Financial Results of Bombardier Inc. for the Third
Quarter and the Nine Months Ended Oct. 31, 2001
MONTREAL, QUEBEC--NOVEMBER 20, 2001 - 16:07 EST
/T/
* Q3 consolidated revenues rise 30% to $5.0 billion
* Income climbs 12% to $379.8 million, before special items, income
taxes and goodwill amortization
* Backlog reaches $45.9 billion
/T/
Bombardier Inc. today reported consolidated revenues of $5.0
billion for the three months ended Oct. 31, 2001, an increase of
30% over revenues of $3.9 billion for the third quarter of 2000.
Income before special items, income taxes and goodwill
amortization for the latest period increased 12% to $379.8
million, compared with income of $338.3 million on the same basis
for the preceding year. Earnings per share before special items
and goodwill amortization rose to $0.18, compared with $0.16 on
the same basis for the previous year. After the net effect of the
special items and goodwill amortization, net loss for the quarter
amounted to $367.6 million, or $0.27 per share, against a net
income of $225.9 million, or $0.16 per share on the same basis in
the third quarter of last year.
For the nine months ended Oct. 31, 2001, consolidated revenues
totalled $14.0 billion, a 32% increase over revenues of $10.5
billion for the same period last year. Income before special
items, income taxes and goodwill amortization rose to $1.2
billion, an increase of 24% compared to an income of $945.2
million on the same basis for the previous year. Earnings per
share before special items and goodwill amortization, for the
nine-month period, rose to $0.57 from $0.45 the previous year, a
27% increase. After the net effect of the special items and
goodwill amortization, net income for the nine-month period
amounted to $161.3 million, or $0.11 per share, compared to $627.4
million on the same basis, or $0.45 per share, for the nine months
ended Oct. 31, 2000.
Bombardier's order backlog at Oct. 31, 2001 totalled $45.9
billion, compared with a backlog of $30.5 billion at Oct. 31, last
year.
"These results for the first nine months of the year are in line
with our revised earnings per share target of 15% growth for
fiscal 2001-2002 before special items and goodwill amortization,
as adjusted on Sept. 26, 2001," said Robert E. Brown, Bombardier's
president and chief executive officer.
Mr. Brown observed that: "In aerospace, while the deliveries of
regional aircraft were satisfactory, business aircraft sales and
deliveries were affected by the general economic conditions and
the aftermath of the September 11 events. We are aiming at
recovering the situation in the fourth quarter while recognizing
that we have to deliver a considerable number of business aircraft
in a difficult environment. The sustained slowdown in the
economy, and a difficult period for the commercial airline
industry in North America, have lead us to adopt a cautious
attitude."
"The growth in third quarter revenues results from the
consolidation of the accounts of Adtranz. It also reflects the
new outboard engine activities in the recreational products
sector."
"Our results demonstrate how the diversity of our markets around
the world, and of our products and services, is giving us comfort
in facing the future with confidence and determination," added Mr.
Brown. "The course of action we have set for the newly acquired
entities (Adtranz and OMC) continue to reap benefits and our order
backlog remains strong at $45.9 billion. New order intake for the
first nine months of the fiscal year was also strong, both in
aerospace and transportation."
/T/
Bombardier Aerospace
* Q3 revenues reach $2.6 billion
* Aircraft deliveries total 69 units compared with 85 in same period
last year
* Income before special items and income taxes reaches $239.8 million
* Order backlog of $24.9 billion
* Inaugural flights for new Bombardier Continental* business jet and
for first production Bombardier CRJ900*
* Inauguration of new final assembly facility at Mirabel Airport
* Introduction of Bombardier Global 5000* super-large business jet
* Appointment of Pierre Beaudoin as new president and COO
For the three months ended Oct. 31, 2001, Bombardier Aerospace had
revenues of $2.6 billion, compared with $2.5 billion in the previous
year. Aerospace income before special items and income taxes for the
third quarter was $239.8 million, compared with $286.9 million before
special items and income taxes for the same quarter last year.
Aircraft deliveries totalled 69 units, compared with 85 in the third
quarter of the previous fiscal year. This number includes deliveries
of 24 business aircraft and of 45 regional aircraft.
In view of lower demand for new aircraft in the U.S., production
levels, and consequently staffing levels, had to be adjusted.
Production rate adjustments apply to most aircraft programs.
Production of the Bombardier Canadair 415* amphibious aircraft has
been suspended until such time as the orderbook warrants restarting
the assembly line. As a result of the overall outlook for
turboprops, a special charge of $264.0 million before taxes related
to the non-recurring costs of the Bombardier Q400* aircraft has been
taken during the quarter. The charge resulting from staffing
reductions for the quarter amounts to $32.1 million before taxes.
