Embraer posts first-quarter 2020 net loss of US$292.0 million

Embraer delivered five commercial jets and nine executive jets (five light / four large) in the first quarter of 2020, and the company’s firm order backlog at the end of the quarter was US$ 15.9 billion.

EBIT and EBITDA as reported were US$-46.9 million and US$9.3 million, respectively, yielding EBIT margin of -7.4% and EBITDA margin of 1.5%. This compares to EBIT of US$-15.2 million (-1.8% EBIT margin) and EBITDA of US$30.9 million (3.8% EBITDA margin) in the first quarter of 2019.

The first-quarter results include special items due to the impacts of COVID-19: 1) US$22.2 million in negative fair value changes on the company’s stake in Republic Airways Holdings, and 2) US$33.4 million in bad debt provisions on accounts receivables, as the company adopted a more conservative approach in the context of the COVID-19 pandemic.

Adjusted EBIT and EBITDA were US$8.7 million and US$64.9 million, respectively, yielding adjusted EBIT margin of 1.4% and adjusted EBITDA margin of 10.2%;

Net loss attributable to Embraer shareholders and Loss per ADS were US$-292.0 million and US$-1.59, respectively. Adjusted net loss (excluding special items and deferred income tax and social contribution) for the first- quarter was US$-104.0 million, with Adjusted loss per ADS of US$-0.57. The adjusted net loss in the first-quarter of 2019 was US$-61.8 million, for an adjusted loss per ADS of US$-0.34 in the quarter.

Embraer reported free cash flow of US$-676.5 million, in line with free cash flow of US$-665.3 million reported in the first quarter of 2019, which is historically negative due to seasonal working capital consumption.

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