Bombardier Reports Fourth Quarter and Full Year 2017 Results
- Consolidated full-year EBIT before special items(1) increased 57% year-over-year to $672M - Margin(2) guidance exceeded across all business segments; full-year EBIT margins above 8% at Transportation, Business Aircraft and Aerostructures - Full year free cash flow usage(1) better than guidance by over $200M - Strong momentum continues as Company approaches midpoint in turnaround plan - Bombardier's participation in Transportation increases from 70% to 72.5% as results surpass incentive targets underlying CDPQ investment
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E-mailMONTREAL, QUEBEC -- (Marketwired) -- 02/15/18 -- Bombardier (TSX: BBD.A)(TSX: BBD.B)(OTCQX: BDRBF) today reported its fourth quarter and full year 2017 results, highlighting solid financial and operational performance across the company.
"Bombardier closed out the second full year of its five-year turnaround plan with very strong performance," said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc. "Because of this solid performance, we begin 2018 with great momentum. Our operational transformation is in full motion; our growth programs - including the Global 7000 - are on track and we have a clear line of sight to our 2020 objectives."
In 2017, Bombardier's full-year EBIT before special items grew 57% year-over-year, from $427 million to $672 million, while EBITDA before special items(1) reached close to $1 billion. Full year EBIT margins exceeded guidance at Transportation, Business Aircraft and Aerostructures. Before special items, EBIT margins(1) were 8.4% at Transportation and Business Aircraft; and 10.0% at Aerostructures. Consolidated revenues for the year were $16.2 billion, in line with our guidance.
Free cash flow performance(2) for 2017 was better than guidance by more than $200 million, with a usage of $786 million. This over performance allowed Bombardier to end the year with a $3.1 billion cash balance and well positioned to achieve cash flow breakeven in 2018(3), a key objective of the Company's turnaround plan.
"2018 will be a pivotal year for Bombardier," Bellemare continued. "We are moving out of our investment cycle and into a strong growth cycle. Our focus is on flawless execution: bringing the Global 7000 into service; delivering on our major rail projects; and closing the Airbus partnership following regulatory approvals later this year."
The company also announced that Transportation's strong results in 2017 outpaced the performance targets underlying CDPQ's investment in BT Holdco. Accordingly, for the 12-month period starting on February 12, 2018, Bombardier's percentage of ownership on conversion of CDPQ's shares will increase by 2.5%, up from 70% to 72.5%. 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 on conversion, being 72.5% for Bombardier and 27.5% for the CDPQ. These adjustments will become effective once the audited consolidated financial statements of BT Holdco are duly approved by its Board of Directors.
Selected results
For the fiscal years ended December 31 2017 2016 Variance ---------------------------------------------------------------------------- Revenues $ 16,218 $ 16,339 (1)% EBIT $ 246 $ (58) nmf EBIT margin 1.5% (0.4)% 190 bps EBIT before special items $ 672 $ 427 57% EBIT margin before special items 4.1% 2.6% 150 bps EBITDA before special items $ 993 $ 798 24% EBITDA margin before special items(1) 6.1% 4.9% 120 bps Net loss $ (553) $ (981) 44% Diluted EPS (in dollars) $ (0.25) $ (0.48) $ 0.23 Adjusted net income (loss)(1) $ 63 $ (268) nmf Adjusted EPS (in dollars)(1) $ 0.03 $ (0.15) $ 0.18 Net additions to PP&E and intangible assets $ 1,317 $ 1,201 10% Cash flows from operating activities $ 531 $ 137 288% Free cash flow usage $ (786) $ (1,064) 26% ============================================================================ As at December 31 2017 2016 Variance ---------------------------------------------------------------------------- Available short-term capital resources(4)(5) $ 4,225 $ 4,477 (6)% ============================================================================ For the fourth quarters ended December 31 2017 2016 Variance ---------------------------------------------------------------------------- Revenues $ 4,715 $ 4,380 8% EBIT $ 149 $ 74 101% EBIT margin 3.2% 1.7% 150 bps EBIT before special items $ 215 $ 104 107% EBIT margin before special items 4.6% 2.4% 220 bps EBITDA before special items $ 304 $ 203 50% EBITDA margin before special items 6.4% 4.6% 180 bps Net loss $ (109) $ (259) 58% Diluted EPS (in dollars) $ (0.05) $ (0.12) $ 0.07 Adjusted net income (loss) $ 51 $ (141) nmf Adjusted EPS (in dollars) $ 0.02 $ (0.07) $ 0.09 Net additions to PP&E and intangible assets $ 365 $ 327 12% Cash flows from operating activities $ 1,237 $ 823 50% Free cash flow $ 872 $ 496 76% ============================================================================ All amounts in this press release are in U.S. dollars, unless otherwise indicated. Amounts in tables are in millions except per share amounts, unless otherwise indicated.
