Saab (OTC: SAABF) has signed an extension agreement with Boeing (NYSE: BA) for the manufacturing of large cargo doors, bulk cargo doors and access doors for the Boeing 787 Dreamliner.
The framework agreement is an extension of an existing contract signed with Boeing in 2004 for the 787 Dreamliner program.
Since the programme started, Saab has delivered in excess of 1,100 shipsets for the Boeing 787 Dreamliner programme.
Saab has a long experience in supplying major aerostructures for military as well as commercial aircraft programmes. Like many other major 787 structures, the doors will be mainly made of composite materials. A range of systems are built into the doors’ composite structures, providing Boeing with lightweight doors that are easy to install.
New agreement to focus on enhancing performance and unprecedented sustainability for world’s fastest commercial aircraft
Collins Aerospace Systems, a unit of Raytheon Technologies (RTX), has signed a collaboration agreement with Boom Supersonic, the aerospace company building the world’s fastest airliner, to advance nacelle technology on Boom’s forthcoming flagship supersonic airliner, Overture. Overture will be the world’s fastest airliner and is designed and committed to industry-leading standards of speed, safety, and sustainability.
Collins Aerospace engineers will work in concert with Boom to develop inlet, nacelle and exhaust system technologies that enable fuel-burn reduction and cutting-edge acoustics for cleaner and quieter supersonic flight. They will do this via lightweight aerostructures and variable nacelle geometry. Collins Aerospace has been providing innovative nacelle technology for more than 70 years, including development of the first commercial variable fan nozzle for high-bypass-ratio geared turbofan (GTF) engines.
“Through improved acoustics and lightweight materials systems, we can provide the next generation of supersonic propulsion systems with the nacelle technologies that not only enable higher performance and lower fuel burn, but also quieter operation,” said Marc Duvall, president, Aerostructures, Collins Aerospace. “Having completed 19 nacelle certification programs over the past decade, we’re uniquely positioned to collaborate with Boom Supersonic to create new propulsion-system solutions that will be key enablers of Overture’s success.”
The combined engineering team will be exploring the development of advanced acoustics and variable inlet and exhaust technologies required to minimize aircraft noise for passengers and airport communities while enhancing performance.
“Boom is taking an all-encompassing approach to sustainability — from our commitment to make Overture 100% carbon neutral to minimizing community noise and emissions, we’re dedicated to making mainstream supersonic travel environmentally and economically sustainable,” said Blake Scholl, Boom founder and CEO. “We are leveraging Collins’ experience in developing more fuel efficient and noise attenuating technologies for nacelles to help us develop Overture as an environmentally responsible supersonic jet.”
Boom’s mission is to make the world dramatically more accessible by making supersonic travel mainstream. Overture is in its design phase with plans to finalize the configuration and begin building the first airliner while XB-1 is flying supersonic. Boom will roll out the first completed Overture aircraft in 2025, with entry into service planned for 2029.
NEW YORK (Reuters) – Mitsubishi Heavy Industries Ltd <MHVYF> is confident that it has the technical and production know-how to build high-tech wings for Airbus SE <EADSY> jetliners, the chief executive of the Japanese conglomerate said on Wednesday.
MHI developed sophisticated production processes at its facility in Nagoya in the process of building wings for the Boeing Co <BA> 787 Dreamliner, Chief Executive Seiji Izumisawa said in an interview.
“We have accumulated expertise in producing aerostructures as a tier 1 supplier, so if the opportunity does present itself we will certainly be willing to consider it,” he said.
It is not yet clear whether Airbus plans to outsource wings on future jets, such as its next-generation single-aisle aircraft, which could come out in about a decade.
Such future work would be important to MHI in part because of Boeing’s decision to bring wing production back in-house on its latest jet, the 777X.
“We do have the capability to produce some pretty complicated components,” said Izumisawa, who said he was involved in developing the 787 wings.
