Family-controlled transportation and aerospace company Bombardier announced on 5 April that it has received an order for six business jets valued at a total of $255 million, just days after reporting a decline in its 2010 revenues.
The company, which is controlled by the Bombardier-Beaudoin family, said in a statement that an undisclosed customer has placed an order for three of its Challenger jets and three Global jets. The group said that the deal is important as it reaffirms the appeal of the company’s business aircraft portfolio, which had seen a slump during the financial crisis.
The transaction, valued at $255 million, is a boost to the Montreal, Canada-based group, which saw its revenues for 2010 fall to $17.7 billion from $19.4 billion the year before.
On 31 March, Bombardier, headed by third-generation chief executive and president Pierre Beaudoin, reported that while its revenues saw a fall, its net profits rose to $769 million in 2010 from $707 million in 2009. It attributed the increase in profits to a low effective tax rate, and said that the fall in income was due to decreased activity in the aircrafts and locomotive sector.
Beaudoin said in a statement: “Our efforts to lean out our cost structure combined with our continued focus on operational excellence have enabled us to increase our profitability despite the year’s reduction in revenues.”
Both the aerospace and transportation business saw a drop in revenue for the year, but witnessed growth in the fourth quarter ending 31 January due to new jet orders.
Founded in 1942 by Joseph-Armand Bombardier, the family holds 54% of the voting rights at the aerospace and trains company, and its shares are traded on the Toronto Stock Exchange. Pierre Beaudoin was appointed president and chief executive in 2008, succeeding his father Laurent who remains chairman of the group.
The world’s third-biggest planemaker is often held up as a model of good succession planning for the smooth transition it executed between generations. Pierre joined the group in 1985 and was appointed president and COO of Bombardier Aerospace in 2001. In 2004 he was named executive vice president and made a member of the board. Following this, in November 2007 he was named the future president and succeeded his father in mid-2008, who stepped down after 42 years at the company helm.