Boeing sees 7 percent profit gain in third quarter but lowers future outlook

By Dave Carpenter

Associated Press

CHICAGO – Boeing Co. posted a 7 percent profit increase in the third quarter despite the jolt to its commercial airplane business on Sept. 11, but said the attacks will hurt operations over the next several quarters.

Boeing said Thursday it expects to deliver 22 more airplanes this year than it initially estimated after last month’s attacks.

But the world’s largest aerospace company lowered its estimate for 2002 revenues by about $6 billion, to $56 billion, and said it may deliver as few as 350 airplanes next year – down from an estimated 522 this year – with the number likely declining further in 2003. It also said it is considering shutting down production of the unprofitable 717 airliner.

Net earnings were $650 million, or 80 cents a share, in the July-September quarter, up from $609 million, or 70 cents a share, in 2000.

Boeing took a $100 million charge for the first 12,000 of 30,000 planned layoffs from its commercial airplanes unit in Seattle. Excluding that charge, its operating earnings were 88 cents a share – a penny higher than the consensus estimate of analysts surveyed by Thomson Financial/First Call.

Revenues were $13.7 billion, up 15 percent from $11.9 billion a year ago. Chairman and chief executive officer Phil Condit called it a “very solid” quarter despite reduced airplane deliveries after Sept. 11.

But investors’ enthusiasm was muted by the tightened future outlook. In early afternoon trading on the New York Stock Exchange, Boeing shares fell 39 cents to $33.31, down from above $70 in May and $43.46 on Sept. 10.