Bombardier Announces Financial Results for the First Quarter Ended March 31, 2012
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Bombardier Inc. /
Bombardier Announces Financial Results for the First Quarter Ended March 31,
2012
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The issuer is solely responsible for the content of this announcement.
MONTREAL, QUEBEC--(Marketwire - May 10, 2012) - (TSX: BBD.A)(TSX: BBD.B)
(All amounts in this press release are in U.S. dollars unless otherwise
indicated.)
-- Revenues of $3.5 billion, compared to $4.7 billion last fiscal year
-- EBIT of $215 million, or 6.1% of revenues, compared to $312 million, or
6.7%, last fiscal year
-- Net income of $190 million, or diluted EPS of $0.10, compared to $220
million, or diluted EPS of $0.12, last fiscal year
-- Free cash flow usage of $712 million, compared to a usage of $409
million last fiscal year
-- Cash position of $3.2 billion as at March 31, 2012, compared to $3.4
billion as at December 31, 2011
-- Backlog of $55.2 billion as at March 31, 2012, compared to $53.9 billion
as at December 31, 2011
-- Closing of a new revolving credit facility of EUR500 million ($668
million) and issuance of $500 million unsecured notes
-- In May 2012, signature of a letter of intent with WestJet for up to 45
Q400 NextGen turboprops
Bombardier (TSX: BBD.A)(TSX: BBD.B) today released its financial results for the
first quarter ended March 31, 2012. Revenues totalled $3.5 billion, compared to
$4.7 billion last fiscal year. Earnings before financing expense, financing
income and income taxes (EBIT) amounted to $215 million, compared to $312
million last fiscal year, representing an EBIT margin of 6.1%, compared to 6.7%
for the corresponding period last fiscal year.
Net income reached $190 million, compared to $220 million for the corresponding
period last fiscal year. Diluted earnings per share (EPS) was $0.10 for the
three-month period ended March 31, 2012, compared to diluted EPS of $0.12 for
the corresponding period last fiscal year. The overall backlog reached $55.2
billion, compared to $53.9 billion as at December 31, 2011.
Free cash flow usage (cash flows from operating activities less net additions to
property, plant and equipment (PP&E) and intangible assets) totalled $712
million, compared to a usage of $409 million for the corresponding period last
fiscal year. The cash position stood at $3.2 billion as at March 31, 2012,
compared to $3.4 billion as at December 31, 2011.
"As anticipated, we had lower revenues in the first quarter," said Pierre
Beaudoin, President and Chief Executive Officer, Bombardier Inc. "At Aerospace,
the entry into service of the Vision Flight Deck on the Global 5000 and Global
6000 aircraft and the resulting transition, as well as lower deliveries of
commercial aircraft, had an impact on our revenues. Nevertheless, we were able
to contain costs and maintain our profitability. We had a solid level of new
orders in business jets and we're starting to see momentum in commercial
aircraft orders which led to an increased backlog of $23.3 billion."
"In Transportation, the results were affected by the completion of some
contracts, mostly in Asia-Pacific, and the careful ramp-up of deliveries on
complex new orders. The order activity remains quite strong in most regions,
particularly in North America and Europe."
"We have a solid backlog of $55.2 billion giving us good visibility on the
future. 2012 is an exciting year. We're making good progress on our development
programs as we target the first flight of the CSeries aircraft by the end of
this year, and we're in an excellent position in the rail transportation
market," concluded Mr. Beaudoin.
During the first quarter of 2012, Bombardier issued $500 million of unsecured
notes and entered into a new unsecured EUR500 million ($668 million) revolving
credit facility available for Bombardier Transportation for cash drawings. Both
transactions were oversubscribed, showing the markets' confidence in the
Corporation's business plan. Furthermore, in April 2012, the availability
periods of Bombardier Transportation and Bombardier Aerospace's letter of credit
facilities were extended for an additional year to May 2015 and June 2015
respectively. Also in April, the maturity date for the $750 million unsecured
revolving credit facility was extended by one year to June 2015.
Bombardier's Board of Directors approved yesterday, at its regularly scheduled
meeting, the implementation of a new normal course issuer bid, pursuant to which
the Corporation would be authorized to purchase up to 5% of the issued and
outstanding Class B shares (subordinate voting) and 5% of the issued and
outstanding Class A shares (multiple voting), following expiry of its current
normal course issuer bid on June 16, 2012, subject to the approval of the
Toronto Stock Exchange.
