Seoul, South Korea, October 16, 2023 – Embraer SA (NYSE: ERJ) Defense & Security products and solutions, with one of the most comprehensive portfolios and innovative solutions for the defense and security markets, will be presenting at ADEX 2023 in Seoul, South Korea. Embraer’s solutions are present in more than 60 countries, include the C-390 Millennium multi-mission transport aircraft and the A-29 Super Tucano light attack and training aircraft, in addition to broader solutions for air, land, sea, and space domains.
Last year, Embraer signed several Memorandum of Understanding with Korean aerospace companies AeroSpace Technology of Korea (KOSDAQ: 067390), EMKorea Co Ltd (KOSDAQ: 095190), and Kencoa Aerospace Corp (KOSDAQ: 274090) with the objective of strengthening collaboration with Korean defense industry partners for the future supply of parts for the Embraer C-390 Millennium aircraft.
The C-390 Millennium is currently under operation with the Brazilian Air Force (FAB), where the existing fleet is presenting operational availability of 80% and mission accomplishment rates in excess of 99%, demonstrating exceptional productivity for this aircraft segment. Besides Brazil, Portugal, Hungary, the Netherlands and most recently Austria have selected the C-390 to modernize their military transport aircraft fleets.
All six Super Tucano aircraft ordered by The Philippine Air Force (PAF) have been officially handed over to the Air Force today. The aircraft will be deployed for close air support, light attack, surveillance, air-to-air interception, counter-insurgency missions, advanced training and are part of PAF’s ongoing modernization plan.
“The Philippine Air Force takes pride in welcoming the six A-29B Super Tucano from Embraer Defense and Security into the blue fold of our skies as part of our fleet. The addition of these close air support aircraft is a great leap in our air power capability as we soar together in our flight to a more capable and credible Air Force for the nation and its people,” Lieutenant General Allen T. Paredes AFP, Commanding General of the Philippine Air Force.
“It is an honour to deliver these six A-29 Super Tucanos to The Philippine Air Force,” said Jackson Schneider, President and CEO of Embraer Defense & Security. “Delivering an aircraft amidst a global pandemic is challenging, but we were committed to go the extra mile every step of the way to have the aircraft in the hands of PAF to fulfil their security missions.”
These aircraft will be operated and maintained by the 15th Strike Wing, the PAF’s end-user. In November 2017, a firm order of six A-29 Super Tucano light attack and advanced training aircraft for the Philippine Air Force (PAF) was made after a comprehensive public bidding process.
The A-29 Super Tucano is a durable, versatile and powerful turboprop aircraft capable of carrying out a wide range of missions, even operating from unimproved runways. To date, the Super Tucano was selected by 15 air forces worldwide.
Jacksonville, EUA, April 17, 2020 – Embraer Defense & Security and Sierra Nevada Corporation (SNC) announced the first of 12 A-29 Super Tucano light attack, combat and reconnaissance aircraft for the Nigerian Air Force (NAF) successfully completed its inaugural flight at the production facility in Jacksonville, Florida.
The full fleet of A-29 Super Tucano aircraft for the NAF are currently in production by SNC and Embraer at the Jacksonville facility with delivery to the NAF expected on schedule in 2021.
The NAF A-29 aircraft will now begin mission modification and final testing in Centennial, Colorado. Following final testing, before delivery, NAF pilots will train in the aircraft.
“This is an exciting milestone in the production of these A-29s for the Nigerian Air Force. The Jacksonville production line is active, and Embraer and SNC look forward to seeing these aircraft continue to roll off the line in the coming months,” says Jackson Schneider, president & CEO, Embraer Defense & Security.
“The aircraft met or exceeded all the requirements and we are very pleased with the successful flight,” stated Ed Topps, vice president of Tactical Aircraft Systems and programs for SNC’s IAS business area. “SNC and our partner, Embraer, are certain the Nigerian Air Force will be pleased with these aircraft.”
The combat-proven A-29 Super Tucano is the gold standard of light attack combat and reconnaissance aircraft around the world and is designed and built for the mission in Nigeria.
The A-29 Super Tucano is the most reliable and cost-effective solution for basic and advanced flight and combat training, close air support operations, Intelligence, Surveillance, and Reconnaissance (ISR), armed over-watch, counterinsurgency and irregular warfare scenarios.
The aircraft has already been selected by 15 air forces around the world to deliver cost-effective close air support and reconnaissance capabilities.
In December 2018, SNC and Embraer Defense & Security were awarded the contract to deliver 12 A-29 Super Tucano light attack aircraft to the Nigerian Air Force. The contract for the NAF includes ground training devices, mission planning systems, mission debrief systems, spares, ground support equipment, alternate mission equipment, contiguous U.S. interim contractor support, outside of continental U.S. (OCONUS) contractor logistic support and field service representatives for OCONUS support.
