure to receive or delay in receiving regulatory or other approvals or otherwise satisfy the conditions to the completion of the transaction or delay in completing the transaction and uncertainty regarding the length of time required to complete the transaction; changes in the terms of the transaction; the failure by either party to satisfy and perform its obligations pursuant to the transaction agreement and future commercial agreements and/or significant inefficiencies and other issues arising in connection therewith; the impact of the announcement of the transaction on our relationships with third parties, including commercial counterparties, employees and competitors, strategic relationships, operating results and businesses generally; the failure to realize, in the timeframe anticipated or at all, the anticipated benefits and synergies of the transaction; our ability to continue with  our current funding plan of CSALP and to fund, if required, the cash shortfalls; inadequacy of  cash planning and management and  project  funding. Certain other 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 “Brexit”, the financial condition of the airline industry, business aircraft customers, and the rail industry; trade policy (including potential changes to or the termination of the existing North American Free Trade Agreement between Canada, the U.S. and Mexico currently in discussion); increased competition; political instability and force majeure events or natural disasters), 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 and fixed-term commitments and production and project execution; pressures on cash flows and capital expenditures based on project-cycle fluctuations and seasonality; our ability to successfully implement and execute our strategy and transformation plan; doing business with partners; product performance warranty and casualty claim losses; regulatory and legal proceedings; environmental, health and safety risks; 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; substantial existing debt and interest payment requirements; certain restrictive debt covenants and minimum cash levels; 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 MD&A of our financial report for the fiscal year ended December 31, 2017.

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. Other risks and uncertainties not  presently known to us or that we presently believe are not material could also cause actual results or events to differ materially from those expressed or implied in our forward-looking statements. In addition, there can be no assurance that the proposed transaction with Airbus will occur or that the anticipated strategic benefits and operational, competitive and cost synergies will be realized in their entirety, in part or at all. The forward-looking statements set forth herein reflect management’s expectations as at the date of this report and are subject to change after such date. Unless otherwise required by applicable securities laws, we expressly disclaim any intention, and assume 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.

The Global 7000 and Global 8000 aircraft program is currently in development, and as such is subject to changes in family strategy, branding, capacity, performance, design and/or systems. All specifications and data are approximate, may change without notice and are subject to certain operating rules, assumptions and other conditions. This document does not constitute an offer, commitment, representation, guarantee or warranty of any kind.