(Reporting by Alwyn Scott; Editing by Sonya Hepinstall)
FILE PHOTO: The logo of Mitsubishi Heavy Industries is seen at the company’s Sagamihara plant in Sagamihara, Japan
May 7, 2019 – Montréal Bombardier Inc., Business Aircraft, Press Release
Value of Learjet 75 transaction an estimated US$69 million based on 2019 list prices
Learjet 75 aircraft features the quietest and most private cabin in its class, an eight-seat double club configuration, a smooth ride and the only flat floor in the light jet category
Bombardier’s Learjet fleet recently celebrated 25 million flight hours
Bombardier today announced that an undisclosed customer has purchased five industry-defining Learjet 75 aircraft. The transaction is valued at approximately US$69 million dollars based on 2019 list prices.
Today’s announcement follows the landmark achievement Bombardier’s fleet of trailblazing Learjet aircraft set earlier in 2019, when the fleet surpassed the 25 million flight-hour mark, adding yet another accomplishment to an impressive string of Learjet milestones and firsts. The first Learjet business aircraft entered service in 1964, creating the experience and defining the industry of private flight.
“The ultimate business tool, Learjet 75 aircraft feature industry-leading performance and help drive direct bottom line results,” Peter Likoray, Senior Vice President, Worldwide Sales and Marketing, Bombardier Business Aircraft. “Reliability and longevity are just two of the reasons customers among Fortune 500 companies continue to choose Learjet aircraft for productivity gains. With its bevy of recent enhancements, the Learjet 75 aircraft is a superior business jet offering in terms of size, performance and reliability, all at highly competitive operating cost.”
Bombardier continues to invest in this industry-leading light business jet, with its recently-released comprehensive Garmin G5000 avionics upgrade, which will allow customers to optimize their routes and paves the way for future technological enhancements. The upgrade will be offered as forward and retrofit for in-service Learjet aircraft. Bombardier also recently announced that Learjet 75 aircraft operators now benefit from lengthened intervals between recurring major powerplant inspections, which have been extended from 3,000 to 3,500 engine hours.
Renowned worldwide for its sleek ramp appeal and favoured by pilots for its impressive handling characteristics and high-performance, the Learjet 75 is the only business jet in its class to feature an eight-seat double-club configuration, a flat floor throughout the cabin and a pocket door for reduced noise levels.
Since acquiring the Learjet Corporation in 1990, Bombardier has introduced an impressive eight new models, including the best-selling Learjet 75 aircraft, which entered service in 2013.
About Bombardier
With over 68,000 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, 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 Commercial Aircraft today celebrated the delivery of the first two of four CRJ900 aircraft ordered by Uganda National Airlines Company in July 2018. The new airline has selected Bombardier and the CRJ900 regional jets fitted with the ATMOSPHÈRE cabin for its upcoming debut, making it the first operator in Africa with this enhanced cabin experience.
The CRJ900 delivery ceremony held today at Bombardier’s Mirabel, Québec facility, was attended by executives of both Uganda Airlines and Bombardier Commercial Aircraft as well as several shop floor employees who build the CRJ900 aircraft.
“We are thrilled to commence our operations with the world’s leading
regional jet, and we look forward to providing the most modern passenger
experience in regional aviation to the people of Uganda and across
Africa,” said Ephraim Bagenda, CEO, Uganda National Airlines.”
“We congratulate Uganda Airlines for taking delivery of their very first CRJ900 jetliner fitted with the ATMOSPHÈRE cabin in a dual-class configuration with 76 seats, including 12 first class seats. The CRJ Series is recognized for its superior economics and efficiency and I am confident that it will be the stepping stone for the development of Uganda’s regional air travel”, said Fred Cromer, President, Bombardier Commercial Aircraft.
About Bombardier
With over 68,000 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 Montréal, 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, 2018, Bombardier posted revenues of $16.2 billion. News and information are available at bombardier.com or follow us on Twitter @Bombardier.
Fleet operator continues to confirm orders after signing letter of intent for multiple Global 6500 and Global 7500 aircraft in May 2018
HK Bellawings Jet Limited will become operator managing China’s largest fleet of Global 6500 and Global 7500 aircraft
Flagship Global 7500 business jet making its airshow debut at ABACE
Long-range, large-cabin Global 5500 and Global 6500 aircraft on track to enter service this year
Bombardier is pleased to announce that Hong Kong aircraft management company HK Bellawings Jet Limited firmed up an order for four Global 7500 business jets. This news comes as the flagship Global 7500 aircraft arrives at the Asian Business Aviation Conference & Exhibition (ABACE), its first airshow since entering service.