SEGMENTED RESULTS AND HIGHLIGHTS
Business Aircraft
----------------------------------------------------------------------------
For the fiscal years ended December 31 2017 2016 Variance
----------------------------------------------------------------------------
Revenues $ 4,961 $ 5,741 (14)%
Aircraft deliveries (in units) 140 163 (23)
EBIT $ 391 $ 477 (18)%
EBIT margin 7.9% 8.3% (40) bps
EBIT before special items $ 416 $ 369 13%
EBIT margin before special items 8.4% 6.4% 200 bps
EBITDA before special items $ 513 $ 528 (3)%
EBITDA margin before special items 10.3% 9.2% 110 bps
Net additions to PP&E and intangible
assets $ 1,075 $ 721 49%
============================================================================
As at December 31 2017 2016 Variance
----------------------------------------------------------------------------
Order backlog (in billions of dollars) $ 14.0 $ 15.4 (9)%
============================================================================
-- Business Aircraft's 2017 financial performance met or exceeded guidance
delivering 140 aircraft. Revenues were $5.0 billion with EBIT margins
before special items of 8.4%.
-- For the fourth quarter, deliveries reached 44 units, including a strong
mix of Challenger and Global family aircraft, representing 29 and 13
deliveries respectively. These families of aircraft continued to lead
their respective market segments during the quarter.
-- The 200 bps improvement in EBIT margin before special items reflects our
continued operating discipline, and stronger contribution from the
aftermarket business, benefiting from recent investments to increase
service capacity and portfolio of offerings. In line with the
aftermarket growth strategy, revenues from these activities grew by more
than 10% in 2017.
-- Demonstrating continued focus on driving financial performance in any
market, EBIT before special items grew 35% over the past two years, from
$308 million to $416 million, even as we managed lower revenues of
approximately 30%. As such, the segment is poised to benefit from its
increased production efficiency and leaner cost structure when the
Global 7000 enters-into-service and the business aircraft market
recovers.
-- The fourth quarter of 2017 was the strongest in terms of order intake
compared to the previous three quarters of 2017, and higher than the
fourth quarters of 2016 and 2015 respectively.
-- The Global 7000 aircraft continues to perform extremely well and to
exhibit a high level of reliability. The availability of four FTVs for
the entire fourth quarter has accelerated flight testing and the fifth
and final FTV has joined the test program on January 30, 2018. The
program has cumulated over 1,500 flight test hours to date and with
multiple aircraft in final assembly, the Global 7000 aircraft is on
track for EIS in the second half of 2018.(6)
Commercial Aircraft
----------------------------------------------------------------------------
For the fiscal years ended December 31 2017 2016 Variance
----------------------------------------------------------------------------
Revenues $ 2,382 $ 2,617 (9)%
Aircraft deliveries (in units) 73 86 (13)
Net orders (in units) 70 161 (91)
Book-to-bill ratio(7) 1.0 1.9 (0.9)
EBIT $ (385) $ (903) 57%
EBIT margin (16.2)% (34.5)% 1830 bps
EBIT before special items $ (377) $ (417) 10%
EBIT margin before special items (15.8)% (15.9)% 10 bps
EBITDA before special items $ (305) $ (353) 14%
EBITDA margin before special items (12.8)% (13.5)% 70 bps
Net additions to PP&E and intangible
assets $ 107 $ 392 (73)%
============================================================================
As at December 31 2017 2016 Variance
----------------------------------------------------------------------------
Order backlog (in units) 433 436 (3)
============================================================================
-- We are moving ahead and making progress obtaining regulatory approvals
for the announced partnership with Airbus for the C Series aircraft. We
expect to obtain all approvals for the partnership in 2018, and in the
meantime, we are conducting site visits and planning for the operation
of the U.S. final assembly line in Mobile, Alabama, and working on other
integration streams, consistent with antitrust law. On January 26, 2018,
the U.S. International Trade Commission rejected Boeing's attempt to
have tariffs imposed on C Series aircraft, clearing the path for us to
support Delta this year as we work to close our partnership with Airbus.
