Bombardier offers upbeat sales forecast despite CSeries setbacks
By Solarina Ho
TORONTO (Reuters) - Bombardier Inc BBDb.TO, one of the world's leaders in making both planes and trains, provided an upbeat 2016 revenue forecast on Thursday despite its struggles to get its costly new Cseries jetliner into service.
Bombardier Chief Executive Pierre Beaudoin told investors in New York that it expects 2016 revenue to be between $23 billion and $25 billion, and that it could top $30 billion in as few as five years.
The Montreal-based company had 2013 revenue of $18.2 billion, and has already forecast 2014 revenue of about $20 billion. It expects revenue in 2015 will fall somewhere between that of 2014 and 2016.
RBC analyst Walter Spracklin said in a research note the 2016 forecast was ahead of his $22 billion estimate, and noted that new 2014 guidance of $1.5 billion in operating profit before interest, depreciation and amortization was also higher than his $1.3 billion forecast.
CSERIES STILL IN TESTING
The projections come after Bombardier, which unveiled its new CSeries jetliner a year ago to much fanfare and high expectations, began 2014 by pushing back the date of aircraft's entry into commercial service to the second half of 2015. It had originally expected the plane to be in service at the end of last year.
The multiple delays have been disappointing and costly setbacks in the company's ambitious plan to pit the CSeries, the product of a $4.4 billion development program, against the smaller jetliners made by industry giants Boeing Co BA.N and Airbus Group AIR.PA.
Bombardier's shares, which closed up 1.2 percent on Thursday at C$4.15, have languished far behind those of its competitors in the past two years, and are roughly at the same price they were in March 2012. Shares of Embraer SA EMBR3.SA, Boeing and Airbus, meanwhile, have all risen 40 percent or more. Continued...