Boeing Q1 profit beats expectations despite 787 woes

The Boeing Co.’s first-quarter profit rose 5.3 percent and beat analysts’ estimates as increased deliveries for 777- and 737-model jets made up for the halt in buyers picking up Dreamliners while that plane was grounded.

“Commercial Airplanes worked around the clock to resolve the 787 battery issue while also successfully increasing production rates on the 737 and 777 programs,” Jim McNerney, Boeing CEO, said in a statement.

Profit excluding some pension expenses was $1.87 billion, or $1.73 a share, compared with $1.77 billion, or $1.40, a year earlier, the Chicago-based company said today in a statement. Analysts projected $1.49 a share on that basis, the average of 18 estimates compiled by Bloomberg.

Boeing delivered four more 777s and three more 737s in the quarter than a year earlier, making up for the pause in handing over 787 Dreamliners, which are less profitable in part because the program is new. The world’s largest planemaker shipped 137 commercial aircraft, matching the year-earlier tally.

“Boeing benefited from a better mix in deliveries,” said Ken Herbert, a San Francisco-based analyst with Imperial Capital LLC, in a telephone interview before the release. “Delivering those higher-margin, more-mature programs — the 737 and the 777 — was incrementally positive to the bottom line.”

Revenue fell 2.5 percent to $18.9 billion because of the drop in 787 deliveries and the effect of U.S. budget cuts on Boeing’s defense business. Analysts had predicted revenue of $18.8 billion.

Pension Expense

Since January, Boeing has used a profit measure — so- called core earnings per share — that it said gives a clearer picture by adjusting for market fluctuation in pension expenses. Without the adjustment, net income was $1.11 billion, or $1.44 a share, compared with $923 million, or $1.22, a year earlier.

The company today reaffirmed its 2013 forecast of core EPS of $6.10 to $6.30.

Boeing delivered only one Dreamliner in this year’s first three months, down from 23 in the previous quarter, after the Federal Aviation Administration grounded the plane on Jan. 16. Shipments stopped while production continued.

The FAA approved Boeing’s changes to the 787’s lithium-ion battery system to improve safety on April 19, paving the way for Dreamliner flights and deliveries to resume. The company has deployed about 300 people to install the new battery systems, which takes about five days on each plane.

More in Herald Business Journal

Best foot forward: Ferndale company to make custom shoes easy

Long specializing in insoles, Superfeet is putting 3-D machines in stores to make customized shoes.

Port of Everett CEO Les Reardanz has been called up and will be spending much of the year away from his office. He is going to Afghanistan. (Dan Bates / The Herald)
Port of Everett CEO reporting for duty — in Afghanistan

Les Reardanz has been called to active duty with the Navy for an eight-month deployment.

Alaska Airlines to announce Paine Field destinations Tuesday

The Snohomish County airport’s passenger terminal is slated to see flights this fall.

Early boarding pass: Everett’s rising passenger terminal

Here’s what to expect when two airlines begin passenger service at Paine Field later this year.

Closing of 63 Sam’s Club stores impacts small business

The retailer has historically prided itself on the services it has provided small business members.

Ford goes ‘all in’ on electric cars with $11 billion investment

That’s up from the $4.5 billion that Ford said in late 2015 it would invest through the end of the decade.

New pickups from Ram, Chevy heat up big-truck competition

Big pickup truck sales are important to automakers, which make huge profits on them.

Intel underfoot: Floor sensors rise as retail data source

The sensors can also be used in office buildings to reduce energy costs and nursing homes for falls.

Most Read