-- We delivered 73 aircraft during the year, within the overall guidance
range, including 30 Q400, 26 CRJ, and 17 C Series aircraft. This
includes 22 aircraft in the fourth quarter, in line with the previous
year.
-- We delivered the first two CS300 aircraft to Korean Air Lines, the
program's Asian launch customer, in the final week of December 2017,
and supported their preparation for commercial service, which began
in January 2018.
-- The year was marked by a book-to-bill ratio(7) of 1.0 for Commercial
Aircraft. During the fourth quarter, we received orders across all three
aircraft families. These orders included the following:
-- On December 29, 2017, we executed a firm agreement for the sale of
12 CS300 aircraft with EgyptAir, along with purchase rights for an
additional 12 CS300 aircraft. Based on the list price of the CS300
airliner, the firm-order contract would be valued at approximately
$1.1 billion.
-- On the same day, we signed an agreement for six CRJ900 aircraft with
options for six additional CRJ900 regional jets with an unidentified
customer. Based on list price, the firm orders would be valued at
approximately $290 million.
-- We also signed two Q400 orders, for two aircraft each, with Qazaq
Air and Cemair, valued at approximately $133 million based on list
prices.
-- Commercial Aircraft's financial performance for 2017 was marked by the
continued production ramp-up of the C Series aircraft program. As
announced in our third quarter financial results, engine delivery delays
from Pratt & Whitney impacted our C Series aircraft deliveries,
particularly in the fourth quarter. While revenues reached $2.4 billion,
in line with our guidance, the EBIT loss before special items at $377
million compared favorably relative to expectations.
Aerostructures and Engineering Services
----------------------------------------------------------------------------
For the fiscal years ended December 31 2017 2016 Variance
----------------------------------------------------------------------------
Revenues $ 1,570 $ 1,549 1%
External order intake 443 392 13%
External book-to-bill ratio(8) 1.1 0.9 0.2
EBIT $ 150 $ 128 17%
EBIT margin 9.6% 8.3% 130 bps
EBIT before special items $ 157 $ 124 27%
EBIT margin before special items 10.0% 8.0% 200 bps
EBITDA before special items $ 207 $ 175 18%
EBITDA margin before special items 13.2% 11.3% 190 bps
Net additions to PP&E and intangible
assets $ 22 $ 20 10%
============================================================================
As at December 31 2017 2016 Variance
----------------------------------------------------------------------------
External order backlog $ 87 $ 42 107%
============================================================================
-- Financial performance in 2017 for the Aerostructures and Engineering
Services segment was in line with our expectations. Revenues for the
year totalled $1.6 billion, while EBIT margin before special items was
10.0%. The significant increase in EBIT margin before special items in
the fourth quarter at 15.3%, relative to guidance and the prior year,
demonstrates the positive evolution of anticipated cost reductions on
components manufactured by us for the C Series aircraft, as accounted
for under long-term contract accounting.
-- During the quarter, Aerostructures and Engineering Services announced
that it has been selected by Airbus as a supplier on a new engine
nacelle program for the Pratt & Whitney powered A320neo family of
aircraft. This contract reinforces our long-term strategy to grow our
capabilities in the nacelles market and to focus on delivering
innovative, higher value products and services.
Transportation
----------------------------------------------------------------------------
For the fiscal years ended December 31 2017 2016 Variance
----------------------------------------------------------------------------
Revenues $ 8,525 $ 7,574 13%
Order intake (in billions of dollars) $ 10.2 $ 8.5 20%
Book-to-bill ratio(9) 1.2 1.1 0.1
EBIT $ 417 $ 396 5%
EBIT margin 4.9% 5.2% (30) bps
EBIT before special items $ 712 $ 560 27%
EBIT margin before special items 8.4% 7.4% 100 bps
EBITDA before special items $ 810 $ 657 23%
EBITDA margin before special items 9.5% 8.7% 80 bps
Net additions to PP&E and intangible
assets $ 123 $ 116 6%
============================================================================
As at December 31 2017 2016 Variance
----------------------------------------------------------------------------
Order backlog (in billions of dollars) $ 34.4 $ 30.1 14%
============================================================================
-- We delivered superior financial performance in 2017, while also
positioning our segment for further growth in both revenues and
profitability.