During the third quarter, the new Bombardier Continental business jet
successfully completed its first flight while the first production
Bombardier CRJ900 also took its inaugural flight.
On Oct. 22, the new final assembly facility at Montreal's Mirabel
Airport was inaugurated and on Oct. 25, Bombardier introduced the new
Bombardier Global 5000 super-large business jet.
On Oct. 17, Pierre Beaudoin was appointed president and chief
operating officer of Bombardier Aerospace. Mr. Beaudoin brings to
his new function an in-depth knowledge and first-hand experience of
the business of Bombardier. He was president of Bombardier
Recreational Products for five years, and more recently, president of
the Business Aircraft division.
Bombardier Transportation
* Results of Adtranz fully included for the third quarter
* Q3 revenues up 168% to $1.7 billion
* Income before income taxes and goodwill amortization up 347% to
$82.2 million
* New contract wins total $1.1 billion during the third quarter
* Order backlog of $21.0 billion
For the three months ended Oct. 31, 2001, Bombardier Transportation
had revenues of $1.7 billion, compared with $648.1 million in the
previous year. For the period, income before income taxes and
goodwill amortization was $82.2 million, compared with $18.4 million
for the same quarter the previous year.
For the quarter, the increase in revenues arises mainly from the
consolidation of the results of Adtranz with those of Bombardier
Transportation as well as a higher level of activity for the New York
subway and Virgin Rail contracts.
During the third quarter, Bombardier Transportation concluded
contracts for a total value of $1.1 billion in seven countries.
Included were orders to supply: 240 Electrostar cars, valued at $465
million, to Govia of the United Kingdom; 32 high-speed power heads,
valued at $197 million, to the Spanish National Railways RENFE; 19
people movers and all related electrical and mechanical systems,
valued at $150 million, for Barajas Airport in Madrid, Spain;
Automatic Train Protection Systems, valued at $125 million, for
Taiwan; 10 automated people movers and all related electrical and
mechanical systems, valued at $71 million, for Houston, USA;
refurbishment of 136 suburban passenger coaches, valued at $58
million, for Hungary; 10 freight locomotives, valued at $42 million,
for Switzerland; and 12 cars and 36 power bogies, valued at $21
million, for Luxembourg.
In September, Bombardier Transportation was selected for the supply
of 500 high-capacity regional trains for the French National Railways
(SNCF). The contract should be finalized by the end of 2001. Also
in September, the Metronet consortium, which comprises Bombardier
Transportation, was named preferred bidder for a second London
Underground Infraco contract.
Bombardier Transportation's $21.0 billion order backlog represents an
increase of more than 169% as at Oct. 31, 2001 mainly as a result of
the inclusion of Adtranz' orders.
The terms of the sale and purchase agreement (SPA) for the
acquisition of Adtranz from DaimlerChrysler provide for a purchase
price adjustment based on the carrying value of the net assets
acquired as at April 30, 2001. At this stage, the Corporation and
DaimlerChrysler disagree on the Net Asset Amount. In such a case,
the SPA provides a negotiation procedure and, if warranted, for an
arbitration process to establish the final purchase price.
Negotiations began at the end of October.
On Nov. 13, Bombardier Transportation announced plans for
implementation of its new European passenger-vehicle manufacturing
network strategy, which calls for concentrating capital intensive
activities into specialized plants. This will result in the closure
of three plants and the conversion of two manufacturing plants to
service facilities. The costs involved with the implementation of
this strategy are part of the previously announced special
restructuring charge of approximately $180 million to be recorded
after the third quarter or are part of the purchase equation of
Adtranz. No special costs related to this announcement have been
recorded in the third quarter ended Oct. 31, 2001.
Bombardier Recreational Products
* Q3 revenues of $550.0 million, up 14%
* Income before income taxes up 116% to $44.9 million
* Introduction of more environmentally-friendly four-stroke Sea-Doo*
watercraft and four-stroke Ski-Doo* snowmobile
* Entrance of new ATV segment with three junior ATVs
* Delivery of first Bombardier-built outboard engines
For the three months ended Oct. 31, 2001, Bombardier Recreational
Products had revenues of $550.0 million, up 14% from $480.8 million
in the previous year. Recreational products income for the latest
period, before income taxes, was $44.9 million, compared with $20.8
million in the third quarter last year. Increased revenues and
income are mainly attributable to the inclusion of the new outboard
engine activities.
