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Workers apply a Rolls-Royce decal to the engine of a Bombardier Global 6500 jet at the National Business Aviation Association exhibition in Las Vegas on Oct. 21, 2019.

David Becker/Reuters

Bombardier Inc said on Monday it expects first-quarter business jet revenue to come in ahead of analysts’ estimates, as rising vaccinations encourage wealthy travelers to return to flying.

The company’s shares rose 4 per cent in early trading.

Business jet makers are seen benefiting as more people start flying mainly for leisure purposes following easing of coronavirus-led restrictions.

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The Montreal-based maker’s U.S. rival Textron Inc last week posted better-than-expected results, propelled by a rebound in demand for its small and medium business jets.

Bombardier, the maker of Global aircraft, said it expects first-quarter adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) from continuing operations of $123 million, above analysts’ average estimate of $89 million, according to IBES data from Refinitiv.

The company, which has cut thousands of jobs to save costs, will report results on Thursday.

Bombardier said its first-quarter business aircraft deliveries would be 26 planes, the same number it delivered in the year-ago quarter.

While deliveries are roughly the same, Bombardier’s product composition is shifting toward the higher priced Global 7500 jets, which are a revenue driver.

The company expects business jet revenue to rise by 18 per cent to $1.3 billion in the first quarter, from a year ago, beating Wall Street’s estimate of $1.18 billion.

Bombardier said it remains on track to deliver between 110-120 business aircraft in 2021. The company’s full-year deliveries fell 20 per cent to 114 jets in 2020.

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Separately, the company on Monday launched consent solicitations with respect to its outstanding senior notes or debentures.

Bombardier said it received a letter in April from counsel to a holder of a certain series of notes, claiming that the company’s divestitures of non-core assets, including its transportation business, regional jet program and aerostructures unit, constitute a breach of certain covenants.

Bombardier said it believes that these allegations are without merit and that it has not breached any covenant.

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