-- Revenues grew 13% year over year to $8.5 billion, in line with
guidance.
-- EBIT margin before special items grew 100 bps, to 8.4% in 2017,
representing the fifth consecutive quarter with margins at or above
8%. With two-thirds of the transformation initiatives completed at
year-end, continued execution of the plan is expected to lead to
further margin expansion.
-- Backlog reached $34.4 billion as of December 31, 2017, fuelled by a
20% increase in order intake across all product segments primarily
in Europe and Asia-Pacific. This order activity led to a
book-to-bill(9) of 1.2 for the full year, the fourth consecutive
year with a ratio above 1.0.
-- Our products have achieved key milestones, setting the stage for
increased future deliveries and revenues including:
-- The test train for the New York City subway passed its in-service
test in December 2017, allowing the remaining cars to be delivered
and to be placed in service;
-- The first Queensland New Generation Rollingstock trains entered
passenger service along the South-East Queensland rail network in
Australia in December 2017;
-- In September 2017, the TWINDEXX Vario double deck trains for
Deutsche Bahn (DB) have received single traction homologation from
the German Federal Railway Authority (EBA) and started operational
service; and
-- In January 2018, we announced that the first rail cars for the San
Francisco Bay Area Rapid Transit District (BART) are entering
passenger service after successfully completing comprehensive
testing and receiving certification from the California Public
Utilities Commission.
-- Transportation's strong results in 2017 outpaced the performance targets
underlying CDPQ's investment in BT Holdco. Accordingly, for the 12-month
period starting on February 12, 2018, Bombardier's percentage of
ownership on conversion of CDPQ's shares will increase by 2.5%, up from
70% to 72.5%. 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 on conversion, being 72.5% for Bombardier and
27.5% for the CDPQ. These adjustments will become effective once the
audited consolidated financial statements of BT Holdco are duly approved
by its Board of Directors.
About Bombardier
With over 69,500 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, 2017, Bombardier posted revenues of $16.2 billion. News and information are available at bombardier.com or follow us on Twitter @Bombardier.
Bombardier Inc. uses its website as a channel of distribution for material company information. Financial and other material information regarding Bombardier Inc. is routinely posted on its website and accessible at bombardier.com. Investors are hereby notified information about regular dividends declared and paid by Bombardier is only made available through its website, unless otherwise required by applicable securities laws.
Bombardier, Challenger, CRJ, CRJ900, CS300, C Series, Global, Global 7000, Global 8000, Q400 and TWINDEXX are trademarks of Bombardier Inc. or its subsidiaries.
Readers are strongly advised to view a more detailed discussion of our results by segment in our Management's Discussion and Analysis and Consolidated financial statements which are posted on our website at ir.bombardier.com.
bps:basis points
nmf:information not meaningful
(1) Non-GAAP financial measures. See Caution regarding non-GAAP measures at
the end of this press release.
(2) Margin refers to EBIT before special items or EBIT margin before special
items. Free cash flow performance refers to free cash flow usage. Non-
GAAP financial measures. See Caution regarding non-GAAP measures at the
end of this press release.
(3) See the forward-looking statements disclaimer and each reportable
segment's Guidance and forward-looking statements section in the
Corporation's financial report for the fiscal year ended December 31,
2017 for details regarding the assumptions on which the guidance is
based.
(4) Defined as cash and cash equivalents plus the amount available under the
Corporation's revolving credit facilities.
(5) Following the anticipated closing of our C Series partnership with
Airbus, the assets and liabilities of the C Series aircraft program are
presented under Assets held for sale. Refer to the strategic partnership
section in Commercial Aircraft, Note 15 - Cash and cash equivalent and
Note 28 - Assets held for sale in the Corporation's 2017 Consolidated
financial statements for more details on the transaction as well as the
accounting treatment as at December 31, 2017.
(6) See the Global 7000 and Global 8000 aircraft program disclaimer in the
MD&A of the Corporation's financial report for the fiscal year ended
December 31, 2017.
