All amounts in this press release are in U.S. dollars unless otherwise indicated.)

MONTREAL -- (MARKET WIRE) -- May 29, 2007 -- Bombardier Inc. (TSX: BBD.A)(TSX: BBD.B)

- Consolidated revenues of $4 billion, compared to $3.5 billion last fiscal year

- EBITDA from continuing operations of $314 million, compared to $206 million last fiscal year

- EBIT from continuing operations of $183 million, compared to $78 million last fiscal year

- Net income of $79 million ($0.04 per share), compared to $24 million ($0.01 per share) last fiscal year

- Free cash flow usage of $154 million, after payment of a discretionary pension fund contribution of $174 million, an improvement of $385 million

- Order backlog strong at $45.4 billion, an increase of $4.7 billion

Bombardier today released financial results for the first quarter of fiscal year 2008 that show substantial improvement in many key areas. Earnings before financing income, financing expense and income taxes (EBIT) grew by $105 million, to reach $183 million. This resulted in an EBIT margin of 4.6%, compared to 2.2% for the same period last fiscal year. Similarly, net income increased by $55 million to total $79 million, while earnings per share were $0.04, compared to $0.01 for the same period last fiscal year. Free cash flow (cash flows from operating activities less net additions to property, plant and equipment) usage of $154 million, after payment of a discretionary pension fund contribution of $174 million, compares to a usage of $539 million for the same period last fiscal year. The overall order backlog also improved by $4.7 billion, to attain a record $45.4 billion.

"We had a strong first quarter, with both groups contributing solid results," observed Laurent Beaudoin, Chairman of the Board and Chief Executive Officer, Bombardier Inc. "As both groups make progress toward their EBIT targets, we're seeing overall improvement in profitability and cash flow generation. At Aerospace, business aircraft continue to attract a substantial level of new orders. We're now also seeing the U.S. airline industry rebounding, as demonstrated by a higher level of regional aircraft orders compared to last year. Meanwhile, our Transportation group's order intake remains robust, as it continues to focus on its margin and quality enhancement program," added Mr. Beaudoin. "With the combination of our various initiatives yielding improved profitability, and our strong backlog, we are well positioned to pursue our goal of long-term sustainable growth."

Bombardier Aerospace

EBIT rose to $112 million, an increase of $57 million compared to the first quarter of the previous year. This represents an EBIT margin of 5%, compared to 2.8% for the same period last year. Free cash flow was also excellent in the first quarter, improving by $334 million compared to the same period last fiscal year.

Bombardier Aerospace received 174 net orders during the first quarter, compared to 52 the previous year, bringing the backlog to $15.4 billion. The group registered 91 net orders for regional aircraft, 53 of these being for regional jets, including an order for 30 CRJ900 jets from Delta Air Lines. Subsequent to the quarter, Delta placed an additional firm order for 14 CRJ900 jet. Thirteen airlines worldwide have now ordered CRJ900 aircraft, and they have been unanimous in praising the jet's remarkable fuel efficiency, low noise and reduced emissions.

Meanwhile, the popularity of Bombardier turboprops continues unabated, with 38 orders during the quarter, including two orders of 15 Q400 aircraft each from Horizon Air and Pinnacle Airlines Corp. Subsequent to the quarter, Flybe also signed a contract to acquire 15 additional Q400 turboprops. Regarded by operators as one of the quietest and most effective aircraft, Bombardier's Q400 turboprops deliver superior economics and exceptional environmental performance.

Business aircraft revenues also increased, benefitting from a richer mix of larger aircraft deliveries. The market remains robust, with a healthy level of net orders that reached 83 business jets, compared to 33 for the same period last year.

Bombardier Transportation

Bombardier Transportation's EBIT rose to $71 million, an improvement of $48 million compared to the same period last fiscal year. This represents an EBIT margin of 4.2%, compared to 1.5% for the same period last year. Free cash flow also improved by $29 million, after the payment of a discretionary contribution of $174 million to various employee pension funds in the United Kingdom (U.K.).

New order intake remained at a high level, reaching $3 billion for the quarter, with a book-to-bill ratio of 1.8. These orders reflect the group's continued success in the regional, commuter and locomotive segments. Among these successes, Bombardier Transportation received a key order from Trenitalia of Italy for 150 E464 electric locomotives valued at $487 million, as well as an order for 256 cars for high-capacity AGC-type trains from the Societe Nationale des Chemins de fer Francais valued at $416 million. The group's continuing efforts to develop new business opportunities in the strategic and emerging markets of China, India and Russia are bearing fruit. During the quarter, the group signed a contract with Dalian Locomotives and Rolling Stock Company Ltd. of China to supply propulsion and train control equipment, design and technical support for high-power freight electric locomotives valued at $480 million. Bombardier also won a landmark contract to install the first modern signalling system in the Commonwealth of Independent States. Subsequent to the quarter, Bombardier Transportation signed an agreement creating two joint ventures with Transmashholding of Russia for propulsion technology and manufacturing related to locomotives. In this context, RZD Russian railways and Transmashholding signed a framework agreement for the supply of 806 locomotives through 2015, for which one of the newly created joint ventures is intended to become a propulsion converter supplier.

DIVIDENDS ON PREFERRED SHARES

Series 2 Preferred Shares

A monthly dividend of $0.1250 Cdn per share on Series 2 Preferred Shares has been paid on April 15 and May 15, 2007.

Series 3 Preferred Shares

A quarterly dividend of $0.34225 Cdn per share on Series 3 Preferred Shares is payable on July 31, 2007 to the shareholders of record at the close of business on July 13, 2007. In accordance with its terms, the dividend rate will be reset on July 11, 2007, for the next five years, beginning August 1, 2007.

Series 4 Preferred Shares
A quarterly dividend of $0.390625 Cdn per share on Series 4 Preferred Shares is payable on July 31, 2007 to the shareholders of record at the close of business on July 13, 2007.

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