Bombardier Transportation’s order intake was $US 4.5bn, up 137% from $US 1.9bn during the same period last year. Bombardier says the transportation division is gradually turning the corner on large, legacy projects as it makes progress against key project milestones.
Deliveries increased approximately 15% over the previous quarter, which Bombardier says positions the business to further accelerate the release of excess working capital starting in the fourth quarter and into 2020 and 2021. To achieve this, Bombardier Transportation is nearing completion of software testing and certification for British train orders while completing production and is continuing to drive stronger in-service reliability in Switzerland and Germany to trigger customer acceptance of trains in operation.
Longer term, the turnaround in the division is being supported by the redeployment of resources, investment in additional capacity and a strengthened management team, resting on a solid backlog and order intake which Bombardier says is driving confidence in the long-term prospects of the business.
Bombardier Transportation remains on track to fulfil its full year revenue guidance of approximately $US 8.75bn, assuming a 1.12 € to $US exchange rate.
Bombardier Transportation’s adjusted Ebit margin for the quarter was 5.1%, in line with full-year guidance of approximately 5%. Bombardier says this reflects a concentration of large, late-stage projects and includes the costs associated with planned investments in manufacturing and engineering capacity announced earlier this year. The reported Ebit margin for the quarter is 4%.
Bombardier Transportation’s order backlog grew to $US 35.1bn during the quarter, with $US 4.5bn order intake driving a book-to-bill ratio of 2.1. For the first nine months of the year, Bombardier Transportation's order intake was $US 8.1bn, with a strong mix of projects, services and signalling orders. Bombardier says improving the backlog mix by replacing legacy projects with lower-risk projects is key to its return to stronger financial performance.
Orders include a contract awarded to Bombardier, Orascom Construction and Arab Contractors to supply and operate two monorail lines in Cairo, Egypt. Bombardier’s share of the contract is worth $US 2.64bn. The project will be based on Bombardier’s Innovia monorail platform through an integrated offering of rolling stock and systems, signalling and services solutions.