(7) Ratio of net orders received over aircraft deliveries, in units.
(8) Ratio of new external orders over external revenues.
(9) Ratio of new orders over revenues.
CAUTION REGARDING NON-GAAP MEASURES
This press release is based on reported earnings in accordance with International Financial Reporting Standards (IFRS). Reference to generally accepted accounting principles (GAAP) means IFRS, unless indicated otherwise. This press release is also based on non-GAAP financial measures including EBITDA, EBIT before special items and EBITDA before special items, adjusted net income, adjusted earnings per share and free cash flow. These non-GAAP measures are mainly derived from the consolidated financial statements but do not have standardized meanings prescribed by IFRS; therefore, others using these terms may define them differently. Management believes that providing certain non-GAAP performance measures, in addition to IFRS measures, provides users of our Financial Report with enhanced understanding of our results and related trends and increases the transparency and clarity of the core results of our business. Refer to the Non-GAAP financial measures and Liquidity and capital resources sections in Overview and each reporting segments' Analysis of results sections in the Corporation's MD&A for definitions of these metrics and reconciliations to the most comparable IFRS measures.
Reconciliation of segment to consolidated results
============================================================================
Fourth quarters Fiscal years
ended December 31 ended December 31
----------------------------------------------------------------------------
2017 2016 2017 2016
----------------------------------------------------------------------------
Revenues
Business Aircraft $ 1,473 $ 1,651 $ 4,961 $ 5,741
Commercial Aircraft 677 699 2,382 2,617
Aerostructures and Engineering
Services 413 319 1,570 1,549
Transportation 2,493 1,948 8,525 7,574
Corporate and Elimination (341) (237) (1,220) (1,142)
----------------------------------------------------------------------------
$ 4,715 $ 4,380 $ 16,218 $ 16,339
============================================================================
EBIT before special items
Business Aircraft $ 120 $ 100 $ 416 $ 369
Commercial Aircraft (142) (141) (377) (417)
Aerostructures and Engineering
Services 63 30 157 124
Transportation 217 181 712 560
Corporate and Elimination (43) (66) (236) (209)
----------------------------------------------------------------------------
$ 215 $ 104 $ 672 $ 427
----------------------------------------------------------------------------
Special Items
Business Aircraft $ (9) $ 1 $ 25 $ (108)
Commercial Aircraft 5 3 8 486
Aerostructures and Engineering
Services 13 6 7 (4)
Transportation 11 20 295 164
Corporate and Elimination 46 - 91 (53)
----------------------------------------------------------------------------
$ 66 $ 30 $ 426 $ 485
----------------------------------------------------------------------------
EBIT
Business Aircraft $ 129 $ 99 $ 391 $ 477
Commercial Aircraft (147) (144) (385) (903)
Aerostructures and Engineering
Services 50 24 150 128
Transportation 206 161 417 396
Corporate and Elimination (89) (66) (327) (156)
----------------------------------------------------------------------------
$ 149 $ 74 $ 246 $ (58)
============================================================================
Reconciliation of EBITDA before special items and EBITDA to EBIT
============================================================================
Fourth quarters Fiscal years
ended December 31 ended December 31
----------------------------------------------------------------------------
2017 2016 2017 2016
----------------------------------------------------------------------------
EBIT $ 149 $ 74 $ 246 $ (58)
Amortization 89 99 314 371
Impairment charges on PP&E and
intangible assets(1) 6 10 51 10
----------------------------------------------------------------------------
EBITDA 244 183 611 323
Special items excluding impairment
charges on PP&E and intangible
assets(1) 60 20 382 475
----------------------------------------------------------------------------
EBITDA before special items $ 304 $ 203 $ 993 $ 798
============================================================================
(1) Refer to the Consolidated results of operations section in the
Corporation's MD&A for details regarding special items.
