The company’s backlog stayed flat at $4.6bn in comparison with the first quarter of 2024.

In the light jet segment, Embraer delivered 18 Phenom 300s, up 80% from the first quarter and flat compared to same period last year. However, it delivered two Phenom 100.

In the mid-size segment, the company delivered three Praetor 500s and four Praetor 600s – flat on a sequential basis while declining from six and five respectively in second quarter of 2023.

So far, in the first half of 2023, Embraer has delivered 45 executive jets against the annual target of 125-135 deliveries. Jet deliveries are seasonal and usually pick up pace in third quarter with major chunk leaving the manufacturers’ hangars in the fourth quarter of fiscal year.

Overall, the company’s total backlog for executive, commercial and services segments hit a seven-year high of $21.1bn, up 20% year-over-year.

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Topline growth came on the back of record first quarter executive jet deliveries of 18 jets compared to eight in the same period last year.

The company delivered one Phenom 100 and 10 Phenom 300s, while delivering three Praetor 500s and four Praetor 600s in the first quarter of 2024 – most aircraft it has delivered in the first quarter for eight years. In addition to higher deliveries, the company also boasted its executive aviation backlog by $300m to $4.6bn.

Following from better topline, Embraer’s gross margin from the executive aviation segment improved from -0.5% to 21.4% improving the adjusted EBIT margin from -42.9% to 5.0% during the first quarter under review.

Overall, the company’s consolidated revenue in the first quarter of 2024 clocked in at $896.6m an increase of 25% year-over-year. This strong growth came on the back of strong performance in the executive aviation segment.

On the bottom line, the company reported adjusted net loss of $12.8m against $88.9m in the same period last year.

“We currently have concrete sales campaigns for more than 200 aircraft across the world,” said Francisco Gomes Neto, CEO, Embraer in the earnings call. Neto further reaffirmed the 2024 guidance of 72 to 80 commercial and 125 to 135 executive jet deliveries, with total revenue target of $6-8bn.

Beyond the results, Neto further said the company is focused on its existing portfolio with no plans on developing narrowbody as has been speculated for a while now.

“We are now in our harvest season. We don’t have concrete plans to develop or launch a narrowbody or other aircraft in the next few years,” said Neto in the earnings call.

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Of the total 115 executive aircraft delivered in the previous year, 74 were light jets whereas the remaining 41 were medium jets.

Higher volumes translated into 13%YoY growth in Embraer’s revenues from executive aviation, reaching $1.4bn. However, the segment’s gross margin dropped from 23.4% to 19.4%YoY owing to product mix (proportionally more medium rather than light jets) and one-time tax benefits.

The Brazilian multinational aerospace company said the positive performance comes amidst ongoing supply chain issues impacting the aviation industry. The company also reported a strong backlog for executive jets, exceeding $4.3bn, reflecting sustained demand across its product portfolio. Moreover, the executive aviation segment ended the year with a book-to-bill in excess of 1.3:1. 

Embraer’s Phenom 300 remained the most delivered light jet for the 12th consecutive year and the most delivered twin-jet for the fourth year running. This highlights the continued popularity of this light jet model in the executive aviation market.

The company said that its positive sales momentum to strong customer acceptance in both retail and fleet markets.

Embraer provided a glimpse into the future of its executive jet business with the announcement of the first Praetor 600 delivery to South Korea’s Flight Inspection Services Center. This variant of the Praetor jet is equipped for a wide range of flight inspection tasks, showcasing the adaptability of Embraer’s executive jets beyond traditional passenger transport.

While Embraer’s executive jet business is experiencing a positive trend, supply chain disruptions continue to pose a challenge. The company said that it is working to mitigate these issues and ensure timely deliveries to customers.

Meanwhile, Embraer reported total revenue of $5.3bn for 2023, reflecting a 16% increase year-over-year. Each of the company’s four business units contributed to this growth.

Defense & Security saw the highest increase at 25%, bringing in $516m. Commercial Aviation followed closely with a 20% rise in revenue, totalling $1.85bn. Rounding out the revenue figures, Services & Support achieved $1.42bn, reflecting a 12% growth.

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Agriculture accounts for a quarter of Brazil’s economy and with some economists forecasting that this is the start of a long-term commodities boom it could soon be more. The hottest new Brazilian telenovela is Terra e Paixão (Land and Passion) where a teacher takes over her murdered husband’s farm.

When you think of South American agriculture companies buying aircraft you probably picture farmers buying crop dusters like Embraer’s Ipanema. The largest agri companies think a lot bigger. JBS, a Brazilian meat producer, had sales of R375bn ($71bn) last year, for example, and has 260,000 employees in more than 20 countries. Large multinationals like this are increasingly looking for options.

“We are seeing strong demand in Brazil. The economy is strong and we are seeing a lot of interest from agribusiness as well as services and retail,” said Stephen Friedrich, chief commercial officer, Embraer talking to CJI in Brazil last week. “We see buyers looking to fly within Brazil and a lot of demand for the Praetor 600’s ability to fly from São Paulo to Miami. A lot of businesses appreciate that.” (Pictured is a Praetor 600, courtesy of Embraer).

