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March 4, 2024


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Bombardier reported strong financial performance for 2023, which met or exceeded company guidance on strong deliveries despite supply chain headwinds. The company delivered 138 business jets in 2023, moving revenues to just over $8 billion for the year, up 16% over 2022.
Adjusted EBITDA was up 30% to $1.23 billion, and net income per share rose to $3.94 per share, five times 2022 results.

Reporting a book-to-bill of nearly 1 to 1 during 2023, the company is poised for growth in 2024 and 2025, expecting 150-155 deliveries in 2024. Nonetheless, the backlog fell slightly from $14.8B to $14.2B at the end of the year. Aftermarket revenues increased to $1.75B in 2023, capitalizing on expanding the company’s service and support network.

Since the refocus of the company on the business jet market, the company has responded well, including paying down debt and generating free cash flow despite supply chain issues requiring higher inventories and working capital. The company is on track to meet its 2024 and 2025 objectives, with expectations the 2024 growth will be in the Challenger product line with a stable Global market in 2024 and growing in 2025. The next two years at Bombardier are shaping up well, and management is guiding revenues of $8.5B for 2024 on the higher delivery volume.

The only area of concern from the financial performance is free cash flow, as higher working capital levels from increased inventories to pre-empt supply chain problems will be required to ensure smooth production and will likely level out in 2025.  This stems from changes in the mix due to supply chain constraints requiring higher inventories during the first half of the year to meet production requirements.  Continuing supply chain problems are manageable but require additional cash flow until shortfalls can be corrected, hopefully in 2025.

The Bottom Line

Despite a slight downturn in the business jet market, Bombardier is bullish on the future, buoyed by the success of the Challenger 3500 and Global 7500/8000 product families, and success of the Global 6500 in defense markets.  The mix and timing of the supply chain and production volumes of each model will impact free cash flow, with the Global family flat in 2024 with the smaller Challenger 3500 fueling the projected growth in deliveries.  The company expects growth in Global orders to grow in 2025.

The company has been paying down debt, and expects by 2025 to continue to reduce yet to move closer to its long-term debt ratio target.  Overall, the restructuring of Bombardier after the exit from commercial aircraft appears to be proceeding to plan, with the company profitable and improving its balance sheet.  Even with potential headwinds for the business jet market, the near-term outlook remains quite positive.

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President AirInsight Group LLC

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