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Embraer (ERJ) Q1 Loss Wider Than Estimates, Revenues Fall Y/Y
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Shares of Embraer S.A. (ERJ - Free Report) have declined 5.8% following its first-quarter 2022 results, reflecting investors’ disappointment about the outcome.
Embraer reported a first-quarter 2022 adjusted loss of 43 cents per American Depository Share (ADS), wider than the Zacks Consensus Estimate of a loss of 26 cents per ADS. However, the loss contracted from the year-ago quarter’s loss of 52 cents per ADS.
Total Revenues
Embraer’s first-quarter revenues were $600.9 million, down 26% year over year.
EmbraerEmpresa Brasileira de Aeronautica Price, Consensus and EPS Surprise
Embraer delivered 14 jets in the reported quarter. ERJ delivered six commercial and eight executive (six light and two midsize) jets compared with 16 commercial and 39 executive (26 light and 13 midsize) jets in the prior quarter.
The backlog at the end of the first quarter was $17.3 billion compared with $17 billion in the prior quarter, driven by solid order activity.
Operational Highlight
Embraer’s adjusted EBIT was a loss of $27 million in the first quarter of 2022, which contracted from the loss of $29.6 million reported in the first quarter of 2021.
The company posted quarterly adjusted EBITDA of $13.2 million, declining 26.7% from the year-earlier quarter.
Financial Update
As of Mar 31, 2022, ERJ’s cash and cash equivalents amounted to $1.13 billion compared with $1.82 billion as of Dec 31, 2021.
The company had net debt of $1,453.2 million as of Mar 31, 2022, up from $1,392.2 million as of Dec 31, 2021.
Its adjusted free cash outflow during the first quarter was $67.8 million, improving massively from the free cash outflow of $226.6 million in the year-ago period. The improvement came primarily due to working capital optimization measures and enterprise efficiency.
Guidance
Embraer reaffirmed its guidance for 2022. Its Commercial jet deliveries are projected in the band of 60-70 jets, while the Executive Aviation deliveries are expected in the band of 100-110 aircraft.
The company expects to generate revenues in the range of $4.5 billion-$5 billion in 2022. The Zacks Consensus Estimate for sales, pegged at $4.86 billion, lies above the midpoint of the guidance range.
Embraer anticipates the adjusted EBIT margin in the range of 3.5%-4.5% and the adjusted EBITDA margin in the band of 8%-9% in 2022. It anticipates free cash flow without mergers and acquisitions or divestitures of $50 million or more.
Zacks Rank
Embraer currently has a Zacks Rank #5 (Strong Sell).
Lockheed Martin (LMT - Free Report) reported first-quarter 2022 earnings of $6.44 per share, which surpassed the Zacks Consensus Estimate of $6.22 by 3.5%. However, the bottom line declined by 1.8% year over year.
Lockheed Martin ended the first quarter of 2022 (on Mar 27, 2022) with $134.23 billion in the backlog compared with $135.36 billion at the end of the fourth quarter of 2021. LMT’s cash from operations at the end of the first quarter of 2022 amounted to $1.41 billion compared with $1.75 billion a year ago.
General Dynamics Corporation (GD - Free Report) reported first-quarter 2022 earnings per share of $2.61, which beat the Zacks Consensus Estimate of $2.49 by 4.8%. Its first-quarter revenues of $9,392 million surpassed the Zacks Consensus Estimate of $8,977.3 million by 4.6%.
General Dynamics recorded a total backlog of $87.23 billion, down 0.4% from the 2021-end backlog. The funded backlog at the first-quarter end was $66.60 billion. In the first quarter of 2022, GD generated cash from the operating activities of $1,968 million, escalating sharply from the only $3 million generated in the year-ago period.
The Boeing Company (BA - Free Report) incurred an adjusted loss of $2.75 per share in the first quarter of 2022, wider than the Zacks Consensus Estimate of a loss of 26 cents. In the quarter under review, Boeing’s revenues amounted to $13.99 billion, which missed the Zacks Consensus Estimate of $16.01 billion by 12.6%.
The backlog at the end of the first quarter of 2022 decreased to $370.84 billion from $377.50 billion at the end of 2021. BA’s operating cash outflow as of Mar 31, 2022 was $3.22 billion.
