Bombardier confirms progress on turnaround plan; announces initiatives to ensure competitiveness and improve margins
October 21 2016 - 6:40AM
-
Actions include streamlining
administrative and non-production functions across the
organization
-
Footprint optimization and site
specialization actions to reduce costs and improve
productivity
-
Expect recurring savings of
approximately $300 million by the end of 2018; charge to be
recorded in 2016-2017 to support actions
MONTREAL, QUEBEC--(Marketwired - Oct 21, 2016) -
Bombardier announced today a series of actions as it continues to
execute its five-year turnaround plan launched last year. The
actions support the company's efforts to build its earnings growth
potential and highlight its focus on improving productivity,
reducing costs and optimizing its worldwide footprint to deliver
increased value to customers and shareholders.
"After successfully de-risking our business last
year, our focus has shifted to building a clear path to profitable
earnings growth and cash generation. The actions announced today
will ensure we have the right cost structure, workforce and
organization to compete and win in the future," said Alain
Bellemare, President and Chief Executive Officer, Bombardier Inc.
"We are confident in our strategy, our leadership team and our
ability to achieve both our 2016 goals and our 2020 turn-around
plan objectives."
Specific actions to be taken by the company
include streamlining its administrative and non-production
functions across the organization and leveraging its worldwide
footprint to create centres of excellence for design, engineering
and manufacturing activities in both its aerospace and rail
businesses.
Approximately 7,500 positions will be impacted as
the company executes its workforce optimization and site
specialization actions through 2018. The impact of these
restructuring actions on overall employment will be partially
offset by strategic hiring to support the ramp-up for key growth
programs, including the C Series and Global 7000, as well as to
support major rail contract wins.
As a result of the actions announced today, the
company expects to achieve recurring savings of approximately $300
million by the end of 2018. The company anticipates recording $225
million to $275 million in restructuring charges that will be
reported as special items when accrued, starting in the fourth
quarter of 2016 and continuing through 2017.
"When we launched our turnaround plan last year we
committed to transforming our company; to reduce costs, to leverage
our scale and to become more efficient in all our operations, and
that is exactly what we are doing," said Bellemare. "While
restructuring is always difficult, the actions announced today are
necessary to ensure Bombardier's long-term competitiveness and
position the company to continue to invest in its industry leading
portfolio while also deleveraging its balance sheet."
About Bombardier
Bombardier is the world's leading manufacturer of
both planes and trains. Looking far ahead while delivering today,
Bombardier is evolving mobility worldwide by answering the call for
more efficient, sustainable and enjoyable transportation
everywhere. Our vehicles, services and, most of all, our employees
are what make us a global leader in transportation.
Bombardier is headquartered in Montreal, Canada.
Our shares are traded on the Toronto Stock Exchange (BBD) and we
are listed on the Dow Jones Sustainability North America Index. In
the fiscal year ended December 31, 2015, we posted revenues of
$18.2 billion. News and information are available at bombardier.com
or follow us on Twitter @Bombardier.
Bombardier, C Series, Global, Global 7000 and The
Evolution of Mobility are trademarks of Bombardier Inc. or its
subsidiaries.
Contact Information
Contacts:
Simon Letendre
Senior Advisor, Public Affairs
Bombardier Inc.
+514 861 9481
Patrick Ghoche
Vice President, Investor Relations
Bombardier Inc.
+514 861 5727
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Bombardier Transportation via Globenewswire
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