Embraer SA (ERJ) Q3 2024 Earnings Call Highlights: Strong Revenue Growth Amid Supply Chain ...

GuruFocus.com11-13

Revenue: Increased more than 32% year-over-year in Q3 2024. Adjusted EBIT Margin: Increased to 9.5% for the year; Q3 margin at 17.6% including Boeing agreement, 8.7% excluding it. Free Cash Flow: ...

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Q3 margin at 17.6% including Boeing agreement, 8.7% excluding it.\nFree Cash Flow: ...</p>\n\n<a href=\"https://finance.yahoo.com/news/embraer-sa-erj-q3-2024-010045580.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"ERJ","symbol_name":"巴西航空工业","start_time":0,"source_url":"https://finance.yahoo.com/news/embraer-sa-erj-q3-2024-010045580.html","article_id":"2483409973","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/mlL0eFZZadrG58dvCpNQ0g--~B/aD0xNjE7dz0yNTA7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/us.finance.gurufocus/55ba1d948c141761d821b6c329d08528"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2483409973","pubTimestamp":1731459645,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Revenue: Increased more than 32% year-over-year in Q3 2024.Adjusted EBIT Margin: Increased to 9.5% for the year; Q3 margin at 17.6% including Boeing agreement, 8.7% excluding it.Free Cash Flow: Projected at $300 million or higher for 2024.Firm Order Backlog: Reached $22.7 billion in Q3 2024.Aircraft Deliveries: 57 aircraft delivered in Q3 2024, 33% higher year-on-year.Service & Support Revenue: Grew 16% year-on-year in Q3 2024.Adjusted EBITDA Margin: 21.1% in Q3 2024, including Boeing agreement.Adjusted Net Income: $221 million for Q3 2024, 13.1% margin.Net Debt-to-EBITDA Ratio: Declined to 1.3x in Q3 2024.2024 Revenue Guidance: $6 billion to $6.4 billion.2024 Commercial Aviation Delivery Guidance: Adjusted to 70-73 aircraft.GuruFocus has detected 3 Warning Sign with ERJ.For the complete transcript of the earnings call, please refer to the full earnings call transcript.Embraer SA  increased its adjusted EBIT margin guidance to 9.5% and free cash flow generation to $300 million or highe","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"ERJ":"巴西航空工业"},"translate_title":"巴西航空工业公司(ERJ)2024年第三季度收益看涨期权亮点：供应链中收入强劲增长……","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ERJ":1},"content_text":"Revenue: Increased more than 32% year-over-year in Q3 2024.\nAdjusted EBIT Margin: Increased to 9.5% for the year; Q3 margin at 17.6% including Boeing agreement, 8.7% excluding it.\nFree Cash Flow: Projected at $300 million or higher for 2024.\nFirm Order Backlog: Reached $22.7 billion in Q3 2024.\nAircraft Deliveries: 57 aircraft delivered in Q3 2024, 33% higher year-on-year.\nExecutive Aviation Revenue: Increased 65% year-on-year in Q3 2024.\nDefense & Security Revenue: Increased 65% year-on-year in Q3 2024.\nService & Support Revenue: Grew 16% year-on-year in Q3 2024.\nAdjusted EBITDA Margin: 21.1% in Q3 2024, including Boeing agreement.\nAdjusted Net Income: $221 million for Q3 2024, 13.1% margin.\nNet Debt-to-EBITDA Ratio: Declined to 1.3x in Q3 2024.\n2024 Revenue Guidance: $6 billion to $6.4 billion.\n2024 Commercial Aviation Delivery Guidance: Adjusted to 70-73 aircraft.\n\n\nWarning! GuruFocus has detected 3 Warning Sign with ERJ.\n\nRelease Date: November 08, 2024\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.\n Positive Points \n\nEmbraer SA (NYSE:ERJ) increased its adjusted EBIT margin guidance to 9.5% and free cash flow generation to $300 million or higher for 2024.\nRevenues increased by more than 32% year-over-year in Q3, driven by strong performance in Executive Aviation and Defense & Security, both up more than 65%.\nThe firm order backlog reached $22.7 billion in Q3, supported by a robust book-to-bill ratio higher than 2:1.\nFitch Ratings upgraded Embraer's rating from BB+ to BBB- with a stable outlook, marking investment grade status by two out of three leading US rating agencies.\nExecutive Aviation achieved its best third quarter in terms of revenues and deliveries, with a 65% year-on-year revenue increase in Q3.\n\n Negative Points \n\nCommercial Aviation guidance was reduced from 72-80 jets to 70-73 aircraft due to supply chain problems.\nThe adjusted EBIT margin for Commercial Aviation declined to minus 5% in Q3 due to supply chain delays and unfavorable product and customer mix.\nSupply chain challenges persist, particularly with engines and structural components, affecting delivery schedules.\nDespite improvements, the adjusted EBIT margin for Defense & Security declined from 15.6% in Q3 '23 to 7.2% in Q3 '24.\nThe company faces significant supply chain delays, mainly in the E2 assembly line, impacting production and delivery timelines.\n\n Q & A Highlights \nQ: Regarding the commercial aircraft guidance, is the revision due to worsening supply chain issues or just a course adjustment? Are there other factors like mix or operational issues affecting this? A: Francisco Gomes Neto, President and CEO: The delay is solely due to supply chain issues, particularly with engines and structural parts. There are no other factors like mix or labor affecting this.\nQ: Can you provide insights on the weaker margins in Commercial Aviation and the sustainability of strong margins in Executive Aviation? A: Antonio Carlos Garcia, CFO: The weaker margins in Commercial Aviation are due to a mix of more E2s instead of E1s and an unfavorable customer mix. We expect margins to improve in Q4. For Executive Aviation, while Q3 margins were strong, we anticipate lower-teens margins in Q4 and beyond.\nQ: Could you elaborate on the recent defense orders from the Czech Republic and their financial implications? A: Antonio Carlos Garcia, CFO: The contract includes both defense and service components, contributing to our cash flow guidance. We expect strong down payments, which could further improve our free cash flow.\nQ: With the high level of in-house Aerostructure work, do you see opportunities to increase this through M&A or other means? A: Antonio Carlos Garcia, CFO: We are highly verticalized in Aerostructure. While we conduct make-or-buy analyses, we do not see M&A as a current alternative. In-sourcing additional parts is possible, but not a primary focus.\nQ: How do you plan to allocate new product investments given the current financial performance across divisions? A: Francisco Gomes Neto, CEO: We benefit from having diverse business units. While Executive Aviation is performing well, Commercial Aviation faces challenges. We see potential in E2s with new customers and expect Commercial Aviation to improve, supported by strong Services & Support contributions.\nQ: Can you provide more details on the supply chain issues, particularly with engines and structural components? A: Francisco Gomes Neto, CEO: We face delays in receiving engines and structural parts, impacting aircraft assembly and delivery. While output is improving, timing remains an issue. We are enhancing planning to mitigate surprises and expect continued improvement next year.\nQ: How do you view the competitive environment given supply chain issues? Are you gaining new orders or better pricing opportunities? A: Francisco Gomes Neto, CEO: We are optimistic about new orders and are essentially sold out until 2026. We are actively pursuing campaigns for over 200 aircraft and expect to fill production slots through the decade.\nQ: What is the total investment needed for Eve up to certification and delivery start? A: Antonio Carlos Garcia, CFO: The total investment needed is around $600 million, and we have sufficient cash to run the company for the next three years.\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.This article first appeared on \nGuruFocus.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.2","shortVersion":"4.29.2","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2483409973"}