Bombardier profit, sales fall on gap in train contracts
By Susan Taylor
(Reuters) - Canadian plane and train maker Bombardier Inc (BBDb.TO: Quote) said the timing of major train contracts hurt revenue and profit in the second quarter as big projects wrapped up in Asia and Europe, while new orders were still in start-up phase.
Shares of the Montreal-based company, whose quarterly revenue lagged analysts' expectations, dropped as much as 4 percent before rebounding modestly.
"The market will be slightly disappointed with these results, especially at (train unit) BT," National Bank Financial analyst Cameron Doerksen said, who described Bombardier's new C-Series plane as the most important driver for the share price.
"We are not overly concerned, however, as the strong (train) backlog will support higher revenue and margins in the coming years."
Bombardier, the world's third-biggest plane maker, said it continues to plan for a first flight of its new C-Series jetliner in December, but would consider itself on schedule if that occurred within three to five months of its target.
"I'll repeat what I've always said for the last three years, we target the flight at the end of year. This can play three to five months and I would consider that on time. But the focus of our team is to fly at the end of the year," Chief Executive Pierre Beaudoin said on a conference call.
WATCH THE TIMING
Investors and analysts are scrutinizing the timetable because of chronic development delays in the aircraft industry. Continued...