São José dos Campos, SP, Brazil, May 3rd, 2019 – Embraer (NYSE: ERJ; B3: EMBR3;) delivered a total of 22 jets in the first quarter of 2019 (1Q19), of which 11 were commercial aircraft and 11 were executive jets (8 light and 3 large). As of March 31st, the firm order backlog totaled USD 16.0 billion.
In the first quarter, Embraer delivered the first E175 jet to Mauritania Airlines, the first of this model to the African continent. The airline signed a firm order for two E175 jets in 2018. The contract has a value of USD 93.8 million at current list prices.
Embraer also signed, in April, a firm order for 10 E195-E2 jets with Nigeria’s largest airline, Air Peace, which will become the first E-Jets E2 operator in Africa. The contract includes purchase rights for a further 20 E195-E2. With all purchase rights being exercised, the contract has a value of USD 2.12 billion based on current list prices. This order will be included in Embraer’s 2Q19 backlog.
The world’s best-selling light jet for the seventh consecutive year, the Phenom 300 reached the mark of the 500th aircraft delivered, becoming the only business jet model to reach this milestone in the last 10 years. The aircraft is in operation in more than 30 countries and has accumulated more than 780,000 flight hours. This milestone followed the announcement of the first Phenom 300E and Praetor 600 business jet sales to Brazilian customers.
Embraer Defense & Security and its partner Sierra Nevada Corporation (SNC) announced in February a contract for 12 A-29 Super Tucano light attack aircraft to the Nigerian Air Force. This sale was already included in Embraer’s 4Q18 backlog.
In the period, the Brazilian Navy also announced that the Águas Azuis Consortium, formed by thyssenkrupp Marine Systems, Embraer Defense & Security and Atech, was selected for the construction of four defense ships in the Tamandaré Corvettes Class Program (CCT) as preferred bidder.
In the Services & Support segment, Embraer and WDL Aviation GmbH, a German charter business which is part of the Zeitfracht logistics group, signed an agreement for a Flight Hour Pool Program to support the airline’s recently leased fleet of four used E190s. Air Astana, a flag carrier of Kazakhstan, also signed a multiyear agreement for a Flight Hour Pool Program to support the component needs for the airline’s new E2 fleet, Embraer’s second generation of the E-Jets family of commercial aircraft.
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About Embraer
A global aerospace company headquartered in Brazil, Embraer celebrates its 50th anniversary with businesses in Commercial and Executive aviation, Defense & Security and Agricultural Aviation. The company designs, develops, manufactures and markets aircraft and systems, providing Services & Support to customer after-sales.
Since it was founded in 1969, Embraer has delivered more than 8,000 aircraft. On average, about every 10 seconds an aircraft manufactured by Embraer takes off somewhere in the world, transporting over 145 million passengers a year.
Embraer is the leading manufacturer of commercial jets up to 150 seats and the main exporter of high value-added goods in Brazil. The company maintains industrial units, offices, service and parts distribution centers, among other activities, across the Americas, Africa, Asia and Europe.
São Paulo, Brazil, February 6th, 2019 – Embraer Defense & Security and its partner Sierra Nevada Corporation (SNC) were awarded a contract to deliver 12 A-29 Super Tucano light attack aircraft to the Nigerian Air Force.
“SNC is proud to work with our partner, Embraer Defense & Security, to build A-29s in support of the Nigerian Air Force in addressing their on-going training and security needs,” said Taco Gilbert, Senior Vice President of ISR, Aviation and Security (IAS) at SNC. “The combat-proven A-29 is designed and built for the mission in Nigeria. It’s the most reliable and cost-effective solution for basic and advanced flight and combat training, close air support operations, ISR (Intelligence, Surveillance, and Reconnaissance), counterinsurgency and irregular warfare scenarios.”
“The A-29 Super Tucano has become the global reference for light attack and advanced training with a proven track record in several combat zones around the world”, said Jackson Schneider, President and CEO of Embraer Defense & Security. “Embraer welcomes Nigeria as the latest member of this true international coalition that is helping bring peace to the world.” The A-29 is conducting combat missions on a daily basis in theaters around the world. It has more than 46,000 combat hours and more than 360,000 total flight hours. With the Nigeria order, the A-29 is the choice of 14 air forces worldwide.
In addition to its combat record, the A-29’s robust landing gear and enhanced clearance enable take-off and landing in even the most austere field conditions. The aircraft also offers exceptional dependability and accuracy in weapons delivery, making it highly effective in the light attack role.
