São Paulo – Embraer had net profit of R$ 697.8 million (US$ 349 million) in 2012, growth of 346.4% over the 2011 result, when the net profit had been R$ 156.3 million (US$ 78 million). In the fourth quarter, the company profit was R$ 253.7 million (US$ 127 million). In the same period in 2011, the Brazilian aircraft maker recorded loss of R$ 171.6 million (US$ 86 million). In 2012, company revenues also grew: to R$ 12.2 billion (US$ 6.1 billion), 24.8% more than the R$ 9.8 billion (US$ 4.9 billion) obtained in 2011.
In an audioconference on Wednesday (13), the Financial and Investor Relations executive vice president at Embraer, José Antônio Filippo, stated that this was the company’s largest profit over the last five years and attributed the result to economic conjecture. “The main causes were the effect of (appreciation of) the dollar and tax breaks promoted by the government in the Brasil Maior (a program launched in 2011 to increase the competitiveness of Brazilian industry through lower taxes),” he said.
The company ended 2012 with a firm order backlog of US$ 12.5 billion, a drop over the US$ 15.4 billion of 2011. According to Filippo, this order volume should record growth in results of the first quarter of 2013 as it should include the sale of 47 aircraft to the North American Republic Airways, to operate the aircraft on the American Airlines routes. The negotiation was announced still in 2012, but should only be included in the budget now, as the deal depended on approval of the North American legal system.
Commercial aviation was responsible for most Embraer revenues in 2012: R$ 7.3 billion (US$ 3.7 billion), or 60.4% of the total. The defence and security sector generated revenues of R$ 2.08 billion (US$ 1.04 billion, 17.1%) and executive aviation resulted in R$ 2.6 billion (US$ 1.3 billion). Another 1.2% of revenues were generated by other of the company’s assets. The participation of defence and safety divisions and executive aviation rose 44% and 34%, respectively, over the 2011 result. According to Filippo, this tendency should continue in coming years.
Previously the company had disclosed that in 2012 it had delivered 106 commercial aviation jets, one more than in 2011. Among them, there were 62 Embraer 190, 23 Embraer 195, 20 Embraer 175 and one Embraer 170. In executive aviation, 99 aircraft were delivered (like in 2011), of which 77 were light jets and 22, large ones. The company did not disclose how many defence and security aircraft were delivered in 2012.
“There was growth in participation of executive aviation and defence and security and a reduction in commercial aviation, but the latter should remain for a long time as the company’s main area,” he said. The executive added that in 2013, commercial aviation should be responsible for 52% of revenues, executive for 25% and safety and security for 21%. Other assets should contribute with 2% of Embraer revenues this year.
Middle East and Africa
Filippo also said that the company has plans for expansion in the Middle East and Africa and stated that the main opportunities are in the defence and security sector. “Africa has important perspectives, and (may reach) greater participation in the defence area. But commercial aviation has grown. The Middle East and Africa still has a small share of participation as a whole, but there are perspectives for greater presence,” he said. In 2012, Embraer delivered an A-29 Super Tucano aircraft to the Mauritanian air force.
Filippo also said, while disclosing the company results, that Embraer should start assembly of 20 Super Tucano Airfract in Jacksonville. Embraer won a tender in the United States and hopes to confirm the result to start producing the aircraft. Still in 2013, the company should announce the release of a new generation of the E-jet family, which includes the E-170, E-175, E-190 and E195.
*Translated by Mark Ament
