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Bombardier Inc. T.BBD.A

Alternate Symbol(s):  BDRPF | T.BBD.PR.B | BDRXF | T.BBD.PR.C | T.BBD.PR.D | BOMBF | BDRAF | T.BBD.B | BDRBF

Bombardier Inc. is a Canada-based manufacturer of business aircraft with a global network of service centers. The Company is focused on designing, manufacturing and servicing business jets. The Company has a worldwide fleet of more than 5,000 aircraft in service with a variety of multinational corporations, charter and fractional ownership providers, governments and private individuals. It operates aerostructure, assembly and completion facilities in Canada, the United States and Mexico. Its robust customer support network services the Learjet, Challenger and Global families of aircraft, and includes facilities in strategic locations in the United States and Canada, as well as in the United Kingdom, Germany, France, Switzerland, Austria, the United Arab Emirates, Singapore, China and Australia. The Company's jets include Challenger 350, Challenger 3500, Challenger 650, Global 5500, Global 6500, Global 7500 and Global 8000.


TSX:BBD.A - Post by User

Comment by lb1temporaryon Feb 11, 2022 10:20am
186 Views
Post# 34420005

RE:2021 +FCF

RE:2021 +FCF''It's because they are not going to use any more money from their reserves, to prop up this company again in the future. What I mean is that, this year they used some reserves to get a positive FCF, but next year they will catch up''

Just a little explanation.

The FCF formula  used by Bombardier is described (BBD presentation Page 12) this way: cash flow from operations less net additions to PP&E and intangible assets.

That's nothing to do with reserves utilisation.

More, In the Conference call Martel explain the ''apparent'' weak FCF forecasted for 2022 ( 50M$ only after a 100 M$ performance in 2021). The construction of an business aircraft takes an average of 9 months. So, given the 20% production increase sceduled for 2023, an inventory ramp-up has to be done.  So, the work in progress at dec 31 2022 will be much more important than last year. As you know larger inventories means more funds used by operations and less FCF.

In addition, as already noted, the weak deliveries since the beginning of the year means that the work in progress at dec 31 2021 were very low helping to get the 325 M$ FCF for Q4 and the 100 M$ for the year. 

This explanation is given 
without prejudice to BBD859,  we appreciate all the analysis but the discussion has to be open.
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