August 05, 2016

Bombardier Reports Second Quarter 2016 Results

  • Reaffirms full year guidance for 2016
  • Reports margin expansion at Business Aircraft and Transportation for Q2
  • Improved cash performance in line with turnaround plan
  • C Series enters service; begins revenue generation

Bombardier (TSX: BBD.B) today reported its second quarter 2016 results and reaffirmed its full year guidance.

“We continue to make very good progress executing our turnaround plan,” said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc. “We delivered on our financial commitments, achieved our program milestones and positioned Bombardier to meet both our full year guidance and 2020 goals.”

Highlighting the company’s recent progress is the C Series entry-into-service and the certification of the CS300 aircraft - the larger version of the C Series. These significant milestones reflect the completion of the C Series’ development phase and transition into production ramp-up. As the industry's first clean-sheet designed narrow-body aircraft in nearly 30 years, the C Series offers the best passenger experience, environmental performance and operating costs in the 100- to 150-seat class.

“This was a pivotal quarter for the C Series as both variants are now certified and the program has begun generating revenue,” Bellemare continued. “Having firmly placed Bombardier on a path to profitable earnings growth and cash generation, we remain focused on delivering customer and shareholder value by improving productivity, executing flawlessly on our programs and applying a disciplined and proactive approach to our portfolio.”

Results of the Quarter (PDF)

Results Year-to-Date (PDF)

Bombardier reported consolidated revenues of $4.3 billion in the quarter and $8.2 billion for the first six-month period, relative to $4.6 billion and $9.0 billion for the same periods last year, explained for the most part by the planned reduction in business aircraft revenues. EBIT before special items was $106 million and $236 million respectively for the quarter and year-to-date, as margin improvements at Business Aircraft and Transportation were offset by the production ramp-up effect of the C Series, as it entered into service. Improved free cash flow usage for the first six months of the year and the completion of the equity investment by the Government of Québec (through Investissement Québec) have resulted in pro forma liquidity of $4.9 billion as at June 30, 2016. These results place Bombardier on track to meet its full year guidance of revenues between $16.5 billion and $17.5 billion, EBIT between $200 million and $400 million, and free cash flow usage between $1.0 billion and $1.3 billion.


Business Aircraft

Results of the Quarter (PDF)

  • In the first half of 2016, we delivered 73 aircraft and achieved a book-to-bill ratio of 1.0 validating the strategic decisions we took in 2015 to re-align aircraft supply to market demand. We also realized an improved EBIT margin before special items of 6.7% in what continued to be a challenging market environment.
  • As outlined in our latest 10-year forecast, we remain confident in the significant long-term growth potential of the industry primarily driven by wealth creation, globalization of trade and replacement demand.

Commercial Aircraft

Results of the Quarter (PDF)

  • The C Series aircraft program is transitioning from the development phase to the revenue-generating phase, a historic milestone as we bring to market the first clean-sheet designed narrow-body aircraft in nearly 30 years.
  • On June 29, 2016, we delivered the first CS100 aircraft to launch operator Swiss International Air Lines (SWISS). The aircraft achieved successful entry-into-service on July 15, 2016 with its maiden commercial flight taking passengers from Zurich to Paris.
  • Recent significant orders totalling 127 firm orders and 80 options from Delta, Air Canada and airBaltic solidified the C Series aircraft program in the 100- to 150-seat category. These firm orders are valued at $9.9 billion based on list prices. The program entered into service with a firm order backlog above our target of 300 aircraft.
  • In the quarter, we signed a firm order for 10 CRJ900 aircraft with an undisclosed customer. Based on list price, the firm order is valued at $472 million.
  • On June 30, 2016, we closed the $1.0-billion investment by the Government of Québec (through Investissement Québec) in return for a 49.5% equity stake in a newly created limited partnership, the C Series Aircraft Limited Partnership (CSALP). We also received the first $500-million installment and the second $500-million installment is expected on September 1, 2016.
  • Free cash flow usage of approximately $470 million on a year-to-date basis, as we ramp-up production for the C Series aircraft, is on track to our full year target of $1.0 billion.
  • Subsequent to the end of the second quarter, we restructured the purchase agreement signed in 2013 with Ilyushin Finance Co. (IFC), a Moscow-based leasing company, to align with their current market needs. The firm order has been modified from 32 CS300 aircraft and options for an additional 10 CS300 aircraft to 20 CS300 aircraft and one Q400 aircraft with options for five additional Q400 aircraft.

Aerostructures and Engineering Services

Results of the Quarter (PDF)

  • The level of commercial aircraft intersegment revenue is driven more and more by the C Series aircraft program, as it ramps up towards full production.


Results of the Quarter (PDF)

  • Transportation had a solid quarter as its EBIT margin before special items improved by 80 basis points to 6.3%. Our operational transformation is gaining traction, driven by procurement savings and functional cost optimization.
  • Transportation has won several orders across various regions for established rolling stock platforms in the second quarter of 2016 and, in line with our strategy, increased the share of services contracts in the order backlog.

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 or follow us on Twitter  @Bombardier.

Bombardier, CRJCRJ900, CS100, CS300, C SeriesQ400 and The Evolution of Mobility are trademarks of Bombardier Inc. or its subsidiaries.

For Information

Simon Letendre
Advisor, 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

Reconciliation of segment to consolidated results (PDF)


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 section in Overview in the Corporation’s MD&A for definitions of these metrics and refer below for 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 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 receipt and use of the remaining investment by the Government of Québec in the C Series Aircraft Limited Partnership (the C Series Investment); 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. The Board of Directors has 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. At this time, no decision has been made by the Board of Directors and 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. 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.

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.