BUSINESS

CAE sells flight simulators to Bombardier and customers in Asia, North America

10/04/2012 12:37 EDT | Updated 12/04/2012 05:12 EST
MONTREAL - Flight simulator maker CAE Inc. says it has sold six new simulators to customers in Asia and North America, plus updates for a number of customers for a total value of $85 million at list prices.

The Montreal-based company said Thursday that Bombardier Aerospace (TSX:BBD.B) is buying one of the simulators to support the development of its Global 7000 and 8000 business jet program.

The other simulators are: one Boeing 737-800 to Alaska Airlines; one A320 for the Asian Aviation Centre of Excellence in Kuala Lumpur, Malaysia, and three simulators — Airbus A330, Boeing 737 and Boeing 777 — for the Zhuhai Flight Training Centre in China.

"We are excited about supporting Bombardier once again in their new aircraft development programs using CAE's unique simulation engineering expertise and we are very pleased to welcome Alaska Airlines as a new full-flight simulator customer," said CAE spokesman Jeff Roberts.

"Through the simulator orders from the Asian Aviation Centre of Excellence and the Zhuhai training centre, we are happy to support the growth of the fleets of China Southern, Air Asia and other airlines throughout Asia," added Roberts, CAE group president, civil simulation products, training and services.

Benoit Poirier of Desjardins Capital Markets said the sales demonstrate that the civil aerospace environment remains solid.

"Order flow is typically slower in the summer months, which reaffirms our belief that sales will ramp up in the fall season," he wrote in a report.

Overall, the company has sold 16 flight simulators to date in fiscal 2013.

CAE (TSX:CAE) won 37 simulator orders last year and expects orders will be in the "mid-30s" in the fiscal year ending March 31, 2013.

"We are fairly confident that the company will again meet its full flight simulator guidance in fiscal 2013, given the strong deliveries expected by Airbus and Boeing, as well as today’s positive announcement," Poirier said.

He said the orders reflect CAE's strong leadership position in the Middle East and India, and solid penetration of emerging markets. Some 60 per cent of orders last year came from Asia and Australia, while 16 per cent came from the Middle East and Africa.

The flight simulator and training provider has said it is somewhat protected from defence budget cuts since its products allow military forces to train at lower cost than using real aircraft.

CAE is a global leader in modelling, simulation and training for civil aviation and defence, employing some 8,000 people at more than 100 sites and training locations in about 30 countries.

Its shares were down two cents at $10.51 in midday trading Thursday on the Toronto Stock Exchange.