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 July 7, 2015

News: F-35 loses dogfight to fighter jet from 1980s – A new report alleges that an F-35A was defeated by the very aircraft it is meant to replace.   Business: South Korea selects Airbus for $1.33 billion tanker contract – European aerospace giant Airbus won a $1.33 billion deal June 30 to supply air refueling...
 
 
U.S. Chamber of Commerce photograph

Boeing, Embraer to collaborate on ecoDemonstrator technology tests

U.S. Chamber of Commerce photograph Frederico Curado, president & CEO of Embraer, and Marc Allen, president of Boeing International, at the Brazil-U.S. Business Summit in Washington, D.C. The event occurred during an offici...
 
 
Untitled-2

Tactical reconnaissance vehicle project eyes hoverbike for defense

The U.S. Army Research Laboratory, or ARL, has been exploring the tactical reconnaissance vehicle, or TRV, concept for nearly nine months and is evaluating the hoverbike technology as a way to get Soldiers away from ground thre...
 

 
Air Force photograph by SSgt. William Banton

Upgraded AWACS platform tested at Northern Edge

Air Force photograph by SSgt. William Banton Maintenance crew members prepare an E-3G Sentry (AWACS) for takeoff during exercise Northern Edge June 25, 2015. Roughly 6,000 airmen, soldiers, sailors, Marines and Coast Guardsmen ...
 
 
LM-Legion

Lockheed Martin’s Legion Pod™ takes to skies

Lockheed Martin photograph by Randy Crites Lockheed Martin’s Legion Pod recently completed its first flight test, successfully tracking multiple airborne targets while flying on an F-16 in Fort Worth, Texas. Legion Pod was in...
 
 
Air Force photograph by SSgt. Marleah Robertson

First Marine graduates Air Force’s F-35 intelligence course

Air Force photograph by SSgt. Marleah Robertson Marine Corps 1st Lt. Samuel Winsted, an F-35B Lightning II intelligence officer, provides a mock intelligence briefing to two instructors during the F-35 Intelligence Formal Train...
 




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>