“We are proud to announce this firm order as the Global 7500
aircraft makes its public debut at ABACE, one of the world’s most
important aerospace exhibitions,” said Khader Mattar, Vice President of
Sales for the Middle East, Africa, Asia Pacific and China, Bombardier
Business Aircraft. “Our flagship jet has been causing a sensation since
entering service less than four months ago, and this order underscores
that this aircraft, with its unparalleled range and four true living
spaces, is ideal for the Greater China region.”
HK Bellawings first announced their intent to purchase up to 18 Global 6500 and Global 7500
aircraft, for a potential value of $1.14 billion US, in May 2018 at the
European Business Aviation Convention & Exhibition (EBACE) in
Geneva. Hours earlier, Bombardier had stunned the industry by launching
two new long-range, large-cabin business jets, the Global 5500 and Global 6500 aircraft.
In September 2018, HK Bellawings firmed up its order of four Global 6500 and two Global 7500
business jets, for an approximate value of $370 million US, based on
current list prices for typically equipped aircraft. Today, HK
Bellawings and Bombardier are pleased to confirm that four more Global 7500 aircraft are now part of that firm purchase,
bringing the total of firm aircraft orders to 10. This latest
announcement represents a value of approximately $291 million US, based
on current list prices.
“We are thrilled to offer our customers access to the unparalleled Global 7500 aircraft as part of our unmatched fleet,” said HK Bellawings President Mr. YJ Zhang. “The Global 6500 and Global 7500
aircraft align with HK Bellawings’ rapid development to be a one-stop
business aviation solution. As the operator that will manage one of the
world’s largest fleet of Global 6500 and Global 7500 aircraft, HK Bellawings Jet will further expand our business scope and continuously pursue higher goals.”
The Global 7500 aircraft’s range of 7,700 nautical miles is
the longest in business aviation. This business jet can connect the
cities of Beijing, Shanghai and Hong Kong non-stop to the cities of New
York, London or Milan, and also fly nonstop from Singapore to
Vancouver.*
Established in 2014, HK Bellawings Jet Limited is a distinguished
business jet management company dedicated to providing a diverse array
of professional, highly efficient and comprehensive business aviation
services and solutions, which include business jet management, aircraft
maintenance, travel concierge service, aircraft acquisition service, and
business aviation consultancy. They operate a fleet of Challenger and Global business aircraft.
About Bombardier
With over 68,000 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.
Bombardier announced today that it delivered its first European-based Global 7500 aircraft to long-time Bombardier customer, Niki Lauda, as production and completions of the award-winning business jet continue to ramp up as planned. Bombardier is on track to deliver between 15 and 20 Global 7500 aircraft in 2019.
Long-time Bombardier customer and F1 World Champion takes delivery of the first European-based Global 7500aircraft
Production and completions ramp up for Global 7500 jets proceeding as planned
The Global 7500 aircraft recently completed the world’s
longest-range business jet flight in history and broke the city pair
speed record between LA and NYC*
Winner of the 2019 Aviation Week Grand Laureate Award, the Global 7500 aircraft offers Bombardier’s signature smooth ride and a spaciousness that is unique among business jets
Bombardier announced today that it delivered its first European-based Global 7500 aircraft
to long-time Bombardier customer, Niki Lauda, as production and
completions of the award-winning business jet continue to ramp up as
planned. Bombardier is on track to deliver between 15 and 20 Global 7500 aircraft in 2019.
“We are thrilled to deliver our flagship Global 7500 business
jet to Niki Lauda, our esteemed customer for many years,” said David
Coleal, President, Bombardier Business Aircraft. “The Global 7500 aircraft
is simply the best business jet on the market. It sets the standard by
which all other aircraft in private aviation will be measured,
demonstrated by the prestigious design and aviation awards it has
garnered. The Global 7500 aircraft is the crown jewel of the industry.”
“I have enjoyed watching the evolution and growth of the Global
Aircraft program. I have always been impressed with the expertise,
craftsmanship and innovation that go into building every Global business jet,” said Niki Lauda. “The Global 7500
aircraft is the culmination of all the knowledge Bombardier teams have
gained over the years and I look forward to experiencing the range,
speed and comfort this jet has to offer.”
