The recession is not currently expected to have a "significant impact" on Bombardier Transportation because "for the rail industry, the fundamentals remain strong."
Bombardier Inc. issued that statement Wednesday as it reported that its rail equipment division posted earnings before income taxes of $125 million, or $5.6% of revenue totaling $2.3 billion, for the fiscal quarter ended April 30. This compared with EBIT of $118 million, or 4.8% of revenue, for the corresponding period a year ago.
Bombardier Transportation's order backlog at the end of the quarter was $25 billion, compared with $24.7 billion on April 30, 2008. The division reported new orders of $1.2 billion in the quarter, for a book-to-bill ratio of 0.5. Since the end of the quarter, BombardierTransportation has booked orders totaling another $1.2 billion.
Corporate performance was hurt by cancellations of orders for business aircraft at Bombardier Aerospace, which outpaced the level of new orders.
Consolidated revenue reached $4.5 billion in the fiscal quarter, compared with $4.8 billion in he 2008 period EBIT was $235 million, down from $312 million.
As for the future, President and CEO Pierre Beaudoin commented: "We are taking action to cope with the present economic situation as we continue to invest in new products such as the C Series, the Learjet 85,the ZEFIRO high speed trains, and the EC4 suite of technologies, At $47.4 billion, our large and well diversified backlog, combined with our strong balance sheet, high level of liquidity, and the cost cutting measures already in place, will enable us to weather the storm."