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Boeing overcomes Dreamliner debacle to record strong financials

Boeing overcomes Dreamliner debacle to record strong financials

Boeing has reported first-quarter core earnings per share increased 24 per cent to $1.73, driven by strong performance across the company’s businesses.

First-quarter 2013 results included the expected benefit of $0.19 per share for the 2012 research and development tax credit; first-quarter 2012 included a benefit of $0.11 per share related to a favourable court judgment on satellite litigation.

First-quarter core operating earnings increased 14 per cent to $1.9 billion from the same period of the prior year when excluding the benefit of $131 million related to the favourable court judgment.

First-quarter revenue was $18.9 billion, earnings from operations were $1.5 billion and earnings per share were $1.44.

The company reaffirmed its 2013 financial and deliveries guidance.

“Strong core operating performance fuelled by productivity gains and solid program execution drove higher company earnings and double-digit operating margins in both major businesses during the quarter,” said Boeing chairman, Jim McNerney.

“Commercial Airplanes worked around the clock to resolve the 787 battery issue while also successfully increasing production rates on the 737 and 777 programs.

“Defence, Space & Security continued to perform exceptionally well, meeting tough affordability goals while investing in future growth.”

“Our first priority in the days ahead is to fully restore our customers’ 787 fleets to service and resume production deliveries.

“Our outlook for the year is positive, and our financial and delivery guidance is reaffirmed as we remain focused on the profitable ramp up in commercial airplane production rates, disciplined execution of our development programs, and continued growth in core, adjacent and international defence and space markets.”

Operating cash flow in the quarter was $0.5 billion, reflecting inventory build on the 787 program offset by timing of receipts and expenditures.

Cash and investments in marketable securities totalled $11.8 billion at quarter-end, down from $13.5 billion at the beginning of the year, primarily due to the pay-down of maturing debt.

Debt was $9.2 billion, down from $10.4 billion at year-end, due to the maturities.

Total company backlog at year-end was a record $392 billion, up from $390 billion at the beginning of the year, and included net orders for the quarter of $20 billion.

Boeing Commercial Airplanes first-quarter revenue decreased to $10.7 billion on delivery mix and lower services revenue.

First-quarter operating margin improved to 11.4 per cent, reflecting the delivery mix and lower R&D, partially offset by higher period costs.

During the quarter, Commercial Airplanes delivered the first 777 aircraft produced at a record production rate of 8.3-per-month and reached a four-year contract extension with the Society of Professional Engineering Employees in Aerospace.

In April, Commercial Airplanes delivered the first 737 produced at a record production rate of 38-per-month.

In April, approval was given by the Federal Aviation Administration for airlines to begin the process of returning the 787 to service with an enhanced battery system.

Commercial Airplanes booked 209 net orders during the quarter.

Backlog remains strong with more than 4,400 airplanes valued at a record $324 billion.