The Global 7500 jet is the latest in a series of Bombardier
business aircraft that Mr. Lauda has owned and piloted during his career
as an aviator. Previously, he operated a Global 6000, Global 5000 and Challenger 300 jet as his private aircraft.
Since its entry-into-service, the Global 7500 aircraft has unequivocally proven itself to be the highest-performing aircraft in the industry. The Global 7500
business jet has a top speed of Mach 0.925 and recently flew from
Singapore to Tucson, completing a record-setting 8,152 nautical mile
flight—the longest-range flight in business aviation history. In
addition, it also recently broke the city pair speed record between Los
Angeles and New York. The Global 7500 aircraft continues to assert its position as the leader in the business jet market.
The Global 7500 aircraft offers Bombardier’s signature smooth ride and a spaciousness that is unique among business jets. With its award-winning bespoke interior featuring a full-size kitchen and four true living spaces, the Global 7500 jet offers the ultimate in-flight experience. Setting the benchmark for the most exceptional cabin interior, the Global 7500 aircraft offers the most innovative features: Bombardier’s patented Nuage seat, meticulously designed for maximum comfort and the revolutionary nice Touch cabin management system (CMS), a new way to connect with the Global 7500 aircraft cabin through the Bombardier Touch dial, featuring business aviation’s first application of an OLED display.
About Bombardier
With over 68,000 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 Montréal, 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, 2018, Bombardier
posted revenues of $16.2 billion. News and information are available at bombardier.com or follow us on Twitter @Bombardier.
Toronto, March 29, 2019 – Bombardier
Commercial Aircraft announced today that a customer, who has requested
to remain unidentified at this time, has signed an order to acquire six
new Q400 aircraft.
Based on the list price of the Q400 aircraft, the firm order is valued at approximately US$ 202 million.
“The Q400 aircraft offers the perfect balance of passenger comfort
and operating economics while maintaining its unmatched range and speed
advantage versus other turboprops,” said Fred Cromer, President,
Bombardier Commercial Aircraft. “The demand for turboprop aircraft
worldwide is tremendous and the Q Series aircraft are ideally positioned
to meet the needs of regional airlines as they offer a unique ability
to serve diverse and challenging environments. The Q400 offers the
lowest seat costs amongst turboprops, with an enhanced passenger
experience and a proven 99.5 per cent reliability.”
About Bombardier
With over 68,000 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, 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.
-EBIT before special items(1) up 42% year-over-year to more than $1.0B on revenues of $16.2B for the year; EBIT increased 235% year-over-year to $1.0B
-2018 EBIT margin before special items(1) up 180 bps year-over-year to 6.3%; EBIT margin of 6.2%
-Full year free cash flow(1) of $182M, comprising proceeds from certain transactions, including $1.0B of cash generation in the fourth quarter; full year cash flows from operating activities of $597M
-Strong backlog growth at Business Aircraft and Transportation, with full year book-to-bill ratios(2) of 1.1 at both segments, and a consolidated backlog of $53.1B
-2019 guidance affirmed, clear path to achieve 2020 objectives
Bombardier (TSX: BBD.B) today reported its fourth quarter and full year 2018 results, highlighting solid margin growth, improved cash flows and continued progress executing its turnaround plan. The successful entry-into-service of the Global 7500 business jet in the fourth quarter also marked the completion of Bombardier’s heavy investment cycle, a key milestone in the company’s turnaround plan.
“2018 was a year of solid progress,” said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc. “We continued to strengthen our business and set a strong foundation for growth. A foundation that includes a refreshed portfolio of best-in-class products, industry-leading backlogs and a more streamlined cost structure, all of which gives us a clear path to achieve our 2020 objectives.”
“As we begin the fourth year of our turnaround journey, Bombardier is a much stronger company,” continued Bellemare. “Our major program risks are retired, our heavy investment cycle is behind us and our franchises are well positioned for growth. For 2019, we are focused on flawless execution of our rail projects, the ramp-up of the Global 7500 and entry-into-service of the Global 5500 and Global 6500. We will also continue to drive financial performance through disciplined capital allocation and improved productivity and efficiency across the organization.”
