NetJets cancellations to cost Hawker Beechcraft $2.6 billionBY MOLLY McMILLIN
The Wichita Eagle
Hawker Beechcraft announced today that fractional ownership company NetJets has canceled a "significant" number of aircraft it had on order with the company.
The cancellations will reduce Hawker Beechcraft's backlog by $2.6 billion and represent 90 percent of the aircraft that NetJets has on order with Hawker Beechcraft.
The aircraft were to have been delivered over several years beginning in 2011.
Hawker Beechcraft also said today that revenue for the fourth quarter of 2009 is expected to be about $1.9 billion, bringing estimated yearly revenue to about $3.2 billion.
Operating income for the quarter, meanwhile, is expected to be between about zero and a loss of $15 million. Full-year operating losses are estimated to be between $725 million and $740 million.
After adjusting for the canceled NetJets orders, the company's backlog at the end of 2009 is expected to be $3.5 billion.
So far this year, NetJets has canceled 12 aircraft it had on order and deferred delivery of all jets scheduled for delivery in 2009 or 2010 until the end of 2010.
Hawker Beechcraft has said that NetJets wasn't expected to provide any substantial revenue in 2009 or 2010. The company historically has not represented more than 10 percent of Hawker Beechcraft's annual revenue.
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