Bombardier Aerospace
At Bombardier Aerospace, revenues totalled $1.5 billion, compared to $2.2
billion for the first quarter last fiscal year, while EBIT reached $91 million,
or 6.1% of revenues, compared to $141 million, or 6.4%, for the first quarter
last fiscal year. Free cash flow usage of $572 million compared to a usage of
$168 million for the corresponding period last year. Bombardier Aerospace
delivered 37 aircraft for the first quarter ended March 31, 2012, compared to
61 for the corresponding period last fiscal year and received 68 net orders,
compared to 86 for the three-month period ended April 30, 2011. Its backlog
increased to $23.3 billion as at March 31, 2012, compared to $22 billion as at
December 31, 2011.
During the first quarter of 2012, the business aircraft division received net
orders for 40 aircraft, including a firm order for five Global 6000 jets from
AVWest of Australia, for a value of $293 million, based on list price. Following
the certification from the European Aviation Safety Agency (EASA) and the U.S.
Federal Aviation Administration (FAA), the Vision Flight Deck entered into
service on schedule in March 2012, on the Global 5000 and Global 6000 aircraft.
On the commercial aircraft front, Bombardier Aerospace has improved its local
presence in emerging markets leading to 28 orders coming from a variety of
countries. During the quarter, the group received, notably, an order from
PrivatAir of Switzerland for five CS100 aircraft with five options; one order
from PT. Garuda Indonesia (Persero) Tbk. for six CRJ1000 NextGen regional jets
with 18 options; an order for eight Q400 NextGen aircraft with 12 options from
Eurolot S.A. of Poland; and an order for five Q400 NextGen aircraft from
Ethiopian Airlines. The total value of these firm orders, based on list prices,
amounts to more than $1 billion. Subsequent to the quarter, in May 2012, WestJet
from Canada signed a letter of intent to purchase 20 Q400 NextGen turboprops
with the option to purchase a further 25.
Also during the quarter, the group signed a definitive agreement with Commercial
Aircraft Corporation of China Ltd. (COMAC) to collaborate on commonality
projects, building on the complementary nature of COMAC's C919 aircraft and its
CSeries aircraft to help maximize both parties' cost savings and market shares.
Bombardier Transportation
For the first quarter ended March 31, 2012, Bombardier Transportation's revenues
totalled $2 billion, compared to $2.5 billion last fiscal year. EBIT reached
$124 million, or 6.2% of revenues, for the first quarter ended March 31, 2012,
compared to $171 million, or 6.9%, for the corresponding period last fiscal
year. Free cash flow usage of $100 million compared to a usage of $168 million
last fiscal year. Bombardier Transportation reported new orders worth $1.2
billion for the first quarter, representing a book-to-bill ratio of 0.6,
compared to $1.2 billion and a book-to-bill ratio of 0.5, for the corresponding
period last fiscal year. The order backlog stood at $31.9 billion as at March
31, 2012, the same level as at December 31, 2011.
During the first quarter of 2012, Bombardier Transportation received an order
from Deutsche Bahn AG, of Germany, for 16 four-car TWINDEXX double-deck trains,
valued at $208 million. This order is part of a framework agreement signed in
2008, and is an example of the success of the group's strategy to win key
framework contracts in Europe.
In April 2012, to continue on its long-term investment in emerging markets, the
group inaugurated a state-of-the-art monorail vehicle manufacturing facility in
Hortolandia, Brazil. This new production site is the group's global production
centre for Monorails, serving the fast-growing market in Brazil as well as
supporting export opportunities in Latin America and around the world.