Bombardier’s 2018 consolidated revenues reached $16.2 billion, reflecting 3% average year-over-year growth across Transportation, Business Aircraft and Aerostructures, excluding currency impact. Book-to-bill ratios(2) at Transportation and Business Aircraft both equaled 1.1 for the year, demonstrating strong demand for Bombardier’s products and services. Bombardier’s consolidated backlog reached $53.1 billion at the end of 2018, supporting future growth targets.
EBIT before special items continued to improve in 2018, increasing 42% year-over-year from $725 million to more than $1.0 billion, the top-end of the company’s guidance. The 6.3% EBIT margin before special items in 2018 represents a strong 330 bps increase since the start of the turnaround plan in 2015, well above the 5-6% range originally targeted. On a reported basis, EBIT increased 235% year-over-year to $1.0 billion, representing a margin of 6.2%.
Bombardier generated $1.0 billion of free cash flow in the fourth quarter of 2018. Full year free cash flow generation equaled $182 million, at the high end of the company’s revised guidance. This amount includes aggregate net proceeds of approximately $750 million from the sale of the Downsview property and the monetization of royalties associated with the previously announced CAE transaction. Cash flows from operating activities amounted to $597 million for the full year, and to $1.3 billion in the fourth quarter. Bombardier ended the year in a solid cash position, with $3.2 billion in cash and cash equivalents.
Selected results
SEGMENTED RESULTS AND HIGHLIGHTS
Business Aircraft
Business Aircraft achieved a historical milestone in December 2018 with the on plan service entry of the largest and longest range industry flagship Global 7500 aircraft. With a strong backlog and unsurpassed performance in its category, the Global 7500 is expected to be Business Aircraft’s key growth driver for years to come.
Revenues, EBIT before special items and deliveries were in line with guidance for 2018.
The segment achieved industry leading deliveries at 137 aircraft for 2018, including 42 Global, 83 Challenger and 12 Learjet.
Continued progress on the aftermarket strategy drove a 14.3% revenue increase year-over-year. Further expansion of our service network was also announced with the groundbreaking for a new centre in Miami, Florida to service U.S. and Latin American customers.
During the year, Business Aircraft unveiled the new Global 5500 and Global 6500 aircraft featuring an all-new Rolls-Royce engine and a newly optimized wing, increasing the aircraft range and fuel burn performance. With flight testing at advanced stages, these performance-leading aircraft are expected to enter into service at the end of 2019.
Commercial Aircraft
In 2018, Commercial Aircraft significantly reshaped its portfolio, focusing on the CRJ Series program and its aftermarket business, while also participating in the growth of the A220 through its partnership with Airbus:
The C Series Partnership (CSALP) with Airbus closed on July 1, 2018, bringing together two complementary product lines and the benefit of Airbus’ global reach, creating significant value potential for the newly rebranded A220.
A definitive agreement was reached with Longview Aircraft Company of Canada Limited for the sale of the Q Series aircraft program assets, including aftermarket operations and assets, for gross proceeds of approximately $300 million, on November 7, 2018. The transaction is expected to close by the second half of 2019, subject to customary closing conditions and regulatory approvals. Net proceeds for this transaction are expected at approximately $250 million net of fees, liabilities and normal closing adjustments.
Revenues and aircraft deliveries for 2018 were in line with guidance on the basis of the deconsolidation of CSALP results from Commercial Aircraft since July 1, 2018.
EBIT loss before special items(11) was $157 million reflecting for the most part losses on the C Series program in the first half of the year and the post-closing CSALP equity pickup. EBIT loss of $755 million includes a $616 million pre-tax accounting charge related to the closing of the CSALP transaction.
Commercial Aircraft continues to actively participate in the regional aircraft market with the established scope-compliant CRJ Series aircraft, with a focus on reducing costs and increasing volumes while optimizing the aftermarket for the large installed base in service around the world today. As the focus is to return the program to profitability, Bombardier also announced in 2018 it is exploring strategic options for the program.
Aerostructures and Engineering Services
Aerostructures and Engineering Services is positioned as a key supplier on early life cycle growth programs, including the new A220 and Global 7500 aircraft, expected to drive sustainable growth.
In 2018, the segment revenues grew 21% year-over-year to $2.0 billion in line with guidance.
Focused execution during the ramp-up of these programs and a one-time favorable item (approximately 50 bps) associated with the closing of the C Series Partnership have enabled to deliver 9.6% EBIT before special items, above its guidance. EBIT margin for the segment was 7.5%.