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Embraer (ERJ) Q1 Loss Wider Than Estimates, Revenues Fall Y/Y
Shares of Embraer S.A. (ERJ - Free Report) have declined 5.8% following its first-quarter 2022 results, reflecting investors’ disappointment about the outcome.
Embraer reported a first-quarter 2022 adjusted loss of 43 cents per American Depository Share (ADS), wider than the Zacks Consensus Estimate of a loss of 26 cents per ADS. However, the loss contracted from the year-ago quarter’s loss of 52 cents per ADS.
Total Revenues
Embraer’s first-quarter revenues were $600.9 million, down 26% year over year.
EmbraerEmpresa Brasileira de Aeronautica Price, Consensus and EPS Surprise
EmbraerEmpresa Brasileira de Aeronautica price-consensus-eps-surprise-chart | EmbraerEmpresa Brasileira de Aeronautica Quote
Order & Delivery
Embraer delivered 14 jets in the reported quarter. ERJ delivered six commercial and eight executive (six light and two midsize) jets compared with 16 commercial and 39 executive (26 light and 13 midsize) jets in the prior quarter.
The backlog at the end of the first quarter was $17.3 billion compared with $17 billion in the prior quarter, driven by solid order activity.
Operational Highlight
Embraer’s adjusted EBIT was a loss of $27 million in the first quarter of 2022, which contracted from the loss of $29.6 million reported in the first quarter of 2021.
The company posted quarterly adjusted EBITDA of $13.2 million, declining 26.7% from the year-earlier quarter.
Financial Update
As of Mar 31, 2022, ERJ’s cash and cash equivalents amounted to $1.13 billion compared with $1.82 billion as of Dec 31, 2021.
The company had net debt of $1,453.2 million as of Mar 31, 2022, up from $1,392.2 million as of Dec 31, 2021.
Its adjusted free cash outflow during the first quarter was $67.8 million, improving massively from the free cash outflow of $226.6 million in the year-ago period. The improvement came primarily due to working capital optimization measures and enterprise efficiency.
Guidance
Embraer reaffirmed its guidance for 2022. Its Commercial jet deliveries are projected in the band of 60-70 jets, while the Executive Aviation deliveries are expected in the band of 100-110 aircraft.
The company expects to generate revenues in the range of $4.5 billion-$5 billion in 2022. The Zacks Consensus Estimate for sales, pegged at $4.86 billion, lies above the midpoint of the guidance range.
Embraer anticipates the adjusted EBIT margin in the range of 3.5%-4.5% and the adjusted EBITDA margin in the band of 8%-9% in 2022. It anticipates free cash flow without mergers and acquisitions or divestitures of $50 million or more.
Zacks Rank
Embraer currently has a Zacks Rank #5 (Strong Sell).
You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Releases
Lockheed Martin (LMT - Free Report) reported first-quarter 2022 earnings of $6.44 per share, which surpassed the Zacks Consensus Estimate of $6.22 by 3.5%. However, the bottom line declined by 1.8% year over year.
Lockheed Martin ended the first quarter of 2022 (on Mar 27, 2022) with $134.23 billion in the backlog compared with $135.36 billion at the end of the fourth quarter of 2021. LMT’s cash from operations at the end of the first quarter of 2022 amounted to $1.41 billion compared with $1.75 billion a year ago.
General Dynamics Corporation (GD - Free Report) reported first-quarter 2022 earnings per share of $2.61, which beat the Zacks Consensus Estimate of $2.49 by 4.8%. Its first-quarter revenues of $9,392 million surpassed the Zacks Consensus Estimate of $8,977.3 million by 4.6%.
General Dynamics recorded a total backlog of $87.23 billion, down 0.4% from the 2021-end backlog. The funded backlog at the first-quarter end was $66.60 billion. In the first quarter of 2022, GD generated cash from the operating activities of $1,968 million, escalating sharply from the only $3 million generated in the year-ago period.
The Boeing Company (BA - Free Report) incurred an adjusted loss of $2.75 per share in the first quarter of 2022, wider than the Zacks Consensus Estimate of a loss of 26 cents. In the quarter under review, Boeing’s revenues amounted to $13.99 billion, which missed the Zacks Consensus Estimate of $16.01 billion by 12.6%.
The backlog at the end of the first quarter of 2022 decreased to $370.84 billion from $377.50 billion at the end of 2021. BA’s operating cash outflow as of Mar 31, 2022 was $3.22 billion.