‘Extremely challenging’ year pushes Bombardier NI arm to $53m loss
Workforce reduction cost $16.2m for Montreal-headquartered aircraft maker
Bombardier’s NI operations suffered in tandem with the company as a whole last year after the US department of commerce confirmed it was investigating its US trade practices. Photograph: Clodagh Kilcoyne/Reuters
Bombardier’s Irish arm – Short Brothers plc – reported a 0.9 per cent rise in turnover to $879 million, but slid to a €52.9 million loss before tax compared to a profit the previous year of €76.2 million.
A strategic report in the accounts for 2017 shows that the directors are focusing on “major cost reduction” over the short to medium term, which includes reducing procurement costs and improving labour efficiency while also transferring “certain uncompetitive activities to sister sites in Mexico and Morocco”.
In 2017, Short Brothers took a restructuring charge of $16.2 million having announced a workforce reduction of 375 people. It employed 4,071 people in the year, with wage and salary costs totalling $184 million.
“2017 marked the third year of Bombardier’s five-year global turnaround plan, and was once again an extremely challenging one for our Northern Ireland operations,” the directors said.
“The financial projections for the next two years show that the company is expected to generate positive free cash flow from operating activities on its own account.”
Bombardier’s NI operations suffered in tandem with the company as a whole last year after the US department of commerce confirmed it was investigating its US trade practices. The department’s determinations were ultimately overturned by the US International Trade Commission.
The North is used by the company to manufacturer wings for its C-Series aircraft with the primary assembly line in Montreal, Canada. Short Brothers were also last year selected by Airbus as a supplier on a new engine programme for the Airbus A320neo.
In October, the planemaker entered an agreement with Airbus to improve sales of its C-Series aircraft. Some $337 million of Short Brothers turnover was generated by commercial aircraft with business aircraft accounting for $199 million.
During 2017 Short Brothers generated the majority of its revenue in Canada and the US with the rest of the world accounting for just under $300 million.
Short Brothers held $36.19 million in the bank, down from $50 million the year previously.
Montreal-based Bombardier also makes train parts in addition to its aircraft operations.