Embraer had a strong sales year in its executive jets division but a $71.6 fourth-quarter impairment charge in the unit and charges associated with the Boeing joint venture helped contribute to a company-wide net loss of $322.3 million in 2019, company executives reported Thursday. This comes despite a leap in revenues from $5.07 billion in 2018 to $5.46 billion last year. Embraer Executive Jets was a strong contributor to this jump, experiencing a 26.5 percent increase on the year.
The Brazilian manufacturer reached the top end of its 2019 guidance with 109 business jet deliveries and, importantly, CFO Antonio Carlos Garcia noted that the company delivered all aircraft produced, meaning it did not carry white tails into 2020. Embraer capped the year with an agreement from Flexjet for a mix of 64 Phenoms and Praetors that are valued at $1.4 billion based on list prices. Backlog for the Executive Jet unit climbed to $1.4 billion, up from $800 million a year ago.
While Embraer said it has not received cancellations nor has its supply chain been notably slowed from the effects of the Covid-19 travel restrictions, the company is holding off providing guidance for 2020 until it has a better sense on the full ramifications of the crisis. The company already halted production for a little more than a week in Brazil as it sent its employees home with pay through the end of the month and is evaluating other and future steps.
Further, it has had discussions, primarily with airline customers, about potential deferrals on deliveries into next year. But CEO Francisco Gomes Neto added that the business jets side has seen less of an impact and the company in fact not only secured sales this past week but also made a couple of deliveries.