Business

July 24, 2013

Boeing second quarter profit tops expectations despite 787

Joshua Freed
Associated Press

Boeing’s problems with its 787 have made headlines, but they haven’t hurt profits.

It posted a bigger-than-expected second-quarter profit as it ramped up deliveries of commercial planes like its 737 and its 777.

Boeing is in the midst of a boom in airplane orders as airlines in Asia and Latin America expand. It is speeding up production of its 737 as well as the new 787, known as the Dreamliner. Deliveries of all commercial planes rose 13 percent to 169 planes during the quarter.

Deliveries of the 787 were temporarily halted in January when the plane was grounded because of battery problems. But they resumed in May and Boeing delivered 16 of the jets during the quarter. It still expects to deliver at least 60 of the 787s this year ó the same goal it had before the battery problems surfaced.

Boeing’s net income rose 13 percent to $1.09 billion, or $1.41 per share. During the same period last year it earned $967 million, or $1.27 per share. Revenue rose 9 percent to $21.82 billion.

The results include costs from pensions. On that basis, analysts surveyed by FactSet had been expecting a profit of $1.30 per share with revenue of $20.79 billion.

Boeing said that it has finished paying airline customers who had to stop flying their 787s because of the grounding. Boeing didn’t say how much it spent, but it wasn’t enough to show up in the company’s financial results released July 24.

Fifty 787s were grounded for almost four months because of problems with their batteries. Several airlines said they wanted compensation. Airlines have to keep making payments on planes whether they’re flying or not. The Polish government has said the grounding cost LOT Polish Airlines more than $30 million in lost flights alone.

“There were some instances where we had obligations to customers, and those have all been satisfied,” Chairman and CEO Jim McNerney said on a conference call. “We think they are all behind us now,” he added.

He also said Boeing is discussing with Ethiopian Airlines the method for repairing a 787 that caught fire while parked at London’s Heathrow airport on July 12. The fire appeared to burn through the outside skin of the plane’s tail, suggesting that an extensive repair will be needed.

Boeing raised its full-year profit guidance to $6.20 to $6.40 per share ó a dime higher than its old guidance. Once it pays for pension expenses it will earn $5.10 to $5.30 per share. On that basis, analysts are expecting $5.34 per share.

The company now expects revenue of $83 billion to $86 billion, which is $1 billion more than it previously predicted. Analysts were expecting $84 billion.

Revenue from commercial planes rose 15 percent to $13.62 billion, and profits in that segment jumped 20 percent to $1.45 billion. The 787s actually hurt profit margins because they cost more to build than Boeing is collecting, but delivering the planes brings in more revenue.

Things are slower at Boeing’s defense arm. Revenue there was flat at about $8.19 billion, although operating profits rose 4 percent to $776 million. Boeing and other defense contractors have had to cope with the automatic federal spending cuts that took effect in the spring.




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


 
 

 

Headlines August 28, 2015

Business: Rafale, Mistral on agenda for Le Drian in Malaysia, India – French Defense Minister Jean-Yves Le Drian is due to visit Malaysia Aug. 30, with talks expected to cover the Rafale fighter jet and Mistral helicopter carrier, website La Tribune reported. U.S. Army to choose new landing craft next year – In line with the Pentagon’s...
 
 

News Briefs August 28, 2015

Boeing plans to lay off some Southern California workers Boeing has announced that it plans to lay off employees at its Southern California-based satellite division. The Los Angeles Times reports that the aerospace giant said Aug. 25 that it will lay off as many as several hundred employees at the El Segundo factory. Boeing says...
 
 

Special tactics Airmen killed in hostile incident

Two special tactics airmen, who were deployed in support of Operation Freedom’s Sentinel, were killed near Camp Antonik, Afghanistan, Aug. 26. Capt. Matthew D. Roland, 27, and SSgt. Forrest B. Sibley, 31, were at a vehicle checkpoint when two individuals wearing Afghan National Defense and Security Forces uniforms opened fire on them. NATO service members...
 

 

Hurricane Hunters to fly Tropical Storm Erika

The Air Force Reserve Hurricane Hunters are operating out of Homestead Air Reserve Base, Fla., flying their state-of-the-art WC-130J Super Hercules into Tropical Storm Erika in support of the National Hurricane Center in Miami. The 53rd Weather Reconnaissance Squadron flew four missions into the tropical storm from their deployed location at St. Croix in the...
 
 
LM-MUOS

U.S. Navy, Lockheed Martin ready to launch MUOS-4 Aug. 31

The U.S. Navy and Lockheed Martin are ready to launch the fourth Mobile User Objective System secure communications satellite, MUOS-4, from Cape Canaveral Air Force Station, Fla., Aug. 31 aboard a United Launch Alliance Atlas V...
 
 

Pentagon probing alleged distorting of war intelligence

The Pentagon’s inspector general is investigating an allegation that the military command overseeing the anti-Islamic State campaign distorted or altered intelligence assessments to exaggerate progress against the militant group, a defense official said Aug. 26. The official was not authorized to discuss the probe publicly and so spoke on condition of anonymity. The investigation was...
 




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>