FINANCIAL HIGHLIGHTS
(In millions of U.S. dollars, except per share amounts, which are shown in
dollars)
FINANCIAL HIGHLIGHTS
(In millions of U.S. dollars, except per share amounts, which are shown in
dollars)
-------------------------------------------------------------------------------
For the three-
month periods
ended[1] March 31, 2012 April 30, 2011
-------------------------------------------------------------------------------
BA BT Total BA BT Total
-------------------------------------------------------------------------------
Results of
operations
Revenues $ 1,499 $ 2,006 $ 3,505 $ 2,188 $ 2,473 $ 4,661
Cost of sales 1,260 1,647 2,907 1,857 2,068 3,925
-------------------------------------------------------------------------------
Gross margin 239 359 598 331 405 736
SG&A 161 203 364 160 203 363
R&D 31 34 65 33 31 64
Other income (44 ) (2 ) (46 ) (3 ) - (3 )
-------------------------------------------------------------------------------
EBIT $ 91 $ 124 215 $ 141 $ 171 312
Financing expense 152 177
Financing income (152 ) (141 )
-------------------------------------------------------------------------------
EBT 215 276
Income taxes 25 56
-------------------------------------------------------------------------------
Net income $ 190 $ 220
-------------------------------------------------------------------------------
Attributable to :
Equity holders
of Bombardier
Inc. $ 185 $ 220
Non-controlling
interests 5 -
-------------------------------------------------------------------------------
$ 190 $ 220
-------------------------------------------------------------------------------
EPS (in dollars):
Basic and
diluted $ 0.10 $ 0.12
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Segmented free
cash flow usage $ (572 ) $ (100 ) $ (672 ) $ (168 ) $ (168 ) $ (336 )
Net income taxes
and net interest
paid (40 ) (73 )
-------------------------------------------------------------------------------
Free cash flow
usage $ (712 ) $ (409 )
-------------------------------------------------------------------------------
BA : Bombardier Aerospace; BT : Bombardier Transportation
[1] Effective December 31, 2011, the Corporation changed its financial
year-end from January 31 to December 31. As a result, the comparative
three-month period ended April 30, 2011 is comprised of three months
of results of BA for the period from February to April and of BT for
the period from January to March.
FINANCIAL RESULTS FOR THE FIRST QUARTER ENDED MARCH 31, 2012
ANALYSIS OF RESULTS
Consolidated results
Consolidated revenues totalled $3.5 billion for the first quarter ended March
31, 2012, compared to $4.7 billion for the same period last year.
For the first quarter ended March 31, 2012, EBIT reached $215 million, or 6.1%
of revenues, compared to $312 million, or 6.7%, for the corresponding period the
previous year.
Net financing expense amounted to nil for the first quarter of the current
fiscal year, compared to $36 million for the corresponding period last fiscal
year. The decrease is mainly due to an interest income representing the interest
portion amounting to $17 million of a gain of $40 million upon the successful
resolution of a litigation in connection with the Canadian Income Tax Act and
lower interest expense on long-term debt after effect of hedges.
The effective income tax rate was 11.6% for the three-month period ended March
31, 2012, compared to the statutory income tax rate in Canada of 26.7%. The
lower effective tax rate was mainly due to the positive impact of the
recognition of income tax benefits related to tax losses and temporary
differences, partially offset by unrecognized tax benefits.
Net income amounted to $190 million, or diluted EPS of $0.10, for the first
quarter ended March 31, 2012, compared to $220 million, or diluted EPS of $0.12,
for the period ended April 30, 2011.
For the three-month period ended March 31, 2012, free cash flow usage totalled
$712 million, compared to a usage of $409 million for the corresponding period
the previous year.
As at March 31, 2012, Bombardier's order backlog reached $55.2 billion, compared
to $53.9 billion as at December 31, 2011.
Bombardier Aerospace
-- Revenues of $1.5 billion
-- EBIT of $91 million, or 6.1% of revenues
-- EBITDA of $141 million, or 9.4% of revenues
-- Free cash flow usage of $572 million
-- 68 net orders
-- Order backlog of $23.3 billion
Bombardier Aerospace's revenues amounted to $1.5 billion for the three-month
period ended March 31, 2012, compared to $2.2 billion for the corresponding
period the previous year. This decrease is mainly due to lower deliveries of
business aircraft mainly in large business jets due to the transition to the
Global 5000 and Global 6000 aircraft with the new Vision Flight Deck, which
entered into service at the end of March 2012, and lower deliveries of
commercial aircraft mainly due to lower production rates and to the timing of
financing availability for a customer.
