October 31, 2019

Bombardier Reports Third Quarter 2019 Results

  • Consolidated revenues of $3.7 billion, representing 8% organic growth(1)
  • Consolidated adjusted EBITDA(2)and adjusted EBIT(2)of $255 million and $159 million, respectively; $143 million of reported EBIT
  • Free cash flow usage(2)of $682 million, supporting Global 7500 and Transportation ramp-up; $557 million operating cash flow usage
  • Clear roadmap to full year revenues, earnings(4)and free cash flow guidance supported  by planned fourth quarter delivery schedules at Aviation and Transportation(3)

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.

Bombardier (TSX: BBD.B) today reported its third quarter 2019 financial results, highlighting continued progress on its turnaround.

Among its achievements in the third quarter, Bombardier obtained Transport Canada and European Aviation Safety Agency (EASA) certification for its new Global 5500 and Global 6500 aircraft, with the Global 6500 also entering service. Bombardier Transportation made steady progress addressing its challenging projects, while also growing and improving the quality of its backlog.

Bombardier’s consolidated revenues for the quarter were $3.7 billion, representing 8% organic growth year-over-year, driven mainly by a favourable delivery mix of large business aircraft and progress on rail projects. Order activity remained solid in the quarter, and the Company reported strong backlogs at Transportation and for business aircraft of $35.1 billion and $15.3 billion, respectively.

Consolidated adjusted EBITDA and adjusted EBIT for the quarter were $255 million and $159 million, respectively. Adjusted EBIT margin in Aviation was 6.0%, in line with expectations and driven by Global 7500 aircraft ramp-up and the dilutive effect of commercial aircraft activities. Adjusted EBIT margin in Transportation was 5.1%, reflecting a concentration of large, late-stage projects and planned investments in manufacturing and engineering capacity announced earlier this year. On a reported basis, EBIT for the quarter was $143 million.

Free cash flow usage was $682 million for the quarter, reflecting the intense ramp-up of the Global 7500 production and lower cash inflows associated with train deliveries and milestones payments that have moved into the fourth quarter. Cash flows usage from operating activities during the quarter was $557 million.

The Company continues to expect full-year free cash flow usage to be approximately $500 million, driven by seasonally strong fourth quarter cash flows, the acceleration of Global 7500 deliveries and the partial release of excess working capital at Transportation.(3) As we move beyond short-term challenges, Bombardier is positioned for 2020 earnings(3)growth and positive cash flow generation.(3)(5)

“We continue to make progress driving our turnaround,” said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc. “At Aviation, the recent certification of our new Global 5500 and Global 6500 aircraft, and the outstanding in-service performance of our new Global 7500, highlight the strength of our business jet franchise. At Transportation, we are turning the corner. We are making steady progress working through our legacy projects, giving us confidence in our ability to deliver stronger financial performance.”



Following the strategic formation of Bombardier Aviation, effective July 1, 2019, Business Aircraft, Commercial Aircraft and Aerostructures and Engineering Services are reported under Aviation. Prior periods have been restated to reflect this new reporting structure. The Corporation’s interest in Airbus Canada Limited Partnership (ACLP) is treated as a corporately held investment and therefore is not included in Aviation.

Aviation (PDF)

  • Revenues of $1.6 billion during the quarter reflect double-digit organic growth year-over-year (excluding the Q400 and training activities divestitures completed earlier this year), driven by the Global 7500, external aerostructures revenues and stronger aftermarket services.
  • Deliveries during the quarter totalled 37 aircraft, including 6 CRJ and 31 business aircraft. Revenue grew mainly because of a favourable mix of large business aircraft sales led by 2 Global 7500 deliveries and the entry into service of the first Global 6500 aircraft.
  • On September 24, 2019, the Global 5500 and Global 6500 aircraft were awarded Transport Canada Type Certification, followed by EASA certification. The Global 5500 and Global 6500 aircraft showcase the ingenuity of innovation by bringing value to customers with segment-leading ranges and reduced operating costs.
  • As the pace of deliveries accelerates into the fourth quarter, Aviation is on track to reach 175 to 180 aircraft deliveries for the full-year on revenues of approximately $8.0 billion(3).. Production ramp-up of the Global 7500 continues to make steady progress with an estimated 10 to 15 aircraft deliveries in the fourth quarter(3).
  • Order momentum remained healthy during the quarter for business aircraft, with backlog stable at an  industry-leading $15.3 billion. For the first nine months, business aircraft backlog increased by $1.0 billion.
  • Adjusted EBIT margin for the third quarter was 6.0% (6.2% EBIT margin), in line with expectations as the ramp-up of the Global 7500 aircraft and the dilutive effect of commercial aircraft activities weigh on Aviation margins. Year-to-date, adjusted EBIT margin was 7.6% (21.6% reported EBIT margin), tracking to full year margin guidance of 7.0%.(3)

