BOMBARDIER has released the full 2020 annual results for its Transportation division, which it has since sold to Alstom under a $US 6bn deal, which closed on January 29. 

Revenue for the year was $US 7.4bn, down 5.1% from $US 8.2bn in 2019. This included $US 4.77bn in revenue from rolling stock and systems, down from $US 5.19bn; $US 2bn from services, down from $US 2.1bn; and $US 1bn from signalling, up from $US 937m. Bombardier Transportation generated $US 4.8bn in revenue in Europe, $US 1.6bn in North America, $US 982m in the Asia Pacific region, and $US 343m in the rest of the world.

The decrease in revenue was due to:

• revised estimates on certain contracts in Germany, Switzerland and Britain that negatively affect revenues of rolling stock in Europe in the current year
• the negative impact on activities in rolling stock in North America and Europe due to the Covid-19 pandemic and related site closures in the first half of 2020, which was offset by higher activities in these regions in the fourth quarter, and
• lower activities in services, mainly in North America and Europe.

However, the overall decrease was partially offset by higher activities in signalling in North America, Asia-Pacific and Europe.

This resulted in an adjusted Ebit loss of $US 610m, down from a profit of $US 70m in 2019. Ebit including special items was a loss of $US 618m, down from a profit of $US 22m the previous year .

The order backlog as of December 31 2020 was $US 36.6bn, up from $US 35.8bn the previous year.  

The total proceeds from the sale to Alstom, after the deduction of debt-like items and transferred liabilities, was $US 6bn. This included €400m and €350m paid by Alstom to Bombardier and CDPQ to redeem the capital injections they had provided for the Transportation division in 2020.

After deducting CDPQ’s equity position of $US 2.5bn and other costs, Bombardier expects to receive $US 3.6bn in proceeds from the sale which it will use to pay down debt.  

Bombardier says the proceeds from the transaction were lower than previous estimates as a result of the Transportation division’s lower than expected cash generation in the fourth quarter due in part to unfavourable market conditions, as well as disagreements between the parties as to certain closing adjustments, which Bombardier intends to challenge.  

Orders

Order volumes were down in all regions Bombardier operates in across the world.  

Order volume in Europe was driven by several contracts awarded across Western Europe for commuter, regional and inter-city trains, primarily in Germany, France and Italy, along with significant LRV and metro orders in Britain and Germany, respectively.  

Orders in Eastern Europe were mainly driven by investments in both urban and mainline products, with major contracts for regional trains in the Czech Republic and Hungary as well as metro trains in Turkey and Greece.  

Rolling stock order volumes in North America was primarily driven by tenders awarded for metro trains in Canada and regional trains in the US. Order volume was also driven by significant signalling contracts, mainly for urban signalling modernisation and service agreements granted mainly for infrastructure maintenance and fleet management in both the US and Canada.

Market volume in the Asia Pacific region was mainly driven by large orders awarded for metro trains in China, the Philippines, India and Singapore as well as for regional and inter-city trains in Myanmar and South Korea. An order for very high-speed trains was also issued in China. 

In the signalling and services segments, several medium sized orders were placed in the region with the most significant contracts secured in India and Taiwan for signalling solutions and in China and Australia for maintenance and fleet management services agreements. 

In the rest of the world, order volume was driven mainly by investments in urban mobility solutions with large contracts awarded for metro train cars along with signalling and services agreements in Ivory Coast, Panama and Columbia. Significant contracts were also granted for LRVs in Russia and Morocco. 

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