Profits chug downwards at train and plane maker Bombardier
BOMBARDIER reported a sharp drop in first-quarter sales and profit yesterday, as aircraft deliveries declined and the company completed some big train orders, sending its stock lower.
The Montreal-based plane and train maker, which warned in March that aircraft deliveries would dip in 2012, said revenue fell 25 per cent as it introduced new aircraft and ramped up deliveries on complex new train orders.
Looking ahead, the world’s third biggest commercial plane maker said new orders are picking up and its backlog is healthy.
First-quarter profit fell 14 per cent to $190m (£118m), compared to $220m in the previous fiscal year. Revenue declined 25 per cent to $3.5bn, down from $4.7bn. Earnings before financing expense, financing income and income taxes (Ebit) amounted to $215m.
While profit matched analysts’ expectations, revenue fell far short of the consensus estimates.
“Certainly the results across the board are weak. We weren’t expecting a lot and we didn’t get much,” said PI Financial analyst Chris Murray. The company said lower revenues were anticipated, but it was able to contain costs to maintain profitability.