Embraer (EMBR3) reverses the loss and reports adjusted net income of R$327.2 million in the fourth quarter

Embraer (EMBR3) made an adjusted net profit – ignoring one-time effects – a total of R$327.2 million in the fourth quarter of 2021, reversing a loss of R$70.3 million in the fourth quarter of 2020. Unadjusted result, the company made a profit of R$11.1 million , which is also better than R$7.7 million in the same period in 2020.

Embraer’s net revenue between October and December was R$7.824 billion and R$22.6 billion for the full year. In the fourth quarter of 2020, revenue was R$9.812 billion, and in this entire year, revenue was R$19.64 billion.

Of last quarter’s revenue, commercial aviation was responsible for R$2.3 billion, executive aviation was responsible for R$2.5 billion, and the defense and security sector accounted for R$639 million. Total services and support amounted to R$1.7 billion. All segments recorded revenue growth in 2021.

Embraer delivered 55 aircraft in the fourth quarter, including 16 commercial aircraft and 39 private jets. In 2021, the company delivered a total of 141 aircraft, of which 48 were commercial aircraft and 93 were private aircraft. The December order backlog ended at $17.0 billion, the highest level since June 2018.

The company also highlights that its gross margin, with the ratio of gross profit to total revenue, and discounting expenses with products sold, increased from 12.1% in the last quarter of 2020 to 15% in 2021. Gross profit margin was 15.6% versus 12.3% In the immediately preceding 12 months.

Last quarter, Embraer reported an adjusted earnings before interest and income tax (Ebit) of R$891.1 million, with a margin of 3.9% — compared to an operating loss of R$523 million, R$7 million in the same period in 2020 and a negative margin of 2.7%.

And he explained: “The modified Ebit in the last quarter was affected by the account of 49.9 million Brazilian riyals arising from the OneEmbraer program, which aims to reintegrate the commercial aviation business and related services, in relation to the strategic partnership, which has now ended with Boeing,” the company in the document published in the evening Wednesday (9).

This year, the company also recorded a series of other non-recurring impacts – the adjusted net loss in 2021 was R$162.6 million while the net result was R$274.8 million. Among the “special items”, the most notable gain of 318.6 million R$ was from a reflection ruin Executive Aviation and to spend 254.8 million Brazilian riyals in ruin of assets held for sale.

Embraer ended December with a net debt position of R$7.7 billion, compared to R$9.8 billion at the end of the third quarter and R$8.8 billion in December 2020. The net cash flow was the result of significant free cash flow generation in the quarter,” they comment. Free cash flow 1.6 billion Rls.

In 2022, Embraer expects advances in deliveries

Embraer expects to deliver between 60 and 70 commercial aircraft this year and expects to deliver between 100 and 110 deliveries in the Executive Aviation segment.

As for net revenue, the aircraft maker expects between $4.5 billion and $5 billion, with Ebitda’s margin between 8% and 9%. The expected free cash flow is R$50 million for the period.

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