Agenda
- Industry trends and Bombardier's (TSE: BBD.A) strategic repositioning
- Growth opportunities and synergies as a pure-play business aviation company
- Supply and demand dynamics, including financial analysis
- Recovery path and 2021 outlook
Questions
1.
Could you give an overview of the aerospace industry’s performance in 2020, highlighting any key secular trends that we should continue to monitor in 2021?
2.
What is your outlook for the business aviation industry? How would you identify the significant demand shifts?
3.
You mentioned fuel efficiency as one of the new technology-related aircraft programmes that OEMs are continuing to invest in. What do you expect to drive demand over the next few years? What do you think customers have the largest appetite for?
4.
How would you evaluate Bombardier’s strategic repositioning as a pure-play business aviation company? What are its core strengths and weaknesses?
5.
How confident are you that Bombardier can successfully close Alstom’s acquisition of its rail transportation business by the end of January, given it has secured the necessary regulatory approvals? Do you expect any headwinds there?
6.
Do you anticipate any major internal restructuring challenges after the transaction is officially closed?
7.
What internal synergies might you expect for Bombardier as a pure-play business aviation company? How can it maintain growth while focusing on business jets and the ongoing transactions we’ve discussed?
8.
You alluded to Bombardier’s competitors. How do you expect Bombardier to compare with its main competitors such as Gulfstream, Textron or Dassault as it establishes itself as a pure-play company? What would you highlight as its competitive differentiators?
9.
You mentioned Bombardier’s global edge vs competitors and highlighted its advantage in China as an example, while its 2021 acquisition of the issued and outstanding shares of the Berlin aircraft service centre suggests a push towards global expansion. To what extent do you think Bombardier can guard its global exposure to customers and how might expansion affect its competitive edge?
10.
What is your M&A outlook for Bombardier, considering the Berlin aircraft service centre acquisition and the company’s major restructuring? Do you think Bombardier will focus on inorganic growth after its reintegration and organisation, assuming its transactions close smoothly? How important do you think that focus will be?
11.
Do you think Bombardier will be a potential acquisition target, once the rail transaction has successfully closed and given it’s now a pure-play company?
12.
Can you break down your demand outlook for Bombardier’s core business jet offerings?
13.
What is your outlook for the success of the Global 7500? How sustainable is President and CEO Éric Martel’s prediction of around 35 jets per year over the next few years?
14.
Could you expand on the Challenger 350 business jets you mentioned? Bombardier just announced an order of 10 350s, but it hasn’t invested in upgrading it for some time. What is your outlook for the 350s’ continued growth?
15.
What might be the impact of surplus in the pre-owned market, particularly for pre-owned business jets? What effects might that surplus have on Bombardier’s pricing strategy?
16.
Bombardier noted the need to recapitalise and to increase R&D investment in its most recent earnings, but that is being offset by its focus on debt reduction. What do you think would most likely be retired or in need of recapitalisation across Bombardier’s portfolio?
17.
How confident are you in Bombardier’s ability to continue to repay its debt over the next few years, considering the transactional cost, reorganisation and the need for R&D?
18.
Would you expect Bombardier to maintain margins and reduce cash burn to meet all of its requirements?
19.
How confident are you in Bombardier’s ability to realise its goal to increase deliveries by 50% from Q3 to Q4 2020? What QoQ increase might you expect as the COVID-19 vaccine is rolled out?
20.
How confident are you in Bombardier’s ability to achieve its targeted break-even cash flow, considering the impact of new aircraft sales on its free cash flow? Do you expect any major headwinds to achieving this in 2021, besides the restructuring?
21.
What should we monitor around Bombardier or the business jet aviation market in 2021?