The contract for the Nigerian Air Force includes ground training devices, mission planning systems, mission debrief systems, spares, ground support equipment, alternate mission equipment, contiguous U.S. interim contractor support, outside of continental U.S. (OCONUS) contractor logistic support and field service representatives for OCONUS support.
The aircraft will be produced in Jacksonville, Florida, and modified in Centennial, Colorado. The aircraft are expected to be delivered to Nigeria in line with the contract timelines, as part of a larger more comprehensive training and support package.
São José dos Campos, Brazil, January 16, 2019 – Embraer today presents its preliminary forecast for 2019 and 2020 at a meeting with investors at the New York Stock Exchange (NYSE). For 2019, Embraer expects to deliver between 85 and 95 commercial jets, 90 to 110 executive jets, including light and large jets, 10 A-29 Super Tucano aircraft and two multi-mission KC390 aircraft. Total consolidated revenues should be between US$ 5.3 billion and US$ 5.7 billion.
The Company expects to achieve a consolidated EBIT margin of breakeven (approximately zero) for the year 2019. It is important to highlight that 2019 guidance includes potential costs and expenses associated with the creation of the Commercial Aviation JV in a strategic partnership between the Company and The Boeing Co. (“Boeing”) under the terms of the associated material facts published by Embraer.
With the finalization and closure of the partnership operation described above, tentatively expected to occur by the end of 2019, Embraer anticipates a capital structure without leverage, with a net cash position of approximately US$ 1.0 billion after the payment of a special dividend to shareholders of roughly US$ 1.6 billion (which remains subject to the confirmation of certain requirements, including the fiscal year results).
During the event in New York, Embraer also presents its guidance for the year 2020, the first year after the potential closure of the operation creating the strategic partnership between Embraer and Boeing in Commercial Aviation, as mentioned above. The guidance presented for 2020 includes 100% of the expected results of the Executive Jets and Defense & Security segments (and the results of their respective services and support businesses) and exclude expected financial results coming from the 20% stake Embraer will have in the Commercial Aviation JV in partnership with Boeing.
Embraer expects to have net revenues of between US$ 2.5 billion and US$ 2.8 billion, EBIT margin of between 2% and 5% and roughly breakeven free cash flow for the year 2020.
2018 Estimates Revision Embraer is revising its 2018 guidance for executive jet deliveries, Revenues, Executive Jet revenues, Defense & Security revenues, consolidated and adjusted EBIT, consolidated and adjusted EBIT margin, consolidated and adjusted EBITDA, consolidated and adjusted EBITDA margin, Free Cash Flow and Investments.
Global market conditions for executive jets, although gradually improving, continue to recover more slowly than expected. In combination, Embraer’s increased focus on improving profitability and price preservation, as well as the recent launch of the new midsize/super midsize executive jets (“Praetors”), which will begin delivering in 2019, led the Company to adopt a more cautious approach towards deliveries in 2018. As a result, Embraer delivered 91 total executive jets in 2018 (compared to guidance of 105-125 jets previously).
As a result of the reduction in executive jet deliveries, the Company now expects revenues in the executive jets segment to be approximately US$ 1.1 billion (previously US$ 1.35 billion – US$ 1.50 billion). In addition, the cost base revision for the KC-390 contract in the second quarter of 2018, resulting from the incident involving prototype 001 in May 2018, negatively impacted revenues for the Defense & Security segment. This impact led to a new projection for revenues for the segment, of approximately US$ 0.6 billion (US$ 0.8 billion – US$ 0.9 billion previously). As a result, Embraer’s consolidated revenues for 2018 are now expected to be approximately US$ 5.1 billion, a reduction from the previous range of US$ 5.4 billion – US$ 5.9 billion.
Guidance for consolidated and adjusted EBIT, consolidated and adjusted EBIT margin, consolidated and adjusted EBITDA, and consolidated and adjusted EBITDA margin for 2018 were lowered due largely to lower fixed cost dilution of the Company as a function of lower executive jet volumes and a decline in Defense & Security revenues. The adjusted values for 2018 exclude the impact of US$ 127.2 million related to the cost base revision of the KC-390 contract in the second quarter of 2018, following the incident involving prototype 001 in May 2018.
Embraer also estimates that its spending on investments for 2018 will be roughly US$ 300 million, below its previous expectation for a total of US$ 550 million. It is important to note that the lower spending on investments has not negatively impacted the Company’s ongoing development projects.
As a result of the lower executive jet deliveries, partially offset by the lower spending on investments in 2018, the Company expects that 2018 Free cash flow will be a use of cash of roughly US$ 200 million (versus a use of no more than US$ 100 million in its previous guidance).
