Bombardier (TSX: T.BBD.B, Stock Forum) announced further layoffs Thursday in its aerospace division, as the Montreal-based company reported its fourth quarter and year-end results.
The company says business aircraft demand deteriorated rapidly during the second half of 2008 and is expected to remain weak for the foreseeable future. Bombardier Aerospace now says it expects to deliver 25% less business aircraft this fiscal year compared to fiscal year 2009, while still expecting to increase deliveries of its commercial aircraft by 10%.
As a result, the company has announced a reduction of approximately 10% of Bombardier Aerospace's total workforce, or approximately 3,000 employees, at its facilities in Canada, the United States, Mexico and Northern Ireland by the end of calendar year 2009, adding to the 1,360 layoffs announced last month.
In terms of results, the company reports that consolidated revenue for the year reached $19.7 billion, up 13% from $17.5 billion last fiscal year, while Bombardier recorded net income of $1 billion, compared to $317 million last year, with diluted earnings per share of 56 cents, compared to 16 cents for last fiscal year.
At Bombardier Aerospace, revenue increased to $10 billion compared to $9.7 billion last fiscal year, while Bombardier Transportation's revenue totalled $9.8 billion, an increase of 25% over last fiscal year.
The company reported consolidated revenue of $5.4 billion for the fourth quarter, compared to $5.3 billion for the same period last year. Net income amounted to $309 million, or diluted 17 cents per share, for the fourth quarter of fiscal 2009, compared to $218 million, or diluted 12 cents per share, for the same period the previous year.
"During the past year, we more than held our own as the world's financial markets tumbled and the global economy weakened. In fact, we reached a milestone with net income rising to $1 billion, for the first time in our history and our EPS more than doubled to reach $0.56 from $0.16 last fiscal year," said Pierre Beaudoin, president and CEO of Bombardier.
"There is no doubt that we are going through challenging times and our business environment is changing fast. There's a need for prudent execution, clear priorities and decisive action in the current context. However, we believe we are well positioned to face this difficult economic environment with a strong balance sheet, high level of liquidity as well as a large and diversified backlog, both by product and geographies," added Beaudoin.
The company also announced Thursday that Bombardier Transportation has signed an order with Lloyds TSB and London Eastern Railways, a subsidiary of National Express, for 30 four-car Bombardier Electrostar Electrical Multiple Unit trains plus a three year maintenance agreement, in a deal worth US$249 million.
Shares of Bombardier climbed 6.9% to $3.25 Thursday.
On the company’s Bullboard, members were leaving their thoughts on the results, including habsfanone, who said: “I am no economics expert nor an accountant but these earnings / revenues look very positive[sic].”
Junior40 replied: “They do look good but it's the past. In this market what's important is the guidance. The news headlines this morning is the 10% cut in jobs not that they beated the street in EPS. Business jet market looks very bleak[sic].”
And, Capharnaum added: “Regardless of everything else, just the transportation business of Bombardier is worth at least $3/share. If what was important was really looking ahead, then the share price should be higher, as long term Bombardier should see great results when the business jets market picks-up and compensate for the lost time[sic].”