Computation of diluted EPS
============================================================================
Fourth quarters Fiscal years
ended December 31 ended December 31
----------------------------------------------------------------------------
2017 2016 2017 2016
----------------------------------------------------------------------------
Net loss attributable to
equity holders of
Bombardier Inc. $ (108) $ (251) $ (516) $ (1,022)
Preferred share dividends,
including taxes (8) (14) (27) (32)
----------------------------------------------------------------------------
Net loss attributable to
common equity holders of
Bombardier Inc. $ (116) $ (265) $ (543) $ (1,054)
----------------------------------------------------------------------------
Weighted-average diluted
number of common shares
(in thousands of shares) 2,194,868 2,194,304 2,195,379 2,212,547
----------------------------------------------------------------------------
Diluted EPS (in dollars) $ (0.05) $ (0.12) $ (0.25) $ (0.48)
----------------------------------------------------------------------------
Computation of adjusted EPS
============================================================================
Fourth quarters Fiscal years
ended December 31 ended December 31
----------------------------------------------------------------------------
2017 2016 2017 2016
----------------------------------------------------------------------------
Adjusted net income (loss)$ 51 $ (141) $ 63 (268)
Net (income) loss
attributable to NCI 1 8 37 (41)
Preferred share dividends,
including taxes (8) (14) (27) (32)
Dilutive impact of CDPQ
conversion option (2) - - -
----------------------------------------------------------------------------
Adjusted net income (loss)
attributable to equity
holders of Bombardier
Inc. $ 42 $ (147) $ 73 $ (341)
----------------------------------------------------------------------------
Weighted-average adjusted
diluted number of common
shares (in thousands of
shares) 2,311,057 2,194,304 2,264,722 2,212,547
----------------------------------------------------------------------------
Adjusted EPS (in
dollars)(1) $ 0.02 $ (0.07) $ 0.03 $ (0.15)
----------------------------------------------------------------------------
(1) Refer to the Non-GAAP financial measures section in the MD&A of the
Corporation's financial report for the fiscal year ended December 31,
2017 for definitions of these metrics and reconciliations to the most
comparable IFRS measures.
Reconciliation of adjusted net income (loss) to net loss and computation of
adjusted EPS
============================================================================
Fourth quarters ended December 31
----------------------------------------------------------------------------
2017 2016
----------------------------------------------------------------------------
(per share) (per share)
----------------------------------------------------------------------------
Net loss $ (109) $ (259)
Adjustments to EBIT related to
special items(1) 66 $ 0.03 30 $ 0.01
Adjustments to net financing
expense related to:
Loss on repurchase of long-term
debt(1) 23 0.01 86 0.04
Accretion on net retirement
benefit obligations 19 0.01 16 0.01
Net change in provisions arising
from changes in interest rates
and net loss on certain
financial instruments 57 0.02 (12) (0.01)
Tax impact of special(1) and other
adjusting items (5) 0.00 (2) 0.00
----------------------------------------------------------------------------
Adjusted net income (loss) 51 (141)
Net loss attributable to NCI 1 8
Preferred share dividends,
including taxes (8) (14)
Dilutive impact of CDPQ conversion
option (2) -
----------------------------------------------------------------------------
Adjusted net income (loss)
attributable to equity holders of
Bombardier Inc. $ 42 $ (147)
============================================================================
Weighted-average adjusted diluted
number of common shares (in
thousands) 2,311,057 2,194,304
============================================================================
Adjusted EPS $ 0.02 $ (0.07)
============================================================================
Reconciliation of adjusted EPS to diluted EPS (in dollars)
============================================================================
Fourth quarters ended
December 31
----------------------------------------------------------------------------
2017 2016
----------------------------------------------------------------------------
Diluted EPS $ (0.05) $ (0.12)
Impact of special(1) and other adjusting items 0.07 0.05
----------------------------------------------------------------------------
Adjusted EPS $ 0.02 $ (0.07)
============================================================================
Reconciliation of adjusted net income (loss) to net loss and computation of
adjusted EPS
============================================================================
Fiscal years ended December 31
----------------------------------------------------------------------------
2017 2016
----------------------------------------------------------------------------
(per share) (per share)
----------------------------------------------------------------------------
Net loss $ (553) $ (981)
Adjustments to EBIT related to
special items(1) 426 $ 0.19 485 $ 0.22
Adjustments to net financing
expense related to:
Loss on repurchase of long-term
debt(1) 23 0.01 86 0.04
Accretion on net retirement
benefit obligations 78 0.04 66 0.03
Net change in provisions
arising from changes in
interest rates and net loss
(gain) on certain financial
instruments(1) 95 0.04 63 0.03
Interest portion of gains
related to special items(1) 11 0.01 26 0.01
Transaction costs related to
the conversion option embedded
in the CDPQ investment(1) - - 8 0.01
Tax impact of special(1) and
other adjusting items (17) (0.01) (21) (0.01)
----------------------------------------------------------------------------
Adjusted net income (loss) 63 (268)
Net (income) loss attributable to
NCI 37 (41)
Preferred share dividends,
including taxes (27) (32)
----------------------------------------------------------------------------
Adjusted net income (loss)
attributable to equity holders of
Bombardier Inc. $ 73 $ (341)
============================================================================
Weighted-average adjusted diluted
number of common shares (in
thousands) 2,264,722 2,212,547
============================================================================
Adjusted EPS $ 0.03 $ (0.15)
============================================================================
(1) Refer to the Consolidated results of operations section in the MD&A of
the Corporation's financial report for the fiscal year ended December
31, 2017 for details regarding special items.
