Boeing's first quarter earnings beat expectations

Boeing unveiled a 20 per cent rise in first quarter earnings on Wednesday that beat analysts' estimates despite grounding its 787 Dreamliner fleet after batteries overheated.

Boeing unveiled a 20 per cent rise in first quarter earnings on Wednesday that beat analysts' estimates despite grounding its 787 Dreamliner fleet after batteries overheated.

The planemaker reported net income of $1.1bn for the first three months of the year, compared to $923m the year before.

Earnings per share climbed 18% to $1.44 from $1.22.

The results showed little impact from the Dreamliner problems. Boeing was forced to ground its entire fleet after batteries in two of its jets overheated.

The company has reassured investors that it expects to deliver all the jets it had planned, including Dreamliners which could be ready to be flying again in less than a week.

However, a halt in Dreamliner deliveries saw revenues fall 2.5% to $18.9bn during the quarter.

"Strong core operating performance fuelled by productivity gains and solid programme execution drove higher company earnings and double-digit operating margins in both major businesses during the quarter," said Boeing Chairman, President and Chief Executive Officer 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 programmes. Defense, Space & Security continued to perform exceptionally well, meeting tough affordability goals while investing in future growth."

The estimated costs of the Dreamliner issues were not released in the statement.

Analysts do not anticipate the costs of fixing the Dreamliner to be substantial compared with the $20bn expense of developing the jet and the $120bn in estimated costs for its initial production run.

McNerney said the company's first priority in the days ahead was to restore the 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 defense and space markets."

RD

Recommended

Three strong Asian stocks trading at bargain prices
Share tips

Three strong Asian stocks trading at bargain prices

Professional investor Nitin Bajaj of the Fidelity Asian Values investment trust picks three stocks that dominate their industries, earn good returns o…
20 Sep 2021
Why it pays to face up to your investment mistakes
Investment strategy

Why it pays to face up to your investment mistakes

Buying stocks can be a complicated business. But selling stocks can be tricky, too – even if you sell for the right reasons. Max King explains how to …
17 Sep 2021
Share tips of the week – 17 September
Share tips

Share tips of the week – 17 September

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
17 Sep 2021
Royal Mail will deliver for investors – here's how to play it
Trading

Royal Mail will deliver for investors – here's how to play it

Royal Mail Group has found its feet in the past 18 months and looks cheap. Matthew Partridge looks at how to trade the shares.
14 Sep 2021

Most Popular

The times may be changing, but don’t change how you invest
Small cap stocks

The times may be changing, but don’t change how you invest

We are living in strange times. But the basics of investing remain the same: buy fairly-priced stocks that can provide an income. And there are few be…
13 Sep 2021
Two shipping funds to buy for steady income
Investment trusts

Two shipping funds to buy for steady income

Returns from owning ships are volatile, but these two investment trusts are trying to make the sector less risky.
7 Sep 2021
How to stop recurring subscriptions becoming a drain on your money
Personal finance

How to stop recurring subscriptions becoming a drain on your money

Tracking and pruning subscriptions isn’t as easy as it sounds. Here's how to take charge.
14 Sep 2021