Bombardier says it is making the investment to both “complete the late-stage, legacy projects and protect the delivery schedule for other projects.” The funds will be used to increase both manufacturing and engineering capacity at Bombardier Transportation facilities.
Consolidated group revenues grew by 9% to $US 4.3bn in the second quarter, with the increase driven primarily by higher aircraft deliveries and growth in the aftermarket segment. Bombardier also completed the sale of its Q Series aircraft and announced the sale of its CRJ regional jet to Mitsubishi Heavy Industries.
Revenues in the Transportation division increased 2% year-on-year to $US 2.2bn. The adjusted Ebit margin of 5.1% was below target, reflecting additional cost pressure on large, late-stage projects, mainly in Britain, Germany and Switzerland.
The division’s order backlog increased to $US 33.6bn and Bombardier says its positive market outlook for the rail industry remains unchanged.
The group’s adjusted core earnings forecast for the 2019 financial year has been revised from $US 1.5-1.65bn to $US 1.2-1.3bn. Bombardier’s forecast full-year adjusted Ebit has also dropped from around $US 1bn to $US 700-800m, with the adjusted Ebit margin down from 8% to around 5%.
