On a consolidated basis, Bombardier exceeded its 2016 guidance range for EBIT before special items; improved its year-over-year cash performance by $778 million; and delivered approximately 200 basis points of margin improvement at its Transportation, Business Aircraft and Aerostructures segments. With the successful refinancing of $1.4 billion of senior notes in the fourth quarter, the company also successfully completed the de-risking phase of its turnaround plan in 2016, securing the liquidity necessary to fully execute the final two phases of the plan: building earnings and cash flow and de-leveraging its balance sheet.
Further highlighting the Company’s progress in the fourth quarter was the successful entry-into-service of the CS300 aircraft with airBaltic, which followed the strong performance of the CS100 aircraft with SWISS since starting commercial operations over six months ago. Bombardier’s all-new, class-defining, ultra-long range business jet, the Global 7000, also began flight testing in the fourth quarter and remains on schedule to enter service in the second half of 2018.
“As we begin 2017, we are confident in our strategy, our turnaround plan and in our ability to unleash the full value of the Bombardier portfolio,” Bellemare said. “We remain focused on improving operational efficiency, flawlessly ramping up our new programs and maintaining a disciplined and proactive approach to deliver value to customers and shareholders in any market environment.”
For 2017, as per guidance introduced in December 2016, the Company expects to resume revenue growth in the low-single digits, driven by an increase in Transportation revenues and an acceleration of C Series aircraft deliveries. EBIT before special items for 2017 is forecast to increase by 35% at the mid-point of the $530 million to $630 million range, with margins improving across all business segments. Free cash flow usage should continue to improve by up to $300 million, falling in the range of $750 million to $1.0 billion as the Company continues to come down the learning curve on the C Series aircraft.
Commercial aircraft’s financial performance for 2016 was marked by the production ramp-up and the start of the revenue-generating phase of the C Series aircraft program. Revenues and deliveries were in line with guidance. The EBIT loss compares favourably relative to guidance, stemming from strong execution while ramping up production and cost control during the initial months following EIS and supported by the reliability of the aircraft in service. Bombardier is now focused on improving efficiency while ramping up to full production, continuing to increase our order backlog, delivering the C Series aircraft and providing customer support.Date: February 20, 2017