By Gabriel Araujo
SAO JOSE DOS CAMPOS, Brazil (Reuters) – Brazilian planemaker Embraer reaffirmed its full-year delivery and financial outlook on Tuesday, saying U.S. tariffs so far had “limited impact,” although its CEO added his voice to calls for a return to zero tariffs for the aviation sector.
The world’s third-largest aircraft maker after Airbus and Boeing expects to deliver 77 to 85 commercial jets this year, with executive aviation deliveries between 145 and 155 aircraft.
The company said that early in the year its U.S. content helped to mitigate the impact of President Donald Trump’s tariffs.
It said it had to make operational changes to reduce the exposure of the Phenom and Praetor business jets to the trade conflict, but that its commercial aviation unit was not affected in the first quarter.
The company’s initial estimate is that the tariffs could reduce its operating margins by 90 basis points this year, but it said steps such as additional cost reductions were being taken to limit the impact.
“We join other companies in calling for the return of zero tariff policy for the aviation sector, as has been the case for several decades,” Chief Executive Francisco Gomes Neto told a call with analysts, noting the sector was “highly globalized.”
In the first quarter, a seasonally weaker period for planemakers, Embraer reported a 23% year-on-year increase in net revenues to $1.1 billion, which it said was the highest for the period since 2016.
Core earnings, as measured by adjusted earnings before interest, taxes, depreciation and amortization, more than doubled to $108.6 million, while the closely watched EBITDA margin rose to 9.8% from 5.2%.
Earnings per share, however, fell short of market estimates as the company reported an adjusted loss of $0.40 per share in the quarter. Analysts polled by LSEG expected EPS of $0.01.
“In spite of this miss, the company’s operational results looked solid,” Citi analysts said in a note to clients.
Sao Paulo-traded shares of the Brazilian company – which more than doubled in value in 2024 and hit an all-time high earlier this year – fell around 1% on Tuesday, underperforming the broader Bovespa stock index, which was up 0.2%.
(Reporting by Gabriel Araujo; Editing by Andrew Heavens, Tomasz Janowski and Barbara Lewis)
