Bombardier burns more cash than expected on ramp up in jet production
Adds earnings details, deal with Spirit AeroSystems
MONTREAL, Oct 31 (Reuters) - Canadian plane and train maker Bombardier Inc BBDb.TO used more cash than analysts had expected in the third quarter as it ramped up production of its flagship Global 7500 business jet and pushed back some train deliveries.
The Montreal-based company is in the middle of a broader restructuring, shedding underperforming commercial plane programs to focus on its more profitable business jet and rail units.
Bombardier free cash flow usage for the quarter ended Sept. 30 rose 84% to $682 million, compared with a year earlier.
The company, however, said its free cash flow usage for the year would remain around $500 million.
Analysts on average were expecting free cash outflow of $332.98 million, according to IBES data from Refinitiv.
Bombardier faced a cash crunch in 2015 after investing heavily to bring two new planes to market.
In August, the company lowered its full-year earnings and cash flow forecasts and reported a quarterly loss as it faced challenges in its rail division.
Bombardier also missed estimates for its most-watched measure of earnings, hurt by higher costs. Earnings before interest and taxation (EBIT) was $143 million for the quarter, below analysts' estimates of $157.15 million.
Bombardier also announced a deal to sell two aerostructures facilities and a smaller U.S. repair plant to Spirit AeroSystems Holdings Inc SPR.N. Reuters reported that the two were in advanced talks on Wednesday night.
(Reporting By Allison Lampert in Montreal; Editing by Shinjini Ganguli and Anil D'Silva)
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