Embraer hit by about 50% cut in revenues of its commercial jet business

23rd March 2021

By: Rebecca Campbell

Creamer Media Senior Deputy Editor

     

Font size: - +

Brazilian aerospace group Embraer, one of the world’s leading companies in the sector, has released its results for last year. Embraer’s financial year is identical to the calendar year. The financial results were released on a consolidated basis and according to International Financial Reporting Standards. The group has four business operations – commercial aviation, executive (business) jets, ‘services & support’ and ‘defence & security’. 

During 2020, commercial aviation accounted for 29.6% of Embraer’s total revenues (a very sharp drop in comparison to the 40.9% contribution during 2019). Executive jets provided 28.4% of group revenues last year, up from 25.6% in 2019, while the contribution of services & support was 24.4% (up from 22.8% in 2019). Defence & security recorded a significant increase in its contribution, to 17.3% in 2020 from 10.5% in 2019. 

In actual numbers, all these businesses except defence & security reported a drop in their revenues. Last year commercial aviation accrued revenues of almost $1.12-billion, in comparison to the nearly $2.24-billion achieved in 2019. Executive jets’ revenues in 2020 were just over $1.07-billion, as against the nearly $1.4-billion accrued the year before. Services & support brought in $0.92-billion last year, compared to almost $1.25-billion during 2019. Defence & security’s 2020 revenues were just over $0.65-billion, up from nearly $0.58-billion in 2019.

The group suffered an adjusted net loss of just over $0.46-billion last year, compared to an adjusted net loss of almost $0.22-billion during 2019. However, total debt at the end of last year (almost $4.45-billion) was just over $0.10-billion less than it had been at the end of 2019 (nearly $4.55-billion). Net debt at the end of 2020 came to almost $1.7-billion. At that same time, the group had total cash of $2.8-billion – the same figure as at the end of 2019. The group’s firm order backlog was worth $14.4-billion.

Last year the group delivered 44 commercial airliners. These comprised 32 E 175s, one E 190, four E 190-E2s and seven E 195-E2s. (The -E2s are new-generation variants of the original E-Jet airliner family.) The firm order backlog numbered 281 airliners, comprising 132 E 175s, three E190s, seven E 190-E2s and 139 E195-E2s. The backlog contained no E 170s or E 195s. (In 2019, the company delivered 89 commercial jets.)

Regarding executive jets, 2020 saw Embraer deliver 86 of these. The company operates in two segments of this market, large and light, and 30 of the deliveries were in the large category and 56 in the light category, of which 50 were Phenom 300 series aircraft. According to the General Aviation Manufacturers Association, 2020 was the ninth year in a row that the Phenom 300 was the world’s best-selling light business jet. (During 2019, the group delivered 109 executive jets, divided into 47 large and 62 light.)

Defence & security’s deliveries last year included six A-29 Super Tucano light attack and training aircraft to the Nigerian Air Force, two others to the Chilean Air Force, while yet two more, for an undisclosed customer, received ‘pre-acceptance’ at Embraer’s Gavião Peixoto plant. The group also delivered two upgraded E-99M airborne warning and control aircraft and two KC-390 multimission transport and tanker aircraft to the Brazilian Air Force. Defence & security also delivered a range of ground-based systems for the Brazilian Air Force and systems and services for the Brazilian Navy and Army. At the end of the year the Brazilian flight test programme for the latest generation Saab Gripen E fighter started. The Gripen E (and two-seat Gripen F) will re-equip the Brazilian Air Force’s fighter and fighter-bomber squadrons, with Embraer undertaking assembly of the majority of the aircraft being acquired, in Brazil. 

Because of the ongoing uncertainty caused by the continuing Covid-19 pandemic, the group decided not to publish any financial or delivery guidance for this year, yet. 

Edited by Creamer Media Reporter

Comments

The content you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION