Bombardier Sets New Revenue and Earnings Targets.

Business Editors

MONTREAL--(BUSINESS WIRE)--Oct. 24, 2000

In the context of its annual meeting with financial analysts and institutional investors which will be held Wednesday, October 25, Bombardier (TSE:BBD.A.) (TSE:BBD.B.) today provided its three and five-year targets for revenue and earnings growth as well as an update on each of its main business segments.

President and Chief Executive Officer Robert E. Brown stated that "we are maintaining the earnings growth target of 30 to 40% set at this time last year for the current fiscal year ending January 31, 2001 and for fiscal 2002. For fiscal 2003, we are setting an earnings growth target of 20 to 30%."

Mr. Brown added that "we are extending our target of doubling our revenues over the next five years and we are also setting the target of tripling our profits during that period. This should translate into a compounded annual EPS growth rate of 25% for the period, assuming that the present economic conditions continue to prevail. These targets do not take into account the acquisition of Adtranz which is still subject to approval by regulatory authorities."

During the last fiscal year ended January 31, 2000, Bombardier reached a 32% growth in earnings per share and also had a record year in terms of revenues and backlog. Mr. Brown also stated that "for fiscal 2001, we are on our way to achieving another record breaking year in terms of revenues, earnings and backlog, and we are comfortable with the First Call analysts' consensus estimate of $0.69 per share for the current year. For the first six months of fiscal 2001, revenues were up 11% and earnings per share up 32%. At July 31, 2000, backlog was up 19% to $30.9 billion as compared to a backlog of $26 billion at July 31, 1999."

Bombardier also provided additional details on each of its main business segments.

In aerospace, for the first six months of the fiscal year, all-time record orders were set for regional aircraft with new order intake increasing by 33% compared to the previous year. Deliveries of regional aircraft, business aircraft and amphibious aircraft combined increased by 18%. For the year, aircraft deliveries are expected to reach around 350 units compared to 292 units last year. Overall increase in deliveries of some 20% is targeted for fiscal 2002.

Due to the continued success of the CRJ100/200 program and a strong backlog of 315 firm orders, earlier this year Bombardier announced a production rate increase from 9.5 to 12.5 units per month by fiscal year 2003, which should translate into deliveries of 102 units this year, 135 units next year and 150 units thereafter. The CRJ family was extended last July at the Farnborough Air Show, with the launch of the CRJ900, which complements the 50- and 70-seat models. Bombardier continues to expect strong demand over the coming years for the CRJ series.

In recreational products, profitability has continued to improve and inventories remained at acceptable levels. Since the launch of the group's first ATV, the Bombardier Traxter, two years ago, three new models have been introduced and the focus is on further expansion of the product line to increase market share. Production of ATVs has increased from 6,000 units last year to 18,000 this year and the target for next year is to increase the level to over 30,000 units.

The group continues to focus on new product development and innovation and in order to identify new product opportunities, a Design and Innovation unit has been created. R&D expenditures are mainly focused on further developing high performance 4-stroke clean engine technologies for the group's product line.

A major achievement for the transportation segment was the successful conclusion of a sale and purchase agreement for the acquisition of DaimlerChrysler's subsidiary Adtranz.

If approved by regulatory authorities, the acquisition of Adtranz would enhance Bombardier Transportation's ability to compete vigorously in all markets by giving it access to state-of-the-art technologies such as propulsion systems and other complementary technologies. It would make Bombardier Transportation almost equal to Bombardier Aerospace in terms of revenues, thus improving the balance of the Corporation's activities.

During the year, Bombardier Transportation has made progress on major contracts such as the New York subway and Virgin's Cross-Country railcars. After some delay, the first Acela trainset was delivered last week with entry into revenue service announced by Amtrak for December 11, 2000. The group's results for the second half of the year will be negatively impacted by these additional delays as well as by slower new order intake than expected in Germany. As a result, the EBT margin for this segment should be at approximately 4% for the current year. However, this result has already been factored in the Corporation's overall performance targets.

Bombardier Capital is proceeding with the orderly liquidation of discontinued operations and growing the business where it has clear expertise and know-how. With its new focus, Bombardier Capital continues to increase its profitability.

During the year, Bombardier International has made a significant contribution to breakthroughs achieved by the operating groups in non-traditional markets such as China.

Bombardier Inc., a diversified manufacturing and service company, is a world leading manufacturer of business jets, regional aircraft, rail transportation equipment and motorized recreational products. It is also a provider of financial services and asset management. The Corporation employs 56,000 people in 12 countries in North America, Europe and Asia, and more than 90% of its revenues are generated outside Canada. Bombardier's revenues for its fiscal year ended Jan. 31, 2000 totaled $13.6 billion. FORWARD LOOKING STATEMENTS

This press release includes "forward looking statements" that are subject to risks and uncertainties. For information identifying legislative or regulatory, economic, climatic, currency, technological, competitive and other important factors that could cause actual results to differ materially from those anticipated in the forward looking statements, see Bombardier's Annual Report under the heading Risks and Uncertainties in the Management's Discussion and Analysis section.