Bombardier profit dips as plane deliveries, orders fall

Thu Oct 31, 2013 10:44am EDT
 
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By Solarina Ho

TORONTO (Reuters) - Canadian plane and train maker Bombardier Inc BBDb.TO reported a 15 percent fall in net profit on Thursday, pressured by fewer aircraft orders and deliveries in the third quarter and contract issues in its train unit.

The results came in below expectations and sent shares falling 8 percent on the Toronto Stock Exchange.

"While the weaker aircraft deliveries were mostly anticipated, we are clearly disappointed by the margin performance in transportation," Cameron Doerksen, an analyst with National Bank Financial, said in a client note.

Montreal-based Bombardier did not provide any updates on its new CSeries plane, which was unveiled in March and took flight for the first time in September after months of delays.

The company hopes the aircraft family can catapult it into the low end of a market now dominated by Boeing Co BA.N and Airbus EAD.PA.

But firm orders for the CSeries are moderate so far at 177, as potential buyers wait for flight test results to validate the company's claims about the new jetliner's fuel efficiency and cost savings potential. There are currently 403 total orders and commitments with 15 customers and operators.

After the plane's inaugural flight, attention is now focused on test results and when the plane can go into commercial service - currently set for an ambitious 12 months from first flight.

Many analysts are skeptical the first customer can begin operating a CSeries plane by next September and Bombardier has said it will provide an update on the entry-into-service (EIS) date in the coming months.   Continued...