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(Reuters) - Bombardier reported quarterly results on Thursday that beat expectations thanks to its rail division, sending shares surging, and said a favourable decision by a U.S. trade agency gave it flexibility to deliver CSeries jets to Delta Air Lines this year.
The International Trade Commission on Wednesday said it rejected hefty U.S. duties on the CSeries jets partly because Boeing Co lost no sales or revenue when Delta ordered the aircraft in 2016 from the Canadian plane-and-trainmaker.
During a call with analysts, Bombardier Chief Executive Alain Bellemare called the ITC's reasoning "good news" and said "it gives us the flexibility to ship the aircraft out of Mirabel (Quebec) to Delta" in 2018.
Bombardier said it expects revenue to grow to $17.0 billion to $17.5 billion in 2018. It is also targeting revenue of more than $20 billion by 2020.
Shares surged around 9 percent in morning trading.
The plane-and-train-maker is in the middle of a five-year turnaround plan to cut costs and boost margins, after years of heavy investments in two new aircraft programs pushed it to the brink of bankruptcy in 2015.
Bellemare said momentum was increasing for the company's business jets and it was prepared to increase production volume if the market supports it.
Revenue at its transportation unit, which includes rail, surged 28 percent to $2.49 billion during the quarter.
The company reported $304 million in earnings before interest, taxation, depreciation and amortisation (EBITDA) for the fourth quarter, compared with $203 million a year earlier.
Revenue grew 8 percent to $4.72 billion and EBITDA margin before special items rose to 6.4 percent from 4.6 percent.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)