Gulfstream Shipments Slip, but Sales Still 'Strong'

 - April 25, 2018, 11:15 AM
Despite Gulfstream delivering four fewer aircraft in the first quarter, shipments of super-midsize G280s and ultra-long-range G650/650ERs were relatively steady year-over-year. (Photo: Gulfstream Aerospace)

First-quarter deliveries at Gulfstream Aerospace fell 13.3 percent year-over-year, to 26 jets. Shipments of its super-midsize G280 held steady at seven in both first quarters, but large-cabin jets fell by four from a year ago, to 19, Phebe Novakovic, chairman and CEO of parent company General Dynamics, said this morning during an investor conference call.

The erosion on the higher end was in part due to G450 shipments ending and those of its replacement, the G500, not beginning until after the new airplane is certified in "June or July." A customer-initiated delivery delay of a special-mission G550 also worked against Gulfstream in the quarter.

While overall revenues and earnings rose slightly at General Dynamics in the quarter, they declined at its Aerospace division, which includes Gulfstream and Jet Aviation. First-quarter Aerospace revenues were $1.852 billion, down 12 percent from a year ago, while earnings slipped by 21.2 percent, to $346 million.

According to Novakovic, Gulfstream’s 0.8:1 book-to-bill ratio in the first three months is slightly higher than the 0.7:1 ratio the company has seen in the first quarters over the past few years. “Gulfstream’s sales are strong in both North America and Europe,” she noted, with U.S. sales boosted by replacement orders and tax reform. Aerospace backlog stood at $12.059 billion as of April 1, down from $12.466 billion at the end of 2017.