For the first quarter ended March 31, 2012, EBIT reached $91 million, or 6.1% of
revenues, compared to $141 million, or 6.4%, for the corresponding period the
previous year. Excluding the successful resolution of a litigation in connection
with the Canadian Income Tax Act amounting to $23 million, the EBIT margin
decreased by 1.9 percentage points. The decrease is mainly due to lower
absorption of selling, general and administrative (SG&A) and research and
development (R&D) expenses and amortization of PP&E due to the abnormally low
level of revenues, and the negative impact of higher exchange rates, after
giving effect to hedges, for the Canadian dollar against the U.S. dollar. This
was partially offset by higher net selling prices for business and commercial
aircraft, the mix between business and commercial aircraft deliveries, higher
margins from service activities, and a net positive variance on financial
instruments carried at fair value and provisions for credit and residual value
guarantees.
Free cash flow usage totalled $572 million for the first quarter ended March
31, 2012, compared to a usage of $168 million for the corresponding period last
fiscal year. This $404-million decrease is mainly due to a negative period-over-
period variation in net change in non-cash balances related to operations,
higher net additions to PP&E and intangible assets, due to our significant
investments in new products, and lower earnings before financing expense,
financing income, income taxes and amortization (EBITDA).
For the quarter ended March 31, 2012, aircraft deliveries totalled 37 units,
compared to 61 for the three-month period ended April 30, 2011. The 37
deliveries consisted of 29 business, 7 commercial and 1 amphibious aircraft (37
business, 23 commercial and 1 amphibious aircraft for the corresponding period
last fiscal year).
Bombardier Aerospace received 68 net orders during the quarter ended March
31, 2012, compared to 86 during the corresponding period the previous year. The
68 net orders consisted of 40 net orders for business aircraft and 28 orders for
commercial aircraft (77 net orders for business aircraft (including an order of
50 Global aircraft from NetJets), 5 orders for commercial aircraft and 4 orders
for amphibious aircraft for the period ended April 30, 2011).
Bombardier Aerospace's order backlog reached $23.3 billion as at March
31, 2012, compared to $22 billion as at December 31, 2011. The 5.9% increase is
mainly due to an increase in orders for large business aircraft, turboprops and
commercial jets.
Bombardier Transportation
-- Revenues of $2 billion
-- EBIT of $124 million, or 6.2% of revenues
-- EBITDA of $156 million, or 7.8% of revenues
-- Free cash flow usage of $100 million
-- New order intake totalling $1.2 billion (book-to-bill ratio of 0.6)
-- Order backlog of $31.9 billion
Bombardier Transportation's revenues amounted to $2 billion for the three-month
period ended March 31, 2012, compared to $2.5 billion for the corresponding
period last year. The revenues for the first quarter of 2012 have been affected
by the completion of some contracts, mostly in Asia-Pacific and, to a lesser
extent, in Europe, while major orders received in these regions in the last
quarters are still in the start-up phase.
For the first quarter ended March 31, 2012, EBIT totalled $124 million, or 6.2%
of revenues, compared to $171 million, or 6.9%, for the corresponding quarter
the previous year. The 0.7 percentage-point decrease is mainly due to lower
absorption of SG&A and R&D expenses and a lower overall gross margin in rolling
stock, due to execution issues in some contracts; partially offset by a higher
gross margin in services and system and signalling due to overall better
contract execution, and a favourable product mix.
Free cash flow usage for the quarter ended March 31, 2012 totalled $100 million,
compared to a usage of $168 million for the corresponding period last fiscal
year. The $68-million improvement is mainly due to a positive period-over-period
variation in net change in non-cash balances related to operations, partially
offset by a lower EBITDA.
The order intake for the first quarter ended March 31, 2012 was $1.2 billion,
reflecting a book-to-bill ratio of 0.6, compared to $1.2 billion and a book-to-
bill ratio of 0.5, for the corresponding period last fiscal year.
Bombardier Transportation's backlog stood at $31.9 billion as at March
31, 2012, same level as at December 31, 2011, as higher revenues than order
intake were offset by the strengthening of most foreign currencies versus the
U.S. dollar as at March 31, 2012, compared to December 31, 2011, mainly the euro
and pound sterling.
DIVIDENDS ON COMMON SHARES
Class A and Class B Shares
A quarterly dividend of $0.025 Cdn per share on Class A Shares (Multiple Voting)
and of $0.025 Cdn per share on Class B Shares (Subordinate Voting) is payable on
June 30, 2012 to the shareholders of record at the close of business on June
15, 2012.