During the third quarter, the first Bombardier-built outboard engines
have rolled off the production line at the new state-of-the-art
manufacturing plant located in Sturtevant, Wisconsin. Production of
Bombardier's Evinrude* and Johnson* outboard engines continues to
ramp up.
In September, Bombardier Recreational Products entered the Mini-ATV
market with the introduction of three smaller models intended for
younger riders.
A more environmentally-friendly Sea-Doo watercraft has been
introduced in August, featuring a high-performance four-stroke Rotax*
engine which is most efficient in terms of fuel consumption and air
emission control. In September, a prototype four-stroke engine
engineered exclusively for snowmobile use was also introduced.
Bombardier Capital
* Q3 revenues of $239.9 million
* Withdrawal from manufactured housing and consumer retail financing
sectors
For the three months ended Oct. 31, 2001, Bombardier Capital had
revenues of $239.9 million, compared with $263.3 million in the
previous year. Bombardier Capital's income before special items and
income taxes was $12.9 million, compared with income before income
taxes of $12.2 million for the same quarter last year.
On Sept. 26, Bombardier Capital announced it would exit from the
manufactured housing and the consumer retail financing businesses.
As a result of this decision and the slowdown of the US economy which
affected negatively the credit quality of portfolios related
to these businesses, Bombardier Capital recorded special items
totalling $662.5 million in the third quarter.
Assets under management as at Oct. 31, 2001, totalled $11.7 billion
compared with $14.1 billion as at July 31, 2001.
Financial highlights are as follows:
(Unaudited, millions of Canadian dollars, except per share amounts)
Three months Nine months
ended Oct. 31 ended Oct. 31
2001 2000 2001 2000
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Revenues
Aerospace $2,572.6 $2,549.8 $7,910.3 $6,706.3
Transportation 1,733.8 648.1 4,187.2 2,163.9
Recreational Products 550.0 480.8 1,338.8 1,126.1
BC 239.9 263.3 762.1 730.5
Intersegment eliminations (83.3) (85.7) (233.9) (180.4)
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External revenues $5,013.0 3,856.3 $13,964.5 10,546.4
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Income before
special items, income
taxes and goodwill
amortization
Aerospace $239.8 $286.9 $879.1 $774.3
Transportation 82.2 18.4 186.4 95.1
Recreational Products 44.9 20.8 92.5 42.0
BC 12.9 12.2 12.9 33.8
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379.8 338.3 1,170.9 945.2
Special items 958.6 -- 958.6 29.7
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Income (loss) before
income taxes and
goodwill amortization (578.8) 338.3 212.3 915.5
Income taxes (228.1) 112.4 23.4 288.1
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Income (loss) before
goodwill amortization (350.7) 225.9 188.9 627.4
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Goodwill amortization
net of taxes 16.9 -- 27.6 --
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Net income (loss) $(367.6) $225.9 $161.3 $627.4
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Earnings (loss) per
share, before
goodwill amortization
Basic $(0.26) $0.16 $0.13 $0.45
Fully diluted $(0.26) $0.16 $0.13 $0.44
Earnings (loss) per share:
Basic $(0.27) $0.16 $0.11 $0.45
Fully diluted $(0.27) $0.16 $0.11 $0.44
Average number of common
shares outstanding
during the period
(thousands) 1,369,323 1,364,369 1,368,000 1,370,068
Bombardier Inc., a diversified manufacturing and service company, is
a world leading manufacturer of business jets, regional aircraft,
rail transportation equipment and motorized recreational products.
It is also a provider of financial services and asset management.
The Corporation employs 79,000 people in 24 countries in the
Americas, Europe and Asia-Pacific and its revenues for its fiscal
year ended Jan. 31, 2001 totalled $16.1 billion Cdn.
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FORWARD LOOKING STATEMENTS
This press release includes "forward looking statements" that are
subject to risks and uncertainties. For information identifying
legislative or regulatory, economic, climatic, currency,
technological, competitive and other important factors that could
cause actual results to differ materially from those anticipated in
the forward looking statements, see Bombardier's Annual Report under
the heading Risks and Uncertainties in the Management's Discussion
and Analysis section.
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*Trademark of Bombardier Inc. or its subsidiaries
DETAILED CONSOLIDATED FINANCIAL STATEMENTS AND NOTES FOR THE THIRD
QUARTER AND THE NINE MONTHS ENDED OCT. 31, 2001 ARE AVAILABLE ON THE
CORPORATION'S WEBSITE AT www.bombardier.com UNDER THE "WHAT'S NEW"
SECTION |
