Embraer updates 2024 guidance, forecasting fewer commercial jets but higher financial metrics, driven by a strong Q3 performance with record revenues and order backlog.
Embraer announced results for the Third Quarter of 2024.
Highlights:
- 2024 Guidance updated: Management believes prior guidance no longer represents evenly balanced opportunities and risks for full-year operations. From an operations point of view, the company estimate Commercial Aviation deliveries between 70 and 73 aircraft (down from 72 and 80), and Executive Aviation deliveries between 125 and 135 (unchanged). From a finance point of view, we forecast Revenues in the US$6.0-6.4 billion range (unchanged), Adjusted EBIT margin between 9.0% and 10.0% (up from 6.5% and 7.5%), and Adjusted Free Cash Flow of US$300 million or higher (up from US$220 million or higher).
- Fitch Ratings upgraded our credit rating from “BB+” to “BBB-” with a stable outlook in late September. Consequently, both S&P and Fitch currently rate the company Investment Grade (IG). Moody’s rating remains Ba1 (i.e. one-notch below IG) but it recently revised the company’s outlook to positive.
- Embraer delivered 59 jets in 3Q24 of which 41 were executive jets (22 light and 19 medium), 16 were commercial jets and 2 multi-mission C-390 Millennium in Defense & Security; +26% versus the 47 aircraft delivered quarter over quarter (qoq) and +37% versus the 43 aircraft delivered year over year (yoy).
- Firm order backlog of US$22.7 billion in 3Q24 – a new record, at a 9-year high level, more than 25% higher yoy and almost 10% higher qoq.
- Revenues totaled US$1,692 million in the period; +32% yoy. Highlight for Executive Aviation and Defense & Security revenues +65% yoy growth each.
- Adjusted EBIT reached US$297.5 million with a 17.6% margin in 3Q24 (US$147.5 million and 8.7% ex-Boeing arbitration; US$100.1 million and 7.8% in 3Q23).
- Adjusted free cash flow w/o Eve was US$241.1 million during the quarter because of higher number of aircraft delivered.
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