Business Jet OEM Issue First Quarter 2014 Results
The world’s leading business jet manufacturers posted financial results for the first quarter of 2014 in the weeks leading up to this year’s EBACE show. Overall, the latest numbers are somewhat encouraging in the context of the industry’s slow recovery but there are significant variations in the details. Here AIN provides a summary of the main conclusions.
Bombardier Aerospace: Bizjet Deliveries Up, Backlog Grows
Bombardier Aerospace’s first-quarter revenues declined year-over-year by 8.6 percent, to $2.1 billion, the Canadian aircraft manufacturer reported earlier this month. Bombardier executives attributed the lower quarterly revenue in part to the sale of its Flexjet fractional ownership business last year and lower sales of pre-owned aircraft. Meanwhile, its order backlog for both commercial and business aircraft grew to a record $38.5 billion, 40 percent of which is for aircraft under development.
The company delivered 43 business jets in the quarter, compared with 39 during the first quarter last year. This comprises 17 Global 5000/6000s, 14 Challenger 300s, six Challenger 605s and six Learjets. The business aircraft division received net orders for 46 aircraft after cancellations for nine, compared with net orders for 27 last year, for a corresponding book-to-bill ratio of 1.1:1.
Dassault Falcon: Deliveries Up, but Revenues Down
Dassault delivered nine Falcons in the first quarter, one more than it did in the same period a year ago, the company announced late last month. Still, revenues at Dassault Falcon fell year-over-year by €14 million ($19.35 million), to €397 million ($548.6 million), which equates to 68 percent of net revenues at parent Dassault Aviation.
During the quarter, Dassault booked orders for 12 Falcons, compared with 14 Falcons in the year-ago period. It logged €537 million ($742.1 million) in sales during the first quarter, versus €656 million ($906.6 million) in the same time frame last year.
Embraer: Phenom 300 Delivery Surge Driving Growth
Embraer’s revenues in the first quarter rose by $157 million, to $1.242 billion, while profits climbed from $30 million in the first quarter of 2013 to $110.6 million in the same period this year, thanks to a 66.7-percent increase in business jet deliveries and higher defense sales. At its Executive Jets division, first-quarter revenue soared to $267.4 million, up from $175.3 million a year ago.
Embraer delivered 20 executive jets (17 light and three large) in the quarter, compared with 12 (eight light, four large) in the same period last year. Meanwhile, its firm-order backlog for airliners and business jets grew to $19.2 billion, its highest since the second quarter of 2009.
Gulfstream Aerospace: Large-cabin Jets Soar
General Dynamics’s aerospace division, which includes Gulfstream Aerospace and Jet Aviation, saw first-quarter revenues climb 19.5 percent year-over-year, to $2.125 billion, while profits soared 30.3 percent, to $404 million, from the same period last year. Aerospace backlog ended the quarter at $14.946 billion, down from $15.622 billion at the end of last year, meaning the book-to-bill ratio was less than 1:1. “Given that the Gulfstream G650 has a four-year backlog, it’s hard to achieve a 1:1 book-to-build ratio,” General Dynamics chairman and CEO Phebe Novakovic said during a quarterly investor conference call late last month. She noted that 60 percent of the order intake during the quarter was for the G450 and G550.
Gulfstream delivered 39 completed aircraft during the first quarter, including 33 large-cabin and six midsize jets; this is a 34.5-percent increase from a year ago, when the company shipped 29 completed jets (25 large-cabin and four midsize). Novakovic said demand for new Gulfstreams “remains strong” and noted that pricing is “holding up nicely.”
Textron Aviation: Cessna and Beechcraft Rising
First-quarter revenues at Textron Aviation, which includes Cessna and Beechcraft, were up $77 million, to $785 million, thanks to the mid-March acquisition of Beechcraft, higher jet deliveries and higher aftermarket sales but offset by fewer pre-owned sales and falling revenue at CitationAir. The division recorded a profit of $14 million in the quarter versus a loss of $8 million a year ago, helped by firmer pricing and higher jet volumes.
Textron Aviation delivered 35 Cessna Citations during the quarter, up from 32 jets in the same period last year, and eight King Airs during the last two weeks of March when Beechcraft was officially under the Textron wing. (A total of 22 King Airs were delivered in the first quarter, compared with 34 a year ago.) Backlog at Textron Aviation as of March 29 was $1.5 billion, up from $1 billion at the end of last year, attributable to the addition of Beechcraft’s $534 million backlog.