Global transportation leader Bombardier Inc. today said it is disappointed with Moody’s decision to downgrade the Corporation’s debt ratings, even though the decision should have no significant impact on its operations.
“While we take Moody’s announcement very seriously, we still believe we have the right plan in place to achieve our objectives, and with $4.9 billion of liquidity at the end of October, we have the resources to address the situation,” said Paul M. Tellier, President and Chief Executive Officer. “We have renewed and increased our bank facilities, confirming the Company’s continued access to credit capacity.”
Bombardier continues to work diligently to improve its profitability and cash generation. It has already taken measures to proactively manage risks. Aerospace has dealt with its aircraft delivery schedule and production rates to mitigate the negative impact of some regional aircraft customers’ challenges. New orders from Air Canada, Air Nostrum and Air New Zealand, as well as an agreement with GECAS to take delivery of 16 aircraft from US Airways’ backlog will also counterbalance this effect.
Bombardier expects to deliver a similar number of aircraft this year as last year. A stronger business jet market will help meet the challenges in the regional aircraft business.
Bombardier’s transportation group returned to profitability in the second quarter and is expected to continue to be profitable. Footprint rationalization, production improvement initiatives and procurement process improvements have been put in place.
Bombardier Capital will continue to be active in inventory financing and to generate profits while the wind-down of portfolios moves forward as planned.
“We remain a market leader in both aerospace and rail transportation equipment with complete lines of products that are innovative, are on the cutting edge and address our customers’ needs,” Tellier continued.
“We have good liquidity and the restructuring program is on track. We are focused on our plan and we will attain our objectives, which now include a return to investment grade,” concluded Tellier.
A world-leading manufacturer of innovative transportation solutions, from regional aircraft and business jets to rail transportation equipment, Bombardier Inc. is a global corporation headquartered in Canada. Its revenues for the fiscal year ended Jan. 31, 2004 were $15.5 billion US and its shares are traded on the Toronto, Brussels and Frankfurt stock exchanges (BBD, BOM and BBDd.F). News and information are available at www.bombardier.com.
Vice President, Communications