Transportation (PDF)

  • Transportation is gradually turning the corner on large, legacy projects as it makes progress against key project milestones.
    • With deliveries increasing approximately 15% over the previous quarter, this progress positions the business to further accelerate the release of excess working capital starting in the fourth quarter and into 2020 and 2021.(3)
    • To achieve this result, we are nearing completion of software testing and homologation for U.K. projects while completing production and we continue driving stronger in-service reliability in Switzerland and Germany to trigger customer acceptance of trains in operation.
    • Longer term, the turnaround at Transportation is supported by the recent redeployment of resources, investments in additional capacity, and a strengthened management team, resting on a solid backlog and quality order intake. This drives our confidence in the long-term prospects of the business.
  • Revenues during the quarter totalled $2.2 billion, delivering 5% growth year-over-year, excluding currency translation, mainly coming from services. Transportation remains on track to the full year revenue guidance of approximately $8.75 billion,(3) assuming a 1.12 Euro to U.S. exchange rate.
  • Adjusted EBIT margin(3) for the quarter of 5.1% is in line with full year guidance of approximately 5.0%, reflecting a concentration of large, late-stage projects and includes the costs associated with planned investments in manufacturing and engineering capacity announced earlier this year. Reported EBIT margin for the quarter is 4.0%.
  • Backlog grew to $35.1 billion during the quarter, supported by $4.5 billion of order intake driving a book-to-bill ratio of 2.1. For the first nine months of the year, Transportation's order intake was $8.1 billion, with a strong mix of high re-use projects, services and signalling orders as well as significant call-offs. Improving the backlog mix by replacing legacy projects with lower-risk projects is key to return to stronger financial performance.
    • Highlighting the quarters’ order activity, Transportation is part of a consortium that was awarded a contract to supply and operate two monorail lines in Cairo, Egypt with its share valued at $2.64 billion. This award leverages Transportation's INNOVIA monorail platform through an integrated offering of rolling stock and systems, signalling and services solutions. This project re-uses the platform operating in Sao Paulo, Brazil, since 2014 and currently under construction in Bangkok, Thailand and Wuhu, China.

About Bombardier

With over 68,000 employees, 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 as well as a broad portfolio of products and services for the business aviation, commercial aviation and rail transportation markets. Bombardier shares are traded on the Toronto Stock Exchange (BBD). In the fiscal year ended December 31, 2018, Bombardier posted revenues of $16.2 billion US. The company is recognized on the 2019 Global 100 Most Sustainable Corporations in the World Index. News and information are available at bombardier.com or follow us on Twitter @Bombardier.

Bombardier, Challenger, CRJ, CRJ900, Global, Global 5500, Global 6500, Global 7500, INNOVIA and Learjet are trademarks of Bombardier Inc. or its subsidiaries.

For Information

Jessica McDonald
Advisor, Media Relations and Public Affairs
Bombardier Inc.
+514 861 9481
Patrick Ghoche
Vice President, Corporate Strategy and 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.

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  1. Excluding divestitures and currency translation impact.
  2. Non-GAAP financial measures. Refer to the Caution regarding Non-GAAP financial measures below for definitions of these metrics and reconciliations to the most comparable IFRS measures.
  3. See the forward-looking statements disclaimer at the end of this press release as well as the forward-looking statements section in Overview and the Guidance and forward-looking statements section in each reportable segment in the Corporation’s 2018 Financial Report for details regarding the assumptions on which the guidance is based.
  4. Defined as adjusted EBITDA and adjusted EBIT.
  5. Free cash flow for 2020 excludes cash flow from the CRJ program, as well as payments associated with CRJ retained liabilities such as credit and residual value guarantees.
  6. Refer to Note 2 - Changes in accounting policies, to our interim consolidated financial statements, for the impact of the adoption of IFRS 16, Leases. Under the modified retrospective approach adopted by the Corporation, 2018 figures are not restated.
  7. Defined as cash and cash equivalents plus the amount available under our revolving credit facilities.
  8. Including 32 firm orders for CRJ900 as of September 30, 2019 and 45 firm orders and 4 options for CRJ900 as of December 31, 2018.
  9. On May 31, 2019, the Corporation completed the previously announced sale of the Q Series aircraft program assets, including aftermarket operations and assets, to De Havilland Aircraft of Canada Limited (formerly Longview Aircraft Company of Canada Limited). 2 Q Series aircraft deliveries are included in comparative period of 2018.
  10. Ratio of new orders over revenues.
  11. Including share of income from joint ventures and associates amounting to $20 million for the three-month period ended September 30, 2019 ($22 million for the three-month period ended September 30, 2018).


