Bombardier profit up, C-Series on track
(Reuters) - Bombardier Inc (BBDb.TO: Quote) reported a better-than-expected 31 percent rise in third-quarter profit on Thursday, helped by higher aircraft deliveries to customers, lifting its shares more than 4 percent.
The company, the world's third biggest commercial planemaker, said that economic uncertainty in the United States and Europe was still hurting demand for its commercial jets but it did not announce any new production cuts.
Demand for its larger-sized business jets, such as its Challenger and Global brands, remained strong although appetite for the smaller Learjets continued to be soft.
It also said its all-new C-Series commercial jetliner was on track to meet its promised entry into service date of 2013. There has been growing doubt in the market that the single-aisle 110- to 149-seater plane, Bombardier's biggest, will meet its launch date.
"The aerospace side was definitely better than my estimates... Maybe the market was fearing much worse and just the fact that it didn't turn out that way, we are getting a bit of a relief rally out of it," Canaccord-Genuity analyst David Tyerman said.
By mid-afternoon, Bombardier's stock was up 4.5 percent at C$3.95 on the Toronto Stock Exchange. The stock is down 21 percent this year partly on worries about flagging commercial aircraft sales.
Bombardier, which is also the world's largest trainmaker, again burned through more cash in the quarter than the market expected, although it forecast a turnaround to positive cashflow in the fourth quarter.
Free-cashflow usage more than tripled to $346 million in the three months, with some of the drain coming from the company's rail unit as inventories built up there due to delays caused by safety approval bottlenecks on several large contracts in Europe.
Train deliveries had, however, already restarted in France and Sweden and a resumption in Germany was imminent, Bombardier Chief Executive Pierre Beaudoin said on a conference call. Continued...