The atmosphere at LABACE in São Paulo last week was visibly upbeat. With all the manufacturers attending seeing interest from potential customers. “It is a great time for business aviation in Latin America, we are very excited about Brazil,” said Marcelo Moreira, vice president sales, Textron Aviation.

Moreira says they are seeing strong demand across the Textron range. Textron has delivered more than 250 new turboprops and jets to Brazil over the past five years. He adds: “It is a great market and we have invested a lot into it.”

Brokers are seeing similar interest for pre-owned aircraft. “Agribusiness is our tech industry,” says one Brazilian broker, “but we are also getting a lot of demand from other sectors post-Covid just like in the US.”

Getting aircraft into the country is still complicated. The World Bank used to publish a ranking of the easiest countries in which to run a business. (Ironically it stopped in 2020 due to ethical concerns about the data.) In its last report Brazil ranked 124th.

But Brazil came 184th for ease of paying taxes. In 2019 the World Bank estimated that it took companies an average of 1,500 hours per year (or 187 workdays) to comply with Brazilian tax laws. A Singaporean company would expect to spend just 64 hours.

Tax can be charged at federal, state, and municipal levels and each can have different approaches. There are a lot of taxes involved in importing aircraft – state VAT, import tax, industrial products tax and others. In 2012 Brazil’s tax authority famously seized a number of N-registered jets, but these problems are in the past.  

Large trading companies like Timbro, Comexport, Razac, Sertrading and Savixx have simplified imports and are key players in the market. They were some of the biggest exhibitors at LABACE this year.

Politicians across all the major parties are committed to simplifying the tax system. The lower house approved the first draft and this is now in the Senate. Lawmakers are hoping to have reached agreement by the end of the year although it will take years to come into effect.

“The whole concept of simplification is a good one, but for now the only thing we know for sure is that the Senate will make changes – nothing is finalised yet,” says João Paulo Servera, who heads the aviation group at law firm Veirano Advogados.

One benefit of the import taxes is that aircraft that have been brought in tend to stay in the country. But the real reason they stay is that companies with aircraft in Brazil have a real advantage.

“Brazil is similar in size to the US, but has a lot of room to improve with airline connectivity. We are seeing a lot of businesses looking for aircraft to give them flexibility and efficiency,” says Textron’s Moreira. 

Businesses are waking up to business aviation and smelling the coffee. 

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“The Cessna SkyCourier’s high payload capacity, short takeoff and landing capability, and cost-efficiency make it a great choice for operators in Brazil,” said Lannie O’Bannion, senior vice president, Global Sales and Flight Operations. “The aircraft’s versatility and performance equip customers in the region with smart solutions for their unique missions and circumstances.”

The aircraft offers a combination of performance, capacity and capability, positioning it as a catalyst for enhanced regional connectivity, efficient cargo transportation, and reliable regional passenger operations, said O’Bannion. The SkyCourier is an ideal fit for Brazil’s diverse geography, remote locations and growing demand for air transportation, he added.

Mission profiles include passenger transport, cargo delivery and special operations. With its short takeoff and landing capability, the aircraft can operate from smaller runways, reaching remote communities and serving locations with limited infrastructure. The recently certified gravel kit option further expands the SkyCourier’s capability to operate from unimproved runways.

The aircraft is powered by two wing-mounted Pratt & Whitney PT6A-65SC turboprop engines and features the McCauley Propeller C779, a 110-inch aluminium four-blade propeller, which is full feathering with reversible pitch, designed to enhance the performance of the aircraft while hauling large loads.

The SkyCourier is operated with Garmin G1000 NXi avionics. It has a maximum cruise speed of more than 20 ktas and a 900 nautical-mile maximum range. The aircraft features a large cargo door and a flat floor cabin, and the freighter variant can hold up to three LD3 shipping containers with an impressive 6,000 pounds of payload capability.

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The students will have the opportunity to learn how to work with data analysis and the Python programming language, which has applications in data science, artificial intelligence, and automation. Applications will be accepted until September 3rd through the link: Embraer: Embraer Social Tech Careers. The initiative is carried out in partnership with Gama Academy, a school that selects talent and trains professionals for the digital market in technology areas.

“Embraer Social Tech combines education and innovation to contribute to the development of a more inclusive society,” said Andreza Alberto, vice president, People, ESG and Corporate Communications, Embraer. “We are very proud of this affirmative action focused on quality education for women who want to enter the technology market.”

Participants who complete the course, which lasts four months, will join Embraer and partner companies’ talent databases in future selection processes. The course will use a boot camp methodology, which includes remote immersive training to develop skills and competencies in the technology sector.

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To mark the milestone, Flapper co-founder and CEO Paul Malicki surprised the football-loving passenger with a gift before he boarded the flight at Rio de Janeiro’s airport. The themed merchandise was specially designed based the client’s flight history, which included charters to the Copa Libertadores finals.

“It feels as if we are only beginning our journey,” Malicki told Corporate Jet Investor. “Taking into account the size of our accessible market and the advancement of our technology, we are making an internal prediction of how long it will take us to acquire 100,000 paid customers.” 

