The enterprise jet maker has flagged early first-quarter income that might beat analysts’ estimates
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Bombardier on Monday contested a bondholder’s claims that its current gross sales of non-core belongings breach the phrases of sure notes, and stated it could search bondholders’ consent to amend phrases on eight bond points.
Bombardier has emerged as a pure play enterprise jet maker after divesting belongings together with the sale of its transportation enterprise to Alstom, which it accomplished in January, to pay down debt and enhance earnings.
The corporate stated it launched consent solicitations with respect to excellent senior notes or debentures, following the claims by the unnamed bondholder that the asset gross sales represent a breach of sure covenants beneath the indenture governing the 2034 notes.
Bombardier stated in an announcement these claims are with out benefit and it has not breached any covenant, including that after evaluating numerous choices it had decided requesting bondholders to amend the phrases of the bonds was essentially the most “expedient and environment friendly path” to keep up worth and defend itself and its stakeholders.
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If the amendments are authorized, Bombardier will make a consent fee of US$1.25 per $1,000 principal quantity for relevant collection of notes, and $1.25 per $1,000 principal of Canadian dollar-denominated 7.35 per cent debentures due 2026, the assertion stated.
Bombardier additionally flagged early first-quarter income that might beat analysts’ estimates, as rising vaccinations encourage rich travellers to return to flying.
Bombardier reviews earnings on Thursday.
The jet maker stated it expects first-quarter adjusted earnings earlier than curiosity, taxes, depreciation, and amortization (EBITDA) from persevering with operations of US$123 million, above analysts’ common estimate of US$89 million, in line with IBES knowledge from Refinitiv.
The corporate expects enterprise jet income to rise by 18 per cent to US$1.3 billion within the first quarter, from a 12 months in the past, beating Wall Avenue’s estimate of US$1.18 billion.
Bombardier inventory closed up 3.3 per cent.
Whereas deliveries are roughly the identical, Bombardier’s product composition is shifting towards its flagship International 7500 jets, a income driver.
Bombardier stated it stays on monitor to ship between 110-120 enterprise plane in 2021. The corporate’s full-year deliveries fell 20 per cent to 114 jets in 2020.
© Thomson Reuters 2021