This press release is based on reported earnings in accordance with IFRS and on the following non-GAAP financial measures:

Non-GAAP financial measures
Adjusted EBIT EBIT excluding special items. Special items comprise items which do not reflect the Corporation’s  core performance or where their separate presentation will assist users of the consolidated financial statements in understanding the Corporation’s results for the period. Such items include, among others, the impact of restructuring charges and significant impairment charges and reversals.
Adjusted EBITDA Adjusted EBIT plus amortization and impairment charges on PP&E and intangible assets.
Adjusted net income (loss) Net income (loss) excluding special items, accretion on net retirement benefit obligations, certain net gains and losses arising from changes in measurement of provisions and of financial instruments carried at FVTP&L and the related tax impacts of these items.
Adjusted EPS EPS calculated based on adjusted net income attributable to equity holders of Bombardier Inc., using the treasury stock method, giving effect to the exercise of all dilutive elements.
Free cash flow (usage) Cash flows from operating activities less net additions to PP&E and intangible assets.

Non-GAAP financial measures are mainly derived from the consolidated financial statements but do not have standardized meanings prescribed by IFRS. The exclusion of certain items from non-GAAP performance measures does not imply that these items are necessarily non-recurring. Other entities in our industry may define the above measures differently than we do. In those cases, it may be difficult to compare the performance of those entities to ours based on these similarly-named non-GAAP measures.

Prior to the first quarter of fiscal year 2019, the Corporation reported non-GAAP measures labelled “EBIT before special items” and “EBITDA before special items”. Beginning in the first quarter of fiscal year 2019, the Corporation changed the label of these non-GAAP measures to "adjusted EBIT" and "adjusted EBITDA", respectively, without making any change to the composition of these non-GAAP measures. The Corporation believes that this new label aligns better with broad market practice in its industry and better distinguishes these measures from the IFRS measurement "EBIT".

Adjusted EBIT, adjusted EBITDA, adjusted net income (loss) and adjusted EPS

Management uses adjusted EBIT, adjusted EBITDA, adjusted net income (loss) and adjusted EPS for purposes of evaluating underlying business performance. Management believes these non-GAAP earnings measures in addition to IFRS measures provide 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. Adjusted EBIT, adjusted EBITDA, adjusted net income (loss) and adjusted EPS exclude items that do not reflect our core performance or where their exclusion will assist users in understanding our results for the period. For these reasons, a significant number of users of the MD&A analyze our results based on these financial measures. Management believes these measures help users of MD&A to better analyze results, enabling better comparability of our results from one period to another and with peers.

Free cash flow (usage)

Free cash flow is defined as cash flows from operating activities less net additions to PP&E and intangible assets. Management believes that this non-GAAP cash flow measure provides investors with an important perspective on the Corporation’s generation of cash available for shareholders, debt repayment, and acquisitions after making the capital investments required to support ongoing business operations and long-term value creation. This non-GAAP cash flow measure does not represent the residual cash flow available for discretionary expenditures as it excludes certain mandatory expenditures such as repayment of maturing debt. Management uses free cash flow as a measure to assess both business performance and overall liquidity generation.

Reconciliations of non-GAAP financial measures to the most comparable IFRS financial measures are provided in the tables hereafter, except for the following reconciliations:

  • adjusted EBIT to EBIT – see the Results of operations tables in the reporting segments and Consolidated results of operations section of the Corporation’s MD&A for the quarter ended September 30, 2019.