Flapper prepared a set of personalised items signed by Rio de Janeiro’s Flamengo football club. “Our client’s enthusiasm for the club had been well-known for a long time, having chartered flights to their games in the past, so it was an effortless guess,” said Malicki. The list included a leather bag, a wine holder, a knitted polo shirt and, of course, a pair of Flapper-themed socks.

Malicki said technology has allowed the air charter brokerage industry to be scalable, so it no longer requires an extensive workforce of 500 or so to operate. Headquartered in Brazil and with local operations in South America, Mexico, Florida and Portugal, Flapper was launched in 2016. Starting out as a pay-per-seat helicopter booking app, the firm switched to include air charter, including private jets, corporate airliners and turbo-props. Today rotorcraft makes up only 6% of annual revenues, with the core business focused on charter. 

“Our technology has allowed us to automate the traditional charter process and make it more transparent, which was something the market was lacking when we launched. The clients can browse through hundreds of aircraft on our marketplace, receive a hard quote through a personalised link, pay using their desired payment method and rate the flight on TrustPilot (another API integration),” said Malicki.

More than 1,700 safety-vetted aircraft are currently available on Flapper platform, with plans to reach 4,000 by the end of 2024. An in-house team nicknamed ‘Aircraft Hunters’ searches for and adds new commercial jets, turbo-props and helicopters, including those with Part 135 and Part 121 certificates.

Flapper claims its quotation system estimates the price of the charter flight, which can then be arranged in less than 2 hours, it claimed. Flapper also integrates with online systems of the local civil authorities – including Brazil’s ANAC – and automatically refreshes the aircraft’s airworthiness status. Future plans include integration with the flight tracking software, as well as flight management systems.

“We are 100% focused on the launch of Flapper 3.0, i.e. completely refined Flapper app. It will feature medevac services, high-value cargo and urban air mobility, aside from regular business charters. Once launched, it will surely be the most complete product on the market, evidencing eight years of hard work by our technology team,” he explained. 

Last year, Flapper launched an aircraft sales department, led by Giampiero Colognori. The used aircraft marketplace is available within the same app and features a list of over 100 private jets and helicopters. As well as brokering aircraft sales, the platform also offers consultancy services including complete pre-sale checks, financing and international aircraft transfer. “To our surprise, our first customer came from Europe while we registered a few aircraft sold in Latin America, too. The used aircraft market has a fairly long sales cycle and we are working on improving our technology, especially on the mobile app,” said Malicki.

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ARGUS is widely considered the “most accurate and detailed third-party due diligence system” for registered charter brokers globally. 

Ed Wandall, ARGUS, vice president, said: “Flapper not only has an impressive technology platform, but highly skilled and knowledgeable people throughout their organisation. They perform a high level of due diligence on all their flights and have forged valuable relationships with the Civil Aviation Authorities in South America.”

In the last year Flapper integrated with the API of the Brazilian Civil Aviation Authority, allowing daily verification of all Part 135-registered aircraft in the country. Flapper’s next step is to integrate with similar APIs to assure full Part 135 compliance of aircraft inventory in its systems.

Paul Malicki, CEO of Flapper added: “From training of our team members to carefully selecting partner operators, to meticulously planning every flight, we are committed to the industry’s best practices. As we are expanding our international footprint, we’d like to further benefit from access to ARGUS data, its impressive know-how and experienced team.”

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The Brazilian OEM delivered 15 light and eight midsize jets compared with 12 light and nine large aircraft in Q2 2022. It is also an increase on the 21 jets delivered in the same period in 2021. 

In the year, Embraer has delivered a total of 52 executive aircraft. The firm order backlog ended Q3 at $17.8bn. The firm says it is on course to meet its delivery guidance of 100-110 aircraft.

The company will release its full Q3 earnings results on Friday (November 11th).

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Due to regulation and taxation requirements in the country, which mean satellite communications must come through a local provider, it was necessary to partner with Satcom Direct as it already has an established presence in Brazil, according to Viasat.

“Satcom Direct has been a reseller for Viasat for many years and they set up that division in Brazil to support customers who are based or registered in Brazil,” said Scott Hamilton, director of strategy for Business Aviation, Viasat. He said that Brazil is one of the largest aviation markets in the world due to its size and remote territory with little infrastructure. “It really points to how flexible we’re able to be, to create a whole new regional service plan for customers who primarily operate in Brazil,” he said.

Claudio D’Amico, business area director for Business Aviation, Viasat, said: “Brazil is about the size of the United States, excluding Alaska, so it really justifies a regional plan since it’s in this corner of the world in a unique spot.”

Viasat has some presence in Brazil already through its partnership with Brazilian government-owned Telebras to operate SGDC-1, a Ka-band satellite which Viasat says covers 100% of Brazil. This partnership with Satcom Direct marks the first business aviation coverage by Viasat in the country.

Earlier this month, Viasat was selected as the connectivity provider for Airshare’s Bombardier deliveries. In June, Viasat’s stockholders voted to approve a $7.3bn deal to acquire Inmarsat, which is expected to close in the second half of this year subject to regulatory approvals.

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