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Embraer (ERJ) Q4 Earnings Surpass Estimates, Revenues Down Y/Y
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Embraer S.A. (ERJ - Free Report) reported fourth-quarter 2023 adjusted earnings of 42 cents per American Depository Share (ADS), which beat the Zacks Consensus Estimate of 27 cents by 55.6%. The bottom line also came in higher than 18 cents reported in the prior-year quarter.
The company reported quarterly GAAP earnings of $1.05 per ADS compared with 33 cents reported in fourth-quarter 2022.
For 2023, the company reported adjusted earnings of 43 cents per ADS compared with 21 cents recorded in 2022.
Embraer-Empresa Brasileira de Aeronautica Price, Consensus and EPS Surprise
Embraer’s fourth-quarter revenues totaled $1,975.1 million, down 0.8% year over year, primarily due to lower revenues from its Executive Aviation and Commercial Aviation business segments. The reported figure also missed the Zacks Consensus Estimate of $2,213 million by 10.8%.
For 2023, the company recorded revenues worth $5.27 billion, up from $4.54 billion reported in 2022.
Order & Delivery
Embraer delivered 75 jets in the reported quarter. It delivered 25 commercial and 49 executive (30 light and 19 midsize) jets compared with 15 commercial and 28 executive (19 light and nine midsize) jets in the prior quarter.
The backlog at the end of the fourth quarter was $18.7 billion compared with $17.8 billion at the end of the third quarter of 2023.
Operational Highlights
Embraer’s operating income amounted to $209 million in the fourth quarter of 2023 compared with $141.8 million reported in the fourth quarter of 2022.
The company posted a quarterly adjusted EBITDA of $253.5 million, which increased 11.1% from the year-earlier quarter’s figure.
Financial Update
As of Dec 31, 2023, ERJ’s cash and cash equivalents amounted to $1,629.2 million compared with $1,816.9 million as of Dec 31, 2022.
The company had long-term debt of $2,759.3 million as of Dec 31, 2023, down from $2,894.7 million as of Dec 31, 2022.
Its adjusted free cash flow in 2023 totaled $223.7 million compared to free cash flow of $477.6 million reported in the prior-year period.
Guidance
Embraer announced its guidance for 2024. It expects 72-80 commercial jet deliveries and 125-135 Executive Aviation deliveries in the year.
The company anticipates revenues to be in the range of $6.0-$6.4 billion in 2024. The consensus estimate for ERJ’s 2024 revenues is pegged at $6.25 billion, which lies above the midpoint of the company’s guided range.
For 2024, Embraer anticipates the adjusted EBIT margin between 6.5% and 7.5%, and free cash flow of $220 million or more.
Lockheed Martin Corporation (LMT - Free Report) reported fourth-quarter 2023 adjusted earnings of $7.90 per share, which beat the Zacks Consensus Estimate of $7.26 by 8.8%. The bottom line also improved 1.4% from the year-ago quarter's recorded figure.
Net sales were $18.87 billion, which surpassed the Zacks Consensus Estimate of $17.98 billion by 4.9%. The top line, however, decreased 0.6% from $18.99 billion reported in the year-ago quarter.
General Dynamics Corporation (GD - Free Report) reported fourth-quarter 2023 earnings per share of $3.64, which missed the Zacks Consensus Estimate of $3.66 by 0.6%. However, the figure increased 1.7% from $3.58 recorded in the year-ago quarter.
In the quarter under review, revenues of $11,668 million beat the Zacks Consensus Estimate of $11,543 million by 1.1%. The top line also improved 7.5% from the prior-year reported figure.
Textron Inc. (TXT - Free Report) reported fourth-quarter 2023 adjusted earnings of $1.60 per share, which surpassed the Zacks Consensus Estimate of $1.53 by 4.6%. The bottom line also improved 30.1% from the year-ago quarter’s recorded figure.
TXT reported total revenues of $3,892 million, which missed the Zacks Consensus Estimate of $3,917.6 million by 0.7%. However, the reported figure increased 7% from the year-ago quarter’s level of $3,636 million.
