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LATEST NEWS
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Friday, November 4th, 2022
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Bombardier has announced its financial results for the third quarter of 2022, marked by solid revenues, a significant improvement in adjusted EBITDA, continued positive free cash flow generation and a growing backlog that reflects strong order activity. In summary, the results show solid third quarter revenues of US$1.5 billion include a 20% year-over-year aftermarket increase to US$372 million; full-year deliveries on track for more than 120 aircraft.
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Adjusted EBITDA for the third quarter rose to US$210 million, a 48% year-over-year improvement. Adjusted EBITDA margin rose 460 bps year-over-year to 14.4%. Reported EBIT from continuing operations for the third quarter was US$145 million. Positive free cash flow generation of US$52 million from continuing operations for the third quarter of 2022, in line with raised cash flow guidance announced in August 2022.
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Reported cash flow from operating activities for the quarter was US$122 million and net additions to PP&E and intangible assets for the quarter were US$70 million. Backlog has grown by US$300 million to US$15 billion since the end of second quarter; the third quarter unit book-to-bill of 1.3 reflects strong order activity. Further successful debt reduction of US$100 million through cash on balance sheet brings year-to-date debt repayment to US$873 million; adjusted liquidity stands strong at approximately US$1.7 billion with cash and cash equivalents of US$1.3 billion as of September 30, 2022. Further strengthened the liquidity position through a five-year committed secured revolving credit facility of US$300 million subsequent to the quarter end.
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Sikorsky, a Lockheed Martin company and the Defense Advanced Research Projects Agency (DARPA) have, for the first time, successfully demonstrated to the U.S. Army how an uninhabited Black Hawk helicopter flying autonomously can safely and reliably perform internal and external cargo resupply missions and a rescue operation.
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Performed on October 12, 14 and 18, as part of the U.S. Army’s Project Convergence 2022 (PC22) experiment, the flights show how existing and future piloted utility helicopters could one day fly complex missions in reduced-crew or autonomous mode. This would give Army commanders and aviators greater flexibility in how and when aircraft and pilots are used, especially in limited-visibility or contested environments.
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Sikorsky is partnered with DARPA to develop autonomy technology that will exponentially improve the flight safety and efficiency of rotary and fixed-wing aircraft. Sikorsky’s autonomy system, known as MATRIX™ technology, forms the core of DARPA’s ALIAS (Aircrew Labor In-cockpit Automation System) project.
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“We believe MATRIX technology is ready now for transition to the Army as they look to modernise the enduring helicopter fleet and acquire Future Vertical Lift aircraft,” said Igor Cherepinsky, Director of Sikorsky Innovations. “In addition to increasing flight safety and reliability, MATRIX technology enables survivability in high-tempo, high-threat 21st century security environments where Black Hawk helicopters operate today, and DEFIANT X® and RAIDER X® helicopters could operate in the future. Un-crewed or reduced-crewed helicopters could safely perform critical and lifesaving missions day or night in complex terrain and in contested battlespace.”
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Chapman Freeborn, a global air charter specialist and part of Avia Solutions Group, has appointed David Tasker as Director – Government & Humanitarian.
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Tasker brings over 30 years of logistics experience to the role, including six years as Vice President Global Defence at DB Schenker and 13 years as Head of DSCOM, where he was responsible for all transport movements across Europe, as well as procurement and tender analysis for the MOD (Ministry of Defence).
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In his role of Global Director – Government & Humanitarian, Tasker will be developing governmental and humanitarian air opportunities on a global scale, ensuring this happens in a coordinated, centralised and transparent manner across the Chapman Freeborn Group.
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Spirit AeroSystems' (Spirit) revenue in the third quarter of 2022 was US$1.3 billion, up 30% from the same period of 2021. This increase was primarily due to higher production deliveries on the Boeing 737 programme as well as increased aftermarket revenue, partially offset by lower production deliveries on the Boeing 747 programme. Overall deliveries increased to 316 shipsets during the third quarter of 2022 compared to 248 shipsets in the same period of 2021. This includes Boeing 737 deliveries of 69 shipsets compared to 47 shipsets in the same period of the prior year.
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Spirit’s backlog at the end of the third quarter of 2022 was approximately US$36 billion, with work packages on all commercial platforms in the Airbus and Boeing backlog.
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Operating income for the third quarter of 2022 was US$4.5 million, compared to an operating loss of US$156.6 million in the same period of 2021. This increase in operating income was primarily driven by higher production on the Boeing 737 programme and lower forward loss charges, compared to the same period of the prior year.