Reconciliation of adjusted EPS to diluted EPS (in
dollars)
============================================================================
Fiscal years ended
December 31
----------------------------------------------------------------------------
2017 2016
----------------------------------------------------------------------------
Diluted EPS $ (0.25) $ (0.48)
Impact of special(1) and other adjusting items 0.28 0.33
----------------------------------------------------------------------------
Adjusted EPS $ 0.03 $ (0.15)
============================================================================
(1) Refer to the Consolidated results of operations section in the MD&A of
the Corporation's financial report for the fiscal year ended December
31, 2017 for details regarding special items.
Reconciliation of free cash flow usage to cash flows from operating
activities
============================================================================
Fourth quarters Fiscal years
ended December 31 ended December 31
----------------------------------------------------------------------------
2017 2016 2017 2016
----------------------------------------------------------------------------
Cash flows from operating
activities $ 1,237 $ 823 $ 531 $ 137
Net additions to PP&E and
intangible assets (365) (327) (1,317) (1,201)
----------------------------------------------------------------------------
Free cash flow (usage) $ 872 $ 496 $ (786) $ (1,064)
============================================================================
FORWARD-LOOKING STATEMENTS
This press release includes forward-looking statements, which may involve, but are not limited to: statements with respect to the Corporation's objectives, guidance, targets, goals, priorities, market and strategies, financial position, beliefs, prospects, plans, expectations, anticipations, estimates and intentions; general economic and business outlook, prospects and trends of an industry; expected growth in demand for products and services; product development, including projected design, characteristics, capacity or performance; expected or scheduled entry-into-service of products and services, orders, deliveries, testing, lead times, certifications and project execution in general; competitive position; the expected impact of the legislative and regulatory environment and legal proceedings on the Corporation's business and operations; available liquidities and ongoing review of strategic and financial alternatives; the completion, anticipated timing of the transaction with Airbus SE (Airbus) described herein and the receipt of regulatory and other approvals required with respect to this transaction and the anticipated timing thereof; the governance, funding and liquidity of C Series Aircraft Limited Partnership (CSALP); the impact and expected benefits of the transaction with Airbus described herein, on our operations, infrastructure, capabilities, development, growth and other opportunities, geographic reach, scale, footprint, financial condition, access to capital and overall strategy; and the impact of such transaction on our balance sheet and liquidity position.
Forward-looking statements can generally be identified by the use of forward-looking terminology such as "may", "will", "shall", "can", "expect", "estimate", "intend", "anticipate", "plan", "foresee", "believe", "continue", "maintain" or "align", the negative of these terms, variations of them or similar terminology. Forward-looking statements are presented for the purpose of assisting investors and others in understanding certain key elements of our current objectives, strategic priorities, expectations and plans, and in obtaining a better understanding of our business and anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes.
