Montreal – Bombardier Inc. expects its revenue to grow to between US$17 billion and US$17.5 billion in 2018 – higher than 2017, but below analyst estimates.
The Montreal-based company, which keeps its books in U.S. dollars, said the forecast was about $1 billion higher than its guidance for this year.
However, the average analyst estimate had been for $18.4 billion in revenue for 2018, according the Thomson Reuters.
“As we approach the half-way point of our five-year turnaround plan, we continue to meet our commitments and build a strong foundation for generating sustainable profit growth,” Bombardier’s CEO Alain Bellemare said in a statement.
“We remain very much on track to achieve our 2017 guidance, our 2018 free cash flow goal, and see a clear path to deliver on our 2020 objectives.”
The company’s shares were unchanged at C$3.13 on the Toronto Stock Exchange after 30 minutes of trading.
Bombardier said the growth in revenue is expected to be driven by the ramp-up of key projects at Bombardier Transportation and higher C Series aircraft deliveries.
The company announced a deal in October that will see Airbus acquire a 50.01 stake in the C Series program, with Bombardier owning 31 per cent and Quebec’s investment agency with 19 per cent.
Bombardier said it expects to deconsolidate the results of the C Series program following the close of the agreement.
The company said it’s objective is to grow revenue by US$4.0 billion over three years, which represents a seven per cent compound annual growth rate.
It estimated revenue from its commercial aircraft business would fall to $1.5 billion in 2020, from $2.7 billion in 2018, assuming the C Series is deconsolidated from Bombardier’s books. The revenue from commercial aircraft would rise to an estimated $5 billion if the C Series continued to be included in the company’s consolidated statements.
Bombardier estimated its business aircraft division will be its biggest source of revenue growth, rising by $3.5 billion between next year and 2020 when it’s expected to generate more than $8.5 billion of revenue.
The transportation division, which sells commuter rail equipment, will have $9 billion of revenue in 2018, rising to $10 billion in 2020 and the aerostructures and engineering services division will have an estimated $2 billion of revenue in 2018, rising above $2.25 billion in 2020.