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Third-quarter 2022 earnings included net forward loss charges of US$49.1 million and unfavourable cumulative catch-up adjustments of US$4.9 million. The forward losses relate primarily to the Airbus A350, Boeing 787 and RB3070 programmes. The Airbus A350 programme forward loss reflects additional costs related to labour, freight and rework and the impact of part shortages. The forward loss on the Boeing 787 programme was driven by increased supply chain and other costs. The RB3070 nacelle programme forward loss was driven by increased engineering cost estimates.
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Excess capacity costs recorded during the third quarter of 2022 were US$31.4 million. In comparison, during the third quarter of 2021, Spirit recorded US$70.4 million of net forward loss charges, unfavourable cumulative catch-up adjustments of US$2.8 million and excess capacity costs of US$57.1 million. The cash balance at the end of the third quarter of 2022 was US$671 million. (£1.00 = US$1.12 at time of publication)
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The Boeing 737 family continues to dominate the narrow-body P2F (passenger-to-freighter) conversion market, spearheaded by the B737-800, according to insights revealed by IBA, a leading aviation market intelligence and consultancy company.
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In the 2022 year to date, there have been 52 B737-800 conversions, with 63 in 2021 as a whole, whereas the total of five A321 conversions in 2021 has already been surpassed by nine conversions in the year to date.
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In the first edition of a new six-week webinar series entitled “Ask the Appraiser’, IBA’s experts provided an update on freighter values by aircraft type. The webinar revealed that:
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- The Boeing 737-800 P2F has a substantial fleet of 121 active aircraft, with 47 aircraft pending conversions and 33 in storage. Lease rates remain stable at around US$180,000 per month.
- The Boeing 757-200 P2F has a fleet of 235 active aircraft (184 Rolls-Royce powered and 51 Pratt & Whitney). Additionally, there are 24 aircraft pending conversion and 37 stored aircraft. Lease rates remain stable at around US$190,000 per month.
- Demand for the Airbus A321-200 P2F is coming from operators including Global Crossing Airlines, Express Freighters Australia, IndiGo, Lufthansa Cargo, SmartLynx Malta, Titan Airways. There are only ten active aircraft, but 43 pending conversion.
- There is currently high demand for the Airbus A330-300 P2F with conversion customers including Altavair Airfinance, ATSG, Avalon (IAI), CDB Aviation Lease Finance, DHL, MNG Airlines, Stratos Aircraft Management and ULS Airlines Cargo. There are 17 active aircraft with another 22 pending conversion.
- IBA considers the A330-200 P2F more of a niche type freighter, with five active aircraft and a further seven pending conversion.
IBA forecasts a potential overall softening of freighter values and leases, with rising capacity and softening demand creating pressure on cargo yields.
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AAR CORP., a provider of aviation services to commercial and government operators, MROs, and OEMs, celebrated the fruition of collaborative efforts to donate a functional aircraft to Rock Valley College’s Aviation Maintenance Programme on October 18, 2022.
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AAR partnered with the State of Illinois Department of Commerce and Economic Opportunity to provide funding, SkyWest Airlines to sell the aircraft and The Workforce Connection to manage the workforce development grant. AAR is grateful to all parties involved who helped deliver a functional CRJ-200 aircraft that will further aviation-focused education in Illinois.
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Leaders from education, industry and government gathered at Rock Valley College to mark the first donation of a CRJ-200 to a community college.
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AAR will work alongside Rock Valley College to ensure the CRJ-200 is fully implemented into the college’s aviation maintenance curriculum through a process that has been streamlined thanks to the new FAA part 147 regulation that went into effect on September 21.
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Atlas Air Worldwide Holdings has posted its third-quarter 2022 results with net income of US$60.1 million compared with net income of US$119.5 million in the third quarter of 2021.
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On an adjusted basis, EBITDA totalled US$194.0 million in the third quarter this year compared with US$280.5 million in the third quarter of 2021. Adjusted net income in the third quarter of 2022 totalled US$78.8 million compared with US$145.4 million in the third quarter of 2021.
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Revenue grew to US$1.1 billion in the third quarter of 2022 compared with US$1.0 billion in the prior-year quarter. Volumes in the third quarter of 2022 totalled 79,274 block hours compared with 90,363 in the third quarter of 2021.
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On August 4, 2022, Atlas Air Worldwide entered into a definitive agreement to be acquired by an investor group led by funds managed by affiliates of Apollo Global Management, together with investment affiliates of J.F. Lehman & Company and Hill City Capital.
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The Company continues to expect to complete this transaction in the fourth quarter of 2022 or the first quarter of 2023.
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