Bombardier Inc. (BBDb.TO) plunged after lowering its 2019 financial forecasts because of new costs in its troubled rail-equipment division.

Additional outlays of as much as $300 million are needed to complete late-stage train projects and meet delivery schedules, Bombardier said in an earnings release Thursday. The company predicted free cash flow usage of $500 million, burning twice as much as the worst-case scenario in the previous forecast.

Bombardier is struggling to right its rail business, which already prompted the company to cut its 2019 outlook in April. The latest woes are marring Chief Executive Officer Alain Bellemare’s turnaround effort, in which he is exiting commercial-aircraft manufacturing to focus on making private jets and trains.

“It appears that the stock is not quite done with noisy quarters,” Stephen Trent, an analyst at Citigroup Inc., said in a note to clients. He called Bombardier’s second-quarter results and weaker outlook “disappointing.”

The shares dropped 19 per cent to $1.84 at 9:32 a.m. in Toronto after sliding as much as 22 per cent for the biggest intraday drop in three months. Bombardier advanced 12 per cent this year through Wednesday, trailing the 22 per cent gain of a Standard & Poor’s index of Canadian industrial stocks.

Bombardier’s US$2 billion of 7.875 per cent bonds due 2027 traded at as low as 97.5 cents, the lowest since June 4, according to Trace prices.

Additional Risk

The Montreal-based company said it would consolidate its three aerospace units into a single one called Bombardier Aviation, focused on making private jets.

Bombardier can’t rule out additional risk to its train-delivery timetable, Chief Financial Officer John Di Bert said on a conference call with analysts. The company has suffered high-profile stumbles on transit projects in New York and Toronto, and a railroad contract in Switzerland.

The maker of trains and planes recently sold its turboprop operation to De Havilland Aircraft of Canada Ltd., and agreed to sell its CRJ regional-jet business to Mitsubishi Heavy Industries Ltd. Last year, it handed control of its C Series jetliner program to Airbus SE, which renamed the aircraft the A220.

--With assistance from Sandrine Rastello and Paula Sambo