Canadian plane and train maker Bombardier Inc reported lower-than-expected revenue, hurt by weak demand in its rail and business aircraft units.
The company said revenue in the business aircraft division, which makes the Learjet, Global and Challenger business jets, fell 20.9 per cent to US$1.65 billion in the fourth quarter.
Bombardier delivered 163 business jets in 2016, down 36 from a year earlier.
Revenue in the transportation business – the train-making division – fell 10 per cent to US$1.95 billion in the quarter. The company’s order intake in the business fell 3.4 per cent to US$8.5 billion in 2016.
Bombardier, which has struggled in recent years with cost overruns in its CSeries commercial jet program, said it delivered 86 commercial aircraft in 2016, compared with 76 in 2015.
Chief executive Alain Bellemare has been stepping up efforts to reshape the manufacturer after shares fell to a 26-year low in 2016. He announced about 14,500 jobs last year to overcome cost overruns and a delay of more than two years on the US$6 billion program to develop the C Series jetliner — a competitor to single-aisle planes from Boeing Co. and Airbus Group SE.
“As we begin 2017, we are confident in our strategy, our turnaround plan and in our ability to unleash the full value of the Bombardier portfolio,” Bellemare said in the statement.
The Canadian government agreed last week to provide aid for Bombardier’s CSeries jet and the Global 7000 business jet programs.
Net loss attributable to Bombardier shareholders narrowed to US$251 million, or 12 cents per share, in the fourth quarter ended Dec. 31, from US$679 million, or 31 cents per share, a year earlier. Excluding items, the company lost 7 cents per share.
Bombardier took charges of US$30 million in the latest quarter compared with US$673 million in the prior-year quarter.
Montreal-headquartered Bombardier, which is in the middle of a five-year turnaround plan to improve results, reported a 12.7 per cent fall in revenue to US$4.38 billion.
Analysts on average had estimated a 3 cent loss on revenue of US$4.64 billion, according to Thomson Reuters I/B/E/S.
The Montreal-based company reaffirmed its forecast that revenue will increase by a low-single-digit percentage in 2017, following two years of declines.
With files from Bloomberg
© Thomson Reuters 2017