Business

July 25, 2012

Boeing second net income up; raises outlook

by Samantha Bomkamp
Associated Press

Boeing posted a surprise improvement in second-quarter net income July 25 as demand for passenger jets thrived and its defense business held its own.

The maker of 737 aircraft and F-18 fighter jets also raised its earnings forecast for the year, suggesting demand for new planes could insulate it from the sluggish global economic environment.

Boeing’s 3-percent profit increase handily beat forecasts from Wall Street analysts, who worried that sales in Boeing’s defense unit would fall amid lower defense spending in the U.S. and Europe. Boeing said that it was reining in costs to prevent revenue in the segment that produces Chinook helicopters and F-18s from being hit.

Boeing, which is based in Chicago, reported net income of $967 million, or $1.27 per share, for the April-June period compared with $941 million, or $1.25 per share, a year earlier.

Revenue jumped 21 percent to $20 billion from $16.54 billion a year ago.

Analysts polled by FactSet expected earnings of $1.14 per share on revenue of $19.25 billion.

Defense revenue rose 7 percent, while revenue in the commercial airplane division jumped 34 percent. The divisions are roughly the same size, but some analysts were concerned that their earnings would go in opposite directions. Both segments faced higher costs in the second quarter. Total expenses were up 30 percent.

Boeing’s defense unit is vulnerable to potentially severe military spending cuts in January. The cuts will be automatic unless Congress agrees to alternatives for cutting the deficit. The military would face $492 billion in cuts over a decade, with domestic spending reduced by another $492 billion over 10 years.

For now Boeing’s defense unit is strong. Second-quarter revenue growth is about the same as Boeing saw in the first three months of the year.

Boeing’s commercial airplane unit, meanwhile, is speeding production and deliveries of its new 787. That will move planes that have been mostly finished, but undelivered, out of inventory and turn them into cash. Boeing is also booking firm orders for its new 737 Max, a redesigned version of the model. July 25, the company said that Aeromexico plans to buy up to 100 of its planes – most of them the 737 Max – in a deal worth almost $11 billion.

For all of 2012, Boeing now expects to earn $4.40 to $4.60 per share, up from a previous forecast of $4.15 to $4.35 per share. Analysts estimate full-year earnings of $4.57 per share.

Earlier July 25 defense contractor Northrop Grumman posted second-quarter results that beat Wall Street estimates, and Lockheed Martin reported better-than-expected results July 24.




All of this week's top headlines to your email every Friday.


 
 

 
Lockheed Martin photograph

Lockheed Martin successfully tests design changes for Orion spacecraft’s fairing separation system

Lockheed Martin photograph A protective panel for Orion’s service module is jettisoned during testing at Lockheed Martin’s Sunnyvale, California facility. This test series evaluated design changes to the spacecraft’s fair...
 
 

Australian company to provide parts for initial production of Triton UAS

Northrop Grumman has awarded the first Australian supplier contract for the U.S. Navy’s MQ-4C Triton unmanned aircraft system initial production lot to Ferra Engineering. Brisbane-based Ferra Engineering will manufacture mechanical sub-assemblies for the first four Triton air vehicles including structural components. “At Northrop Grumman it’s very important to not only develop...
 
 

Insitu awarded LRIP Lot IV RQ-21A Blackjack Systems contract

Under the terms of its latest contract, Insitu will build six RQ-21A Blackjack systems for the U.S. Navy and Marine Corps. The $78-million Small Tactical Unmanned Aircraft Systems Lot IV Low Rate Initial Production contract is the latest event in the program’s progression toward the Initial Operational Test and Evaluation phase.   “This award will...
 

 
LM-C5

Lockheed Martin delivers 29th C-5M Super Galaxy

The 29th Lockheed Martin C-5M Super Galaxy takes off on its delivery flight.  Lockheed Martin delivered the 29th C-5M Super Galaxy to the U. S. Air Force July 28. A Defense Contract Management Agency (DCMA) aircrew ferried the...
 
 

Northrop Grumman successfully delivers deformable mirror for world’s largest solar telescope

The world’s largest ground-based solar telescope is one step closer to operation with the acceptance of the deformable mirror engineered by AOA Xinetics, a Northrop Grumman company. The Daniel K. Inouye Solar Telescope, currently under construction on Haleakala on the island of Maui, Hawaii, will offer unprecedented high-resolution images of the sun using the latest...
 
 

Raytheon appoints president, Integrated Defense Systems

Raytheon Chairman and CEO Thomas A. Kennedy announced July 30 the appointment of Wesley D. Kremer as President, Integrated Defense Systems, effective immediately. Kremer, 50, previously served as vice president of the Air and Missile Defense Systems product line of Raytheon Missile Systems. He succeeds Daniel J. Crowley, who informed the company of his intention...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>