Embraer (EMBR3) posted a 77.4% drop in adjusted loss in the third quarter, to R$179.7 million; The company changes cash flow forecasts

Embraer (EMBR3) reported an adjusted net loss of R$ 179.7 million in the third quarter of 2021 (the third quarter of year 21), compared to a loss of R$ 797.5 million in the same period of 2020, a decrease of 77.47%.

Total net revenue amounted to R$5.010 billion in the first quarter, an increase of 22.5% compared to the same period in the previous year, when it achieved R$4.0905 billion.

The company explained that double-digit revenue growth occurred in all business segments. The company indicated that “this financial result is due to the delivery of nine commercial aircraft and 21 executive aircraft in the months of July, August and September, in addition to advances from customers who signed aircraft purchase contracts in this period.”

Gross adjusted EBITDA was R$410.7 million in Q321, versus a negative EBITDA of R$40.7 million in Q3 2020.

Ebitda’s adjusted margin (Ebitda/net revenue) was 8.2% in the third quarter of 2021, versus a negative margin of 1% in the third quarter of 2020.

Consolidated gross margin in the third quarter of the year was 21.9% versus 7.3% recorded in the third quarter of 2020.

Regarding net debt, the company reported an indentation of 26.4% to R$9.810 billion.

The company also revised its cash flow forecast.

In the first nine months of 2021, Embraer reported cumulative free cash flow of $160.1 million, which is an improvement over the company’s initial forecast for free cash flow performance in the period. Embraer also expects fourth-quarter deliveries and revenue to be consistent with the seasonal pattern observed in previous years, leading to positive cash flow in Q421.

Thus, Embraer (EMBR3) has updated its free cash flow forecast for 2021, from $150 million to zero (the breakeven point) to a forecast of $100 million or more for this year. Other forecasts previously disclosed remain unchanged.

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