SAO PAULO (Reuters) – Embraer said on Tuesday that Luxembourg-based Luxair has placed a firm order for two more E195-E2 jets, bumping up its 2023 order of four aircraft and helping to drive shares of the Brazilian planemaker higher.
The first Luxair E2 is expected to be delivered in 2026, the Brazilian company said in a statement, adding that the new firm order provides the carrier with additional delivery slots for 2027.
Luxembourg’s flag carrier still holds delivery positions for three other jets, Embraer said in a statement, which could be converted into orders for the smaller E190-E2 airplane if needed.
Embraer’s shares were up around 2.5% in early Sao Paulo trading, among the top gainers on Brazil’s Bovespa stock index, extending their year-to-date jump to 154% as demand for the firm’s aircraft remains strong.
The companies did not provide a price tag for the deal, but analysts at JPMorgan said that it should add around $170 million to Embraer’s backlog considering list prices for the E195-E2, likely increasing the firm’s commercial aviation backlog by 2%.
“We view today’s announcement as slightly positive for Embraer given the continued backlog growth, which is at a record high of $24 billion, with all segments having a book-to-bill above 1:1,” JPMorgan analysts said in a note to clients.
Separately, the world’s third-largest planemaker after Airbus and Boeing announced on Tuesday it was opening an office focused on defense in Portugal, as it aims to deepen ties with European and NATO clients.
Reuters reported last month that the office was part of Embraer’s plans as sales of its C-390 Millennium military cargo aircraft gained pace in the region.
The company earlier this week said that Portugal, which already operates the C-390, had also ordered 12 A-29N Super Tucano light attack aircraft. The Portuguese government pegged the deal at 200 million euros.
“It underscores the positive momentum of Embraer’s defense business,” BTG Pactual analysts said.
“We expect favorable commercial momentum across all major divisions and a depreciated Brazilian real to keep sustaining positive momentum in Embraer shares.”
(Reporting by Gabriel Araujo; Additional reporting by Isabel Teles; Editing by Susan Fenton and Emelia Sithole-Matarise)
