Canadian planemaker Bombardier reported $6.9 billion in revenue in 2022

Bombardier has just released details of its fourth quarter and full-year 2022 financial results as well as detailing its expectations for 2023.  

The Canadian company reported $6.9 billion in revenues, an increase of 14% year-over-year following higher deliveries and a favourable aircraft mix and also a significant contribution from aftermarket services, which grew 22% year-over-year to reach $1.5 billion in 2022.

Bombardier reported an adjusted EBITDA of $930 million, a 45% increase year-over-year and well over the guidance of greater than $825 million. The growing contribution of the Global 7500, cost structure improvements, higher aftermarket contribution and a better aircraft mix were among the key factors in this substantial increase. The company also beat guidance on the full-year reported EBIT, which was at $538 million.

The company made the most of the strong demand and competitive product portfolio and avoided pitfalls related to the pressures on the supply chain to deliver 123 aircraft, 49 of which were delivered in the fourth quarter of 2022. 

Éric Martel, Bombardier’s President and Chief Executive Officer said:  "The 2022 results - are a resoundingly positive culmination of a strong year, and a testament to the team’s effort to execute in the fourth quarter. We exceeded commitments across the board, be it on deliveries, our growing aftermarket business and profitability. We are also proud of the fantastic job our team did on deleveraging, with $1.1 billion dollars of debt retired in 2022 thanks to cash from our balance sheet and operations. This puts us ahead of our plan and gives us the flexibility to be even more proactive and opportunistic going forward."

2023 Outlook.....

Bombardier's outlook for 2023 indicates revenues are expected to be greater than $7.6 billion, driven mainly by an increase in deliveries, which are expected to be greater than 138 units. The continued and steady growth of aftermarket services, which the company continued to ramp up in 2022 through a significant expansion of the service centre network and recruitment of skilled technicians, is also to be an important driver in 2023.

The company expects to continue outpacing revenue growth as it expands its margins. An increase in adjusted EBITDA to greater than $1,125 million is expected, representing a 21% increase versus 2022, driven by margin conversion of the incremental revenues, positive tailwinds from the Global 7500 pricing and the near completion of the company’s cost reduction plan. Adjusted EBIT(2) is expected to grow to greater than $695 million, an increase of 36% year-over-year.

Bombardier also expects continued positive free cash flow generation, which is expected to be greater than $250 million​ in 2023, including one-time payments related to residual value guarantees estimated at approximately $125 million, and net additions to PP&E and intangible assets around $350 million.

Bombardier also announced this month a change in the leadership team to focus on moving the firm forward executing long-term growth and optimization strategies in the key areas of defence, services, continuous product improvement and next-generation manufacturing practices.

Éric Martel said: "Bombardier has successfully embarked on its journey as a company focused on its world-class business jet portfolio. As we continue to meet or exceed targets, it is the right time to thoughtfully reshape key leadership functions to ensure the solid foundation we have set fully carries our momentum well into the future. - Our leadership team members are talented and have delivered on commitments time and again these past years, and this new alignment will further build upon the foundations they have successfully set for Bombardier."

As part of the leadership structure evolution, the following alignments and appointments will take effect on February 20, and all other existing Bombardier leadership team members will continue in their roles:

Jean-Christophe Gallagher is appointed Executive Vice President, Aircraft Sales & Bombardier Defense. Gallagher will lead all aspects of Bombardier’s growing defence business as its product offering and customer base expand. Gallagher will also oversee the talented Sales team led by Peter Likoray, Senior Vice President, New Aircraft Sales. Under Peter’s leadership, Bombardier has grown its backlog and built local roots across the world. Peter will continue to deepen his and his team’s passion for crafting unique experiences for Bombardier customers as they match their discerning needs to the company’s exceptional portfolio.

Paul Sislian is appointed Executive Vice President, Bombardier Aftermarket Services & Strategy. Having spent 15 years optimizing and leading Bombardier’s business jet manufacturing facilities and processes, Sislian will now carry forward and accelerate the division’s strategic growth journey that saw Bombardier inaugurate four newly built or expanded maintenance facilities around the world in 2022.

All aerostructures, assembly and completions activities will be led by David Murray, who will add these responsibilities to his current mandates and is appointed to the role of Executive Vice President, Manufacturing, IT and Bombardier Operational Excellence System (BOE). The alignment of these three functions will enable a new focus on availing teams of next-generation digital technologies to further enhance Bombardier core processes.

Éric Filion is appointed to the new role of Executive Vice President, Programs and Supply Chain. In this capacity, Filion will oversee all Bombardier supplier relationships and lead continuous, competitive improvement efforts for all in-production Bombardier aircraft. Filion previously held operations and program leadership positions at Bombardier, including oversight of the Challenger aircraft production facility. Most recently he served as Executive Vice President, Chief Operating and Customer Experience Officer for Hydro-Québec. Filion will join Bombardier on February 20, 2023.

Finally, Michel Ouellette will lead Engineering and Product Development as the group’s Executive Vice President. After a 33-year career at Bombardier that culminated in the successful certification of the Global 7500 jet and subsequent launch of the performance-leading Global 8000 flagship aircraft, Ouellette is set to retire at the end of June 2023.

“Michel’s contributions to Bombardier can certainly be enumerated at great length, and their positive and lasting impact on our people, our products and our company is simply immeasurable,” said Martel. “On behalf of everyone at Bombardier whose lives Michel has touched, I want to sincerely thank him for his leadership and passion—and wish him all the best in his next chapter. I also look forward to continuing collaborating in the months ahead, as we press forward with exciting projects.”