Bombardier Mulls Investments, M&A to Boost Jet Output and Growth

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Or sign-in if you have an account.(Bloomberg) — Canadian business jet maker Bombardier Inc. wants to expand its manufacturing and maintenance capabilities as demand surpasses expectations, and acquisitions may be part of the strategy.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an Account“We have a very strong organic growth profile that will require us to spend some money, particularly to support production growth that is coming and we’ve already started to invest in,” Chief Financial Officer Bart Demosky told analysts Thursday. Bombardier announced in January that it would build a new manufacturing center near Montreal to boost production, mainly for its smaller Challenger models.Chief Executive Officer Eric Martel said the company is looking for a site in Canada to make defense-related modifications to jets it already makes, potentially boosting their economic value. Currently, for the GlobalEye surveillance aircraft, Bombardier delivers Global 6500 private jets to Saab AB, which modifies the aircraft and implements the military systems.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againThe North Atlantic Treaty Organization is in formal negotiations with Saab for as many as 10 GlobalEye jets, sidelining a competing Boeing Co. product. Martel said it’s possible for Bombardier “to do things that we don’t do today on our plane, and have more penetration into the maintenance market. And maybe the best way for us to get there could be by acquisition.”Bombardier reported adjusted diluted earnings per share of $2.50 for the second quarter, handily beating the $1.36 estimated by analysts in a Bloomberg survey. It also said it’s on track to meet its 2026 financial guidance.The company, which had been burdened with heavy debt for years, had $1.9 billion in available liquidity in the period. Its ratio of adjusted net debt to adjusted earnings before interest, taxes, depreciation and amortization was 1.6, nearing its 1.5 target. Shares fell 1.4% in Toronto to C$353.35 as of 10:29 a.m.“Bombardier appears positioned for similar strong profit in 2026, though margins may plateau, as guidance for over 157 aircraft deliveries appears conservative despite improving supply chains,” Bloomberg Intelligence analyst George Ferguson wrote in a note. “Snags impacted deliveries at the start of the year, but the issue seems to be resolved.”The manufacturer’s order backlog was $21.8 billion, up 25% from a year ago. Vista Global Holding Ltd. ordered 40 Challenger 3500 aircraft in February, and KKR & Co.-backed private jet company Bond expanded in April its commitment for a new Bombardier fleet of more than 120 aircraft to $5 billion from $4 billion. The Helicopter Company, backed by Saudi Arabia’s sovereign wealth fund, said last week it would expand into the private jet industry with a commitment for as many as 60 Bombardier aircraft.Martel stated that the Challenger and Global models were flying 7% and 8% more hours, respectively, than last year. “People are flying more and more private,” he said.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.