Bombardier has reported its financial results for the second quarter of 2023, signalling continued progress on all business fundamentals and performance on track toward reaching 2023 full-year guidance.
“Bombardier delivered a very strong second quarter. Our team successfully navigated a highly dynamic business environment that saw sustained demand for new and pre-owned jets, as well as steady service growth, all while supply chain pressure persisted,” says Éric Martel, president and chief executive officer, Bombardier. “We continue to progress on our positive trajectory by delivering remarkable growth in profitability, propelled by a strong adjusted EBITDA increase and margin expansion, as well as a positive adjusted net income and earnings per share. Thanks to our team's tremendous work, we boosted our revenues this quarter by eight per cent year-over-year, driven in part by an exceptional 19 per cent year-over-year aftermarket revenue increase.”
Bombardier reported $1.7 billion in revenues, an eight per cent year-over-year increase, driven by strong deliveries and higher aftermarket revenues. With 29 deliveries, Bombardier delivered one more aircraft than the same quarter last year and has a solid line of sight to reach the overall 2023 guidance of greater than 138 deliveries. The company's aftermarket business continued its stellar performance in the second quarter 2023, generating $428 million in revenue, an impressive 19 per cent increase compared to the same quarter last year.
Backlog rose to $14.9 billion in the second quarter of 2023, an increase of $0.1 billion since the end of the previous quarter, supported by a 1.1x unit book-to-bill.
Total adjusted EBITDA for the quarter was $275 million, representing an adjusted EBITDA margin of 16.4 per cent and a significant 350 basis point margin expansion over the same quarter last year. Rising margins across all platforms, growth of aftermarket business and disciplined operations are driving these metrics forward. The adjusted EBIT totalled $190 million, up 84 per cent compared with the same period of 2022.
The company once more reported positive adjusted net income in second quarter 2023; it reached $80 million, compared to a loss of $38 million in the same quarter last year. Reported net income was $10 million. The adjusted EPS was positive as well, at $0.72.
The $222 million free cash flow usage in second quarter 2023 was in line with expectations. It includes the non-recurring payments of $104 million on residual value guarantees to the now divested commercial aviation business, CAPEX spending to support the completion of Bombardier's new Global Aircraft Manufacturing Centre at Toronto Pearson airport, set to open this year, and working capital build to support higher deliveries in the second half of the year.