Brazil's Embraer , the world's third-largest planemaker, expects a modest increase in revenue this year thanks to the expansion of its defense unit, as regional-jet and executive aviation markets remain stable.
Embraer said in a filing on Thursday it expects net revenue of $5.8 billion to $6.2 billion this year, after meeting estimates for 2011 revenue of $5.6 billion to $5.7 billion.
"Considering more accelerated growth in the area of defense and security and stable markets for executive aviation and commercial aviation, the company expects revenue may grow slightly in 2012," Embraer said in the filing.
Luiz Carlos Aguiar, the head of Embraer's Defense and Security unit, told Reuters last month his segment could make up a quarter of total revenue by 2020, up from an estimated 14 percent last year and under 5 percent in 2006.
The estimates issued on Thursday suggest 17 percent of revenue this year will come from executive aviation, excluding services, down from 21 percent in the original 2011 estimates. A shakier outlook for the global economy prompted a string of cancellations for Embraer's business jet orders last year.
Embraer said it expects to deliver between 105 and 110 commercial aircraft this year after delivering 105 commercial jets last year. In executive aviation, the company expects to deliver 15 to 20 large jets and 75 to 85 light jets in 2012, after delivering 16 large jets and 83 light jets last year.
Embraer expects stable demand in the regional commercial aviation market, which it dominates, allowing it to replace deliveries with new orders of similar value. The company ended 2011 with a backlog of firm orders around $15.4 billion.
The planemaker's chief rival for the segment, Canada's Bombardier Inc, said late last year it would cut regional jet production because of economic uncertainty.
Embraer plans to invest about $650 million this year, up from the $450 million earmarked for 2011. The company said a flood of fourth-quarter deliveries brought its free cash to about $470 million at the end of last year.
Shares of Embraer closed 0.7 percent lower at 12.02 reais in Sao Paulo on Thursday, little changed after the estimates were posted to the website of Brazil's securities regulator and close to the 0.5 percent drop on the benchmark Bovespa stock index .
Article Source : Reuters
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