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Embraer (ERJ) Q4 Earnings Surpass Estimates, Revenues Down Y/Y
Embraer S.A. (ERJ - Free Report) reported fourth-quarter 2023 adjusted earnings of 42 cents per American Depository Share (ADS), which beat the Zacks Consensus Estimate of 27 cents by 55.6%. The bottom line also came in higher than 18 cents reported in the prior-year quarter.
The company reported quarterly GAAP earnings of $1.05 per ADS compared with 33 cents reported in fourth-quarter 2022.
For 2023, the company reported adjusted earnings of 43 cents per ADS compared with 21 cents recorded in 2022.
Embraer-Empresa Brasileira de Aeronautica Price, Consensus and EPS Surprise
Embraer-Empresa Brasileira de Aeronautica price-consensus-eps-surprise-chart | Embraer-Empresa Brasileira de Aeronautica Quote
Total Revenues
Embraer’s fourth-quarter revenues totaled $1,975.1 million, down 0.8% year over year, primarily due to lower revenues from its Executive Aviation and Commercial Aviation business segments. The reported figure also missed the Zacks Consensus Estimate of $2,213 million by 10.8%.
For 2023, the company recorded revenues worth $5.27 billion, up from $4.54 billion reported in 2022.
Order & Delivery
Embraer delivered 75 jets in the reported quarter. It delivered 25 commercial and 49 executive (30 light and 19 midsize) jets compared with 15 commercial and 28 executive (19 light and nine midsize) jets in the prior quarter.
The backlog at the end of the fourth quarter was $18.7 billion compared with $17.8 billion at the end of the third quarter of 2023.
Operational Highlights
Embraer’s operating income amounted to $209 million in the fourth quarter of 2023 compared with $141.8 million reported in the fourth quarter of 2022.
The company posted a quarterly adjusted EBITDA of $253.5 million, which increased 11.1% from the year-earlier quarter’s figure.
Financial Update
As of Dec 31, 2023, ERJ’s cash and cash equivalents amounted to $1,629.2 million compared with $1,816.9 million as of Dec 31, 2022.
The company had long-term debt of $2,759.3 million as of Dec 31, 2023, down from $2,894.7 million as of Dec 31, 2022.
Its adjusted free cash flow in 2023 totaled $223.7 million compared to free cash flow of $477.6 million reported in the prior-year period.
Guidance
Embraer announced its guidance for 2024. It expects 72-80 commercial jet deliveries and 125-135 Executive Aviation deliveries in the year.
The company anticipates revenues to be in the range of $6.0-$6.4 billion in 2024. The consensus estimate for ERJ’s 2024 revenues is pegged at $6.25 billion, which lies above the midpoint of the company’s guided range.
For 2024, Embraer anticipates the adjusted EBIT margin between 6.5% and 7.5%, and free cash flow of $220 million or more.
Zacks Rank
Embraer currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Releases
Lockheed Martin Corporation (LMT - Free Report) reported fourth-quarter 2023 adjusted earnings of $7.90 per share, which beat the Zacks Consensus Estimate of $7.26 by 8.8%. The bottom line also improved 1.4% from the year-ago quarter's recorded figure.
Net sales were $18.87 billion, which surpassed the Zacks Consensus Estimate of $17.98 billion by 4.9%. The top line, however, decreased 0.6% from $18.99 billion reported in the year-ago quarter.
General Dynamics Corporation (GD - Free Report) reported fourth-quarter 2023 earnings per share of $3.64, which missed the Zacks Consensus Estimate of $3.66 by 0.6%. However, the figure increased 1.7% from $3.58 recorded in the year-ago quarter.
In the quarter under review, revenues of $11,668 million beat the Zacks Consensus Estimate of $11,543 million by 1.1%. The top line also improved 7.5% from the prior-year reported figure.
Textron Inc. (TXT - Free Report) reported fourth-quarter 2023 adjusted earnings of $1.60 per share, which surpassed the Zacks Consensus Estimate of $1.53 by 4.6%. The bottom line also improved 30.1% from the year-ago quarter’s recorded figure.
TXT reported total revenues of $3,892 million, which missed the Zacks Consensus Estimate of $3,917.6 million by 0.7%. However, the reported figure increased 7% from the year-ago quarter’s level of $3,636 million.