MONTREAL Canada's Bombardier Inc on Thursday reported better-than-expected quarterly profit and higher revenue despite supply chain pressures, helped by demand for flying and maintaining private planes.
The Montreal-headquartered business jet maker reported a second-quarter profit of $10 million from continuing operations, compared with a loss of $109 million a year earlier.
Results of corporate jet makers have been powered by sustained demand from the wealthy for private flying over the last few quarters, but companies are wrestling with supply chain challenges that have made it harder to deliver planes.
CEO Eric Martel told analysts that despite "pressure points" such as smaller suppliers, the supply chain is improving and will "remain a key area of focus for the foreseeable quarters."
Last month, Cessna business jet maker Textron Inc raised its full-year adjusted earnings per share forecast on strong jet pricing.
Bombardier's aftermarket revenue, which comes from servicing planes, grew 19% on an annual basis, helping profitability.
However, there are early signs that demand may be flattening. Bombardier said on Thursday backlog at the end of June was up just 0.7% from the end of March at $14.9 billion.
On a per share basis, quarterly adjusted profit was 72 cents, compared with a loss of 48 cents a year earlier. Analysts polled by Refinitiv had expected profit of 28 cents per share.
Revenue rose 8% to $1.68 billion, in line with expectations.
Bombardier reported a cash burn of $222 million compared with free cash flow of $341 million a year ago, due to capital expenditures and a build-up in working capital to support higher jet deliveries in the second half of 2023.
The group said it remains on track to deliver at least 138 jets this year and hit its 2025 targets, which include turning over 150 jets to customers.
(This story has been corrected to show Textron is the maker of Cessna, not Gulfstream business jets, in paragraph 5)
(Reporting By Allison Lampert in Montreal and Abhijith Ganapavaram in Bengaluru; Editing by Saumyadeb Chakrabarty and Jan Harvey)
