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Embraer eyes 'very strong' H2 after solid Q2 deliveries; shares rise

Published 07/19/2024, 04:30 PM
Updated 07/19/2024, 04:40 PM
© Reuters. FILE PHOTO: Commercial jets are pictured at Embraer's headquarters in Sao Jose dos Campos, Brazil, June 19, 2024. REUTERS/Gabriel Araujo/File Photo
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By Gabriel Araujo

SAO JOSE DOS CAMPOS, Brazil (Reuters) - Brazilian planemaker Embraer is gearing up for a "very strong" second half after meeting its expectations for deliveries in the first half of 2024, Chief Financial Officer Antonio Carlos Garcia said on Friday.

The world's third-largest planemaker behind Airbus and Boeing (NYSE:BA) reported on Thursday total deliveries of 47 aircraft in the second quarter, up 88% on a sequential basis, including 19 commercial and 27 executive jets.

That brought deliveries in 2024 so far to 71, up from 62 in the same period last year.

"Everything was within our expectations," Garcia told reporters on the sidelines of Embraer's headquarters. "This shows we are on the path to growth."

Embraer plans to deliver 72 to 80 commercial aircraft this year, up from 64 last year, as well as 125 to 135 business jets, up from 115 in 2023.

Garcia said Embraer is confident it will meet its guidance, echoing remarks made by CEO Francisco Gomes Neto in an interview with Reuters last month.

"Third and fourth quarters will be very strong," Garcia said about a period that is seasonally busier for planemakers. "There are still some supply chain issues but we are very confident that we will meet our guidance."

Embraer shares rose over 2% on Friday after the delivery report, making it one of the top gainers on Brazil's Bovespa stock index, which was flat. Year-to-date, Embraer is up almost 90%.

Analysts at BTG Pactual said the operating results were solid, beating their commercial aviation forecast although with slightly lower-than-expected executive aviation deliveries.

© Reuters. FILE PHOTO: Commercial jets are pictured at Embraer's headquarters in Sao Jose dos Campos, Brazil, June 19, 2024. REUTERS/Gabriel Araujo/File Photo

"Deliveries posted a major quarter-on-quarter improvement, leading us to reiterate our expectation of positive second-quarter results", they said. "Most importantly, the company's solid backlog also sustains its supportive short-term momentum."

Embraer has been experiencing positive demand amid Airbus' and Boeing's extended delivery deadlines. It will participate next week at the Farnborough Air Show, where planemakers often announce major orders.

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