By Scott Mayerowitz Associated Press
CHICAGO — Boeing’s increased rate of commercial jet manufacturing is starting to pay off for shareholders.
In the first three months of the year, 161 new airplanes rolled off the company’s assembly lines in Everett, Renton and North Charleston, S.C. — more jets than the same period last year. That increased rate contributed to a $965 million profit for the Boeing Co. in the first quarter.
The net income was actually down 12.7 percent from last year’s $1.1 billion first quarter profit, but that is because Boeing took a $330 million accounting write-off related to changes in retirement plans. The company also noted that 2013 earnings were inflated by a one-time research and development tax credit.
Net income per share dropped to $1.28 per share from $1.44 during last year’s first quarter. But adjusted to exclude the write-off, earnings were $1.76 per share, beating the estimate of $1.56 per share from Wall Street analysts surveyed by FactSet.
The company reported $20.47 billion in revenue, more than the $20.15 billion expected by Wall Street. That’s up 8 percent from the $18.9 billion in revenue during the same period last year.
Revenue at Boeing’s commercial plane unit rose 19 percent. The business grew thanks to increased production rates on the 737 lines in Renton. In April, the 737 program reached a production rate of 42 per month. Boeing hopes to increase that to 47 airplanes a month in 2017 to help feed a worldwide demand for the narrow-body jet.
The company’s much-delayed 787 Dreamliner also showed progress, reaching a production rate of 10 per month — although only 18 were delivered during the first quarter. Still, that’s a major improvement over last year, when only one Dreamliner was delivered due to a worldwide grounding of the fleet over concerns about its lithium-ion batteries catching on fire.
Boeing has backlog of 5,100 airplanes on order with a list-price combined value of $374 billion.
On the defense side, revenue fell 6 percent and Boeing lowered full-year revenue guidance for military aircraft to $14.2 billion, down from $15 billion. Its global support and services revenue is expected to climb, however, from $7.8 billion to $8.6 billion. Both changes reflect a realignment within the defense unit.
Boeing also repurchased 19.4 million shares for $2.5 billion during the first quarter.