Brazil's Embraer, the world's fourth-largest maker of commercial aircraft, on Friday reported a first-quarter net profit sharply lower from a year ago, citing a stronger local currency.
Embraer had a net profit of 86.9 million reais ($40.8 million) in the first quarter, down from a 233.8 million reais profit in the year-earlier period.
A stronger Brazilian real reduced export revenue as well as profit margins, the company said. A 17.7 percent year-on-year appreciation of the real against the US dollar was offset only partially by a 6 percent increase in dollar-denominated sales, Embraer said in a statement.
Earnings before interest, tax, depreciation and amortisation, a measure of cash flow known as EBITDA, fell to 179 million reais from 362.1 million reais a year earlier.
Embraer has been expanding its business jet operations as it seeks to diversify its revenue base, which heavily depends on planes for commercial airlines. Its main rival, Bombardier Inc of Canada, is already an aggressive player in this market segment.
The Brazilian company delivered 27 aircraft during the quarter, of which 21 were commercial jets. Embraer finished the quarter with a firm order backlog totalling $10.4 billion. Its shares closed down 4.17 percent at 19.31 reais on Friday before the results were announced. Company officials are to hold an investor conference broadcast on the Internet on Monday to explain first quarter results.
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