ATW Daily News

Embraer posts breakeven results in 'rough' sales environment

Monday November 2, 2009

Embraer reported third-quarter net income of $60.6 million, slightly ahead of the $59.3 million earned in the year-ago period, and warned that 2010 likely will be another difficult year for sales.

CFO Luiz Carlos Aguiar told analysts Friday that the manufacturer is "going through a rough ride in terms of new sales" and cautioned that "a decline of 10% in our revenue" in 2010 is possible. He added that its firm order backlog, which stood at 306 commercial aircraft valued at $18.6 billion at the end of the third quarter, would "make the business sustainable" until sales rebound.

Commercial aviation sales continued to struggle in the quarter, dropping 16.6% year-over-year to $824.1 million. The company said it was able to achieve breakeven results for the three months ended Sept. 30 through "a stronger control of expenses and productivity gains." Overall third-quarter revenue sank 19.4% to $1.55 billion.

Embraer delivered 29 commercial aircraft in the period, down 21.6% from 37 delivered in the year-ago quarter. Deliveries comprised one ERJ-145, four E-170s, three E-175s, 17 E-190s and four E-195s. It projected that it will deliver 115 commercial aircraft for full-year 2009.

by Aaron Karp

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