Low Cost & Regional

Embraer delivers 10 commercial aircraft in the third quarter 

photo_camera TUI aircraft in flight (File photo)

Brazilian aircraft manufacturer Embraer delivered 33 aircraft during the third quarter 2022, including 10 commercial aircraft and 23 executive jets.

For the full year so far, the airframer delivered 23 commercial and 52 executive jets, and currently has a firm order backlog of $17.8 billion.

In September, Embraer celebrated the delivery of their 1,700th E-jet, and E195-E2 acquired by Aircastle and delivered to KLM Cityhopper. Since launching in 2004, E-jets have been added to the fleets of over 150 airlines and lessors in 50 countries.

In October, Oman-based SalamAir and TUI announced the selection of the Embraer E195-E2 for their fleets. SalamAir signed a firm order for six aircraft, with purchase rights for six more, with deliveries from the end of 2023. TUI will receive three Embraer E195-E2s on long-term lease from AerCap.

Embraer has logged over 1,900 orders for their E-Jets and the company has already delivered over 1,600 of the jets to 80 customers in 50 countries. Since the company’s founding in 1969, Embraer has delivered over 8,000 aircraft.

In Full: Embraer earnings results 3rd Quarter 2022

Embraer delivered 10 commercial jets and 23 executive jets (15 light / 8 mid/super-midsize jets) in 3Q22, bringing YTD deliveries to 27 commercial jets and 52 executive jets (33 light /19 mid/super-midsize jets). Although deliveries have been back ended to 4Q22 due to supply chain challenges in 2022, they are close to historical average for the quarter.

Reported 3Q22 consolidated gross margin of 19.1% compared to 19.0% reported in 3Q21. As a reference, 9M22 consolidated gross margin of 20.9% higher than 16.0% reported in same period of 2021.

Adjusted EBIT and EBITDA were US$50 million and US$93 million, respectively, yielding Adj. EBIT margin of 5.4% and Adj. EBITDA margin of 10.0%. Free cash flow (FCF) in 3Q22 was negative US$109.4 million, mainly explained by working capital increase due to higher deliveries in 4Q22 which will reverse to a positive trend.

The company finished the quarter with net debt of US$1.275 billion, or US$0.53 billion less than 3Q21 in line with the strategy to reduce interest expenses.

A revolving credit facility of up to US$650 million with 14 financial institutions was signed to increase liquidity and improve capital structure, following Embraer liability management strategy, or reducing gross debt and interest expenses.

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