Boeing Raises Annual Profit Guidance -- Update
July 26 2017 - 9:00AM
Dow Jones News
By Doug Cameron and Ezequiel Minaya
Boeing Co. Wednesday raised its full-year profit guidance and
outlined plans to pay some of its big pension liabilities ahead of
schedule.
The additional $3.5 billion pension payment highlights the
aerospace company's confidence in boosting cash generated by sales
of its commercial jetliners as Boeing prepares to boost output of
the best-selling 737 and absorb a downturn in demand for larger
aircraft.
Boeing shares were up more than 3% in pre-open trade, lifting
its market value above $130 billion.
The pension payment would cover expected funding needs over the
next four years and eliminates another risk for Boeing, while
providing a tax benefit that lifts its cash flow.
Boeing shares have soared 36% this year as investors expressed
more confidence about the demand for jets and the company's ability
to convert its $500 billion order book into cash and profits. It
now expects to buy back some $10 billion in stock this year.
The move came as Boeing reported forecast-beating second quarter
profit, and the company raised its margin guidance as a mix of job
cuts and efficiency measures boost productivity.
In all for the quarter, Boeing earned $1.76 billion, or $2.89 a
share, up from last year's loss of $234 million, or 37 cents a
share. Excluding nonrecurring items, the company earned an adjusted
profit of $2.55 a share, topping the average analyst estimate for
$2.30 a share, according to Thomson Reuters. Revenue fell 8.1% to
$22.7 billion, reflecting a dip in commercial and military jet
deliveries.
The company retained its full-year guidance for delivering 760
to 765 jetliners. Its backlog rose to $482 billion, including $27
billion of net orders during the latest quarter.
Boeing now expects adjusted earnings of $9.80 to $10 a share
compared with previous guidance for $9.20 to $9.40 a share. Revenue
guidance was unchanged at $90.5 billion to $92.5 billion.
Write to Doug Cameron at doug.cameron@wsj.com and Ezequiel
Minaya at ezequiel.minaya@wsj.com
(END) Dow Jones Newswires
July 26, 2017 08:45 ET (12:45 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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