By their nature, forward-looking statements require management to make assumptions and are subject to important known and unknown risks and uncertainties, which may cause our actual results in future periods to differ materially from forecast results set forth in forward-looking statements. While management considers these assumptions to be reasonable and appropriate based on information currently available, there is risk that they may not be accurate. The assumptions underlying the forward-looking statements made in this press release in relation to the transaction with Airbus discussed herein include the following material assumptions: the satisfaction of all conditions of closing and the successful completion of the transaction within the anticipated timeframe, including receipt of regulatory (including antitrust) and other approvals; the fulfillment and performance by each party of its obligations pursuant to the transaction agreement and future commercial agreements and absence of significant inefficiencies and other issues in connection therewith; the realization of the anticipated benefits and synergies of the transaction in the timeframe anticipated; our ability to continue with our current funding plan of CSALP and to fund, if required, any cash shortfalls; adequacy of cash planning and management and project funding; and the accuracy of our assessment of anticipated growth drivers and sector trends. For additional information with respect to the assumptions underlying the forward-looking statements made in this press release, refer to the Strategic Priorities and Guidance and forward-looking statements sections for each reportable segment in the MD&A of the Corporation's financial report for the fiscal year ended December 31, 2017.
With respect to the transaction with Airbus discussed herein specifically, certain factors that could cause actual results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, risks associated with the failure to receive or delay in receiving regulatory (including antitrust) or other approvals or otherwise satisfy the conditions to the completion of the transaction or delay in completing the transaction and uncertainty regarding the length of time required to complete the transaction; changes in the terms of the transaction; the failure by either party to satisfy and perform its obligations pursuant to the transaction agreement and future commercial agreements and/or significant inefficiencies and other issues arising in connection therewith; the impact of the announcement of the transaction on our relationships with third parties, including commercial counterparties, employees and competitors, strategic relationships, operating results and businesses generally; the failure to realize, in the timeframe anticipated or at all, the anticipated benefits and synergies of the transaction; our ability to continue with our current funding plan of CSALP and to fund, if required, the cash shortfalls; inadequacy of cash planning and management and project funding.
Certain other factors that could cause actual results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, risks associated with general economic conditions, risks associated with our business environment (such as risks associated with "Brexit", the financial condition of the airline industry, business aircraft customers, and the rail industry; trade policy (including potential changes to or the termination of the existing North American Free Trade Agreement between Canada, the U.S. and Mexico currently in discussion); increased competition; political instability and force majeure events or natural disasters), operational risks (such as risks related to developing new products and services; development of new business; the certification and homologation of products and services; fixed-price and fixed-term commitments and production and project execution; pressures on cash flows and capital expenditures based on project-cycle fluctuations and seasonality; our ability to successfully implement and execute our strategy and transformation plan; doing business with partners; product performance warranty and casualty claim losses; regulatory and legal proceedings; environmental, health and safety risks; dependence on certain customers and suppliers; human resources; reliance on information systems; reliance on and protection of intellectual property rights; and adequacy of insurance coverage), financing risks (such as risks related to liquidity and access to capital markets; retirement benefit plan risk; exposure to credit risk; substantial existing debt and interest payment requirements; certain restrictive debt covenants and minimum cash levels; financing support provided for the benefit of certain customers; and reliance on government support), market risks (such as risks related to foreign currency fluctuations; changing interest rates; decreases in residual values; increases in commodity prices; and inflation rate fluctuations). For more details, see the Risks and uncertainties section in Other in the Management's Discussion and Analysis (MD&A) of the Corporation's financial report for the fiscal year ended December 31, 2017. For additional information with respect to the assumptions underlying the forward-looking statements made in this press release, refer to the Guidance and forward-looking statements sections in Overview, Business Aircraft, Commercial Aircraft, Aerostructures and Engineering Services, and Transportation in the MD&A of the Corporation's financial report for the fiscal year ended December 31, 2017.
Readers are cautioned that the foregoing list of factors that may affect future growth, results and performance is not exhaustive and undue reliance should not be placed on forward-looking statements. Other risks and uncertainties not presently known to us or that we presently believe are not material could also cause actual results or events to differ materially from those expressed or implied in our forward-looking statements. In addition, there can be no assurance that the proposed transaction with Airbus will occur or that the anticipated strategic benefits and operational, competitive and cost synergies will be realized in their entirety, in part or at all. The forward-looking statements set forth herein reflect management's expectations as at the date of this press release and are subject to change after such date. Unless otherwise required by applicable securities laws, the Corporation expressly disclaims any intention, and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement.
Contacts: Bombardier Inc. Simon Letendre Senior Advisor, Media Relations and Public Affairs +514 861 9481 www.bombardier.com Bombardier Inc. Patrick Ghoche Vice President, Investor Relations +514 861 5727 www.bombardier.com
Source: Bombardier Inc.
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