update 2 skidoo group in strong position
Amsnow
From Canadian Press Reports
When it was announced that Bombardier Inc. had sold off its Recreational Products Group (which includes Ski-Doo snowmobiles), the French-Canadian company had announced it made $93.2 million or five cents per share in the company's second quarter compared with $68 million or four cents per share in 2002. It was a good day for Bombardier corporate.
Reports in the Canadian Press state that Paul Tellier, Bombardier's chief executive, told a news conference that Laurent Beaudoin's son, Pierre Beaudoin, will remain as head of Bombardier Aerospace. It had been widely rumoured Pierre Beaudoin would go back to managing the recreational products division he previously ran.
Tellier also revealed that he got involved in the final stage of negotiations and managed to raise the price by $25 million, which Bombardier will take as preferred shares in the spun off company.
According to Canadian Press reports, Tellier said the issue of whether the recreational products division will retain the Bombardier name is still under negotiation.
Tellier said recreational products is in a strong position, with world market leadership in the snowmobile and small watercraft. It also makes all terrain vehicles and outboard motors.
He was reported to have commented: "Its future should be very promising and we wish them (new owners) good luck."
He also said the proceeds from the sale will improve Bombardier's debt-to-equity ratio, which had been a cause of concern among debt rating agencies.
The improved corporate results in the quarter came from the aerospace division in which revenues increased to $2.8 billion from $2.7 billion the same period the previous year.
The increase was mainly due to higher deliveries of regional jets, partially offset by a stronger Canadian dollar, which had an impact of about $170 million.
The company delivered 85 aircraft in the quarter compared with 74 last year.
"The trend lines are in the right direction, but there is still a lot of hard work to do," Tellier said.
Under Tellier's leadership since January, the company has issued new shares, cut 3,000 aerospace jobs and announced the sale of recreational products, defence services and most of Bombardier Capital.