Textron Aviation’s first-quarter aircraft delivery performance painted a mixed picture, with steady jet shipments but declining turboprops. The Wichita-based aircraft manufacturer today said it handed over 36 Citations, one more than the same three months a year ago.
These 36 twinjets included four M2 Gen2s, six CJ3+s, six CJ4 Gen2s, two XLS+s, 13 Latitudes, and five Longitudes. The big year-over-year change was a shift in more Latitude deliveries (from seven to 13) and fewer XLS+s (from five to two).
Turboprops, however, saw a marked decrease over the same period: 20 versus 34 shipments. Notably, deliveries of the Caravan turboprop single declined to 12 from 19, and twin-turboprop King Airs fell to seven from 12 in the previous year. The company also handed over one SkyCourier twin, down from three in first-quarter 2023.
Textron Aviation reported first-quarter revenues of $1.2 billion, an increase of $39 million from the same period last year. This growth was primarily driven by higher pricing strategies, which added $48 million, though partially offset by a slight decrease in volume and mix amounting to $9 million.
“Segment profit was $143 million in the first quarter, up $18 million from a year ago, reflecting a favorable impact from pricing net of inflation of $14 million,” said Frank Connor, CFO of parent Textron Inc.
“We certainly expect to see a nice growth on a year-over-year basis,” Scott Donnelly, Textron president and CEO, commented in response to a question about the outlook for 2024 compared with the 168 aircraft delivered in 2023. “The supply chain does continue to improve the number of hours that we're able to get in the factory. We feel pretty good about how things progressed through the [first] quarter. But we always have a few aircraft that we would like to have gotten delivered.
“What's important to us is to maintain the spread of net pricing over inflation. That's really most of the work as we go through the course of the year—managing the inflation numbers around supply base and things like that. I would expect to see positive price over inflation through the course of the year.”
Donnelly remarked that supply-chain issues, inflation, and internal operating performance are likely to continue to affect Textron Aviation in the second quarter.
Textron Aviation’s backlog grew to $7.3 billion, marking an increase of $177 million.
On the other hand, Textron’s eAviation segment reported revenues of $7 million. However, the segment recorded a loss of $18 million, doubling its loss from first-quarter 2023. This was largely attributed to heightened research and development expenses aimed at advancing Textron’s position in the burgeoning electric aviation market.
Donnelly touched on the eAviation segment’s performance and outlook, noting that the Pipistrel business is doing well, with an increase in the number of deliveries in the quarter. “We did get an FAA exemption on the ability to do flight training on the Velis Electro, which is fundamentally a training aircraft. I think that will help us pick up volume as we can now sell those and use those for training in the U.S. domestic market.”
Research and development are the main drivers of the eAviation segment’s financials, according to Donnelly. He noted that the Nexus eVTOL program is progressing well. “We're doing the full integration and testing of the first craft,” he said. “We'll probably see flight tests later on this year.”
He mentioned that the level of investment being made into eAviation programs will likely level off. Spending for these programs had increased significantly from 2022 to 2023, but this is expected to stabilize in the next few years.
“Our spending here is relatively modest. I think we're taking advantage of a lot of cost structure, talent, and capability that we already have in the company. If the market proves to be what third parties would say the market will prove to be, it's going to be a massive return on investment.”