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, anticipations and guidance in respect of various financial and global metrics and sources of contribution thereto, targets, goals, priorities, market and strategies, financial position, market position, capabilities, competitive strengths, credit ratings, 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; growth strategy, including in the business aircraft aftermarket business; 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; expectations regarding working capital recovery across late-stage Transportation projects; expectations regarding revenue and backlog mix; the expected impact of the legislative and regulatory environment and legal proceedings on the Corporation’s business and operations; strength of capital profile and balance sheet, creditworthiness, available liquidities and capital resources, expected financial requirements and ongoing review of strategic and financial alternatives; the introduction of productivity enhancements, operational efficiencies and restructuring initiatives and anticipated costs, intended benefits and timing thereof; the expected objectives and financial targets underlying our transformation plan and the timing and progress in execution thereof, including the anticipated business transition to growth cycle and cash generation; expectations and objectives regarding debt repayments, expectations and timing regarding an opportunistic redemption of CDPQ’s investment in BT Holdco; intentions and objectives for the Corporation’s programs, assets and operations; the pursuit of a divestiture of the Corporation’s operations in Belfast and Morocco, the anticipated benefits of any divestiture or other transaction resulting therefrom and their expected impact on the Corporation’s operations, infrastructure, opportunities, financial condition, business plan and overall strategy; the funding and liquidity of Airbus Canada Limited Partnership (ACLP); and the expected impact and intended benefits of the Corporation’s partnership with Airbus and investment in ACLP. As it relates to the sale of the CRJ aircraft program (the Pending Transaction), this press release also contains forward-looking statements with respect to: the expected terms, conditions, and timing for completion thereof; the respective anticipated proceeds and use thereof and/or consideration therefor, related costs and expenses, as well as the anticipated benefits of such actions and transactions and their expected impact on the Corporation’s guidance and targets; and the fact that closing of these transactions will be conditioned on certain events occurring, including the receipt of necessary regulatory approval.

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 the Corporation’s 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 pursuit of a divestiture of the Corporation’s operations in Belfast and Morocco include the following material assumptions: the identification and successful completion of one or more divestiture(s) or other transactions resulting therefrom on commercially satisfactory terms and the realization of the intended benefits therefrom within the anticipated timeframe. The assumptions underlying the forward-looking statements made in this press release in relation to the Pending Transaction discussed herein include the following material assumptions: the satisfaction of all conditions of closing and the successful completion of such strategic actions and transaction within the anticipated timeframe, including receipt of regulatory approvals. 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 the Corporation’s financial report for the fiscal year ended December 31, 2018.

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 “Brexit””[, the financial condition of the airline industry], business aircraft customers, and the rail industry; trade policy; increased competition; political instability and force majeure events or global climate change), operational risks (such as risks related to developing new products and services; development of new business and awarding of new contracts; book-to-bill ratio and order backlog; the certification and homologation of products and services; fixed-price and fixed-term commitments and production and project execution, including challenges associated with certain Transportation’s legacy projects and the release of working capital therefrom; pressures on cash flows and capital expenditures based on project-cycle fluctuations and seasonality; risks associated with our ability to successfully implement and execute our strategy, transformation plan, productivity enhancements, operational efficiencies and restructuring initiatives, including the formation of Bombardier Aviation; doing business with partners; risks associated with the Corporation’s partnership with Airbus and investment in ACLP; risks associated with the Corporation’s ability to continue with its funding plan of ACLP and to fund, if required, the cash shortfalls; inadequacy of cash planning and management and project funding; product performance warranty and casualty claim losses; regulatory and legal proceedings; environmental, health and safety risks; dependence on certain customers, contracts and suppliers; supply chain risks; human resources; reliance on information systems; reliance on and protection of intellectual property rights; reputation risks; risk management; tax matters; 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 the Corporation’s financial report for the fiscal year ended December 31, 2018.

With respect to the pursuit of a divestiture of the Corporation’s operations in Belfast and Morocco 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: the failure to identify and complete any divestiture or other transaction resulting therefrom within the expected time frame, on commercially satisfactory terms or at all; all or part of the intended benefits therefrom not being realized within the anticipated timeframe, or at all; and the incurrence of related costs and expenses; and negative effects of the announcement or pendency of any such divestiture or other transaction. With respect to the Pending Transaction 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: the failure to receive or delay in receiving regulatory approvals, or otherwise satisfy the conditions to the completion of the transaction or delay in completing and uncertainty regarding the length of time required to complete such transactions, and the funds and benefits thereof not being available to Bombardier in the time frame anticipated or at all; alternate sources of funding that would be used to replace the anticipated proceeds and savings from such strategic actions and transactions, as the case may be, may not be available when needed, or on desirable terms. Accordingly, there can be no assurance that any divestiture relating to the Corporation’s operations in Belfast and Morocco, or the Pending Transaction will be undertaken or occur, or of the timing or successful completion thereof, or the amount and use of proceeds therefrom, or that the anticipated benefits will be realized in their entirety, in part or at all. There can also be no assurance as to the completion, the form, or the timing of any BT Holdco buy-back. For more details, see the Risks and uncertainties section in Other in the MD&A of the Corporation’s financial report for the fiscal year ended December 31, 2018.

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 the Corporation’s 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.