RE:RE:RE:RE:RE:RBC: Surprised by the market reaction859, I did a fairly thorough for me (an amaateur) analysis of Bombardier's balance sheet and my conclusion is they generated $300MM of cash in 2023, it just didn't go to LTD. So its probably not unreasonable that this would increase to $400M and $500M in 2024 and 2025 respectively.
My calculation for the $300MM is as follows:
opreating current assets (cash inventory receiv pay current contract liability) + 67
RVR +100M (reduced)
LTD +373M (reduced)
Long term contract liability + 235 (reduced)
Other long term liabilties (lease, govt funding, vendor funding) + 25M (reduced)
= 800M
less funding from cash generated from other financial assets 500M
= $300M
Other notes
- the negative cashflow in Q1 (Q2? Q3?) will be from the significant increase in payables and inventory. comment: with more military and aftermarket business, can't push that stuff to Q4...
- ignored deferred tax (acct calc), retirement (actuarial calc), tooling & PPE (captured in EBITDA)
- the total of all other assets financial or otherwise is now $999M (excl back to back between govt, airbus and bombardier) of which almost half is what I call quasi cash - whether or when that can be released to actual cash remains to be seen.
- the other liabilities and provisions totals $1,441M excl. provisions and aforementioned back to back. of this, $807M is long term in nature (govt refundable advance $161M, lease $448M and vendor funding $198M). so the other liabilities financial or otherwise is $634M. Reasonable.
In my opinion, ability to reduce long term debt will depend (in no particular order) on 1) generating operating cashflow - looks good on that front 2) maintaining orders and backlog ie long term contract liabiilties - unknown 3) cash being released from other financial assets - unknown 4) capex discipline - PPE&E and tooling actually went down in 2023 although of note, all Pearson expansion in 2023 was paid out of their own pocket it seems - should be fine 5) other (asset sales, settlement with HBS, etc) - unknown. LESS 6) balance sheet growth (ie higher inventory) - unknown.
To your point, 2, 3, 5 and 6 will impact how much and when they can pay back some LTD.