Holders of Class B Shares (Subordinate Voting) of record at the close of
business on June 15, 2012 also have a right to a priority dividend of
$0.000390625 Cdn.
DIVIDENDS ON PREFERRED SHARES
Series 2 Preferred Shares
A monthly dividend of $0.0625 Cdn per share on Series 2 Preferred Shares has
been paid on March 15 and on April 15, 2012.
Series 3 Preferred Shares
A quarterly dividend of $0.32919 Cdn per share on Series 3 Preferred Shares is
payable on July 31, 2012 to the shareholders of record at the close of business
on July 13, 2012.
Series 4 Preferred Shares
A quarterly dividend of $0.390625 Cdn per share on Series 4 Preferred Shares is
payable on July 31, 2012 to the shareholders of record at the close of business
on July 13, 2012.
About Bombardier
Bombardier is the world's only 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 Montreal, Canada. Our shares are traded on the
Toronto Stock Exchange (BBD) and we are listed on the Dow Jones Sustainability
World and North America indexes. In the fiscal year ended December 31, 2011, we
posted revenues of $18.3 billion. News and information are available at
bombardier.com or follow us on Twitter (at)Bombardier.
CRJ, CRJ1000, CS100, CSeries, Global, Global 5000, Global 6000, Learjet 85,
NextGen, Q400,The Evolution of Mobility, TWINDEXX and Vision Flight Deck are
trademarks of Bombardier Inc. or its subsidiaries.
The Management's Discussion and Analysis and the Interim consolidated financial
statements are available at www.bombardier.com.
FORWARD-LOOKING STATEMENTS
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, markets 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; our
competitive position; and the expected impact of the legislative and regulatory
environment and legal proceedings on our business and operations. Forward-
looking statements generally can be identified by the use of forward-looking
terminology such as "may", "will", "expect", "intend", "anticipate", "plan",
"foresee", "believe", "continue" or "maintain", the negative of these terms,
variations of them or similar terminology. By their nature, forward-looking
statements require us 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 forecasted results. While we consider our
assumptions to be reasonable and appropriate based on information currently
available, there is a risk that they may not be accurate. For additional
information with respect to the assumptions underlying the forward-looking
statements made in this press release, refer to the respective Guidance and
forward-looking statements sections in Overview, Bombardier Aerospace and
Bombardier Transportation sections in the Management's Discussion and Analysis
("MD&A") in the Corporation's annual report for the fiscal year ended December
31, 2011.
Certain factors that could cause actual results to differ materially from those
anticipated in the forward-looking statements include risks associated with
general economic conditions, risks associated with our business environment
(such as risks associated with the financial condition of the airline industry
and major rail operators), operational risks (such as risks related to
developing new products and services; doing business with partners; product
performance warranty and casualty claim losses; regulatory and legal
proceedings; to the environment; dependence on certain customers and suppliers;
human resources; fixed-price commitments and production and project execution),
financing risks (such as risks related to liquidity and access to capital
markets, exposure to credit risk, certain restrictive debt covenants, financing
support provided for the benefit of certain customers and reliance on government
support) and market risks (such as risks related to foreign currency
fluctuations, changing interest rates, decreases in residual value and increases
in commodity prices). For more details, see the Risks and uncertainties section
in Other. 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 our expectations as at the date of this
press release 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.
CAUTION REGARDING NON-GAAP EARNINGS MEASURES
This press release is based on reported earnings in accordance with
International Financial Reporting Standards IFRS (generally accepted accounting
principles (GAAP)). It is also based on EBITDA and Free Cash Flow. These non-
GAAP measures are directly derived from the Consolidated Financial Statements,
but do not have a standardized meaning prescribed by IFRS; therefore, others
using these terms may calculate them differently. Management believes that a
significant number of the users of its MD&A analyze the Corporation's results
based on these performance measures. Refer to the section Non-GAAP financial
measures in the MD&A for definitions and reconciliations to the most comparable
IFRS measures.
Contacts:
Isabelle Rondeau
Director, Communications
Bombardier Inc.
+514-861-9481
Shirley Chenier
Senior Director, Investor Relations
Bombardier Inc.
+514-861-9481
www.bombardier.com
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Source: Bombardier Inc. via Thomson Reuters ONE
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