On February 6, 2019, the Corporation acquired the Global 7500 aircraft wing program operations and assets from Triumph Group Inc., for a nominal cash consideration. This transaction is expected to strengthen Bombardier’s position as a leading aerostructures manufacturer, to enable the company to leverage its extensive technical expertise to support the ramp-up of the Global 7500 aircraft, and to enhance its long-term success. Bombardier will continue to operate the production line and integrate the employees currently supporting the program at Triumph’s Red Oak, Texas facility.
On February 7, 2019, Paul Sislian was appointed President, Aerostructures and Engineering Services. Paul brings more than 20 years of aerospace and industrial experience, including serving most recently as Chief Operating Officer for Bombardier Business Aircraft.
Transportation
On February 7, 2019, Danny Di Perna was appointed President, Bombardier Transportation. Danny brings more than 30 years of industrial experience to this new role. He has a proven record of success leading complex industrial projects and organizations, driving operational efficiency and improving quality. Most recently, Danny led Bombardier’s Aerostructures and Engineering Services segment.
In 2018, Transportation recorded orders totaling $9.9 billion, fueled by a $3.3 billion order intake in the fourth quarter. Book-to-bill(2) reached 1.5 for the fourth quarter, resulting in a 1.1 ratio for the full year, continuing to position the segment for growth in revenues and profitability, supported by strong industry fundamentals.
Order intake for the year reflects project wins across geographies, with notable contract awards in Europe, led by SNCF’s repeat order in France, in Asia led by the Singapore Metro contract, and North America with Airport and Mass transit mobility solutions for Phoenix and Los Angeles.
The backlog reached $34.5 billion as at December 31, 2018. The backlog growth (excluding currency fluctuations) was supported by a stronger mix of platform projects and increasing signalling and service contract orders, consistent with Transportation’s strategy to increase speed-to-market; provide customers with end-to-end solutions; de-risk project execution while also growing margins.
Subsequent to the fourth quarter, in January 2019, Transportation was awarded a contract to supply 113 new generation passenger rail cars valued at $669 million with options for up to 886 additional cars, by the New Jersey Transit Corporation.
Financial performance for 2018 positions Transportation to reach 2019 guidance:
Revenues grew 4% year-over-year to $8.9 billion, in line with guidance, supported by a favourable currency impact in the first half of the year (2% growth excluding currency impact). Services and signalling grew to over 34% of revenues for the year, as increasing focus turns to integrated customer solutions.
EBIT before special items grew to $750 million for the year, representing an 8.4% margin (EBIT of $774 million, or 8.7% margin). Fourth quarter margins before special items were 7.7% (10.9% EBIT margin), as a result of contract estimate adjustments largely associated with a legacy project, resulting in full year margins before special items, slightly below the 8.5% guidance.
As discussed at the Company’s December 2018 Investor Day, Transportation continues to advance a number of legacy projects. The Company has plans in place and is taking actions to finalize system integration, obtain homologation and align delivery schedules with customers. Bombardier expects to substantially complete deliveries on most of these projects and significantly recover working capital through 2019.
As the portfolio continues to improve, Transportation anticipates growing EBIT margins before special items to approximately 9% for 2019, in line with guidance.
CDPQ Investment in BT Holdco
The Company also announced that Transportation’s results in 2018 did not reach the performance targets underlying Caisse de dépôt et placement du Québec’s (CDPQ) investment in BT Holdco. Accordingly, for the 12-month period starting on February 12, 2019, Bombardier’s percentage of ownership on conversion of CDPQ’s shares will decrease by 2.5%, returning to the original 70%; and the preference return entitlement rate on liquidation of its shares will increase from 7.5% to 9.5% for this period. Any dividends paid by BT Holdco to its shareholders during this period will be distributed on the basis of each shareholder’s percentage of ownership upon conversion, being 70% for Bombardier and 30% for CDPQ. These adjustments will become effective once the audited consolidated financial statements of BT Holdco are duly approved by its board of directors.
Headquartered in Montréal, 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, 2018, Bombardier posted revenues of $16.2 billion. News and information are available at bombardier.com or follow us on Twitter @Bombardier.
